The Importance of Collective Bargaining - Research Paper Example

? Legal Scenarios By 13, June Collective bargaining refers to negotiations that take place between an employer anda group of employees (Legal Information Institute, n.d). The increasing presence of the federal state in the 21st century Australia industrial laws has seen the power of collective bargaining heavily watered down through policies and legislation that favor of the corporations. The objective of this paper is to examine the importance of collectivism over individual employee agreements, trace how the state has eroded this right, its impacts, and critically examine whether this should form the basis of public interest litigation. Collective bargaining stems from the need to address the power imbalance that exists between the employer and the employee. This power imbalance arises at various stages of the employment relationship, commencing when they seek employment and extends even after their employment has been terminated (Hogbin, 2006, p.13). This theory was propagated by Karl Marx who argued that the bargaining table was tilted in favor of the employer, and who could, as a result, exploit their stronger bargaining position to the detriment of the employees; driving their wages to subsistence levels (Hogbin, 2006, p.1). This imbalance necessitates special regulations in the labor sector. In addition, it is a fundamental human right under the International Labor Organization (ILO). It is enshrined in two key ILO conventions; 87 and 98- 1948 Freedom of Association and Protection of the Right to Organize and Right to Organize and Collective Bargaining (1949) respectively, both of which have been ratified by Australia. Individual contracting, while it can be useful for those with strong bargaining power, it is not a solution to employees without bargaining power and can be used to undermine labor standards (Cooper, Ellem & Todd, 2012, p.7). According to Sewerynski (2003, p.223) collective bargaining has a horde of benefits to both the employer and the employee. It enhances the strength and stature of employee unions. They also harmonize employment conditions across the industry and seek to eliminate chances of labor disputes. To add, it has a way of increasing the weight of employee’s dispute. This is because if a complaint is made by an individual employee, the employer can easily ignore it with minimal repercussions. Prior to 1993, there were no legal provisions for collective bargaining in Australia. Nevertheless, the system was collective in nature, with informal collective bargaining taking place in the form of negotiation over award payments, and industrial actions (ACTU, 2006, p.5). Subsequent agreements were given legal effect through consent awards subject to the approval of the commission. In addition, for almost a century, arbitration tribunals had settled industrial disputes between employer and employees, through making and awards that applied to the whole industry that applied to all employees, whether or not they were members of a union (Cooper, Ellem & Todd, 2012, p.5). Subsequently, the Howard government was determined to eliminate this collectivism from the system, instead, advocating for individual contracts (ACTU, 2006, 4). Some of the changes introduced affected collectivisms on two fronts; there were those that were designed to alter collective bargaining, and those meant to impair the effectiveness of the trade unions. This was achieved through the enactment of the Workplace Relations Act, 1996 and the Work Choices amendments of 2005(Cooper, Ellem & Todd, 2012, p.5). The former, was the first Employment relations legislation to make use of corporation power provided under section 51(XX) of the Australian Constitution rather than the conciliation and arbitration power under section 51(XXXV) (IRJ, n.d. 23). With regards to bargaining, the 1996 Act introduced statutory Australian Workplace Agreements (AWAs). AWAs could override both the awards and collective agreements. In fact, such agreements could form a pre-condition of employment (Cooper, Ellem & Todd, 2012, p.6). It enabled employees to negotiate directly with employees without involvement of the Unions. The employer could employ lockouts in order to pressure the employees to sign the agreements. ACTU (2006, p.5) argue that the offering of AWAs on a “take it or leave it” made a mockery on the very notion of choice. As a result, such a change gives the employer latitude to unilaterally determine the terms of employment and refuse to respect the choice of their workers to bargain collectively. Another impact of AWAs argued by Cooper, Ellem & Todd (2012, p.6) is that it generally affected union membership across the country, wages and conditions of employment. The employer could include a term that expressly excluded the employee from collective bargaining. In addition, the law recognized non-union collective agreements, which became popular after 1996(Cooper and Briggs, 2009, p.10). Work Choices introduced more varieties of agreements, such as the controversial ‘employer Greenfield agreement that in essence allowed the employer to enter into an agreement with him/her (Cooper and Briggs, 2009, p.10). With regards to restrictions on the operations of Trade Unions, the laws limited collective agreements to take place only at the enterprise level. Secondly, a ban was imposed on pattern bargaining whereby unions sought more than one outcome in more than agreement. Thirdly, the government limited even the terms that could be contained in a collective bargaining agreement, limiting key requirements for the operations of a trade union, such as the right of entry and enforcement, thereby curtailing the powers of the unions to monitor and organize their affairs Cooper, Ellem & Todd (2012, p.6). These restrictions significantly impaired the freedom of association. The issue of collective bargaining and labor laws generally formed a core pillar of the elections that saw the labor government come into power. In a bid to sanitize this area, the government enacted the Fair Works Act in 2009. The Act re-introduced collective bargaining, with an emphasis on enterprise based bargaining, and generally did away with AWAs introduced under the work choices. However, the new Act retains some of the Workplace Relations Act provisions, such as restricted right of entry, several limitations on the right to strike and stringent fines for unlawful industrial actions (IRJ,n.d, 23). Despite providing expressly for the right of collective bargaining, the Fair Works Act fails to inculcate key guarantees that ensure that employees enjoy this right. Instead, this gap is exploited by the employers to undermine collective bargaining. Consequently, it is clear that the state of the labor law in Australia has heavily been affected by politics, and has of late, in fact, been dependent on which party is in power. The state of collective bargaining in Australia negates both various fundamental freedoms enshrined under the constitution and international laws , and various international labor laws and standards and thus should be subjected to public interest litigation. It violates the freedom of association which is a fundamental right in modern democracies. This encompasses the right of the worker and the employers to form or join organizations of their own choice (ILO, n.d). The right to organize is a fundamental element of collective bargaining. Though the constitution of Australia is silent on freedom of association, this right is rooted in major international instruments such as Universal Declaration of Human Rights (Article 20,) ILO constitution (preamble) and Declaration of Philadelphia. This right is also recognized by Freedom of Association and Protection of the Right to Organize Convention which basically inculcates provisions that ensure development of a healthy trade unionism in a country. According to ACTU (2006A, p.5) freedom of association which includes the right to strike and right to bargain collectively sit alongside abolition of the worst forms of child labor, elimination of forced labor and elimination of discrimination as the four core labor standards that the ILO has declared to be non-negotiable. Therefore, any law that purports, either directly or indirectly, to prevent employees from fully enjoying this right is contrary to key international Instruments, of which Australia is a signatory. Australian laws fail to protect worker’s freedom of association through the failure to protect their right to organize. Therefore, the state participates through positive acts and through omissions, that is, failure to discharge its duties under international labor laws. Consequently, public litigation is essential for the court to interpret and protect workers’ right to collective bargaining and protect unions from both direct and indirect interference by both the government and the employer. Secondly, it also negates the employee’s freedom of choice. Every person has a right to work, and to free choice of employment (UDHR, article 23). Consistent watering down of collective bargaining negates the choice of employees to bargain collectively, leaving them under the control of the employer. In addition, Shaw and Ciolek (2006) argue that the nature of corporation power evidenced today exceeds what the framers of the constitution envisioned. They argue that the constitution does not empower the state to override industrial laws in favor of corporations. Therefore, they argue that the changes in industrial law constitute a misuse and undue extension of that power (Constitutional question, 2005). On the other hand, it can be argued that the states actions are well within the federal constitution, and that the state has not acted ultra vires the power given by the constitution. Indeed, the chief justice in Huddart Parker & Co v Moorehead (1909) 8 CLR 330 held that corporation power clause permitted the state to make such laws. The States and Trade Unions challenged the constitutionality of Work Choices legislation in 2006. In its decision, the high court found that the commonwealth had the power under section 51(xx), to regulate all employment relations (McCallum, 2006, p.137). In conclusion, nothing can empower a state to trample on fundamental human rights, whether domestic or provided by the international instruments. Though the constitution takes precedence over any other source or law, Section 51(xx) on corporation power ought to be interpreted restrictively to exclude instances where the use of such power leads to abuse of basic human rights. Collective bargaining is fundamental to the enjoyment of other key rights, both under domestic and international laws. Consequently, it is necessary to commence a public interest litigation to seek to seek interpretation of this grey area. References Books and Articles Australian Council of Trade Unions. (2006). A Fair Go at Work - Collective Bargaining for Australian Workers. Available at http://www.actu.org.au/Publications/Other/AFairGoAtWorkCollectiveBargainingforAustralianWorkers.aspx [Accessed 8 June 2013] Australian Council of Trade Unions. (2006A). A Fair Go at Work - Collective Bargaining for Australian Workers. [Pdf] Available at http://www.actu.org.au/Images/Dynamic/attachments/5352/ACTU-coll-bargain-report.pdf [Accessed 6 June 2013] Briggs,C., Cooper,R., and Ellem,B. (n.d).What about collective bargaining?[online] Available at http://evatt.org.au/books/what-about-collective-bargaining.html Constitutional Question. (2005). [online] Available at http://evatt.org.au/news/constitutional-question.html [Accessed 9 June 2013] Cooper,R., Ellem,B. and Todd,P.(2012). Workers’ Rights and Labor Legislation: Reviving Collective Bargaining in Australia. [pdf] Available at: http://ilera2012.wharton.upenn.edu/RefereedPapers/EllemBradon%20RaeCooper%20PatriciaTodd.pdf [Accessed 8 June 2013] Hogbin, G. (2006).Power In an Employment Relationship: Is there an Imbalance?. New Zealand Business Round Table. International Labor Organization. (N.d). Freedom of association and the effective recognition of the right to collective bargaining. [online] Available at: http://www.ilo.org/declaration/principles/freedomofassociation/lang--en/index.htm [Accessed 8 June 2013] International Labor Organization. (n.d.). Freedom of Association. [online] Available at: http://www.ilo.org/global/standards/subjects-covered-by-international-labour-standards/freedom-of-association/lang--en/index.htm [Accessed 7 June 2013] IRJ. ( n.d) .[pdf] Available at http://www98.griffith.edu.au/dspace/bitstream/handle/10072/31465/59326_1.pdf?sequence=1 Legal Information Institute. ( n.d) .Cornell University law school.[online] Available at: http://www.law.cornell.edu/wex/collective_bargaining [Accessed 10 June 2013] McCallum, R. (2006), ‘Justice at work: industrial citizenship and the corporatization of Australian labor law’, Journal of Industrial Relations, 48, 2, 131–153. Sewerynski,M. (2003). Collective Agreements and Individual Contracts of Employments. Kluwer Law International. Cases Huddart Parker & Co v Moorehead (1909) 8 CLR 330 Statutes and Conventions Fair Works Act(2009) Section 51(xx) Federal Constitution Freedom of Association and Protection of the Right to Organize Convention ILO constitution Work Choices legislation(2006) Universal Declaration of Human Rights Read More