Management at the Department of Employment have made the best of a difficult situation by consulting openly with staff about the different ways it can achieve savings for pay rises.
Five cost-cutting initiatives were identified and put to staff last week, along with two combinations of those initiatives that could result in a pay rise — one of which includes job cuts, and another a negligible pay rise.
The department spokesperson told The Mandarin employees have been encouraged to provide feedback on the two pay increase options, “or any combination of the productivity initiatives put forward for consideration by the department”.
Today, a little more than 1800 public servants will give their feedback via managers on those options.
The base option offers a pay rise of 1.7% over three years (0.5%, 0.6%, 0.6%). This deal is offset by the removal of the half-day closedown before Christmas, removal of Health-Related Allowance, increased increment points in the salary range for each classification and increasing period of temporary performance to payable after 10 continuous days.
The alternative has a higher pay increase, 2.8% over three years (1%, 1%, 0.8%), with all the above condition cuts and a few more. Working hours will increase, understood as an extra 30 minutes per week, and the staff footprint will be reduced by 46 through natural attrition. The spokesperson said:
“The information has been discussed with bargaining representatives, and it was provided to employees on 18 November 2014 to assist them to understand how options for the remuneration component have been calculated. It is not a formal pay offer.
“The Department is seeking employee feedback on which of the options they are more supportive of to enable us to work with the bargaining representatives on the final offer to be put to an employee ballot.”
The department acknowledges that not all five savings initiatives will be acceptable to employees: “If that is the case, some initiatives may be removed and the associated value of the pay offer would also be reduced.”
Employment Minister Eric Abetz defended the productivity-linked negotiation process, saying he’s not getting any pay rise. He said at a media doorstop in Parliament today:
“This is in the context where we are borrowing $1000 million a month just to pay the interest on existing borrowings, so any increased wages for anybody ultimately comes out from even more borrowings. That is why I — on behalf of the government — went to the remuneration tribunal saying that for MPs the pay increase should be zero, nothing at all.”
University of New South Wales professor of human resource management Michael O’Donnell says these offers are an extremely hard sell, especially to a department workforce that is highly unionised. “They’re picking on places that have a history of taking on the government, are quite militant … They’ll be reluctant to take a deal that cuts this many conditions,” he told The Mandarin.
While there were many Australian examples of public service jobs and conditions being cut through fiat or restructure, O’Donnell says the public service hasn’t seen conditions cut through pay negotiations in living memory. This government’s transparency in its intent to reduce conditions through a pay negotiation was unprecedented and could shape the future of the industrial disputes in the sector, which has seen falling union membership.
O’Donnell says as the union membership falls in some departments, “governments may see it as opportunity to have a go [at more cuts]” and there could be a real chance that employees will accept without taking industrial action. But not at Employment, where O’Donnell says staff are too knowledgeable, too organised to not take action.