How The Judiciary Continues To Undermine Labour Market Deregulation

Australian Bulletin of Labour
Vol.31 No 1, May 2005
National Institute of Labour Studies
Flinders University, Adelaide.

By Des Moore

The attached article was published last week - below is the Abstract of the article.
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Despite improved economic growth, participation rates have not increased in recent years and Australian employment/population rates continue below those in comparable countries when they should be above. The existence of two million or so who would like more employment suggests much more potential for increasing employment than the official unemployment figures.

Various factors contribute to this situation. But the general approach of "judicial" decision-making in employer/employee relations is having serious adverse effects on employment decisions. The basis of such decision-making reflects erroneous assumptions and beliefs, including that tribunals and courts have social policy responsibilities independently of Parliament, that there is an imbalance of bargaining power between employers and employees, and that courts have the capacity to make informed judgements about the workability of employment contracts.

Particularly (but not only) in the AIRC, such mistaken assumptions have intruded increasingly without taking proper account of contrary influences that in a modern society should be reflected in the basis of decision-making. These influences include the evident intent of the Workplace Relations Act of 1996 to put less emphasis on judicially-determined employment conditions, the implications of the continuing development of a competitive economy - with educated citizens increasingly able to make their own economic decisions - and the increasing role played by government in providing social security for those on low incomes. Such influences should combine to mean that employers and employees are left generally free to negotiate employment conditions with minimal judicial interference.

Unfortunately, an examination of recent decisions, especially those by AIRC commissioners, indicates increasing interference or failure to interfere when obviously necessary. Such decisions have included failures to protect employers against violent and intimidatory union action, a widening in the definition of industrial action so as to allow more arbitration, an extension of the circumstances in which unions have the right to strike andto enter business premises, a widening of the safety net beyond itsobjective, an apparently less favourable treatment of non-union agreements and an increasing attempt to restrict employers' use of non-union labour.

A major political response is needed. This could include a wholesale revision of the legislation and a conversion of the AIRC into a mediatory body with no legal powers of arbitration or intervention. It would be timely to make such a change in circumstances where that body has completed one hundred years of regulation.