Effect given to the recommendations of the committee and the Governing Body - Report No 342, June 2006

Case No 2326 (Australia) - Complaint date: 10-MAR-04 - Closed

Effect given to the recommendations of the Committee and the Governing Body

1. 21. The Committee last examined this case at its November 2005 meeting [see 338th Report, paras. 409-457] and on this occasion made the following recommendations:
   • (a) The Committee requests the Government to provide specific information as to the forums for consultations and proposals tabled by the social partners with regard to the 2003 and 2005 Bills.
   • (b) The Committee requests the Government to take the necessary steps with a view to modifying sections 36, 37 and 38 of the Building and Construction Industry Improvement Act, 2005 (the 2005 Act), so as to ensure that any reference to “unlawful industrial action” in the building and construction industry is in conformity with freedom of association principles. It further requests the Government to take measures to adjust sections 39, 40 and 48-50 of the 2005 Act, so as to eliminate any excessive impediments, penalties and sanctions against industrial action in the building and construction industry. The Committee requests to be kept informed of measures taken or contemplated in this respect.
   • (c) The Committee requests the Government to take the necessary steps with a view to revising section 64 of the 2005 Act so as to ensure that the determination of the bargaining level is left to the discretion of the parties and is not imposed by law, by decision of the administrative authority or the case law of the administrative labour authority. The Committee requests to be kept informed in this respect.
   • (d) The Committee requests the Government to take the necessary steps with a view to promoting collective bargaining as provided in Convention No. 98, ratified by Australia. In particular, the Committee requests the Government to review, with the intention to amend, where necessary, the provisions of the Building Code and the Guidelines so as to ensure that they are in conformity with freedom of association principles. It further requests the Government to ensure that there are no financial penalties, or incentives linked to provisions that contain undue restrictions of freedom of association and collective bargaining. The Committee requests to be kept informed in this respect.
   • (e) The Committee requests the Government to introduce sufficient safeguards into the 2005 Act so as to ensure that the functioning of the Australian Building and Construction (ABC) Commissioner and inspectors does not lead to interference in the internal affairs of trade unions and, in particular, requests the Government to introduce provisions on the possibility of lodging an appeal before the courts against the ABC Commissioner’s notices prior to the handing over of documents. As for the penalty of six months’ imprisonment for failure to comply with a notice by the ABCC to produce documents or give information, the Committee recalls that penalties should be proportional to the gravity of the offence and requests the Government to consider amending this provision. The Committee requests to be kept informed on all of the above.
   • (f) In light of the above, the Committee, recalling once again the importance that should be attached to full and frank consultations taking place on any questions or proposed legislation affecting trade union rights, requests the Government to initiate further consultations with the representative employers’ and workers’ organizations in the building and construction industry so as to explore the views of the social partners in considering proposed amendments to the legislation having due regard to Conventions Nos. 87 and 98, ratified by Australia, and with the principles of freedom of association set out in the conclusions above. The Committee requests to be kept informed of developments in this respect.
2. 22. In its communication dated 10 February 2006, the Government provided information on the above recommendations.
   • - In respect of recommendation (a), the Government states that it has undertaken extensive consultation with industry participants and interested parties regarding the Building and Construction Industry Improvement Bill 2003 (BCII Bill 2003) and the Building and Construction Industry Improvement Bill 2005 (BCII Bill 2005). Both Bills represented the Australian Government’s considered response to recommendations of the Royal Commission into the building and construction industry following extensive public consultation and scrutiny by the Australian Parliament. The Australian Government believes the Australian Council of Trade Unions (ACTU) and unions in general were given ample opportunity to provide submissions on reform and legislation. These opportunities were available during extensive consultation periods for both the BCII Bill 2003 and the BCII Bill 2005. The fact that the unions decided not to avail themselves fully of these numerous opportunities is not a reflection on the level of consultation undertaken.
   • - With regard to recommendation (b), the Australian Government does not consider that the BCII Act 2005 requires amendment for the purposes proposed therein. The Government submits that sections 36, 37 and 38 of the BCII Act 2005, which specifically deal with industrial action, reflect Australia’s ILO obligations, including freedom of association principles. Concerning penalties, the Government indicates that, for most industries, the penalties contained in the Workplace Relations Act 1996 are sufficient to deter unlawful conduct. However, the Royal Commission found that an entrenched culture of lawlessness exists in the building and construction industry, and a belief among industry participants that breaking the law does not have any real consequences. The measures contained in sections 39, 40 and 48-50 of the BCII Act 2005 are a direct response to these findings.
   • - In respect of recommendation (c), the Government submits that section 64 of the BCII Act 2005 helps to ensure that determination of the bargaining level is left to the discretion of the parties at the enterprise level. Large building and construction projects involve work by an array of employers and employees. Project agreements, which are commonly used on building sites, can be intended to deny employers and their employees the right to develop terms and conditions that suit their circumstances by trying to secure “pattern” outcomes. Furthermore, the nature of the work and the conditions applying to various employers in the industry may differ markedly. The Government considers that it is inefficient and costly to mandate a single set of terms and conditions in these circumstances. For the most part, project agreements impose inflated wages and conditions, inconsistent with existing workplace negotiated agreements and without a commensurate increase in productivity.
   • - As concerns recommendation (d), the Government indicates that the National Code of Practice for the Construction Industry (the National Code) and associated Implementation Guidelines (the Guidelines) are not designed to promote any type of industrial instrument above another. The Guidelines are drafted for the purpose of assisting employers and employees to practically implement the recommendations of the Royal Commission, as well as at progressing the Government’s commitment to establishing higher standards of workplace relations behaviour, flexibility and productivity within the building and construction industry. For the Government, the Committee’s comments on the status of collective bargaining are based on the proposition that Article 4 of Convention No. 98 imposes an unqualified obligation on ratifying States to promote collective bargaining at the expense of all other forms of bargaining. The Australian Government does not agree with that view: Article 4 requires measures for the encouragement and promotion of collective bargaining to be taken “where necessary”, and that such measures are to be “appropriate to national conditions”.
   • - With regard to recommendation (e), the Government considers the existing safeguards in the BCII Act 2005 to be comprehensive and appropriate and, as such, does not judge further protections to be necessary. Given the extent of unlawful and inappropriate behaviour in the industry, the powers of the ABC Commissioner to require a person to provide information are both appropriate and necessary. The Government emphasizes that there currently exist important protections and safeguards in the BCII Act 2005. The Act establishes criteria that the ABCC must satisfy in order to exercise its powers to obtain information and restricts what a person may do with protected information that has been obtained during the course of official employment. In this connection, unauthorized recording or disclosure of protected information is an offence carrying a maximum of 12 months’ imprisonment. The protected information provisions apply to all members of staff of the ABCC. The Government therefore considers that penalties of this nature have the effect of providing protection to individuals who seek to provide information to the ABCC. It also points out that the powers granted to inspectors are similar to the powers of inspectors in many countries. Concerning the right of appeal to the courts before handing over documents, the Government states that such right currently exists and has been exercised on several occasions. In all of the cases cited by the Government, the person served with a notice or requirement to produce documents was afforded the opportunity to test the validity and ambit of the notice in the Federal Court. The Government emphasizes that the relevant operative provisions of the BCII Act 2005 contain a minimum 14-day time period to comply with the notices. This affords persons the opportunity to obtain legal advice with respect to their legal options and to test the matter in the courts if they so choose. With respect to the penalty of six months’ jail for failure to comply with a notice issued by the ABC Commissioner to provide information or documents, the Government states that the courts retain the discretion to impose a penalty proportional to the gravity of the offence and can apply a sentence of less than six months’ imprisonment or impose a financial penalty instead of a jail term.
   • - In respect of recommendation (f), the Government considers that appropriate regard was given to Australia’s obligations under ILO Conventions Nos. 87 and 98 in developing the building and construction industry improvement legislation. It further informs that the ABC Commissioner intends to meet on a regular basis with the industry’s participants. The industry’s key employer and employee associations will be invited to these meetings. The meetings will be an opportunity to canvass any issues of concern about the administration of the BCII Act 2005 by the ABC Commissioner. In addition, the Government informs that it convenes a National Workplace Relations Consultative Council at least twice a year. The Council is chaired by the Minister for Employment and Workplace Relations and is attended by national union and employer representatives. Employers and unions are entitled to raise concerns about workplace relations legislation in this forum. Finally, the Government reiterates that the BCII Act 2005 does not restrict freedom of association or the right of employees to organize, but rather seeks to address those activities identified in the Royal Commission that impinge upon these basic rights. As such, the Government considers that the BCII Act 2005 reflects Australia’s international obligations with respect to freedom of association principles and therefore does not propose to amend the legislation for the purposes proposed in the recommendations.
3. 23. The Committee notes the detailed information provided by the Government. It notes however that important discrepancies remain, particularly in respect of recommendations (b), (c) and (d), and regrets that the Government has not taken steps specifically aimed at addressing these points through further consultations with the representative employers’ and workers’ organizations in the building and construction industry.
4. 24. While taking due note of the further information provided by the Government, the Committee observes that this information largely reiterates the reasoning previously put forward by the Government in respect of restrictions upon industrial action, determination of bargaining levels and the promotion of collective bargaining more generally. The Committee therefore once again requests the Government to initiate further consultations with the representative employers’ and workers’ organizations concerned in the building and construction industry in order to explore their views on all of the matters raised in the Committee’s previous recommendations so as to ensure that the Building and Construction Industry Improvement Act, 2005, is in full conformity with Conventions Nos. 87 and 98. The Committee refers the legislative aspects of this case to the Committee of Experts on the Application of Conventions and Recommendations.