Unfortunately, and somewhat unusually, for John Howard, the industrial
relations proposals lacked the thoroughness and preparedness that had gone
into reforms such as the Goods and Services Tax and welfare. The need for
industrial relations reform was taken as an act of faith with little reasoned
analysis of the benefits to the economy, such as more jobs, higher productiv-
ity, or lower unemployment. Perhaps most telling was the obvious discomfort
displayed by the prime minister when quizzed in the media about whether
anyone would be worse off under his proposals. Regulation of markets always
benefits some parties, to the detriment of others. The onus is on those sup-
porting deregulation to demonstrate the benefits of deregulation to the econ-
omy as a whole.
The lack of reasoned argument and detail made Howard a perfect target for
Labor, the ACTU, and much of the media. Perhaps not surprisingly, Work-
Choices was vigorously attacked by the unions. They and Labor had obviously
struck a chord with the general public, if we are to believe opinion polls, and
the ACTU put massive resources into a campaign against WorkChoices. Work-
place industrial relations was shaping up as the defining issue in the upcoming
federal election in 2007.
In the face of almost daily adverse reports of unpopular impacts of Work-
Choices, the government announced a new‘fairness test’to apply to all
new AWAs after 7 May 2007 under the Workplace Relations Amendment
(A Stronger Safety Net) Act 2007. The fairness test required the newly
strengthened Workplace Authority, previously the Employment Advocate,
to vet all agreements and to be satisfied that employees get fair compensa-
tion for modifying or removing protected award conditions such as leave
loadings, penalty rates, overtime payments, and breaks. The fact that every
agreement had to be vetted, rather than giving employees the right to
choose to have an agreement vetted, may seem to have been somewhat of
an overreaction to the criticism of WorkChoices. The‘fairness test’applied
only to employees earning less than $75,000 per year and related only to the
conditions that would be covered by the award (if any) relevant to that job.
As the federal election was taking place, there was a huge backlog of AWAs
which had been rejected outright or had been sent back to employers for
amendment. Given the complexity and cost to employers of AWAs, employ-
ers virtually gave up using them.
7.5 The Rudd Reset
In its approach to regulation it was important for Labor and the new Labor
leader, Kevin Rudd, to come up with an alternative which would wind back
WorkChoices, without giving the impression that the Labor Party was simply
Australia’s Industrial Relations Singularity