NSW Labor promises to end the Coalition’s unfair employee related expenses cap



If NSW Labor wins the March 23 state election it will get rid of the Liberal/National Government’s unfair employee related expenses cap (the Wages Policy).

Labor will introduce a collective bargaining framework that would allow the Union and NSW Health to bargain in good faith and allow the NSW Industrial Relations Commission (IRC) to grant work value and productivity-based changes to conditions and pay.

What is the Wages Policy?

When the Liberal/National Government was elected in 2011 one of its first acts was to strip the IRC of its power to set fair wages and conditions. The Government set up an unfair policy and legislative framework to make it very difficult for unions like ASMOF to win improved wages and conditions for our members.

This was a deliberate attack on unions and our members conditions and pay. It was also a clear undermining of the IRC’s role as the independent umpire.

The Government’s policy denies us the basic right to collectively bargain over wages and conditions or to have members’ wages and conditions determined by an impartial and independent arbiter. In practice the policy enables the Government, in its capacity as an employer, to unilaterally determine the wages and conditions of its employees.

The wages policy means:

  • our members may be awarded increases in remuneration or other conditions of employment that do not increase costs by more than 2.5 per cent per annum.
  • increases in remuneration or other conditions of employment that increase employee related costs by more than 2.5 per cent per annum can only be awarded if sufficient employee related cost savings have been achieved to fully offset the increased employee related costs.
  • no value is to be assigned to productivity improvements unless they are directly identified with changes to remuneration and conditions of employment or work practices specifically those matters contained in industrial instruments.

The policy has been spectacularly successful in limiting wages increases and preventing important and necessary improvements to your conditions of employment. In fact, over the last eight years ASMOF, and other unions, have found it impossible to achieve fair pay rises in bargaining and to pursue Award improvements, or even fight Award breaches.

The Government’s policy has also contributed to a broader wage suppression and dampening of consumer spending. In their report False Economies - The Unintended Consequences of NSW Public Sector Wage Restraint, researches Troy Henderson and Jim Stanford consider the harmful side-effects of the Government’s wages policy, including:

  1. Over the five years from 2011 through 2016, the state’s public-sector wage suppression reduced consumer spending in the state by a cumulative total of $3.4 billion, harming businesses large and small.
  2. The NSW government’s wage austerity therefore reduced its own revenue (through that reduction in GDP) by an estimated $1.2 billion over the 2011-16 period.
  3. Each public-sector worker’s “workload” increased by 7.5 percent in the last five years – yet the wages policy in fact suppresses true productivity growth in the public sector.
  4. The NSW government’s extraordinary interventions, removing normal wage bargaining rights from a significant and influential section of the state labour market, have contributed to the unprecedented stagnation of wages in the overall state labour market – one that the government itself admits is hampering both economic growth and fiscal well-being.

The longer the wage cap remains in place, the larger will these costs (of foregone consumer spending, offsetting reductions in state revenues, and the spill over impact onto private labour market outcomes) become.

In 2018 we called on both side of politics in NSW to:

  • Remove the wages cap
  • Make the IRC independent again with sufficient resources to run applications in a timely and just manner
  • Allow agencies like NSW Health and the Union to collectively bargain and to agree on outcomes that encapsulates work value/productivity and work health and safety issues, and
  • Not undertake any further privatisation of services.

Labor has promised to:

  • Abolish the Public Sector (Conditions of Employment) Regulation 2014 and repeal s146C of the IR Act that gives legislative forces to the Governments unfair Wages Policy and removes the independence of the IRC.
  • Keep the 2.5 per cent target as a floor for increases, and not a ceiling as it currently is.
  • Link remuneration increases above 2.5% to evidence-based arguments relating to productivity increases, work value, pay equity and work flexibility.
  • Restore the independence of the IRC.
  • Allow unions to arbitrate on important matters for our members (like work value and work health & safety) without the artificial limitation imposed by the current law.
  • Ensure that a proper framework of good faith bargaining would be restored in the NSW Public sector.

Why is this important for ASMOF and our members?

Because the NSW Government’s policy is unfair, it limits free collective bargaining, and it does not comply with the principles of freedom of association and collective bargaining laid down in ILO conventions.

The overall effect is that NSW salaried doctors have gone from being the best paid in Australia with the best conditions to near the bottom under this Government.

Under this Liberal/National Government we cannot negotiate in good faith on things like:

  • members being paid at the appropriate classification
  • ensuring members cannot be rostered in an unsafe way
  • limiting shift length
  • mandatory minimum break between shifts
  • limiting the number of consecutive night shifts that can be worked
  • workload monitoring provisions
  • allowing unaccredited registrars to be rostered no less unfavourably than accredited registrars,
  • enforceable unrostered overtime provisions

Labor’s policy will reinstate a fair and balanced approach in NSW that restores the link between wages/conditions and work value and productivity and enable the Union to go to the IRC and argue our case based on the evidence and fairness and not constrained by artificial and arbitrary constraints.

Labor has also committed to a range of other actions to secure fair work conditions and promote safe workplaces. Labor has stated that they will:

  • Amend anti-discrimination laws in NSW to:
  • o Ensure employers reasonably accommodate employees requiring flexible work arrangements due to pregnancy, family responsibility, a caring role, or who are older or returning to work following an illness

    o Protect from discrimination due to pregnancy, parental leave or other caring commitments.

    o Include mechanisms for inquiry, evaluation and correction of gender pay discrimination

  • Ensure SafeWork NSW is resourced to improve workplace safety and address bullying
  • Promote awareness of the rights of pregnant workers
  • Make the NSW Government a model employer
  • Reform the public sector including by reviewing the use of contractors, casual workers and temporary employees to ensure there are only used when necessary.
  • Re-establish the Industrial Court of NSW so salaried doctors can take their claims to a court which specialises in work matters.