Evolution of Industrial Relations in Australia

Drawing on the current developments in Australian Industrial Relations in the building industry you are required to prepare a research report on Australian Industrial Relations.

Industrial relation between employees and employers play a significant role in economic development of nations. The aim of the paper is to study the various aspects of industrial relation system in Australia and how it has evolved over time. Then the researcher would view the industrial relationship and its members, the employers and the employees from the view point of stakeholder concept. Then the role of various members of industrial relation like the government, the employers, the labour union, the employers’ association and the community in general would be assessed.

Conciliation and Arbitration:

It is evident that, the methods of dispute resolution involving arbitration and conciliation have a long history in Australia. In this context, it is worth mentioning that, the Constitution from the beginning envisaged the provisions of industrial arbitration and conciliation in Australia (Bourg and Erkman 2017). In this regard, mention can be made about the existing constitutional bodies, for instance, the Australian Industrial Relations Commissions, in which it was important to amend the functions that have been envisaged for its formulation (Charlesworth and Macdonald 2015). In Australia, the first Australian Conciliation and Arbitration Commission was established in 1973 (Wright and Lansbury 2014). With the formulation of the Australian Conciliation and Arbitration Commission, the functions of the Commonwealth Conciliation & Arbitration Commission have been replaced and the newly formed Commission is performing its functions effectively (Luke 2018). However, during the end of 1988, a legislative reform was formed by the federal government by repealing the Conciliation and Arbitration Act 1904 and thereby in such process; it was replaced by the Industrial Relations Act 1988 (Mowbray, P.K., Wilkinson and Tse 2015). Therefore, with the advent of the establishment of newly formed Australian Industrial Relations Commission has replaced the Australian Conciliation and Arbitration Commission.

General Background – Workers’ Rights and Entitlements, Equal Rights, Discrimination:

Under the provisions of both the Victorian and the Federal Equal Employment Opportunity and the Anti-discrimination legislation, there is a right entrusted to the workers in a workplace which will be free from all kinds of discrimination (Weller and O’Neill 2014). Workplace discrimination takes place when an adverse action is taken against an employee on the part of an employer (Kaufman 2015). The protected attributes can be emphasized as race, color, sex, religion, social origin and disability. In this context, the Australian Human Rights Commission of 1986 replaced the age-old Human Rights Commission established in 1981. In this regard, three new commissions have been newly implemented for instance- the Human Rights Commissioner, Sex Discrimination Commissioner and the Race Discrimination Commissioner which provided appropriate protection to the Worker’s Rights and Entitlements, Equal Rights and Discrimination (McDonald and Thompson 2016).

Role of Stakeholders in Industrial Relations

Awards, Enterprise bargaining Agreements (EBA) and Unfair Dismissal:

From the very beginning, the National Employment Standards (NES), has implemented a number of employment standards. It is noteworthy to mention here that, under to employer-employee relationship, most of the employees do not fall under the purview of an award. Mention can be made about the concept of unfair dismissal according to the provisions of Section 385 of the Fair Work Act. However, the concept of unfair dismissal is concerned with a person who has been unfairly dismissed in a workplace. Whether a person is unfairly dismissed or not depends upon the part of the Fair Work Commission on being satisfied that whether such person has been actually dismissed, the nature of the dismissal was such as it involved harshness and was unjustified (Donaghey et al. 2014). The Fair Work Commission on being satisfied that such dismissal did not comply with the provisions of the Small Business Fair Dismissal Code and without the involvement of a case of genuine redundancy (Edwards et al. 2015). After receiving the prescribed application and on being satisfied after reviewing the applications, the Fair Work Commission shall provide protection accordingly.

The Enterprise bargaining process is concerned with the negotiation that takes place between the employers and employees in connection to their intention of establishing an enterprise agreement (Legg et al. 2015). However, the nature of the enterprise agreement may be such where there is an involvement of one or more national system employers and employees according to the specifications prescribed in the agreement. It is worthwhile to refer here that, in most of the cases these enterprise agreements are negotiated by the parties by involving the process of collective bargaining and in good faith. According to the provisions of Fair Work Act 2009, an enterprise can be denoted as a business activity or undertaking.

Fair Work Act 2009 (law), Fair Work Ombudsman (enforcer), Disputes Heard in Fair Work Commission (tribunal):

It is evident that for the purpose of administering a number of laws and regulations governing the workplace culture in Australia, the Fair Work Act 2009 and the Fair Work Ombudsman are the main legislative bodies dealing with them. From the very beginning, these Acts have been governing the principles of employer-employee relationship in Australia by providing a number of safety measures and working standards for the purpose of maintaining fairness in work by preventing workplace discrimination to the large extent.

Provisions of Fair Work Act 2009 and Fair Work Ombudsman

Building and Construction Industry (Improving Productivity) Act 2016 (law), Australian Building and Construction Commission (ABBC) is Enforcer, Disputes Heard in Fair Work Commission (tribunal):

The activities of industrial actions are primarily regulated under the provisions of the Fair Work Act 2009. In this regard, it is worth noting that, the industrial actions in relation to the building work is subjected to various additional rules as depicted in the Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act). The Building and Construction Industry from time to time takes into consideration various industrial actions however; the industrial actions that are not protected are considered to be unlawful (Donaghey et al. 2014). It is noteworthy to mention here that, industrial actions can be protected if there involves negotiation of new agreements and that the expiration of the existing agreement has passed away. In case of action on the part of the employees, the Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act) shall protect industrial action if the concerned protection action order has already received authorization on the part of a secret ballot of the concerned employees. However, such approach is possible only if, there is an attempt on the part of the bargaining representatives to reach the actual agreement (Mowbray, P.K., Wilkinson and Tse 2015). The Building and Construction Industry (Improving Productivity) Act 2016 (BCIIP Act) shall be able to provide appropriate solution only if the prescribed notices and the orders of the Fair Work Commission have been complied with (Charlesworth and Macdonald 2015).

Federal system of Australia:

The Constitution of Australia has been developed on the structure of federal government. The structure of the federal government of Australia comprises of the Parliament, the executive and the Judiciary (Bourg and Erkman 2017). However, it is worth stating that, some of the features of the federal structure of the government are such that it has been referred as the parliamentary system of government (Wright and Lansbury 2014).  The concept of parliamentary government is concerned with the fact that the executive government enumerated within the Parliament however; responsible government denotes the fact that the executive government is responsible to the Parliament.

In this paper, a brief overview regarding the industrial dispute in Australia has been discussed. In an industrial relation, certain disputes can be cropped up and it is important to resolve those disputes in order to get a fair working relationship. The industrial relationship can be hampered if any disagreement regarding the rights can be occurred. Further, industrial dispute can be occurred in case of any conflict of interest between the employers. In Australia, there are certain problems regarding the workforce have been observed. Some of the common disputes are termination of employment, turmoil among the trade unions and adverse implementation of different legal provisions. The Australian government has taken certain steps to resolve the dispute relating to the industrial relation such as bipartite negotiation, mediation, and conciliation. However, in the period of 1980 to 1990, the economic condition of Australia was affected by the repeated industrial relations disputes and in the absence of any effective steps; the rate of such dispute was increased.

Enterprise Bargaining in Australia

Australian Industrial Relations Commissions has been established in the year 1956 to resolve the industrial disputes and the commission have empowered by the Workplace Relations Act 1996. This institution has played an important role during 1980 to 1990, when the problem regarding industrial matters was at hike. This institution was regarded as one of the most suitable institution for the labour dispute. This institution has promoted the process of negotiation. The existence of the Commonwealth Court of Conciliation Court has been ceased by an order of the High Court of Australia where the court has been observed that the conciliation courts can enjoy certain power of the court but the nature of court is tribunal and it should not exercise judicial power in any case. However, after that period, the following commission has been introduced and it provides awards on equal work and equal pay. Further, all the enterprise bargaining agreements were guided by this commission. The main objective of the commission was to maintain a fair working environment in the industrial relationship.

There are certain terms that have been used under the industrial disputes. The term enterprise bargaining is a process where certain discussion has been made between the employers and employees in respect of the wage and working condition. The term bargaining denotes negotiation. In this process, negotiation regarding the waging and working condition has been done and once the same has been decided, the order become mandatorily applicable on the parties. However, there are two agreements in the process such as collective agreement and collaborative agreement. Fair Work Act 2009 has done the negotiation process. 

It has been observed that during the time of the industrial dispute, certain legal provision have been reformed and certain workplace agreements have been made in between the industrial parties. The term workplace agreement exists when certain negotiation process developed in between the employers and the employees. The provision of the workplace agreements are based on the provisions of the Workplace Relations Act 1996. The main purpose of the agreement is to maintain certain flexibilities among the employers and the employees and give certain options to them so that they can modify their own arrangements regarding the workplace preferences.

However, certain key changes have been made regarding the industrial dispute resolution. It has been reported by the Australian Bureau of Statistics, changes have been made in the year 2005 when the coalition government has introduced Workplace Relations Amendment (Work Choice) Bill. According to this bill, certain flexibilities have been observed regarding the relation in between the employers and employees and productivity of the workplace has been introduced. Certain freedoms have been given to the employees so that they can choose their own employment conditions.

Legislative Reforms during Industrial Disputes

Many organisations are dealing with various industrial relation matters of Australia. Dispute has been cropped up in the building and construction industry of Australia. There are certain allegations pending before the court regarding the misconducts happened in the construction industry. Certain steps have taken by the Australian Government regarding the same. Cole Royale Commission was established to deal with these matters and the commission had failed to take effective steps regarding the same. For the first time, the Royale Commission was commenced in 2001 and it articulates those cases that were characterised by lawlessness relating to an industrial disputes. A National Building Industry Code of Practice has been implemented with the purpose of resolving the construction disputes and the commission is maintaining certain rules of the Workplace Relations Act and Trade Practices Act 1974.

In Australia, certain other establishments are governed issues regarding the construction and building related disputes. Office of the Australian Building and Construction Commissioner is one of it. It is a statutory authority and is dealing with the disputes and this body is responsible for the monitoring and promoting the workplace relations. The ABCC provided education, investigated workplace complaints and enforced compliance with national workplace laws in the industry. it was established in 2001 and succeeded Building Industry Taskforce. In this context, the Australian Human Rights Commission of 1986 replaced the age-old Human Rights Commission established in 1981. In this regard, three new commissions have been newly implemented for instance- the Human Rights Commissioner, Sex Discrimination Commissioner and the Race Discrimination Commissioner that provided appropriate protection to the Worker’s Rights and Entitlements, Equal Rights and Discrimination. . The Fair Work Ombudsman has been involved in seeking penalties in case of breach of workplace rules and regulations (Regan and Lee 2015). The Fair Work Ombudsman has worked in collaboration with the Fair Work Commission for ensuring integrated services.

There are certain allegations have been filed regarding financial irregularities and to resolve such disputes, Royal Commission into trade union governance and corruption has been established. It inquired into the activities relating to slush funds and other similar funds and entities established by, or related to, the affairs of these organisations. The Fair Work Commission has made certain inquiries regarding the financial disputes and certain incidents regarding the misappropriation of funds have been come into light. The former Governor-General, Dame Quentin Bryce, established the Royal Commission into Trade Union Governance and Corruption on 13 March 2014. The Royal Commission Act 1902 has governed the main works of the commission. It has the power to issue summon against the person against whom an allegation regarding financial dispute has been lodged. After the parties of a dispute come before the commission, it will promote a hearing and submit an interim report.

Building and Construction Industry (Improving productivity) Act 2016 has been implemented for the development of construction and building related dispute. The main objective of the Act can be categorised as follows:

(a)  Improving the bargaining framework so as to further encourage genuine bargaining at the workplace level;

(b)  Promoting respect for the rule of law;

(c)  Ensuring respect for the rights of building industry participants;

(d)  Ensuring that building industry participants are accountable for their unlawful conduct;

(e)  Providing effective means for investigating and enforcing this Act, designated building laws (to the extent that those laws relate to building work) and the Building Code;

(f)  Improving work health and safety in building work;

(g)  Encouraging the pursuit of high levels of employment in the building industry, including by encouraging youth employment with an emphasis on engaging apprentices;

(h)  Providing assistance and advice to building industry participants in connection with their rights and obligations under this Act designated building laws and the Building Code.

The provision of the Act will apply on the Australian Building and Construction Commissioner, and those who are part of the Australian Building and Construction Commission, exercise powers and perform functions in relation to building work. For example, the ABC Commissioner and other inspectors investigate, monitor and promote compliance with this Act, the Building Code and designated building laws. 

Fair Work Act 2009:

The legislation which is concerned with the governance of the workplace standards in Australia is referred to as the Fair Work Act 2009. It has been the foundation of all the regulations and standards maintained by the organizations of Australia. The rules and regulations depicted in the Fair Work Act 2009 have complied with the regulations of the workplace relations system from the very beginning (Rogowski 2016). However, the purpose of the system is to ensure that the productive workplace relations are balanced by keeping in view the relations of productive workplace with the promotion of national economic prosperity and social inclusion for the people of Australia (Webster 2015). In spite of all these, the Fair Work Act 2009, has been providing the terms and conditions required in case of employment. The Fair Work Act 2009 has been formulating rights and responsibilities of the employees, employers as well as the organizations in relation to the concerned environment.

Fair Work Ombudsman:

The functioning of the Fair Work Ombudsman is associated with the promotion of harmonious, productive and cooperative workplaces. The Fair Work Ombudsman has been providing active assistance to the employees, contractors and the communities to comply with the organizational laws of Australia (Farbenblum and Berg 2017). The Fair Work Ombudsman has been providing information and advice to the employees of an organization in Australia and at the same time has been involved in the investigation of workplace complaints by enforcing the laws of the organizations of the Commonwealth. The Fair Work Ombudsman has been involved in seeking penalties in case of breach of workplace rules and regulations (Regan and Lee 2015). The Fair Work Ombudsman has worked in collaboration with the Fair Work Commission for the purpose of ensuring integrated services.

Building and Construction Industry (Improving Productivity) Act 2016:

With the introduction of the Building and Construction Industry (Improving Productivity) Act 2016 (Building Act) on December 1, 2016, it has introduced favorable changes in case of workplace relations in the building industry (Kavanagh and McRae 2017). With the advent of the Bill, it was prepared with an intention to return the law concerning workplace relations in case of building industry. Therefore, it is worthwhile to refer here that, for the purpose of securing cross-bench support for the Bill in the Senate, the significant provisions of the Fair Work (Building Industry) Act 2012 (FWBI Act) has been retained by the government and in such process additional provisions were introduced (Farbenblum and Berg 2017).  In such process, it is worth examining the fact that, the government has succeeded in its attempt of making favorable changes in the provisions of the Fair Work (Building Industry) Act 2012 (FWBI Act).

ABCC:

The Building and Construction Industry (Improving Productivity) Act 2016 (Building Act) re-established the ABCC and in such process entrusted it with the powers for the purpose of obtaining information with the examination of witnesses and by producing relevant documents that has been in consideration under the Building Act.

The key stakeholders of the industrial relationship consists of government of Australia, the state governments of different states, the trade unions, the employee associations, the employers’ unions, the corporate organisations in Australia, the workers and the Australian community as a whole. The following section would explore the role of the different stakeholder groups as far as industrial relations in Australia is concerned (abc.net.au 2018).

The Office of the Australian Building and Construction Commissioner is an independent statutory body which oversees the working of industrial relationship in Australia. The body provides education on workplace policies, carry out investigations into industrial disputes and can even initiate legal proceedings, if the cases demands (abcc.gov.au 2018).

The Federal and the state governments of Australia is one of the key stakeholders in the industrial relationship of Australia. The government is plays several roles in the Australian economy which attribute it this important position. Firstly, the government is the policy and law maker which all industries operating with the market of Australia follow. The government in Australia forms laws to facilitate the operations of both the employers and the employees, the other two stakeholders of the industrial relations. For example, the Federal Government of Australia enacted the Fair Work Act in 2009 to regulate the workplace relations, guarantee employee safety, assist employees balance between personal and professional lives and to ensure that the employees receive minimum wages for their work (fairwork.gov.au 2018). The state governments of the Australian states like Victoria enforce the laws within the respective states to ensure that they are followed by the employers (vic.awu.net.au 2018). Similarly, the Australian Human Rights Commission enforce equality in the workplace by enforcing laws like Equal Opportunity Act 2010 (humanrightscommission.vic.gov.au 2018).

The government of Australia, both at the central and the state levels employ a large number of people. Thus, the government plays an important role in the industrial relations of Australia not only as a law maker but also as an employer.

The third role which the government plays in the industrial is that of provider of judiciary recourse in case of dispute between the employers and the employees or other members of industrial relations. The government of Australia lays the base of the Australian judiciary system which is helmed by the High Court of Australia (hcourt.gov.au 2018). This analysis shows that the government acts as a key stakeholder as far as industrial relationship in Australia is concerned in three capacities, as an law maker, as an employer and as a provider of dispute resolution framework.

Trade unions play a significant role as far as industrial relations is concerned. The trade unions came to existence to grant justice to employees and provide them collective bargaining power against employers. The labour unions represent the workers before the employers or business organisations in different industries and negotiate on the compensations the former pays to the employees. As far as industrial relations in Australia is concerned, the trade unions play significant role in ensuring fair working conditions to workers. The Australian Council of Trade Unions or ACTU is the peak body representing the labour force in Australia. The trade union supports on pillars of 46 affiliated union and nine trade and laboyr council. It also draws strength by the virtue of being a member of International Trade Union Confederation (actu.org.au 2018). The unions work towards ensuring workplace health and safety in the workplaces in Australia. This shows that labour unions play significant role in the industrial relations of Australia.

Employee associations like labour unions represent workers and their demands. They too fight on behalf of the employees and demand for better working environment for the workers (commerce.wa.gov.au 2018).

The employers’ associations are bodies which bargain for the right of business organisations, retailers or any other organisation which engages labour in its operations. The employers’ associations just like the labour unions represent their members to demand more concessions and facilities from the governments (Tortia, Haly and Jensen 2015). As far as Australia is concerned, the employers’ associations perform various activities in the country’s industrial plane. They adopt methods like political lobbying, public relations and business research services to the business organisations. They also make provisions from training and education services to the member employers (Breda 2015). The employers’ union in Australia not only demand for better facilities from the government but also industrial structural changes like decentralisation. For example, Australian Institute of Building or AIB plays important role in decentralisation and education of employers (aib.org.au 2018). This analysis shows that employers’ associations plays important role in ensuring legitimate bargaining of the employers in the market of Australia.

The community plays important role in the industrial relation in Australia. The labour unions like using the media report injustice towards employees by the employers. This creates reactions in the community like boycotting of business organisations and the products. The business organisations in order to win back support from the community and revive their goodwill, have to negotiate with the employees (Benvegnú, Haidinger and Sacchetto 2018). Thus, community plays a very important role in the industrial relations in Australia because it forms the base of their goodwill. Thus, the employers are compelled to negotiate with the employees in the face of community actions to keep their goodwill in tact.

Current Environment:

The current environment of the industrial relation in Australia in under the impact of several stakeholders like the government departments, the business organisations, the employers’ associations and the labour unions. The industrial relation plain in Australia is extremely competitive owing to its immense profitability and strong corporate governance of the stakeholders. This often leads to clash of interests which leads to dispute. One such dispute took place in 2013 Victorian Branch of the Construction and General Division of the Construction Forestry, Mining and Energy Union (CFMEU) banned Boral Limited from supplying construction material to sites controlled by it. The ban took place because Boral also served Grocon Pty Limited with CFMEU was in dispute.  Boral filed a case with the Supreme Court of Victoria and the later declared the ban illegal. CFMEU contravened 45D and 45E of the Competition and Comsumer Act 2010 by imposing the ban. An officer even threatened to diminish Boral’s market if it kept on serving Grocon. This analysis shows that industrial relationship in Australia is very complex where employer s’ associations and business organisation attempt to blackmail their suppliers to gain underserved profits (Ag.gov.au. 2018).

The associations of employers and the employees enter into collective bargaining to ensure healthier workplace relationship. The employers today view their employees as stakeholders who attribute them their high business performance. The employers today emphasise on providing facilities like better working conditions and compensations to them (Korschun 2015). These changes to a great extent have helped in reducing confrontations of the associations formed by the two groups. If the management fails to resolve the problem, they report to a more senior body of officers. If unresolved, the case is referred to a independent conciliator or mediator like the Fair Work Commission which takes up to case to hear it.

Industrial dispute between employees and employers can be settled in Australia as per the guidelines provided by mechanisms like the Fair Work. First, a representatives of the employee under questions meets the direct reporting manager of the employee to discuss the dispute. They try to resolve the problem and if they fail to do so, they refer to case to the senior management (fairwork.gov.au 2018).

The community today acts as an important stakeholder and boosts settling of disputes. This role of the community as an agent of settling disputes was exemplified when three unions of engineers, baggage and catering staffs and long-haul pilots of Qantas went on strike over working conditions and compensation. The strike affected 80000 passengers as over 600 flights had to be cancelled. The strike effected the tourism industry of Australia and the entire Australian community due to the inconvenience they faced due to cancellation of flights. The Fair Work Australia ordered the airline company to resolve the dispute and resume its services. An analysis of this resolution would clearly show that resolutions of disputes have economic benefits (abc.net.au 2018). The disputing employees and employers after resolving the disputes can resume productivity. This again starts generating revenue for the business organisation and the economy as a whole.

Healthy industrial relations in Australia and adoption of fair Work Act in Australia has promoted economic development (Herrera 2015). For example, as per Australian Bureau of Statistics, the mining industry has grown by 38.2 percent while the manufacturing industry has fallen by 3.4 percent (abs.gov.au 2018).

The politics of Government of Australia and the states is also responsible for the industrial relationship in the country. They emphasise on settling of disputes between the employees and the employers to ensure more productivity. This leads to more stable economy and get more public support to win elections. Thus, today politics acts a catalyst for settling industrial disputes and ensuring more healthy industrial relations.

Current Liberal Government:

The current government of Australia is liberal and encourage more participation of employees and employers in settling disputes. The government makes laws to ensure reduction of exploitation of employees in the hands of the employers and more congenial working environment.

Royal Commission into Trade Union Governance and Corruption-ABCC:

The Royal Commissions appointed by the Government of Australia to inquire into disputes. They play important role in curbing corruption and ensure better trade union governance in Australia (guides.naa.gov.au 2018).

Future:

The industrial relation in Australia has bright future as Australia experiences economic development. However, the enterprise bargaining system in the country is still not flexible to comply with the dynamic market situations. The work councils in the organisations slowly gaining importance and boosting organisational productivity (theconversation.com 2018).

Conclusion:

The discussion clearly shows that industrial relationship plays a very important role in economic development of economies. As far as Australia is concerned, the industrial relation is extremely complex owing to involvement of large number of employees and employers. The government of Australia forms laws which provides guidance to these employers and employees to work in a congenial environment. This ensures productivity and revenue generation for the business organisations. It also ensures continuous generation of employment in the Australian economy and economic development. One can also point out from the discussion that disputes result in economic losses to business organisations due to interruption in the productivity. Industrial disputes in one industry like airlines also hampers other industries which are dependent on it like tourism. It also impacts the society due to suspension of production of goods and services. Thus, it can finally concluded that a peaceful and congenial industrial relationship is important to ensure economic development in Australia.

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