The ACTU (still) knows better

One of the Australian Council of Trade Union’s (ACTU) goals in its current anti-WorkChoices campaign is to increase the number of “protected minimum standards” from five to ten.

Currently, the federal Workplace Relations Act guarantees a number of workplace rights for workers. The standard sets a national minimum wage; sets a maximum of 38-ordinary hours of work a week; allows for four weeks of paid annual leave (with an additional week for shift workers); provides ten days of paid personal or carer’s leave (including sick leave and carer’s leave) with provision for an additional two days of unpaid carer’s leave per occasion and an additional two days of paid compassionate leave per occasion; and also provides 52 weeks of unpaid parental leave (including maternity, paternity and adoption leave).

The ACTU wants to add to these. Two of the additional minimum requirements for all workers that it wants added to the standards are that workers should not be allowed to cash out any of their annual holidays, and that workers will not be allowed to undertake “unreasonable” overtime. In relation to what is “unreasonable” the ACTU proposes a more “stringent test” by setting a prescriptive formula that states how much is too much.

Restrictions on employers’ capacity to require workers to undertake “unreasonable overtime” have been firmly in place in Australian Industrial Relations since the 2002 Australian Industrial Relations Commission (‘AIRC’) handed down its judgment in the Working Hours Test Case. Quite simply, employees can refuse to work overtime that is unreasonable. What constitutes unreasonableness can be determined by referring to an “employee’s family responsibilities and their health and safety”.

Of course, this loose formula for determining reasonableness can clearly sometimes lead to disputes. What appears “reasonable” to an employer can be disputed as reasonable by an employee. For instance, some employees with children may claim that any overtime is unreasonable, whereas an employer may see this as “unreasonably” inflexible.

The ACTU’s response is to propose a prescriptive “standard of reasonableness”. In other words, something like “two hours a week is reasonable, but three is unreasonable for all workers, in all instances”. This approach was rejected in 2002 by the AIRC. And rightly so.

Both the approach to “prescribing” reasonableness in relation to working hours with a formula, and the push to deprive employees the right to cash in any portion of their annual holidays (the federal Act currently allows employees to cash out up to two weeks a year) smacks of nothing less that blatant paternalism.

In other words, union representatives believe they know much better than individual workers what is good for them. Despite the fact that some workers may want the extra cash from working the overtime that some of their fellow workers may find unreasonable, or may want the money instead of the break and so be happy to cash out a week’s holiday: under an ACTU regime this flexibility would be denied to them.

A similar archaic paternalism seems to be characteristic of the Labor Party’s current approach to industrial relations, with industrial relations spokesperson Julia Gillard recently reported as saying that she was willing to allow high income employees the flexibility to negotiate these sorts of rights, but not lower income employees.

Why is it, according to the ACTU and the Labor Party that higher income employees are able to wisely make the decision about trade-offs between harder and longer work and income, but lower income employees are incapable of doing so?

None of the arguments put forth by Sharan Burrow, ACTU President on behalf of the ACTU, or Gillard on behalf of the ALP, justifies this miserly and patronising approach to workers rights to choose.

They both quite rightly point out that long hours can be bad for families. True, but more and more workers are not members of traditional nuclear families, or are one of two wage earners in a family where flexibility between the two partners in working hours can be managed to optimise family time and family income. The ACTU-ALP approach would deprive families of the capacity to do this.

Take an example: mum is offered extra overtime at the manufacturing plant where she works because other workers are off sick. This means she will not be able to pick up the children as usual. However, dad, with an hourly income less than mum’s hourly overtime rate has the flexibility to knock off early for the time mum has been offered overtime. The result is that the children see a bit more of dad than usual, mum has a few weeks of exhausting work, but there is enough extra money in the piggybank to upgrade the annual holiday a notch.

This, according to the ACTU and the ALP is not an option that should be available to “lower income” workers.

The very rejection of the ACTU’s approach to this issue in 2002 by the AIRC rested on this presumption: That what was “reasonable” or “unreasonable” in each circumstance depended upon the circumstances of the individual worker in question. A single prescriptive formula may assist some, but only at a cost to others.

There is simply no reason at all to impose a prescriptive formula of “thou shalt nots” where a flexible approach will deliver what is best for an individual worker according to their own circumstances.