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Jun 29, 2011

Liberals in search of the case for IR reform

Since IR reformers won't explain why we need it, we've looked at what WorkChoices accomplished. It wasn't much.

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Now that Tony Abbott has been forced into an industrial relations policy — recall that he literally had no policy on the issue last year, in a mostly successful attempt to defuse the threat of WorkChoices — it will be intriguing to see how the Liberals sell the need for industrial relations reform.

As Crikey has repeatedly pointed out, so far Labor’s IR framework has accommodated the return to near full employment without any surge in wages growth or rise in industrial disputation levels. Under the Fair Work regime, the economy is producing hundreds of thousands of jobs with no wages explosion and no surge in strike action as workers and employers tussle over the spoils of the recovery.

Rather than deal with actual data, IR reform advocates have retreated to nebulously claiming that the Fair Work regime is hampering productivity, although without providing examples. A classic case is Alan Mitchell’s op-ed piece in today’s AFR (which, even more than The Australian, reflexively advocates IR reform without any evidentiary basis). “Gillard’s industrial relations reforms will add something  to wage inflation,” says Mitchell, but provides no further elaboration or evidence to back it up.

The only IR reform advocate to try to furnish an example has been veteran conservative spinner Ian Hanke, who in writing for the HR Nicholls Society claimed Fair Work Australia’s decision on 90 minute shifts demonstrated the inflexibilities of the current system. The problem is, the decision demonstrated quite the opposite, which is why employers welcomed it.

What about other examples of the problems of Fair Work? Well, Hanke didn’t wish to, or couldn’t produce, any. He tries to link the number of long-term unemployed and under-utilisation of labour to the current regime, without acknowledging that other factors, like the continuing decline of the manufacturing sector, or the flatness of the retail sector, might also account for under-utilisation.

Reform advocates cite no less an authority than Productivity Chairman Gary Banks on the importance of IR reform. And indeed, last December, Banks declared that IR regulation was crucial to productivity. It is “vital to ensure that regulations intended to promote fairness in Australia’s workplaces do not detract unduly from their productivity,” Banks said. Well, indeed — this is merely a statement of the obvious. But Banks didn’t give any examples either.

Indeed, he doesn’t specifically address the Fair Work framework. Banks’s biggest complaint about IR reform is the lack of regulatory impact statements made for them — a complaint that could be directed more at the Howard government, which treated its own RIS requirements with casual contempt, than the current government.

Labor in office has further strengthened RIS requirements — which perversely are some of the most productivity-sapping internal requirements that public servants face — without any clear benefit, primarily because the RIS process is a particularly elaborate game of tickabox that does nothing to constrain politicians’ desire to regulate.

If IR advocates can’t produce any evidence to back up their calls for reform, let’s reverse the argument and look at what the last round of reform accomplished. WorkChoices was in place for two years, from March 2006 to March 2008. It was the all-you-can-eat option for IR hardliners, unconstrained by Senate crossbenches or, as it turned out, political common sense. What did it accomplish?

First thing to note is that there was a reduction in industrial disputation under WorkChoices — unsurprising, given it was a direct assault on unions and the right to strike. Under WorkChoices, days lost to industrial disputes fell to their lowest level ever record. But, interestingly, they did so in the December 2007 quarter, when the number of days lost was 49, 700. The previous quarter, September 2007, was the second lowest ever, 79, 600 days. Was the nadir of industrial disputation caused by WorkChoices, or by the union movement holding its fire to ensure nothing would endanger a Labor victory? The industrial dispute figures for the first year of WorkChoices are at the same level of higher than current levels under Fair Work.

And some historical context is needed. Just how big a problem is industrial disputation now? Let’s look at days lost to industrial disputes going right back to the time of the Accord and Bob Hawke:

So industrial disputation is now not even the issue it was in the wake of Peter Reith’s reforms in 1997.

What about the cost of labour? This is the ABS’s index for private wages, excluding bonuses, since 1997.

This entirely boring line shows little difference between the rate of private sector wages growth now and under WorkChoices or, for that matter, before WorkChoices. The only interruption to the smooth increase was the impact of the GFC.

What about the more nebulous issue of productivity? Were Australians made to work harder under WorkChoices? That’s the logic coming from IR reform advocates, that more “workplace flexibility” means higher productivity. In February, the Grattan Institute examined the problem of Australia’s falling productivity, finding inter alia that the problem was economy-wide rather than, as some have suggested, a particular problem occasioned by the massive increase in capital investment in the mining industry and utilities.

While the report doesn’t explicitly consider the issue of IR reform, its data on productivity gives us a snapshot of productivity under WorkChoices. The Institute’s five-year rolling average trend for productivity shows that, for the two years of WorkChoices, labour productivity in Australia fell off a cliff, fell further in 2009, and has since recovered slightly.

Now, one can argue that WorkChoices wasn’t given long enough to really yield significant benefits, that a two-year experiment wasn’t long enough, and cruelled by the Howard government reimposing a safety net feature under political pressure. And there’s a case for arguing that the big drop in productivity under WorkChoices was more because of capacity constraints in a booming economy and the entry into the workforce of lower-skilled, less productive workers because employers faced a tight labour market — as long as you’re prepared to identify the same contextual factors at work under the current system.

But the problem is that IR reform, as the chart for industrial disputes shows, is now the lazy reform option. Attacking unions’ rights and empowering business to gouge unskilled workers — the two basic features of WorkChoices — aren’t going to restore Australia’s flagging productivity. The Hawke, Keating and early Howard government got all the low-hanging reform fruit.

Now there are more complex challenges like infrastructure investment (and charging for infrastructure), lifting the return from our health and education investment and the “human capital agenda” which the Howard government, under pressure from the Bracks government, belatedly recognised as important to lifting productivity.

That said, there may indeed be a case for overhauling aspects of the Fair Work regime. No legislative framework is perfect. The problem is, IR reform advocates keep insisting it’s broken, but can’t or won’t say how or provide any evidence for it.

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42 thoughts on “Liberals in search of the case for IR reform

  1. Cuppa

    The Liberals – WorkChoices yesterday, today and forever!

  2. billie

    Is “Productivity Chairman Gary Banks” the same Gary Banks who ran a successful professional personnel placement firm up until the 1990s?

    I dispute that Australia has returned to near full employment because the unemployment rate is determined as people who were actively looking for work did not have an hour of work paid or unpaid in the survey period. The ABS also keeps track of underemployment, recognising that many “employed” rely on Newstart of $234 per week to provide and income or top up their income.

    About 25% of Australian workers are employed casually, yes it includes university students working in retail and hospitality but also many professional people who are hired at the start of a shift like nurses, teachers and miners. These workers the requisite training, registration and experience are expected to perform their duties in a professional manner. Casual teachers in Victoria are paid $256 per day but after paying agency fees they are likely to take home $176. They deserve a better deal than the proposed by HR Nichols Society.

  3. Pamela

    DIRECT ACTION IS A FIZZER so back to core business arguing that the screws be applied to workers.
    As it is Australians now work longer hours than many other countries, the weekend is dead, our kids are working 2 and 3 jobs with no security as a standard.
    WHAT MORE DOES REITH WANT?

  4. freecountry

    The problem is, those comforting economic indicators you cite, such as full employment and low (official) inflation, are caused not by productivity improvements but by things like resource price increases and immigration. Look beyond those figures to “total factor productivity” (TFP, i.e. cancelling out the effects of changes in population and global markets) and it’s a different story, as RBA Assistant Governor Philip Lowe said late last year.
    [“But of course, everything else is not constant. In particular, total factor productivity growth has slowed significantly over the past decade. Indeed, according to the national accounts, almost all the growth in output since the early 2000s has been accounted for by growth in labour and capital inputs, rather than by improving the way we use that labour and capital.”]
    (( rba.gov.au/speeches/2010/sp-ag-081210.html ))

    Without TFP improvements, Australia is just riding the currents and hoping our luck lasts. TFP can potentially be increased by microeconomic reforms such as smoothing out tax distortions and increasing labour market flexibility, and by investing strategically in common productive assets such as transport infrastructure and better urban design. If done right, the effect of these is to maximize economic competition throughout the system–including both competition for the best workers and competition by workers for the best jobs–and it is competition that leads to real productivity increases.

  5. david

    @ FC […The problem is, those comforting economic indicators you cite, such as full employment and low (official) inflation, are caused not by productivity improvements but by things like resource price increases and immigration.]

    I notice FC you conveniently ignore the almost halt in stoppages due to industrial action and the very modest rise in rates of pay. Conveniently apple picking those that suit your line huh?
    Excellent article Bernard and there is no doubt Abbott has two fronts attacking him now, the Reith mob and the Turnbull mob. His continual lies and negativity will be the undoing of him.

  6. Jimmy

    FC – “almost all the growth in output since the early 2000s has been accounted for by growth in labour and capital inputs” So neither work choices nor the previous system and current system have had an impact on productivity. Wouldn’t this indicate that investing in infrastructure like high quality broadband or as you suggest transport and urban design has more of an impact and therefore this is where we should be concentrating?

  7. Rob

    WorkChoices was wonderful because it inadvertently revealed the true face of the Liebral/Nasty Party – well off people resenting workers being paid a fair wage because it reduces income to them, to shareholders and to other parasites on the rotting corpse of Fundamentalist Capitalism.

  8. rossco

    When the Libs and employers talk about IR reform they mean slashing wages and conditions for workers and wiping out unions. This might reduce labour costs and increase profits but doesn’t increase productivity. Real long term increased productivity comes from investing in infrastructure, new technology, training, improved occupational health and safety, changed work practices and giving workers the opportunity to have real input into how productivity can be improved. The problem for employers is that requires them committing to expenditure up front for long term gains and that might mean they miss out on this years bonus. Where is the vision?

  9. ronin8317

    The high Australian dollar pretty much condemns to death the Australian manufacturing industry, and why would anyone invest in an industry when you can become much, much richer by selling real estate? Note that the productivity decrease started around 1999/2000, which is also when the real estate bubble took off.

    My boss has been running a small IT company for 30 years. For the last two year, he switched his focus to building an apartment block instead. He’ll probably reap more from the block of apartments than what his IT business made for the last 30 years combine. Something definitely isn’t right with this scenario.

  10. Damien

    The reason there’s been no wages blowout or increase in industrial disputes since the FWA arrangements came in seems to be because it’s not that good for workers and there’s not that much left to do.

    Employers have enormous scope to exploit vunerable employees. For example, I understand enterprise agreements are not reviewed to assess potential disasdvantage on adoption, only if challenged through arbitration. That’s a potential bonanza for SMEs employing the young or disadvantages who are generally unempowered in industrial issues. Fair Work has done little to address that issue.

    Even the unions, for all the talk, appear uninterested. Young kids entering the workforce and marginalised, disadvantaged groups have few friends in IR these days, including the Labor Government. how’s that for labour market flexibility.

  11. Jimmy

    Ronin – Given the flat real estate market at the moment he might also be stuck with unsold apartments.

  12. Jenny Haines

    Have we forgotten that we live in a capitalist society? The system is not broken. Big business wants to minimise labor costs and maximise profits. That’s what our system is all about isn’t it? Trouble is that this model takes no account of the social cost, or industrial rights on employees. We can continue to have business drive down employee costs til we reach third world wages and standards of living , and there are already some examples of that – the workers that the AWU discovered working on oil wells for $3 an hour. To be fair, the Fair Work Ombudsman is prosecuting the complex maze of employers and financiers of this project. Interesting to see what the courts do with the case.
    But do Australians want a low wage , low skill, so called “high productivity” economy? In my own area of work, nursing, this means unskilled, undereducated workers working in areas beyond the level of their knowledge, skill and experience. It can mean very poor standards of care and patient morbidity and mortality increasing. But hey, if productivity is high ( and the measurement of productivity in health services is not easy!) all must be good with the world!! The only organisations that can act as an effective brake on this are unions if they are able and want to, but they are in a very strange place now, partly of their own making, due to the Accord, the post Accord years, close relationships with Labor Governments, the restrictions of Workchoices and the huge amalgamations.

  13. freecountry

    David:
    [I notice FC you conveniently ignore the almost halt in stoppages due to industrial action and the very modest rise in rates of pay.]
    Make that, no rises at all in aggregate rates of pay compared to the trend line. I notice you ignore the meaning of the second graph in the article. If the purpose of Labor’s industrial reform was to transfer wealth from the owners of capital to the labour force, it doesn’t seem to be working.

    That depressingly linear graph is consistent with a claim I made in another thread that political or monopolistic control of wages in one sector transfers wealth out of the hands of whatever sector has the least power, which is usually not the owners of capital, but other labour sectors which don’t have political connections or the power to shut down production. It’s a zero sum game for the labour force overall.

  14. Jimmy

    FC -“If the purpose of Labor’s industrial reform was to transfer wealth from the owners of capital to the labour force, it doesn’t seem to be working.” The purpose was not to transfer wealth it was to protect workers rights.

  15. david

    [Author: Damien
    Comment:
    The reason there’s been no wages blowout or increase in industrial disputes since the FWA arrangements came in seems to be because it’s not that good for workers and there’s not that much left to do.

    Employers have enormous scope to exploit vunerable employees. For example, I understand enterprise agreements are not reviewed to assess potential disasdvantage on adoption, only if challenged through arbitration. That’s a potential bonanza for SMEs employing the young or disadvantages who are generally unempowered in industrial issues. Fair Work has done little to address that issue.

    Even the unions, for all the talk, appear uninterested. Young kids entering the workforce and marginalised, disadvantaged groups have few friends in IR these days, including the Labor Government. how’s that for labour market flexibility.]

    Damien there are not many workplaces in the country that do not have access to a Union, however to get support from a Union in any dispute with employers an employee must be a member of said Union. There is of course nothing to stop an individual worker from taking a dispute with their employer to a dispute tribunal

    Section 5.2.5 of the Fair Work Act says..

    5.2.5 For a procedure to be considered a “genuine dispute resolution procedure” it must include as a minimum:
    the ability for employees to appoint a representative in relation to the dispute;
    in the first instance procedures to resolve the dispute at the workplace level;
    if a dispute is not resolved at the workplace level, the capacity for a party to the dispute to refer the matter to an independent third party for mediation or conciliation; and
    if the dispute is still not resolved, the capacity for an independent third party to settle the dispute via a decision binding on the parties.
    5.2.6 The dispute resolution mechanisms set out in Schedule 6.1 of the Fair Work Regulations 2009 are an example of a ‘genuine dispute resolution procedure’. They provide for the representation of employees and the settlement of the dispute by Fair Work Australia if discussions at the workplace, and mediation or conciliation by Fair Work Australia, have failed to resolve the dispute. …

    Of course being a Union member negates that solo need and gives one, full protection and cover from the Union who will negotiate on the employees behalf. However many workers still prefer not to pay a small Union fee, based on their income, and ride in on the coat tails of paid up members, when workplace enterprise agreements negotiated by their Union are made.

    Employers are not all bad, however they exist and bullying and threats will silence young inexperienced employees. They need to sum up the pros and cons of losing a few dollars a week in Union fees, or join and get the many advantages which include all manner of benefits. Unions shouldn’t be judged on one or two loud mouthed, pot bellied, pushy, individuals, they are very much the minority.

    I have been a Union delegate most of my working life including terms on a National Executive. Not many cases taken to arbitration on behalf of a worker , when negotiation doesn’t solve the issue, are lost. Most have good cases that are winnable. Usually when a dispute gets to that stage, an employer is being unreasonable or has a case to answer. I go back to my original observation the vast majority of employers are reasonable and fair.

  16. david

    [If the purpose of Labor’s industrial reform was to transfer wealth from the owners of capital to the labour force, it doesn’t seem to be working.]

    FC I do not recall reading the Fair Work Act that implication being mentioned anywhere.
    The Govt wants workers to receive an agreed negotiated fair wage for a fair days work. Safe, clean working conditions, fair leave entitlements and the ability to have something done about it, if employers are being non compliant. Communism is not part of the present Govts agenda.

  17. Liz45

    If big business could get away with not paying workers at all, they’d do it. For Reith and others to assert that there’s a problem requiring tightening up the labour market etc, they should be made to spell out why. Who’s surprised that Abbott is speaking of industrial relations ‘reforms’? He’s a self confessed liar – WorstChoices is not “dead, buried and cremated” it’s just been put in the freezer. I predict that his public assertions(policies) will be much different to what actually takes place if he’s elected.

    Look at what the Libs have done in Victoria and NSW? It took O’Farrell less than 3 months to put the boot into some of the hardest working and lowest paid people in the country – essential services all? Then he insulted our intelligence by the statement, that he’d cap politicians salaries to 2.5 %? As I said at the time, when nurses receive the same incomes as a back bencher, then he can talk about them being in the same boat.

    WorstChoices had the most negative effect on women and the young. There’s been several extensive inquiries about the negative impacts. When WorstChoices was coupled with forcing sole parents(mostly women) back into the workforce when their youngest child turned 6 or 8, the stresses were multiplied many times. There was no extra child care or after school hours child care places made available. In fact, in one area in the Illawarra, perceived to house people with low incomes or only Centrelink payments, a before and after school hours centre lost their funding.

    We got an insight into the plight of workers who suffer sexual and other forms of discrimination via the young woman from David Jones. After the publicity of that case, the percentage of complaints rose sharply. The other impediment on women and young workers was the removal of the unfair dismissal access. However, this back fired somewhat, when workers took their employer to a higher Court than they’d have been entitled under the IR Law prior to Howard’s removal – serves them bloody right!

    Perhaps the most hideous aspect of WorstChoices, the ABCC is still in operation. It is an absolute disgrace, that a person could be jailed for 6 months for refusing to discuss what happened at a Union meeting, or a hefty fine and jail term to also discuss it with your husband/wife. We should all be ashamed of this disgraceful situation. Even mass murderers have more rights than one group of Australian workers.

    The numbers of workplace accidents and deaths are lower when workers are involved with their own safety issues, and have a voice in either reporting unsafe situations and/or taking appropriate action re prevention and if necessary legal action. Howard and Abbott’s WorstChoices took the axe to this vital aspect of peoples’ working lives. Give Abbott the nod, and we’ll be back there again – maybe even worse than before.

    Before the 2004 Election, Howard said the Unfair Dismissal Laws would only affect workplaces of 20 employees and less. After the election, he raised it(without a Plebiscite) to 100? Has anyone heard of this being put to Abbott, or Reith or Howard or???Of course not! I’ve never trusted them, I never will, and thankfully, I have a good memory. Being involved in a Women’s Health Centre, I learned first hand of the imposition and awful stress of female workers. The Conservatives collective misogynist attitudes are at the forefront of my memory. Look at Reith’s attitude to parents and kids(children overboard?) – he’ll use whatever it takes, and Abbott is worse!

    I’m looking forward to the ACTU and other Unions getting fired up over this latest development. I’ll be right there beside them – even though I’ve been out of the workforce for 27 years!(through no fault of my own, I might add?).

  18. william magnusson

    this is what happens when you encourage the guy to run for pres then sell him a dump….reithy just threw a hand grenade to abbott and its ticking

  19. The Pav

    I am waiting for Abbott to be called truly into account for his deceit.

    If Alan Jones can call the PM “Juliar” will he say Traitorous Tony?

    Abbott deceived Reith then because he is so untrusted by his own party had to show his ballott tothe incumbent to prove he had not betrayed him.

    Where is the media condemnation for him being both dishonest and grossly incompetent.

    He has no redeeming features yet continues to be a protected species. If Right Wing or conservative commentators truly supported their cause they would do all they could to get rid of him so somebody with talent and etics could take his place

  20. Jimmy

    The Pav – This was front page news yesterday in the Age and on about page seven in the Sun today where it was the “third” story where the heading and first 1/3 to 1/2 dealt with it and then it moved on to other things.
    I wouldn’t be holding my breath for him to called to account by New Ltd, Alan Jones etc.

  21. Damien

    David, I support union membership but those protections (if the union can be convinced to act) are minimal. Accessing legal remedies is often not an option for those in casualised occupations such as retail hospitality and services. The fact is that “troublemakers” or those who stand up for their right (coincidentally?) don’t get rostered on for shifts.

    Not all employers are bad but there are plenty who employ casuals and who will exploit the power differential granted they have over school leavers and vulnerable workers. the FWA and even the best unions can does little more than workchoices to protect people in that situation.

  22. Liz45

    @THE PAV@JIMMY – I agree with you both – depressing isn’t it? I have a belief that ‘what goes around comes around’? I’m waiting – with fingers crossed. I can’t stand Alan Jones. He looks as ugly on the outside as he is on the inside. The way he spoke to Julia Gillard was disgraceful – no respect for her position or as another human being. He’s so puffed up with his own sense of importance and his little ‘band’ of followers are just as nasty and petty as he is, and sadly, just as dangerous?

    Did either of you watch Lateline the night Tony Jones quizzed? Abbott about his meetings with Cardinal Pell? At first Abbott denied it, then he was more or less forced to confess(no pun intended). It was to do with funding for private schools, prior to the ’04 Election I think? When the program was finished, the camera stayed on Abbott, and you should’ve seen the look on his face. If looks could kill, Tony Jones would’ve been dead in his chair? Classic! It really showed the very nasty side of Abbott – I’ve seen similar since, but not as ‘deadly’ as that time – I kept the tape!

  23. SD

    Bernard you need to stop using the word “reform” as interchangeable with “change”. Reform means to make better. By reinstating the master- servant relationship, Workchoices made things worse for workers, not better, as you acknowledge in your article. This is an Orwellian misappropriation of a word, being used to disguise the true effect of the action described. This is an anti- journalism tactic (otherwise known as propaganda).

  24. The Pav

    @ Liz45

    I wouldn’t keep the tape…….too much bad karma comes from evil spirits!

    I’ve a theory.

    Right wing commentators never bah their own side..well almost never. If you are the leader of the Liberal Party your person is inviolate. Personages such as the Poisoned Parrot will sometimes makes critocal noises so they can pretend they have held them to account but its just a charade.

    Left Wing commetators whilst clearly having a bias are quite prepared to give “their side ‘ a bashing.

    The classic is Jon Stewart hoeing into Obama

    This results in intellectual atrophy of the right & the debate degenerates and it allows the Left to move to the Right to skim some votes to which it then becomes held hostage.

  25. Jimmy

    In good news Liz Jon Faine out rated Neil Mitchell in the last survey which might indicate that people want an unbiased interviewer.

    Also I live in regional Victoria and had Abbott on our local FM station today (the third time since the election I believe) doing an interview with to hosts who would both be less than25 and who’s combined intelligence and political knowledge could fit on a postage stamp and yet how many times has Tony been on Lateline or any other respected journalists program since the election?

  26. Jimmy

    The Pav – I go along with your theory but believe it is the Left commentators “fear” (for want of a better word) of being branded biased that they almost go harder at “their side” whereas the right commentators believe so utterly that their beliefs are the one true word that they don’t need to hear the other side.

  27. ronin8317

    Jimmy : they sold out even before the apartment block starts construction.

  28. david

    dAMIEN…I would with respect, dispute that,…… but there are plenty who employ casuals and who will exploit the power differential granted they have over school leavers and vulnerable workers. the FWA and even the best unions can does little more than workchoices to protect people in that situation.

    The Act does not seperate different classes of workers such as permanent, casual, part time, regardless if they are school leavers or as you put it “vulnerable workers”, I presume you mean handicapped in some way. As I previously mentioned these clear intentions of the Act are….

    (a) a genuine dispute resolution procedure is one which provides each of the following processes to resolve workplace disputes:
    the ability for employees to appoint a representative in relation to the dispute;
    in the first instance procedures to resolve the dispute at the workplace level;
    if a dispute is not resolved at the workplace level, the capacity for a party to the dispute to refer the matter to an independent third party for mediation or conciliation; and
    if the dispute is still not resolved, the capacity for an independent third party to settle the dispute via a decision binding on the parties.

    If a person is not covered by a Union, there are still other definite avenues open to them to be represented. Bullying in the workplace is a very serious charge and employers know it.

    Workchoices took away much of the protection workers enjoyed and this Act reinstates that protection, I believe in a more sensible and transparent way.
    Ask yourself how many times Woolworths and Coles have been up before a disputes tribunal? Rarely and they employ thousands of casuals and school students.

  29. Jimmy

    Ronin – There are plenty of people who aren’t so lucky, and if he was trying to sell off the plan now rather than 2 years ago he might of struggled as well, but it’s risk V reward.

  30. Liz45

    @THE PAV – I kept the tape as the info could be used at some other time. For instance, isn’t there an Inquiry into Fed Govt funding for private schools at present? I’m sure it will make it onto the news agenda.

    @JIMMY – Pleased to hear the news re Jon Faine and that other person? I have a real objection to that sort of man (Jones/Hadley/Mitchell etc)- arrogant. obnoxious, legends in their own lunch boxes; ignorant, racist, sexist and just down right rude. I’m glad I’m not their mother/s? I’d be ashamed!

    @DAVID – There have been a couple of incidents in the Illawarra involving fast food outlets and doing young people out of their proper pay and conditions. eg. one involved young people having to arrive at work prior to the time that their pay started, and they wouldn’t get paid until they had customers? Perhaps 30 min to one hour after they started work? They also had to provide their own ‘float’ and were owed quite a bit of money. Thanks to them telling their parents who then went to the Sth Coast Labor Council who took up their case/s. This happened several times while Howard was still PM. There was shock and outrage in the Illawarra over this. I sent the companies involved an email setting out my responses and I also rang them.
    The companies involved were also fined and had to pay them their full amount/s due. It was a good day when the verdict was given? I hate to think what happens to other young people that we don’t even hear about. Of course many don’t allow or frown on union membership – they’re forced to join in secret!

    I also recall reading an article a few years ago that stunned me re the accidents and workplace deaths of young people from 16-30 yrs of age. It was carried out in SA from memory and it was pretty shocking! Unless they have parents who support them, they’re out there on their own! Poor little buggars! Howard would’ve thought it was OK to treat young people like that. After all, he stated that he believed people in business should be able to be open 24 hrs a day, 7 days a week, and young people should do as they’re told etc.

  31. GocomSys

    @FC

    I am still in awe of your ability to intentionally or unintentionally either miss or misinterpret vital points raised in an article to suit your underlying philosophy! Well done, again!

    @Jimmy

    Please do not take any mutterings by “FC” seriously. Nobody else does!

  32. freecountry

    It’s a good question: why did Workchoices fail to increase productivity? Maybe because there was a gap between the principle and the implementation.

    The principle was sound: the worker’s negotiating power comes from being able to quit and find a better deal if the employer doesn’t take care of her. But that power depends on the worker having somewhere else to go, which in turn depends on vacancies being able to open up, which depends on other employers not being locked in with pattern bargains and workers who have a “right” to their incumbent jobs. The flexibility has to apply all through the system, or the worker suddenly runs out of choices and gets exploited.

    Did Workchoices achieve that kind of competitive fluidity? That’s the question.
    1. Employers were able to hide their wage statistics from employees, who in some cases have contract clauses forbidding any discussion of pay with other employees. The information asymmetry leaves many workers unable to bargain in an informed way. A good provision to include next time would be an entitlement for employees to see mean and standard deviation of the wages of their peers.
    2. The minister could order “essential services” back to work against their will or charge them with an offence. This may have been used only in rare cases, but it was an example of a cowboy attitude to improvising the legislation, amplified by the ugliness of the ABCC “star chamber” laws.
    3. The regime relied on an amazingly expansive interpretation of Commonwealth IR jurisdiction, which NSW unsuccessfully challenged in the High Court. If Workchoices had been tried in just one state instead of the whole country, we could have compared different IR regimes side by side and judged which ones really empowered workers and which ones emasculated them.

    All of this contributed to the perception that Workchoices was really for the benefit of employers, not to empower workers with choices.

    And it’s not just the labour market. A worker’s implicit threat to quit becomes an empty threat if it’s hard for her to commute across town to the competition, or to move home closer to another workplace, because urban dysfunction and the country’s addiction to rising home prices have frozen up the housing market, making it expensive to move and time-consuming to travel further and further to work.

    Giving workers the power to bargain individually–or through a union if they freely choose to–is the next stage in development after enterprise bargaining. But if many of those choices were more illusory than real, then even a superbly designed IR regime might have simply shifted the constraints to other bottlenecks in the system, such as infrastructure and urban planning. Maybe that’s why productivity didn’t improve before the electorate rejected Workchoices in 2007. And yes, as Bernard says, maybe those other bottlenecks should now be given priority ahead of IR reform for a while.

  33. david

    FCount…WTF are you going on about????????????????? Go and have another drink… or pill…. or something

  34. Barry 09

    Did anybody watch Q&A and hear Hockey call the Live Animal trade to Hell , “”Live MEAT ” trade ? Money comes first for some.

  35. Johnfromplanetearth

    It all matters not, for as of July 1st ‘It’s the end of the world as we know it’ Bob Brown’s raving lunatics party hold all the aces and his dream of one world governance is insanity far and away more dangerous than any workchoices policy.

  36. Apathy

    David – With all due respect, having the protection you sighted on paper is one thing, actually using them in the workplace is another, especially for those not in a union. Australian cities really are small places. Burn a bridge in a city in Australia and guaranteed you will need to cross that bridge somewhere down the track. For most it is far easier to walk away than fight it out and get a reputation. In all my years of consulting, I have observed many people try and take on the system, including a couple of recent cases under the new framework and almost all of them said at the end that it wasn’t worth it. Especially those who were employed in Govt, where you would think that these protections would have the most authority. In the end, if an employer wants to get rid of someone, the smart ones can do it quite easy, it’s only the dumb ones that whinge that it’s all too hard and get caught out.

  37. Jimmy

    Free Country – that whole argument about the worker not being able to quit because they can’t find another job might hold some water if unemployment rates weren’t at record lows when workchoices was implemented.

  38. Peter Ormonde

    How clever of Peter Reith… to skewer Abbott in a way that the Government hasn’t been able to achieve…
    Over recent years Abbott has made significant inroads into “Struggle Street”… the self declared self employed “battlers” and other selfish whingers … but the hard IR stuff ripped into those gains.
    So Reith has given Abbott a serious wedgie. Well done. Never thought I’d be saying something nice about that fella.
    Now I know it’s probably a sub-editing glitch but for goodness sake, don’t call these things “reforms”…. trying to drag the country back to the 19th century is not a reform … class warfare, religious capitalism, worker bashing… but not a reform.

  39. Rob

    @PeterOrmonde >don’t call these things “reforms”…. trying to drag the country back to the 19th century is not a reform … class warfare, religious capitalism, worker bashing… but not a reform.

    This post needs a ‘Like’ button!

  40. Liz45

    @FREE COUNTRY – WorstChoices was introduced to drive down wages and ‘push up’ profits – and it succeeded. You seem to miss the point, that work shouldn’t be just the place you go to earn money – you should get enjoyment and fulfillment out of it. Howard, Reith, Abbott and the rest of them don’t give a s**t about these things. Howard believed that people should have to work whenever the employer wanted – and that employers should operate 24/7 regardless. Of course, this wouldn’t apply to politicians or CEO’s etc, who incidently increased their incomes by 150-300%?

    The system that you defend thinks it’s OK to pay women only 65% of what their male counterpart earns, or to use the ‘nurturing occupations’ like nursing and teaching that attract mostly women, to keep them lowly paid and take action to prevent them seeking pay justice.(NSW govt, recently). In her lifetime, a woman will receive ONE MILLION dollars less than a man. Wait until the submissions come before Fair Pay Australia re the new pay rates for Community Workers, most of whom are women. I anticipate, that apologists like you will push the line, that ‘in order for these workers to get increases, other services will have to go’ or words to that effect. I read your comments re aboriginal wages of decades ago, and was filled with disgust and repulsion. What about the millions in wages that aboriginal people didn’t even receive – over many years. Every State involved has shown outright racist protestations since that time.

    I’m against any Legislation where the aim is to increase the wealth of the capitalists at the expense of the workers. WorstChoices goal was just for this purpose, and so workers couldn’t unite and confront these injustices, the Legislation also included many sticks, the worst of which is the ABCC. It was no accident, that the Anti Terrorism Laws were introduced into the Parliament almost at the same time as WorstChoices – either Melbourne Cup Day or the day after. Fancy that? While the rest of the world was busy, and the media’s attention on four legged animals instead of two?

    If you and I spoke for 100 years, you would still either not understand or refuse to understand the contrary viewpoints expressed here. I support the improved pay and conditions for workers, and I’m repulsed by introducing Laws that reduce human beings to commodities (funny that was part of the Legal Argument for WorstChoices?) with the corporate wealth becomming even more wealthy at our expense. The safety of workers was not just a minor consideration, Howard took steps that made the education of workers on the job against the Law. It’s no accident, that the increased incidence of injuries and death was the outcome. What sort of a decent Govt uses their power to introduce draconian work practices like these, while spruiking about upholding “family values and traditions” and making out that we’re the upholders of human rights and decency? Bullshit?

    I think before you take the high moral ground; act like an advocate for the ‘big end of town’ you should divulge your own employment details, including income? I bet it’s heaps higher than what mine was, and probably more than many here who you choose to insult and demean by your ‘superior’ knowledge and argument. You’re just another bully, like a couple of my bosses, or Howard or Abbott? God knows there’s plenty of you out there?

    I’m waiting for the real battlers to be given the power and money to run ads on TV and in other media outlets, or are asked to lobby their politicians prior to IR Laws being forced upon them? I won’t hold my breath?

  41. Harvey Tarvydas

    Dr Harvey M Tarvydas

    A terrific article BK, well done, analytically competent and a valuable read with (I hope you appreciate them) the majority of commenters adding real value and learning from my read of the whole thing.
    So I should say a great Crikey bunch of talent delivering unique value.

  42. Harvey Tarvydas

    Dr Harvey M Tarvydas

    @LIZ45 — Posted Thursday, 30 June 2011 at 1:06 pm

    Your ……
    “I’m waiting for the real battlers to be given the power and money to run ads on TV and in other media outlets, or are asked to lobby their politicians prior to IR Laws being forced upon them? I won’t hold my breath?”
    ……………
    I can appreciate but today’s internet media could be used (with a bit of organisation) both to amplify attractiveness of Union Membership and to bypass the power of media.
    The right leaders, talent and motivation should not find it difficult?
    Union techniques changed or added to enabling recruitment and organising of young membership alongside traditional unionism caring for older workers unconnectedness should be relatively easy today.

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