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Labor’s IR Policy

June 20, 2007 on 9:32 pm | In Uncategorized |

Australian trade unions have only themselves to blame for their current predicament.

Back in the later years of the Hawke/Keating Governments, the unions made a conscious choice to abandon the centralised wage-fixing system that had served them for almost a century. They opted instead for enterprise bargaining. It was not a decision made in response to a crisis, or as a result of coercion. They thought about their options and elected to go down the enterprise bargaining road.

A minority of union officials protested that unlike other post-industrial countries, Australia had no culture of workplace bargaining, nor did unions have an established grassroots organisation that could carry the administration of decentralised bargaining. They said that the outcomes would be unpredictable and there was no reason to believe they would be to workers’ advantage.

These protesters were ignored, perhaps because they tended to be the same people as were opposed to union amalgamations and also on the far left of the Labour movement. Under the leadership of Bill Kelty at the ACTU, enterprise bargaining became the strategy of choice. It’s beside the point to ponder with the benefit of hindsight whether any other strategy would have been better; the fact is that the unions made a decision without coercion and they have to accept the consequences.

To this day, it’s hard to understand their enthusiasm for enterprise bargaining. After all it was something that the Business Council of Australia had campaigned for vigorously since 1986. You’d think that alone would have set off alarm bells.

The prevailing mentality seems to have been that the unions could concentrate their persuasive powers on a handful of key employers to get favourable agreements, following which the rest of the industry’s employers would fall into line to sign identical agreements like sheep. From the very beginning this was a deluded fantasy in all but a few industries. Even in the ACTU heartland of Victoria – and the whole strategy was fatally damaged by so many union officials’ inability to understand that the rest of the country did not behave like Victoria – even in that state, pattern bargaining was at best a partial success and only in the traditional union strongholds like construction and manufacturing.

Hardly anyone in the union movement seems to have taken seriously the possibility that a future conservative government would gratefully use the unions’ own rejection of centralised wage-fixing as a platform to launch a frontal attack on collective bargaining. I suspect that it was mainly a failure of imagination: after 30 years of being central players in the public sphere, the last 13 as full partners with the ALP in running a large part of the federal government’s domestic agenda, they simply couldn’t conceive of an Australia in which unions didn’t have the power to bring governments to heel. If he has any shame Bill Kelty must still cringe whenever he recalls those ‘war in the streets’ speeches he gave in 1996.

Now the unions are facing the prospect that a Labor government might once again be elected federally. Rudd and Gillard must be resolute in telling the unions that things have changed since 1996. Unions can no longer claim to speak for all Australian workers. They are one of several important interest groups that governments should listen to – that and no more.

A suitable Labor IR policy would include these elements:

·         Parliamentary regulation of minimum wages and a small number of other employment conditions for all employees;

·         Guaranteed freedom of association for workers, so that unions could mobilise employees without fear of legal harassment;

·         Legislated protection of collective bargaining if that was the genuine wish of a majority of workers at a workplace or in an industry, with employers being required to bargain in good faith and workers having the right to strike during the bargaining period;

·         Statutory recognition of collective agreements so they were enforceable by unions;

·         Industrial action outside bargaining periods to be prohibited;

·         Special provisions for fixing wages and conditions in essential service establishments, with a prohibition on industrial action.

Such a system would put the onus on unions to mobilise workers if they wanted to engage in collective bargaining. If workers refuse to act collectively, then so be it. The unions made their decision 15 years ago and having made their bed they have to lie in it. Expecting a Rudd Government to let them avoid the consequences of their past decisions is just self-indulgent and shouldn’t be condoned.

The system I’ve sketched would allow unions to reclaim a central place in Australian public life, if they can win the hearts and minds of workers. If they can’t, they will descend further into irrelevance. We might find that a sad outcome, but it would reflect admirable democratic principles.