High stakes in Queensland's emergency rescue

Queensland Premier Campbell Newman would not have canvassed the idea of taking back control of the industrial relations for unincorporated bodies if he didn't intend to take action.

And because he is aiming at about 55 per cent of the Queensland workforce we are looking at an enormous change in the Australian industrial relations scene.

That's why the firestorm of criticism from the federal government, the unions, big business lobbyists, and even some small enterprise lobbyists will be almost hysterical.

But if Campbell Newman can stand the heat and goes ahead, Victoria is ready to follow as part of the new era of co-operation between eastern states (States rise up against Canberra's thumb, December 14).

New South Wales Premier Barry O'Farrell cannot follow because he does not control the upper house.

My guess is that Campbell Newman is up to the task because it is the only way Queensland can regain momentum in the light of the tough times looming in coal mining and the likelihood of a continuation of the current high dollar or an even higher currency.

The same applies to Victoria. Right now the small enterprise sector of Australia is really struggling. It desperately needs help. Campbell Newman is the first political leader to recognise this and offer tangible assistance.

Let's look what Campbell Newman would need to do if he took control of unincorporated enterprises and why my figure of 55 per cent of the Queensland workforce is so much higher than that being canvassed by the Queensland government.

Campbell Newman has become the first political leader in Australia to realise that industrial relations in small enterprises is totally different to large companies. Except in very big family businesses, in large enterprises the owners are totally divorced from the managers and executives. The executives are well rewarded and do not suffer personal financial pain from strikes or employee actions. They become very powerful and as a result, the community adjudges they should be subject to complex industrial relations laws to protect workers.

And those laws are based on the Commonwealth's corporations power in the Constitution. But unincorporated enterprises are totally different. In this situation the "owner” usually has his or her house on the line and suffers financial pain personally in any industrial dispute. Moreover, the owner is also a worker in the enterprise. Despite being totally different to large enterprises, unincorporated businesses are subject to the laws designed for huge business.

Campbell Newman is looking at a simple industrial relations scheme with an hourly rate which would be generous, given there would be no shift allowances. There would have to be provision for overtime, holidays, parental leave etc.

There would be a practice set for dismissal and a body outside unions and lawyers to determine whether the owner acted in accordance with the Act. Suddenly Queensland (and Victorian) unincorporated business could operate around the clock – if it made sense.

Fascinatingly, Campbell Newman has dramatically underestimated the number of people who would be directly affected.

The head of the Independent Contractors Australia (and regular Business Spectator contributor) Ken Phillips tells me that in Australia there are 2.1 million self-employed workers, of which 1.1 million do not employ anyone. The remaining one million employ an average of six people – in other words there are seven million people working in this sector including the owners. Adding those who do not employ, that's a total of eight million people, or 72 per cent of the 11.5 million work force.

Determining the number of incorporated enterprises in this total is difficult but statistics indicate that of the 8 million workers probably about 6.3 million, or 55 per cent of the total, work in unincorporated enterprises.

There is no reason to believe the Queensland figures are different. Campbell Newman's statistician left out the fact that the so-called owners are also workers.

Campbell Newman is playing for big stakes and the future of his state. But he will face opposition on a scale that will be more furious than he could imagine.