Australia needs further reforms of its industrial relations system

Comments on Corin McCarthy “On the wrong track when politics drives wages policy”, 7/09/2009, http://www.theaustralian.news.com.au/story/0,25197,26035134-5013480,00.html

While it is true that a flexible workplace and industrial relations system will benefit the economy, productivity and employment of low paid workers, to let the market completely dictate the conditions and pays of workers like treating low skilled workers as slaves is also unacceptably inhuman. There should a balance between different objectives. Business profits and human dignity are both important.

Tax credits for low income people can be part of the solution. But that should be done for lowly paid workers as opposed to others who may have worked fewer hours with high paid jobs. This is an important principle that should be incorporated into the design of tax and welfare system through the Henry tax review.

Another point is that instead of setting a compulsory bottom for the minimum pay for the lowest paid workers, the relevant agency or commission may recommend a set of indicative decent minimum wages that serve as a reference for business and workers whey they negotiate on wages and conditions.

A third point is that there should be room for individual workplace contracts alongside other forms of employment contracts. To have some safeguard for both employees as well as businesses, such contracts should be lodged with a government agency for filing and potential disputing resolutions.

Australia’s industrial relations system needs another significant change after the next federal election, notwithstanding the current rewriting of it by the Labour government following its mandate in the last election.

While Gillard is constrained by election promises, the huge amount of work in a short time and inexperience so far, the next term Labour government should provide a good platform to do more and do it in a more sensible way.