ACTU Accentuates the Positive

Australia's unions have moved from opposition to the Howard Government's WorkChoices laws to proposals for reform. After a campaign which successfully branded the laws as biased and unfair, a delegation of union leaders has produced a report arguing that a new system is needed, not a return to the past. This report will provide the basis for ACTU policy to influence the Opposition not just to ‘rip up' the Howard laws but to replace them with a comprehensive and fair system with elements of US and European laws. In his September 13 address to the National Press Club launching the policy , ACTU Secretary Greg Combet may once again have given the union movement the initiative in the public debate about IR which has already seen the government on the back foot as the realities of its new laws are revealed.


Australia's national IR laws go back to 1904 when the system of arbitration and conciliation under an independent tribunal was established. For a century this system expressed a series of rights, without often making them explicit. These rights were the basis of a system in which income distribution was fairer and economic growth stronger than in many other countries. The award system was modified in 1993 by the enterprise bargaining reforms which have been credited with encouraging higher growth and employment.

The 2005 Senate majority gave an extreme conservative IR agenda the green light, making way for the most radical revision of the legislation in a century. The standard-setting role of the Industrial Relations Commission was replaced by legislated minimums and the new Fair Pay Commission, limits were imposed on the role and rights of unions, and statutory individual contracts were given predominance over collective bargaining and awards. Limits were also placed on the scope and influence of awards – which were the basis of the previous system.

This puts the industrial relations policies of the ALP and other opposition parties in the spotlight for the 2007 election, an election in which IR policy seems likely to influence the decisions of large numbers of voters. A poll of union members conducted by the ACTU has found that of those who voted for the Coalition in the last election (in some cases actually a majority of members), a surprisingly high number, nearly 70%, say they would or may vote against it in 2007 on the basis of the IR laws. Given that union members alone would be enough to make the difference in a number of marginal seats, the union campaign to convince their members in those seats could be decisive.

A New Model for New Times

In Greg Combet's address to the National Press Club he pitched for the rights of employees at work as part of the goal of a fairer and more democratic Australia. Instead of the values of the Howard Government, the union movement believed that the values of a fair share of national wealth to workers, more democratic rights and greater economic competitiveness to provide jobs would be attractive to the community.

The basis of the new system, which Combet said was not a return to the old blueprint, would be collective bargaining backed by requirements to bargain in good faith, a concept borrowed from the US and trialled in the 1993 laws but removed in 1996. The report calls the proposed system a ‘uniquely Australian system' based on Australian experience which meets the standards of international conventions of the International Labour Organisation.

The union movement in the past 20 years has suffered a relative decline in membership along with those in most developed countries. The causes are manifold but a changing culture in the workplace promoted by human resource management strategies are significant, as of course are shifts in production due to technological change and offshoring. Traditional industries remain highly unionised, as do service industries particularly in the public sector. By adopting a workplace focus for the new policy, and highlighting the democratic rights of employees in the process, the ACTU hopes to make union membership more relevant to employees in growth sectors such as services and IT.

In the 1980s the issues for unions were jobs and industry policy, superannuation, improvements in the social wage, notably Medicare, real wage maintenance and investment in public services expressed through the Accords. The focus in 2006 is on pursuing workplace rights so that employees can bargain effectively with employers through their union structures to redress the inequitable spread of income distribution and declining rights due to WorkChoices. The government's own evidence to a Senate Inquiry (Hansard, EWRE 98, 29 May 2006) is that individualisation of employment arrangements through AWAs is further reducing the work-life balance and level of entitlements for the most vulnerable employees. Women workers and those employed in casualised industries have suffered the most.

Thanks to Scratch

The ACTU's report argues that collective bargaining can play a central role in addressing workers' needs while remaining a vehicle for strong economic growth. The delegation looked at the systems operating in the US, Canada, UK and New Zealand in detail, and also considered European experiences. In rejecting the wholesale adoption of any one country's system in favour of a revised Australian system, the delegation takes the US notion of ‘good faith bargaining' as a requirement enforceable by a newly empowered and directed Australian Industrial Relations Commission.

‘Good Faith' Collective Bargaining

Collective bargaining is the centrepiece of the proposed policy; where it is not occurring ‘in good faith' the Commission would be empowered to order the parties to comply with steps to bring about a successful agreement. Evidence of the wishes of the workforce would be relevant in determining whether or not orders should be issued to bring this about, including the ordering of a secret ballot if the evidence is not conclusive.

In line with the wishes of the majority of employees, agreements could be pursued and concluded in a ‘pattern bargaining' campaign with single employers or on a multi-employer basis. ACTU and International Confederation of Free Trade Unions President Sharan Burrow told the ILO that prohibitions against pattern and multi-employer bargaining contravened ILO Conventions 97 and 98.

Where all else fails, and where a resolution of dispute is necessary, the Commission would be empowered to make a ‘last resort arbitration' to conclude the matter for up to three years. Despite Coalition attempts to portray this as a return to the compulsory arbitration system, the majority support requirement borrows from US and UK laws and the Commission would not be able to simply make awards to resolve disputes as it could in the past.

Workplace Relations Minister Kevin Andrews has claimed that the ACTU proposal would lead to the extraordinary situation where a single union member could seek to have a collective agreement imposed by order of the Industrial Relations Commission.

But the ACTU actually proposes that: ‘… where a union has a member [in a workplace], it would be entitled to represent the member and be party to the agreement.' That, in fact, reflects the current legal position even after the Government's Work Choices amendments. The law as it stands allows a union to initiate the bargaining process for a union collective agreement, where it has at least one member in the workplace.

In line with its policy, the ACTU proposal would not allow statutory individual contracts (AWAs) to exist to override a collective bargain, which can be concluded with or without a union as a party if no union members are present, but Combet made it clear that common law agreements to vary the arrangements for individuals will continue to be possible, provided the standards in the statutory agreement are not undercut.

Combet argued in his speech that the Fair Pay Commission as currently established was not the body for the future; its processes were somewhat ‘opaque' and notably fairness is included in its title but not its terms of reference. Neither did he see the Fair Pay and Conditions Standard as adequate because there would have to be a widening beyond the current five minimum standards, either by way of legislation or by empowering the Commission.

The ‘safety net' envisaged by the ACTU is as yet unclear, and will be covered in the policy proposed for its October Congress. However, the recent report explicitly assumes that ACTU policy will continue to support:

‘A decent, relevant and secure safety net of pay and employment conditions contained in awards and/or legislation that is able to be adjusted to take account of community and/or industry standards.' (ACTU report p 8)

The ACTU will be attempting to get the ALP and other opposition parties to support reforms to the Workplace Relations Act based on its policy in the next parliament if the government falls, and to prevent any further erosion of workers' rights if the Government loses control of the Senate. Based on current polling, both of these outcomes are distinct possibilities.

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