WorkChoices - not so good: Fair Work Australia - frightening!

Labor’s plan indicates it would also legislate to forbid industrial action during the life of an agreement and action in support of an industry wide agreement (the so-called pattern bargaining), as well as requiring a secret ballot to initiate allowable industrial action. How this would work out in practice would depend importantly on the detail of the legislation and the discretion given to Fair Work Australia, which “will have the power to end industrial action and determine a settlement”. As with some other elements in Labor’s plan, this seems to establish a de facto form of compulsory arbitration.

Even more concerning though is Labor’s plan to allow union bargaining demands over “any matter”, paving the way for strikes over any subject matter contemplated by union officials without even a connection being required to wages and conditions of employment.

Labor has agreed, however, to retaining the outlawing of secondary boycotts as part of the Trade Practices Act rather than the legislation governing workplace relations.

Conclusion

Whichever party is elected the outcome on workplace relations will be retrograde because it will maintain unwarranted restrictions and further reduce the capacity of employees and employers to themselves determine the major components of employment agreements. The effects on employment are likely to be adverse, particularly when the economy slows.

However, from the information available, Labor’s policies are truly frightening. The possible return to power of the AIRC for the transitional period to 2010 and the passing to that body of the review of the award system (which I have discussed in the Spring edition of Policy), would itself create considerable uncertainty assuming the Senate passed the necessary legislation.

If the Senate then approves legislation to authorise the FWA to start operating from January 2010 that would likely further add to uncertainty by establishing an environment conducive to a major increase in the exercise of union power and to inflationary wage increases. That would occur in circumstances where the FWA would likely have the most extensive set of regulations ever stipulated in legislation giving it, in turn, by far the most extensive ever interpretive and decision-making role. Moreover, with the backing of many millions of budgetary dollars, these regulations and decisions would likely be strictly enforced by an arm of the FWA that would inherit an industrial police force.