The Howard Coalition Government, elected to office in 1996, placed a high priority on changing the federal industrial system and, in particular, supporting a more direct relationship between employer and employee through individual rather than collective bargaining.
Upon receiving Royal Assent, the Workplace Relations and Other Legislation Amendment Act 1996 (WROLA Act) changed the short title of the Industrial Relations Act 1988 to the Workplace Relations Act 1996.
Provisions of the new Act included:
- a more confined arbitral role for the Australian Industrial Relations Commission
- certification of union and non-union collective agreements
- the introduction of individual statutory employment agreements (Australian workplace agreements – AWAs) and the establishment of a new statutory office, the Employment Advocate, to perform various functions including approval of AWAs
- transfer of the jurisdiction of the Industrial Relations Court of Australia to the Federal Court
- changes to the federal unfair dismissal system, to provide a 'fair go all round' and ensure that all applications commenced in the AIRC
- limiting award provisions to '20 allowable matters'
- voluntary collective bargaining instead of good faith collective bargaining
- prohibiting pattern bargaining.
In December 2005, the Australian Parliament passed legislation substantially amending the Workplace Relations Act 1996. The aim of the Workplace Relations Amendment (Work Choices) Act 2005 was to introduce a simpler, more flexible, national industrial relations system based primarily on the corporations power of the Australian Constitution.
The legislation came into effect on 27 March 2006. It substantially changed the role of the AIRC including:
- transferring minimum wage-setting to a new body – the Australian Fair Pay Commission
- transferring the function of approving collective agreements to the Office of the Employment Advocate
- introducing compulsory secret ballots before industrial action, with applications for ballot orders determined by the AIRC
- providing for voluntary dispute resolution through the AIRC or external service providers
- changing the eligibility criteria for making applications for unfair dismissal including exempting employers with less than 100 employees and employers undergoing structural change for operational reasons.