A retrospective of what’s changed in employment over the past decade identifies some obvious recurring themes. Union membership is falling. Industrial action is relatively rare, and strike action is rarer.
And that’s only the beginning. Here are six employment trends and tips about what you can expect as we move further into 2017.
1. Enterprise bargaining and IR
More employers will be seeking to unwind unsustainable employment terms and conditions, while seeking to increase productivity and reduce labour costs. This trend really only started during the GFC. Employers will look to exploit outsourcing and make applications to terminate enterprise agreements. (The latter option, although still difficult to achieve, is much more viable since the FWC Aurizon decision in 2015.)
The manufacturing, electricity and utilities and construction sectors are likely to lead initiatives here, especially since they have traditionally been vulnerable to union demands. If employers do seek to establish a new equilibrium, it wouldn’t surprise to see an increase in industrial action and lost production.
2. High profile fallout from bullying and harassment claims
Many careers have been ruined as senior executives have been confronted by serious allegations of sexual misconduct or bullying. The 2016 allegations against the CEO of Seven West Media, Tim Worner, saw that company’s share price immediately plunge by 8 per cent, and the fallout is continuing . The vast majority of complaints of workplace bullying and sexual harassment are addressed privately and are not subject to external scrutiny. Australia’s anti-bullying laws in the Fair Work Act only commenced in 2014. Most reputable employers already had anti-bullying policies and most of those have been strengthened in the last year or so.
3. More whistleblower complaints and investigations
The protections provided by the anti-bullying laws and the adverse action and victimisation provisions of the Fair Work Act are empowering employees to stand up for their individual rights at work. In 2017, the federal parliament is likely to enact new laws covering whistleblower protections against unions, to supplement existing whistleblower provision under the Corporations Act. The powers of the Fair Work Ombudsman will be expanded. Protections covering an array of other activities could also be considered. Employers wanting to get ahead of the game, will already have established or be considering their own internal systems.
4. FWO and ABCC – more active regulators
The Fair Work Ombudsman (FWO) and the recently re-energised Australian Building and Construction Commission (ABCC) will not only be focussing on corporate scalps, but also individuals with management responsibility. The FWO has built up tremendous capability over the past few years and despite its stretched resources will prosecute breaches by employers and unions alike. Franchise operators will be in the spotlight following the underpayment disclosures affecting 7-Eleven convenience stores over the past year. The accessorial liability provisions in section 550 of the Fair Work Act will remain in the spotlight. The FWO uses these provisions in over 90% of its prosecutions for contraventions of the Act against Directors, HR Managers, lawyers, line managers and others.
5. Workplace crisis management
Increasingly, businesses are being called upon to respond to workplace crises with media, social media and broader reputational issues. Businesses which manage these situations well have carefully considered the risks of these events occurring and have in place a clear plan to manage them. These crises may involve workplace incidents, union blockages, social media campaigns, regulatory investigations or salacious claims played out in the media.
(Read our guide on how to handle a scandal).
6. The union movement continues to recalibrate
Trade unions will continue to redefine themselves this year in order to remain relevant and arrest plummeting membership numbers, currently at an all-time low of about 15 per cent overall and only 11 per cent in the private sector. The merger between the MUA and the CFMEU into a ‘super union’ continues to gather momentum. The retail and fast food sectors have seen the entrant of a new player – the Retail and Fast Food Workers’ Union – which is self-described as being unapologetically militant. They will struggle, like all unions, in organising an increasingly casualised workforce of millennials. What will this all mean for employers? After years of relative restraint, it would not be surprising to see increased levels of disputation, as unions seek to build up their relevance to their traditional membership base.
Also expect an increased scrutiny by unions on labour hire and outsourcing arrangements. With a high level of media focus on the 2016 disputes between unions and Esso and CUB, the use of global social media campaigning as an additional union tactic will increase.
Anthony Wood is a partner at Herbert Smith Freehills.