Employment Relations in Australia: Four ER Issues

1. Trade Unions in Australia

(a) Introduction

                (b) Purpose

                (c) Membership

                (d) Structure

                (e) Strategy

 (a) Introduction

•          Trade unions have a long history in Australia
… going back to the middle of the 19^th century

•          Strong British heritage

•          Australia had an international reputation for most of the 20^th century for strong unionism:

→   High membership

→   Political power

→   Industrial power

•          But major decline in membership and
power during 1990s and 2000s
… mean that this reputation no longer corresponds
with reality

(b) Purpose

•          The purpose of Australia unions has always
been contested
... in other words, different unions had different visions of their role

•          The majority of unions have accepted the necessity of capitalism
... and seen their role as working within the system
to advance the interests of (a) their members and
(b) workers generally

•          A small minority of unions have been more
radical, seeing their goal as the overthrow
of capitalism
... these unions have become rare since the 1980s

 (c) Membership

•          For much of the 20^th century, around half of all Australian workers were union members
... see Table 7.4 on page 210 of Bray et al. (2009)

•          The decline in union membership since the late 1980s has been dramatic!            1990 → 41%
                                                                1995 → 33%
                                                                2000 → 25%
                                                                2005 → 22%
                                                                2009 → 20%

•          Why? How can this be explained?
Many reasons → see Bray et al. (2009, pages 212-18) and Griffin & Svensen (2002, pages 34-5)

•          There are major differences in union density in different industries

 (d) Structure - External

•          Like their British counterparts, the earliest Australian
unions were a specific type of occupational union:
craft unions: unions of skilled manual workers, like stonemasons, carpenters, engineers etc

•          Later in the 19^th century, occupational unions of less skilled workers emerged
eg. dock workers, trolley & draymen…

•          There were some attempts at industry and general
unions,
... but they were rarely successful

•          This strong emphasis on occupational unions
weakened over subsequent decades, as there
were many mergers and amalgamations

•          As a result, today’s union movement in Australia is a messy mixture of union types

Affiliations of unions with political parties

•          Most Australian unions are affiliated with the Australian Labor Party

•          Indeed, the unions founded the ALP in the 1890s

•          There are still strong organisational links between the unions and the ALP

•          Unions try to use these links to gain the political policies and laws they want

•          But the relationship is complicated!

Inter-union affiliations of unions

•          Unions join together to create federations at different levels:

–        ACTU at national level (established 1920s)

–        Unions NSW at state level (formerly NSW Labour
Council, established 1871)

–      Newcastle Trades Hall at regional level (established 1869)

 (e) Strategy

Mutual Insurance:

•          Very common today (eg. legal advice, home loans, access to discounts),
... but quite different to historical forms of mutual insurance

Unilateral regulation:

•          Rare these days, mostly historical

Collective Bargaining:

•          Important and highly preferred, but it is only effective if unions have bargaining power

•          So, it is strong unions that favour collective bargaining

•          How important are militancy and strikes?

Legal Enactment:

•          Aims to get both procedural and substantive rules that
are legally-binding

Where does reliance on compulsory arbitration fit in?

2. Minimum Wage Regulation

(a) Introduction

                (b) Purpose

                (c) Rule-making process

                (d) Coverage

                (e) Enforcement

 (a) Introduction

•          Very long history in Australia

•          Complicated story because:

–        federal system of government, in which both federal and state parliaments have legislated for minimum wages

–        the unusual role of compulsory arbitration

–        Many changes over time in the way minimum wages were regulated

•          We will concentrate on the period after 1993

•          In 1993, the Australian ER system changed from being based on compulsory conciliation and arbitration to one based on collective bargaining

•          As part of this, federal legislation established a ‘safety net’,
… which was designed as the absolute minimum wages and conditions below which no worker could legally be paid!

•          This safety net comprised two elements:

–        Federal Minimum Wage
… which was a single hourly wage rate designed as the lowest wage rate legally permissible in the federal system
→ this is very similar to the minimum wage in other countries!

–        Awards
… which contain minimum wage rates (as well as many other conditions of employment) for workers in particular jobs, industries and occupations
 → this is very different to other countries!

•          There are also awards in the state systems

•          This means that Australia has thousands of minimum wages rather than just one!

•          Fortunately, all these minimum wages are usually (but not always!) adjusted at the same time… through the same process

 (b) Purpose

•          the purpose of minimum wage regulation has changed over time

•          In the early decades of the arbitration system, the 1907 Harvester Case led to minimum wages being considered a ‘living wage’
ie. it was designed to ensure that all workers, irrespective of their skills, received a wage greater enough to support a man, wife and three children

•          At different times, however, minimum wages were adjusted according to the economy’s ‘capacity to pay’
… which reflected a purpose of using minimum wages as an
economic tool in managing the economy

•          After 1993, safety net wages were even adjusted
in an effort to encourage bargaining between
employers and employees/unions above the
minimum!

 (c) Rule-making process

•          A distinguishing feature of minimum wages in Australia has always been that parliaments and governments did not set minimum wages

•          Rather, they delegated minimum wage regulation to industrial tribunals

•          These tribunals have invariably performed other ER functions as well as minimum wage regulation
…eg. conciliation and arbitration of dispute settling, both individual and collective

•          The details of the procedures followed by the
tribunals in setting minimum wages have varied
over the decades

•          Currently, the Minimum Wage Panel of Fair Work Australia undertakes Annual Wage Reviews
… to see a summary of the current procedures go to:
http://www.fwa.gov.au/index.cfm?pagename=minabout

•          The most recent Annual Wage Review was in June 2010
… to see the decision, go to:
http://www.fwa.gov.au/sites/wagereview2010/decisions/2010fwafb4000.htm

•          The next Annual Wage Review will be completed in June 2011
… all the details of how the procedure operates, the research and submission made by all parties etc can be seen at:
http://www.fwa.gov.au/index.cfm?pagename=wagereview2011&page=introduction

 (d) Coverage

•          Today, the Federal Minimum Wage and award wages (together) cover a very high percentage of workers in Australia
… perhaps 80% of all Australian workers               

•          Those excluded include:

→   Public-sector workers in the state systems

→   High-income workers and managers

→   Managers

•          This does not, however, mean that 80% of Australian workers have their wages determined by awards and the Minimum Wage
… because most workers bargain with the employer (either collectively or individually) over wages that are above the minima

•          It is mostly low-paid workers who have their wages determined by awards and/or the Minimum Wage

•          This means the number of workers relying on awards varies a lot across industries and occupations

 (e) Enforcement

•          The system for enforcing minimum wages in Australia has changed many times over the decades

•          It has always involved some combination of three processes:

→   Government inspectors

→   Trade unions

→   Individual workers initiating litigation

•          All of these parties have the legal right to prosecute for breach of award standards

•          The current government inspectorate is the Fair Work Ombudsman
see: http://www.fairwork.gov.au/Pages/default.aspx

How effective is all this?              

3. Equal Employment Opportunities in Australia

(a) Introduction

                (b) International Standards and the Federal System

                (c) Anti-Discrimination Laws

•          History

•          Types of Discrimination that are Prohibited

•          Coverage

•          Enforcement

                (d) Affirmative Action

                (e) Equal Pay

                (f) Paid Maternity Leave

 (a) Introduction

•          Legislation by Australian governments against discrimination and promoting EEO are relatively recent
… they really only began in the late 1960s and 1970s!

•          They have taken various forms:

→   Anti-discrimination

→   Affirmative action

→   Equal pay

•          They have also focused on many different forms of discrimination, … including race, marital status, gender, age, disability, sexual preference etc

•          Until quite recently, most government intervention has been outside the mainstream ER system,
… in separate laws and institutions

It is a very complicated story, partly because it unfolds at both federal and state levels,

(b) International Standards and the Federal                       System

•          The Australian Constitution did not specifically give the federal parliament the power to make laws in this area,
… so the earliest laws were passed by state governments, and
… state laws and institutions are still important

•          Federal laws, especially gender discrimination, rely on the ‘external affairs’ power of the Constitution

•          For example, the federal parliament’s power to pass the Sex Discrimination Act 1984 (Cth) came from Australia’s ratification in 1983 of an international treaty:
… the United Nations’ Convention on the Elimination of Discrimination Against Women (CEDAW)

                [see Charlesworth & Charlesworth 2004]

•          Rees et al. (2008: pp. 3 and 16-22) also argue that US and UK laws were important influences on Australian EEO laws

 (c) Anti-Discrimination Laws

•          Australia’s laws prohibiting discrimination began with state laws:

→   Legislation in 1966 in South Australia, which made discrimination on the grounds of race a criminal offence
… this was later changed to focus on discrimination as a civil offence

→   Other states followed the civil model in the 1970s and 1980s

•          There have been four main Federal laws:

→   1975 Racial Discrimination Act (Cth)

→   1984 Sex Discrimination Act 1984 (Cth)

→   1992 Disability Discrimination Act (Cth)

→   2004 Age Discrimination Act (Cth)…

•          The grounds for discrimination in these federal laws are clear from their titles

•          Despite conforming to the same general model of regulation,
the various state laws differ considerably on the grounds for discrimination (see Stewart 2009, p. 245)

Characteristic	NSW	Vic	Qld	WA	Tas	ACT	NT
Parental status		ü	ü	ü	ü	ü	ü
Carer/family responsibilities	ü	ü	ü	ü	ü	ü	ü
Breastfeeding	ü	ü	ü		ü	ü	ü
Physical attributes		ü
Political belief or activity		ü	ü	ü	ü	ü	ü
Religious belief or activity		ü	ü	ü	ü	ü	ü
Industrial/union activity		ü	ü		ü	ü	ü
Employment activity		ü
Criminal record				ü	ü	ü	ü
Medical record					ü		ü

•          The coverage of Australian anti-discrimination laws (ie. federal and state combined) is comprehensive,
… but with some exemptions which lead to criticism
(eg. Charlesworth & Charlesworth 2004, pp. 863-4)

•          The federal sex discrimination laws do not apply to religious organisations

Despite diversity across jurisdictions, the usual enforcement process is:

1. An individual employee makes a complaint of unlawful discrimination to a statutory agency…
   eg. federal = Australian Human Rights Commission
          NSW  =  President of the Anti-Discrimination Board
2. The agency investigates and attempts to settle by conciliation
3. If not resolved, complaint can go to formal hearing before a tribunal, but this must be initiated by the individual complainant
   eg. federal = Federal Court or Federal Magistrate’s Court
   NSW = Administrative Decisions Tribunal…
4. If complaint found to be proven, then remedies are imposed
   such as compensation, requirement to hire or reinstate complainant, restraining respondent from repeating unlawful discrimination etc…
1. A key issue in enforcement identified by many commentators is that the Human Rights Commission has no powerful to initiate litigation itself!
   … ie. it is a very individualistic model, in which the individual complainant must take action
2. This is an important weakness of the Australian model
   … and a key difference compared to other national models, like the US and UK
3. Note, however, that the Fair Work Act of 2009 opened up a new possibility in enforcement
   … because it allows the Fair Work Ombudsman to initiate action against employers who practice discrimination (see Smith 2010)

 (d) Affirmative Action

•          Affirmative action differs to anti-discrimination because it seeks to take positive action to reverse past discrimination
… rather than relying on the enforcement of a negative right not to be discriminated against!

•          There have been attempts by federal governments to implement affirmative action,
… but it has fallen foul of differences between political parties

•          The Labor government led by Bob Hawke passed the Affirmative Action (Equal Opportunity for Women) Act in 1986

•          This was amended and watered down by the  Equal Opportunity in the Workplace Act introduced by the Coalition government led by John Howard in 1999

•          The 1999 Act makes modest demands on employers with respect to affirmative action:

•          Private sector organisations with more than 100 employees and public sector organisations must produce a report/plan,
… which includes a workplace profile, analysing equity issues for women, identifying priority issues and taking actions, and evaluating the effectiveness of these actions

•          Report these plans to the Affirmative Action Agency annually (although annual reports can be waived)

•          Weak penalties for non-compliance

•          Only real sanction is ‘naming and shaming’ in parliament and ineligibility for some government contracts

 (e) Equal Pay

•          Australia has a long history of action on equal pay for
men and women
…eg. NSW the first state to legislate for equal pay in 1958

•          And its was not just action by governments
… the early focus of equal pay campaigns by women’s groups and unions was the arbitration tribunals through ‘test cases’

•          This was moderately successful in eliminating the more obvious forms of discrimination in pay and in reducing the gap between men’s and women’s wages,
… because these test cases provided a centralised mechanism to reduce the gap

•          But the more subtle forms of discrimination remain
… and there are still efforts being made today under the FWA (see Baird & Williamson 2010)

•          Statistics on the gap between men’s and women’s earnings:
http://www.eowa.gov.au/Pay_Equity/Files/PE_STATS.pdf

 (f) Paid Maternity Leave

•          Paid maternity leave is usually considered an essential element of any nation’s efforts towards eliminating gender inequality

•          For many years, Australia was exceptional amongst developed economies in not having laws about paid maternity leave

•          Instead, there were legal provisions for unpaid maternity leave

•          After much struggle and controversy, a paid maternity leave scheme (funded by the government) was introduced in 2010 (see Baird & Williamson 2010)

2. Guest workers/temporary migrants in Australia

(a) Definition/overview

                (b) Purpose

                (c) Types             

                (d) Rule-making process

                (e) Enforcement

Three Eras in Postwar Migration

•          1946-1972 Worker recruitment, demographic imperatives

•          1972-95 Planned program: Three elements – family, workers, refugees

•          Post 1995 Increased skill focus, mix of temporary and permanent strategies

4. Temporary Migrants in Australia
                (a) Definition/overview

Temporary migrants

•          “persons [who] enters the country on a temporary basis to work” [Hugo 2006, p.211]

•          Determined by worker intention, visa category, arrivals information

Guest work:

•          Guest work: “opportunities for citizens of poorer countries to migrate to wealthier countries on a temporary basis in order to fill labour shortages in various sectors” [Lenard and Straehle 2011, p. 1]

Temporary migration

“A new paradigm of international migration with the new large scale acceptance of temporary workers” (Hugo 2006)

•          highly selective of very skilled persons

–        Of 457 visa holders, 91% had university education

–        Of WHM, 55.7% had university education

–        Mostly professionals (50.5 %) and managers/administrators (21.4)

•          younger than Australian-born workforce

–        2005 survey – median age of 28.7 years vs. 38.6 for Australian born workforce, and 40.3 for permanent migrants

•          Temporary migrants make a significant economic contribution

•          A substantial proportion eventually settle in Australia

•          Concentrated in east coast cities (hence support for regional settlement)

4. Temporary Migrants in Australia
                (a) Definition/overview

•          Interesting domain because of cross-over between  employment relations (ER) and immigration and (increasingly) national security

•          We are interested in:

–        ER rules created specifically for temporary migrants

–        ER rules which disproportionately affect temporary migrants because of their characteristics

4. Temporary Migrants in Australia
                (b) Purpose

•          Migrants

–        Economic reasons [Lenard and Straehle 2011, p.2]

–        Other factors eg family, community, opportunity

•          Business

–        Addressing skills shortages

–        More flexible (amenable?) workers, lower wages [McGovern 2007: 223], esp. for women [p. 224]

•          Government

–        Skills and investment = > economic growth

–        ‘smooth out’ labour/skills supply and demand

–        ‘managing’ permanent migration

–        Humanitarian reasons

4. Temporary Migrants in Australia
                (c) Types

•          Employer Sponsored Workers: For people with recognised skills seeking to work in Australia after being sponsored by an Australian or overseas employer. Subclass 457 – business (long stay) visa, employer sponsored; also labour agreements for recruitment of a specified number over a number of years

•          Professionals and other Skilled Migrants: The General Skilled Migration, for people who are not sponsored by an employer but who have skills in particular occupations required in Australia. (Includes those sponsored by eligible relative). Includes provisions for independent or sponsored regional visas

–        Based on Skilled Occupation list:

•          Business People: For people to come to Australia for a business-related visit. Also for people to establish, manage or develop a new or existing business, or invest in Australia.

–        http://www.business.nsw.gov.au/live-and-work-in-nsw/visa-and-migration/business-migration/nsw-sponsored-visa-categories

–        Different visa categories based on how much is invested; how many years of experience; business ownership

•          Specialist Entry: For people to participate in specific professional, cultural, social or research activities.

•          Regional Employment: Information about options available to encourage skilled migrants to live and work in areas outside of Australia's major cities.

•          Pacific Seasonal Worker Scheme: Information for people from Kiribati, Papua New Guinea, Tonga and Vanuatu seeking to work in Australia under the Pacific Seasonal Worker Scheme.

•          Working holiday: For people aged between 18 and 30 from arrangement countries to have an extended holiday supplemented by short-term employment. Extensions available for those who work in particular industries for three months.

•          Students: With specifications about student work entitlements (40 hours/fortnight)

Find a visa at http://www.immi.gov.au/visawizard/

4. Temporary Migrants in Australia
                (d) Rule-making process

•          ER rules created specifically for temporary migrants

–        Recruitment and selection

•          determining SOL, 457 visas, labour agreements, regional employers

•          ER rules which disproportionately affect temporary migrants

–        Individual contracting for high skilled/paid end

–        Minimum/award wages for trades/low skilled (esp. Pacific workers, WHM, students)

4. Temporary Migrants in Australia
                (e) Enforcement

•          Employer can’t cancel visa but ….

•          Enforcement of minimum standards, esp. when potential consequences (relatively) more severe

•          Lack of knowledge about enforcement