With rising costs of living putting pressure on all parties involved in enterprise bargaining, employers are being encouraged to respond strategically to ambit claims.
Many businesses are facing wage increase demands of up to eight per cent following a higher-than-usual 5.2 per cent rise in the National Minimum Wage in July.
At the same time, employers are facing spiralling operating costs.
“There is a comparable cost increase,” Lee Buntman, Senior Adviser - Workplace Relations, Ai Group, said.
“An equal amount of pressure is being applied in cost of living versus operational costs which has created this exacerbation of employers trying to manage those operational costs down, and employees seeking higher wages to manage their own personal pressure of cost of living.
“Following the Fair Work Commission’s Annual Wage Review 2021-22 Decision, we are seeing bargaining claims steadily increase from the unionised side of the enterprise agreement.
“Unions are looking at that (5.2) percentage and saying: ‘that's what we should be getting as a minimum’.
“However, employees sometimes forget their companies are trying to operate in a manner which gives them secure employment.
“So, where claims were starting at three or four per cent, I'm now seeing sixes and sevens.”
Many variables influence how a company should respond.
“It depends on the organiser, the delegate and the workplace which is why there's no single answer,” Mr Buntman said.
“For our members, we are saying it is likely you will see claims increase and how you manage those claims is part of a strategic response of bargaining.
“From a cost-of-living perspective, there is pressure on all the bargaining parties, so you need to strategically communicate that and work out who are the key stakeholders for that purpose.”
Ai Group Workplace Lawyers have a national team of workplace and industrial relations lawyers and consultants highly experienced in enterprise bargaining.
“We've got practitioners from different backgrounds to give you the expertise you need in the bargaining room and behind the scenes,” Mr Buntman said.
“It’s important to have a good strategic approach in a controlled setting with ground rules.
“Generally, everybody's trying to work together to achieve an outcome where everybody can be happy because you don't want your workers to be unhappy; you want them to be able to pay their bills.
“You also want the company to be able to operate successfully. When everybody's working together to achieve that, that's good.”
Be prepared before bargaining even begins.
“It's important to do your homework to determine where you sit in the market and what you can and can't do before you get into bargaining, such that you have a strategy in place around what you're going to communicate and how are you going to communicate it,” Mr Buntman said.
“We generally do this homework for our clients because there are legislative requirements around how you bargain.”
Businesses should also be aware that the process is much more thorough than it was several years ago.
“The Commission has a bigger team that goes through the agreement with a fine-tooth comb and really works you hard to evidence how you've complied,” Mr Buntman said.
“That wasn’t happening three, four, five years ago.
“The stat dec you used to have to put in has gone from nine pages to 19 pages long. It's a highly thorough legalistic process now.”
Shaun Kelleher, Manager Workplace Relations – Hunter & Newcastle, Ai Group, said it was imperative that businesses kept employees in the loop.
“One of the important things for employers to think about in responding to wage increase claims in bargaining is to ensure employees are kept aware of what the market looks like and what sort of cost pressures and opportunities the company is facing so employees don't come to bargaining in a position where they aren't any the wiser about the realistic financial position of the business.
“Communication is key — not just during the bargaining period, but in terms of your engagement strategy with employees on an ongoing basis.”
If you have any questions about enterprise bargaining, please contact Ai Group Workplace Lawyers on 1300 55 66 77.
Wendy Larter is Communications Manager at the Australian Industry Group. She has more than 20 years’ experience as a reporter, features writer, contributor and sub-editor for newspapers and magazines including The Courier-Mail in Brisbane and Metro, the News of the World, The Times and Elle in the UK.
