MGMT3724 Lecture Week 5

SHRM and the regulatory

environment: complex, disparate and
shiifting

Content
What is regulation and different types
IR regulation, context and change
Gender/discrimination regulation,
context and change
OHS regulation, context & change
Workers compensation regulation,
context & change
Some conclusions

What is regulation?
Regulation refers to the societal rules of the State
governing human and organisational behaviour (ie
laws) and the processes for enforcing or implementing
them
(a definition) any process or set of processes by which
norms are established, the behaviour of those subject
to the norms monitored or fed back into the regime,
and for which there are mechanisms for holding the
behaviour of regulated actors within the acceptable
limits of the regime (whether by enforcement action
or by some other mechanism (Scott, 2001)

What is regulation?
to influence behaviour, the state has available to it a
number of regulatory techniques beyond the
conventional 'command and control' style of
regulation, in which formal rules are created,
monitored and enforced by the state through orders
and sanctions(Howe & Landau, 2007) see
discussion of light touch regulation below.

What is regulation?
Governance refers to internal controls within
organisations. Regulation has also been used to refer to
intra-organisational controls but not in this course. State
regulation sets some boundaries for internal controls
In democracies statutes are enacted by elected
legislatures. In totalitarian regimes the process is more
opaque.
In countries with UK historical connection in addition to
statutes there is the common law (derived from AngloSaxon customary laws) which incorporates principle
adjudicated by the courts (eg negligence, torts, breach
of contract)

Role and types of law

Laws set a framework governing risk, controlling the
behaviour of individuals and organisations
Generally proscribe unacceptable practices/behaviour
with penalties for those who offend
Most laws specific to country of operation but some do
impose wider requirements & also global agreements
In practice organisations and their activities governed by
an array of laws, including
Common law
Environmental, public safety, workplace safety, transport laws
Commercial (including trade agreements), corporate, consumer
and taxation laws
Criminal laws

Employment and Industrial

Relations

Different types of law and

legal standards

Criminal and civil laws

Absolute v relative liability (reasonably practicable)
Statutes and subordinate legislation (regulations)
Initially statute laws predominantly command & control
(set penalties for specified offences prescriptive
standards plus licensing safety critical individuals like
shipmasters)
Licensing person or processes (eg SCR) is proactive form of
regulation because rather than detecting breaches must
meet standard before can operate (onus on operator)
Common law based on recovering damages for failing to
abide by duties

Oversight and enforcement

agencies
Courts and the judiciary
Police, customs, border control/anti-terrorism
Government accountability and anti corruption agencies
(eg GAO & OIG in USA, ICAC in NSW)
Inspectorates (eg EPA/environment, food safety, transport
safety, OHS, labour standards)
Investigators (eg ATSB) & enforcement taskforces (eg ATO)
Corporate watchdogs (eg ACCC)
Private auditors and others (eg unions, community groups)
Note: some standard-setting/oversight bodies able to
impose penalties for non-compliance (eg WTO) but others
cannot (ILO)

Different types of law and

legal standards
Criminal and civil laws (imprisonment v other penalties)
Absolute v relative liability (reasonably practicable)
Statutes and subordinate legislation (regulations)
Initially statute laws predominantly command & control (set
penalties for specified offences prescriptive standards)
Common law based on recovering damages for failing to
abide by duties
Shift to risk and systems-based regulation (internal control)
relying on

Performance standards
Process standards
General Duty provisions, codes (voluntary/mandatory),
regulations and guidance material

Key IR law changes from 1980s:

Australia
1901-1980 IR regime based on
Compulsory arbitration but can negotiate, collective regulation
encouraged (awards & agreements) including preference provisions for
union members. Compulsory in sense employer couldnt prevent
determination (if they refused to bargain tribunal could still make
ruling)
Extensive array of minimum conditions covering over 80% of workers
that were legally enforceable
Prominent role played by employer associations and unions, most
awards industry/occupation based (not enterprise or workplace though
these existed)
Unions had fairy unfettered access to workplaces of workers they
covered (most unions occupationally based) and did a lot of
enforcement activity in problematic industries like construction, farming
and retailing.
Union density high still over 50% in 1976.

Key IR law changes from 1980s: Australia

Post 1980 changes:
Minimum labour standards wound back to limited safety net (from 60+
to 18 then 10 exclusions include rest breaks, penalty rates, OHS)
Non-union & union contracts on same footing (1996-2007 individual
contracts known as AWAs promoted but this repealed)
Hundreds of awards/agreements now 1000s of agreements (not public
documents)
Inspectorate replaced by new body to investigate breaches (now Fair
Work Ombudsman)
More difficult to identify/monitor/address exploitation/risk exposure of
short-term workers, esp temporary (work visa, backpackers, students)
& illegal foreign workers (already serious issue)
Role for employer organisations and unions diminished
Role of federal tribunal (Fair Work Australia) diminished & new fair
pay body (headed by finance professor) to set minimum pay

Key IR law changes from 1980s:

Australia
Post 1980 changes continued:
Scope for union bargaining, legitimate industrial action and entry to
workplace of officials reduced (must give notice, have access rights and
increased penalties for breaches). Right of entry provisions critical to
effective protection.
Limited scope/period for legal industrial action (prohibited industrial action)
Scope for reinstatement for unfair dismissal circumscribed. Increasing
scope for legitimate dismissal making it harder to prove whistle-blower or
activist has been victimised
Move to entirely federal system. One effect was to remove protections
enshrined in some state IR laws eg NSW Secure Employment Test case
decision
Establishment of special tribunal for construction (ABCC) and contractors in
road transport (RSRT) both since repealed (but plans to re-establish
ABCC)
Union density declined drastically (now below 20% & concentrated in
public sector same pattern as USA)

Some implications of these changes

Combined with growth of flexible work arrangements, outsourcing
& more aggressive management degree of collective
determination of employment conditions declined
Union avoidance more common, unions fighting more defensive
actions & less scope for collaborative SHRM
Trend to greater gender equity in pay stalled (centralised systems
better)
Growing evidence of systemic non-payment of minimum
conditions, especially cases involving short-term foreign workers,
eg seven eleven

http://www.abc.net.au/news/2016-05-16/7-eleven-hunter-cash-back-scheme-still-alive-un
ion-says/7415940

http://www.abc.net.au/news/2016-05-28/fels-still-sceptical-about-7-eleven-in-house-pay
back-process/7455896
http://www.smh.com.au/business/workplace-relations/fair-work-ombudsman-calls-on-7elev
en-to-admit-exploitation-complicity-20160406-go077o.html

http://711classaction.com/info

(there are numerous other cases see https://www.fairwork.gov.au/about-

Similar global trends in IR context

Overall decline in union density in rich countries while union growth
in poor/middle income & emerging countries weak or non existent
(eg independent unions illegal in China & suppressed to greater or
lesser degree in others like Thailand)
Changes to IR laws reducing job security, increasing flexibility re
contracts and working hours and making it more difficult for unions
common in both rich & poor countries.
Low minimum wage laws entail hidden & social costs including
poverty, poor health, impacts on families & hidden govt subsidies (eg
US Walmart)
Negotiating away conditions has become more common especially in
the context of widespread downsizing, outsourcing, privatisation etc.
Note: other laws affecting employment include those governing long
service leave and superannuation as well EEO/Anti-discrimination
(see below)

Equal Employment
Opportunity and
Discrimination at Work

Equal employment opportunity and

anti discrimination legislation:
Australia

Equal employment opportunity )EEO) and discriminatory practices

re employment (amongst other things) governed by federal laws on
racial, sex & disability discrimination, EEO (for women in workplace).
EEO is not affirmative action (eg setting quotas) but equal merit &
applies unless employer can demonstrate that characteristic is
actual job requirement (ie necessary to perform task) like church
minister having particular religious beliefs.
Federal anti discrimination laws Cover race, colour, sex, sexual
preference, age, physical & mental disability, religion, marital
status, family responsibilities, pregnancy, political opinion, national
extraction/social origin, physical disfigurement, harassment,
presence of disease causing organisms, union membership (or not)
Some states also have laws covering physical appearance, industrial
activity, sexual preference/gender identity, breastfeeding, career
status & criminal record.

Equal employment opportunity and

anti discrimination legislation: Some
Issues

Similar array of laws found in North America, EU, NZ (may still be

some important differences) but major differences common in Africa,
Asia & the Middle East.
Discrimination can be direct (eg men/only/no women need apply) or
indirect (eg minimum height requirement is 177cm and minimum
weight is 83kg or hours or travel requirements that will exclude
women with children). Some job requirements and selection regimes
can also discriminate against women (career breaks, childcare needs)
or older workers (physical requirements, unnecessary educational
qualifications or tests) Indirect discrimination far more common today.
Can be achieved in subtle ways (eg all male selection committee or
boards composed of only accountants/finance people and engineers).
And glass ceiling too. On the other hand, mentoring is common
career advancement device amongst men but not uncommon for
successful women to provide no mentoring or other supports to those
below (I made it why bother, potential competitors, scarcity value)

Equal employment opportunity and

anti discrimination legislation: Some
Issues
Some areas are getting increased attention like bullying and
harassment (though this is also largely covered by OHS laws)
and more complaints related to particular groups like LGBTI
Unlike IR and OHS laws, EEO and Discrimination laws are both
predominantly individualised (eg unions play no role) and
passive (no independent inspectorate, rather rely on
complaints being lodged with state/federal tribunal or
commission) and usually seek to mediate remedy (fines and
penalties tend to be low or seldom enforced)

Equal employment opportunity and

anti discrimination legislation: Some
Issues
Limitations of complaint-based regimes regimes
Reactive not proactive though well publicised cases can
have flow-on effects especially where highlight reputational
damage to organisations
Require knowledge of laws
Require psychological and economic resources to lodge and
purse of often lengthy complaint process (weight falls on
individuals not organisation)
Favours better educated and higher income groups
Levels of activity/complaints can vary substantial amongst
different groups (eg LGBTI, aboriginal, women, ethnic
minorities) and may not reflect extent of the problem overall
or the occupations where affected people are most at risk
Fear of victimisation/retribution by this or future employers

Equal employment opportunity and

anti discrimination legislation: Some
Issues

Limitations of complaint-based regimes continued

Fear of alienating fellow workers as a complainer

In cases of dismissal evidence is often mixed (ie person
may have performance issues or these were
manufactured) & other workers reluctant to act as
witnesses
Even more problematic where worker has language and
cultural issues (again complexities re disputes over
qualifications given different standards and corruption in
certification)
Workers can be driven out through assignment to
unpleasant tasks, increased workload or subtle harassment
(eg emails on weekends, meetings etc).

Equal employment opportunity, antidiscrimination laws & gender

Women expected to take on bulk of childcare
Less hours available to engage in paid work
Part-time work 72.4% of all part-time jobs done by
women
Effect on womens ability to earn in the same way as men
can
Because women paid less, economic sense for women
to do childcare
Even single women affected by stereotypes e.g. asked
whether they will have babies
Why doesnt long service leave have the same
connotations?
Despite improvements in attitudes, basis for oppression
still the same
Legislation, workplace relations have dramatic effects on
womens place in society
22

Situation today is it
getting better?
Anne Summers the end of equality?
Proportion of women in full-time jobs
has not increased since mid-1970s
More women work part-time, greater
than any other industrialised country
65 per cent of part-time jobs done by
women
32% of women employed as casuals
Highest rate of gender segregation in
the workforce clerical, retail,
education and health
Equal pay does not exist womens
total average weekly earnings are 66
per cent of mens and gap is widening
Higher you go, bigger the gap
Bottom 5% - gap 10%
Top 5 % - as much as 20%

Related to individual
bargaining
Overseas evidence as collective
bargaining
decreases, gap at
the bottom will widen
23

Social costs
Women have less superannuation for old age
Greater numbers of women living in poverty than ever before
Increased number of women on welfare, sole parent families
Domestic violence costs $1.8 billion per year (Access Economics,
The Cost of Domestic Violence to the Australian Economy, Oct. 2004)
Short-fall of 1 million child care places, care expensive,
grandmothers picking up the slack

Only 40% of working mothers have access to any paid maternity leave
Majority of these have higher paying jobs.
65% of women in the $50-69,000 bracket have access to paid
maternity leave
30% of those in the $20-30,000 group have similar benefits
Figures take account of all maternity leave
Some agreements and contracts have two weeks paid leave

2001 - OECD survey revealed that Australia had the lowest

employment rate of lone parents and mothers with children under
six
No paid maternity leave means few paths back to workforce after
birth.
24

Tough at the top

Less than 10 per cent of senior
executives are women
25 per cent of women will never
have children
Margaret Peters research some
women lie about having children
Dont take up family-friendly
policies

No one in this
organisation knows that I
have children. They
dont even know that I
am married. Its not an
aspect of my life that I
care to share with
anyone because it
immediately places me
in a vulnerable position.

One senior executive reported,

every time I come back [from
Progress
women
have
maternity stalls
leave]when
my desk
is
children
gone

Have to ensure children dont

interfere with work
Some sectors, HRM, Banking,
Finance and Marketing, have
expanded opportunities, most not

Outsourcing of domestic
responsibilities?
See sexist and racist connotations in
reader home care work
25

Occupational Health &

Safety

Main Features of RobensStyle Legislation

Robens Report (UK 1972) led to major refashioning of OHS law in
Australia & elsewhere (ILO convention 155). Similar changes in
Scandinavia (USA too introduced new laws in 1970)
Rationalisation of laws, standards, inspectoral agencies (Enabling
Acts supported by regulations, guidelines, codes of practice
Introduction of general duty provisions (prior laws mainly specification
standards) supported by a single OHS regulation, using mainly process
and performance standards (based on national standards)
Opportunity for employers, employees & unions to participate
(tripartite bodies, industry committees, H&S representatives, workplace
OHS committees, anti-victimisation provisions)
Greater rights to information for employees (& their representatives)
Improved enforcement: improvement and prohibition notices, heavier
penalties
In Australia unlike IR OHS and workers compensation remain state &
territory responsibility but following National Review in 2009 model
OHS law developed which most states & territories have now adopted

Key features of Post-Robens OHS

laws: general duty provisions
General duty provisions require PCBU (see below) to take systematic
and proactive approach to managing OHS and safeguard wellbeing of
workers as far as reasonably practicable - includes
training/induction, supervision, safe plant/equipment and safe systems of
work
Health & safety including physical and psychosocial hazards

Covers array of parties (designers, suppliers, employers,

manufacturers, self-employed/contractors, employees) & includes duties
to non-workers (eg public, volunteers)
person who conducts a business or an undertaking (PCBU) to ensure
the OHS of each of the employers workers and any other persons in
the conduct of the employers business or undertaking.
Wide definition of work and workers

Worker participation
mechanisms under OHS
legislation
Tripartite standard/policy bodies at

jurisdictional or industry (NSW & Qld) level

Workplace health and safety committees
Health and safety Representatives (note:
unions play critical support role for HSRs)
Union officials have right to enter workplace
if suspect OHS breach (National model OHS
Act)
Union right to prosecute (was restricted to
NSW and not in national model OHS law)

Inspection and
enforcement
Informal sanctions:
persuasion, advice, warnings and
threats. Formal sanctions include:

o improvement notices (hazard be remedied within a

specified time)
o prohibition notices (requiring work cease until hazard
removed)
o infringement notices (on-the-spot fines)*
o Enforceable undertakings : empower the inspectorate to
accept a written undertaking about remedial measures for a
detected contravention of the OHS Act, rather than
proceeding with the prosecution. If the undertaking is
breached, a court may make appropriate orders.*
o Prosecution (can also include adverse publicity requirement*
)
* Do not apply in all jurisdictions

Impact of Reformed OHS post

Robens-Style Legislation
Positive
Broader array of OHS standards apply to different worksettings (codes, regs articulate)
More workplaces with OHS policies & committees
Appointment of large number of H&S representatives
Greater management focus on OHS
Use of improvement & prohibition notices

Negative
Problematic relationship between performance standards
and prescriptive standards
Participatory mechanisms effectiveness dependent on
union support (declining)
Still limited enforcement
Self-regulation or co-regulation may mean de-regulation

Challenges for SHRM

While growing consistency of OHS laws in Australia,
and parallels with other countries requirements can
vary considerably globally
This applies not only to general OHS laws but more
specialised laws dealing with transport, mining, oil &
gas
Can have particular relevance to decisions re
restructuring, outsourcing and other forms of work
reorganisation (eg use of temporary agency firms
where both host/client and agency share legal
responsibilities)

Workers compensation &

rehabilitation

The Workers Compensation

Legislative Model
Introduced early 20th century, key principles
(can still sue at common law for damages but
no double dipping)
no fault compensation
broad coverage
specified compensation entitlements
mandatory coverage & collective
employer liability
right of appeal

Major Policy Goals

providing medical treatment and income
security to injured workers (&
dependents)
ensuring employers meet the costs of
injury & disease arising in their
workplaces
encouraging preventative action by
employers
encouraging return to work/rehabilitation
Note: pursuing one goal may adversely
affect capacity to meet another so
policy pursuit has proved a balancing act

Reforms: 1980s
trend to government monopoly (follow Qld)
incentives for prevention
bonus/penalty premium systems
closer integration of prevention/ compensation/rehabilitation
agencies

improvements in weekly payments, extension of timelimits, & removal of lump sums in lieu
balanced by limits on access to common law actions

improved administration, including

attempts to remove discriminatory practices
enhanced rehabilitation
Improved infrastructure (staff & resources, require plans)

Reforms of 1990s
containment of costs & reduced entitlements
lower payments, shorter periods
abolition of right to sue at
common law
restriction of stress, journey claims
changes in claims handling procedures
e.g. stronger provisions for
dealing with fraud, privatisation of
administration
wider use of private & self-insurers

Ongoing challenges
lack of national coordination

who is covered, what is covered, entitlements

inadequate payments and entitlements

Weekly pay (casuals), lump sum & social security drift

inadequate coverage

Especially re disease, psychological impairment

Self-employed/contractors, volunteers

Limited encouragement for return to work/rehab

Job security/obligations (labour hire, contractors)

failure to enhance injury prevention

But note dangers re compo data & conflicts of interest

administrative, equity and structural problems

foreign workers, women, casual/labour hire workers

while similar workers compensation laws operate in some

countries there are also significant differences in terms of
coverage & content especially with some countries/regions

Conclusions

Conclusions
Regulation is complex and shifting
Array of different & overlapping laws cover work
Some of these laws based on different approaches
and level of implementation/enforcement also varies
Context where laws apply differ not only between
countries but also for different categories of workers
(employee, self-employed, visa status etc)
Can pertain to an array of HR practices ie
recruitment, selection, training/supervision,
reward/remuneration, exposure to risk/workers
compensation, promotion and discipline
Terrain of expectations/complaints also shifting over
time and not uniformly at global level