Employers and increased regulation

Introduction

Over the last couple of decades, employers have used their lobbying power (influencing government policy) to achieve less regulation of business. The business world feels that too much regulation and too many rules have a negative effect on business growth and profits. Businesses argue that regulation, therefore, ultimately stops jobs growth. Some businesses have lobbied successfully to reduce regulation in employer associations, like the Business Council of Australia (BCA) and the Australian Industry Group (AIG). Employer associations (the 'business lobby') act to pursue the interests of business in a similar way to how unions act to pursue the interests of workers.) See image 1.

What do employer associations do?

Employer associations promote their employer members' interests, which include a reduction in government regulation so the government has less control over what businesses do, formulating business policies and lobbying or influencing government policies affecting businesses, like employment laws and taxation. Employer associations have traditionally represented their employer members in tribunal negotiations with unions, concerning award and enterprise arrangements for wages and working conditions. Employer associations also perform a number of associated services for employer members, like devising employment contracts, providing legal advice, organising employee training programs and advising on occupational health and safety. See image 2.

The Australian Industry Group (AIG) promotes the interests of employers in the industries of metal trades and manufacturing. An important aim of the AIG is to ensure that the manufacturing industry can continue to produce high-quality, and low-cost goods, like cars, in a competitive global economy in which manufactured goods from countries like China produce good quality, affordable items that make Australian exports less competitive. The AIG represents the interests of over 11 000 businesses across Australia, which makes this employer association highly influential with governments. See animation 1.

Businesses and less regulated employment laws

As discussed, employers tend to favour less regulation, fewer rules and red tape (bureaucratic procedure) from government which, it is argued, can restrict the way businesses can operate. One example is the deregulatory effect of recent changes to federal employment law/industrial relations policy, with the Workplace Relations Act 1996 (Cth), and the Relations Amendment (Work Choices) Act 2005 (Cth). In general, employers have benefited from legislation allowing them to negotiate individual agreements/contracts with individual employees. This allows them to have greater control over the high costs of wages and the costs of hiring and managing staff, while complying with statutory minimum requirements for hiring employees. It has also given businesses and employers more bargaining power in the employment relationship, compared with individual employees or their representatives (usually unions).