The Minister for Employment and Workplace Relations Julia Gillard announced (04/11/09) that the Government has reached agreement with the major union representing social and community services workers, to support the conduct of a major test case on pay equity for community sector employees under the new Fair Work system.

The agreement with the Australian Services Union (ASU) is made in anticipation of the creation of the new national workplace relations system for the private sector from 1 January 2010 following references of powers from the States.

Under the new Fair Work system, social and community services sector workers – working in the youth, welfare and community sectors – will become covered by the Fair Work Act and a single modern award, rather than the multitude of state and federal laws, awards and instruments that currently apply.

The Fair Work Act 2009 introduced changes that enhanced the ability of Fair Work Australia to make orders that provide for pay equity between men and women employees. The Act now refers to a right to equal pay for work of comparable value as well as equal value. This reflects the approach already taken in many states and territories.

The agreement with the ASU ensures that recent pay rises awarded to social and community services workers in Queensland on pay equity grounds will be maintained in full when those employees transfer to the Fair Work system.

The ASU has advised the Government that it will apply to Fair Work Australia in the near future seeking orders for similar pay increases based on pay equity grounds for social and community sector workers in the other States. This will be the first claim to be considered under the new, enhanced provisions of the Fair Work Act and will therefore be a significant test case. The sector employs more than 200,000 employees, 87 per cent of whom are women.

The Australian Government has now agreed to work with the ASU to support Fair Work Australia in developing an appropriate equal remuneration principle for the federal jurisdiction and to provide research (such as labour market information) to assist Fair Work Australia in determining the pay equity claim.

The Government has also agreed to assist the ASU, employers and employees in the sector to successfully manage the transfer to the new national system by providing a guide to termination of employment and ensuring employers provide for adequate dispute resolution processes.

These arrangements will provide certainty of coverage, pay equity, transparency and fairness in workplace relations for highly-valued community sector workers across Australia.

At this time, Victoria has completed its referral to the Commonwealth and South Australia, Tasmania and Queensland have introduced legislation to their Parliaments. Productive discussions are continuing with New South Wales. Western Australia has refused to refer its private sector workplace relations powers to the Commonwealth.

The Minister has asked Western Australia to reconsider its position so that all private sector workers are able to benefit from the Fair Work Act from 1 January 2010.

The agreement with the ASU will be tabled at the consultations on the exposure draft of the modern social and community services award being held by the Australian Industrial Relations Commission (AIRC) in Melbourne tomorrow.

Sector response:

“ACOSS congratulates the Australian Services Union and Federal Government for setting in train a process to address the low wages of community sector workers,” said Clare Martin, CEO, Australian Council of Social Service.

“We strongly support the test case as a vital step towards long-awaited pay increases for community workers. Low wages have meant the community sector has long-battled workforce shortages and problems of attracting and retaining well-qualified staff.

“This announcement follows in the steps of a recent Queensland decision which lifted pay rates for SACS and CASH workers by 18 per cent to 37 per cent to be implemented over three years, and sets a precedent for wage increases under national arrangements.”