Complex rules ‘suffocating’ workplace relations system: BCA
Australia’s workplace relations system is causing confusion and errors in payments and must be overhauled, says the Business Council of Australia (BCA).
The current workplace relations framework currently covers 122 awards and thousands of pages of detail and is “suffocating innovation” the BCA has said in a recent report.
In its Seize the Moment report, BCA said across the 122 modern awards there are more than 1,200 minimum wages prescribed.
Some awards also contain more than 400 separate classifications, each of which generate dozens of separate wage obligations depending on where someone works.
“The pay summary for the Manufacturing Award is 206 pages long and identifies more than 10,000 separate hourly minimum wage rates,” said BCA.
“The General Retail Industry Award is subject to a 29-page pay summary, which contains 1,515 separate hourly minimum wage rates.”
The current framework also fails to reflect the way many Australians choose to work today, according to BCA.
“Work-from-home arrangements are not included in most awards yet are now an important feature of many workplaces,” the report said.
The report said the myriad of workplace relations structures in the current system should be replaced with a clear framework based on minimum standards that provide a simpler and more enforceable safety net.
Australia’s workplace relations system should also have fewer awards applied more broadly, with clear minimum wage structures and allowances.
“Enterprise agreements [should be] the primary means of determining workplace arrangements, which are easy to make and approve, driven by collaboration and reward for effort, and support flexibility and innovation for workers and businesses,” the report said.
BCA said implementing national employment standards should be the starting point for the workplace system which would provide minimum workplace entitlements for all employees.
“Standards should be clear and simple, so all employees and businesses can understand them,” the report said.
“The award system must be substantially simplified, with fewer instruments prescribing fewer separate minimum wage rates, and far simpler application to hours worked.
“Awards should be refined to focus on the terms of employment, wage categories and allowances, and away from non-wage conditions. They should be in plain English and able to be clearly understood and applied by businesses and employees. Ideally, they would move towards becoming descriptions of classifications and schedules of current minimum rates and allowances.”
BCA has also called for outdated restrictions and concepts of work to be removed to enable greater flexibility to support new ways of working.
“A good starting point would be to ascertain where most payment errors are happening due to the complexity of the system. This would directly benefit employees and employers by ensuring more accurate payments and minimising the risk of inadvertent under and over-payments by business,” the report said.
BCA said it was also important that Australia's workplace relations system allows businesses to be able to scale up and scale down their operations to meet demand and source the skills and expertise they need in a changing business environment.
“The development of tech-based service platforms across multiple industries has significant productivity benefits, enabling better matching between firms and their customers, non-standard work arrangements and flexibility for workers who desire it, as well as increased competition. These service platforms have developed in response to consumer demands such as food home delivery, greater choice and independence in managing their own care services, or the improved quality of ride share over other transport services,” the report said.
“While there is a role for minimum standards that reflect the specifics of a sector, they should not be so overly prescriptive as to restrict ideas and innovation.
“It is impossible to conceive of the range of businesses that will develop in coming years. What we need is a simple workplace relations framework that acts as a springboard for ideas to evolve and businesses to grow, not one that contains them within regulations that fail to meet the needs of businesses, workers and consumers.”
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