Here’s a lesson in getting what you wish for.
As part of the process of re-establishing the Australian Building and Construction Commission, the government is requiring that businesses remove “union-friendly” clauses from enterprise agreements if they are going to be eligible to tender for Commonwealth projects.
There was some kerfuffle over the time period in which the new code would be introduced, with Derryn Hinch changing his mind in February to support a shorter transition period. But the problem wasn’t the time period so much as that, perversely, the new code gave the CFMEU the whip hand in dealing with companies that had to re-negotiate deals in order to be compliant by later this year. The union was always going to extract a price from companies. In fact, to not do so would have been negligent — why would any union, except the jokers at the SDA, agree to contracts that left their workers worse off because they’d been stripped of protections? The CFMEU then did exactly, literally, what a union is supposed to do — secure a better deal for its members.
Cue outrage from the government and the right-wing press, then, when one company, Probuild, negotiated a deal with the CFMEU that was deemed “generous”. The Australian’s hardline IR roundsman Ewin Hannan complained about how “the cost of commonwealth projects will jump by hundreds of millions of dollars”. Employment Minister Michaelia “Chuckles” Cash attacked the company. Today in the Financial Review, Tory maven Jennifer Hewett weighed in to complain about the Probuild deal and lament that it was all part of a creeping re-regulation of IR. Unlike Hannan, Hewett doesn’t have a grounding in IR, so she made some howlers. She complained “it’s more like back to a pre-1990s future,” evidently forgetting that the pre-1990s IR framework involved centralised wage-fixing, which no one, not even unions, want to return to. She also claimed the ABCC had “a much stronger authority to take action against corrupt and illegal tactics and threats”, not understanding that the ABCC has literally zero powers to deal with corruption.
What was so outrageous about the CFMEU deal? According to Hannan, it involved “penalty rates of 300% for working over Christmas and Easter, higher penalty rates for working rostered days off, new casual loadings of up to 80% after six weeks of work, and an increase in a proposed across-the-board pay rise from 3% to 5%.” A 5% pay rise! Fancy that. High penalty rates for working over Christmas and Easter! Where does this union madness end?
Here’s a novel idea: the entire workforce, not just the construction sector, could do with a 5% pay rise, rather than lousy 1.8% they’re making do with currently. It might make the electorate a little less likely to decide the entire economic system is loaded against them and that it’s time it was dramatically re-regulated, not just, as per Hewett, to the 1980s, but to the 1970s and beyond.
As for the argument that pay rises will increase the cost of government projects, it’s funny how selective some commentators are. There’s a government policy that doesn’t add hundreds of millions, but $2 billion a year to construction costs: anti-dumping. For some reason, however, Crikey is the only media outlet that ever calls this out. Perhaps because anti-dumping is something that everyone has a vested interest in — both sides of politics, and both employers and unions, are all happy to see cheaper business inputs slapped with punitive tariffs that inflate business input costs and get passed on to other business, consumers and governments.
A more honest version of this whole story might be “government stuffs up too-smart-by-half stunt, union does what it’s supposed to do.”