Melbourne Law School - Theses

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    Friend or foe?: The regulatory enrolment of non-state actors in the enforcement of minimum employment standards in Australia
    HARDY, TESS ( 2014)
    This thesis empirically examines the enrolment of non-state actors in the enforcement of minimum employment standards in Australia. While policymakers and academics have been increasingly attracted to decentred techniques and collaborative modes of regulation, there have been very few systematic evaluations of the circumstances in which these mechanisms will actually ‘work’. Responding to these issues, this study centres on why and how the federal labour inspectorate in Australia – now known as the Fair Work Ombudsman (FWO) – has sought to enrol various non-state actors in a bid to improve employer compliance with minimum employment standards. It also considers the benefits, limitations and risks of regulatory enrolment in the enforcement of employment standards regulation in both theory and practice. The empirical research in this thesis is principally based on a collective case study of two leading enrolment initiatives of the FWO. The first case study focuses on the Horticulture Industry Shared Compliance Program (HISC Program) – a pioneering program which involved collaboration between the FWO and employer association and union representatives. The second case considers the implementation of the National Franchise Program (NFP) – a recent initiative which involved the FWO working with head franchisors in order to identify and rectify issues of employer non-compliance throughout the franchise network. Each case study represents a novel and distinct example of regulatory enrolment in terms of the industry context, the actors enrolled and the scope and scale of enrolment. The diversity of the enrolment experiments ensures that this study goes beyond the limited existing research by capturing a range of different conditions and offering new insights into the operation of decentred regulation in sectors which are particularly challenging from an enforcement perspective. The enrolment analysis of each case widens our view of who may wield regulatory power and enhances our knowledge and awareness as to whether, to what extent, and in what ways non-state actors have contributed, and may yet contribute, to the regulation and enforcement of minimum employment standards in Australia. The picture emerging from the in-depth case studies is a complex one. The case studies find that by enrolling non-state actors in compliance and enforcement processes, the FWO can expand its regulatory capacity and extend its regulatory reach. For example, the case studies reveal that non-state actors, such as employer associations, unions and lead firms, often possess key regulatory resources – such as information, strategic position, authority and legitimacy – which can assist the FWO to understand the nature of the regulatory problem. Further, these resources can be, and have been, used by the FWO to modify employer behaviour by triggering key compliance motivations and leveraging different sources of influence. However, the case studies also show that, at times, these resources have not been fully exploited by the FWO. Further, some alternative actors with useful regulatory resources at their disposal have been overlooked. At times, this can be attributed to a failure by the FWO to properly link the scope and purpose of the enrolment with the scope and nature of the compliance problem it has sought to address. In other instances, the enrolment has been compromised by the FWO’s failure to control key conditions – such as participatory incentives and conflicts of interest. These issues are exacerbated, in part, by a lack of formalisation and an emphasis on cooperation and collaboration over detection and enforcement. Ultimately, these limitations and risks mean that regulatory resources of non-state actors have not necessarily been deployed in a way that furthered the regulatory objective or resolved the underlying regulatory issues. The empirical research in this thesis also finds that the theory of regulatory enrolment, at least in the context of employment standards regulation, has some critical vulnerabilities and structural limitations. First, regulatory enrolment theory does not easily accommodate situations where key actors are absent, weak, disorganised or apathetic. Proceeding with regulatory enrolment in these circumstances raises the risk of creating the illusion of collaboration when the process operates more like co-option. Second, the case studies demonstrate that engaging in deliberative standard-setting and consensus-based decision-making – a key feature of many theories of decentred regulation – is problematic in circumstances where the meaning and interpretation of regulation is unsettled and where the outcome lacks authority and finality. The third insight relates to the role of the state. It is argued that the state needs to remain active and engaged in the enrolment process and must be very careful in adopting a position of independence and neutrality, particularly where this is adopted against a background of historical adversarialism and/or power asymmetries. Although this thesis does not resolve all the issues raised by regulatory enrolment, it successfully prompts questions and ideas about how to enhance the benefits, minimise the limitations and reduce the risks of an enrolment strategy in the future. To this extent, it provides a useful starting point for policymakers and scholars who are similarly grappling with the most effective way to overcome enforcement problems in the employment sphere and beyond.
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    A changing of the guard: a critique of the federal enforcement agency since work choices
    HARDY, TESS ( 2009)
    “In the past year, we moved from being a traditional time and wages inspectorate, and repositioned Workplace Inspectors as fearless, independent, effective protectors of workplace rights, not afraid to use the full range of powers available to them, including using the courts for penalties or deterrence.”1 Soon after the Howard Government announced its industrial relations policy in 2005, concerns were raised that the ‘deregulation’2 of workplace relations brought about by the Workplace Relations Amendment (Work Choices) Act 2005 (Cth) (Work Choices)3 would lead to exploitation of employees.4 In an attempt to silence the unions and reassure the public in respect of the new laws, the federal government raised the profile of the federal enforcement agency. Amongst other things, it changed the agency’s institutional structure, boosted its funding and strengthened its prosecution policy. The then Minister for Employment and Workplace Relations commented at the time that the revitalized inspectorate establishers ‘the most significant industrial compliance and enforcement regime ever introduced by an Australian government’.5 In addition to the changed emphasis on enforcement, as a result of Work Choices, State regulatory enforcement bodies were sidelined, and the powers of the Australian Industrial Relations commission (AIRC) significantly curbed.6 There was also a further fall in unionization.7 Together, this has meant that, in practice, the federal inspectorate is now the main enforcement body for a significant majority of employers and employees in all States and Territories. While State enforcement agencies are still in operation and the State industrial tribunals continue to largely have the same powers to conciliate and arbitrate, at least 75% of the workforce now fall within the federal system of regulation.8 At the same time, the range of investigation and prosecution responsibilities significantly broadened under Work Choices. The inspectorate was no longer solely concerned with the enforcement of minimum labour standards. Rather, it was charged with the responsibility of ensuring that the burgeoning regime of civil remedy provisions under the Workplace Relations Act 1996 (Cth) (WR Act), the Workplace Relations Regulations 2006 (Cth) (WR Regulations) and the Independent Contractors Act 2006 (Cth), were complied with and enforced. While the Pre-Reform Act had some civil penalty provisions, their number substantially increased under Work Choices, in no small part due to the prescriptive and complex amendments brought about by Work Choices. The increased funding and subsequent rise in prosecutions, combined with the heated debate surrounding Work Choices, a wave of advertising, 9 and the controversial ‘use of the federal enforcement agency to “fire fight” media reports of exploitation’,10 also raised the profile of the federal inspectorate in the post-Work Choices period. In comparison, the ‘traditional time and wages inspectorate’, as it is described by the Workplace Ombudsman in the opening quote to this thesis, was largely perceived as being ineffective and maintained a relatively low profile. In the earlier years of operation, resources were so scarce and penalties so low that investigation and prosecution of miscreant employers was perceived as having little deterrent effect. While legislative deficiencies were slowly rectified and penalties significantly increased, the weak persuasive compliance approach – which dominated enforcement strategies in the pre-Work Choices era – was seen to implicitly condone employer non-compliance.11 It is clear from this summary that the role of the federal enforcement agency has changed since Work Choices. It is not entirely apparent, however, whether inspectors have been positively ‘repositioned’ to the extent suggested by the Workplace Ombudsman in the opening quote – this thesis will explore this question in the context of the shifting legislative and political landscape since Work Choices. (From Introduction)