Australian Resources and Energy Group AREEA has led a coalition of Australia’s most influential employer organisations urging the Morrison Government to revisit important industrial relations (IR) reforms within this parliamentary term.

In a joint letter sent to Attorney General and Minister for Industrial Relations, Michaelia Cash, CEOs of AREEA, Australian Industry Group, Australian Chamber and Commerce and Industry, and Master Builders Association, voiced their strong view that ‘more functional and practical IR regulation’ should remain ‘of the highest priority to support Australian job creation during the post-pandemic economic recovery’.

The four participating employer organisations became known as the ‘Group of Four’ during the Australian Government’s IR working groups of 2020, referenced as such due to their high levels of cooperation and aligned reform priorities.

“We congratulate the Government for passing important casual employment changes in March,” the joint correspondence says.

“Those changes were critical for dealing with a pressing and serious threat to employment. However, with the IR framework placing significant restrictions and productivity barriers on businesses and the economy, more fundamental reforms are gravely overdue.

“(IR system improvements) would significantly improve the ability for businesses to invest, employ, pay higher wages, and generate new sources of taxation and resource royalties.

“These outcomes should be of the utmost priority as the nation emerges from the COVID-19 economic downturn and seeks to position itself competitively within restructured global markets set to be uncertain, unpredictable, and more competitive.

In such an environment, Australian enterprises should not be left fighting against IR legislation holding them back from reaching their full productive potential.”

The joint correspondence, which was coordinated by AREEA, specifically details the merits of three areas of the Fair Work Amendment (Supporting Australia’s Jobs and Economic Recovery) Bill 2021 which remain unlegislated after failing to secure support of the Senate earlier this year.

These reforms include the enterprise agreement making provisions (administrative efficiencies and 21-day Fair Work Commission approvals); Modern Awards (flexibilities around working hours, penalties and duties); and Greenfields Agreements for new major resources and infrastructure projects (see below).

Coverage of the correspondence featured in today’s Australian Financial Review (8 June 2021).

Six-year greenfields agreements back on the agenda

The joint approach from AREEA, AiG, ACCI and the MBA to the Attorney-General comes as the Morrison Government is reportedly considering re-prosecuting proposed reforms to the Fair Work Act’s greenfields agreements provisions.

The proposed greenfields changes, which failed to pass through Parliament in March, would allow for greenfields agreements on major resources, energy and infrastructure projects to have a maximum in-term duration of six years, two years greater than the current maximum of four.

Projects with construction-phase capital value of $500 million or more would be automatically eligible for the extended agreement terms.

The joint correspondence from the ‘Group of Four’ says such a reform would be ‘sensible and long overdue’, having been recommended in multiple previous reviews of the international competitiveness of Australia’s IR system.

“There is an enormous opportunity for Australia’s resources and energy industry to contribute further to the nation’s post-COVID economic recovery and higher living standards for generations,” the letter says.

“The Commonwealth Department of Industry has described the sector as being on the verge of “a new growth cycle”, with 335 potential new major projects worth approximately $334 billion in Australia’s investment pipeline.

“If all this investment could be secured, the job creation would easily exceed 100,000.”

The correspondence also notes all greenfields agreements, including potentially those with extended durations, require agreement from at least one union.

“This simple and uncontroversial change would provide certainty around cost and timing of world-class infrastructure, resources and energy projects which deliver significant employment and economic opportunities throughout the community,” the letter says.

Improvements to Australia’s greenfields agreements system has been a longstanding top reform priority for AREEA, with the Group having led calls for extended terms covering the ‘life of project construction’ for over a decade.

Members seeking more background information on greenfields agreements should refer to AREEA’s comprehensive 2019 submission on the matter.

For further information or to get involved with AREEA’s IR advocacy activities, contact [email protected].