Relics of a Byzantine IR system: why awards should be abolished

Industries Australia

Howard’s Work Choices reforms were seen by many as the enemy of the Aussie ‘fair go.’ Since then, the spectre of Work Choices has loomed large over the debate on labour market reform and created a toxic debate over the benefits and prospects of further reform.

But if Australia’s economy is to continue to be competitive, and offer rising incomes and job opportunities to all Australians, further labour market reform is essential. But is it possible to reform our industrial relations system and keep the ‘fair go’ alive?

This report argues that the award system, which has been the bedrock of our industrial relations system since federation, is one of the major obstacles in the way of a more flexible and productive labour market.

Critics might argue that the award system is a vital part of our safety net. That may have been true in the past, but Australia now has a federal minimum wage and a comprehensive set of statutory conditions that apply to all workers. This safety net is one of the most generous in the Western world, and more than adequately provides for the needs of the low paid.

An efficient and fair labour market regime should provide minimum standards and leave the rest to employers and employees/unions to negotiate. Australia’s award system is outdated and redundant. It ought to be abolished in favour of existing statutory minimums so more jobs can be created.

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