TV Debate on Howard Government's Workplace Changes

Here is a transcript from SBSTV's Insight program where AWU National Secretary Bill Shorten takes part in a forum on the Howard Government's workplace changes.

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With terrorist threats dominating the news, the big changes to our workplace laws have almost slipped under the radar. If the polls are any guide, John Howard's workplace changes, now before parliament, aren't popular with many voters. The Government says they'll make the system fairer and simpler and create more jobs. But the opposition and the unions say the changes will seriously disadvantage lower-paid workers, and undermine collective bargaining. So who's right?

JENNY BROCKIE: Tonight we're joined by union leaders, employers' representatives, workers, bosses and a former prime minister. Welcome to everyone tonight and a special welcome to you Bob Hawke in Adelaide. I'd like to start with you. You've described these reforms as the most despicable and ungracious decision by any prime minister in the history of industrial relations in this country. What is it you object to most strongly?

BOB HAWKE, FORMER AUSTRALIAN PRIME MINISTER: The thing I object to most strongly is that it perverts the concept of what we believe is the essential Australian characteristic, that is the fair go. That is that it's the role of government and the institutions it creates not to prop up the already privileged, but to extend protection to the least privileged in society. These proposals do exactly the opposite. I think it's ungracious because in fact John Howard is the inheritor of the restraint exercised by the trade union movement during the '80s and early '90s when we transformed this economy and created the strength of the current economy as it is. He is the inheritor of the fact that the trade unions in that period did not use the power they could have exercised to increase wages, they had restraint, we could not have transformed this economy without their involvement. And now, the inheritor of all they did, John Howard, the strong economy, what does he do? Kicks them in the teeth and is going to create a situation where the least privileged, those with the least power to look after themselves are going to be thrown to the wolves.

JENNY BROCKIE: Peter Hendy, the economy is going well and we're not plagued by strikes. It's not as though we're facing massive industrial disruption. Why mess with a system that seems to be working.

PETER HENDY, AUSTRALIAN CHAMBER OF COMMERCE AND INDUSTRY: We have a low level of strikes compared to previous years but that's common across Western countries and it's more to do with monetary policy and keeping inflation low. The fact is monetary policy is a lot better than it was years ago. I've got a lot of respect for Mr Hawke in the sense that his government implemented a lot of very good reforms but the fact is that one of the ones he didn't do, was industrial relation reforms and we need to kick start productivity growth in this country again and one of the principal ways to do that is to again return to the issue of industrial relation reform.

JENNY BROCKIE: And effectively that means stripping away some of the conditions we've taken for granted?

PETER HENDY: Certainly not, after some of the changes the Government has announced recently, we will still have a more heavily regulated system, more protections for Australian workers than exist in either the United Kingdom or in New Zealand, for example.

JENNY BROCKIE: Well the Government has spent more than $40 million of taxpayers money on an advertising campaign to sell these changes. One of the themes is that workers shouldn't fear that the new laws will make it easier to get the sack, here's one of the ads.

WORK CHOICES AD:

NARRATOR: With Work Choices it will continue to be unlawful for you to be sacked for such things as being pregnant, for family responsibilities, like caring for a child who has fallen ill. It will be unlawful for you to be sacked for temporary absence from work due to illness or injury or for Trade Union Membership. It will be unlawful for you to be sacked for refusing to negotiate an Australian Workplace Agreement, employees who believe they have been unlawfully sacked will receive assistance and support from the Office of Workplace Services and for the first time, if eligible they may receive legal advice paid for by the Australian Government. To find out the facts call the WorkChoices hotline on 1800 025 239 or visit the website for your free copy of the WorkChoices booklet.

JENNY BROCKIE: Well, Bob Hawke, workers rights, protected by law is that is what's going to happen, do you think?

BOB HAWKE: Absolutely not, may I go back to a comment that was made by the previous speaker. Why do they just keep trotting out these platitudes that they're going to increase productivity, increase jobs by this draconian change in the legislation. The evidence from the independent economists, experts in the field of industrial relations refutes that, Professor Mark Wooden from the Melbourne Institute, his exact words "There is no economic sense in it." The 17 independent experts in industrial relations from around the Australian tertiary institutions issued their report recently and they totally condemn this and on this point that your speaker talked about they say "There is no convincing evidence that the proposals will generate jobs." And on this crap about productivity, this is what they say. "There are also claims about a productivity boom but the claim that individual contracts deliver a higher productivity is highly questionable." The experts throw these platitudes straight back in the mouth of the government.

JENNY BROCKIE: Alright well let's have a look at the changes because a lot of people may not be aware of exactly what those changes actually are. John Buchanan you've looked very closely at the new legislation, what are the biggest changes that are facing Australian workers?

JOHN BUCHANAN, SYDNEY UNIVERSITY: There are four things going on here. The first is shrinking the reach of labour law. Currently workers have awards that cover 20 allowable matters there will be only be five issues that are protected in the legislation covered and if you're a casual there will only be three. So the five is not for all it is only for permanent employees. The second is there's a move to unify the system through a hostile federal takeover. This will still leave around 2 million workers beyond the reach of the federal system, so it is not going to be totally successful. Thirdly, there is a big shift in bargaining power so that employers will have far more bargaining power. Unions are going to have significant barriers put in place to taking strikes. It will take at least four to six weeks to get an effective strike up. Under individual lockouts for people in dispute over their AWAs, employers can stand workers down or lock them out on three days notice, no questions asked. Some AWA lockouts have lasted as long as three months. And the final and the most ironic one is there's a huge centralisation of power in the Minister for Industrial Relations. When you read the bill in all its 700 pages of glory, a lot of issues ultimately turn on what the minister wants to do by direct legislative power or through delegated legislation.

JENNY BROCKIE: Peter Hendy I'm interested in this point because there is talk about it being a simpler system but the legislation is 700 pages long.

PETER HENDY: We ourselves have complained about the legislation, 700 pages is much too much. We didn't think the government went far enough in the reforms and we think it should be a simpler system. A lot of the complexity is due to the fact that the Commonwealth needs to use the Corporations power to implement these changes under the constitution, and that's because the State Governments have been hostile to the - to having one national system. But the fact is having one national system of industrial relations makes a lot of sense compared to having six systems as we have today.

JENNY BROCKIE: Do you accept that it is shifting the balance of power to the employer rather than to - in the case of collective bargaining, for example, that it's pushing towards more individual negotiations between employers and employees rather than collective agreements?

PETER HENDY: Well, what it does is it has more workplace agreements. It has an emphasis towards workplace agreements and that can be collective bargaining or individual bargaining. But that's up to the participants in a workplace.

JENNY BROCKIE: Bill Shorten, what do you think about that? Is it shifting the balance of power?

BILL SHORTEN, AUSTRALIAN WORKERS' UNION: I've got no doubt that the change in power is the most drastic change in 100 years. It's giving all the power to the employers.

JENNY BROCKIE: How?

BILL SHORTEN: Well for instance this idea that individuals can negotiate equally with their employers is a fairytale. It is not that all employers are bad, on the contrary. But fundamentally if you're a 21-year-old shop assistant trying to negotiate with Coles Myer individually without the protection of 20 matters in an award or a union agreement you're in deep trouble. Or if you're in the bush you can't simply change jobs just because the employer gives you some bad conditions as the government would have you believe.

JENNY BROCKIE: Scott, you were nodding your head there, you work in a supermarket, don't you, how would you feel about striking up an individual agreement with your employer? Do you work under an award at the moment?

SCOTT SIMS, SERVICE ASSISTANT: Yes, I work under an EBA. I would have some difficulty in approaching my employer with an AWA because -

JENNY BROCKIE: An AWA we should explain is an Australian workplace agreement which is an individual agreement in this case, you're talking about it?

SCOTT SIMS: Yes it is, as a casual employee my boss could tell me I don't have a job within three hours so me negotiating an AWA would be difficult. I could lose casual penalty rates which would have an effect on my income of about 50%. My income I use to pay things like TAFE fees, it would affect my education and my way of life.

JENNY BROCKIE: So you feel you could be a big loser out of these changes?

SCOTT SIMS: Yes.

JENNY BROCKIE: Mike, you have a different view, haven't you?

MIKE O'HAGAN, BUSINESS OWNER: We have an AWA in our workplace.

JENNY BROCKIE: You run a removalist company, is that right?

MIKE O'HAGAN: Yes, we have a company in Brisbane. We do short distance furniture moving. So we employ removalists people who move furniture. Our award which traditionally covered us is all about driving trucks which is not what we do. So we put an AWA in place which gave our people a career path. They come in on an award rate as a trainee and then we step them up very steeply through different things as they learn the skills of the job to a much, much higher pay and it's worked for us tremendously. We've nearly doubled our workplace in the last three years since with put it in and our turnover has slowed down.

JENNY BROCKIE: What's it meant for your employee's conditions and terms?

MIKE O'HAGAN: They're getting more money and they're happier.

JENNY BROCKIE: Tiffany you were expressing a bit of concern then when Bill was saying it was going to disadvantage workers, you're a truck driver, is that right?

TIFFANY LYKKE, TRUCK DRIVER: I'm a truck driver and I would have great difficulty walking up to my boss and saying this is what I want. I work in a fairly large company and -

JENNY BROCKIE: Why would you have difficulty doing that?

TIFFANY LYKKE: Because there's that many truck drivers out there that if I say "I want this " and they say "Sorry, we're not going to give you that" they'll just employ somebody else. Unless you have specialist skills then you really have no power to bargain.

JENNY BROCKIE: Tony Steven do you agree with that? You represent small business. Does this shift the balance of power to the employer.

TONY STEVEN, COUNCIL OF SMALL BUSINESS: I think it realigns the balance of power. If truck drivers are able to - unable to negotiate on - by themselves, well there's nothing in the law that doesn't stop them from collective bargaining in the future as well.

JENNY BROCKIE: Bill, you don't agree?

BILL SHORTEN: I've got 27 Boeing mechanics who fix F-18s in Newcastle. Boeing is a giant company, $59 Billion company, American. 27 workers have picked to be in a union, they would like the union to negotiate with them. They can't negotiate, the Boeing won't deal with us. This idea that individuals can simply choose to have a union and the employer will simply say thanks very much, that again is another fairytale.

JENNY BROCKIE: Peter Hendy, a response to that?

PETER HENDY: Talk about fairytales, read the legislation. The legislation today is that it is against the law to oppose anybody belonging to a union or using a union to represent them. That will be the same under the new laws and so the fact is that you're talking about a fairytale there. The fact is that anybody, even if they want to negotiate an AWA, can use the union that they belong to, to negotiate it for them.

JOHN BUCHANAN: There is a difference though to other countries. In other countries where 50% of the work force, plus one vote to be represented by the union, the employer must deal with the union. Australia is one of the few countries in the OECD where the employer can pick the bargaining area.

PETER HENDY: And Australia is one of the few countries, in fact the only country in the world where we have the Australian Industrial Relations Commission with an award apparatus protecting the workers in Australia .

JOHN BUCHANAN: Which is slowly rotting.

BILL SHORTEN: Let's be careful about saying that my stories are fairytale, you can visit the picket line right now, it's day 160 of a story you say can't happen is happening.

PETER HENDY: Well I'm sorry but your representing them.

BILL SHORTEN: Sorry but Boeing doesn't have to deal with us. Come visit with me.

JENNY BROCKIE: Peter Hendy, is part of this legislation about shutting the unions out because it is making it more restrictive for unions to be able to go to workplaces, for example, isn't it, about having to give notice and having to do all those sorts of things before a union turns up at a workplace?

PETER HENDY: What it's doing is reducing union preferment in the legislation but it's not anti-union.

JENNY BROCKIE: Matt Casey, you're a former cop and I'm interested to ask you whether you would have been confident negotiating individually as a cop. An agreement with your employer?

MATT CASEY, SOCIAL WORKER: I might have struggled around it. I was actually on the union executive for a number of years and I actually dealt with lots of people in that time, members of the union who would come to me over an industrial issue and those are brave people with medals on their chest and they would simply quail at the notion of confronting the boss around anything about their industrial entitlements. It's just ridiculous to suggest that people can go and do that.

JENNY BROCKIE: Are there people who can go and do that? Are there people here who feel confident about going to negotiate?

KEN PHILLIPS, INSTITUTE OF PUBLIC AFFAIRS: I do it all the time.

JENNY BROCKIE: Oh Ken Phillips, you're a great supporter of the changes, you would say that.

KEN PHILLIPS: It's a normal process of life. 28% of the private sector work force have jumped out of the employment, and now are independent contractors and their daily lives are negotiating and organising their own work arrangements. Recently I dealt with a fellow who has worked for a small club for 20 years as their grounds keeper. He's up for his long service leave, six months long service leave, wants to take three months of it and get the other three months of it paid to him in cash. The people at the club say that's fantastic, we'll go and do it yet they check the law and he's not allowed to do it under the award. Now he's being denied his right to organise with the people he works with how to take his holidays. Now that's just an absolute taking away of his basic human rights and this is what's happening all the time and this is what we tend to forget because it's these very simple examples that show what's wrong with the current system.

JOHN BUCHANAN: We've got to be careful with that because what's smart with one can be dumb for all. And everyone starts

KEN PHILLIPS: Why should he be denied the right to take three months of his long-service leave as cash? That's just stupid.

JENNY BROCKIE: John, to be fair, isn't this about individual agreements so it's not for all. I mean if one person wants to do that, what's wrong with that?

JOHN BUCHANAN: The whole point is labour markets are not simply aggregations of individuals or a collection of individuals, they represent social norms and as you start to undermine the norms and the customs around taking of leave, you start to get a society which has a working time problem and our society has a very, very serious working time problem. Full-timers are working longer hours, fewer people actually taking holidays and if you give people an opportunity to cash out then they will simply do so because they're so desperate for the money. The reason you have public standards in a labour market is to ensure as productivity increases we can be more civilised by having common time.

JENNY BROCKIE: Peter, I'm just interested to ask you about this because the changes do see things like overtime and penalty rates potentially up for grabs, holidays potentially cashed out if people want them cashed out.

PETER HENDY: And they can be negotiated today. It's not like this legislation is creating any new arrangements with respect to that. John, I must say, some of your statistics do perplex me. We just went through about 18 months ago an hour's test case at the Industrial Relations Commission and you just said that full-time workers are working longer hours. Well they found exactly that that was wrong.

JOHN BUCHANAN: That is not true. I did a lot of research for that.

PETER HENDY: They found actually over the previous seven years, actually it had fallen.

JOHN BUCHANAN: The point is what's happened over the -

PETER HENDY: That's your independent umpire decided.

JOHN BUCHANAN: The independent umpire actually used our table which shows how you understand the structure of working time arrangements in Australia and the fundamental structure of that table showed over the last 20 years Australia has drifted from being a world leader in having shorter hours of work to being one of the worst countries in the developed world for having long hours of work.

JENNY BROCKIE: Bob Hawke, what do you think about this whole area of overtime and penalties and public holidays and so on.

BOB HAWKE: I wish we would get down to the real world and not talk about this from the comfort of these employers' arm chairs and the beautiful easy situation. Why don't we get down to the real world, the kids who are coming to go and get a job. You think that they can negotiate freely with their employers. Mr Andrew say said they can bring along their accountant. How many of these kids have an accountant to bring along. What nonsense. The reality is what we should be talking about. Not this theoretical stuff that the employers talk about. You're talking about kids who could be faced with a situation where the employer says - and just remember this where under the existing situation they have awards which provide them - listen to the list - public holidays, that's including Christmas Day, Anzac Day, Good Friday, New Year's Day, Australia Day, meal and rest breaks, weekend loadings, overtime payments, penalty rates, shift loadings, redundancy pay, all allowances, annual leave loading, roster protections. This employer just hands a document, he said I'm taking all those away, you're not getting those and you're not getting any monetary compensation and this government says that's a fair thing. That is nonsense and that, my friends, is why the whole spectrum of the Australian churches is saying this is immoral and they are absolutely right.

JENNY BROCKIE: Peter Corish, you're response. Few people wanting to clap up here. Peter, yes.

PETER CORISH, NATIONAL FARMERS' FEDERATION: Let's just get back to reality for a minute. We've got virtually record employment rates in this country, unemployment is extremely low. I live and operate in rural Australia and we have labour shortages, skilled labour shortages and unskilled labour shortages. We've been operating in my business on workplace agreements for a number of years and we do have young people come and work for us and they don't have experience. But any employer who hands someone a contract that Mr Hawke was trying to allude to a few minutes ago and say you've got to work under these conditions or you don't have a job, there are plenty of other jobs out there at the moment. That kid is not going to sit there and work under those conditions. We found those workplace agreements work extremely well in our situation and we have a lot more flexibility in the system and that's what I think the key thing that these reforms are going to deliver for all Australians.

JENNY BROCKIE: Scott, you would disagree.

SCOTT SIMS: I disagree with that. I watch many new people come into work and get employed and I know my employer would not sign new people up if they wanted AWAs. It's simple. You just wouldn't get it.

TONY STEVEN: From a small business point of view I can assure you that we are having trouble getting the skilled staff in this market place. As the prime minister has said it is a worker's market and we're paying way above award rates in many areas. As far as I understand it 7 out of 8 employees in Australia are currently above award rates.

JENNY BROCKIE: That's well and good in a time where there's low unemployment, what happens if the economy changes? What happens if there's a downturn?

TONY STEVEN: My council members have indicated that concern to me. Aside from that, looking into the future, we're being told at the moment that there is going to be a shortage of workers as many of the baby boomers retire into the future. So where are we going to get the skilled workers to operate in our businesses in the future if that's going to be the case?

JENNY BROCKIE: John yes.

JOHN RYAN, AUSTRALIAN CATHOLIC COMMISSION: Jenny, what about those with low skill, those coming out of unemployment looking for work? We're being told that a major thrust of these reforms is to create more employment opportunities, we're being told that the minimum wage is too high. I would like the employers to tell us how low the minimum wage needs to go to create jobs. I would like the employers and the Government to tell us how the public purse is going to support low paid workers and their families if the minimum wage has to decrease in real terms over time. What is the balance between the wage packet and the public purse that is needed? What we need in this country is an integration of wages policy, taxation and welfare reform.

JENNY BROCKIE: Peter, how low would you like the minimum wage to be at the moment ideally?

PETER HENDY: It's exactly the wrong question. The fact is that is that we don't want lower wages in this country, we want higher real wages.

JENNY BROCKIE: At the moment it's what $12.

PETER HENDY: I understand this. These reforms follow on reforms that have delivered the lowest unemployment rate for 30 years and one of the longest sustainable increases in real wages for decades. If you want to maintain that, if you want more real wage growth you've got to have reforms that allow productivity to match wage growth, nominal wage growth. I know it's economist speak but it's actual fact. All those who have been involved in government over the years knows the formula works. If you want to maintain real wage growth which I think is everyone in the room, and you want to get unemployment down further than it is today, again which I think is everyone in the room, these sorts of reforms are necessary.

JENNY BROCKIE: Bob Hawke, you've been involved in government over the years, what do you say to that?

BOB HAWKE: Look, what I say is that Peter Hendy is just uttering platitudes. He condemns his argument out of his own mouth. If it is the case that we have one of the strongest economies in the world, which the Minister, was the phrase he used in introducing the second reading, one of the strongest economies in the world, and we've got rising real wages, that has happened under the existing system. Why, if it is working, if it's produced the strongest economy in the world with rising real wages, and that's happened in a situation where the cooperation of the Australian trade union movement produced the reforms, which has created that situation, why do you have to change it? They have shown a preparedness to cooperate with government in a constructive way, as have employers. That's what we did when we came in.

PETER HENDY: I don't know what recent history you're thinking about Mr Hawke, but the fact is that the union movement has opposed all these reforms since 1993. So I don't know where the cooperation is that you're talking about.

BOB HAWKE: Well the cooperation I'm talking about is when we were there, when we reformed the economy.

PETER HENDY: No, the other thing is that yes, we have the lowest unemployment rate for 30 years, that's 5.1% of the economy - of the labour market. But that's 540,000 people. That's over half a million people in the dole queue. That's a waste. We shouldn't be putting up with the fact we have 500,000 people on the dole queue and in fact for those who want to work longer hours or involved in more work, the number of underemployment goes up to 1.2 million people. If you want those people to have the fullest opportunity, you need reforms like this to do that and that is the sort of thing that helps poor people, it helps the low income, it helps the welfare.

JENNY BROCKIE: Quick response from you, Bob.

BOB HAWKE: The reforms I was talking about were the economic reforms, the basic reforms, floating the dollar, bringing more banks in, lowering tariffs. They were the reforms which we were only able to bring about with the cooperation of the trade union movement, and you know that's what I'm talking about. Now your crocodile tear for the poor, let's face the facts. The ACTU has taken these minimum wage cases before the commission on every one of them, you, Peter, your organisations and the Howard Government have opposed those applications in every case. If the Howard Government had had its way, the minimum wage today would be $50 a week lower than what it is. Their submissions and your submissions were not able to persuade the independent arbitration commission to bring about your starvation wages. They rejected your arguments. Now because that's not good enough for you, you're going to take that power away from them. Now that's what you're about - to reduce wages for those least able to look after themselves and you've got the most enormous temerity to come in here and say you are concerned for the poor. That's why these good people here from the Salvation Army and the churches, the whole spectrum of churches are saying this is immoral.

JENNY BROCKIE: OK, John Ryan, you are concerned, I know, from the church perspective about this new fair pay commission which is going to determine these minimum wage conditions and so on. What is your concern about that? What's the problem?

JOHN RYAN: For much of our history when we've been setting wages policy we've had a concern not just about the individual worker but also their dependants, their families. We know time has moved on since Harvester. We have family support systems, we have a taxation system. The fair pay commission in its charter doesn't talk about the needs of the low paid, it doesn't mention families, it doesn't mention fairness. What we want to know is where - how are families going to be supported if the minimum wage is going to be set on the needs of the individual worker and dictated to by market place realities, who is going to support the families of workers?

JENNY BROCKIE: I know that the new head of the fair pay commission, Ian Harper, said that he brings his Christian faith to everything he does. I saw a quote from him where he said he would be bringing those values to that job. That doesn't reassure you?

JOHN RYAN: You have to look at the charter of the commission. It doesn't matter what any individual brings to that commission in their capacity as chair or whatever role, they have to work within the charter of the commission.

JENNY BROCKIE: Peter Corish, do you have a response to that?

PETER CORISH: Look, I think simplistically I know, but families who believe they will be disadvantaged by these reforms, I think need to have a better understanding. I know that's difficult but they do need to have a better understanding of the minimum standards that have been set. Certainly our understanding of the legislation, our perusal of the legislation, in our view, makes sure that the basic disadvantage test should ensure that those people are not worse off under these reforms. I really think we've got to try and look at this whole situation in a proactive way and try to look at the positive outcomes and try and look at these reforms as a way forward. In a global market place that is changing. As Peter Hendy said, we've introduced reforms, a lot of them introduced by the Hawke and Keating governments. The only area we haven't touched on is workplace reform. It's time to look at it and look at it in a positive way.

JENNY BROCKIE: Sylvia, you're a cleaner and work two jobs. Can you describe the hours you work and the penalties you get.

SYLVIA CULLEN, CLEANER: 2:00am to 6 am and 2:00pm to 7:30pm, five days a week. To do the 2am to 6am you get the minimum rate of pay and you get a 25% penalty rate. Now who in their right mind would really get up and work those hours for just the flat rate? The 25% penalty rate picks up the wages and helps me out. Then people get travelling allowance and things like that. If you lose that, I'm from Goulburn in the bush and basically petrol down there is nearly $1.40 a litre, you need that to survive and that extra money in your wages every fortnight is the difference between the next loaf of bread and milk for your family.

JENNY BROCKIE: What about the - the argument is you have bargaining power because there isn't a lot of labour out there at the moment.

SYLVIA: If my employer was to give me an AWA and say if you don't accept that Sylvia, basically you haven't got a job. Now in Goulburn, the jobs are very limited so to become - if I walked out of cleaning tomorrow it wouldn't be what I know in Goulburn, it would be who I know and I'd have to agree with their AWAs to work in that system. It makes it very hard for low income earners in country areas because we haven't got the child care facilities that are around in Sydney to provide for the child care because I'm a single parent and if I didn't have family in Goulburn I wouldn't be able to work. But I want to work for a living other wise I could get a pension but I want to work for a living and provide for my family.

JENNY BROCKIE: Let's move on to another area, this whole area of dismissals. Peter Hendy are these changes going to make it easier for business to dismiss people, to get rid of people if they don't want them for whatever reason?

PETER HENDY: Well, as we know there's going to be an exemption for small business where a small business is small or medium sized businesses are defined up to 100 people. So there will be an opportunity to terminate employment easier than it is today. That's true. But the fact is that also those unfair dismissal laws that were introduced in 1993 have actually kept people out of work because if you know how small business is run, particularly small businesses it has made them reluctant to employ staff at the margins.

JENNY BROCKIE: This has been a problem, hasn't it Bill Shorten, wouldn't you agree? unfair dismissal laws have been a problem for small business? But it has made it very difficult for some small businesses. We've seen examples of cases where they haven't been able to get rid of people who perhaps deserved to lose their jobs for whatever reason.

BILL SHORTEN: The whole debate about small business and unfair dismissal is a complete beat up. The simple question to ask is why should you have second-class rights just because of the size of your employer? After all, why is conduct if you work with a company of more than 100 people deemed unacceptable by the employer to the employee merely because of the size of your employer. The same conduct with less than 100 becomes legal. You can't be half pregnant. The point about it is you're a worker you should have the same set of rights and by the way, if the Government is so fair dinkum about small business, why is it they don't give them tax holidays, why is they don't give them a whole lot of other things. Why is it... the only thing they want to stand up for small business is when they can do over the worker. Small business needs to be really careful about talking out of both sides of their mouth by the government who doesn't help them with anything else.

TONY STEVEN: This is a good example of overarching policy that doesn't fit every circumstance. Trying to implement that on small business just makes it totally unfair. I stand by the fact that I believe that small businesses will employ more people. I don't know how many but there certainly would be more people taken on. In fact I think there's a good opportunity without the threat of go away money having to be paid for small businesses to place casuals and part-timers on to permanent payroll because they will be more confident to be able to do that and there will be more flexibility with the opportunities of the new IR system.

JENNY BROCKIE: John, what do you think?

JOHN THORPE, AUSTRALIAN HOTELS ASSOCIATION: I'd have to agree because in my industry, which is 24/7, the hospitality and hotel industry, you know, if you're working weekends you can earn as much money as somebody working Monday to Friday. There again in my industry on a public holiday with treble time, you can't charge treble the price for your bed or your beverage or your food. We've had a massive problem with this and you know, it's got to be made fair for everybody and there's over 500,000 workers in that industry and you know it's been complicated for us. Don't talk about the union because the union only represents 8% of my work force. They have declined and remember in the recession periods where was the union? I was there working but we had to protect the jobs of those we had staff and we kept those staff and you know, at sometimes somebody forgets all those issues and in my industry it needs reform and it needs it now.

JENNY BROCKIE: Roger, I would like to bring you in at this point, you're the director of the New Zealand business round table. Now the New Zealand labour market was dramatically deregulated in the early '90s, how do these changes that we're looking at now compare to what you did in New Zealand?

ROGER KERR, NZ BUSINESS ROUNDTABLE: I think you're going to have a law which is considerably more complex than was introduced in New Zealand. Essentially in the 1980s the Labour Government failed to address the labour market issue. We were restructuring the economy in a big way. It was very difficult for firms to restructure and for people to find jobs when they got laid off. It wasn't until the early 90's when the labour market was freed up that we really had a coherent framework. The economy grew very strongly since that point. In the labour market in fact, we had a rate of unemployment of 11% in the early '90s. It dropped within 5 years to 6%. We're now down to 3.7%.

JENNY BROCKIE: You did a lot of other changes at the same time as well?

ROGER KERR: Sure, but the labour market was the one that was not addressed and that made the whole transition a lot more difficult. Ironically it was criticism from those who pretended that they were on the side of the more vulnerable in the workplace who blocked those kind of changes. I mean, it's a freer labour market that allows people to get jobs in the first place. Our Maori unemployment rate rose to 25% by the early 1990s. It's now down to 8% and still falling and you can see in France as we speak today, the hopelessness of people who just don't have a chance to get a job at all. So those that are concerned about them should be really on the side of making the labour market freer.

JOHN BUCHANAN: No they should be on the side of those who are interested in creating quality full employment. This argument about globalisation has to be confronted head on. Six of the top nine most competitive economies in the world have high rates of unionisation and high labour standards. Countries like Norway and Denmark and there are other ways of inserting yourself into the global economy than following the New Zealand route. The punch line for the New Zealand experience is that, since the employment contracts act, its rate of labour productivity growth has been slower than the Australian rate of labour productivity growth. When you create low paying jobs you create an incentive for employers to create low productivity jobs.

ROGER KERR: No that's just rhetoric. We had a rate of unemployment. We absorbed a lot of low skilled workers. You would not expect wages for those people to rise rapidly when the labour market was so slack. In more recent years as the labour market has tightened, wages have risen for those low skilled groups as well. Employers are screaming out for labour. It's not unions or collective bargaining that supports wages, it is productivity, and employers need workers as much as workers need jobs.

JENNY BROCKIE: Bob, I'd like to bring you in here, you were prime minister when New Zealand underwent its changes, what do you think of the outcome there?

BOB HAWKE: I think some of the economic reforms they made, made sense but I certainly disagreed with what they did in the labour area. I wonder if we could just get down to helping your listeners to understand the sort of levels of wages we're talking about when we're talking about the minimum wage. And what this Government and these employers want to do to bring it down. The current minimum wage is $484 a week. Now can your listeners understand that? This is a bloke or woman out there working wanting to do something for themselves and their kids with - because of the background, no particular skills, they're doing the best they can - $484 a week. If the Howard Government had had its way, and the submissions they've put, that would be $40-$50 a week less. Instead of 484, it would be 434. Now, the Government and Hendy and these people went in there, argued against the ACTU, wanted to get a lower minimum wage, they couldn't force the wages down and get these poor damn people working at even less than this miserable rate now. They couldn't get it down lower. So they're going to abolish the system under which the arbitration commission had a binding principle and that was that they would maintain the real value of the minimum wage and as the economy got stronger and grew in real terms, these people would get a share of that growth. Now that is what a decent Australian society, a fair go society is about. But they couldn't get their way to push these people down further and further so they get rid of that and establish a commission which has no legislative requirement at all to maintain the real value of that miserable wage.

JENNY BROCKIE: Peter Hendy, your response to that, isn't it true as opposition to every one of those increases.

PETER HENDY: To respond the fact is it's not true. The fact is it's an Australian fair pay commission, it's got a floor under which you can't reduce real wages, the fact is you've got a centralised tribunal in Australia that will be protecting the minimum wage. And so I don't - there's a lot of extremist rhetoric going on here and there's a scare campaign as if we're abolishing the setting of the minimum wage, as if we're abolishing Australian Industrial Relations Commission as if we're abolishing the awards system.

JENNY BROCKIE: But the Australian Industrial Relations Commission has had its powers stripped right back.

PETER HENDY: They're all there protecting the worker.

BOB HAWKE: Is there any requirement on this fair pay commission to maintain the real value of the wage as the economy goes stronger? The answer you know, Peter, there is no requirement whatsoever. And the reason you've done it, and why the Government has done it, you couldn't get your way. You put your arguments before the independent commission, which is there not appointed at the whim of the government for five years, but there for life, totally independent, you couldn't get your way with your arguments with them to push this wage down further, so what did you do? We'll get rid of that because we can't get the wage down low enough. We'll create another commission.

JENNY BROCKIE: Peter a response.

PETER HENDY: It is an independent commission, it's the Australian fair pay commission, it will be setting the minimum wage. The fact is actually that my group, the Australian Chamber of Commerce and Industry has been arguing for minimum wage increases which would reflect maintaining a real increase in minimum wages over the last 10 years or so, so the fact is that the argument you're putting is not actually accurate.

BILL SHORTEN: Hang on, that isn't correct. These guys are playing payback politics merely because they didn't get their way. The employers have never argued that real wages should move at the pace of inflation. What Peter actually said is they think the real wage should be maintained. The only way you can maintain the real wage is if it doesn't get eaten away by inflation. There's no guarantee the minimum wage will increase as fast as inflation. What upsets me in what I'm hearing is it's a cheeky argument. The unions have been doing the bargaining and it's alright for the bloke from the hotels saying the unions are bad, this and that. Who gave us superannuation? The employers never supported compulsory superannuation, it took the bloke on the screen in Adelaide to deliver that. And the unions, they've never supported us when they we pushed for long service leave. Do you know, if New Zealand is such a paradise, why does everyone in New Zealand want to come and live in Australia?

JENNY BROCKIE: Roger, there's a question for you.

ROGER KERR: There's a number of Australian firms that are relocating to New Zealand because of some attractions there. We want to be a more productive economy. Australia I would hope, aspires to US type rates, higher than Australia. The issue for us was many decades of mismanagement, part of which was a very regulated labour market that was very inimical to productivity. Our growth rate has matched Australia's more or less over the last 10 or 15 years, our growth rate has. By a very small fraction and you know, it's our objective to bridge that gap. You can't do that in five minutes.

JENNY BROCKIE: Let's talk about some of the other concerns too because there is also a concern about the broader social impact that these changes to industrial relations could have, especially the amount of time that families will spend together. Here is a TV ad that was produced by the ACTU.

ACTU AD:

JOHN HOWARD, AUSTRALIAN PRIME MINISTER: This Government has been the best friend that the workers of Australia have ever had.

MAN: I was offered a new contract at work. I have to work nights and weekends, no penalty rates and they want me to cash in two weeks holiday. I said to the boss, "I can't work Friday nights because the missus works, I've got to look after the kids and I coach the under-12s on Saturday," he just looked at me and said "There are plenty of other blokes in line if you don't want the job." I thought this country cared about family.

JENNY BROCKIE: Well Ken Phillips, do you think these changes put family life in jeopardy? Forget about the fine details there, but the idea of family life because that's something that has been raised as a concern.

KEN PHILLIPS: We've got a very odd system at the moment that does things, for example, that says we'll charge twice as much to work on a Sunday why? Presumably so that we all go to a Christian church on Sunday. That's the defining of our nation and the structure of our nation and the structure of our family life through the pay system. Very, very strange stuff indeed. Why can't people work on a Sunday if they want to work on a Sunday? Why do we have to have these systems like the shearers award that turns around and says this is what the shearers are going to have in their diet - meat and vegetables. This is a very strange system that through the labour arrangements tries to dictate to us, the people, how we're to lead our lives.

JENNY BROCKIE: Lady over here wanted to say something.

LISA: My name's Lisa and I'm from Adelaide. We come from a single parent family and we're both educating ourselves and I work full-time on weekends and night times so I can go to university during the day. Why should I give up my Sunday with my son for no extra wage? And I'd really like an answer to that because why should - and how am I going to get my university education without extra loading on Sundays.

KEN PHILLIPS: You shouldn't give it up but the question's not giving it up, the question is who makes the choice on this? Do we have some great big legal system that tells you what you can or can't do or is the choice yours? Now what we're going through is a huge transition. We had 100 years of being told by the legal system that we're not old enough to make our own decisions. My view is we are old enough.

LISA: And that's all very great in theory. I've heard all these theories but in practice I've already had my employer say right, this is what I'm going to do. I work in the hospitality industry. You might worry about your hospitality industry and well you may. But why should I work nights? I have my son at high school working at McDonald's from midnight to dawn on $8 an hour WHERE is his bargaining power?

KEN PHILLIPS: And I've got a son who's 15 working at McDonald's as well, doing exactly the same thing and the other day I walked down there and he was working too late and I didn't like that fact that he was working too late. I've got the same concerns as you. Don't go assuming that you've got the high moral ground and the people on the other side of the argument don't.

LISA: Maybe you have a wife, maybe you don't live in a single parent household.

JENNY BROCKIE: This man here, yes.

PAUL SCHOONE, REMOVALIST: I've been employed on an AWA for over two years now and the quality of my life and with my kids and wife has improved. I was referred to as a fairytale. I must be Cinderella because I went to my boss and said I want to work through my agreement. When they brought that in, we as a staff forme a committee, we went to him, we worked through our areas of concern with him before the final one was put in place. It's not a fairytale it does happen.

EMPLOYER: As an employer, I will employ more people. I will put more people on because with more flexible childcare, my staff and I polled 10 of my staff before I came along, and they're all looking forward to it for exactly the same reason. If I don't employ them and give them what they want, they will go and work elsewhere because they have the expertise.

JENNY BROCKIE: John Dalziel, I know you're concerned about the disadvantaged in our community and how these changes could affect them, what's your main concern?

JOHN DALZIEL, SALVATION ARMY: We've briefly referred to it already where we're talking about the fact that yes we've got 5.1% unemployment and that's the record for 30 years. But during that - during the last 20 years the Salvation Army has seen 1,000% increase in the people coming to us for assistance because there are more people who are falling behind in our society. I would love to see this debate broadened so we're not just looking at IR reform but we're looking at ways to employ those who are on a disability pension, those who are long-term unemployed. Can't we have infrastructure programs that only employ long-term unemployed and those who are on disability pensions? We're talking about another 1.3 million people who really do want to work and under whatever system you bring in, they don't have the skills to work and they should be given a chance. Let's see the debate broadened so that we're not just talking about reducing wages but we're talking about enlarging prosperity for everybody and especially the most underprivileged in society.

JENNY BROCKIE: Peter Corish, I'd like to ask you a question from the employer perspective here and we've heard a lot tonight about flexibility and about the need for more flexibility and so on. But the positive stories that we're hearing are stories from employers who have been good employers, they've been people who have looked to please their employees. What about having a bad employer who decides that they don't want to please their employees?

PETER CORISH: Before I get to that, can I agree with everything from that John just said. I think there are huge opportunities for us to employ people in the workplace in Australia, in the future, that currently aren't part of Australia's prosperity and I think that that's something that we should all focus on. Governments and industry and unions, I think we have a role to play in that regard. I'd like to come back to a comment that Bob Hawke made in an attempt to answer your question. Where Bob was talking about a minimum wage rate in Australia today of $484 a week. Now, in rural Australia we're traditionally known as low payers because of a whole lot of reasons. But I can't get anyone to work for me for $484 a week. We're paying significantly above the minimum rates. Whether I'm a good employer or a bad employer, we're going to be paying significantly above. I think there's too much focus in this debate on reduction in wages and reduction in conditions. I think we've got to focus on going forward. Look at the minimum requirements in the legislation and look at it objectively without the caremongering and let's go forward because I think there's some real opportunities for all Australians if these reforms are adopted.

JENNY BROCKIE: We are going to have to wrap up in a moment. Bob Hawke, I'd like to ask you one final question - what do you think the average worker's situation might look like in say five years in time in Australia?

BOB HAWKE: Well it depends on what the general economic situation in the world and in Australia is. But there is no doubt that given all other things being equal, the result of this legislation will be that those workers who have got skills and capacity to negotiate and bargain, they will be well off. The great concern I have is that the Australian character is going to be destroyed because what we've been about for 100 years, since we became the one nation of Australia, is that the power of government, the institutions we create should be there to protect the most vulnerable, the least able to look after themselves and there is no doubt that in five years time the least able to look after themselves will be worse off than they are and that's why the churches are so universally opposed to these proposals.

JENNY BROCKIE: Ken Phillip, what do you think it willlook like in five years?

KEN PHILLIPS: I think we've got a chance for better businesses, making more money, having more people working for them, earning more money. It's a scandal that this country has 5% unemployment, it's a scandal that we've got disabled people not earning the sort of money that they should be earning and we should be looking at having the best damn economy we could get with the best businesses running so we can have lots of people working.

JENNY BROCKIE: John just quickly, what do you think? What are we going to see in five years.

JOHN BUCHANAN: We're going to see a lot more diversity. Some people will flourish. There's no doubt some people will have more choice. But what is of more concern is that historically in Australia prosperity has been shared through institutions that are about to be undermined. What we're going to see is not the sky falling in but the floor rotting away and the rate of rot will depend on the conditions of the economy. The next recession will be a big thump.

JENNY BROCKIE: Sylvia, what do you think your situation could be like in five years?

SYLVIA: Well, low minimum wage earners I always remember John Howard did say that $10 increase was too much when they pushed for $26 increase so I'm basically classed as a blue collar worker. In five years time I'm sure the minimum wage will not increase and I'll be classed as a no collar worker because I won't be able to buy one.

JENNY BROCKIE: We are going to have to wrap up. I'd like to thank you all very much for joining us on Insight tonight. I know a few people still wanted to have a say but we have run out of time. Thank you to Bob Hawke in Adelaide, great to have you with us. Thanks for your time.