The federal industrial relations minister, Christian Porter, has accused Labor of “desperation” after it claimed the Coalition’s proposed workplace changes could lead to pay cuts of $11,000 for frontline workers.
The opposition, in a demonstration of the scare campaign it could run on the issue, spent the final question time of the year arguing the bill could result in the loss of “every penalty rate and shift allowance” for workers on enterprise agreements.
Earlier on Thursday, Porter promised to “listen” to critics but denied he was preparing to ditch the bill’s most controversial plank – a provision allowing the Fair Work Commission (FWC) to approve deals that left workers worse off than the relevant award.
Employer groups including the Council of Small Business Organisations Australia (Cosboa) and the Australian Retailers Association (ARA) have urged the Morrison government to stay the course on changes designed to help businesses hard hit by Covid-19.
The Fair Work Commission on Thursday also confirmed it would conduct a review of awards covering retail, hospitality, restaurant and registered and licensed clubs, opening the door to “loaded rates” that could replace penalty rates with higher base rates of pay.
Since Porter introduced the bill on Wednesday, Labor and the unions have objected most strenuously to the two-year suspension of the better off overall test (Boot) for enterprise agreements.
Subject to safeguards including majority employee approval and that the agreement is not contrary to the public interest, the bill would allow the commission to register pay deals that do not leave workers better off compared with the award minimum rates.
The provision is backed by employer groups including the Australian Industry Group and the Australian Chamber of Commerce and Industry.
The Cosboa chief executive, Peter Strong, said the provision had “to go through”.
“It’s not about cutting pay rates, it’s about managing your business and everything else in the agreement so you can survive,” Strong told Guardian Australia. “If you’re a worker you’d rather have a job than not have a job.”
Strong promised to “continue to pursue it, and if a business closes as a result [of the Boot] we will highlight it.”
Nevertheless, Strong accepted the need to be “pragmatic” because “there are many other changes in the bill we’d like to see around casuals and permanent part-time workers”.
The ARA chief executive, Paul Zahra, said he expected “there will be hard-hit retailers who will make use of these provisions as they push through their recovery period”.
Zahra said the two-year suspension was a “step in the right direction” to revitalise workplace pay deals to boost productivity and jobs. He said there was “no reason the FWC shouldn’t consider the impact of Covid-19 and the views of employers and employees when approving an enterprise agreement”.
“The changes have the right checks and balances in place, including that the views of the people who matter, the employees, are respected.”
Asked if the government was preparing to ditch the provision, Porter told reporters in Canberra: “Not at all.”
He said the changes were “important because they offer an avenue for very distressed businesses” to strike agreements. The minister claimed the effect would “absolutely” be limited despite nothing in the bill specifying the extent of Covid-19 losses required for approval.
Porter rejected a suggestion of adding a turnover test, arguing that would be “clunky and unworkable”.
He promised to listen through the Senate inquiry consultation process, suggesting there may be “clarifications that people want about those paragraphs” and that not “every single sentence” would remain unchanged.
In question time, Porter said the government would not back down on cuts to take-home pay because “we haven’t done” that, accusing Labor of “desperation” and Anthony Albanese of “jumping the shark”.
Labor MPs asked a series of hypothetical questions about workers who they claimed could be up to $11,000 a year worse off in aged care if they lost “every penalty rate and shift allowance”. Cleaners could lose $6,600 and pharmacy assistants faced cuts of $6,000, the opposition said.
Porter replied that such cuts “just wouldn’t happen” because of existing safeguards, including that employees would never vote for such an agreement.
“It doesn’t happen now. It would not happen under any of the changes that we are suggesting before the parliament.”
In addition to the Senate inquiry into the bill, Porter has asked the FWC to review awards to simplify the classification of workers and consider adding the ability to pay “loaded rates” that replace penalty rates.
The FWC president, justice Iain Ross, noted on Thursday that the commission had considered “loaded rates” in the past in penalty rate cases and the four-yearly review of modern awards.
“In both of these cases, the full bench noted that there was merit in considering the insertion of loaded rates into the hospitality and retail awards,” he said.
