Workplace Relations Minister Peter Reith proposed last week a change to the basis of Australian industrial relations law. In doing so he highlighted some of the major drawbacks to the present system. The present system grew up around what was supposed to be a limited constitutional power for the Commonwealth. Industrial relations were to be primarily a state matter except when there were instate disputes. But rather than have the Commonwealth limited to a role where there were genuine interstate disputes, ordinary industrial relations were artificially contrived to have interstate elements and elements of dispute. This was and still is done with by having federal unions and ambit logs of claims. So the ordinary amicable negotiation in a small workplace with no interstate connection could be drawn into the federal net.
This development had several drawbacks. Despite recent changes under both Labor and the Coalition, the drawbacks to the system continue. The present system requires the generation of a dispute to attract the jurisdiction of the Commonwealth. It is an unhealthy start to industrial relations which should be about co-operation in the workplace for the benefit of both employers and employees. The requirement of an interstate element has meant a system of federal unions and awards applying across whole industries. Often the awards are not tuned to local conditions, local productivity or the local economic situation. It has often meant workers miss out. Their enterprise might fail because award conditions cannot be met. On the other hand, a prosperous enterprise will be reluctant to improve employee conditions for fear of disapproval by other employers. Improvements have been made to make the system more enterprise focused, but old ways are dying hard.
Mr Reith has proposed changing the system to base it upon the Commonwealth’s corporations power, rather than the industrial relations power. Under his proposed system the Commonwealth could provide some basic conditions and employment principles that would pertain to all companies and the results of individual bargaining would be added.
Unions could still represent employees when called upon, but unions would not have to be actual parties to industry-wide disputes. Employers organisations would also have a lesser role.
In principle the changes have merit. Their biggest drawback is that people employed by partnerships or sole traders would not fall within the Commonwealth’s corporations power. It would require a co-operative scheme with the states to bring them in.
The need for a co-operative scheme is perhaps a blessing. For too long in Australia, industrial relations law and administration have been dogged by excessive change every time there is a change of government – in a way that does not happen in most other areas of law. Labor gets in an changes the law to favour its mates in unions. Then the Coalition gets in and undoes those changes and introduces some changes to favour its mates in the employing classes.
A co-operative scheme would necessitate some cross-party agreement to initiate and run. Invariably one or two governments are of a different complexion to the others, so some middle course would have to be charted.
A corporations-based scheme would have to accept that many employees are not confident or capable of negotiating their own employment conditions. Nor is the bargaining power equal. If employees want union representation they should have it. If they don’t it should not be forced on them.
It would be sad if what looks like a promising change founders because of suspicion surrounding its main proponent. Given past events, it is too easy to view Mr Reith as a serial union-basher, finding one weapon after another to fell his quarry.