KPMG has been excluded from the government’s industrial relations consultations after publishing a discussion paper that was deemed a leak from the secret talks.
Earlier this week KPMG, which has a technical advisory role in two of the five working groups, published a paper proposing wide-ranging changes including Fair Work Commission powers to allow employers to cut hours and changes to the better off overall test that could water down protections on pay and conditions.
KPMG had been invited by the Australian Council of Trade Unions and Australian Chamber of Commerce and Industry to participate in meetings on compliance on Thursday and greenfields agreements on Friday.
But Thursday’s working group started with a warning that KPMG appeared to have breached the confidentiality of discussions and a consultation among participants favoured excluding it.
Guardian Australia understands KPMG was excluded from the two sessions it was due to attend this week as a result.
Scott Gartrell, KPMG’s workplace relations advisory partner, was due to speak at Friday’s session but was dropped from an agenda circulated on Thursday afternoon.
Gartrell told Guardian Australia that KPMG’s engagement with the working groups “is subject to confidentiality” and declined to answer further questions.
The KPMG paper argues that although the proportion of workplace relations matters that end up in courts or tribunals is “comparatively small” it is an increasing cost for business due to an “intricate web of rules and regulations”.
The paper says that given only a handful of awards have been changed to respond to the Covid-19 pandemic, the government should consider expanding FWC’s powers to vary awards to help businesses “survive the pandemic and its aftermath”.
KPMG proposes that FWC could gain powers to make it “easier to change rosters, hours and duties” – powers that currently only exist for firms accessing jobkeeper wage subsidies.
KPMG suggests streamlining and simplifying awards, including with annualised salaries for workers earning “in excess of the award safety net” to pay for all their award conditions.
KPMG argues that awards in effect limit what workers and employers can agree in enterprise agreements – because they cannot agree on “flexibilities” that lower conditions or the deal will fail the better off overall test.
The better off overall test “increasingly focuses on outliers, requiring [enterprise agreements] to be better off than every award provision, rather than reflecting a bargain where the parties had agreed on a balanced approach”, it said.
“Increasingly the major bargaining item is determining the rate at which wages/salaries will increase.”
KPMG also called for the onus to be reversed so there is a disposition to approve workplace pay deals – including overlooking procedural defects – unless an objection is raised such as unconscionable or inappropriate behaviour by the employer.
KPMG suggests a number of solutions to the problem of so-called “double dipping” when casuals receive a loading on their pay but are later deemed by a court to be entitled to rights of a permanent worker.
It suggests the federal government could intervene in a pending high court case on the matter, legislate a definition of casual employee, create a wider right for casual conversion to permanent work or “offset casual loadings to address [the] financial impact”.
Under the latter proposal, employers would be able to deduct the casual loading already paid from future entitlements to avoid double-dipping.
On compliance and enforcement, KPMG proposes that employers should be able to receive “binding rulings” that they have interpreted pay rules correctly, so that ambiguous provisions cannot result in backpay claims.
It also proposes a compliance regime that offers employers more leeway for errors calculating pay and conditions where they make voluntary disclosures and agree to rectify errors.
On greenfields agreements, the KPMG paper proposed new projects should be governed by agreements that last the life of the project to prevent the “risk of cost blow outs and delays”.
Parties would have just three months to negotiate a pay deal – rather than six – under a second proposal.
Although the government is seeking common ground with unions, it has reserved the right to push ahead with reforms if it is not achieved by the time the five working groups conclude in September.
With the exception of the KPMG paper, parties have been tight-lipped on talks, although industrial relations minister, Christian Porter, has already publicly argued for project-life agreements and award simplification.
The Australian Council of Trade Unions president, Michele O’Neil, has said unions’ objectives are to ensure that “no worker is worse off as a result of any proposals” and reforms help achieve job security for working people in Australia.