The amount of regulation of the employment relationship should be reduced. This paper focuses on regulation such as: minimum wages, age of work, holidays, insurance, as well as working conditions.
The recent changes in Australian employment policies have increased the power of employers but have not gone far enough to regulate the relationship between employees and employers. Work place relations amendments also known as work choices act 2005 places limits on the Australian industrial commissions’ roles and powers.[1]
In what has been viewed by employees unions as an infringement on workers rights, Howard’s government interference in the labour sector in Australia by enacting the work choices act of 2005 in disguise of empowering employees in making work choices is threatening to rip apart the positive employment relationships which the country has enjoyed for the last few decades.
However it has turned out that the amendments to the employment act contained serious flaws which have since threatened gains attained for the past one-century in as far as the employees rights are concerned. Government interference in the affairs of the employees is not unique to Australia. Only recently, the United States of America witnessed one of the most far reaching government regulations, contained in the Sorbonne Oxley act of 2002.
Although, the government of the United States of America had defended this policy arguing that it was going to empower the business community and spur economic growth, several years down the line, the real impact of government interference in labour matter is being felt in terms of the burden the Sorbonne Oxley act placed on business community.
The Howard government failed to draw from the experiences of the united states of America and perhaps desist implementing the work choices act of 2005 or amend it by encouraging participation by all key stakeholders particularly employees union.
State regulation of the employment relationship should be maintained to the extend where by such regulation does not hurt any party involved. The work choices act of 2005 had far reaching consequences particularly on the employees, this is because the work choices act dramatically reduced the bargaining power of employee union and empowered employers thus giving them an upper hand in contract negotiation.
Although in 1996 the coalition government had accomplished several neutral changes in as far as government regulation of employment was concerned. What followed, 2005-work choices act has caused the industrial tribunal to become powerless by effectively relegating its mandate to that of a voluntary resolution provider[2]. It is worth noting that in industrial relations the tribunal plays a very significant role especially in resolving some of those problems facing employee – employer relations which if they end up in courts may take a long time to be resolved and therefore cause the economy a lot of manpower hours.
As a result of work choices act, the government regulation resulting there after has rendered the industrial tribunal inefficient and brought about a competition in the private dispute resolution provider[3]. It is clear that it is unwise for the state to regulate the employee relationship to the extend that the very regulations meant to streamline workers issues end up burdening the same workers.
In the case of Australia, state regulations have constrained the ability of the hitherto powerful employees unions and therefore affected industrial relation in Australia. It is also evident that if taken too far, state regulations can lead into powerful cooperation, which is so powerful that, workers negotiations become difficult. By introducing a national system of work place regulation the government has hindered the arbitrations process amongst employers and employees[4]. State regulations are not desirable in the sense that, they are a leading cause of dwarfing and limiting industrial action. Labour movement presents the employees with an opportunity to speak out their minds as well as to highlight issues they feel if not addressed they can most likely jeopardize there jobs.
In deed, if not applied carefully, state regulations lead to regulatory risks and this applies to the Australian case as well. Actually, state regulation has become threat to business an has been found to a bigger risk than rather risk businesses area assorted with such as country risk, as well as market risk[5]. In Australia state regulation such as the work choices was designed to bring less risk to businesses operating in Australia. However, it has turned out that the very regulations which were designed to bring about fewer risks and threats to workers have formed the basis of the worst crisis in labour history in this country.
Whereas the Prime Minister Mr. Howard argued that the regulations were going to form the basis of what would turn out to be a land mark business break through, the truth of the matter is that a state of confusion, anxiety as well as uncertainty has gripped the over ten million unionized labour force in this country.
The risk of doing business has dramatically short up in Australia as a result of state regulation this is a clear testimony that state regulation should be applied only to the degree that they do not impede the smooth running of business in Australia. It has come to the limelight that state regulations have the potential to drive the cost of doing business very high. This is what has happened in Australia following the work choices act of 2005.
In deed, state regulation is one factor which in the recent years has contributed to pushing away potential investors from investing in Australia[6]. If this is the kind of effects that regulation policies by the government is having on the economy then it is a clear indication that regulation intervention by the government is best if kept in the minimal. It is clear that regulation by the government is too costly for businesses but on the other hand businesses have no option other than to comply because non-compliance is met with stiff fines and penalties. For instance according to the work choices act of 2005 employees who fail to comply to the requirements of the regulation policy are required to pay fines amounting to thousands of Australians dollars.
This is a clear indication that the regulation policies in Australia are both burdensome and too tough for employees who fail to comply. What has therefore resulted is the fact that the regulation policy by the state have only served to stifle innovativeness. As a result industrial regulations, growth is likely to suffer as it may become difficult for technological industries in Australia to fail to compete effectively with other industries in developed industries where by there are no oppressive regulatory policies.
The state regulation policies in Australia occasioned by the work choices act of 2005 has seen unprecedented negative effects on the minimum wage as the new regulation have fallen short of elaborating and creating a fixable national minimum wage limit. As a result of state regulation, the age of work has been affected in that due to high pressure from the government for business to perform, most of these businesses have resorted into discriminating against some sections of employees especially the unskilled and semiskilled as well as the elderly workers. It is fair to note that the level of regulation of employment relationships by the state in Australia is far much less than the level of state regulation in other developed countries such as Germany, the united state of America, France and Britain,
However, worthy mentioning here is the fact that, if the work choices act reflects what the government is likely to do in the future, then there is a real risk that businesses and employee relations are going to be affected negatively by subsequent state regulations. The fact that state regulations in Australia have reduced the bargaining power of unions and workers means that the power of unions to defend clients has been greatly affected. It is evident that although the Australia fair pay and the conditions standards is mandated with the responsibility of ensuring fair pay, the issue of minimum wages is more likely to remaining a controversial issue in the near future.
The curtailing of union power is a clear indication that million of workers who depend on the union for better pay safe working environment as well as high living standards have been left vulnerable to exploitation by employers who have become more powerful in contract negotiation following the state regulation through the work choices act and other related government policies[7].
Given the fact that the Australia employment relations have been self regulated for quite sometime before the enactment of the work choices act, it has become very difficult for workers to come into terms with new measures which have seen majority of workers voiceless in issues touching directly on their employee rights.
Consequently, workers have been forced to work during public holidays as holidays are no longer automatic but defend employers’ choice. Denial of workers’ right to enjoy their holidays is raising serious human rights questions as such abuse of rights is in direct contravention to the requirements of international labour organization laws (ILO).
As a result of regulation measures by the state minister have become very powerful in controlling awards as well as in the process of negotiation deals. This is in bad taste and for a country like Australia, which has enjoyed a century of powerful workers unions’, which as seen people applaud the states non-interference policy in employment relationship. The regulation by the state is proving that Australia is drifting into a direction where by the employers and employees are no longer able to make binding agreements but must consult the government before making such agreements.
In conclusion, it is clear that, the state’s regulation of the employment relationship if not kept at a bear minimum can result to risks such as curtailing employment rights of workers, such as workers holidays, age of employment, minimum wages, insurance in that, insurance coverage for workers becomes tricky as the contracts signed between the workers and the employers become more uncertain. Therefore, it is evident that the best thing is that the government of Australia should consider amending the work choices act so as to ensure that the state regulation does not translate into interference in employment relationships.
