PART 1: THE JOURNEY OF WORKPLACE REFORM 19.
Throughout most of the 20th Century Australia’s industrial relations system had been largely aligned to the needs of a nation undergoing significant social, political and economic development.
20.
This chapter examines how the failure of Australia’s industrial relations system to meet the needs of present day workplaces is a relatively recent state of affairs - one that does a gross disservice to the important role the industrial relations system played in the early development of Australia’s economy, and unwinds the 20 years of bipartisan reform efforts that commenced in the 1980s.
21.
For the industrial relations system to facilitate cooperative and productive workplaces in the 21st Century, Australia must regain its mettle for industrial relations reform and seek to restructure the system so it once again aligns with the needs of the present-day economy and labour market.
1.1 Australian industrial relations: 1904-1990s 22.
For eight decades after Federation, the fundamentals of Australia’s industrial relation system remained virtually unchanged. The passage of the Conciliation and Arbitration Act in 1904 heralded 84 years of centralised determinations and outcomes relating to industrial relations in Australia.
23.
In the first half of the 20th Century this system served Australia particularly well. In addition to making determinations and setting standards which would become “Industrial Awards”, the Commonwealth Court of Conciliation and Arbitration played a critical role in minimising the impacts of strikes during the emergence of Australia as a self-sufficient young nation with the ambition and resources to become a global trading force.
24.
This approach promoted cooperation between capital and labour early in the century where a highly combative environment meant there was minimal capacity for employers and trade unions to agree on employment conditions without third party involvement. The system also promoted stability and adaptability during key milestones including the introduction of a minimum wage, paid annual and sick leave, the 44 hour standard working week and the move towards equality for women’s wages.
25.
By the 1950s the award system had grown to cover even more occupations as the labour market began opening up to new industries driven by Australia’s economy maturing. Greater demands were being made on the award system which grew to encompass provisions for overtime and penalty rates along with other employment conditions.
26.
In 1956, a landmark High Court constitutional ruling saw the Commonwealth Court of Conciliation and Arbitration separated into two ‘fit for purpose’ bodies – an administrative tribunal called the Conciliation and Arbitration Commission (the first iteration of what is now the Fair Work Commission) and the Industrial Relations Court (which in 1977 transferred its powers to the Federal Court of Australia).
27.
Australia’s industrial relations system was no longer a mechanism for setting minimum conditions and regulating employment outcomes – it had become much more complex to serve Australia’s ongoing development.
28.
The first real indication that this centralised system may not be suited to Australia’s long-term future emerged in the 1960s. A militant trade union movement began organising large widespread strikes in pursuit of terms and conditions well above the awards determined by the Conciliation and Arbitration Commission and its predecessor body.
29.
By the 1970s this unrest had reached crisis point. In the first three months of 1974 Australia had reached a historic peak in industrial action, with a record 2.5 million working days lost to either strikes or lockouts. Not only was Australia subject to economic disruption as a result of industrial disputes, the above award payments had significant inflationary effects on wages which became a major social and economic problem as the decade wore on.
30.
It had become evident that while the historic award system was appropriate for regulating labour relations earlier in Australia’s economic development, parties were now making more and more AMMA Submission to A-G Discussion Paper “Cooperative Workplaces”
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