Public Interest or Vested Interest
Enterprise Bargaining---The Way Forward
The Hon Joe Thompson, AM
Australia is now on the verge of an economic disaster
which could be one of the most serious in our history.
The Accord between the ACTU and the Federal Labor
Government has worsened our international trading position,
particularly in our manufacturing industries, and its
benefits have been largely illusory.
Many employers, particularly in the metal manufacturing
industry, have closed down the manufacturing section
of their enterprise and moved offshore, using their
Australian facilities for storage and distribution
only. We are importing a vast range of products in
our building industry and for the supermarket shelves,
which previously were produced in Australia. Our motor
industry is only a shell of what it was 5 years ago
with a vast range of component parts being imported
and sold, when assembled, as a so-called Australian
car.
Much of our decline can clearly be traced to the Accord,
and we are now about to negotiate Accord Mark VI. Most
workers find it difficult to understand why the real
value of their wages has been deliberately reduced
in deals between the ACTU and the Government, while
people not bound by the Accord have never been better
off. Luxury housing can be sold overnight at immense
prices and importers of luxury cars find it difficult
to keep up the supply. There certainly has been a major
boom but few workers under the Accord have shared in
this boom.
The price the leadership of the ACTU and the Hawke
Labor Government have paid in the pilots' dispute to
prop up the Accord will be felt by the trade union
movement long after the Accord has been dismantled
and buried. It will be interesting to see what the
reaction of the ACTU will be if a future non-Labor
Government, faced with a strike which they deem to
be of national importance, imports workers, both skilled
and otherwise, to break the strike and also subsidises
the employers during the strike.
There can be little doubt that we need to completely
re-appraise our whole system of industrial relations
in Australia and this applies at both State and Federal
level. Until we have a sound industrial base, we will
continue to fall further and further behind the rest
of the world. The two most prosperous nations in the
world, Germany and Japan, have built and are continuing
to build their prosperity on a manufacturing base.
Tourism and other forms of 'Mickey Mouse' industries
have only played a very minor role in their economic
success.
The New South Wales Government has taken the lead
in attempting some reform in the industrial relations
system in that State and part of the reforms will be
the encouraging of enterprise bargaining. To date the
legislation has not passed through the parliament and
there is some opposition from the NSW Labour Council.
There is also opposition from some employer associations,
or what is called the 'Industrial Relations Club',
and this is to be expected. Not only is our industrial
relations system the most inefficient in the world
but also the most legalistic and hence the opposition
from the industrial courts, commissions, unions and
employer associations, who live off the system.
For enterprise bargaining to be successful only one
union should legally be allowed to represent the workforce
in a particular enterprise. The core of Australia's
chronic industrial relations problem is the multitude
of unions at both enterprise and industry level. Until
the problem is solved our chaotic system will continue
and our chances of re-activating our manufacturing
industry will be nil.
No amount of discussions with the ACTU will lead to
enterprise or industrial unionism. Obviously the ACTU,
which is the most powerful national trade union body
in the world, wishes to keep its power, which primarily
stems from multitudes of unions in every industry.
Our system ensures the dominance of the ACTU to represent
the broad interests of the whole workforce. In the
United States the equivalent body to the ACTU, the
American Federation of Labor and the Congress of Industrial
Organisations (AFL-CIO) does not have the same power
as the ACTU primarily because in the United States
only one union or bargaining agent is permitted at
each enterprise.
The Hancock enquiry into our industrial relations
system failed miserably in this area with only a recommendation
to allow single union coverage in new enterprises.
This has led to the so-called 'greenfield industries
legislation', under section 118 of the new act. Even
this section is unclear, as no provision is made to
cover the problem of unions not having the constitutional
coverage to cover all workers in that enterprise. In
the Green Paper on Industrial Relations prepared by
Professor John Niland for the New South Wales Government,
recommendation 35 certainly goes in the right direction
for a single union or bargaining agent to represent
a particular enterprise.
There is increasing evidence to show the degree of
disenchantment among the rank and file union members
with their union leaders. A number of unions whose
leadership was predominantly left have changed to leaders
of the right-wing persuasion and a number of right-wing
led unions have fallen to the left. This disillusionment
within the union movement generally is the major reason
for the continued fall in union membership, and unless
the ACTU realises that its prime responsibility is
to represent the Australian workforce and not assist
in the propping up of a dubious Accord, union membership
will continue to decline.
Australian industrial relations systems evolved from
the latter part of last century when we were insulated
from international competition and relied primarily
on the export of primary products to Britain in exchange
for most of our manufactured goods. It was under this
easy system that our industrial relations system evolved
and it laid the basis for what was to be a reasonably
satisfactory system. We were spared some of the extreme
labour disputes which countries such as the United
States endured, which in many case led to bloodshed
and great suffering by the workforce.
With the industrialisation of Australia, however,
the arbitration system needed to evolve to meet the
changed circumstances. Our union movement strongly
followed its British counterpart with a system of craft
unions but unlike Britain we also have a highly centralised
and legalistic system of industrial relations which
was based on compulsory arbitration.
The system encouraged multitudes of unions and insisted,
as it still does, that a union have a registered constitution,
which lays down the scope of a union's membership coverage.
This is the prime reason why we see up to 26 unions
in some organisations, most with State and Federal
registrations and constitutions, and many with only
a handful of members, but having the power to stop
the company or enterprise from working. It is this
situation which gives such immense power to the ACTU
as it acts as the co-ordinator.
This situation applies to the whole of Australia's
workforce and is unique in the world. Until legislative
steps are taken to break the stranglehold of this system,
we will never be able to compete on a world basis in
any industry but particularly in manufacture. Much
of our economy has been deregulated to allow us participate
in a rapidly expanding world economy, but, our industrial
relations system has now been regulated to an extent
never known before.
Any union which had the idea of breaking away from
the centralised wage system would think twice after
seeing the treatment meted out to the Federation of
Air Pilots.
The ACTU executive is little more than an arm of the
Federal Government. In Eastern Europe the Communist
Party is disintegrating and with it, their so-called
trade unions which were an arm of government, to be
replaced with genuine trade unions, independent of
the government.
There is a clear message in this for the Australian
trade union movement. The centralised wage system has
placed our whole workforce on the basis of the lowest
common denominator. Enterprises with a fine workforce
or a highly successful operation are put on the same
level as the mediocre and the inefficient. The pilots'
dispute has highlighted the weakness in our industrial
relations system. Had the pilots been affiliated with
the ACTU, the ACTU would have found a way to accommodate
them. This has happened many times when powerful affiliates
have demanded a way be found to circumvent the guidelines
of the Accord and a way has always been found. The
decimation of the pilots' union has strengthened the
ACTU immeasurably and a small group of people on the
executive of the ACTU now, for practical purposes,
control the whole of the Australian workforce, and
this applies whether they are members of a union or
not.
Enterprise bargaining ensures that it is in the interests
of both employers and employees for an enterprise to
become and remain prosperous, and they can do this
without the need of a legalistic industrial court system
or the ACTU. We need legislation to ensure that employees
are given the right to bargain collectively with their
employers or through their own union if they so choose.
The right of workers to be able to choose a union
to represent them is most important. In our industrial
relations system they are not given this right but
are forced to accept a union which has the constitutional
coverage to cover them whether they approve of the
union or not. They are not allowed to present their
own case before the Industrial Relations Commission,
and in many cases an award which is legally binding
is placed over their enterprise with the employees
having no input whatsoever.
As a first step to enterprise bargaining, legislative
action is necessary to remove the impediment of 'constitutional
coverage'. Currently, if a union wishes to change its
constitutional coverage, it must notify the Industrial
Registrar and then all other unions are notified of
the proposed change and given the right to object.
Obviously no union is going to agree to a competitor
and so for practical purposes it is almost impossible
for a union to change its constitution.
For enterprise bargaining to be successful, only one
union must represent a workplace. Currently groups
of unions, particularly in the building industry, have
set up, usually with the assistance of state labour
councils, some type of collective agreements on particular
jobs, but it is a crude and inefficient method of enterprise
bargaining and again shows the need for legislative
change to remove the shield of 'constitutional coverage'
which prevents unions from competing with each other
for union membership.
The ingrained legalism in the Australian system of
industrial relations must be removed before we can
start to restructure our manufacturing industry properly.
The trend of many companies to move offshore to escape
the system is very damaging to our national interests
and must be reversed.
A further step which would be of great benefit to
all enterprises and in particular to those engaged
in manufacture is an expansion in employee involvement.
Many progressive companies are introducing such schemes
but an impediment to their success has been the multitude
of unions in the workplace. Some unions are strongly
opposed to such schemes and others place conditions
on them which can affect their efficient working. In
New South Wales there have been quite spectacular results
with some employee involvement schemes but in every
case the success has been linked to an enterprise which
has had only one union covering the workforce.
Whilst our whole system of industrial relations has
been based upon a third party (the Commission) to settle
disputes, an efficient enterprise bargaining system
would place greater emphasis upon direct negotiations
with the workforce itself and the management. This
rarely occurs under our present system, where normally
a union official and a representative of the company's
industrial relations section appear before the Commission,
some agreement is made and the employees are told of
the agreement at a meeting with a recommendation that
they accept.
In conclusion, we need a complete re-think of our
industrial relations system. If we are to survive
in the world economy we must re-activate our manufacturing
industry and this will only be possible with a system
of industrial relations more in tune with the rest
of the world. This will require legislative action
to ensure that only one union represents each industry
or enterprise and that employees have a free choice
of who shall represent them.
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