ACTU President Jennie George abhors the new laws presented as the great opportunity for employers to wind back employment conditions for workers in key industries.

There can be no question that there have been some considerable changes in Australia’s industrial relations environment since the election of the Howard Government almost two years ago.
The Government’s clear intention in making significant changes to industrial relations legislation was to weaken the position of unions and reduce the award safety net applying to low-paid workers.
It could not be said, however, that developments following from the legislative changes have gone entirely, or even substantially, in the direction sought by the Government.
In particular, it has not proved so easy to persuade employers to go to war against their employees and the unions which represent them.
Right from the start, Industrial Relations and Small Business Minister Peter Reith has publicly exhorted, and privately cajoled, employers in the waterfront, coal mining, building and meat processing industries to grab hold of the new legislation and take on their employees. The legislation is presented as the great opportunity for employers to wind back employment conditions for workers in key industries.
By and large, however, Mr Reith has not been successful. Employers have made it clear that they are not prepared to sacrifice the gains they have made through negotiated agreements with unions in order to become foot soldiers in the Government’s ideological crusade.
Mr Reith’s disappointment at the sensible resolution of the dispute about non-union labour on the Cairns waterfront was obvious, hardly surprising when it appears that he was largely responsible for inciting the company to commence the dispute. Australian business must be having a great deal of difficulty in understanding how Mr Reith believes a protracted national waterfront dispute could be in Australia’s interests.
So far at least, Rio Tinto has emerged as just about Mr Reith’s sole loyal lieutenant, although he can hardly take the credit. As CRA, the company had established impeccable union-busting credentials well before the last election.
The attacks on coal industry workers by Rio Tinto and the US giant Arco go well beyond anything we have seen in this country for decades. The use of American-style union-busting goons to intimidate sacked coalminers in the small Queensland town of Emerald is a case study in the tactics which the Government is urging on employers.
Nevertheless, there is no evidence that the business community or the general public is enamoured of a return to confrontational industrial relations, although the legislation makes this inevitable, to a certain extent.
Similarly, little interest has been shown by major employers in the Government’s showpiece Australian Workplace Agreements (AWAs). These are individual agreements which have been used by some employers to reduce wages and conditions where employees have little bargaining power.
In the hospitality industry, for example, AWAs have been utilised in a small number of cases to remove penalty rates and loadings and provide for employees to be required to work on any day at any time for a small increase in the base rate, going nowhere near full compensation for the lost penalties and loadings.
Only a relatively small number of employers have made use of AWAs and their impact has been insignificant. This explains Mr Reith’s fury at the National Australia Bank’s decision to negotiate a collective agreement with the Finance Sector Union and to include a provision that future agreements would also be of a collective nature.
The reality is that although there are examples of employers resorting to AWAs, companies which have achieved the ability to negotiate collectively with unions for real improvements to wages and conditions, together with changes to the way work is done which provide real benefit to the enterprise, are unlikely to change.
Mr Reith’s increasing irritation with employers is a somewhat backhanded acknowledgment that the union movement has not collapsed as a result of the new legislation. Australia is clearly not going down the New Zealand road, which is good news not only for unionised workers, but for all employees, as well as those dependent on social security for part or all of their income.
A word should also be said about the applications currently before the Commission in relation to “allowable matters”; that is, those award provisions which the Act now requires be removed from awards.
These proceedings are being used by employer organisations as an excuse for a wholesale attack on award wages and conditions. For instance, in relation to the Hotels Award, the Commission is now considering an employer application to remove a range of conditions, including cuts in penalty rates and removal of rostered days off.
The Government’s vigorous support for all of this makes a joke of the pre-election promise that “no worker will be worse off”. They certainly will, if Mr Reith has anything to do with it.
As I said earlier, the union movement has had some considerable success in warding off the full effect of the Workplace Relations Act, both in relation to the right to strike and in relation to individual contracts.
However, we are not just about defensive strategies. Far from being cowed and reactive, the ACTU and its affiliated unions, even in this environment, are making significant gains and taking some exciting initiatives.


  • Enterprise bargaining continues to deliver real gains to union members in key industries, such as metals, building, vehicle, banking and finance, which have achieved average wage increases of between 4 and 7 per cent.



  • Although in the first Living Wage Case the Industrial Relations Commission was spooked by the Reserve Bank’s erroneous inflation and wages growth projections, the ACTU is continuing to pursue a fair level of wages for those dependent on award wages.



  • Recognising the importance of education and training, the new TUTA (Trade Union Training Australia) was established by the union movement following the abolition of the previous statutory body and the withdrawal of all Government funding. In addition, the ACTU has entered into a joint venture with Deakin University in Victoria to deliver accredited training to union members in their workplaces, with the aim of developing their generic skills, knowledge and competencies as a means of furthering lifelong learning.



  • Together with the Fair Wear Campaign, the ACTU was instrumental in achieving retailer agreement to sign a code of conduct in relation to the proper payment of outworkers in the clothing industry.



  • The launch of a loyalty program based on a “Union Card” which will give the union movement’s 2.3 million members access to cash rewards through a broad network of consumer services.



  • Applications have been lodged in the Commission for a Job Security Test Case to increase the federal award standard in relation to Termination, Change and Redundancy. It is about time that we recognised the severe difficulties of retrenched workers, many of whom will remain unemployed for a long time, assuming they ever find employment. Some increase is only fair, particularly given that severance payments under NSW state awards are currently twice the level available under federal awards.


There is one issue in particular relevance to local government, which I would like to address, as it is definitely a key component of the current industrial relations environment, and that is Compulsory Competitive Tendering (CCT).
Although the introduction of CCT is not directly related to the federal Workplace Relations Act, it is part of a general move to reduce the terms and conditions of employment of those in the most vulnerable position in the labour market.
The Victorian experience with CCT has shown that although costs can be cut through reducing staff numbers and worsening employment conditions for those who remain, either as direct employees or through use of contractors, this cannot be achieved without reductions in service.
Just about any Victorian rate-payer would be able to tell you about unrepaired potholes, weed plantations in streets and lanes, and reductions in community services such as maternal and child nurses, libraries, meals on wheels, community centres and even swimming pools.
There must be real doubt as to whether these changes have served the interests of local government. In many cases the community blames the councils for the effects of restrictions imposed by the State Government. The recent announcement that councils will be allowed to increase rates is hardly likely to achieve a great deal in terms of community support.
CCT has been used to reduce wages and conditions by means such as cutting staff, using contractors who employ on lower wages and conditions or forcing employees to agree to reduce their conditions in order to tender for their own jobs.
Interestingly, the Victorian experience has bee that the most vulnerable local government employees are those whose private sector equivalents are low-paid, ununionised and/or relatively less skilled. Wage reductions resulting from CCT are far less for groups with formal qualifications, such as engineers, librarians and tradespersons, or in strongly-unionised sectors such as garbage collection.
A significant effect of CCT in Victoria has been to widen the gap between the highest and lowest paid workers – a result which is consistent with the market orientation of the Government, but which represents a direct assault on the values of social equity which have traditionally underpinned our industrial relations system.
The most enthusiastic proponents of CCT, and so-called competition policy in general ignore many of its weaknesses. In relation to employment, these include administrative and legal expenses of the tendering process and the cost of redundancies.
Other concerns are the loss of local employment particularly in rural areas, where local government has traditionally provided significant employment.
There must also be concern obsessive concentration on reducing labour costs devalues the importance of employees to the service objectives of the council. Focus on short term budgetary concerns to the exclusion of all else must inevitably mean a reduction in the quality of the services provided to the community.
The position of the NSW Government that it will not impose CCT on local government should be welcomed and encouraged. It is interesting to note that the new British Government is pledged to abolish CCT in the country where it was all started, by Mrs Thatcher in the 1980s, albeit with a somewhat less gung-ho approach than that adopted by Mr Kennett.
It is good to see that NSW remains as a beacon to the nation, holding out against complete abdication to market forces, and retaining some concern about the lives of ordinary people.
I am personally quite optimistic about the future for the union movement. The election result in South Australia shows that people are prepared to change their vote to restore the balance in our political and economic life. I agree with Kim Beazley that Labor is in with a chance at the next election.
The decision by Cheryl Kernot to join the Labor Party reflects the community’s concern at the direction of the current Government. The tidal wave of economic rationalism and privatisation at all costs must subside; the community is demanding economic policies which take into account the needs of ordinary people in a civilised society. This must include jobs, together with a proper level of services, particularly health, education, infrastructure and social security
However, the future of the union movement is not dependent on which party occupies the Treasury benches in Canberra.
There has been a decline in union membership, mainly due to structural changes in the labour market, together with more aggressively anti-union attitudes taken by employers and some governments.
That issue is being vigorously addressed by the union movement, and it is encouraging to see research by Dr David Peetz from Griffith University showing that public sympathy for unions is at its highest point since the 1970s.
There is also anecdotal evidence of increases in union membership by workers feeling insecure, and worrying about privatisation or being faced with a demand from the employer to sign an individual agreement, which would lead to a loss of existing entitlements.
In conclusion, I want to leave you with an assurance that the union movement is not disappearing, and that we can continue to work co-operatively with those employers, including local government, who recognise that there must be benefits in change for all parties.
Address by ACTU President Jennie George to the Local Government Association of NSW Port Macquarie Tuesday 28th October, 1997