Causes and effects of industrial conflict in the Australian construction industry

Discuss about the Industrial Relations Conflict in Australia.

It is important for an organization to focus on building a proper relationship at the workplace for the achievement of the desired production level. The industrial relations conflict occurs when there is a disagreement between the employees and the management of the company. The disagreement leads to disruption of the production process which leads to a reduced profit margin in the market. Business management is required to identify the needs of the stakeholders of the company towards a reduction of the conflicts in the market. The dissatisfaction of employees causes an unstable relationship at the workplace which makes it hard to acquire a proper organizational structure. According to Wallensteen (2015), the remunerations and wages are the main causes of the industrial relation conflict in a company. The organization and the government are required to develop policies that will assist in reducing the industrial conflicts in the nation. The industrial conflicts negatively impact the performance of the company due to the reduced number of products in a certain industry (Comboh 2014). In Australia, there has been a continuous increase in the industrial disputes, especially in the construction industry. The workers in the industry intend to have an increase in wages and working conditions for a smooth flow of operations.

In Australia, the industrial conflicts have been continuously increasing making it hard to acquire the desired social and economic development. According to Australian Bureau of Statistics (2018), there were 67 industrial disputes in December 2017 quarter which is 10 more than the quarter of September 207. The employees involved in the industrial dispute in the fourth quarter of 2017 were 17,100 and in the third quarter were 8,100. The continuous increase in the number of people in the industrial dispute has lead to a reduced economic growth in the nation. The high number of industrial conflicts is causing a slow economic and social development in the nation. It is necessary for the management to focus on developing strategies that will enhance the relations with the employees (Van den Berg 2016). The Australia construction industry is supposed to consider rules that are employee focused on reducing the industrial conflicts experienced in the sector. 

The causes of industrial conflicts in the construction industry are mainly due to the long working hours, poor working conditions and low wages. There has been a 34% increase in an industrial dispute in the construction industry since the abolishment of the Australian Building and Construction Commission (ABCC) (Smart Company, 2018). The industrial actions in the construction sector contribute to two-thirds of industrial conflicts in the nation. The government intends to restore the ABCC to ensure that there is proper control of the construction industry for a sustainable flow of the economy. The Australian government is dependent on the construction sector for developing the needed structure for commercial and residential purposes. The focus on the industrial actions aims at ensuring that there are a reduced number of days lost due to the industrial action. Proper evaluation of employee needs assists the management to develop plans that are widely accepted in the sector (Wallace et al. 2016). The Fair Work Building Industry Inspectorate was founded after the abolishment of Australian Building and Construction Commission (ABCC) in 2012 (ABC News, 2016). The involvement of stakeholders in decision-making process assists in identifying problems and coming up with appropriate solutions.

Impact of industrial dispute on economic growth

The stakeholders in the construction industry should be involved in the policy-making by the government. The involvement of stakeholders assists in reducing the conflicts in the market towards a sustainable flow of business operations. The Australian Bureau of Statistics discovered that industrial disputes for every 1000 workers in the construction industry are five times higher than any other industry in the nation (ABC News, 2016). The government is required to focus on the decision that will provide a steady flow of operations in the sector for the achievement of the desired production objective. The stakeholders in the construction sector include the government, labour unions, employees, and clients. According to Natspec (2018), the professionals used in the design and building of properties should be considered in the decision-making process towards the achievement of the desired production level through reduced industrial conflicts. The cooperation in the industrial sector is vital for developing of quality structures in the nation.

Stakeholders’ interest and power are considered towards the development of appropriate rules and regulations that are widely accepted in the construction industry. A continuous increase in industrial conflicts in the Australian construction industry is an indication that the decisions implemented do not consider the stakeholders in the market. According to Lupo (2016), the planning, review and formulation process in the construction industry is required to identify the needs of the stakeholders. The trades unions are used to assists the employees have the power to express their grievances to the management. It is necessary for the trade union in Australia to focus on business ethics and legal aspect of industrial conflicts to reduce the number of days lost due to the strikes. The trade unions are used to provide a proper employee and employer relationship by assisting in dealing with issues facing the organization (Bray et al. 2014). The ability of an individual to offer quality services is facilitated through a suitable working environment. The construction industry workers are aimed at ensuring that there is the development of the working condition towards a sustainable flow of business operations. The stakeholders’ interests are considered in developing a proper strategy that will deal with the changes in the market (Heravi, Coffey & Trigunarsyah 2015). Business values implemented in a business is required to consider the needs of stakeholders for a prior flow of the industry. The design of the building is expected to provide a suitable working environment to reduce cases of harm to the workers.

Involvement of stakeholders in policymaking

The evaluation of stakeholders’ roles and needs assists in making sure that there is a proper project outcome towards a sustainable performance in the market (Eskerod, Huemann & Ringhofer 2015). The inspection and reporting of construction progress assist in dealing with the construction conflicts that are available in the industry. It is possible for the employees to provide the inspectors with the issues faced in the workplace. The construction inspector is required to act based on the issues in the industry for a sustainable flow of the construction industry. The decision making process is required to focus on the needs of stakeholders for a steady operation in the targeted market (Cascetta et al. 2015). The use of technological innovation in the construction industry will assist in reducing the cases of industrial conflicts. The stakeholders will be able to communicate using the assessable information system in the company effectively. Most industrial actions in Australia are due to the inability of employees to reach out to the management to express their problems in the workplace. Stakeholders are required to work together in developing a proper communication plan that will reduce conflicts during the production process. 

The evaluation of stakeholder’s values assists in identifying the point of intervention for different stakeholders in the market. The intervention point is supposed to offer a smooth flow of operations in the market towards a sustainable performance of the company.  According to Tantalo and Priem (2016), stakeholders’ interventions should provide suitable solutions to the industrial conflicts. In the construction industry, the trade union intervenes when ether is a disagreement between the employer and employees to assists in developing proper plans to solve the problem. The trade union is supposed to provide a lasting solution by considering the two parties involved in the conflict. The construction industry requires the employee and their representatives to focus on continuous development of the industry through reduced industrial conflicts. 

Government regulations are aimed at providing a proper infrastructure that will facilitate the flow of the industry. The legislative framework in the construction industry is used to deliver quality structures to the clients. It is important for the stakeholders in the construction industry to focus on quality production following the set regulations in the nation. According to Safe Work Australia (2018), 33 workers died, and 35 people are injured every day requiring focusing on the safety of employees. The Worker Health and Safety (WHS) Act is aimed at reducing cases of harm to the stakeholders in the market. The regulations provide the workers with a suitable environment due to reduced injuries and deaths in the construction site. The evaluation of stakeholders’ interests and power is used in developing a proper plan that will reduce the cases of injury at the workplace. The construction industry safety and health are necessary for ensuring that there is a proper flow of the sector towards the accomplishment of the desired production level. The properties developed in the nation should provide stable performance in the economy through to the proper design and quality of building (Yorio, Willmer & Moore 2015). The code of practice implemented in the construction sector is focused on the health, safety, and welfare of the employees considering the WHS Act in the sector. The approved code in the construction industry is expected to focus on the health and wellbeing of the workers to reduce the industrial conflicts in the industry.

Importance of worker health and safety regulations

The stakeholders are expected to comply with the set regulations in the industry towards a sustainable flow of operations in the market. The contractors and builders are required to implement decisions that are highly accepted in the industry. The Australian government is focused on developing regulations that will provide a proper infrastructure in the construction sector. According to Australian Construction Industry Forum (2018), the members are required to have proper information regarding the building and engineering construction in Australia. The forum aims at providing needed knowledge to the members regarding the design, cost building management and legislation to consider in the construction process. According to Australian Government (2018), the Fair Work Act 2009 is legislation that is used to manage the relations of employees and employer in the nation. The Act provides the minimum requirements that the employer and employee should consider towards a proper flow of operations in the industry. The fairness is necessary for motivating the employees to achieve the desired production level in the market.  The work systems implemented by the management should provide a suitable working environment for the employees. The management of relations using the legislation is used to deal with conflicts in the market.

The Sex Discrimination Act 1984 aims at ensuring that there are proper recruitment and compensation of employees regardless of the gender (Australian Human Rights Commission, 2018). The legislation is aimed at dealing with the gender inequity in the nation for a sustainable flow of the nation. It is important for a nation to treat male and female equally for the achievement of the desired production level in the nation. The macroeconomic goal of economic growth and full employment is achieved through elimination of discrimination in the workplace. The dealing with the gender pay gap is necessary for a nation to accomplish the desired production objectives.

 Kane constructions experienced an industrial action that negatively contributed to the performance of the company. The industrial action was lead by the Construction Forestry Mining and Energy Union (CFMEU) after the death of staff in the construction site. The industrial actions by the company lead to a reduced performance of the company due to the lost days of the conflict. According to Hannan (2017), CFMEU was later found to have negatively incited the staff to strike instead of focusing on the Fair Work Act that considers the health and safety of the employees. It is important for the stakeholders to have a proper understanding of the needs of the market towards the development of a proper strategy that will be widely accepted in the market for the achievement of set production goals. Kane Company is a leading construction company in Australia which experienced a reduced performance level from the strike organized by CFMEU. The company reported that it was targeted by CFMEU with the aim of negatively impacting the performance level where over 100 workers were involved in the strike (Toscano, 2016). The industrial action protecting the health and safety of employees required proper evaluation for proper flow in the market. An organization is required to have a proper health and safety policy that will provide a proper perception to the stakeholders.

Trade unions and their role in resolving industrial conflicts

The industrial strike was illegal as CFMEU was later fined for assisting the employees to take up the industrial action. According to Patty (2017), CFMEU was fined for facilitating an illegal strike for the Kane construction workers. It is important or the trade union to focus on industrial legal actions that will enhance the employee and employer relations (Bray et al. 2014). The industrial actions are used to push the management to implement the required strategy for a sustainable flow in the market. The illegal strike by Kane workers provided a poor reputation for the company. Kane Company stated that it had followed the Worker Health and Safety Act despite the injuries and death at the construction site. It is necessary for industrial action to consider the factors that lead to a particular accident to reduce the number of strikes in the construction industry. Construction companies in Australia have experienced threats from trade union, and the ABCC restatement aims at ensuring that there is a proper flow in the construction industry (Toscano, 2016). The strike by Kane Workers had a negative impact on the relationship with the clients, employees, and CFMEU. The company removed the CFMEU union flags in the construction sites which have to lead to a poor relationship between the union and the company (Marin-Guzman, 2018). The employees’ morale was reduced after the injuries and deaths in the site requiring the company to focus on the WHS Act for a proper flow of operations. The issues between the union, employees and Kane Company have reduced the profit margin of the company due to the poor reputation of the company due to the industrial action.

The industrial conflict was handled by the Fair Work Commission of Australia to provide a smooth flow of the company. Proper evaluation of the situation assisted in coming up with the issue of industrial action in the company for a steady flow of operations in the market. Patty (2017) stated that the Fair Work Commissioners took legal action due to the loss caused by the industrial action. The legal action was against CFMEU and ten officials which were presented to the Federal Court of Australia. The legal action was aimed at reducing the incitement by the labour unions which negatively impact the performance of the company. The Federal Court of Australia found out that CFMEU targeted eight construction sites of Kane Company which is an offence according to the Fair Work Act (Patty, 2017). The sabotage of operations of the company reduces the profitability and economic development in the nation. It is necessary that the management focuses on the development of problem resolution strategies that will reduce cases of industrial actions.

The conflicts resolution strategy implemented by an organization is supposed to contribute to the growth of operations. Industrial action concern should be solved in reducing the strikes in the company. A company with a reduced number of strikes makes it possible to acquire the desired production level in the market through the high employee morale. The motivation of employees is achieved through fair treatment of employees by considering their needs, health, and safety (Koivupalo et al. 2015). Resolution of the conflict at Kane constructions was acquired by assuring employees of full implementation of Fair Work Act towards a suitable working environment.

Conclusion

The industrial conflicts cause reduced performance of an organization due to the low motivation of employees. The industrial conflicts lead to industrial action which makes the business to lose revenue due to missing employee days at work. The economy of a nation is negatively impacted by the increase in industrial conflicts. In Australia, the construction industry has been experiencing a high number of industrial conflicts making it hard to accomplish the desired project target. It is necessary for the company to have an insight of the interests and needs of stakeholders towards a sustainable performance in the market. The analysis of the stakeholders’ needs assists in developing strategies that are widely accepted in the market. Kane Constructions is a company that experienced industrial actions that lead to reduced performance of the business. Worker Health and Safety (WHS), Sex Discrimination Act and Fair Work Act are legislations that are used to provide a smooth flow of businesses in the nation.

References

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