The new Workplace Relations Act aims to make the effective functioning of organised labour much more difficult argues ACTU Assistant Secretary Tim Pallas.

If you believe that changes to industrial relations law is the burning issue of our time, chances are you fall into one of the following categories:


(a) a lawyer looking for some more work;


(b) an editorial writer from the Murdoch or Packer press committed to ensuring a balance of comment from all views of the world you are aware of, both from the right and the ultra-right;


(c) a conservative politician keen to repay in kind all those millions of dollars of campaign contributions received from big business; or


(d) an employer who has always wanted the opportunity, to use an euphemism, for a little downward wages flexibility.


For the rest of us, its application will be peripheral to the real work of representing workers or running a business. It is not much that the legislation is irrelevant but rather this and for that matter any form of legislation’s relevance is largely dictated by its balance.


The transparent lack of balance in this legislation will ensure that in workplaces where a fair go is the principle underpinning the way workplace relations are handled, the change of name to the Workplace Relations Act is the most substantial alteration that will have occurred.


There is no doubt that this legislation aims to make the effective functioning of organised labour much more difficult. Whether it succeeds in that objective will depend on the competence of unions themselves and equally importantly the extent to which employers wish to become complicit in the implementation of the more negative aspects of the legislation.


The Act is designed upon a number of simple and quite erroneous assumptions.


(1) That unions depend on the award system for their relevance so the erosion of the system of award based protection will have a subsequent and correlated effect upon unions organisational capacity.


In the recent Transport Workers Award Special Case hearing the Australian Road Transport Industry Association have presented the Minister’s position as follows:


“Peter Reith has made it perfectly clear to us that is about his ideological opposition to unions.


“We met with him and he basically said that an award is a mechanism a union can use to justify its existence and therefore to remove the unions you remove the relevance of the award.”


Indeed, that should not come as a surprise to anybody. The Government believes the erosion of a robust level of award protection is important to create the right sort of environment of desperation amongst workers to drive them into an agreement-making process where a suitably motivated employer is well placed to extract the maximum damage to these existing conditions.


(2) The more opportunities the legislation provides for Commission and Court-based litigation the greater the opportunity to tie union resources up in those processes rather than asserting their relevance in the workplace.


There is no doubt that the legislation, while it remains in existence, heralds the slow but inexorable decline into irrelevance of the system of award based protection we as a community have come to expect as a constant in the shifting framework of industrial relations in this country.


Perhaps there is no greater illustration of the award system’s ultimate demise than the fact that outside the so called twenty allowable matters constituting both the future scope of awards and the Commission’s jurisdiction, no new matters (other than exceptional or incidental and essential matters) can be made.


Such an approach has the effect of ossifying the award system, ensuring that into the future it is not relevant to the changing needs of our community. The fact that any matter outside the twenty allowable matters is outside the scope of the award and Commission jurisdiction means that the Government has resurrected by legislative fiat the debunked notion of managerial prerogative.


Justice Lionel Murphy in FCU v. VEF (1984) 154 472 at 494 forcefully expressed why managerial prerogative over the employment relationship has been tempered by our system of justice.


“During this generation there has been an accelerating trend towards concentration of economic power in few and fewer persons …. a reaction to the submergency of the individual worker is the demand by organised workers for some share in deciding what work is to be done, by whom and when, where, and who it is to be done by. The thrust of this demand is not merely the improvement of existing pay and conditions it extends to the protection of jobs, for themselves and other workers, but is more than that; it is a demand to be treated as more than wage hands – to be treated as men and women who should be informed about decisions which might materially affect their future and to be consulted on them.”.


The great strength of this judgement is that it focuses attention on the fact that economic rights in their pure sense are but one element of the employment equation. Another fundamental concept is that of equity and social justice – those basic human rights that suggest that people engaged in an employment relationship deserve to be treated with respect.


Unfortunately for us all, because I believe our society is the poorer for it, these basic employment rights are no longer assured by our award or federal system of conciliation and arbitration.


As these rights decline in an award context, those who most depend upon them for a measure of workplace justice will be exposed.


They can be assured that the Australian union movement will be there ready to assist them in cases of abuse and exploitation.


The significant change in the legislative scheme will necessitate that unions will have to concentrate upon collective bargaining processes whether it be at an enterprise or industry level to effectively service their membership needs.


Increasingly the emphasis will be upon the servicing of members rather than all workers. Not out of desire but out of necessity.


For workers to achieve improvements in living standards the emphasis will be upon bargaining processes. With an inability to achieve improvements at the macro level the union movement will necessarily have to concentrate its efforts at the workplace.


The erosion of the award system was never part of this Government’s so-called mandate.


Prior to the election the following commitments were made:


(1) “Employees will be given the choice to remain with the current award system” [John Howard 8/1/95]


(2) The iron clad guarantee of 13 October 1995 “we will not force workers off awards”.


(3) “We stand for an effective choice between the award and a workplace agreement”. [8/1/95]


(4) Award simplification was described in Coalition policy as nothing more than a process of removing obsolete provisions and unnecessary detail.


(5) “Awards will continue to be updated as currently applies and the AIRC will continue to settle disputes and determine wages and conditions” [Coalition policy].


Compare these pre-election commitments to the Government’s post legislation perception of the role of awards and bargaining as contained in its TWU Special Case written submissions para 7:


“Awards are no longer required to constitute a secure relevant and consistent alternative if bargaining fails. This important change is also indicative of a different kind of award safety net than the concept in the previous legislative framework. The award safety net envisaged by the new legislative framework serves as a foundation protecting against hardship rather as a safety net underpinning bargaining.”.


In effect, what the Government is saying is awards should serve to keep the wolf from the door. If you as a worker aspire to anything other than economic subsistence then your so called choice must necessarily be to move out of an award of diminishing terms and protections into a bargaining process whose greatest commendation is that you may be able to claw back that which has been fraudulently extorted from you by this Government in its unremitting drive to favour the interests of employers over the interests of workers.


But what the Government takes away, those workers who act together through the union movement, and fair minded employers, can and will preserve.


Already this Government has expressed frustration at the 1,500 or more large employers who have agreed to avoid the nastier aspects of this legislation and to preserve all existing award conditions or any agreed alternatives into a collective agreement.


They want nothing to do with this mean spirited and dishonest Government agenda. This agenda is one that Peter Reith considers himself the principal sales person for. Repeatedly he urges employers to avail themselves of the perceived benefits of the legislation.


So, the industrial arm of the Liberal party, the Australian Chamber of Commerce and Industry acting under instructions, has dutifully proceeded to fill or cause to have filled applications to strip back awards in a dozen awards to the allowable minimum. All of this has occurred in the context of no discussions between any of the award parties and no recognition that the transitional period of 18 months encouraging co-operative discussions between the award parties rather than arbitral dictates has only just begun. No doubt this Government will not be able to restrain its award-gutting zeal, and, as with every other appearance in the Commission since the 1996 election, will sing in unrestrained harmony with its employer accomplices.

Unions And The New Litigious Regime

John Howard and Peter Reith want to take us down the path of a U.S. style system of employment regulation with union busting, litigation and 85% of employees on individual contracts.


However, they can only take us there in degrees. They will slowly seek to raise the temperature and hope that the community doesn’t notice what is happening incrementally.


The evidence so far: This Government has prided itself on the development of a range of new prohibitions on taking industrial action and sanctions against unions and individual members.


The Government’s advice to employers is to take on their employees and unions through the use of these new provisions.


Any form of industrial action no matter how minor can lead to Commission orders prohibiting industrial action and Court injunctions to augment an increasingly aggressive sanctions regime. Employers are told they are prohibited under threat of a fine from paying workers for any period of industrial action no matter how minor.


This is legislation sugar-coated in the rhetoric of choice but with a hard ideological edge. The view of the Government is if you are with them (unions) you are against us.


They have become the moral regulators of the workplace. Economic considerations are secondary to their ideological and political pursuits. While many may believe that the right to withdraw one’s labour is a fundamental tenet of a democratic state, this Government has decided that this right should be so narrowly defined as to become meaningless and any breach of these strictures is unlawful. International obligations, let alone conception of industrial equity, seem not to concern this Government at all.


And yet, not too many employers are in a hurry to avail themselves of this Government’s mutually assured destruction approach to industrial relations.


What is disturbing, is the increasing tendency at the periphery for ideologically- motivated employers to seek to litigate, prosecute and penalise rather than deal with issues in a pragmatic and mutually beneficial manner.


No objective observer of its behaviour or actions could reasonably infer that this Government is anything other than obsessed with an anti-union agenda.


Peter Reith wanders around the countryside exhorting union members to resign from their unions to give themselves a pay rise. On 31 December 1996, upon the proclamation of the Workplace Relations Act, the Minster elevated the capacity of workers to get out of unions to be one of the big ticket items of this new legislative scheme. So the news was that the Government outlaws compulsory unionism. My only query is where in the Act was compulsory unionism ever lawful. Indeed, Dr. David Peetz in a recent article explains that union compulsion has all but become irrelevant long before Peter Reith’s legislation. As Ross Gittins summarised:


“In fact its been in decline for ages. In the mid 1970’s more than a third of all employees were compelled to be union members. By the end of the 80’s, it had fallen to a fifth, and by the mid 1990’s to just one- tenth”.


Indeed up to 75% of the decline in union numbers is explained by the already apparent demise of compulsory unionism.


Union density rates among employees in areas where compulsion has totally been removed has remained relatively static over the past 20 years.

AWA’s & Employment Advocates

There is nothing new about individual contracts of employment. They were the preferred instruments of employment by employers of shearers and waterfront workers in the 1890’s. AWA’s are just a highly regulated form of individual agreement making.


By and large there is nothing particularly individual about the recent spate of legislatively sanctioned individual contracts.


These agreements are drafted on the employer’s terms and can (and invariably are) offered on a take it or leave it basis.


Once again, thanks to Peter Reith’s Workplace Relations Act bargaining preceding the making of an agreement is an optional extra that an employer can dispense with if they so choose.


AWA’s are clearly instruments intended to undermine any sense of collective security that may exist in the workforce.


This Government does seek to replace collectivism with individual agreements in a true sense but rather standard term contract.


The transaction costs of multiple and broad ranging agreement reached as a result of good faith contracts would be far too onerous. Instead these agreements are about asserting power and eroding entitlement in the workplace.


There is no doubt the legislative scheme elevates individual contracts to a preferred position over any other form of agreement made – for example, AWA’s override every type of collective agreement except a certified agreement within its terms. Even then AWA’s can be made provided they are contemplated by the CA.


Clayton Utz Partner Joe Catanzariti and Southern Cross University IR Lecturer Mark Baragwanath recently questioned the effectiveness of AWA safeguards. New workers are believed to be the most vulnerable under the individual bargaining processes with nothing in the legislation preventing employers from offering them inferior conditions to their colleagues. This is provided the no disadvantage test is met.


The treatment of these new employees will depend upon whether the Employment Advocate considers ne employees to be “comparable” to their longer serving colleagues.


Although one must question the efficacy of any safeguards provided by an Employment Advocate who has already indicated a preliminary view that offering an employee an AWA as a condition to employment is a lawful practice. So much for the myth of choice.


The Employment Advocate was according to Liberal Party policy supposed to be “independent and free of government control”. One more broken promise.


The Act ensures that the Employment Advocate is subject to ministerial direction. The reality is that the Employment Advocate is an administrator doing the Government’s bidding. There is no pretence of judicial or quasi judicial independence. To be assured of this the Government has started to stack the senior echelons of the administration with it’s mates.


The union movement has a categoric preference for collective bargaining and we will actively pursue this agenda. But we will not abandon workers who feel compelled to accept or prefer AWA’s. We won’t abandon unorganised workers to the mercy of shonky bargaining agency or worse still lawyers out to make a quick buck and to disappear.


Many employers may be pleased to learn that unions taking out bargaining agencies are unrestrained by their eligibility rules. A competition model of bargaining agencies and de facto unionism is a real possibility.


I am sure however that most unions who are currently in the process of gaining bargaining authorities or establishing separate bargaining agencies will do so responsibly and consistent with our general commitment to maximising union coverage and applying rational parameters of coverage.

Demarcation & Division

There is little doubt that this government has sought to involve itself in the internal functions of unions. The intention being to sow the seeds of dissent and undermine cohesion, such an attack will invariably fail.


Organisationally unions are offered the option to disamalgamate into parochial fractions of their pre-amalgamation partners. Leaving the remnants to fight over members, coverage and assets for a long time.


This is hardly a formula for advancing the well-being or efficiency of representative organisations of employees.


Maybe there are a few simple minded souls in the union movement who consider their interests are served by disamalgamation.


Paul Houlihan, one of the so-called experts Peter Reith used to help him draw up this legislation was quoted in the Australian newspaper when addressing a meeting of the HR Nichols Society that the disamalgamation was structured so as to get left wing unions. This would have to signify an all time low in public policy setting.


Perhaps one of the most emphatic demonstration of this de-unionisation eagerness can be seen by the way the Government deals with it’s own employees.


On 5 March 1997 all public service unions were advised that the Government has reviewed the practices of the Commonwealth deducting unions dues. Every union member in the APS must provide a new written authority for deductions to continue. If such an authority is not provided union deduction will cease.


The effect of this procedure is that the Government has chosen to disregard an employee’s choice to have union dues deducted and put in place a process which says you are financially out of the union unless you say you are in.


ACTU Assistant Secretary, Tim Pallas