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Today’s media continues to run with reports of union corruption and the forceful extraction of money from businesses. This includes the ABC and Fairfax, which will now find it harder to oppose fundamental reforms (although they will doubtless try). The basic problem is well set out in the article below from The Australian and in the these transcripts from the last two 7.30 reports. I have also had some success in four letters columns (see below).

The key point is that, under present laws and their administrative bodies, unions are capable of unjustifiably disrupting activities of businesses and businesses are forced to pay for peace – the idea that they can always say “No” just doesn’t apply under existing regulatory arrangements.

The question is whether the Abbott government can institute fundamental reforms when they said pre-election they would not make major changes this term. They have already announced important changes, including the establishment of an appeal body against Fair Work decisions, changes to union entry rights and participation in greenfields agreements, and the restoration of the ABCC plus a Productivity Cn review. With these exposures by the ABC/Fairfax there is potential to argue that the new revelations show a situation much worse than was realised pre-election and hence additional legislative changes (particularly in relation to strikes, walkouts, etc) are justifiable.

Any such attempt should be preceded by the publication of an analysis of why much less regulation is needed and that, while unions have a role to play, it should be much less today than it is.

Whether such an analysis is best provided by a Royal Commission or issued as a Green Paper is an open question. My preference would be the latter as it would be quicker and, if done properly, would have the potential to open up important issues, such as the respective parties’ bargaining power, more than a RC.

Des Moore


Business rails against call to 'just say no' to unions
(Article by Annabel Hepworth and Ewin Hannan published in The Australian, 30 January 2014.)

BUSINESS is staring down government calls to "just say no" to unreasonable union pay demands, declaring there is a fundamental problem with workplace laws.

After Employment Minister Eric Abetz accused "weak-kneed employers" of "caving in to unreasonable union demands then coming to me advocating for workplace relations reform", industry ratcheted up its insistence that reform was necessary.

Employer groups painted a picture of unions making extraordinary claims and engaging in stalling tactics. Builders - staunch advocates of the Coalition's plan for the full restoration of the Australian Building and Construction Commission scrapped by Labor - said they had an "industrial gun held to their heads".

Business Council of Australia chief executive Jennifer Westacott said while there were no doubt instances of poorly negotiated agreements on existing work sites, there was "a fundamental problem" with Labor's workplace laws.

She singled out the situation relating to greenfield sites where the negotiation of competitive agreements had been "problematic".

"Australia cannot adequately deal with the high costs of doing business, including our high labour costs, without coming to terms with the need to reform our uncompetitive, complex and flawed industrial relations laws," Ms Westacott said.

Senator Abetz was forced to defend his warning of a wages explosion if unions and employers did not act responsibly, after Assistant Treasurer Arthur Sinodinos said wages growth had slowed and was expected to remain subdued.

Economists said the comments by Senator Abetz were a "bit of a stretch" given the recent moderate wages growth.

Senator Abetz maintained that "sweetheart deals" between employers and unions that included extra entitlements "can lead to a similar situation as we had with a wages explosion". He cited the conditions agreed by Toyota that the carmaker has subsequently tried to wind back.

Opposition workplace relations spokesman Brendan O'Connor accused Senator Abetz of "making up lies about wage growth increasing".

He said ABS data showed wages were falling across all sectors and "the only reason he would make that up is to craft a story that the government needs to get up to find an excuse to cut employment conditions across the board".

As the debate about deals between employers and unions raged, business groups lined up to insist they could not "just say no".

Australian Mines and Metals Association executive director of policy Scott Barklamb said: "It's not easy for an employer to 'just say no' in bargaining when the Fair Work system was deliberately engineered to give unions unprecedented and preferential bargaining power during EBA negotiations."

He pointed to a situation where there are concerns about pay talks involving a contractor servicing Chevron's $52 billion Gorgon project. Should this lead to strike action, employers could face $1 million a day in costs.

"Australian employers . . . have to make pragmatic decisions on what is possible and cost effective, and in too many cases flaws and imbalances in our workplace relations system force employers into agreeing to less than optimal outcomes," Mr Barklamb said.

Master Builders Australia chief executive Wilhelm Harnisch acknowledged that in the construction industry costs were spiralling due to unsustainably generous enterprise agreements. But employers felt "constrained by the commercial and industrial gun held to their heads".

"It's easy to say that business should stiffen their spine but it must be understood that the building unions do not behave like normal people," he said.


ALP needs to sever ties with unions for new life
(Letter by Des Moore published in The Australian, 30 January 2014.)
[square bracketed bits deleted by Ed]

The key point is missing from the published reports of bribery and corruption in the building and construction industries: no report identified where the money came from (“Demands for union corruption as death threats emerge”, 29/1).

The answer is that, over many years and to varying degrees, the regulatory system has required businesses to provide an enormous range of working conditions which are legally enforceable by quasi-judicial bodies whose members favour union interpretations and allow aggressive action by them.

Tony Abbott supported the private sector in Davos but in Australia that sector’s labour relations are dictated by government.

In this situation unions are able to threaten disruptions to business activity unless they receive funds. [The extraction of funds by Julia Gillard’s friend is but one of many examples and] The building industry is susceptible because it can more easily “pass on” the additional cost to building owners and their users. In short, in Australia peace and free bargaining often have to be purchased.

This situation applies outside the building  industry too, albeit to a lesser degree. More importantly, much more than a judicial inquiry is needed. The bribery and corruption occurs because of the excessive regulatory arrangements which apply across the board. That is where action is needed.

Des Moore, South Yarra, Vic
[Publicity Officer
HR Nicholls Society]


Regulators still permit union extortion
(Letter by Des Moore published in the Australian Financial Review, 30 January 2014.)

The key point is missing from the published reports of bribery and corruption in the building and construction industries: not one report has identified from where the money came.

The answer is that the regulatory system has required businesses to provide working conditions legally enforceable by quasi-judicial bodies whose members favour union interpretations and allow aggressive action by them. Prime Minister Tony Abbott supported the private sector in Davos but in Australia that sector’s labour relations are dictated by government.

Unions are able to threaten disruptions to business activity unless they receive funds. The extraction of funds by Julia Gillard’s friend is but one example and the building industry can more easily “pass on” the additional cost to building owners. In short, peace often has to be purchased in Australia.

This applies outside the building  industry and more than a judicial inquiry there is needed. The bribery occurs because of the excessive regulatory arrangements. That is where action is needed.

Des Moore
HR Nicholls Society
South Yarra, Vic   


Follow money trail
(Letter by Des Moore published in The Canberra Times, 30 January 2014.)

The key point is missing from the reports of bribery and corruption in the building industry - no report identified from where the money came.

The answer is that the regulatory system has required businesses to provide working conditions legally enforceable by quasi-judicial bodies whose members favour union interpretations and allow aggressive action by them.

In Davos, Prime Minister Abbott voiced his support of the private sector but in Australia that sector's labour relations are dictated by government.

Unions are able to threaten disruptions to business activity unless they receive funds. The extraction of funds by Julia Gillard's friend is but one example and the building industry can more easily ''pass on'' the additional cost to building owners.

In short, peace often has to be purchased in Australia. That must be changed.

Des Moore, HR Nicholls Society

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