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Subject: IR Reform

PETER STEFANOVIC: Let's go to Canberra now, and joining us live is the Attorney-General, Christian Porter. Christian, good to see you, thanks for joining us this morning. So you are continuing to roll out your changes when it comes to IR. Now, the ACTU's not happy this morning - it says up to one in four Australian workers could cop a pay cut under this latest change. What do you say to that?

CHRISTIAN PORTER: That's - it is quite absurd. I mean, every one of the reforms that we're engaging is designed, given what we've been through with COVID, to remove barriers to job growth; to remove barriers which prevent people getting more hours in their employment if that's what they want and to ensure that there aren't these barriers that have existed that stop people from moving from casual, if they want to, into permanent employment. So, I mean, there's just nothing to back up that statement - it's a little bit on the out there side, unfortunately.

PETER STEFANOVIC: Right. Okay. But can you guarantee workers won't be worse off under agreements made under these changes.

CHRISTIAN PORTER: Well, obviously you're talking there about enterprise agreements. Generally speaking, enterprise agreements pay people 40 per cent more than on awards. The problem in the system, which everyone agrees on, has been that there've been too few enterprise agreements, so people don't get the benefit of that very significant uplift in wages.

All of these changes are designed to have more enterprise agreements, where more people get paid more than the award rates - and that's fixing a known problem in the system, a problem that everyone agrees exists. At the moment there are too many enterprise agreements that have been prevented or turned over because of minor technical or legal problems and we want to end that. We want to see more agreements paying more people more money, and that help businesses drive productivity so they can actually grow their way out of the COVID-19 recession.

PETER STEFANOVIC: So no one's going to get a pay cut.

CHRISTIAN PORTER: This isn't about pay cuts for people, this is about more jobs, more hours, more ability to move from casual to permanent employment. I mean, there's no evidence of that suggestion from Sally, and I respect Sally's view, but there's no evidence of that whatsoever.

And what these reforms do is respond, not merely to known problems in the system and fix them, but respond to the fact that we've gone through something extraordinary. And there are a whole lot of businesses that need help to stay afloat and grow jobs - and everyone is worse off if businesses fail and jobs don't exist. So they're the sort of problems that we're trying to fix.

PETER STEFANOVIC: Employers have got a two-year time limit to thrash out deals, but those agreements could last up to four years or perhaps even longer than that. So will workers on a lesser wicket be locked into these agreements long after the pandemic ends?

CHRISTIAN PORTER: Well, I think there you're talking to the fact that there's already an exemption provision in the Fair Work Act which allows, in some very limited, exceptional circumstances for the independent umpire to approve an agreement that may have not met a legal or technical standard because that's necessary for the business to survive during a crisis. We're obviously in a crisis and we're going through a crisis caused by COVID.

We're simply putting in a small change that says to the Fair Work Commission that you can consider whether or not the business needs this change, that it's agreed with its employees to survive through COVID. And that exemption will only last for two years and the agreements that may be concluded pursuant to that exemption themselves can only last for two years. We would expect that would be used very, very rarely as the existing exemption has been used very, very rarely.

But you know what? If a business and its employees all agree that they need to make a change to keep that business afloat, then why shouldn't the independent umpire be able to say, yeah, you should be able to make that change because that saves your business and it saves jobs - even if that change doesn't necessarily tick some legal or technical box?

PETER STEFANOVIC: There is that 21-day limit for the Commission now and so that’ll be harder for unions to intervene. Will there be much less scrutiny of these agreements now?

CHRISTIAN PORTER: Well, I think actually the ACTU, through Sally McManus today, have agreed that that 21-day time limit is a good idea. What has been happening is that these agreements go before the Fair Work Commission and, because of all the technical and legal requirements, one of them that we're going to remove is the requirement to consider hypothetical employee's situations. So these situations arise that stop the agreements being concluded because the Fair Work Commission is compelled to take into account hypothetical circumstances that don't exist and are never likely to exist. So we remove that. And those sort of...

PETER STEFANOVIC: But what's an example of that?

CHRISTIAN PORTER: Well, an example is - that was put to me, was that Officeworks - we'd all be familiar with them, good business employing a lot of Australians - they spent considerable time arguing about and discussing what they would do, and ultimately had to provide undertakings to the Fair Work Commission to describe what they would do if they had people in Officework serving alcohol and using cool rooms. Now, I know, I've been to Officeworks recently. There's no alcohol being served and there certainly aren't any cold rooms. And they've got no intention of having either of those two things and yet they end up having to have long legalistic conversations about what they might do if those things eventuated.

That is a massive waste of time, effort, money, it puts businesses that are already under stress, under further stress. And those are the sort of things that we just want to fix in a common-sense reasonable way. And look, there'll be things in these bills that unions will like; there'll be things that they won't like. There are things in these bills that business like; there are things in these bills that some businesses won't necessarily like. But we've tried to find a balance to fix problems, to grow jobs because we cannot leave the economy on autopilot. Some things need to be addressed, fixed and changed if we want to prosper and survive, and grow jobs on the other side of the COVID-19 recession.

PETER STEFANOVIC: When you're talking about those, you know, those hypothetical situations, that example that you just gave there; what's the point of better off overall if workers aren't better off overall?

CHRISTIAN PORTER: Yeah, but equally, how you measure better off overall - if you're measuring better off overall against a worker, a hypothetical worker in a hypothetical shift that has never existed and is never likely to exist, that doesn't look like a common-sense test, measuring whether or not people are better off overall. It looks like an overly legal technical response by lawyers to a problem. And, you know, I'm not saying anything to you that Paul Keating hasn't said. He was interviewed recently on ABC and he pointed out that people on enterprise agreements get paid more, more often than on the award. So it's better to have more enterprise agreements because people get paid more. But the problem has been, I think, in his words, that the system has become too technical and too legalistic, which was never how it was designed. So it's how you measure, of course, these things. And we want them measured in a common-sense, reasonable way.

PETER STEFANOVIC: You mentioned that you want to give the FWC limited circumstances for suspending the BOOT. Are they really limited or is it really quite wide?

CHRISTIAN PORTER: Well, I think they're very limited. So at the moment, the exemption is, for example, if it's necessary to deal with a short term crisis and to assist in the revival of an enterprise. Now, you know, we've gone through something that's not actually a short term crisis; in many industry sectors and for some businesses, in tourism, in retail, things that are dependent on international tourism, they are going to have a monstrous and difficult task ahead of them to try and survive and then prosper on the other side of COVID-19. All we are saying to the commission is, given that you already have a power to grant exemptions in some very limited circumstances, in considering those circumstances, please consider the circumstance of COVID-19, which is as exceptional as we've seen in 120 years. Now, that seems like a common-sense and reasonable approach, and I think most Australians will see it that way.

PETER STEFANOVIC: Are you and Sally not getting on at the moment?

CHRISTIAN PORTER: I think we're still getting along very well, but it's never the case that, and we're still talking very regularly, and these bills will be introduced to Parliament today and they'll go into a committee. And Sally and myself and the ACTU, as I will talk with business groups, we'll keep talking. We'll keep listening. No one's pretending that everything in here is absolutely loved by either business or unions. But it's meant to be a reasonable middle path to fix problems that we all agree exist. And those problems are acting as barriers to job growth. So, as I said, I think yesterday, not every tear is a waterfall and not every disagreement is the end of the world. This is about trying to engage in sensible discussion and dialogue around what are now clearly known parameters and bills that go into the parliament. You know, those discussions are going to keep going.

PETER STEFANOVIC: Just a quick one before we go. I think about 30 seconds. The TWU has lodged a federal court case against Qantas over its decision to outsource ground staff. Do you think they have a case?

CHRISTIAN PORTER: Well, they obviously (think they) do. Equally, Qantas think that that was something that they had to do to keep their business functioning and obviously the airline industry has been under more pressure than it has ever been in Australia since we first had Qantas flying between Queensland and the Northern Territory. It's not for me to defend that decision or to overly critique it. The reality is that some businesses are going to have to make some very, very tough decisions. We've invested $2.7 billion to try and keep the airline industry afloat, connected to its customers and its staff. They're intensely difficult decisions. But I think we should leave the running of airlines to the people who are best at it and that's not me. It's not people in Parliament. That's people in business who are making really tough decisions. And we're all hoping that they're making those decisions in the best interests of their business, and the best interests of their employees and to stay afloat and survive.

PETER STEFANOVIC: Okay. Attorney-General Christian Porter, appreciate your time this morning. Thanks for joining us here.

CHRISTIAN PORTER: Thanks. Been a pleasure.