The revolution we have to have

Industrial relations

The implementation of the “WorkChoices” legislation in 2006 is expected to be a significant issue in the Federal election in 2007. Growing insecurity and a sense of unfairness in the workplace is pointing to major flaws in this complex piece of legislation.

The “scrap the law” position being put forward by the ALP is not good enough as a response. While the “WorkChoices” legislation is a major step back in time for industrial relations it doesn’t make sense for the ALP to go back as well. There has been talk about a return to collective “bargaining in good faith” and “the Australian way” (by the ACTU) but the ALP can and must do much better than that.

What employees are looking for are better workplaces, which offer opportunities for participation, skills and advancement, better work-life balance, and fair sharing of the wealth created by their efforts. Is there a role to play for workplace democracy and employee share ownership (ESO) in meeting 21st century employee expectations? Are we not in need of a different IR culture? Neither workplace democracy nor ESO formed part of the IR “reform debate”.

Earlier, the ACTU/TDC Report Australia Reconstructed (1987) showed the way forward but Bob Hawke rejected its blueprint for industrial democracy as culturally inappropriate, something that “couldn’t be done here”: a fork in the road that was refused. Enterprise bargaining was perhaps a very minor step in the direction of workplace democracy, one that could be vastly expanded.

The modest recommendations in the Nelson Report, Shared Endeavours (2000) - 45 of them - to encourage broad-based employee share ownership, have hardly been taken up by small and medium-sized enterprises (SMEs). Many Australian unions have a very cautious attitude towards it, but in the UK workplaces with employee share ownership have much higher union membership than those without it!

The Employee Ownership Act in Belgium (October, 2002) was negotiated with the union movement and has the full approval of the unions. In the past the EU itself has been predominantly active with employee participation in decision-making rather than employees owning shares in the business. But the Pepper Reports of the 1990s, recommending ESO, have had a far-reaching impact on new EU directions. Implementing both generally results in much enhanced productivity and employee satisfaction. Australia is 30 years behind Europe and the US on both counts.

Structural change

It is refreshing that Kevin Rudd has acknowledged that the federal structure presents serious public management problems. The remedy is to end federation, nothing less. In July last year all ALP state premiers went to Canada and announced they wanted to form a Canadian-type Council of States, presumably to more effectively counter the Howard Federal Government. But what would happen if the ALP won the federal election?

The growing federal-state problems, now acknowledged by several Coalition ministers, can no longer be fixed by piecemeal tinkering. The answer, surely, is to move rapidly to a two-tier structure: a national government and stronger local government aided by the Regional Organisation of Councils which, in part, is already in place.

This could be described as the mezzanine layer of governance, indirectly elected by and responsible to local government. State governments in metropolitan areas could be replaced by city governments, no longer having responsibilities in rural and regional areas of Australia.

There are important other areas crying out for change, for example, the electoral system. The dominant Australian electoral system is based on single-member electoral districts, which is a hindrance to democratic government and has many other functional disadvantages.

The best solution is to introduce proportional representation, a system in place in over 25 European countries, New Zealand and the new South Africa. This is based on multi-member districts and ensures that parties receive seats in proportion to the votes cast for them.

It is a vastly more democratic system and also ensures much more diverse representation in the Parliaments. Recently proportional representation was advocated strongly by Carmen Lawrence.