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December
2004
Are
AWAs better?
Do
Australian Workplace Agreements really give workers a better
deal? Not compared to union negotiated collective agreements,
as Debbie Richards explains.
Over
the forthcoming months, we are likely to hear a great deal about
the benefits of Australian Workplace Agreements (AWAs) and how
they are the answer to fairness and flexibility in the workplace.
However, as one of the central planks of the Howard Government's
industrial relations agenda, the renewed push for AWAs should
be seen for what it really is: a way to reduce the wages and
conditions and remove the rights and entitlements of employees
in the workplace.
Since AWAs are not public documents and not available for public
scrutiny, information on the terms and conditions they contain
is limited. However, research referred to here may be helpful
in sorting out the facts from the fiction.
AWAs were introduced by the Howard Government in 1996 as part
of a raft of changes to industrial relations legislation reflecting
a view that industrial arrangements should be the exclusive business
of the employer and the
individual employee.
After an AWA is signed by the employee and employer, the process
is overseen by the Office of the Employment Advocate.
The Employment Advocate will approve an AWA if it passes a 'no
disadvantage' test. However, the no disadvantage test is measured
against the relevant award, and not the current industrial instrument
applicable, such as an enterprise bargaining agreement. Since
the introduction of the Workplace Relations Act in 1996, federal
awards have been reduced to a basic set of wages and conditions
known as a 'safety net'.
An AWA can therefore contain significantly less wages and conditions
than the prevailing collective agreement, but still pass the
'no disadvantage' test.
Nursing is a good example of this. The wages and conditions for
the vast majority of nurses are determined by collective bargaining
agreements reached between the ANF and employers, operating in
conjunction with the relevant award.
Just looking at wages alone, an AWA can technically contain wage
rates which are between 17 to 40% less than those in ANF collective
agreements, depending on the particular classification.
In South Australia for example, the weekly rate in the Public
Sector Award for an RN Level 1 at the top increment is $757.60,
compared to $991.00 for an RN Level 1 at the top increment in
the South Australian Public Sector Enterprise Bargaining Agreement
- a difference of 30.8%.
Once an AWA is in operation, it totally displaces any existing
award or collective bargaining agreement.
Information from the Office of the Employment Advocate asserts
that employees covered by AWAs earn the highest average weekly
earnings.
What it doesn't say, is that when the rates of pay of managerial
employees are removed from the data on average earnings, non-managerial
employees under collective bargaining agreements receive the
highest hourly rate.1
Various studies have also shown that the wage increases provided
in AWAs lag behind union collective agreements.2
For
example:
- One
study found some 27% of the AWAs under examination contained
no provision for a wage increase during the life of the agreement.
This trend was confirmed by another study of 300 AWAs showing
that most AWAs fix the pay rate for the duration of the agreement.
- Those
AWAs that did contain wage increases tended to link that increase
to some measure of individual performance implemented at the
discretion of the employer.
- A
high proportion of AWAs included annualised salaries or all-in
rates of pay absorbing penalties and allowances including annual
leave loading.
- AWAs
were largely concerned with increasing flexibility of labour,
particularly through changes to hours of work and penalty rates,
to allow employees to work at any time and any day of the week.
- A
substantial number of AWAs were single issue agreements, usually
aimed at the liberalisation of ordinary hours of work and/or
pay.
- Most
of the benefits achieved through the introduction of AWAs (in
the hospitality industry) were one-sided, with employers achieving
wages and hours flexibility at the expense of employee entitlements.
- Case
studies (in hospitality) show that the focus was on using AWAs
to implement flexibilities perceived by the employer as not achievable
under awards or collective bargaining. AWAs were used as a tool
to reduce labour costs, and organisational efficiencies were
often gained at the expense of the individual employee.
So far the existence of AWAs is not a common feature in the health
industry. In fact, since their introduction in 1996, there has
only been a limited uptake, with 'live' AWAs covering only a
very small percentage (1.9%) of the workforce.3
The ANF will continue to pursue the advancement of nurses' wages
and conditions through enterprise bargaining agreements reached
between the ANF (Federal Office or state or territory branches)
and employers alongside the maintenance of an award system. This
is the only way nurses can achieve fair and just outcomes.
References
1 van Barneveld, K. Wage outcomes under AWAs compared
to collective agreements, Abstracts from a doctoral thesis
submitted to Newcastle Business School, University of Newcastle,
p.1
2 ibid. pp.1-8
3 Mitchell, R. and Fetter, J. Human Resource Management and
Individualisation in Australian Labour Law, The Journal of
Industrial Relations, 45:3, September 2003, p.304.
Debbie Richards
Federal Industrial Research Officer
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