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David Bates
+ About David Bates

David is the Managing Director of Workforce Guardian where he provides a wide range of strategic, practical and plain-English advice to Australian business owners and operators. He is deeply committed to assisting employers and is a passionate advocate of competition and free-enterprise.

David gained his BA (Government) from the University of Queensland in 1998 before going on to complete a Law degree, with Honours, in 2001. He began his career working for a large, blue-collar union before moving to Canada and then the United Kingdom where he was employed by both the Commission for Racial Equality and the UK Equality and Human Rights Commission.

David routinely represents employers in Fair Work-related proceedings and can assist with every aspect of employment relations compliance. David is also an accomplished and highly sought-after public speaker who facilitates dynamic, informative and highly interactive workshops on all aspects of industrial relations best-practice.

He is proud to lead a highly-qualified team of ER, HR and Technical professionals at Australia’s leading, online employment relations service.

More HR myths busted

Wednesday, March 29, 2017

By David Bates

A lot has happened in the world of Fair Work since my last appearance on the Switzer program … and none of it has been good for small businesses. 

Given the nature of the 24-hour news cycle – and the might of the Australian Council of Trade Union’s (ACTU) media machine – a range of damaging myths about these Fair Work developments have been incorrectly reported as facts … so let’s set the record straight:

Myth #1: The Turnbull Government is ‘Ripping Away’ Penalty Rates from Aussie Battlers.

Question: Who set up the review which resulted in the Fair Work Commission reviewing Modern Awards? 

Answer: Labor’s Julia Gillard.

Question: Who specifically instructed the Fair Work Commission to look at penalty rates during their review?

Answer: Labor’s Bill Shorten.

Question: Who appointed the current President of the Fair Work Commission?

Answer: The Labor Party

Question: Who promised to respect the decision of the ‘independent umpire’, even if they decided in favour of reducing penalty rates?

Answer: Labor’s Bill Shorten.

Noticed the pattern of brazen hypocrisy yet?

Myth #2: The Turnbull Government Understands Small Businesses.

Sorry to tell you, they don’t. If they did, Employment Minister Senator Michaelia Cash would have managed to appoint at least one small business owner during her last round of appointments to the Fair Work Commission last week.

While employers should at least be thankful that none of the appointees are former trade union officials (because former employee advocates already comprise the majority of appointed Commissioners), it is simply unfathomable to me (and countless others who don’t belong to the IR boys club) that not a single small business owner was considered worthy of appointment to the Commission.

Want to reform the Commisssion and inject some much-needed common sense into this  apparently ‘partisan and dysfunctional’ (the description provided by recently-departed Commission Vice-President Graeme Watson) organisation? Appoint some small business owners.

Myth #3: The ACTU deserve a seat at the table.

No, it doesn’t. The ACTU is now a shadow of its former self. Once upon a time, its leaders worked constructively with government and employers to bring about important social reforms and protect the rights of workers.

Nowadays, it’s a socialist shambles that has no respect for either our democracy or the rule of law.

But don’t take my word for it – take the word of the ACTU’s new secretary, Sally McManus, instead.

When asked on the 7:30 program if she supported the rule of law (you know, that pesky thing that separates our country from third world dictatorships), Sally said yes. But Sally then said it was perfectly fine to break laws if you felt they were unjust. Seems Sally may not have really understood what ‘the rule of law’ means after all.

So, in Sally’s world, if you think income tax is unfair: don’t pay it. If you think the speed limit is for schmucks: just ignore it. If you don’t like workplace health and safety laws: pretend they don’t exist.

I call it the ‘Silly Sally Defence’: if you personally feel a law is unfair, you can just disregard it. 

And how did ACTU President Ged Kearney respond to Sally’s extraordinary disregard for our nation’s laws? She called her ‘refreshingly honest’.

Ready to close your business yet?

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Annual leave changes causing confusion

Wednesday, March 15, 2017

By David Bates

If your employees are covered by one of the nation’s 122 Modern Awards, chances are you’re unaware significant changes were made by the Fair Work Commission to their annual leave entitlements in 2016.

These changes – many of which were made after years of lobbying by employers – are of considerable importance to you and your business. They allow:

  • employers to direct an employee to take annual leave once they have accrued an ‘excessive’ annual leave balance; and
  • employees to cash-in a portion of their accrued annual leave; and
  • employers to recover annual leave ‘debts’ via deductions from final pay if an employee has been provided with annual leave in advance of its accrual, and the employee subsequently leaves before their accrual has returned to a positive balance.

Crucially, however, these changes generally only apply to employees who are covered by a Modern Award which has been specifically amended by the Fair Work Commission (most of them have been). Given that Modern Awards apply as a matter of law and not choice or preference, it’s accordingly very important for all employers to confirm:

  • if their employees are covered by a Modern Award; and
  • whether that Modern Award has been varied by the Fair Work Commission to include the above-mentioned changes.

For those employers already familiar with Australia’s employment laws, it won’t be surprising to learn these annual leave changes are accompanied by a large number of very strict rules which must always be carefully followed. 

For example, if an employee wants to cash-in some of their annual leave, they must:

  • have a remaining balance of at least 4 weeks’ annual leave after the cashing-in has been processed; and
  • be paid the same amount that they would have received had the annual leave actually been taken; and
  • record the agreement to cash-in annual leave in writing; and
  • not cash-in more than two weeks of annual leave in any 12 month period.

Phew!

Despite the abundance of bureaucracy imposed by the Fair Work Commission, these changes are ultimately good news for employers. Of course, they’re of no benefit at all if employers don’t know about them. 

Given how rarely the Commission appears to support businesses these days, it’s definitely worth taking the time to familiarise yourself with the Awards which apply to your workplace and making the most of these recent amendments.

 

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Fair Work Ombudsman throws in the towel

Thursday, March 09, 2017

By David Bates

For more than seven years now, the team at Workforce Guardian has consistently described Australia’s so-called ‘Fair Work’ laws as ‘hopelessly complex’. We’ve backed this claim by comparing Australia’s workplace relations system with those in comparable jurisdictions such as New Zealand, the UK, and Europe.

Only here do we maintain an archaic system of over 100 ‘Awards’ which baffle and befuddle small business owners.

Only here do we force employers to sift through ‘Pay Guides’ – some almost 200 pages long – to determine how much employees need to be paid.

Only here do we allow former trade union officials with no legal qualification to sit as judge and jury at an employment tribunal which we know – thanks to the frank admission of former Fair Work Commission Vice President Graeme Watson – is widely regarded as ‘partisan’ and ‘dysfunctional’.

So, isn’t a relief we have a Commonwealth tax payer-funded agency responsible for ‘educating people working in Australia about fair work practices, rights and obligations’.

Well, it would be a relief if that agency actually did its job.

It doesn’t.

And the proof is in the incredibly high rates of non-compliance with our (hopelessly complex) employment laws which are consistently confirmed by the Fair Work Ombudsman itself.

Think 7-11 underpayment scandal. Think Pizza Hut scandal. Think general incompetence.

And now, it seems, the Fair Work Ombudsman has simply decided educating employers about their obligations is all just too hard. So, instead, the agency responsible for educating employers is going to force advisors to business – bookkeepers, accountants, HR consultants – to do their job for them.

They’re doing this by increasing their reliance on section 550 of the Fair Work Act, which allows the Ombudsman to prosecute anyone who is ‘knowingly involved’ in a breach of the Fair Work Act.

This remarkable section even extends liability where the party accused of being knowingly involved in the breach indirectly didn’t do something (yes, you read that right). This is because the section expressly states an advisor to business can be prosecuted as an ‘accessory’ as a result of a direct or indirect act or omission.

Rather than doing the job it was set up to do, the Fair Work Ombudsman is going to force business advisors to do it for them under threat of prosecution as an accessory if the employer isn’t fully-compliant with Australia’s (hopelessly complex) employment laws.

Raising the white flag of surrender … the latest chapter in the debacle that is the Fair Work Ombudsman.

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6 facts about the penalty rates decision

Tuesday, February 28, 2017

By David Bates

Last Thursday’s decision by the national employment relations tribunal, the Fair Work Commission, to reduce penalty rates for some employees on Sundays and public holidays was completely unsurprising to all of us who have followed the Commission’s work in this area.

Equally unsurprising was the near hysterical reaction of both unions and the members of the political party owned and operated by the unions.

So, let’s pause for just a few minutes and look at the cold, hard facts.

Fact #1: The only reason the Commission looked into penalty rates at all was because Bill Shorten told it to! Back when he was Employment Minister in the last Labor government, Bill Shorten expressly directed the Commission to look at penalty rates when it conducted its first four-year review of Modern Awards. Talk about an own goal.

Fact #2: In April 2016, Mr Shorten stated unequivocally that he respected the independence of the Fair Work Commission, and promised neither he, nor his party, would stand in the way of any reductions to penalty rates if these were ordered by the Fair Work Commission. It seems his promise to respect and preserve the independence of the Commission didn’t go down too well with his comrades in the union movement.

Fact #3: On the night of the Commission’s decision, Mr Shorten invited a young retail worker to front the cameras and explain how ‘gutted’ he was by the Commission’s decision. The only problem was that the young man works for Coles and is covered by an Enterprise Agreement. As a result, the Commission’s decision actually doesn’t impact him at all. #oops

Fact #4: The Enterprise Agreement which covered the young man in question was negotiated between the SDA (the militant retail union) and Coles. And guess what? That Agreement had long ago reduced penalty rates to below the Modern Award rates. Put another way, the union had already cut penalty rates for precisely the same employees they now claim will be devastated by the Commission’s decision to do exactly the same thing. Now that’s embarrassing.

Fact #5: Only employees covered by 5 of the 122 Modern Awards are affected by the Commission’s decision. Furthermore, we don’t even know yet when the changes to Sunday penalty rates will apply because the Commission hasn’t made up its mind. The changes to public holiday penalty rates will apply from 1 July this year.

Fact #6: Penalty rates have not been abolished! The Commission has announced reductions in some penalty rates paid to employees covered by some Modern Awards some of the time. The sky is not falling down. The sun will rise tomorrow. And the person most responsible for the Commission making the decision to reduce penalty rates is the Hon Bill Shorten, who never lets the facts get in the way of a good story.

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Time to restore confidence in the Fair Work Commission

Wednesday, February 22, 2017

By David Bates

With a number of Commissioners resigning from their lucrative and life-long (well, until 65) appointments to the Fair Work Commission, the Minister, Senator Michaelia Cash, has confirmed that replacements will be announced in the near future.

So I dare the Minister, no – I double dare her – to finally appoint some actual small business owners to fill these vacancies.

Quite frankly, the last few years have seen the last of the Commission’s credibility go up in flames. Whether it was the train crash behaviour of former Vice President Michael Lawler (he of the extraordinary Four Corners interview while on 11 months of fully-tax-payer-funded personal leave), or the more recent departure of Vice President Graham Watson (who sent a scathing letter of resignation to the Minister describing chaos and dysfunction), there are very few still of the opinion the Commission is meeting the community’s expectations.

So, enough is enough, Minister. No more top-of-town lawyers being tapped on the shoulder for the Commission please.

And, for the love of God, please don’t appoint any more trade union officials to what is already a union-dominated Commission.

And just in case you’re tempted to take the easy option, please don’t appoint the current Fair Work Ombudsman, Natalie James, to the Commission either. The last thing the Fair Work Commission needs is another career public servant deciding the fate of small businesses.

I know this is novel and a little ‘out of the box’, but how about appointing some people who’ve actually run a small business? You know, people who understand the long hours, hard work, and thankless effort that’s required to keep the lights on, the employees paid, and the customers happy.

You might not think ‘Nancy the newsagent’ or ‘Dan the drycleaner’ are qualified to be Fair Work Commissioners. But let me assure you they know more about the real world, managing staff and running a business than an employer association lawyer or trade union official ever will.

Imagine the common sense and integrity Commissioners like Nancy and Dan would bring to the table. Imagine how hard they’d work (because they’re used to it). Imagine how excited they’d be to help others – employers and employees alike – resolve their disputes and run successful businesses. Imagine their unique insight into the realities facing employers and employees in contemporary Australian small businesses.

Go on Minister, be brave. Accept my challenge. Ruffle a few feathers and put an end to the ‘business as usual’ approach that has virtually destroyed public confidence in the Commission. It’s up to you.

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High hopes for Michaelia Cash, dashed

Wednesday, February 15, 2017

By David Bates

I had high hopes for the current Employment Minister, Senator Michaelia Cash. Many employers did. She seemed like a Minister on top of her brief, someone who genuinely understood all that’s so deeply wrong with Australia’s hopelessly complex employment laws and, just as importantly, someone with the ability to quickly begin putting things right.

And then came the last federal election. An election which had been called because of the Senate’s refusal to pass the Coalition’s Bill re-establishing the Australian Building and Construction Commission (ABCC). 

You would have thought an election triggered by contentious employment-related legislation would have seen the Employment Minister given a very high-profile role during the grinding, eight-week long campaign.

But, no, the Employment Minister went missing in action. An election which could have been fought on the need to restore the rule of law on construction sites, end union thuggery and corruption, and finally provide small business owners with the flexibility they so desperately need and deserve was completely overshadowed by Labor’s so-called ‘Mediscare’ campaign.

There’s a word to describe the Coalition’s last federal campaign: pathetic.

And now, the icing on the cake. 

For at least two years now, employers and unions (yes, both sides!) have been calling on the Minister to amend the law to prevent Enterprise Agreement applications being thrown out because of minor errors made during the negotiation process. In some cases, for example, Agreements which had taken over a year to finalise were rejected by the Fair Work Commission because employees had been given the wrong website address to visit for more information. There’s a word for that too: ridiculous.

This week, the Minister (finally) announced the laws will be changed. Hallelujah. 

But if it takes this long for the Minister to approve minor amendments which are supported by both employers and unions, what hope is there of her making those other vital changes small businesses need and which unions violently oppose? Not much.

So, folks, it looks like this is as good as it gets. 

No other developed country on Earth expects small business owners to read and comply with endless pages of incomprehensible, union-friendly, pro-employee rules and regulations. 

No other developed county on Earth forces its small business owners to justify the dismissal of their employees before a tribunal comprised mostly of former trade union officials with no legal qualifications.

And no other developed country on Earth would allow their parliamentarians and unelected bureaucrats to suffocate small businesses with the kinds of inane and illogical laws and regulations employers routinely face here in Australia. 

My high hopes are well and truly dashed.

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Small business won’t miss this Coalition Government

Wednesday, February 08, 2017

By David Bates

When the next federal election comes around and the Coalition inevitably loses the ability to govern (either in its own right or at all), confused and defeated Liberal and National MPs will no doubt wander around wondering ‘what went wrong’ and ‘how did it come to this’.

To those Coalition MPs: this is what went wrong, and this is why you were defeated:

1. Your election campaigns focussed on your support and respect for Australia’s small business owners. But then, after you’d been in power for a while and thought no one was looking, you quite happily dumped the small business portfolio onto a minister who isn’t even a cabinet member. Turns out you only cared about small business owners when you needed our votes.

2. You implemented no meaningful reforms of any kind whatsoever to Labor’s anti-small business Fair Work laws. Yes, you talked and talked about ‘innovation’, flexibility’, and ‘agility’, but you didn’t bother listening to any of the stakeholders who told you time and time and time again that the current laws make achieving any of those lofty ambitions virtually impossible.

3. You ran an entire, two-month long, double-dissolution election campaign without mentioning workplace relations. That could, perhaps, have been forgivable had it not been for the fact:

  • the entire election was actually triggered by the Senate’s refusal to pass workplace relations-legislation, and
  • the Royal Commission into Trade Union Governance and Corruption had just confirmed every small business owner’s worst fears about union thievery and thuggery, and
  • you were also busy telling us how much you cared about small business!

4. The relevant Minister basically was basically missing in action for the entire campaign. We should have known then your heart wasn’t really in it. You watched on in silence as scandal after scandal engulfed the Fair Work Commission. It was your job to speak up in defence of common decency when the Commission itself couldn’t or wouldn’t. You didn’t.

5. You failed to appoint small business owners to the Commission. When Labor is in power, they go to town appointing union officials, but when you were in power you just forgot that small business owners know more about the realities of workplace relations than you ever will.

So, wonder no more, your fate was sealed the day you won the last election and spent every week thereafter focussed on further expanding unaffordable middle class welfare, doubling our national debt, and pouring yet more money into the black hole that is our country’s 18 overlapping state, territory and commonwealth departments responsible for health and education.

We know Labor won’t be any better for small business, we just decided they couldn’t possibly be any worse. And, besides, at least they didn’t cynically pretend to be on our side just to get our vote.

No, Coalition, Australia’s small business owners won’t miss you.

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Two takeaways from the Pizza Hut pay saga

Wednesday, February 01, 2017

By David Bates

Ordered a pizza lately? If you have, there’s a good chance the driver who cheerily delivered it to your door was being underpaid by their employer.

What percentage of the Pizza Hut franchises investigated by the Fair Work Ombudsman (FWO) do you think were found to be fully-compliant with Australia’s hopelessly complex, arcane and inflexible employment laws?

80%? 50%? 30%?

No, just 8%.

That’s right, of all the Pizza Hut franchises audited by the FWO, 92% failed to demonstrate they were fully-compliant with the Fair Work Act and the applicable Modern Award.

Examples of common breaches included incorrectly classifying employees, failing to issue fully-compliant pay slips, failing to maintain correct time and wages records and, in some cases, incorrectly classifying employees as ‘independent contractors’ and paying drivers on a ‘per delivery’ basis.

The person in charge of the FWO, Natalie James (who issues countless press releases and apparently complains about being held accountable for the actions of the agency she leads), jumped on the telly to tell us she hopes Pizza Hut will now “step up, take responsibility, put in place step to make sure that their workers are paid correctly”.

So here’s two things every employer can take away (pardon the pun) from this latest (remember 7-11?) underpayment fiasco:

Takeaway #1: Our employment laws are not fit for the 21st century, and even employers who try to do the right thing find it virtually impossible to make heads or tails of the Fair Work Act and Modern Awards.

Here’s the proof: Pizza Hut franchisees apparently all had access to expert HR advice as part of their franchise agreement. However, that advice didn’t include guidance explaining which industrial instruments apply to specific employees within specific outlets. Put another way, small business owners now need to have a law degree and a Masters in Employment Law in order to understand their obligations.

Takeaway #2: the FWO is a disaster. Here’s the proof:

a) the FWO is, by law, responsible for educating Australian employers and employees about Fair Work practices, rights and obligations

b) the Fair Work Act has now been in operation for over six years.

c) 92% of Pizza Hut franchisees investigated by the FWO didn’t appear to have been educated about Fair Work practices, rights and obligations.

If I did my job as badly as Natalie James’ agency does theirs, I’d be asked to explain why I shouldn’t be dismissed for serious misconduct.

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Why I'm with VP Watson

Wednesday, January 25, 2017

By David Bates

When I appeared on the Switzer program last week and once again raised serious concerns about the operation of Australia’s national employment relations tribunal, the Fair Work Commission, I could not have imagined I’d be proven so right so soon.

But then, just a few days after my segment went to air, Fair Work Commission Vice President Graeme Watson resigned in disgust from his (very) well-paid and highly influential position, which he was entitled to hold until the age of 65.

In his blistering letter of resignation, VP Watson confirmed beyond any doubt that each and every one of the criticisms we have levelled at the Commission in recent years has been justified:

  • He said the Commission cannot be described as ‘balanced’. We’ve been saying that for years.
  • He noted businesses increasingly regard the Commission as ‘partisan, dysfunctional and divided’. We sure do!
  • He wrote that the current Fair Work system does not foster ‘cooperation or productivity’. Couldn’t have said it better myself.
  • He confirmed the Commission’s current modus operandi is damaging business and our national economy. It sure is.
  • And in remarks made some time ago, he lamented the narrow trade union background of many of those appointed until retirement to the Commission by various governments of the day. We have been red-flagging the appalling lack of diversity in Commission appointments for years.

Let there be no doubt: the very public resignation of the fourth most senior-ranked Commissioner – and the publication of his scathing resignation letter – is a major slap in the face for the Commission.

And don’t forget, this is the same tribunal which is still trying (unsuccessfully) to rebuild its reputation after the resignation of another former Vice President, Michael Lawler.

You may remember him – he is the partner of the now-convicted former head of the Health Services Union, Kathy Jackson, who took almost a year off on fully-paid (by the tax payer) sick leave on his salary of over $400,000 per year and decided that would be a good time to appear on the ABC’s Four Corners program.

You really should download the program if you haven’t already -  VP Lawler describes himself as ‘c**t struck’, and then goes on to demonstrate how he secretly recorded his telephone conversations with his boss, Fair Work Commission President, Iain Ross. Keep in mind Michael Lawler was still an appointed Vice President of the Fair Work Commission when that segment went to air.

You really can’t make this stuff up. And perhaps that’s why when I raise concerns about the Commission I’m often told things can’t really be as bad as I claim.

Thanks to VP Watson’s letter of resignation, you now know for sure they are … and then some.

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Forget pollie perks … what about the public service?

Wednesday, January 18, 2017

By David Bates

Peter’s article about the perks enjoyed by our politicians was (as usual) bang on the money. While I wish Sussan Ley hadn’t charged me for her new year’s eve cocktails with Sarina Russo, there are bigger fish to fry.

Take the public sector for example.

While small business owners are working every hour God sends, paying payroll tax and income tax, making compulsory superannuation contributions and generally keeping the economy ticking along for the benefit of every Australian, some public servants appear to be enjoying the good life at our collective expense.

Take the head Statistician of the Australian Bureau of Statistics (ABS), David Kalisch, for example. He was the fellow ultimately responsible for last year’s (entirely predictable) Census fiasco. If he worked for a small business and performed that badly, he’d probably have been sacked without notice.

But luckily for David, he’s employed by the Australian Public Service, on a total annual remuneration package of ... (insert drumroll) … just over $700,000. Yes, you read that correctly - $700,000. In case you’re wondering, the Prime Minister currently receives just over $500,000.

Go figure.

Or how about the current head of the Fair Work Ombudsman, Natalie James, who holds a tax-payer funded statutory appointment which expires next year. While the agency she leads publishes press release after press release confirming they have comprehensively failed their remit to explain Australia’s workplace relations laws to employers, she’s enjoying a total annual remuneration package of just over $400,000.

How many small business owners do you know that make that kind of money? Her generous package at least helps explain why she’s so out of touch with those who pay the taxes which pay her salary.

And while we’re on the subject of our tax dollars being wasted, let’s not forget the elephant in the room: we are incredibly over-governed. I never thought I’d say this, but Bob Hawke is 100% right: we need to abolish state governments.

Why on earth do taxpayers have to fund nine different education departments and nine different health departments, for example? If small businesses operated with as much duplication and waste as our state and federal governments, they’d be shuttered-up and closed-down within a matter of days.

So, Peter is right, let’s not waste time worrying about who paid for Sussan Ley’s hotel. Let’s instead start asking why our under-performing public servants and statutory office-holders are paid so much, and why we continue to fund obviously unnecessarily duplication in our state and territory governments.

After all, at least we can vote out the pollies.

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