Australia seeks workplace reforms

John Howard says Australia's labour laws are outdated

The Australian government has unveiled proposals to radically reform labour laws in an effort to enhance productivity and competitiveness.

The measures include the creation of a new body to set the minimum wage and the exemption of firms with less than 100 workers from unfair dismissal laws.

Prime Minister John Howard said the reforms were needed to ensure the country's continuing prosperity.

But critics said the changes would disadvantage low-income families.

Productivity challenge

The Liberal government's attempts at industrial relations reform have been frustrated for many years by opposition from minority parties in the country's Senate.

However, after winning a third term in office in October, Mr Howard has sought to push through changes to a system of workplace relations which he has described as outdated.

Australia must take this step if we are to sustain our prosperity John Howard

One of his proposals is that employees of firms with over 100 staff should only be able to pursue claims if they have worked for a company for six months.

Mr Howard said existing regulations, introduced by the Labor government in 1993, had stymied job creation.

Mr Howard told the Australian parliament that the reform package - which also include guarantees of minimum levels of holiday and maternity leave - represented "one of the great pieces of unfinished business in the structural transformation of the Australian economy".

"Australia's continued prosperity hinges squarely on a flexible and dynamic labour market," he said.

"Australia must take this step if we are to sustain our prosperity and meet future challenges such as the ageing of our society."

Despite assurances from the government that the reforms would not result in wages being cut, opposition parties claimed that the proposals would penalise low-income groups.

"This is imposing John Howard's political will and political power on individual Australian employees," Stephen Smith, industrial relations spokesman for the Labor party, said.