A strange case of (IR) laws about nothing?

This is Part Two of my assessment of the Albanese government’s new world of industrial relations. This assessment covers the strange ‘employee-like’ laws.

Recently I gave you my assessment of one large chunk of the Albanese government’s new industrial relations laws. Titled ‘Enter the new deal-making’, I detailed how the new laws give unions major leverage over businesses. I said that managing a business in Australia, large or small, now involves a situation where unions have a legal right to interfere in just about any aspect of managers’ and owners’ decision-making. 

In this assessment/commentary I look at the ‘employee-like’ suite of laws which, when originally proposed, had concerned me greatly, and against which I argued at considerable length.

What has surprised me is the extent to which the ‘employee-like’ laws have been watered down from the original plans. In some respects, it’s almost a strange case of ‘nothing has changed!’ I’ll detail why I think this is the case. But I’ll also look at the changes that have occurred as they cannot be ignored.

Photo by R.D. Smith on Unsplash

One thing is certain. The Albanese government has undertaken an historic and damaging step. It has dragged commercial contract transactions into the employment regulatory environment. This should never have even been contemplated, let alone implemented. These laws should be abolished.

That being said, remember that I’m not a lawyer. My explanations and analysis seek to provide some comprehension from a practical ‘on the ground’, ‘how it applies’ perspective.

What the original ‘employee-like’ proposals would have done  

When the original Loophole Bill was first released in September 2023, I put out an assessment of it. I said that:

“The Bill seeks to make commercial transactions subject to industrial relations regulation. It will do this in relation to commercial transactions undertaken by individuals in the earning of their income.

In practical terms the Bill will outlaw:

• The bulk of self-employment;

• Digital (gig) platform operations in Australia;

• Self-employed people from earning their income through digital/gig platforms; and

• Self-employed owner-drivers.”

(See The planned destruction of self-employed small businesses.)

On the surface, the final ‘Loophole Act’ (assented to on 26 February 2024) could appear to do what I said (and feared) the Bill would do. But there are important and significant differences between the original Bill and the final Act which give rise to a different assessment which I shall now explain.

Remember – It’s a pretend legal process

I explained in ‘Enter the new deal-making’ that if you grasp one concept, the ‘penny will drop’ about the true nature of Australia’s industrial relations system. The system is primarily NOT about particular outcomes, but rather is about a complex quasi-legal process to control HOW outcomes are arrived at. Whoever controls the process, controls the outcomes.

That’s the essence to understanding the ‘employee-like’ Albanese industrial relations ‘revolution’. What the laws do is create a process, through the Fair Work Commission, by which the Commission can make orders for things to be done. Let’s look at those ‘things’ that can be done and how it’s done.

First, as the big picture overview, what the laws do is create a parallel industrial relations system for self-employed people, but only for people (a) working through the gig (digital platforms) and (b) working as self-employed owner-drivers.

That is, the laws have seriously narrowed their field of reach when compared with the original proposals. But further, even with gig workers and owner-drivers, the scope of what can be regulated is greatly narrowed. To explain this, I need to dig into the detail of the Act.

I reiterate that I’m not a lawyer. Further, the ‘Loophole Act’ is some 286 pages of convoluted language that resembles the pieces of a jigsaw puzzle scattered across a table. Pulling the pieces together to ‘get’ the picture is complex. What follows is my best interpretation. I’ll qualify that by saying I could have missed things.

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