New APS bargaining policy: flexibility versus job security

By Stephen Easton

Wednesday February 7, 2018

The Commonwealth’s controversial public sector workplace bargaining policy has been updated, re-worded and rearranged, but the underlying content remains largely the same, continuing the Coalition’s pursuit of a more “flexible” workforce.

In the 2015 iteration of the policy, the cap on pay increases grew slightly from 1.5% to 2% — where it remains in the new 2018 policy, published late yesterday by the Australian Public Service Commission.

The government’s rationale for its approach to enterprise bargaining in the APS is that like other large employers, it wants more flexibility with its workforce. For employees, this is typically at odds with their desire for job security, which is further undermined by the new policy, according to the Community and Public Sector Union (full response below).

Most of the “key features” of the policy listed by the APSC in a statement can also be found in the old one, although there are a couple of clauses that have raised the union’s ire.

“A number of new flexibilities will be available to agencies, to support business outcomes,” according to the APSC. A spokesperson for the commission told The Mandarin these include:

“Terms and conditions: greater flexibility is available to bargain terms and conditions outside of remuneration. Within an overall policy of no enhancement, conditions of employment may be traded in exchange for gains in other areas, subject to prior approval of the APS Commissioner. Certain conditions will not be considered appropriate for trading including, but not limited to, exchange for a higher salary increase, introducing hour-for-hour [time off in lieu] for Executive Level employees and reducing hours of work;

“Framework: agencies are more explicitly encouraged to consider a broader range of employment arrangements. This could include greater use of individual arrangements instead of, or in combination with, enterprise agreements. This may particularly suit small agencies where bargaining can be resource intensive;

“Pay structure deficiencies: in exceptional circumstances, where entrenched internal structural deficiencies make an agency’s existing pay scale unworkable within the context of its operational needs, the APS Commissioner may agree to reasonable variations that address these deficiencies. This would not include strategies to address attraction or retention issues or machinery of government changes;

“Policy application: Government Business Enterprises and the Reserve Bank of Australia are only required to apply the policy to the extent practicable, and must keep their portfolio Minister and the APSC informed.”

One interesting addition to the policy text is an explicit reference to “side deals” between unions and agencies, which the government is keen to discourage.

This is oddly listed as another measure to give agencies more flexibility to address operational issues, in a summary of the policy that differs slightly from the information above:

“Side deals: side deals with unions, which began to emerge late in the current round, are discouraged. Where an agency considers a side deal is necessary, the APS Commissioner’s approval is required before any deal can be made;”

On this issue, the full-text policy states:

“Unions may seek to enter a side arrangement outside an enterprise agreement. Agencies should respond to such an approach with caution and ensure any side arrangement does not circumvent the enterprise agreement or this policy.”

Commissioner John Lloyd does not have a list of trade-offs that are appropriate — he will approve proposed trades on a case-by-case basis — but he is clear on what agencies cannot put on the table. According to a new set of “bargaining policy Q&As” for public servants:

“Trade-offs must be reasonable, quantifiable, at least cost neutral and conform to longstanding bargaining policies and practices. Trade-offs resulting in changes to baseline pay or superannuation will not be considered, in keeping with the community’s expectations of appropriate terms and conditions for Commonwealth employment.”

As an example, he would consider approving a trade of longer working hours for a Christmas shutdown period.

The underlying premise of course remains the same. All increases to remuneration must be cost-neutral to the government, coming from within existing budgets and without redirecting program funding, cutting output or services, or increasing fees, charges and levies. The government continues to demand that all payrises be offset by what it defines as improvements in productivity.

“Agencies are to identify current and/or prospective productivity improvements from within their operations, which will support the proposed remuneration increases,” says the new policy.

A long line of experts and other commentators have questioned what this means, and especially how the government defines productivity in the public service, including the Productivity Commission after its 2015 industrial relations inquiry.

The PC also suggested agencies should be given more freedom in the process but the new policy makes it very clear that John Lloyd and the Minister Assisting the Prime Minister for the Public Service, now Kelly O’Dwyer, will continue calling the shots. The commissioner must approve any proposal before an agency can put it to the employees and only in “exceptional circumstances” will O’Dwyer approve exemptions.

Any questions?

First introduced in 2014, the Coalition government’s workplace bargaining policy has fuelled an extraordinarily long and acrimonious series of negotiations with unions. However, most public servants aren’t members of their union, the APSC points out in the accompanying Q&As.

“The policy requires the removal of content that provides special privileges to unions,” states a section that strongly emphasises that freedom of association includes the right not to participate in organised labour (unionists might see this as the dubious right to get all the benefits without paying the fees).

“This is to ensure that arrangements are balanced and do not favour one group of employees over another.”

It is in these FAQ-style statements where the APSC explains the current government’s views on workplace relations and makes clear its antipathy to the labour movement. For example, it explains what “special privileges” it believes unions have received in past enterprise agreements:

“It is unnecessary for enterprise agreements to prescribe how union delegates will exercise their representative duties. It is not appropriate to guarantee the use of Commonwealth resources and facilities for union activities. Other inappropriate practices include guaranteeing access for unions to address new staff at induction sessions and not providing employees with the choice to opt-out of union communications.”

Another of these statements concerns one of the biggest sticking points in enterprise bargaining negotiations of late, content from past agreements being moved into policy or guidelines.

This sets out the government’s argument that it has not demanded any “cuts” to employment conditions, a claim the union is likely to reject, and argues there has been confusion about what “conditions” really are. The APSC says they are things like leave, allowances and penalty rates.

“Some people have confused administrative clauses that represent HR policy and procedures, or special arrangements for unions, with actual employment conditions,” it argues. “These types of clauses are not employment conditions.”

The commission says it’s been on a mission to remove “procedural” requirements from EBAs and put them into human resources policies so the agreements are clear and easy to read. The Community and Public Sector Union has previously argued this has weakened some existing entitlements. However, the APSC contends:

“Over the past 20 years, clauses relating to HR processes or practices have continued to creep into enterprise agreements through each bargaining round. The cumulative effect of this is that many public sector enterprise agreements have become long, difficult to read and are considered inflexible.

“In some cases, HR has not been able to make sensible changes to policy and procedures to improve productivity in an agency because arrangements have been locked into the enterprise agreement. There are also many examples throughout agreements of clauses being in conflict with other clauses. This is not helpful to agencies or their employees.”

In “The context for for APS bargaining” the APSC explains the Turnbull government’s priorities in the bargaining process are to introduce much more “flexibility” into the APS workforce and maintain “very tight agency budgets” into the foreseeable future.

It appears that at least one purpose of this week’s new publication was to set out this series of debating points for the commission’s ongoing arguments with the CPSU.

The release of the new policy was foreshadowed by Lloyd in the last round of Senate estimates in October, but its publication this week caught the union by surprise.

The union responds

The new workplace bargaining policy has not been well received by the CPSU, whose officials have been poring over it this morning.

They particularly took issue with the explicit encouragement of individual employment agreements, which “undermine enterprise bargaining and wages and conditions overall” in the view of national secretary Nadine Flood.

“It bears a frightening resemblance to the bad old days of WorkChoices and AWAs,” said Flood, who described the new document as a piece of evidence that “our workplace rules are broken in this country” in line with a campaign by the Australian Council of Trade Unions.

She added that the new policy contained “a clause designed to ensure the continued growth in wasteful and illogical spending on contractors and labour hire arrangements” among other elements that would undermine job security.

“This bargaining policy is bad news, just like its recent predecessors that have done [so] much damage to Commonwealth agencies, the people that work in them and the critical services they provide,” Flood said.

“This policy continues a destructive approach that bars workers from genuinely bargaining for decent wages and conditions.

“The Turnbull Government’s demand through this policy for ‘wages restraint’ for workers who’ve just endured a three-year wage freeze is obscene.

“Australia has a huge problem with stagnant wages growth and job insecurity. These issues are dragging on economic growth and hurting ordinary Australians, and this new bargaining policy shows the Turnbull Government is part of the problem and not the solution.

“After four long years the previous round of bargaining still hasn’t finished for some Commonwealth workers. It’s been the most protracted and messy round of Commonwealth bargaining in 30 years, and yet this new policy shows they’ve learned absolutely nothing.”

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