Pattern bargaining in the construction industry has been under sustained attack now for about three years says John Sutton.

The Federal Government has yet another Bill before the Parliament [Workplace Relations Amendment (Genuine Bargaining) Bill 2002] to bring it to an end. The Cole Royal Commission is subjecting the practice to intense scrutiny. Sections of the media, (including AFR Edit 4/4/02), are complaining that the CFMEU has undermined one of the Government’s key industrial reforms by successfully bargaining their way to a 36 hour week and decent pay rises for its members.

What has caused this latest convergence of interest in pattern bargaining?

For the purpose of what follows, pattern bargaining can be taken as a union advancing similar claims on multiple employers. On the face of it, it seems a fairly unremarkable proposition to say that one of the basic functions of a trade union is to develop and pursue claims relating to the wages and conditions of its members. That is one reason why people combine to form unions in the first place. It has particular importance in a system such as ours where enterprise bargaining has been the centrepiece of our industrial system for well over a decade.

But the critics of pattern bargaining will tell you that their criticism is not directed at enterprise bargaining per se, but bargaining of a particular kind. The consistent theme of these criticisms is that bargaining is only legitimate if it is carried out at the level of the individual enterprise. Any kind of bargaining not confined to within the four walls of an enterprise is somehow less that the real thing.

The problems with this approach to bargaining should be fairly obvious and these are compounded when the model is applied to the construction industry.

First if it is accepted that unions and employer organisations are democratic and representative, why should they not be able to negotiate industry, sector or site agreements if they perceive that it is in the interests of their respective memberships to do so. Just as parties negotiate the content of their agreements, so they should be able to determine the level at which they negotiate in the first place. The ILO’s Committee of Experts has now twice pointed out that the present Act inhibits the exercise of that basic choice. The Government’s latest Bill will make that problem worse.

Second, the most vocal critics of pattern bargaining are generally the same group who consistently advocate leaving it to the market. When Rio Tinto claimed victory in the 1999 Hunter Valley dispute (with the AIRC declaring that all was fair in love, war and industrial relations) no-one in the Howard Government claimed that letting competing sides slug it out was producing bad results. But when the CFMEU achieved a 36 hour week in Victoria, there was no end to the list of those who said the system had to change.

Third, it seems that the Federal Government only objects to particular kinds of pattern bargaining. Mr Abbott’s own agency, the Office of the Employment Advocate, has devoted considerable public resources to the promotion of template individual contracts for the construction industry.

Now consider the genuine bargaining model in the construction industry. This is an industry with around 100,000 businesses, the overwhelming majority of them with fewer than 10 employees. Work-sites are typically multi-employer projects working within a contractual hierarchy that sets out a schedule of works with strict deadlines. The idea of 20 small firms on one site engaged in bargaining [and potentially, lawful industrial action] to achieve their tailor-made agreement would be scoffed at by anyone with the vaguest knowledge of how this industry works.

That is why the AIG has thrown its weight behind the concept of site agreements (a form of pattern agreement in themselves), because they see the benefit in setting out the clear terms on which a particular project is to be delivered.

The truth of the matter is that the only great sin of pattern bargaining is that it is a logical and effective response to a deregulated wages system. Believe it or not construction workers do have interests in common with construction workers outside the business that employs them. They expect their union to promote those interests. To deny them that right and to limit their horizons by legislation to the confines of an individual business, is simply a way of insisting that they bargain at the level at which their bargaining power is weakest. It is an ideological experiment that this multi-billion dollar industry and its workforce can do without.

John Sutton is the National Secretary, CFMEU Construction & General Division. This opinion first appeared in the Australian Financial Review, 10 April 2002.