Manajemen | Fakultas Ekonomi Universitas Maritim Raja Ali Haji 2003 1 (16)
EMPLOYER MATTERS IN 2002
PETER SHELDON* AND LOUISE THORNTHWAITE**
E
mployers and their associations found themselves in a more complex environment
largely of their own making. Desired change through the federal system appeared
too incremental yet repeated association calls for a hardening of the Workplace Relations
regime fell foul of the Senate. At state level, policy backlashes have all but removed
neo-liberal gains of the last decade. Developments in the building industry present an
anti-union federal government, associations and adversarial companies with their best
chance to extend the effects of the 1996 Act. In general, associations indulge in a
neo-liberal form of rentier policy pleading while unions continue to make gains in
unlikely circumstances.
INTRODUCTION
Commenting on employer matters in 1999, we pointed out that employers and
their associations, recently so triumphant in legislative and policy terms, faced
challenges from growing popular unease. This unease derived from perceived
rising employment insecurity and inequality, most obviously manifest in
extortionate executive remuneration and loss of entitlements suffered by
employees of failed companies. Since then, we have identified how this has
fed an electoral tide favouring policies that reverse neo-liberal (or ‘economic
rationalist’) policies in industrial relations.1 Prime Minister John Howard’s
exploitation of moral panic over asylum seekers allowed him to retain power in
November 2001 but, wherever his Liberal/National coalition could not so
mobilise public opinion, the trend has been irresistible. State Labor governments
have rolled back previous neo-liberal experiments, in some cases adding additional
spheres of employee protection and they have together backed the Australian
Council of Trade Unions (ACTU) claims within the Australian Industrial
Relations Commission (Commission). 2
Evidence of this shift is that former masters of the neo-liberal policy universe,
the ‘Workplace Relations Club’ (Club)3 appear to be shifting jobs faster and in
ever-tighter circles. Apart from federal Workplace Relations Minister Tony
Abbott’s office, the Australian Chamber of Commerce and Industry (ACCI) and
the National Farmers’ Federation, options are shrinking. State government
roosts are no longer available and large corporations seem less inclined to avail
themselves of the industrial relations depredations that seem to flow from hiring
Club members. Abbott’s generous patronage has allowed well-remunerated,
* Peter Sheldon, School of Industrial Relations and Organisational Behaviour, University of New
South Wales, Sydney, NSW 2052, Australia. Email: p.sheldon@unsw.edu.au ** Louise
Thornthwaite, Sydney Graduate School of Management, University of Western Sydney, PO Box
6145, Parramatta Delivery Centre, NSW 2150, Australia. Email: l.thornthwaite@uws.edu.au
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secure public sector employment—notably within the Commission—for some
of these free labour market partisans.
The opportunities that the Cole Royal Commission provided employer
associations during 2002 (see below) were a reminder of what Club influence
appeared to offer employer associations beguiled by its call. With this (important)
exception, association adhesion to the Club agenda proved counter-productive
as the counter-trends proved irresistible. Having pushed since 1999 for more
extreme amendments to a federal Workplace Relations Act 1996 (1996 Act) already
massively biased towards them, employer associations now find their policy credit
largely exhausted in a policy climate polarised on party lines and subject to
legislative backlash. In vain do they bemoan a loss of policy bipartisanship they
themselves greedily undermined and which, in cahoots with a vehemently antiemployee federal government, they continue to erode. As one leading association
official noted, the 1996 Act remains more politicised than its union-friendly New
South Wales contemporary, a pattern also largely true for Queensland.4 Arguably,
by trying to get legislative change on every issue that vexes them, employer associations have missed out on winning anything recently, including small employers’
‘holy grail’, exemption from unfair dismissal provisions. They have campaigned
loudly but poorly on this issue, inviting withering scrutiny from the media and
crucially important Australian Democrat Senator Andrew Murray.5
State level rollback of neo-liberal regulation has negated some of the Club’s
impact at the federal level. Further, many employers face increasing regulatory
and jurisdictional complexity through falling under discordant state and federal
systems. Federal Commission and judicial decisions have provided further
unexpected anxiety in employer associations’ battle for regulatory dominance.
Among such judicial interpretations, during 2002, the Federal Court in Emwest
seemingly gave the green light for unions to take protected industrial action
during the life of an enterprise agreement, provided that the action concerned
bargaining over issues not contained within the agreement.6 Employer associations have also been alarmed about decisions regarding union bargaining fees
(see below).
Employer representatives have adjusted to this political and judicial reality in
different ways. While some members would prefer otherwise, the (big) Business
Council of Australia (BCA), having achieved much of its ambitious agenda at
federal level, has removed industrial relations as a priority area. Given current
Labor state governments and Senate opposition, BCA activism on behalf of
its major remaining industrial relations policies (including a unitary legislative
framework) promises greatly diminishing returns. Instead, the BCA has enhanced
its focus on education and training (see below).7
Most major operational associations, with ACCI and Australian Industry Group
(AI Group) prominent, continue to urge federal legislative change—against
pattern bargaining, blocking union access to and use of strikes, weakening the
unfair dismissal regime and other matters—despite Senate resistance. During
2002, they were again almost completely unsuccessful. In response to these
reverses, ACCI sought policy redemption through its Blueprint (see below). Under
its new leadership, ACCI has reinforced its role as vociferous proponent of
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further criminalising union activity widely considered to be defining pillars of
democratic societies and legitimated under International Labour Organisation
core conventions.8 Moreover, major associations continue under the misapprehension that they are not intellectually and politically responsible for the increased
litigation and legal adversarialism that has unsurprisingly emerged since the 1996
Act shifted activity from a negotiation-oriented tribunal system to ‘real’ law in
the mainstream courts.9
Otherwise, the year appeared notable for fewer big clashes and a general
settling in crucial areas related to bargaining. Some association officials suggested
that this reflected a maturing of the system as many previously unclear matters
received clarification. There were also moments of (predictable) irony. One
involved the Australian Mines and Metals Association (AMMA), an association
with policies at the very extreme neo-liberal end of the Club. Long obsessed
with decentralised bargaining, it has now identified widespread ‘enterprise
bargaining fatigue’ among participants. It wants Abbott to amend the 1996 Act
to allow agreements to last up to five years rather than the current three. As was
always obvious, ‘enterprise’ bargaining is merely a bargaining level. It indicates
nothing about bargaining content or tone. Anti-union employers in a unionised
industry are always likely to meet ‘conflict based bargaining regimes’, the like
of which AMMA seeks to soften by lengthening agreement duration. It has
similar hopes for reducing enterprise bargaining’s (equally predictable) high
transaction costs for employers.10
The main changes in personnel within employer associations concerned
ACCI. At the start of the year, Peter Anderson, formerly of Ministers Reith and
Abbott’s office, replaced Brian Noakes as Director, Workplace Policy and Scott
Barklamb, previously with the defeated Court West Australian government, took
over as Manager, Labour Relations, filling the vacancy left when from Reg
Hamilton accepted an appointment as Deputy President of the Commission. In
mid year, Peter Hendy, a career public servant, filled the Chief Executive
position left vacant by Mark Paterson’s appointment to a senior public service
position.
We again largely concentrate on the activities of the major national associations—ACCI, AI Group and the BCA—and on the most important state-level
associations—the Victorian Employers’ Chamber of Commerce and Industry
(VECCI), Australian Business Limited (ABL) and Commerce Queensland.
Because of the prominence of building industry matters during 2002, we also
discussed issues with the Master Builders’ Association (MBA). Finally, for the
first time, we deal with vocational education and training in some detail. We would
like to express our gratitude to all the association officials who once again
generously gave of their time and patience.11
EMPLOYER
CHOICES OF INDUSTRIAL INSTRUMENT AND CONFLICT
Uncertainty still exists over the extent to which employers can and will use
the anti-union provisions of the 1996 Act. Minister Abbott publicly spurs such
initiatives, at employers’ risk, but with relatively little effect. One avenue is
non-union enterprise agreements, made under the purpose-drafted s. 170LK of
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the 1996 Act, and underpinned by the award system. A more contentious instrument is the (largely) individualised, award-free and secret Australian Workplace
Agreements (AWAs), which the government hotly favours, massively propagandises and subsidises (with PAYE employees’ taxes). Finally, there are the various
ways that employers can seek prosecution against or to litigate over union
activities. Employer anti-unionism, either through litigation or lockouts, can
produce conditions for s. 170LK agreements or AWAs. In previous years, we
commented on strategic employer anti-union adversarialism, particularly by
very large corporations.12 These generated some long and bitter disputes, which
unions often successfully met through improved organisational effectiveness and
creative legal approaches. In fact, frontal adversarialism appears to have done more
to overcome entrenched inter-union hostilities than decades of ACTU congresses.
During 2002, open employer adversarialism declined and some of its principal
earlier antagonists appear, for the moment at least, reconciled to negotiating with
unions. Moreover, in important sectors, pragmatic employers have remained deaf
to federal government entreaties to volunteer their firms for the front lines of
pitched class warfare against employees and their unions.13 As a result, employer
choices of instrument show incremental rather than dramatic change.
Small employer preferences appear to have generated strong growth in
(unregistered) common law contracts of employment rather than AWAs.14
Employers have signed up very few non-managerial employees on AWAs but
their use has important strategic implications. Employer association and
federal government rhetoric suggests that they are an instrument of choice
but employers can impose them on starting employees whose only redress is to
decline employment.15 Employer AWA initiatives regarding non-managerial
employees almost entirely focus upon actively unionised workforces. Why would
unionised employees be so much more likely to choose AWAs than the
non-unionised who ostensibly have a ‘better’ direct relationship with their
employers? As David Peetz makes clear, employers have used AWAs (or similar
state-level registered individual contracts) as a union-avoidance strategy, fulfilling
the obvious intent of the Act’s framers and their employer association cheerleaders.16 A typical employer strategy is to enter bargaining with little or no intention to really bargain. Unions receive a take-it-or-leave-it offer and, feigning
frustration with union intransigence, employers then offer their workforces more
generous pay as a reward for agreeing to registered individual contracts.
More consistent and impressive has been the growth in non-union s. 170LK
enterprise agreements certified. In the year ending 30 June 2002, the number
grew some 20 per cent over the previous year (1087 instead of 908) and
40 per cent over the previous two years.17 Certification only proceeds following
a majority vote of all employees concerned. Employer association feedback is that
growing use of these agreements is most obvious in previously non-unionised
environments where employers try to communicate better with employees and
employees genuinely choose the offer over remaining on the award or common
law contracts. Some of this also involves employers, on the advice of their associations, shifting from a state to the federal system because of its greater ease of
agreement making.18 In these ways, a diluted form of collective bargaining (albeit
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non-union) is spreading to firms with no history of it. Where, however, employers
have sought to use this instrument to stymie real bargaining with unions and
legitimate union representation, they often fail and exacerbate workplace
tensions. During 2002, there were a number of clamorous examples including,
once again, Minister Abbott’s own Federal Department of Employment and
Workplace Relations. Of the 65 per cent of the workforce who voted, 90 per
cent voted down management’s proposed s. 170 LK agreement.19 Towards year’s
end, a growing number of subcontractors in the commercial building sector gained
s. 170 LK agreements, apparently in the union-busting shadow of the Cole Royal
Commission and the Building Industry Taskforce (see below).20
Union-negotiated enterprise agreements still remain easily the most representative bargaining instrument. While their number declined (16 per cent) to 4321
during the year to 30 June 2002 compared to the previous 12 months (5147),
they were still well above the level certified during 1999/2000 (3536). As the
Commission pointed out, these fluctuations appear to have much to do with the
timing of agreement renewal in certain industries.21 Of particular interest was
that important employers, like Telstra and the Commonwealth Bank, who had
only recently embarked on bitter de-unionisation campaigns, reached enterprise
agreements with unions after relatively little aggravation. At smaller companies,
as in the paint industry, where the previous bargaining round had been bitterly
conflictual, the start of a new, union-initiated pattern bargaining round has also
been largely conflict free.22
Equally notable were events in the remote Pilbara mining region. During 2002,
BHP Iron Ore’s controversial November 1999 de-unionisation strategy finally
succumbed to local union activism, new state legislation and a decision of the
West Australian Industrial Relations Commission.23 Moreover, BHP’s close
competitor and anti-union pathbreaker, Rio Tinto, after a decade of non-union
individual contracts, suffered a humiliating setback in trying to shift from Western
Australia’s individual contracts to less controversial federal non-union enterprise
agreements. In voting, employees apparently vented their frustrations with how
arbitrary managerial prerogative had replaced a high trust approach.24 By year’s
end, both BHP and Rio shifted to offering AWAs but activist unionism had
strengthened at the first and had regained a symbolically important foothold in
the second.25
Employer associations continued to assert that, in principle, they favoured
maximum choice for employers and were agnostic about whatever choices
members made. However, this is not at all apparent from their evidence to the
Cole Royal Commission (below). Further, federal legislative constraints greatly
restrict any preferences that employers (and their associations) and employees
(and their unions) might express for multi-employer agreement making.26
EMPLOYER
ASSOCIATIONS AND STATE LEVEL INDUSTRIAL RELATIONS
Overwhelming Labor electoral victories in Tasmania and Victoria confirmed
how far the tide had turned against crude neoliberalism. In industrial relations,
further symptoms of profound philosophical and regulatory shift were the
August implementation of new Labor legislation in Western Australia and, in
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South Australia, the Stevens Report to the new Labor government in November.
Both caused consternation in employer association ranks. The first, redresses a
decade of blatant regulatory anti-unionism by, among other things, expanding
union operational rights and the role of the state commission and phasing out
registered state individual agreements. The second proposed many legislative
provisions that meet union demands.27
Elsewhere, state employer associations have largely learned to live pragmatically
with Labor governments that have, themselves, softened their pro-union
activism after short periods in power. Some associations, in fact, have decisively
warmed to Labor governments that share their policy directions in areas
outside (and perhaps more important than) industrial relations legislation.28 Areas
of disagreement naturally remain. During 2002, for example, Commerce
Queensland led opposition to a union application before the Queensland
Commission for a new Termination, Change and Redundancy ruling that would
anticipate matters federally (see below).29 While this is a major case, particularly
for small business, Victoria’s situation had more dramatic implications and
therefore merits separate treatment.
Victoria
During 2001 and 2002, Premier Steve Bracks’ minority Labor government
tried to meet union demands for the re-establishment of an extensive tribunal
system for Victoria (Fair Employment Bill) and for the criminalising of employer
culpability in workplace-related deaths and serious injuries (Industrial
Manslaughter Bill). Employer associations, particularly VECCI and AI
Group fought each bill tenaciously and, in each case, gained support from
the opposition-dominated upper house, which defeated the bills. Prior to the
election, the upper house also voted down the Federal Awards (Uniform Systems)
Bill, a much less ambitious replacement for the Fair Employment Bill.30 The
Uniform Systems Bill would simply have extended existing federal awards to the
approximately 50 per cent of Victorian employers previously exempt. While
VECCI criticised the cost implications for its many smaller members enjoying
cut-price workforces, many other VECCI members were paying higher labour
costs under the mainstream federal system. AI Group was sympathetic to an
initiative with little negative impact on its members but that met its preference
for developing a unitary national system.31
Labor’s resounding re-election on 30 November came despite its opponents’
(and federal minister Abbott’s) desperate attempts to make industrial relations
their central scare issue of the campaign.32 Despite involvement in recent policy
conflicts, VECCI took a neutral electoral position on industrial relations—‘open
to consider constructive suggestions about possible changes’33—including the
Uniform Systems Bill and prioritised education and training over industrial
relations. AI Group also remained non-partisan so that the leading associations
resisted the frustrated Liberals’ blandishments to align themselves (and industrial
relations policy debate) on party lines as ACCI had in recent federal elections.
AI Group favourably recognised Bracks’ government’s commitment to education
and training and, after the election, congratulated it warmly for supporting
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manufacturing. Noting that this government presented itself as otherwise
business-friendly, VECCI even conceded that some ‘legitimate concerns’ lay
behind the defeated bills.34
Employer associations are clearly relieved by the re-elected government’s much
softer industrial relations agenda. It has replaced the Industrial Manslaughter Bill
with milder improvements to workplace health and safety legislation and its plan
to re-introduce the Uniform System Bill meets most association objections.
Although Abbott previously refused to accept referral, employer associations
would prefer collaborative referral of state common rule powers to the federal
system to cover those Victorian employers presently outside it.35
CAMPAIGN 2003
Looming as a source of considerable trepidation for many employers was the
manufacturing unions’ Campaign 2003. With more than 1100 manufacturing
industry agreements due to expire in the first half of 2003 (including 500 in
Victoria), AI Group sank massive resources into encouraging members to resist
union pattern bargaining initiatives and into building a support base for the
coming struggle. In late 2002, AI Group held well-attended regional briefing
sessions with members, organised training programs, workshops and strategy
sessions. It has also developed information booklets and fact sheets, a dedicated
website and enterprise agreements database.36
Component manufacturers are a central and vulnerable union target given
their strategic position in carmakers’ just-in-time supply chain. Major disputes
at component-makers, such as Tristar and Walker Australia, in 2001 had dramatic
impacts on car making. The four local car manufacturers will not directly
face Campaign 2003 as their agreements expire later but, during 2002, they
were instrumental in the joint establishment—through the Federated
Chamber of Automotive Industries and the Federation of Automotive
Products Manufacturers—of a contingency fund to support components
manufacturers facing Campaign 2003 bargaining. The fund was a sop to federal
government insistence on employers fighting Campaign 2003 pattern bargaining
in return for a 4.2 billion dollar industry assistance package. It is unclear whether
automotive industry employers will risk a particularly adversarial strategy
against Campaign 2003. Car manufacturers have little interest in damaging their
own relationships with unions and have no wish to volunteer their components
suppliers for Abbott’s battle against pattern bargaining.37
Factional infighting that has riven the Victorian branch of the Australian
Manufacturing Workers’ Union caused particular concern to Victoria’s manufacturing employers. AI Group and VECCI both appreciated developments
during 2002 that weakened the Workers First faction’s influence within the
union. However, both anticipate that the factional sparring of 2002 will intensify the ferocity of Campaign 2003 in Victoria as non-Workers First officials
attempt to match their factional rivals’ militancy.38 Despite federal government
and association rhetoric against pattern bargaining and Campaign 2003, manufacturing union pattern bargaining has involved only a core framework, leaving
space for detailed negotiation at enterprise level.39 As manufacturing unions
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seem more flexible than those in building, this may explain why, towards the end
of 2002, some AI Group members from the engineering construction sector
formed a splinter group to discuss a pattern agreement with the former.40
COLE
ROYAL COMMISSION INTO BUILDING AND CONSTRUCTION
The establishment of this royal commission was a highly partisan act by Minister
Abbott seeking to damage the Labor Party and crush building and construction
unionism. The wording of its terms of reference thus directed the Royal
Commission to investigate ‘unlawful or otherwise inappropriate industrial or
workplace practice or conduct’. What ‘inappropriate’ meant was left unclear but
further wording indicated a range of issues that went to the heart of legitimate
and legal union behaviour. In this age of industrial relations political correctness,
it means behaviours Abbott dislikes and has been unable to ban because of
Senate obduracy. Much of Abbott’s rhetoric, Royal Commission endeavour
and employer association claims have focused on demonising union pattern
bargaining activity and on union job control over health and safety and other
issues. Most of the other terms of reference were clearly targeted at setting up
the building unions rather than tackling bigger but more complex problems
in the industry.41
The appointment of Terence Cole QC as Royal Commissioner was an
inspired choice and Abbott proved extravagantly generous, on taxpayers’ behalf,
in his funding of Cole and a make-work program for QCs and barristers. Cole
soon made it clear that he had no grasp of the history, political economy or
sociology of the industry and that he was uninterested in gaining one.
Further, his royal commission’s modus operandi was a legalistic form of tabloid
‘ambulance chasing’, of piling up particular cases, in an unreflective way, to infer
a picture rather than more properly using social science to paint one.
Commissioner and Counsel followed Abbott’s script in conflating illegality
and inappropriateness so that the process became a game of criminalising
(unionism) by numbers made worse by Cole’s determined insistence on greatly
limiting unions’ ability to cross-examine their accusers. Even some employers
and association officials (privately) acknowledged that, from conception, the
Royal Commission’s agenda was to traduce building unionism as a prelude to
its criminalisation.42
Clearly, illegality and even criminality exist within the industry, particularly in
some states. Yet this is not new and there is little evidence that it is currently
more pervasive. Nor does it emanate only from employees and their unions—
on the contrary. It is a rough industry with sometimes very tough industrial
relations. Much of this derives from the nature of the work and how developers
and the largest employers have chosen to structure the industry so as to reduce
their own risks. This has encouraged a number of employee and union behaviours
that greatly irritate industry employers just as it has encouraged parallel behaviours
from employers and between different layers within the employer contracting
chain. Uninterested in what generates this toughness, Cole preferred instead to
lump union (rather than employer) manifestations under ‘inappropriate’ and hunt
them down. Some officials within the industry’s unions have been trying to root
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out criminal elements within their ranks. Abbott, the Royal Commission (and
employer associations) chose to highlight headline incidents rather than
constructively work towards improving the industry for all parties.43
The starkest contrast possible was the work, during 2000–2001, of a
Queensland government (tripartite) Building and Construction Industry
(Workplace Health and Safety) Taskforce (Crittall Review). The chair, John
Crittall, although having had a strong employer association background, sought
and gained the cooperation of all parties in a concerted attempt to improve one
of the industry’s worst elements, where ‘people working in the industry are twice
as likely to be killed at work than the all industries Australian average’. Unlike
Cole, Crittall’s taskforce was deeply knowledgeable about the industry. At a tiny
fraction of the cost of Cole’s Royal Commission, it systematically investigated
relevant industry patterns as a basis for intervention strategies to ensure
minimisation of risk exposure and to ‘improve compliance levels of all
parties’.44 Employer representatives took a more enlightened approach to
Crittall’s taskforce than to Cole’s commission. This indicates their lack of
measure and self-reflection when anti-union ministers, like Abbott, give them
their head.
From the start of Cole’s substantive hearings in November 2001 until their
conclusion on 18 October 2002, employer associations got the uncontested space
that was denied to them in other forums. Single employers, particularly larger
ones, were unenthusiastic about formally participating and employer associations
acted in their stead. Again, this highlights how, in spite of all the ‘enterprise focus’
rhetoric, some associations are busier then ever as employers choose to use
them for controversial or broader representative issues. The MBA and AI Group,
competitors in this industry, were the main contributors, each making a number
of major submissions. Each also took full advantage of the opportunity to
disingenuously play to Cole’s instincts regarding ‘inappropriate’ behaviour. Both
also did much to actively inform their memberships on policy, submissions
and proceedings.45
The main associations clamoured for Cole (and Abbott) to clean up their
problems. A national MBA position emerged from discussion among state
MBAs although some of the latter also made submissions. The tenor of the
national position comes from its first Key Recommendation: ‘a reduction or
curtailment in the market power and dominance of unions, in particular the
CFMEU, and its exercise.’46 MBA reasoning draws from biology rather than
history, sociology or economics. On the one hand, the MBA noted that, ‘the
employer side of the industry has evolved in order to operate as efficiently as
possible, that the evolution process itself is neither right nor wrong and that it
simply constitutes the equilibrium position of the survival of the fittest. What
has evolved is what works best’. One wonders whether the MBA’s subcontractor
members anxiously awaiting long overdue payments for work done could not
imagine a better world and it would be interesting to imagine the response had
a similar initiative come from the union side. On the other hand we have parasitology as, ‘the CFMEU has militantly imported its ideology into a highly
pragmatic, free enterprise industry . . .’ and ‘union motivation is not altruistic
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but is aimed at buying the loyalty and obedience of rank and file union
members at the expense of the Australian community’. 47
Both the MBA and AI Group wanted a construction industry taskforce to
investigate and report breaches of various laws (and the MBA wanted it to have
enforcement powers). Both, and in particular AI Group, wanted to strengthen
the Commission’s role through a major projects tribunal or division within
the Commission to deal expeditiously with issues. Further claims included
amendments to the 1996 Act to outlaw protected action furthering pattern
bargaining, and stamp out coercive conduct and ‘inappropriate’ workplace
behaviour. Both called for much more rapid judicial responses to unprotected
union action with the MBA intent that these matters go directly to court and
that ‘penalties for unions and their officials [be] commensurate to the commercial
loss suffered by employers as a result of unlawful and inappropriate [our italics]
action’. Moreover, AI Group called for changes to the 1996 Act to allow project
agreements that would bind all subcontractors for the life of major projects. This
would answer the lack of fit, for employers (and unions), between enterprise
bargaining and the industry’s dominant subcontracting model. AI Group also
urged that protected action not be available during negotiation of project
agreements and that such agreements include an enforceable ‘no extra claims’
commitment.48
Given that letting of contracts to subcontractors would follow such project
agreements, the making of project agreements would precede the hiring of most
of any project’s workforce. This, together with restrictions extra claims and on
pattern bargaining, would effectively deprive all employees on major projects
(and by extension, in the wider industry) of the right to strike. It also would deprive
them of any say over project agreements they were to work under and of the
ability to set a reasonable industry-wide floor under those agreements. Given skills
shortages and in the absence of the right to strike, another outcome would be
greatly increased labour turnover and the (often ignored) employer costs involved.
AI Group argues that such an abrogation of fundamental democratic rights of
employees is in the public interest, which they clearly equate with the interests
of property developers and commercial builders. Fundamental to this is that they
are opposed to pattern bargaining because it allows employees to better their
wages and conditions.49 Unlike AI Group, the MBA rejected the necessity of
project agreements in favour of ‘choice’. This may reflect the MBA’s much
stronger membership base among smaller sub-contractors.50
As journalist Nicholas Way pointed out, all this runs against associations’ usual
agenda for lessening tribunal powers.51 It again suggests that association policy
makers wish to outlaw bargaining when it might be tough and want employee
dissent criminalised. Where unions are strong, there should be lots of law and
tribunal activism to curb or crush them. Where unions are weak or nonexistent, then laissez faire—to employers—should prevail. Cole and Abbott
have not disappointed employer associations. Cole’s interim report in August
recommended the industry taskforce and Abbott complied, staffing it with
people experienced in criminal investigation and prosecution. Its very generous
funding contrasts markedly with this government’s extreme tight-fistedness
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regarding occupational health and safety (OHS) research. Again criminal and
‘inappropriate’ activities are on the agenda and the taskforce seems particularly
intent on getting at unions through the industrial relations policy nexus between
head contractors and their subcontractors.52
Cole (partially) accepted union claims regarding OHS and there is a hope
that this may lead, eventually, to a national OHS regulatory framework. He also
entertained union complaints about security of payments to sub-contractors, sham
categorisation of employees as self-employed or subcontractors with consequent
tax evasions, non-payment of workers’ compensation premiums and nonpayment of employee entitlements. On these issues employer associations were
near to silent, jeopardising future opportunities to take the high moral ground
in arguing their legislative case before a skeptical Senate.53
Most hypocritical though was the insistence of associations that employers—
not employees and their unions—should control the selection of site safety
representatives. The pretext was disengaging workplace health and safety from
industrial relations (and union power) even though it is precisely this nexus that
has so greatly improved OHS in this and other industries. AI Group even argued
for managerial prerogative because ‘(E)mployers carry the risk for OHS on a
project’.54 Mortality and injury statistics would suggest the opposite as would
successful employer association pressure against industrial manslaughter bills.
One of the MBA and AI Group’s principal alternatives was for government
inspectors to get greater powers and to display greater activism. This is contrary
to evidence from the industry’s history and of contemporary developments in
other countries. What made it even more remarkable was that, in the Queensland
context, AI Group protested against a proposed legislative extension of government inspectors’ powers that flowed from the Crittall Review.55
Cole is to report in late February 2003. His royal commission operated in
the context of an almost unheard of boom in building and construction in most
capitals, record company profits and severe skilled labour shortages so that any
action is likely to bring union reaction.56 During 2002, building unions defiantly
launched their 36 hour week campaign. To the irritation of AI Group and the
New South Wales MBA, unions also won industry pattern bargains in Victoria
from the National Electrical Contractors’ Association and from the Victorian
MBA. In particular, that with the MBA means that Victorian industry expiry dates
mesh with those in the rest of the country.57
FIGHTING
MAJOR TEST CASES
Reasonable hours test case
Employer associations maintained their strident opposition to the ACTU’s
(un)reasonable hours test case before the Commission. They continued their
arguments from 2001, focusing on costs to employers, the claim’s allegedly rigid
‘one-size-fits-all’ approach, the potential for greater litigation and, increasingly,
lost overtime earnings for employees.58 ACCI and AI Group, which both invested
heavily in fighting the case, described it as a reversion to ‘days long gone’ of
centralised regulation, undoing more than a decade of greater enterprise focus
and flexibility.59 This was, of course, the ACTU’s objective given growing
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evidence that large numbers of employees are working longer hours, that these
hours are increasingly unpaid and that they are unhappy about it.60 Associations
were very pleased that the Commission rejected all the ACTU’s main claims and
merely clarified employee rights to refuse unreasonable overtime.61
Less reassuring were Commission findings about escalating hours of work and
their effects on employee health and lifestyle. Unions have clearly signalled
that work–life balance is a central claim both through enterprise bargaining and
campaigning for statutory paid maternity leave (see below). Strategically, this
may force employer associations to choose between championing ‘good
employers’, at the expense of more exploitative ones on issues such as unpaid
overtime, or face insurmountable community pressures for tighter legislation
affecting all employers.
Safety net
When the ACTU launched its 2002 ‘living wage claim’ for a $25 weekly wage
increase, the confident prediction from BRW to the business community was for
only a modest increase. Employer groups generally supported a $10 increase.62
Beyond that consensus, their positions diverged. AI Group joined the federal
government in arguing that, rather than increasing nominal wages, debate
should focus on delivering higher real incomes to wage earners through adjusting
taxes and welfare. AI Group effectively countered ACTU arguments that this
sounded like a wage freeze. It pointed out that tax payments and loss of welfare
benefits would erode any gains coming from a living wage increase and that the
ACTU should not delude its employees otherwise.63 This was the second
consecutive year that ACCI followed a more realistic course. In calling for
a ‘responsible, conservative approach’, it reiterated its mantra that any wage
increase should be linked to productivity growth. In this case, any increase
above $10, would fuel unemployment and inflation, and be a disincentive to
enterprise bargaining.64
Employer groups were unhappy with the Commission’s June decision to
award an $18 safety net increase but it was the Commission’s reasoning rather
than quantum of increase that most unsettled them. The Commission had largely
rejected their pessimism concerning the macro-economic effects of wage
increases and their proposed wage fixing criteria. Attacking the decision as ‘out
of step with the IRC’s role in wages policy’, ACCI warned of dire consequences
for the economy and the low paid.65 Divergences in employer stances have continued in early responses to the ACTU’s recent safety net claim for 2003. ACCI
has stridently opposed the wage claims for low paid workers, as ‘excessive and
ambitious’, and displaying a ‘certain element of opportunism’ by the ACTU. Once
again, AI Group has raised the poverty trap argument as well as arguing that
the ACTU has understated the impact of flow-on costs of wage increases for
employers. 66
Non-union bargaining fees
Employer groups’ delight in late 200167 with Justice Merkel’s Federal Court
Electrolux decision excluding non-union bargaining fees from certified agreements
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was short-lived. In June 2002, a Federal Court full bench found that unions could
take protected industrial action in support of genuinely made claims, including
bargaining agents’ fees. Describing the decision as ‘an example of judicial activism’
that provided a back door for compulsory unionism, ACCI called on the government to reassert ‘control’ over the 1996 Act through immediate legislative
reversal of the Court’s decision.68 On behalf of Electrolux, AI Group appealed
to the High Court principally on the ground that paying bargaining fees to a
third party was not part of an employment relationship and this matter will unfold
during 2003. Calming employers’ fears over the Federal Court decision, the
Commission subsequently refused to certify numerous agreements that contained
bargaining fee clauses. In this, Deputy President Hamilton was prominent,
winning hearty applause from employer bodies and provoking an appeal from
unions. AI Group and the federal government defended the unsuccessful appeal
as a full bench confirmed Hamilton’s position.69
Seeking to forestall union claims for such fees in the New South Wales
jurisdiction, following failed union attempts before the South Australian and
Queensland tribunals, ABL joined with the National Electrical Contractors
Association to lobby for inclusion of an anti-bargaining fee principle in the
enterprise agreement approval process in New South Wales. While unsuccessful,
the resultant principles provide an opening for employers to argue against the
inclusion of bargaining fees on a case-by-case basis.70
Termination, change and redundancy
Employers’ interest in the issue of employee entitlements shifted in 2002, from
how best to protect entitlements in cases of corporate insolvency to the question
of employees’ entitlements in situations of termination, change and redundancy
(TCR). This shift followed the ACTU’s claim before the Commission for
improvements to minimum award entitlements established in the 1984
Termination, Change and Redundancy Decision. The ACTU’s re-embracing of TCR
issues was strategically timely given the number and seriousness of high profile
staffing contractions in 2001, the string of sensational corporate failures and the
tentative resolution of the employee entitlement issue through a scheme the
federal government introduced in late 2001. Echoing the current situation in
New South Wales, the ACTU’s claim included demands to double the minimum
severance pay entitlement from 4 to 8 weeks, compensate employees aged over
45 years for their reduced employment opportunities, extend the entitlements
to casual employees, and include small businesses. Although Commission hearings
were not to begin until 2003, the ACTU’s claim sparked a flurry of employer
activity, which intensified when the matter reached test case status in Queensland.
Employers displayed remarkable unity in their responses to the TCR claim.
Almost with one voice, employer groups rejected extending TCR entitlements
to casual employees, improving entitlements for those over 45, and roping in
small businesses—apparently the issue causing greatest disquiet. Their counter
claims differed in nature, although not in sentiment. In response to a request
from the Queensland Commission, Commerce Queensland proposed a considerable increase in minimum severance pay entitlement, to up to 10 weeks pay
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but continued to fully oppose all other union claims.71 AI Group proposed that
awards be amended to include separate provisions for insolvency-based redundancies and those for other reasons. AI Group also suggested greater protections
for employers, including explicit exclusion of redundancy entitlements for
employees in cases of transmission of business—an issue at the heart of a
continuing dispute that began when the Commonwealth Bank outsourced
information services functions to EDS in 1997.72 Given that the ACCI blueprint
talks of employers having a fundamental right to restructure business without
third party interference, it is not surprising that ACCI’s counter claim went
further than other employer groups’ in claiming unfettered management rights
to cut labour. However, since then, ACCI also proposed that longer service
periods be required for eligibility to TCR entitlements and employers in
depressed or failing industries be allowed to seek exemption or reduction from
redundancy payments when unable to pay. At the very end of 2002, conciliation
before the Commission brought agreement on some issues between AI Group
and ACCI (representing employers) and the ACTU but important differences
remain for resolution during 2003.73
Association determination in pushing for enhanced employers’ TCR prerogatives seems rather disingenuous when placed alongside other events and
developments in 2002. While there were fewer high profile staffing contractions
and scandals over executive salary levels in 2002 than in 2001 (and even signs of
some moderating in executive pay rises) there were enough to keep fuelling
public disquiet. One of the most publicised cases was that of AMP which
announced several rounds of large-scale retrenchments in 2002 but suffered
embarrassing speculation concerning a rumoured 20 million dollar termination
payment to its (sacked) chief executive.74 Perhaps the most sensational case
demonstrated the lengths to which some employers will go to avoid paying
employees’ entitlements. In March, Coogi Nominees transferred 240 employees
to shelf companies with no assets, effectively denying them their accrued entitlements when it went into liquidation. In the Federal Court, Justice Merkel
scathingly charged the company with treating its employees like ‘serfs rather than
free citizens’, and, ruled that it could not arbitrarily transfer employees to another
company without their assent.75
PAID
MATERNITY LEAVE
During 2002, employer groups intervened strongly in the debate on paid
maternity leave. Most major employer associations submitted lengthy responses
to the Sex Discrimination Commissioner’s interim report, Valuing Parenting,
published in April. They also contributed vigorously to subsequent intense
media debate until the final report, Paid Maternity Leave: A Time to Value, in
December. Of greatest concern to employers was the question of who would
fund paid maternity leave. Not surprisingly, they were united in opposition to
any compulsory employer-funded scheme. If paid maternity leave was to become
an employment benefit, employer associations argued, it should be funded as an
additional payment through the social welfare system. The National Farmers’
Federation even opposed that, calling instead for a redistribution within the
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existing family welfare budget.76 For its part, ACCI remained unconvinced that
paid parental leave was the most equitable and efficient means of delivering social
support for parenting, and it criticised government-funded schemes overseas,
claiming that they provided a disincentive to employment. Throughout the year,
some employer associations, essentially (but unfashionably) opposed to paid
maternity leave, fanned the flames of fear, particularly among small and medium
employers, by suggesting that the review would recommend that employers carry
this financial burden.77
ACCI, AI Group and ABL were particularly anxious that any new maternity
leave scheme should include protection for employers against industry-wide union
campaigns and Commission test cases to extend maternity benefits. Again
arguing against ‘one size fits all’ policies, they insisted that additional benefits
should derive only from enterprise bargaining: any compulsory topping-up
through the industrial relations system should be prohibited. ABL proposed
that the federal government exclude paid maternity leave as an allowable award
matter, to preclude unions winning above test-case standards in awards.78
Mysteriously, given the facts, ACCI also viewed the current universal unpaid
leave entitlement of 12 months as extremely generous by international standards.
Accordingly, it also criticised, as ‘utterly impractical’, a foreshadowed ACTU test
case to extend unpaid maternity leave entitlements to three years (or five years
through negotiation) and provide other benefits in terms of access to part-time
work, family-friendly rosters and flexible annual leave options. When the ACTU
refined its claim, for example reducing the leave entitlement sought from three
to two years, ACCI Chief Executive, Peter Hendy countered by asserting
that Australia ‘does not have the luxury to fiddle around with this narrow
agenda’.79
By recommending that the government fund a 14-week paid maternity leave
scheme, the Sex Discrimination Commissioner’s final report allayed employers’
greatest fears. Once again, there were also differences among associations.
While AI Group’s Chief Executive Bob Herbert applauded the report, ACCI’s
Hendy damned it with faint praise and criticised it for failing to close the
door on emplo
PETER SHELDON* AND LOUISE THORNTHWAITE**
E
mployers and their associations found themselves in a more complex environment
largely of their own making. Desired change through the federal system appeared
too incremental yet repeated association calls for a hardening of the Workplace Relations
regime fell foul of the Senate. At state level, policy backlashes have all but removed
neo-liberal gains of the last decade. Developments in the building industry present an
anti-union federal government, associations and adversarial companies with their best
chance to extend the effects of the 1996 Act. In general, associations indulge in a
neo-liberal form of rentier policy pleading while unions continue to make gains in
unlikely circumstances.
INTRODUCTION
Commenting on employer matters in 1999, we pointed out that employers and
their associations, recently so triumphant in legislative and policy terms, faced
challenges from growing popular unease. This unease derived from perceived
rising employment insecurity and inequality, most obviously manifest in
extortionate executive remuneration and loss of entitlements suffered by
employees of failed companies. Since then, we have identified how this has
fed an electoral tide favouring policies that reverse neo-liberal (or ‘economic
rationalist’) policies in industrial relations.1 Prime Minister John Howard’s
exploitation of moral panic over asylum seekers allowed him to retain power in
November 2001 but, wherever his Liberal/National coalition could not so
mobilise public opinion, the trend has been irresistible. State Labor governments
have rolled back previous neo-liberal experiments, in some cases adding additional
spheres of employee protection and they have together backed the Australian
Council of Trade Unions (ACTU) claims within the Australian Industrial
Relations Commission (Commission). 2
Evidence of this shift is that former masters of the neo-liberal policy universe,
the ‘Workplace Relations Club’ (Club)3 appear to be shifting jobs faster and in
ever-tighter circles. Apart from federal Workplace Relations Minister Tony
Abbott’s office, the Australian Chamber of Commerce and Industry (ACCI) and
the National Farmers’ Federation, options are shrinking. State government
roosts are no longer available and large corporations seem less inclined to avail
themselves of the industrial relations depredations that seem to flow from hiring
Club members. Abbott’s generous patronage has allowed well-remunerated,
* Peter Sheldon, School of Industrial Relations and Organisational Behaviour, University of New
South Wales, Sydney, NSW 2052, Australia. Email: p.sheldon@unsw.edu.au ** Louise
Thornthwaite, Sydney Graduate School of Management, University of Western Sydney, PO Box
6145, Parramatta Delivery Centre, NSW 2150, Australia. Email: l.thornthwaite@uws.edu.au
THE JOURNAL OF INDUSTRIAL RELATIONS, VOL. 45, NO. 2, JUNE 2003, 224–253
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secure public sector employment—notably within the Commission—for some
of these free labour market partisans.
The opportunities that the Cole Royal Commission provided employer
associations during 2002 (see below) were a reminder of what Club influence
appeared to offer employer associations beguiled by its call. With this (important)
exception, association adhesion to the Club agenda proved counter-productive
as the counter-trends proved irresistible. Having pushed since 1999 for more
extreme amendments to a federal Workplace Relations Act 1996 (1996 Act) already
massively biased towards them, employer associations now find their policy credit
largely exhausted in a policy climate polarised on party lines and subject to
legislative backlash. In vain do they bemoan a loss of policy bipartisanship they
themselves greedily undermined and which, in cahoots with a vehemently antiemployee federal government, they continue to erode. As one leading association
official noted, the 1996 Act remains more politicised than its union-friendly New
South Wales contemporary, a pattern also largely true for Queensland.4 Arguably,
by trying to get legislative change on every issue that vexes them, employer associations have missed out on winning anything recently, including small employers’
‘holy grail’, exemption from unfair dismissal provisions. They have campaigned
loudly but poorly on this issue, inviting withering scrutiny from the media and
crucially important Australian Democrat Senator Andrew Murray.5
State level rollback of neo-liberal regulation has negated some of the Club’s
impact at the federal level. Further, many employers face increasing regulatory
and jurisdictional complexity through falling under discordant state and federal
systems. Federal Commission and judicial decisions have provided further
unexpected anxiety in employer associations’ battle for regulatory dominance.
Among such judicial interpretations, during 2002, the Federal Court in Emwest
seemingly gave the green light for unions to take protected industrial action
during the life of an enterprise agreement, provided that the action concerned
bargaining over issues not contained within the agreement.6 Employer associations have also been alarmed about decisions regarding union bargaining fees
(see below).
Employer representatives have adjusted to this political and judicial reality in
different ways. While some members would prefer otherwise, the (big) Business
Council of Australia (BCA), having achieved much of its ambitious agenda at
federal level, has removed industrial relations as a priority area. Given current
Labor state governments and Senate opposition, BCA activism on behalf of
its major remaining industrial relations policies (including a unitary legislative
framework) promises greatly diminishing returns. Instead, the BCA has enhanced
its focus on education and training (see below).7
Most major operational associations, with ACCI and Australian Industry Group
(AI Group) prominent, continue to urge federal legislative change—against
pattern bargaining, blocking union access to and use of strikes, weakening the
unfair dismissal regime and other matters—despite Senate resistance. During
2002, they were again almost completely unsuccessful. In response to these
reverses, ACCI sought policy redemption through its Blueprint (see below). Under
its new leadership, ACCI has reinforced its role as vociferous proponent of
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further criminalising union activity widely considered to be defining pillars of
democratic societies and legitimated under International Labour Organisation
core conventions.8 Moreover, major associations continue under the misapprehension that they are not intellectually and politically responsible for the increased
litigation and legal adversarialism that has unsurprisingly emerged since the 1996
Act shifted activity from a negotiation-oriented tribunal system to ‘real’ law in
the mainstream courts.9
Otherwise, the year appeared notable for fewer big clashes and a general
settling in crucial areas related to bargaining. Some association officials suggested
that this reflected a maturing of the system as many previously unclear matters
received clarification. There were also moments of (predictable) irony. One
involved the Australian Mines and Metals Association (AMMA), an association
with policies at the very extreme neo-liberal end of the Club. Long obsessed
with decentralised bargaining, it has now identified widespread ‘enterprise
bargaining fatigue’ among participants. It wants Abbott to amend the 1996 Act
to allow agreements to last up to five years rather than the current three. As was
always obvious, ‘enterprise’ bargaining is merely a bargaining level. It indicates
nothing about bargaining content or tone. Anti-union employers in a unionised
industry are always likely to meet ‘conflict based bargaining regimes’, the like
of which AMMA seeks to soften by lengthening agreement duration. It has
similar hopes for reducing enterprise bargaining’s (equally predictable) high
transaction costs for employers.10
The main changes in personnel within employer associations concerned
ACCI. At the start of the year, Peter Anderson, formerly of Ministers Reith and
Abbott’s office, replaced Brian Noakes as Director, Workplace Policy and Scott
Barklamb, previously with the defeated Court West Australian government, took
over as Manager, Labour Relations, filling the vacancy left when from Reg
Hamilton accepted an appointment as Deputy President of the Commission. In
mid year, Peter Hendy, a career public servant, filled the Chief Executive
position left vacant by Mark Paterson’s appointment to a senior public service
position.
We again largely concentrate on the activities of the major national associations—ACCI, AI Group and the BCA—and on the most important state-level
associations—the Victorian Employers’ Chamber of Commerce and Industry
(VECCI), Australian Business Limited (ABL) and Commerce Queensland.
Because of the prominence of building industry matters during 2002, we also
discussed issues with the Master Builders’ Association (MBA). Finally, for the
first time, we deal with vocational education and training in some detail. We would
like to express our gratitude to all the association officials who once again
generously gave of their time and patience.11
EMPLOYER
CHOICES OF INDUSTRIAL INSTRUMENT AND CONFLICT
Uncertainty still exists over the extent to which employers can and will use
the anti-union provisions of the 1996 Act. Minister Abbott publicly spurs such
initiatives, at employers’ risk, but with relatively little effect. One avenue is
non-union enterprise agreements, made under the purpose-drafted s. 170LK of
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the 1996 Act, and underpinned by the award system. A more contentious instrument is the (largely) individualised, award-free and secret Australian Workplace
Agreements (AWAs), which the government hotly favours, massively propagandises and subsidises (with PAYE employees’ taxes). Finally, there are the various
ways that employers can seek prosecution against or to litigate over union
activities. Employer anti-unionism, either through litigation or lockouts, can
produce conditions for s. 170LK agreements or AWAs. In previous years, we
commented on strategic employer anti-union adversarialism, particularly by
very large corporations.12 These generated some long and bitter disputes, which
unions often successfully met through improved organisational effectiveness and
creative legal approaches. In fact, frontal adversarialism appears to have done more
to overcome entrenched inter-union hostilities than decades of ACTU congresses.
During 2002, open employer adversarialism declined and some of its principal
earlier antagonists appear, for the moment at least, reconciled to negotiating with
unions. Moreover, in important sectors, pragmatic employers have remained deaf
to federal government entreaties to volunteer their firms for the front lines of
pitched class warfare against employees and their unions.13 As a result, employer
choices of instrument show incremental rather than dramatic change.
Small employer preferences appear to have generated strong growth in
(unregistered) common law contracts of employment rather than AWAs.14
Employers have signed up very few non-managerial employees on AWAs but
their use has important strategic implications. Employer association and
federal government rhetoric suggests that they are an instrument of choice
but employers can impose them on starting employees whose only redress is to
decline employment.15 Employer AWA initiatives regarding non-managerial
employees almost entirely focus upon actively unionised workforces. Why would
unionised employees be so much more likely to choose AWAs than the
non-unionised who ostensibly have a ‘better’ direct relationship with their
employers? As David Peetz makes clear, employers have used AWAs (or similar
state-level registered individual contracts) as a union-avoidance strategy, fulfilling
the obvious intent of the Act’s framers and their employer association cheerleaders.16 A typical employer strategy is to enter bargaining with little or no intention to really bargain. Unions receive a take-it-or-leave-it offer and, feigning
frustration with union intransigence, employers then offer their workforces more
generous pay as a reward for agreeing to registered individual contracts.
More consistent and impressive has been the growth in non-union s. 170LK
enterprise agreements certified. In the year ending 30 June 2002, the number
grew some 20 per cent over the previous year (1087 instead of 908) and
40 per cent over the previous two years.17 Certification only proceeds following
a majority vote of all employees concerned. Employer association feedback is that
growing use of these agreements is most obvious in previously non-unionised
environments where employers try to communicate better with employees and
employees genuinely choose the offer over remaining on the award or common
law contracts. Some of this also involves employers, on the advice of their associations, shifting from a state to the federal system because of its greater ease of
agreement making.18 In these ways, a diluted form of collective bargaining (albeit
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non-union) is spreading to firms with no history of it. Where, however, employers
have sought to use this instrument to stymie real bargaining with unions and
legitimate union representation, they often fail and exacerbate workplace
tensions. During 2002, there were a number of clamorous examples including,
once again, Minister Abbott’s own Federal Department of Employment and
Workplace Relations. Of the 65 per cent of the workforce who voted, 90 per
cent voted down management’s proposed s. 170 LK agreement.19 Towards year’s
end, a growing number of subcontractors in the commercial building sector gained
s. 170 LK agreements, apparently in the union-busting shadow of the Cole Royal
Commission and the Building Industry Taskforce (see below).20
Union-negotiated enterprise agreements still remain easily the most representative bargaining instrument. While their number declined (16 per cent) to 4321
during the year to 30 June 2002 compared to the previous 12 months (5147),
they were still well above the level certified during 1999/2000 (3536). As the
Commission pointed out, these fluctuations appear to have much to do with the
timing of agreement renewal in certain industries.21 Of particular interest was
that important employers, like Telstra and the Commonwealth Bank, who had
only recently embarked on bitter de-unionisation campaigns, reached enterprise
agreements with unions after relatively little aggravation. At smaller companies,
as in the paint industry, where the previous bargaining round had been bitterly
conflictual, the start of a new, union-initiated pattern bargaining round has also
been largely conflict free.22
Equally notable were events in the remote Pilbara mining region. During 2002,
BHP Iron Ore’s controversial November 1999 de-unionisation strategy finally
succumbed to local union activism, new state legislation and a decision of the
West Australian Industrial Relations Commission.23 Moreover, BHP’s close
competitor and anti-union pathbreaker, Rio Tinto, after a decade of non-union
individual contracts, suffered a humiliating setback in trying to shift from Western
Australia’s individual contracts to less controversial federal non-union enterprise
agreements. In voting, employees apparently vented their frustrations with how
arbitrary managerial prerogative had replaced a high trust approach.24 By year’s
end, both BHP and Rio shifted to offering AWAs but activist unionism had
strengthened at the first and had regained a symbolically important foothold in
the second.25
Employer associations continued to assert that, in principle, they favoured
maximum choice for employers and were agnostic about whatever choices
members made. However, this is not at all apparent from their evidence to the
Cole Royal Commission (below). Further, federal legislative constraints greatly
restrict any preferences that employers (and their associations) and employees
(and their unions) might express for multi-employer agreement making.26
EMPLOYER
ASSOCIATIONS AND STATE LEVEL INDUSTRIAL RELATIONS
Overwhelming Labor electoral victories in Tasmania and Victoria confirmed
how far the tide had turned against crude neoliberalism. In industrial relations,
further symptoms of profound philosophical and regulatory shift were the
August implementation of new Labor legislation in Western Australia and, in
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South Australia, the Stevens Report to the new Labor government in November.
Both caused consternation in employer association ranks. The first, redresses a
decade of blatant regulatory anti-unionism by, among other things, expanding
union operational rights and the role of the state commission and phasing out
registered state individual agreements. The second proposed many legislative
provisions that meet union demands.27
Elsewhere, state employer associations have largely learned to live pragmatically
with Labor governments that have, themselves, softened their pro-union
activism after short periods in power. Some associations, in fact, have decisively
warmed to Labor governments that share their policy directions in areas
outside (and perhaps more important than) industrial relations legislation.28 Areas
of disagreement naturally remain. During 2002, for example, Commerce
Queensland led opposition to a union application before the Queensland
Commission for a new Termination, Change and Redundancy ruling that would
anticipate matters federally (see below).29 While this is a major case, particularly
for small business, Victoria’s situation had more dramatic implications and
therefore merits separate treatment.
Victoria
During 2001 and 2002, Premier Steve Bracks’ minority Labor government
tried to meet union demands for the re-establishment of an extensive tribunal
system for Victoria (Fair Employment Bill) and for the criminalising of employer
culpability in workplace-related deaths and serious injuries (Industrial
Manslaughter Bill). Employer associations, particularly VECCI and AI
Group fought each bill tenaciously and, in each case, gained support from
the opposition-dominated upper house, which defeated the bills. Prior to the
election, the upper house also voted down the Federal Awards (Uniform Systems)
Bill, a much less ambitious replacement for the Fair Employment Bill.30 The
Uniform Systems Bill would simply have extended existing federal awards to the
approximately 50 per cent of Victorian employers previously exempt. While
VECCI criticised the cost implications for its many smaller members enjoying
cut-price workforces, many other VECCI members were paying higher labour
costs under the mainstream federal system. AI Group was sympathetic to an
initiative with little negative impact on its members but that met its preference
for developing a unitary national system.31
Labor’s resounding re-election on 30 November came despite its opponents’
(and federal minister Abbott’s) desperate attempts to make industrial relations
their central scare issue of the campaign.32 Despite involvement in recent policy
conflicts, VECCI took a neutral electoral position on industrial relations—‘open
to consider constructive suggestions about possible changes’33—including the
Uniform Systems Bill and prioritised education and training over industrial
relations. AI Group also remained non-partisan so that the leading associations
resisted the frustrated Liberals’ blandishments to align themselves (and industrial
relations policy debate) on party lines as ACCI had in recent federal elections.
AI Group favourably recognised Bracks’ government’s commitment to education
and training and, after the election, congratulated it warmly for supporting
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manufacturing. Noting that this government presented itself as otherwise
business-friendly, VECCI even conceded that some ‘legitimate concerns’ lay
behind the defeated bills.34
Employer associations are clearly relieved by the re-elected government’s much
softer industrial relations agenda. It has replaced the Industrial Manslaughter Bill
with milder improvements to workplace health and safety legislation and its plan
to re-introduce the Uniform System Bill meets most association objections.
Although Abbott previously refused to accept referral, employer associations
would prefer collaborative referral of state common rule powers to the federal
system to cover those Victorian employers presently outside it.35
CAMPAIGN 2003
Looming as a source of considerable trepidation for many employers was the
manufacturing unions’ Campaign 2003. With more than 1100 manufacturing
industry agreements due to expire in the first half of 2003 (including 500 in
Victoria), AI Group sank massive resources into encouraging members to resist
union pattern bargaining initiatives and into building a support base for the
coming struggle. In late 2002, AI Group held well-attended regional briefing
sessions with members, organised training programs, workshops and strategy
sessions. It has also developed information booklets and fact sheets, a dedicated
website and enterprise agreements database.36
Component manufacturers are a central and vulnerable union target given
their strategic position in carmakers’ just-in-time supply chain. Major disputes
at component-makers, such as Tristar and Walker Australia, in 2001 had dramatic
impacts on car making. The four local car manufacturers will not directly
face Campaign 2003 as their agreements expire later but, during 2002, they
were instrumental in the joint establishment—through the Federated
Chamber of Automotive Industries and the Federation of Automotive
Products Manufacturers—of a contingency fund to support components
manufacturers facing Campaign 2003 bargaining. The fund was a sop to federal
government insistence on employers fighting Campaign 2003 pattern bargaining
in return for a 4.2 billion dollar industry assistance package. It is unclear whether
automotive industry employers will risk a particularly adversarial strategy
against Campaign 2003. Car manufacturers have little interest in damaging their
own relationships with unions and have no wish to volunteer their components
suppliers for Abbott’s battle against pattern bargaining.37
Factional infighting that has riven the Victorian branch of the Australian
Manufacturing Workers’ Union caused particular concern to Victoria’s manufacturing employers. AI Group and VECCI both appreciated developments
during 2002 that weakened the Workers First faction’s influence within the
union. However, both anticipate that the factional sparring of 2002 will intensify the ferocity of Campaign 2003 in Victoria as non-Workers First officials
attempt to match their factional rivals’ militancy.38 Despite federal government
and association rhetoric against pattern bargaining and Campaign 2003, manufacturing union pattern bargaining has involved only a core framework, leaving
space for detailed negotiation at enterprise level.39 As manufacturing unions
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seem more flexible than those in building, this may explain why, towards the end
of 2002, some AI Group members from the engineering construction sector
formed a splinter group to discuss a pattern agreement with the former.40
COLE
ROYAL COMMISSION INTO BUILDING AND CONSTRUCTION
The establishment of this royal commission was a highly partisan act by Minister
Abbott seeking to damage the Labor Party and crush building and construction
unionism. The wording of its terms of reference thus directed the Royal
Commission to investigate ‘unlawful or otherwise inappropriate industrial or
workplace practice or conduct’. What ‘inappropriate’ meant was left unclear but
further wording indicated a range of issues that went to the heart of legitimate
and legal union behaviour. In this age of industrial relations political correctness,
it means behaviours Abbott dislikes and has been unable to ban because of
Senate obduracy. Much of Abbott’s rhetoric, Royal Commission endeavour
and employer association claims have focused on demonising union pattern
bargaining activity and on union job control over health and safety and other
issues. Most of the other terms of reference were clearly targeted at setting up
the building unions rather than tackling bigger but more complex problems
in the industry.41
The appointment of Terence Cole QC as Royal Commissioner was an
inspired choice and Abbott proved extravagantly generous, on taxpayers’ behalf,
in his funding of Cole and a make-work program for QCs and barristers. Cole
soon made it clear that he had no grasp of the history, political economy or
sociology of the industry and that he was uninterested in gaining one.
Further, his royal commission’s modus operandi was a legalistic form of tabloid
‘ambulance chasing’, of piling up particular cases, in an unreflective way, to infer
a picture rather than more properly using social science to paint one.
Commissioner and Counsel followed Abbott’s script in conflating illegality
and inappropriateness so that the process became a game of criminalising
(unionism) by numbers made worse by Cole’s determined insistence on greatly
limiting unions’ ability to cross-examine their accusers. Even some employers
and association officials (privately) acknowledged that, from conception, the
Royal Commission’s agenda was to traduce building unionism as a prelude to
its criminalisation.42
Clearly, illegality and even criminality exist within the industry, particularly in
some states. Yet this is not new and there is little evidence that it is currently
more pervasive. Nor does it emanate only from employees and their unions—
on the contrary. It is a rough industry with sometimes very tough industrial
relations. Much of this derives from the nature of the work and how developers
and the largest employers have chosen to structure the industry so as to reduce
their own risks. This has encouraged a number of employee and union behaviours
that greatly irritate industry employers just as it has encouraged parallel behaviours
from employers and between different layers within the employer contracting
chain. Uninterested in what generates this toughness, Cole preferred instead to
lump union (rather than employer) manifestations under ‘inappropriate’ and hunt
them down. Some officials within the industry’s unions have been trying to root
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out criminal elements within their ranks. Abbott, the Royal Commission (and
employer associations) chose to highlight headline incidents rather than
constructively work towards improving the industry for all parties.43
The starkest contrast possible was the work, during 2000–2001, of a
Queensland government (tripartite) Building and Construction Industry
(Workplace Health and Safety) Taskforce (Crittall Review). The chair, John
Crittall, although having had a strong employer association background, sought
and gained the cooperation of all parties in a concerted attempt to improve one
of the industry’s worst elements, where ‘people working in the industry are twice
as likely to be killed at work than the all industries Australian average’. Unlike
Cole, Crittall’s taskforce was deeply knowledgeable about the industry. At a tiny
fraction of the cost of Cole’s Royal Commission, it systematically investigated
relevant industry patterns as a basis for intervention strategies to ensure
minimisation of risk exposure and to ‘improve compliance levels of all
parties’.44 Employer representatives took a more enlightened approach to
Crittall’s taskforce than to Cole’s commission. This indicates their lack of
measure and self-reflection when anti-union ministers, like Abbott, give them
their head.
From the start of Cole’s substantive hearings in November 2001 until their
conclusion on 18 October 2002, employer associations got the uncontested space
that was denied to them in other forums. Single employers, particularly larger
ones, were unenthusiastic about formally participating and employer associations
acted in their stead. Again, this highlights how, in spite of all the ‘enterprise focus’
rhetoric, some associations are busier then ever as employers choose to use
them for controversial or broader representative issues. The MBA and AI Group,
competitors in this industry, were the main contributors, each making a number
of major submissions. Each also took full advantage of the opportunity to
disingenuously play to Cole’s instincts regarding ‘inappropriate’ behaviour. Both
also did much to actively inform their memberships on policy, submissions
and proceedings.45
The main associations clamoured for Cole (and Abbott) to clean up their
problems. A national MBA position emerged from discussion among state
MBAs although some of the latter also made submissions. The tenor of the
national position comes from its first Key Recommendation: ‘a reduction or
curtailment in the market power and dominance of unions, in particular the
CFMEU, and its exercise.’46 MBA reasoning draws from biology rather than
history, sociology or economics. On the one hand, the MBA noted that, ‘the
employer side of the industry has evolved in order to operate as efficiently as
possible, that the evolution process itself is neither right nor wrong and that it
simply constitutes the equilibrium position of the survival of the fittest. What
has evolved is what works best’. One wonders whether the MBA’s subcontractor
members anxiously awaiting long overdue payments for work done could not
imagine a better world and it would be interesting to imagine the response had
a similar initiative come from the union side. On the other hand we have parasitology as, ‘the CFMEU has militantly imported its ideology into a highly
pragmatic, free enterprise industry . . .’ and ‘union motivation is not altruistic
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but is aimed at buying the loyalty and obedience of rank and file union
members at the expense of the Australian community’. 47
Both the MBA and AI Group wanted a construction industry taskforce to
investigate and report breaches of various laws (and the MBA wanted it to have
enforcement powers). Both, and in particular AI Group, wanted to strengthen
the Commission’s role through a major projects tribunal or division within
the Commission to deal expeditiously with issues. Further claims included
amendments to the 1996 Act to outlaw protected action furthering pattern
bargaining, and stamp out coercive conduct and ‘inappropriate’ workplace
behaviour. Both called for much more rapid judicial responses to unprotected
union action with the MBA intent that these matters go directly to court and
that ‘penalties for unions and their officials [be] commensurate to the commercial
loss suffered by employers as a result of unlawful and inappropriate [our italics]
action’. Moreover, AI Group called for changes to the 1996 Act to allow project
agreements that would bind all subcontractors for the life of major projects. This
would answer the lack of fit, for employers (and unions), between enterprise
bargaining and the industry’s dominant subcontracting model. AI Group also
urged that protected action not be available during negotiation of project
agreements and that such agreements include an enforceable ‘no extra claims’
commitment.48
Given that letting of contracts to subcontractors would follow such project
agreements, the making of project agreements would precede the hiring of most
of any project’s workforce. This, together with restrictions extra claims and on
pattern bargaining, would effectively deprive all employees on major projects
(and by extension, in the wider industry) of the right to strike. It also would deprive
them of any say over project agreements they were to work under and of the
ability to set a reasonable industry-wide floor under those agreements. Given skills
shortages and in the absence of the right to strike, another outcome would be
greatly increased labour turnover and the (often ignored) employer costs involved.
AI Group argues that such an abrogation of fundamental democratic rights of
employees is in the public interest, which they clearly equate with the interests
of property developers and commercial builders. Fundamental to this is that they
are opposed to pattern bargaining because it allows employees to better their
wages and conditions.49 Unlike AI Group, the MBA rejected the necessity of
project agreements in favour of ‘choice’. This may reflect the MBA’s much
stronger membership base among smaller sub-contractors.50
As journalist Nicholas Way pointed out, all this runs against associations’ usual
agenda for lessening tribunal powers.51 It again suggests that association policy
makers wish to outlaw bargaining when it might be tough and want employee
dissent criminalised. Where unions are strong, there should be lots of law and
tribunal activism to curb or crush them. Where unions are weak or nonexistent, then laissez faire—to employers—should prevail. Cole and Abbott
have not disappointed employer associations. Cole’s interim report in August
recommended the industry taskforce and Abbott complied, staffing it with
people experienced in criminal investigation and prosecution. Its very generous
funding contrasts markedly with this government’s extreme tight-fistedness
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regarding occupational health and safety (OHS) research. Again criminal and
‘inappropriate’ activities are on the agenda and the taskforce seems particularly
intent on getting at unions through the industrial relations policy nexus between
head contractors and their subcontractors.52
Cole (partially) accepted union claims regarding OHS and there is a hope
that this may lead, eventually, to a national OHS regulatory framework. He also
entertained union complaints about security of payments to sub-contractors, sham
categorisation of employees as self-employed or subcontractors with consequent
tax evasions, non-payment of workers’ compensation premiums and nonpayment of employee entitlements. On these issues employer associations were
near to silent, jeopardising future opportunities to take the high moral ground
in arguing their legislative case before a skeptical Senate.53
Most hypocritical though was the insistence of associations that employers—
not employees and their unions—should control the selection of site safety
representatives. The pretext was disengaging workplace health and safety from
industrial relations (and union power) even though it is precisely this nexus that
has so greatly improved OHS in this and other industries. AI Group even argued
for managerial prerogative because ‘(E)mployers carry the risk for OHS on a
project’.54 Mortality and injury statistics would suggest the opposite as would
successful employer association pressure against industrial manslaughter bills.
One of the MBA and AI Group’s principal alternatives was for government
inspectors to get greater powers and to display greater activism. This is contrary
to evidence from the industry’s history and of contemporary developments in
other countries. What made it even more remarkable was that, in the Queensland
context, AI Group protested against a proposed legislative extension of government inspectors’ powers that flowed from the Crittall Review.55
Cole is to report in late February 2003. His royal commission operated in
the context of an almost unheard of boom in building and construction in most
capitals, record company profits and severe skilled labour shortages so that any
action is likely to bring union reaction.56 During 2002, building unions defiantly
launched their 36 hour week campaign. To the irritation of AI Group and the
New South Wales MBA, unions also won industry pattern bargains in Victoria
from the National Electrical Contractors’ Association and from the Victorian
MBA. In particular, that with the MBA means that Victorian industry expiry dates
mesh with those in the rest of the country.57
FIGHTING
MAJOR TEST CASES
Reasonable hours test case
Employer associations maintained their strident opposition to the ACTU’s
(un)reasonable hours test case before the Commission. They continued their
arguments from 2001, focusing on costs to employers, the claim’s allegedly rigid
‘one-size-fits-all’ approach, the potential for greater litigation and, increasingly,
lost overtime earnings for employees.58 ACCI and AI Group, which both invested
heavily in fighting the case, described it as a reversion to ‘days long gone’ of
centralised regulation, undoing more than a decade of greater enterprise focus
and flexibility.59 This was, of course, the ACTU’s objective given growing
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evidence that large numbers of employees are working longer hours, that these
hours are increasingly unpaid and that they are unhappy about it.60 Associations
were very pleased that the Commission rejected all the ACTU’s main claims and
merely clarified employee rights to refuse unreasonable overtime.61
Less reassuring were Commission findings about escalating hours of work and
their effects on employee health and lifestyle. Unions have clearly signalled
that work–life balance is a central claim both through enterprise bargaining and
campaigning for statutory paid maternity leave (see below). Strategically, this
may force employer associations to choose between championing ‘good
employers’, at the expense of more exploitative ones on issues such as unpaid
overtime, or face insurmountable community pressures for tighter legislation
affecting all employers.
Safety net
When the ACTU launched its 2002 ‘living wage claim’ for a $25 weekly wage
increase, the confident prediction from BRW to the business community was for
only a modest increase. Employer groups generally supported a $10 increase.62
Beyond that consensus, their positions diverged. AI Group joined the federal
government in arguing that, rather than increasing nominal wages, debate
should focus on delivering higher real incomes to wage earners through adjusting
taxes and welfare. AI Group effectively countered ACTU arguments that this
sounded like a wage freeze. It pointed out that tax payments and loss of welfare
benefits would erode any gains coming from a living wage increase and that the
ACTU should not delude its employees otherwise.63 This was the second
consecutive year that ACCI followed a more realistic course. In calling for
a ‘responsible, conservative approach’, it reiterated its mantra that any wage
increase should be linked to productivity growth. In this case, any increase
above $10, would fuel unemployment and inflation, and be a disincentive to
enterprise bargaining.64
Employer groups were unhappy with the Commission’s June decision to
award an $18 safety net increase but it was the Commission’s reasoning rather
than quantum of increase that most unsettled them. The Commission had largely
rejected their pessimism concerning the macro-economic effects of wage
increases and their proposed wage fixing criteria. Attacking the decision as ‘out
of step with the IRC’s role in wages policy’, ACCI warned of dire consequences
for the economy and the low paid.65 Divergences in employer stances have continued in early responses to the ACTU’s recent safety net claim for 2003. ACCI
has stridently opposed the wage claims for low paid workers, as ‘excessive and
ambitious’, and displaying a ‘certain element of opportunism’ by the ACTU. Once
again, AI Group has raised the poverty trap argument as well as arguing that
the ACTU has understated the impact of flow-on costs of wage increases for
employers. 66
Non-union bargaining fees
Employer groups’ delight in late 200167 with Justice Merkel’s Federal Court
Electrolux decision excluding non-union bargaining fees from certified agreements
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was short-lived. In June 2002, a Federal Court full bench found that unions could
take protected industrial action in support of genuinely made claims, including
bargaining agents’ fees. Describing the decision as ‘an example of judicial activism’
that provided a back door for compulsory unionism, ACCI called on the government to reassert ‘control’ over the 1996 Act through immediate legislative
reversal of the Court’s decision.68 On behalf of Electrolux, AI Group appealed
to the High Court principally on the ground that paying bargaining fees to a
third party was not part of an employment relationship and this matter will unfold
during 2003. Calming employers’ fears over the Federal Court decision, the
Commission subsequently refused to certify numerous agreements that contained
bargaining fee clauses. In this, Deputy President Hamilton was prominent,
winning hearty applause from employer bodies and provoking an appeal from
unions. AI Group and the federal government defended the unsuccessful appeal
as a full bench confirmed Hamilton’s position.69
Seeking to forestall union claims for such fees in the New South Wales
jurisdiction, following failed union attempts before the South Australian and
Queensland tribunals, ABL joined with the National Electrical Contractors
Association to lobby for inclusion of an anti-bargaining fee principle in the
enterprise agreement approval process in New South Wales. While unsuccessful,
the resultant principles provide an opening for employers to argue against the
inclusion of bargaining fees on a case-by-case basis.70
Termination, change and redundancy
Employers’ interest in the issue of employee entitlements shifted in 2002, from
how best to protect entitlements in cases of corporate insolvency to the question
of employees’ entitlements in situations of termination, change and redundancy
(TCR). This shift followed the ACTU’s claim before the Commission for
improvements to minimum award entitlements established in the 1984
Termination, Change and Redundancy Decision. The ACTU’s re-embracing of TCR
issues was strategically timely given the number and seriousness of high profile
staffing contractions in 2001, the string of sensational corporate failures and the
tentative resolution of the employee entitlement issue through a scheme the
federal government introduced in late 2001. Echoing the current situation in
New South Wales, the ACTU’s claim included demands to double the minimum
severance pay entitlement from 4 to 8 weeks, compensate employees aged over
45 years for their reduced employment opportunities, extend the entitlements
to casual employees, and include small businesses. Although Commission hearings
were not to begin until 2003, the ACTU’s claim sparked a flurry of employer
activity, which intensified when the matter reached test case status in Queensland.
Employers displayed remarkable unity in their responses to the TCR claim.
Almost with one voice, employer groups rejected extending TCR entitlements
to casual employees, improving entitlements for those over 45, and roping in
small businesses—apparently the issue causing greatest disquiet. Their counter
claims differed in nature, although not in sentiment. In response to a request
from the Queensland Commission, Commerce Queensland proposed a considerable increase in minimum severance pay entitlement, to up to 10 weeks pay
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but continued to fully oppose all other union claims.71 AI Group proposed that
awards be amended to include separate provisions for insolvency-based redundancies and those for other reasons. AI Group also suggested greater protections
for employers, including explicit exclusion of redundancy entitlements for
employees in cases of transmission of business—an issue at the heart of a
continuing dispute that began when the Commonwealth Bank outsourced
information services functions to EDS in 1997.72 Given that the ACCI blueprint
talks of employers having a fundamental right to restructure business without
third party interference, it is not surprising that ACCI’s counter claim went
further than other employer groups’ in claiming unfettered management rights
to cut labour. However, since then, ACCI also proposed that longer service
periods be required for eligibility to TCR entitlements and employers in
depressed or failing industries be allowed to seek exemption or reduction from
redundancy payments when unable to pay. At the very end of 2002, conciliation
before the Commission brought agreement on some issues between AI Group
and ACCI (representing employers) and the ACTU but important differences
remain for resolution during 2003.73
Association determination in pushing for enhanced employers’ TCR prerogatives seems rather disingenuous when placed alongside other events and
developments in 2002. While there were fewer high profile staffing contractions
and scandals over executive salary levels in 2002 than in 2001 (and even signs of
some moderating in executive pay rises) there were enough to keep fuelling
public disquiet. One of the most publicised cases was that of AMP which
announced several rounds of large-scale retrenchments in 2002 but suffered
embarrassing speculation concerning a rumoured 20 million dollar termination
payment to its (sacked) chief executive.74 Perhaps the most sensational case
demonstrated the lengths to which some employers will go to avoid paying
employees’ entitlements. In March, Coogi Nominees transferred 240 employees
to shelf companies with no assets, effectively denying them their accrued entitlements when it went into liquidation. In the Federal Court, Justice Merkel
scathingly charged the company with treating its employees like ‘serfs rather than
free citizens’, and, ruled that it could not arbitrarily transfer employees to another
company without their assent.75
PAID
MATERNITY LEAVE
During 2002, employer groups intervened strongly in the debate on paid
maternity leave. Most major employer associations submitted lengthy responses
to the Sex Discrimination Commissioner’s interim report, Valuing Parenting,
published in April. They also contributed vigorously to subsequent intense
media debate until the final report, Paid Maternity Leave: A Time to Value, in
December. Of greatest concern to employers was the question of who would
fund paid maternity leave. Not surprisingly, they were united in opposition to
any compulsory employer-funded scheme. If paid maternity leave was to become
an employment benefit, employer associations argued, it should be funded as an
additional payment through the social welfare system. The National Farmers’
Federation even opposed that, calling instead for a redistribution within the
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existing family welfare budget.76 For its part, ACCI remained unconvinced that
paid parental leave was the most equitable and efficient means of delivering social
support for parenting, and it criticised government-funded schemes overseas,
claiming that they provided a disincentive to employment. Throughout the year,
some employer associations, essentially (but unfashionably) opposed to paid
maternity leave, fanned the flames of fear, particularly among small and medium
employers, by suggesting that the review would recommend that employers carry
this financial burden.77
ACCI, AI Group and ABL were particularly anxious that any new maternity
leave scheme should include protection for employers against industry-wide union
campaigns and Commission test cases to extend maternity benefits. Again
arguing against ‘one size fits all’ policies, they insisted that additional benefits
should derive only from enterprise bargaining: any compulsory topping-up
through the industrial relations system should be prohibited. ABL proposed
that the federal government exclude paid maternity leave as an allowable award
matter, to preclude unions winning above test-case standards in awards.78
Mysteriously, given the facts, ACCI also viewed the current universal unpaid
leave entitlement of 12 months as extremely generous by international standards.
Accordingly, it also criticised, as ‘utterly impractical’, a foreshadowed ACTU test
case to extend unpaid maternity leave entitlements to three years (or five years
through negotiation) and provide other benefits in terms of access to part-time
work, family-friendly rosters and flexible annual leave options. When the ACTU
refined its claim, for example reducing the leave entitlement sought from three
to two years, ACCI Chief Executive, Peter Hendy countered by asserting
that Australia ‘does not have the luxury to fiddle around with this narrow
agenda’.79
By recommending that the government fund a 14-week paid maternity leave
scheme, the Sex Discrimination Commissioner’s final report allayed employers’
greatest fears. Once again, there were also differences among associations.
While AI Group’s Chief Executive Bob Herbert applauded the report, ACCI’s
Hendy damned it with faint praise and criticised it for failing to close the
door on emplo