The government has capitulated to crossbench pressure to drop its plan to enable the suspension of the Better Off Overall Test for COVID-affected businesses.
Industrial Relations Minister Christian Porter announced the backdown because it has been clear for some time the legislation would not get the needed crossbench support in the Senate with the weakened BOOT.
Pauline Hanson said on Monday the change to the BOOT needed to be scrapped for negotiations with One Nation (which has two Senate votes) to continue on the bill generally.
The government needs three out of the five Senate non-Green crossbenchers to pass the legislation.
The plan was that the BOOT could be bypassed for agreements concluded during the next two years where the business was affected by COVID. The government claimed this would not apply widely, a claim strongly contested by Labor and the unions.
The retreat on the BOOT is likely to ensure the bill passes the second reading in the Senate, despite Labor declaring it will oppose its second reading.
That would complicate the issue for Labor which, if the second reading is passed, will have to engage with the detail of the bill, such as the crackdown on wage theft and the proposed pathway for casuals to convert to permanent positions. But Labor maintains its opposition to the whole bill.
In his statement, Porter acknowledged the government was acting “as a result of ongoing consultation with members of the Senate crossbench”.
The legislation will be debated in the House of Representatives this week, where the government will amend the bill.
Porter continued to defend the now-dropped BOOT change as modest, and said it was only an extension of a provision Labor had inserted in the Fair Work legislation.
“While we continue to believe this was a sensible and proportionate proposal in light of the current challenges our economy is facing, we also understand that this measure had the potential to distract from other elements of the package which will help employers and employees recover from the economic impacts of the pandemic,” Porter said.
Porter told parliament the government was taking a “practical, pragmatic approach” in amending the bill.
The opposition spokesman on industrial relations, Tony Burke, said Scott Morrison and Porter had made it clear “they are only ditching their plan to scrap the Better Off Overall Test because they cannot get it through the Parliament – not because they recognise it’s unfair”.
“They are retreating this time for the sake of political expediency.
"But clearly this is what they want to do. They want to cut workers’ take home pay - and if they get another chance they’ll try again,” Burke said.
“When the government first announced it was planning industrial relations changes Labor set a very simple test: we would support the legislation if it delivered secure jobs with decent pay. The government’s legislation still fails that test.
"Labor has always made it clear that while the BOOT change was the most egregious attack on job security and workers’ pay in the government’s bill – it is certainly not the only one.”
ACTU secretary Sally McManus tweeted: “The Government will try & pull the wool over the media & cross-bench Senator’s eyes by removing one small aspect of their IR Omnibus changes & spin it that they have "fixed” it. Removing the BOOT for two years is only one problem - there are PERMANENT changes that hurt workers.“
Authors: Michelle Grattan, Professorial Fellow, University of Canberra