Australia’s IR policy favours bosses

Paul Kelly of The Australian characterises the industrial relations debate as a difference in cultures, namely "that workers must be given a genuine choice between awards on the one hand and collective agreements and individual contracts on the other. And if this choice is genuine, then the no-disadvantage nexus between awards and agreements needs to be broken so that most or many minimum conditions in agreements are no longer tied to minimum conditions in awards."

While Kelly's analysis is problematic, he identifies one of the key tests for Government IR policy (Flexibility and productivity in the workplace: the key to jobs; A New Workplace Relations System; A plan for a modern workplace). But does its policy offer workers free choice in the workplace?

Government policy rests on its ideology of freedom of choice and its uncritical adherence to the idealistic liberal scenario of individual employees and an employer making real, "mutually acceptable arrangements". The policy, however, is inconsistent.

While setting up an industrial relations system clearly geared to individualising employment relationships and making it as difficult as possible for unions to organise and represent employees, the Government advocates collectivism for the farming sector. The Liberal Party's election policy on agriculture (Investing in Our Farming Future (pdf file 990KB)) proposed establishing a collective bargaining system for farmers, facilitated by changing the Trade Practices Act, and offering assistance to "groups of farmers to take advantage of the new collective bargaining arrangements".

It is not as if the Coalition does not recognise the inequality of individuals' bargaining power. Warren Truss, former Minister for Agriculture Fisheries and Forestry, and now Deputy Leader of the National Party and Minister for Transport and Regional Services, said on June 24 2005: "Collective bargaining gives farming, fishing and forestry small businesses a stronger bargaining position in negotiations with big business."

Why then does the Coalition find collectivism in IR so abhorrent, while making an exception for farmers? It is a case of ideological distortion of the power relationship of the workplace while recognising it for farmers. As Alan Fox argued in Beyond Contract: Work Power and Trust Relations, this ideology legitimises the imbalance of power between employer and employee and management prerogative, where for much of the time the employee feels "virtually coerced" into "settling for whatever he [sic] could get".

Ideological distortion explains the Coalition's inconsistent approach to collectivism. It is not as if the Government does not provide a choice for workers. As the Minister for Industrial Relations, Kevin Andrews, told the National Press Club on May 31 2005, "Employees deserve the freedom, the flexibility to choose whether to belong to a union or negotiate directly - as an individual or a group - with their employer about agreements best suited to their workplace not a 'one size fits all' award or pattern agreement".

What Mr Andrews did not spell out was how proposed IR changes will impede workers’ opportunities to access collective representation. Liberal Party policy makes it clear that "allowing third parties to intervene in your workplace" is a characteristic of Labor's policy that will "destroy jobs and reduce flexibility".

"Third party" representation in the workplace is clearly anathema to John Howard's and Kevin Andrews' brand of liberalism. But only if third party representation is collective, it seems. The key option for employees is the choice to be represented collectively or an individualised IR system (Australian Workplace Agreements). But, the Liberals’ policy is hell-bent on making collectivism as difficult as possible by further constraining the ability of unions to organise in workplaces, effectively withdrawing easy access to representation from the individual, while the reality of individual contracts is employees usually have no choice. Real freedom of choice depends on having options.

In the Coalition's "new" IR, the real power relationships at work, the economic dependence of most Australians on their ability to work and remain employed, and the pragmatism of running a business mean the individual employee exercises only the choice to enter into a contract or not to remain with the employer. Individual, unrepresented employees with nothing other than their labour skills and knowledge to offer are at a distinct bargaining disadvantage. Some employees are in a better position because they have managerial or specialist skills in short demand. These are not the majority of Australian workers.

Surely supporters of labour market deregulation will say the Workplace Relations Act presently makes it possible for an individual employee to be represented by a bargaining agent. The new legislation is unlikely to change that. But what manager in a small or medium sized business will have the patience with some third party agent if they are using AWAs to get away from the "intrusion" of third parties (unions) and the inconvenience of negotiating an enterprise bargaining agreement? What employee or job applicant will go to the trouble of appointing in writing a bargaining agent as the Act requires? And what employer will appoint a job applicant who insists on a bargaining agent negotiating their employment contract? If the Liberals' IR system is not designed to fail on this point, it will fail the test of employee choice in most cases.

And that is the point: with the Coalition's IR policy, freedom of choice has more to do with the employer's choice than the worker's because it does not acknowledge the power relationship at work, while the Government legislates to improve the bargaining power of farmers through collective arrangements to address the power imbalance in dealing with powerful, big business.