Battle cry for IR redemption

Mark down the date, Tuesday December 18, 2012, as one of the most historic days in Australian industrial relations history.

First, the states are coming back with a vengeance in industrial relations and increasingly in other issues (States rise up against Canberra's thumb, December 14).

Second, a state premier (Queensland's Campbell Newman) has recognised that an enormous percentage of the workforce work in unincorporated enterprises (my estimate is 55 per cent) and need entirely different industrial relations laws to the likes of BHP (High stakes in Queensland's emergency rescue, December 18).

Thirdly, a state premier (Victoria's Ted Baillieu) has banned one of the largest construction companies in Australia, Lend Lease, from gaining Victorian government work because it did not comply with the state's commercial building guidelines.

This dramatic change in the Australian landscape will spread so vested interests will now take unprecedented steps to stamp out and/or contain these developments. Victoria wants to follow Campbell Newman in unincorporated enterprise rules so Newman will be tested with enormous pressure to stop him acting. New South Wales Premier Barry O'Farrell is looking to reduce NSW infrastructure building costs by following the Victorian guidelines and so will also face the fury of the union and commercial building cartels.

Yet suddenly enterprises in Australia may be able to choose how they are structured.

In the small enterprise sector, if Campbell Newman acts and Victoria follows, then small enterprises in those states can choose whether they remain incorporated and be subject to rules designed for large companies or whether they should be unincorporated. Many will go down the unincorporated route because they already have their personal assets on the line.

In the large building arena companies like Lend Lease and Leighton may decide that they do not need Victoria and stay with the current union deals. They will gamble that the New South Wales premier does not have the willpower of Ted Baillieu and in the end will pay the high tender prices that come with union control of subcontractors and/or building sites.

However, if the three state premiers stand up to the pressure then Australia will be dramatically changed. In my view that change will be for the better but a great many people will disagree.