Hello and welcome to the BRR Legal Brief, bringing you the latest legal issues affecting corporate Australia, I’m Kate Ritchie.  Well last week we saw the review of the Fair Work legislation, Labour’s industrial relations system.  Joining me to discuss is Joe Catanzariti who heads up the Workplace Relations team at Clayton Utz.  Joe welcome to the studio.

Hi Kate.

Well Joe firstly I’d like to look at the Panel’s overall impressions of the legislation and its impact on productivity.

Well let me put it first into context.  This was a review that was planned within the legislation, so it came as no surprise that we’re having review, it’s not like you know there was all this burning pressure in terms of the problems with the system.  So what the panel did of experts is they came up with 53 recommendations, and they also made comments about the fact that you know some of these things need to be tested yet, in terms of judicial thinking and all those decisions haven’t come out yet so that they’re looking at it as a snapshot where it is right now.  They did comment however about productivity, and they said that to dispel any myths about it in effect, yes Australia’s productivity has fallen but they don’t view the legislation as being responsible for anything to do with productivity.

Well Joe you’ve mentioned 53 recommendations, what do you see as the key recommendations?

What I’d like to do is highlight just a few of them.  The first I’d like to highlight is really the Greenfields Agreements.  Now this is a very important because we have obviously the boom in mining and construction within Australia.  The Review Panel had a good look at this and they thought of the current drafting of legislation did lead to some anomalies in terms of Greenfields.  So to avoid the problem where you’re negotiating a Greenfields agreement, and an impasse comes into being they’ve put in a limited arbitration, so that’s good it means that projects can’t be stalled while all these things are dragging.  That was the very first and significant point and I think everybody can be quite happy about that sort of development.  The second thing that they dealt with was industrial action, and this really relates to the JJ Richards decision, the issue becoming you know at what time can industrial action be initiated.  It was the Review Panel’s view that there needs to be bargaining, we can’t have a situation where industrial action is happening and the cycle hasn’t commenced, again I would say common sense prevails.  The third point which was interesting because really its related to the Barclays decision, and it’s unusual to actually have a High Court matter moving along and a review panel recommending, if you like, how to fix the system.  And of course whatever the High Court decides the High Court will decide on the law as it is, the review panel is talking about the future.  The Barclays matter is extremely important because what they’re going to do if the recommendation is accepted of course is say really in terms of these matters where you had situation in Barclays of the union official and performance management issues, they’re not going to allow tribunal to sort of second guess the honest intention of the employer.  So they’re going to back to a subjective intention of the employer and if the employer is able to give reasons as to why it is they did act in relation to that performance issue it won’t automatically follow that it must of course be union official, so its redressing that sort of balance, which I thinks pretty significant.  The next matter I want to deal briefly is individual flexibility agreements.  Now a lot of discussion about individual flexibility agreements, there’s an issue as to have they been taken up or they haven’t necessarily, the Review Panel was concerned that there was an attempt to sort of, in some agreements to bargain away individual flexibility agreements, so they have come down hard on that and they’ve said no we don’t want that to happen recommended that you know you can’t actually bargain away the individual agreements and secondly they’ve changed the time limits from 28 days to 90 days on termination, that’s also quite good thing.  And finally unfair dismissals, there’s a lot of debate on unfair dismissal because clearly under Work Choices that was really the sort of the big debate, they’re not going to the heart of unfair dismissals in the discussion points, there are two recommendations.  The first is really to link the general provisions part of the legislation, the adverse action etc to have the same sort of timing as unfair dismissals, that’s pretty good, actually to have that sort of you know common approach because different time limits causes confusion for employers and for employees as well.  But secondly and this has caused a bit of controversy in the media in the last couple of days really, is that they’re talking about a cost jurisdiction being imposed where a party is vexatious or frivolous or doesn’t settle the matter, which could otherwise been settled, and that of course will cut both ways.  And I think you know in the end that’s a sensible, pragmatic recommendation.

Well Joe you’ve mentioned some of the recommendations that you see as key, were there any things that you think were left out that should have been addressed by the review?

Now we’ll all have different views on that but the one area that I think that business would want to have a bit more on perhaps is really the transfer of business provisions.  They’ve limited their recommendation to a very narrow area and it really deals with the related entity where an employee is voluntarily moving from one entity to the next and they’ve said well in that situation we should have all the complex transfer of business issues.  What they perhaps could of done is have a bigger debate on the sale, purchase, all those other issues in transfer of business which is still very complex and very cumbersome and come up with perhaps some more thinking on that, but they’ve acknowledged its complex but just haven’t actually done anything about it.

And Joe I’d like to look at arbitration.  One of the issues for employers is access to arbitration during industrial action, and of course last year we saw Qantas ground its fleet in order to terminate industrial action, what was the Panel’s recommendations on this issue?

Well the Panel not surprisingly hasn’t come out and said let’s go back to an arbitration system.  They specifically refer to the Qantas matter, it’s acknowledged and in general terms they thought well the system works right.  They have perhaps controversially recommended that the Minister’s intervention ought to be relooked at in terms of the Minister should actually have the ability to interfere and stop it because of a view that might be political interference.  But apart from that they’re quite satisfied with the way the arbitral system kicks in, in that sort of dispute.
Well of course everyone wants to know what are the next steps; do you think we’re likely to see law reform in this area off the back of the review?
Well we are in an election cycle and clearly this is a review.  Now the review doesn’t mean that what the Panel recommends the Government has to endorse, it’s no different to review on any other piece of legislation and the Government will have sit down, analyse it, it will no doubt discuss it with first of all internally, then there will be a debate with stakeholders, there’ll be submissions, and we’ve already seen in the last couple of days some employer groups come out with their own views of the review, these things are going to take a bit of time, then there’ll be negotiations with the Independents, who knows it may be that we don’t get significant changes before the election cycle’s finished.

Joe thank you so much for joining us in the studio.

Thank you.

And viewers thank you for joining us as well.  We hope you can join us next week for our Legal Brief.