Unions and collective bargaining in Australia in 2019

Abstract

Early in 2019, in anticipation of a change in Federal government, the fate of unions and collective bargaining in Australia appeared likely to take a new direction. However, the re-election in May of the Morrison-led Coalition government changed all this. This article reviews the year in three main sections, focusing respectively on unions and union strategy; collective bargaining and collective agreements; and public policy, unions and collective bargaining. Despite some interesting twists, the overall themes are more of the same – the continuation of political partisanship towards unions and collective bargaining, and the reinforcement of adversarialism in the workplace.

Keywords

Collective bargaining cooperation enterprise agreements Fair Work Act industrial disputes union membership unions wages

Introduction

Early in 2019, the fate of unions and collective bargaining in Australia appeared likely to take a very different turn. Reinvigorated by the prospect of the election of a more sympathetic government, unions were advocating a range of legislative changes designed to promote their interests and those of their members and reshape the rules of collective bargaining. These changes, though, did not come. The re-election in May of the Morrison Coalition government reinforced the highly partisan nature of the Australian political system. Substantive anti-union legislation, rejected by Parliament before the election, was re-introduced and the new government pursued further legislative change, albeit in an incremental process rather than the wholesale reform of earlier decades. Within this environment, the adversarialism of enterprise bargaining and workplace industrial relations was confirmed. Moments of co-operation were isolated and vulnerable.

Unions and union strategies

There were no new official data released on union membership during the year, but Australian Council of Trade Unions (ACTU) Secretary, Sally McManus, claimed in February that unions had arrested the decline of membership. ‘I think there’s a point where it won’t go down any further and I think we’ve reached that point’, she said. She went on to argue that ‘people have had enough’ and that ‘unions were seeing membership growth now’ (Workplace Express, 2019b). Unfortunately, she did not provide any data to back up her claim and the effect of the subsequent election on membership levels is uncertain.

Following the creation in 2018 of the Construction, Forestry, Maritime, Mining and Energy Union (CFMMEU), important amalgamations between unions continued. In late 2019, the long process of creating another super-union was completed, when the Fair Work Commission (FWC) approved the amalgamation of the National Union of Workers and United Voice, creating, from 11 November, the United Workers Union (UWU). A former Branch Secretary turned Senator, Jess Walsh, claimed the union would be ‘a critical force in pushing for better job security’ (Workplace Express, 2019r). The UWU claims to represent more than 150,000 workers from more than 45 industries (UWU, 2019), making it the country’s largest blue-collar union. This compares to 275,000 members of the Australian Nursing and Midwifery Federation (2019), which lays claim to being Australia’s largest union.

Harassment, abuse and violence against workers by customers is one issue on which the UWU (through Hospo Voice, part of the former United Voice in Victoria) has been campaigning, through ‘Respect is the Rule’ (Hospo Voice, 2017). This concern is shared with fast food and retail workers in the 200,000-plus-strong Shop, Distributive and Allied Employees Association (SDA, 2019a), which in 2019 launched its ‘No one deserves a serve’ campaign (SDA, 2019b). Data released in 2019 from a survey of 2400 Qantas staff also revealed that ‘15 per cent of cabin crew said they have been harassed by a passenger’ and a quarter of staff were harassed by a colleague, but only 3% had reported it (Patty, 2019a; Workplace Express, 2019s). Of course, these issues are not limited to unionised workforces – an International Bar Association (2019) survey of lawyers in 100 countries revealed that 47% of female respondents reported experiencing sexual harassment at work (p. 87). The #MeToo campaign across the globe has increased awareness of the issues, but changing institutionalised attitudes underpinning this behaviour is a lot more difficult.

Related issues were also part of the entangled stories of John Setka, the CFMMEU, the Australian Labor Party (ALP), and the Australian Building and Construction Commission (ABCC) in 2019. Setka, the Victorian Secretary of the CFMMEU, is a divisive figure. At a time when white-collar and majority-female unions are among the largest in the country, and the ACTU was campaigning to include family violence leave in enterprise agreements, he pleaded guilty in court in June to harassing a woman, just days after his own deputy quit over a difference in ‘values’ (Schneiders and Priess, 2019). These events came after months of speculation on the details of the harassment and associated reports, which Setka denied, that at a closed union meeting he had spoken disparagingly of the work of Rosie Batty, the Australian of Year and campaigner against family violence.

All of this played out against a complex political backdrop. The ALP’s leader, for example, sought Setka’s expulsion from the party for ‘bringing the party into disrepute’ (Napier-Raman, 2019). Setka committed to fight the expulsion, but then resigned his party membership in late October (Schneiders, 2019). The CFMMEU was also a target of the ABCC, which repeatedly imposed penalties for union breaches of industrial law, while the Morrison Coalition government, since its re-election, continued to use Setka as the poster boy for union ‘thuggery’ (Forsyth, 2019), particularly in promoting their ‘union-busting’ Ensuring Integrity Bill (see more below). However, Setka retained support from some within the union movement and its political wing. He has, for these reasons, been a lightning rod for broader social and political debates.

Meanwhile, the Registered Organisations Commission (ROC), established by the Abbott Coalition government and in its third year of operation, worked to establish itself as independent after the office of the then Employment Minister, Senator Michaelia Cash, became involved in a very public raid by the Australian Federal Police in 2017 on the offices of the Australian Workers’ Union (AWU), the then Opposition leader’s former union. The leaking of information about the raid led to a police inquiry over 16 months to February 2019, in which members of the Minister’s office and others were implicated, although no charges were laid (Koziol, 2019). The AWU took legal action against the ROC, claiming the raid was invalid, a view confirmed in a decision of the Federal Court in October (Patty, 2019b). The ROC lodged an appeal in December. The ROC, meanwhile, won a case in the Federal Court against the former Victorian AWU Secretary, Cesar Melham, for ‘membership breaches’ (Workplace Express, 2019u). The RO Commissioner, Mark Bielecki, used the ruling as a reminder that ‘officers’ duties under the RO Act are central to good governance and effective operation of registered organisations’ (Workplace Express, 2019u).

The year saw the death on 16 May of former Prime Minister and ACTU President Bob Hawke (Combet, 2019; Keane, 2019b). Hawke was, of course, a union official before he became a politician in 1982 and, soon after, Prime Minister. His time with the ACTU – first as an advocate (1959–1969) and then as President (1969–1982) – was turbulent, but it was also a time when a stronger union movement achieved many gains for members and workers. But Hawke was also known as a great negotiator, a reputation which carried over to his time in political office. The Accord between the Labor Party and the unions represented one of the few periods in Australia’s history when unions were given access to political power in Australia and when cooperation became a genuine alternative to the traditional adversarialism in industrial relations (see Bray et al., 2017: 32–35). This reflected Hawke’s personal inclination towards ‘consensus’ and deal-making.

Another significant departure during the year was the retirement from the Federal Senate of Senator Doug Cameron, another leading union figure. From the 1970s he was a stalwart of the Amalgamated Metal Workers and Shipwrights Union and its successors (now the Australian Manufacturing Workers’ Union (AMWU)), and Vice President of the ACTU. He was elected in 2007 as a member of the ALP to represent New South Wales (NSW) in the Senate. He spoke up for those suffering the consequences of unequal power in the workplace and an economy in transition (Cameron, 2019; Keane, 2019a).

Wage theft and other employer non-compliance continued to be significant issues, pursued by unions, the Fair Work Ombudsman and through print and social media campaigns (Ferguson, 2019). Stories in hospitality have been particularly egregious. It was reported that, with 7% of the Australian workforce, in 2018–2019 hospitality ‘accounted for 17 per cent of [pay] disputes and 36% of anonymous tip-offs’ received by the Fair Work Ombudsman (Valent, 2019). There was also evidence of wage theft in other sectors, especially horticulture (see e.g. Hatch, 2019; Howe et al., 2019; Powell, 2019). While problems in some organisations were long-standing, union density in these industries is low. Nevertheless, relevant unions are actively supporting and publicising the issues of underpayments and wage theft. Nor is the issue limited to the private sector (see e.g. Community and Public Sector Union (CPSU), 2019). Sharan Burrow, former President of the ACTU and for many years now General Secretary of the International Trade Union Confederation, said ‘wage theft in Australia was among the worst she’d seen in the world … The theft of wages in this country is akin to the kind of conditions we see in countries like the Gulf States where the kafala system [of migrant workers] exists’ (cited in McCauley, 2019). Debate continues federally and in Victoria and NSW about whether and how to criminalise wage theft.

As unions struggled to retain their members and influence, and as the Morrison Coalition government pursued an agenda designed to further weaken them at the workplace and elsewhere, unions and like-minded community groups found common purpose and action in other ways. Unions sought ways to engage with and reflect the values of young people and the broader community on issues such as addressing climate change. Unions and union members were active participants, for example, in the Global Climate Strike (Clark, 2019). They also agitated on the same issue in the ‘boardroom’, through investment decisions made by union-appointed members of industry superannuation funds (Roddan, 2019; Toscano, 2019). Whether these efforts represent a long-term transformation in the role of unions remains to be seen.

Collective bargaining and collective agreement making

Commentators expected a continuation of the decline in the incidence and coverage of collective agreements (e.g. Pennington, 2019; Workplace Express, 2019f). They also expected continued low wage growth (e.g. Letts, 2019; Long and Janda, 2019). The data did not completely support these expectations. This section reviews these data before exploring trends in wages, industrial disputes and collective agreement-making (union and non-union, adversarial and cooperative) across a range of industries.

The incidence and coverage of collective agreements

The overall trend in collective bargaining – specifically the declining number and coverage of collective agreements – continued during the last quarter of 2018, but the first two quarters of 2019 saw increases, at least in the number and incidence of new collective agreements lodged under the Fair Work Act. The source of the data was, as it had been since 1991, the Workplace Agreements Database (WAD), now held in the Attorney-General’s Department (AGD).

This source reported that the number of federally registered current agreements continued the long-term trend (presented in Figure 1): at the end of the March quarter of 2019 there were 10,571 current agreements, the lowest since 1998. This had, however, increased modestly by the end of the June quarter to 11,335. The coverage of current agreements also increased to 2,189,600 by the end of the June quarter – the highest number since 2016 (see Figure 2).

Figure 1.

Number of federally registered agreements, quarterly, current. December 1991–June 2019.

Figure 2.

Number of employees covered by current collective agreements, quarterly, December 1991–June 2019.

An upward trend, which began in 2018, Figure 3 shows continued in the number of new agreements lodged. During the first half of 2019, a total of 2913 agreements were lodged (1330 in the March quarter and 1581 in the June quarter). This was the highest half-year number of new agreements since the second half of 2014. These new agreements covered a total of 563,000 employees (367,700 in the March quarter and 195,300 in the June quarter). As shown in Figure 2, these numbers suggest a (slight) reversal of the steady decline evident since 2010.

Figure 3.

Number of federally registered agreements, annual, approved, June 1993–June 2019.

Figure 4.

Annual increase in Wage Price Index, calculated ending September quarter, 1998–2019.

It would be easy to exaggerate the recent upward trajectory in new agreements. It does, however, suggest that something was going on in late 2018 and early 2019! One proposed explanation was the clearing of a backlog of applications awaiting approval by the Fair Work Commission (FWC) allegedly due to ‘inefficiencies’ and ‘technical barriers’ in the system (e.g. Marin-Guzman, 2019a;Workplace Express, 2019f). Several observers used this argument to advocate legislative changes to the Better Off Overall Test (BOOT). The FWC’s president acknowledged the problem but explained it as the result of a big rise in the proportion of ‘non-compliant’ applications requiring further undertakings (having increased from 35% in 2016 to 66% in 2019) – a situation resolved by the FWC during 2019 (FWC, 2019f: 6–7).

Part of the rebound in collective agreement numbers and coverage is also attributable to events in specific industries, such as the resurgence of collective agreement making in the retail industry. After the expiry and/or termination of many collective agreements associated with the previously flawed application of the BOOT, the SDA has been renegotiating new and very large agreements with major retailers (see below); for example, 30 new retail agreements lodged in the March quarter of 2019 covered 122,500 employees (AGD, 2019b). Two other industries that figured prominently in the 2019 WAD data were Education and Training, and Health Care and Social Assistance, whereby both saw solid increases in the number and coverage of new enterprise agreements. In this way, the increases occurred in both the private and public sectors.

The significance of trends in the incidence and coverage of collective agreements needs to be put in perspective: despite the increases seen in some numbers, they represent only a slight rebound and collective agreements remain at historic lows. Moreover, it remains to be seen whether this short-term increase will continue.

Wage outcomes

The later months of 2018 had seen some indications that wage growth was increasing after a sustained period of historic lows. The available data for 2019, however, suggest that wages growth generally has ‘flatlined’ (Wright, 2019) and there are certainly no signs that wages through collective agreements were leading the way.

In the year to September 2019, the seasonally adjusted Wage Price Index (WPI) rose 2.2% (Australian Bureau of Statistics (ABS), 2019a), shown in Figure 4. This compares with increases of 2.3% and 2.0% over the same periods for 2018 and 2017, respectively. The slight slowing in the rate of increase in the Consumer Price Index (1.7%) over the same 12-month period suggested a small increase in real wages (ABS, 2019c).

As usual, wage increases through collective agreements continue to be higher than the generalised numbers reported in the WPI, but they are not increasing much faster than the WPI. The September quarter 2018 increase of 3.2% for new agreements proved to be an aberration, and the average annualised wage increase in both newly approved and current enterprise agreements subsequently remained stubbornly low at 2.7% (AGD, 2019b). Private-sector agreements and agreements covering unions delivered slightly higher wage increases than those in the public sector and those not covering unions (AGD, 2019b).

Ever witty, Crikey commented:

Want a decent pay rise? Get into health, move to Melbourne and join a union. Otherwise, you can look forward to years of wage rises being barely above inflation. (Keane and Dyer, 2019)

There continued to be debate about the causes of Australia’s low wage growth, with significant disagreement in particular about the role of unions and collective bargaining. A paper released by the Reserve Bank of Australia (RBA) in April (Bishop and Chan, 2019), for example, argued that the decline in union membership over recent years has not reduced union power in collective bargaining and therefore cannot explain declining wage growth. This view was greeted with some enthusiasm by conservative commentators (e.g. Stutchbury, 2019). However, the RBA’s interpretation was criticised by the Centre for Future Work:

With its very misleading empirical description of trends in EA coverage, its unconvincing description of union wage effects, and its failure to think through the consequences of unconstrained free-riding, the Bishop-Chan paper has promoted more confusion than illumination of this important trend. (Pennington and Stanford, 2020: 18)

Industrial disputes

In the year to June 2019, industrial disputes, as reported by the ABS (2019b), increased slightly compared to the previous year, but generally re-affirmed the long-term trend (presented in Figure 5) of very low levels of disputation. There were only 170 industrial disputes in Australia over the 2018–2019 year. This was marginally more (by 3.7%) than the previous year (164 disputes) but remained below the average for the previous decade. These disputes involved 112,500 working days lost, which is 2.2% more than those reported for the same period the previous year. The total number of employees involved in disputes was 66,000, which was again more than the previous year’s total of 41,000 employees. At the same time, industrial disputes in 2019 were slightly shorter and involved slightly more workers. On average, they lasted for 1.8 days (compared with 2.2 days in 2018 and 1.9 days in 2017) and involved 390 workers (compared with 250 workers in 2018 and 490 workers in 2017).

Figure 5.

Industrial disputes, year ending June quarter, 1985–2019.

A selection of industry developments

The retail and fast food industries saw both continued court and tribunal activity and a number of new collective agreements approved during 2019, as the SDA sought to re-negotiate enterprise agreements with major retail and fast food employers. The legal issues and the large numbers of workers covered by these agreements make them especially important nationally. The Woolworths Supermarket Agreement, for example, covering nearly 100,000 employees, was approved in January (FWC, 2019a). It was, however, subject to a further appeal, apparently motivated by the long-running attempts by the unregistered industrial association Retail and Fast Food Workers Union (RAFFWU Inc) to terminate the retailer’s 2012 enterprise agreement and pursue back pay for employees (Workplace Express, 2019a, 2019e). This appeal was dismissed in May (FWC, 2019b) and the approved agreement was implemented.

Other large agreements to be successfully renegotiated and approved by the FWC in 2019 included those with Big W, BWS, Dan Murphy’s and the Just Group. A particularly significant agreement, also subject to delays resulting from RAFFWU intervention, involved Kmart. After it was supported by 92% of the 21,191 employees participating in the ballot, the FWC refused to approve it on several grounds, including the composition of eligible voters and choice of superannuation funds. The non-approval was, however, overturned by a full bench of the FWC in November (Workplace Express, 2019t), paving the way for approval subject to appropriate undertakings by the employer.

Two employers with which the SDA was unable to agree were Pizza Hut and McDonalds. In the former case, the failure of negotiations led to union members and other employees returning to the Fast Food Industry Award 2010 (Workplace Express, 2019a). The McDonalds case was different, but the outcome may be similar depending on the result of applications to terminate the expired 2013 McDonald’s agreement, which were before the FWC at the time of writing (Workplace Express, 2019n, 2019v).

Negotiations between Alcoa and the AWU over a new enterprise agreement covering five sites in the Western Australian alumina industry, which were reported in last year’s review (Bray, Macneil and Spiess, 2019: 368), continued with equal drama during 2019. After 2 years of negotiations, an extended strike and failed ballots for proposed enterprise agreements (EAs), the company’s application for the termination of the agreement was accepted by the FWC, but the AWU appealed. While this was in process, Alcoa withdrew a long-standing practice of paying the salaries of full-time union delegates on site in January (Hondros, 2019). and in March employees rejected for a third time an agreement proposed by the company (McKnight, 2019a). The union’s appeal about the agreement’s termination decision was upheld in April, obliging the Commission member to re-determine the case. The Commission member’s approach to the redetermination was, however, subject to a second appeal by the AWU, which was again upheld in June. The parties continued to negotiate, and a ballot over yet another collective agreement was finally accepted by 73% of the workforce in early November (McKnight, 2019b).

The federal public sector continued to see centralised constraints imposed by the government and the Australian Public Service Commissioner (APSC). In particular, the ‘Workplace Bargaining Policy 2018’ (APSC, 2019) dictated a cap on annual wage increases of 2% if substantial changes in conditions were not forthcoming. The frustration with this approach among unions and workers, many of whom saw extensive periods without any wage increases in the previous bargaining round, led them to adopt a different strategy: where the majority of members in an agency supported it in a ballot, rather than engaging in fruitless negotiations and attempts by agency managers to make serious inroads on conditions, the CPSU sought the use of Determinations under section 24 of the Public Service Act 1999. These provisions allow an agency head to determine the ‘terms and conditions of employment’, provided they do not reduce the benefits to employees contained in a ‘fair work instrument’.

By July 2019, it was reported that 25 such Determinations had been made: 15 in 2018 and a further 10 in 2019 (Dingwall, 2019a). By early November, the number had increased to include several of the largest departments in the public service, with each essentially rolling over current EAs (for 3 years) with an annual 2% wage increase. One commentator characterised this as staff ‘choosing between pay rises and bargaining’. The same account quoted the APSC as saying ‘the government’s bargaining rules gave the agencies and their employees flexibility to choose the best arrangement that suited their needs’ (Dingwall, 2019b).

Cooperative collective bargaining

Given the adversarial nature of most industrial relations in Australia, cooperative bargaining – especially using interest-based methods – remains relatively rare and mostly unpublicised. The advent of the FWC’s New Approaches (NA) programme in 2014, however, provided a framework within which parties seeking cooperation can work (for background, see Bray et al., 2017). Applications for intervention by the FWC within this framework are voluntary and must be supported by both ‘sides’ (see FWC, 2019f: 80). Since the previous year’s annual review, there have been 15 NA files commenced – 2 in late 2018 and 13 during 2019 (up to 19 November). These bring the total number of NA files since 2014 to 83, with a number of the pre-2019 files remaining open.

One example of a successful NA file during 2019 involved TransDev, which employs over 1000 drivers in Perth on buses contracted to the Western Australia (WA) government, and the Transport Workers’ Union, which represents employees of the company. The previous enterprise agreement expired at the end of June 2018 and, in October through to March the following year, drivers took industrial action (Luff, 2018; see also Barry, 2018). TransDev claimed they could not give ground because any increased labour costs were not covered under a tight contract with the WA government (Interview 1). Both sides dug in and the matter remained unresolved. In March 2019, management proposed the use of interest-based bargaining facilitated by the FWC and the union agreed, accepting a need to try something different. The FWC member provided training and then chaired eight full-day negotiation sessions, in which management shared greater information with unions and genuine exchanges occurred as trust gradually grew. The end result was novel: an incentive scheme (see clause 10 of the agreement) whereby any benefits realised as the result of improved performance (like reduced costs from accidents and penalties imposed under the contract for late departures or missed trips) are shared equally between the company and workers. Management attributed this unanticipated arrangement to the creativity released by the interest-based process. The enterprise agreement was supported in an employee ballot and approved by the FWC in September (FWC, 2019e).

A second example of more cooperative bargaining involved the McArthur River Mine and its employees, partially represented by the AMWU. The Northern Territory mine operated with a total workforce of around 1000, although only around 230 employees were covered by the enterprise agreement, which expired in April 2017 (Interview 2). In the context of the end of the mining boom, management sought significant changes, but the (largely non-union) workforce resisted. One proposed agreement received little support (16%) in June 2018 and relationships became difficult. Management proposed FWC facilitation under NA in August and workforce and union representatives agreed. Three members of the Commission became involved in training and then the chairing of interest-based negotiations in Darwin in late 2018 and early 2019. The new agreement was accepted with 69% support in an August ballot of employees and approved by the FWC on 11 September (FWC, 2019d). Management praised the process, saying it:

allowed the underlying issues to be explored in much better depth in a more cooperative manner than traditional bargaining had enabled. This in turn led to the development of solutions that would not have been possible but for the interest-based process. More importantly, whilst bargaining took its usual “twists and turns”, any slide toward unconstructive conflict was arrested and reversed. (Correspondence, 2019)

The union was less impressed, although it recognised that it at least ‘got management moving’, and it accepted that most employees were not union members and that many members supported the process and the outcome (Interview 3). It felt they could have achieved more, especially on the wages front, through more traditional bargaining. The union refused to support the final agreement and did not apply to be covered by it.

Non-union collective agreement making

An indication of trends in the incidence of non-union collective agreements (NUCAs) – setting aside the question of whether union ‘coverage’ of agreements represents an accurate measure – comes from the WAD (AGD, 2019a). This broadly showed that NUCAs enjoyed a rebound in recent months similar to that of collective agreements in general.

This is especially obvious with new agreements, where the number and coverage of newly approved agreements increased significantly in the first two quarters of 2019 (AGD, 2019b: Table 13). Annualised data comparing the 2017–2018 and 2018–2019 financial years show that the number of new NUCAs increased from 920 to 1157, although both represented about one-quarter of all new agreements. Coverage, however, remained low at 4% (30,800) in the earlier period and 5% (39,400) of all enterprise agreements in the later period, again demonstrating that non-union agreements are smaller than their union counterparts.

The data on current agreements offer a slightly different picture: both the incidence and coverage of NUCAs declined between the two most recent financial years: by 11% in number and 20% in coverage. At the same time, however, these declines also occurred in union agreements. So NUCAs remained at 34% of all agreements in both periods, while current NUCAs only fell in coverage from 8% of the total to only 6% (AGD, 2019b: Table 14).

Both new and current NUCAs consistently operate for a longer duration than union agreements (e.g. 3.4 years compared to 2.8 years for new agreements in the June quarter of 2019) and they deliver lower wage increases than union agreements (e.g. 2.5% in current NUCAs at the end of the June quarter of 2019 compared to 2.7% for unions’ agreements). These apparent – but highly aggregated – differences became the subject of a narrative advanced during the year by the Centre for Future Work. Pennington (2019) argued that the implementation of employers’ post-election demands for legislative reforms could lead to a return to Work Choices levels of NUCA-making and a further decline in wages and conditions. Employers and the government have remained silent on the issue of NUCAs.

One of the more controversial features of NUCAs was exposed in 2019 through tribunal cases involving Mechanical Maintenance Services, a labour hire company operating in power stations in Victoria’s La Trobe Valley (FWC 2019c). The CFMMEU discovered quite late in the process that the company was moving away from its original union greenfield agreement and had lodged for approval a new NUCA ‘negotiated’ with just five employees, none of whom were union members and most of whom stayed with the company for a very short period. The company subsequently won contracts in the power stations and used the agreement for much larger numbers of employees. A series of decisions by a single Commission member and successful appeals to a full bench (Workplace Express, 2019o, 2019p) eventually saw the agreement approved in December (FWC, 2019g; Workplace Express, 2019x). According to the CFMMEU, this type of ‘small cohort’ non-union agreement (see Chaudhuri and Sarina, 2018: 149–160) was increasingly common in the construction and mining industries (Interview 4).

Public policy, unions and collective bargaining

Union protests about the defects of Australia’s collective bargaining system were just one part of a broad campaign, which built as the May election became closer. Publicity in March about self-styled ‘political protests’ planned by the ACTU produced reactions from regulatory bodies (specifically, the ABCC), threatening sanctions against workers who absented themselves from work in order to attend. There were also public statements from employer bodies such as the Australian Industry Group (AiG) that the ACTU ‘deserved widespread condemnation’ for organising rallies that would be ‘bad for investment and bad for jobs’ (Workplace Express, 2019d). In April, the biggest of these protests claimed 100,000 people in attendance (Workplace Express, 2019g). The unions also commenced a ‘boots-on-the-ground’ campaign of door knocking and other activities in 15 marginal seats (Workplace Express, 2019h) and then a series of video advertisements, to be placed across a range of media outlets (Workplace Express, 2019j).

The Labor Party gradually released more policies, including support for a living wage, the restoration of penalty rates, sector-wide collective bargaining in the federal public service, and a new low-cost small claims tribunal to sit alongside the FWC. However, the Labor leader, Bill Shorten, also sought to hose down expectations and soften the message for employers on several occasions by invoking the spirit of Bob Hawke and the Accord (Workplace Express, 2019c, 2019k).

In contrast, employers and the Coalition were largely silent on industrial relations and collective bargaining throughout the campaign. Kaine and Wright (2019) called it a ‘small target’ approach. Although rarely raised publicly, the Coalition government planned, if they were returned, to reintroduce the bills they had failed to get through Parliament (Workplace Express, 2019i). But there was little more. In an interview a week before the election, Mr Morrison said his government would:

… not be adopting any further changes to the industrial relations system, as are advocated by leading business groups, should he be re-elected on May 18.

Mr Morrison said the party had learned the lesson from the 2007 election, the same election he entered politics, when John Howard was punished for introducing WorkChoices, a significant deregulation of the workplace relations system.

“They haven’t made the case for that,’’ he said of calls from such groups as the Business Council of Australia for more IR reform.

I remember 2007. I remember it well. And, so should they. (Coorey, 2019a)

When the Coalition did say anything about future policy, it was anti-union and characterised by a sustained attempt to link the unions with the ALP. The Liberal Party ‘Election Policies’ website listed 37 election policies, none of which focused specifically on industrial relations, the only mention of which came under two headings, the first of which was ‘A Stronger Manufacturing Sector’: ‘Labor’s workplace relations policies will put the unions back in charge while its trade policy will give trade unions a veto over our trade negotiations’ (Liberal Party, 2019a).

The other mention came when this theme was expanded and exaggerated, under the heading of ‘More Jobs in a Stronger Economy’:

Labor would also completely change the rules of industrial relations. Labor has already promised to impose industry-wide strikes, allow politicians to interfere with pay decisions, tear up enterprise bargaining, give union bosses the upper hand in negotiations, give unions the power to pilfer workers’ entitlements held in accounts they control, exempt union-run industry super funds from tax hikes, impose a union veto on trade agreements and restrict backpacker work visas that help our farming sector. This alone will hurt jobs and the economy. And who knows what other changes former union leader Bill Shorten would make to keep militant union bosses happy. (Liberal Party, 2019b)

Employers – and only slightly less so, employer associations – were conspicuously silent in public, although they were reported to be privately unhappy with the bargaining regime and even fearful of an ALP victory. A survey of employers released by a law firm in March, for example, found that employers were taking more time negotiating enterprise agreements and more were operating on agreements beyond their expiry dates (Workplace Express, 2019f). Another report claimed that employer silence was caused by a fear of retribution and that ‘the biggest single fear among business is industrial relations – they see Opposition Leader Bill Shorten as being captive to unions and are concerned about a rise in their power and break-outs in wages and conditions’ (Knight, 2019).

The election result changed the dynamics of public debate completely.

Two days after the election, Workplace Express said that the re-election of the Morrison government ‘left unanswered questions over its workplace relations agenda for the next three years’, but it also reported that employer associations were already advancing their reform preferences, including the reintroduction of the Ensuring Integrity Bill and ‘simplification’ of enterprise bargaining (Workplace Express, 2019l).

In June, Prime Minister Scott Morrison announced a review of Australia’s employment relations laws, to be led by the Attorney-General and Minister for Industrial Relations, and called on employers to make the case for change (Crowe, 2019). Early in his tenure, the new minister ‘singled out the ailing enterprise bargaining system as one of his priorities, highlighting the need to reduce ‘“complexities” in the way of agreement-making’ (e.g. Workplace Express, 2019m). In early September, ACTU Secretary Sally McManus began to voice the unions’ concern that business was dominating the government’s agenda and consultation programme (Workplace Express, 2019q).

There was never any doubt that the government would seek to win support from the new Senate for the Ensuring Integrity and Worker Benefits bills, which had failed in the previous Parliament and had been referred to separate Senate inquiries. The former bill was re-introduced and passed by the House of Representatives in July (see Parliament of Australia, 2019). It was an unambiguously anti-union piece of law (Forsyth, 2019) and received a huge amount of publicity. It was also the subject of a major campaign by the unions. The government made late amendments to the bill in order to gain the support of the all-important Senate cross-bench members. However, in late November, the bill was unexpectedly defeated (Worthington and Greenbank, 2019). The government almost immediately re-introduced the bill and its fate will be determined in 2020 (Workplace Express, 2019w).

In the meantime, Minister Porter made a speech in September outlining the government’s approach to labour law reform (Porter, The Hon., 2019). This was an important strategic statement by the government. He said that rather than seeking ‘big bang’ changes to the Fair Work Act, they would progress slowly, piece by piece. Moreover, each area in which they planned change would be preceded by a Discussion Paper and consultation with stakeholders.

This was all presented by the minister in balanced language:

So much of the contestability in this area has arisen from the simple but mistaken view that the industrial relations system is a contest. A false view in my observations – that the IR system is a perpetual contest between employers and employees. There is probably no other area of economic/legal policy where the zero sum game conception is less reflective of the actual real world facts … (Porter, The Hon., 2019)

Still, the partisan nature of the exercise – and of Australian politics more generally – was apparent. The minister did not observe the irony of his attack on what he called the ‘radical’ approach of the unions and the Labor Party at the same time he was calling for consensus (Porter, The Hon., 2019).

The first two examples of the government’s ‘incremental’ reform process were identified as penalties imposed for various forms of misconduct (AGD, 2019c), and the duration of ‘greenfields’ enterprise agreements. The latter progressed quickly. One month after the release of the greenfields discussion paper, the minister announced that ‘the response had been so positive the government would proceed with legislating the change’ (Coorey, 2019b). The intention was that legislative amendments would be introduced early in 2020 to allow greenfield projects to be covered by collective agreements that lasted the entire life of the project.

In December, a surprise third discussion paper appeared focusing on ‘cooperative workplaces’, calling for submissions from interested parties by the end of February 2020 (AGD, 2019c). Given the issues raised in the Discussion Paper (Bray, Macneil and Stewart, 2019), the rapid support received from employers (Marin-Guzman, 2019b) and the government’s general approach towards industrial relations, this appears to be an exercise focused exclusively on management practices rather than an attempt to improve relationships with unions. But time will tell.

Conclusion

The federal election marked the turning point in the year’s developments for unions and collective bargaining. Before it, unions and the Labor Party became increasingly confident that the long-term decline in the fortunes of unions and collective bargaining was slowing. The re-election of the Coalition, however, merely brought more of the same. The highly partisan nature of Australian politics and industrial relations, which were reaffirmed by the election outcome, meant continued, if not increased, pressure on unions and a regulatory framework for collective bargaining that is likely to be improved in ways that assist employers. The practice of collective bargaining saw some minor bright spots for its advocates, in the form of modest increases in some indicators of incidence and coverage and some successes for cooperative bargaining. However, it remains to be seen whether these represent a temporary bubble or the beginnings of some more permanent recovery.

Footnotes

Declaration of conflicting interests

The author(s) declared no potential conflicts of interest with respect to the research, authorship and/or publication of this article.

Funding

The author(s) received no financial support for the research, authorship and/or publication of this article.

Biographical notes

Johanna Macneil is a Professor and Assistant Dean in the Faculty of Business and Law at The University of Newcastle, and is part of the Employment Relations and human resource management discipline. She has long-term applied and academic interests in cooperative change at work, collective bargaining, and soft regulation of industrial relations.

Mark Bray holds the Foundation Chair of Employment Studies at The University of Newcastle. He teaches Australian and comparative industrial relations, and industrial relations theory. His research interests include cooperation at work, the role of industrial tribunals, collective bargaining and awards.

Leslee Spiess completed her PhD in the Newcastle Business School at The University of Newcastle. She currently teaches comparative employment relations systems and her research interests include the structures and processes of labour regulation, management strategy and employee representation.

ORCID iDs

Johanna Macneil

Mark Bray

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