The economic shocks of COVID-19 and the associated government responses have rendered aspects of our industrial relations regulations unworkable and/or perverse. While the system of regulation was initially a federated role in which the states played significant roles, the federal jurisdiction is now dominant. Apart from Western Australia, all other states have referred their industrial relations powers to the Commonwealth. A state government intent on creating an environment conducive to business investment and strong employment growth might consider resuming its industrial relations powers from the Commonwealth.
There have been some temporary changes made to some awards as well as to the Fair Work Act to accommodate the government’s wage replacement scheme, JobKeeper. It is unlikely that the award changes will be made permanent, given the opposition of the trade unions. In relation to award simplification, the making of enterprise agreements and compliance/enforcement, there is little prospect of agreement between the parties. The federal government should consider the option of introducing a streamlined and simple award covering small businesses. Another option would be enterprise contracts contemplated by the Productivity Commission, in which small businesses could seek variations to awards based on light-handed oversight.