Australian Industry Group PIR Conference - Canberra
I acknowledge the Ngunnawal people as the Traditional Custodians of the lands in the ACT. And pay my respects to their Elders, past and present. I also want to acknowledge CEO Innes Willox, along with Brent and the entire team.
Australian Industry Group plays such an important role in advocating for your members and contributing to public policy debates in this country – especially in my portfolio. Now of course, it’s no secret that you haven’t always welcomed all of our Government’s workplace relations reforms. But the engagement is always respectful and constructive.
Because we do have a shared commitment to strengthening the effectiveness and integrity of our workplace relations system. And that is particularly important in the construction sector, where integrity, compliance and accountability are essential to ensuring a level playing field. I don’t need to tell this room how important it is for Australia to have a lawful, safe and productive construction sector, that can deliver the housing and infrastructure that our country needs.
And you will all be aware of the longstanding structural and cultural issues within the industry. Unlawful conduct, corruption and inappropriate influence can create cost pressures and delays, can distort commercial decision-making, and undermine confidence across the supply chain. Our Government has taken strong, concrete action to begin cleaning up the industry, including placing every branch of the construction division of the CFMEU into administration.
And I would like to recognise the significant work of the administration towards cleaning up the union in just two years, after these issues were allowed to grow, unchecked, for a decade. Over 180 staff have been removed from the union, along with the entire elected leadership of the Victorian, Queensland and NSW branches, as well as the establishment of an Integrity Unit, a suite of new governance policies, and multiple independent investigations.
It is clear there remains work to do, and we are committed to the administration remaining in place until that work is done. But it is also clear that the problems in the industry go far beyond just the CFMEU. Allegations of serious misconduct, intimidation and violence, including the involvement of bikies, have also been made about employers, contractors and other industry participants.
Our Government’s position is very clear: there is no place for criminality, corruption, or violence in part of the construction industry, by Of course, addressing these issues is a shared responsibility. And that is why our Government is working closely with states and territories, industry, regulators and police to drive meaningful action. The National Construction Industry Forum has unanimously endorsed a Blueprint for the Future, setting out a pathway to boost productivity, promote lawful behaviour and support cultural reform across the sector.
As part of the Blueprint’s implementation, our Government is considering how potential Commonwealth standards for the construction industry could help improve both behaviour and productivity. We are consulting widely with industry on how such standards could help lift performance and address persistent challenges in the sector. Our Government released a discussion paper on 21 August to seek feedback on how targeted Commonwealth standards could be designed to be effective, proportionate and workable.
We want to ensure any new standards address genuine gaps, while avoiding unnecessary duplication or administrative burden. Contrary to misleading reports, these standards will require employers to enter an enterprise agreement covered by a union, as a condition of receiving Commonwealth government funding. Nor will the Government preference union-covered enterprise agreements when considering tenders for federally funded building and construction work.
Our Government has absolutely no intention of replicating Queensland’s former Best Practice Industry Conditions Scheme. The discussion paper covers a range of themes raised by industry stakeholders. For example, we are seeking views on how to stamp out the use of inappropriate ‘industrial fixers’ that are operating outside the Fair Work Act.
By circumventing lawful dispute resolution processes, these bad actors undermine and weaken the system for legitimate participants. Workplace relations matters be managed through lawful and transparent processes, not through informal or non-compliant arrangements outside the law. Importantly, we are also looking at how to set ‘fit and proper’ requirements for parties on construction projects, including for head contractors, subcontractors, and officials of registered organisations.
Effective reporting and whistleblower arrangements are also a key issue we are examining as part of this consultation. Because ensuring workers, businesses and other participants can raise concerns without fear of reprisal is critical to improve detection of misconduct and support effective responses. These are important and complex issues.
And as highly valued stakeholders in this space, I would strongly encourage the participation of Australian Industry Group and its members to participate in the consultation processes my Department has underway. Of course, changing deeply rooted cultural problems in the sector takes time. Success will require a collective effort.
And I want to reassure you that our Government is committed to working with you on the hard, serious work of long-term industry reform. Looking beyond the construction sector, Labor made an election commitment in 2022 under the Buy Australia Plan to develop a Secure Australian Jobs Framework. This principles-based framework will set out the Government’s expectations regarding secure work, fair treatment of workers and good workplace practices in Commonwealth contracts.
At the end of last year, our Government put out a discussion paper to seek feedback on the application, implementation and compliance arrangements of a proposed Secure Australian Jobs Framework. Value for money will remain central to government spending decisions, and the Secure Australian Jobs Framework will not require employers to be covered by an enterprise agreement as a condition of receiving government funding.
We will begin further consultation on this proposal in the near future, and we welcome your participation in the consultation process once it commences. As I have said, our Government is focused on delivering a workplace relations system that promotes integrity, cooperation and productivity across Australian workplaces. Of course, an essential part of that system is having a timely and effective dispute resolution process, through the Fair Work Commission as the independent workplace umpire.
And to help ensure the Fair Work Commission can continue to fulfil these vital functions, our Government has provided significant additional funding to the Commission since we were elected. In addition, we have legislated to address some of the emerging trends the Commission is facing, particularly the rise in AI-generated applications. Our legislation has given additional powers to the Commission to deal with vexatious or frivolous applicants, including preventing them from making further applications.
We have removed the burden of holding a hearing to determine whether or not an applicant in a general protections matter has actually been dismissed. And the Commission now has more discretion to be able to determine matters on the papers, without the need for a formal hearing. These changes will deliver faster resolutions to disputes, saving the time and resources of all parties.
But of course, as you will all know, the Commission does not have judicial powers, which means that some workplace matters must go to court. And stakeholders have told us that the existing framework is difficult to navigate. Resolution of workplace disputes can be spread across multiple institutions and pathways, adding cost and delays to accessing justice.
Parties might spend years trying to navigate lengthy legal proceedings in the Federal Court system, which deals with a vast variety of matters, not just employment law. Meanwhile, the feedback I am hearing from stakeholders about state-based specialist employment courts is that they can be quicker and easier to navigate. But these state-based courts are not available in every jurisdiction, and their set-up differs from state to state.
This can create barriers to the quick and efficient resolution of disputes – for both workers and businesses. Our Government wants to see faster and more effective outcomes for workers and employers across the whole country. That’s why our Government recently announced that we will establish a Fair Work Court, to provide a specialist judicial forum and a clear pathway for resolving workplace disputes.
The judges on the Fair Work Court will be experts in workplace relations matters, bringing deep specialist knowledge of the Fair Work framework and how it applies to Australian workplaces. Appointments to this Court will be made in the same merit-based way that judges and judicial officers are appointed to other courts. And I would like to stress this point: the creation of a Fair Work Court is not about adding additional obligations for employers.
It is about improving accessibility, and the way existing laws are administered and enforced. The Fair Work Commission will retain its central role in conciliation and arbitration, as Australia’s independent workplace tribunal. Our Government is consulting with key stakeholders like Australian Industry Group on the design and scope of the Court.
Of course, another critical element of having an effective workplace relations system is having certainty about the specific roles and responsibilities of all parties operating within the system. Unions are an important, legitimate part of that system. But unregistered organisations risk undermining the integrity and effectiveness of our whole workplace relations system.
Because they are not subject to the same high standards of democratic control, accountability and oversight as registered unions. That’s why I will be looking at ways to ensure the integrity of the workplace relations system is not undermined by these unregistered unions. This will give business certainty and reassurance that they are engaging with organisations that operate within a clear framework of accountability, transparency and oversight.
And that workplace matters are managed through legitimate and accountable channels. As I have said, I am committed to working closely with business and industry wherever I can. Because you bring a wealth of knowledge and expertise to some of the major policy challenges that our country faces – like the adoption of AI in workplaces.
And I have really valued working with Innes on the tripartite AI Employment and Workplaces Forum. I have convened this Forum to bring together government, unions and employers to work out how AI can be adopted in workplaces in a way that shares the benefits between employers and workers. Together, Forum members have agreed to develop best practice guidance, to build a shared understanding of what successful adoption of AI in the workplace looks like, and help build trust throughout that adoption process.
Because we know that Australians have low levels of trust in AI, which could negatively impact the successful adoption of AI in the workplace and undermine its potential productivity benefits. In my view, trust in the adoption of AI in the workplace depends on both organisational and individual capability. Not just the capability of workers and employers to use AI, but the capability at all levels of an organisation to adopt AI in a way that maintains trust.
And capability will be the focus of our discussions at the next meeting of the Forum. Having Australian Industry Group at the table for these discussions is invaluable. Because you are uniquely placed to represent your members and their experiences through the adoption of AI, including what is working well and what barriers are emerging.
And I am keen to ensure we are hearing these stories of what’s happening on the ground in this fast-moving policy space, to inform our discussions. Just as our Government is working together with industry to maximise the benefits of AI adoption in the workplace, we are also working together to tackle another challenge: gender equality in the workforce. Unfortunately, Australia has some of the highest rates of industry gender segregation amongst advanced economies.
And that has negative impacts across our economy. Occupational shortages get worse as gender segregation intensifies. And businesses miss out on the diversity of thinking that drives growth.
That’s why our Government’s grant program to advance gender equality in gender-segregated industries has delivered funding to both employer-led and worker-led projects, to tackle the systemic barriers that women in those industries face. Australian Industry Group received $6 million over three years to support women in the construction and manufacturing sectors, by working with companies in those industries to develop practical solutions to these barriers.
And it’s been great to hear some of the success stories from the pilot program. Like a construction business in Western Australia that Australian Industry Group worked with to develop more inclusive apprenticeship pathways for women in operational roles, and improving flexibility in job roles to boost retention for female workers. And a family-owned manufacturing business that got help to develop a tailored leadership development program that supports the progression of female employees into leadership roles, by recognising and responding to the specific barriers that women face in their career development.
I look forward to hearing more of these great outcomes, through the extension of this grant funding that I announced last year. Across all these issues – whether it’s reforming the construction sector, improving dispute resolution, or advancing gender equality – what’s really critical is that Australia has a workplace relations system that is fair, productive and fit for the future.
As a Government, we are committed to strengthening the institutions and frameworks of our workplace relations system to promote cooperative and productive workplaces. But we also know that these are complex issues, and that lasting change is rarely achieved by Government acting alone. And our Government will continue to engage closely with employers, industry, workers and their unions as we continue this important work.