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For those who pass rewards to agreements, the Labor government has introduced a non-disadvantage test on agreements to ensure that agreements would not be used to reduce wages and conditions relative to bonuses. The awards were awarded as a safety net for business bargaining. The non-disadvantage test contained weaknesses from the start and was gradually watered down by Labour and coalition governments. In addition, the effectiveness of rewards as a safety net has been compromised by changes in the way they operate. Some of these changes have been indirect due to barriers to updating procurement rules and weakening enforcement mechanisms. However, others have been more direct and have been used to reduce the content of labour pricing standards. Under the Labor government, the AIRC had been encouraged to liberalize the rewards clauses, but the big change came in 1996 with the advent of the coalition government, which initiated a process of simplification of public procurement. This meant limiting the AIRC`s powers to 20 “authorized procurement issues.” Other public procurement provisions were prohibited and had to be removed from existing premiums until June 1998 (although some were recovered through negotiations with individual employers who entered into certified agreements and quality assurance agreements). Under common law, Ford v. A.U.E.F. [1969], [8], the courts found once that collective agreements were not binding. Second, the Industrial Relations Act, introduced by Robert Carr (Minister of Labour in Edward Heath`s office), provided in 1971 that collective agreements were binding, unless a written contractual clause indicated otherwise.

Following the fall of the Heath government, the law was struck down to reflect the tradition of the British labour relations policy of legal abstention from labour disputes. The 2005 labour election laws introduced other barriers to changing and updating premiums and perpetuated the narrowing of authorized issues. However, the main effect is elsewhere. Legislation rejects non-disadvantage tests, thus piercing the (mitigated) links that combine agreements and rewards. In response to public concerns, the federal government withdrew slightly in 2007 and introduced a new equity test (Sutherland, 2007). However, the most important mechanism for providing a safety or soil net under agreements is the Australian Fair Payment and Conditions Standard (PSACS). This includes a minimum wage, paid annual leave, paid personal leave, unpaid parental leave and a cap on the normal weekly working time. Scholars (Fenwick, 2006; Stewart, 2006; Cooney, Howe and Murray, 2006) highlighted the limited scope of these provisions. Even in these five cases, they suggest that the appearance of minimum standards is misleading, given that the provisions do not apply to all workers and that there are sufficient opportunities for exemptions where they do.

For example, the four-week annual leave plan does not apply to casual workers and may in any event be partially paid. Nor is there a plausible adjustment mechanism, except for minimum wages (including junior, training and disability salaries, casual expenses and pay and classification scales) that are the province of a new body, the Australian Fair Pay Commission (PSAC) (Waring, Ruyter and Burgess, 2005). The most direct strategies are those that require equal pay for equal work and equal pay for work of equal value. Equal pay for equal work was most effective when they called for the elimination of differences in pay rates between men and women in industrial agreements.