Remaking industrial Relations? Unions, the state and industrial relations regime change in Britain and Australia

Rae Cooper, The University of Sydney

Chris Howell Trade Unions and the State: The Construction of Industrial Relations Institutions in Britain, 18902000, Princeton, N.J., Princeton University Press, 2005 (256 pp). ISBN 9-78069113-040-8 (paperback) RRP $38.95.

For many observers, Margaret Thatcher’s industrial relations policy was the apotheosis of state anti-unionism. Chris Howell’s Trade Unions and the State: The Construction of Industrial Relations Institutions in Britain, 18902000 (2005) addresses the ‘puzzle’ of why the British labour movement, traditionally characterised by industrial relations writers and historians as well organised and robust, so quickly and comprehensively ‘succumbed’ to the efforts of Thatcher and her successors. To resolve this problem, Howell charts and analyses the historical role of the state in British industrial relations.

His argument, in brief, is this. The orthodox analysis of British industrial relations has emphasised the ‘absence’ of the state from this sphere and has thus characterised the relationships between key industrial relations actors—trade unions and employers—as being ‘voluntarist’, or unregulated, in nature. Howell suggests that the traditional approach is unhelpful in explaining either the success of Thatcherist anti-unionism or the development of British industrial relations more broadly over time. The key to understanding the emergence of new industrial relations regimes, including that ushered in by Thatcher, Howell argues, is to reject the ‘state-less’ theory of industrial relations. Jack-booted police in riot gear closing in on pickets in pit towns during the mid-1980 miners’ strikes presents a particularly palpable image of the state’s intervention in industrial relations. But the state does not simply ‘appear’ in times of crisis, disorder and violence; it is ‘ever-present’, even when it is less visible. Howell urges us to see the state’s hand in the entire life-cycle of IR regimes: when new institutions and sustaining ideologies are built and disseminated, as the institutions and architecture of regimes are embedded and mature, and when they are destabilised and, ultimately, replaced. In fact, Howell argues that state anti-unionism so successfully undid union power in the 1980s and 1990s not because of an uncharacteristic intervention, but because state agency unravelled the (state created) institutions and the processes upon which unions relied for their own strength, institutions and processes.

Howell’s book is an impressive read and it has been touted as one of the best contributions to British industrial relations scholarship in a generation (see Coates 2006; Hyman 2006; Kelly 2006). But as an Australian immersed in current debates about national industrial regulation, reading this book made me very conscious of just how different we are from the British. It brought to mind the fundamental differences not only in the national industrial relations systems but in each country’s approach to analysing its own institutions, processes, and industrial relations actors. If, as Howell argues, a major failing of British industrial relations scholars is that they don’t ‘see’ the state, then ours just might be the opposite. In Australia we are quite good at describing the role of the state in industrial relations. Our work may not be overly theoretical and it is probably fair to say we take an ‘empiricist’ and ‘simplistic’ approach to the machinations of the state ‘in’ industrial relations (see Treuren 2000; Dabscheck 2000). But the hand of the state in industrial relations in Australia is obvious to us. We see it in the forging of our institutional architecture, in the marking out of the boundaries of our bargaining system, and in shaping the relationship between (and sometimes within) the industrial relations parties (Howard 1977). Sometimes in fact it is hard to see ‘past’ the state Australian industrial relations.

Howell urges us to see the state’s hand in the entire life-cycle of IR regimes.

If ever this were so, it was during the years of the Howard Government (1996–2007). John Howard made it clear, even before he was elected Prime Minister, that industrial relations would be central to his government’s agenda, and that ‘decollectivising’ the regulation of work would be an essential component of this. Speaking to a gathering of Young Liberals immediately prior the 1996 election, Howard argued that ‘the goals of meaningful reforms, more jobs and higher wages, cannot be achieved unless the union monopoly over the bargaining processes in our industrial relations system is dismantled’ (Howard 1996, quoted in van Barneveld & Nassif 2003).

The passage of the Workplace Relations Act 1996 went some way to achieving these aims. This Act stripped back the content of awards, necessitating that unions protect workers’ entitlements by attempting to push award stipulations into enterprise agreements. It seriously curtailed the ability of the Australian Industrial Relations Commission (AIRC) to intervene in industrial disputes and introduced hefty fines for unions taking ‘unprotected’ action. The Act introduced individual Australian Workplace Agreements (AWAs) which excluded unions. A range of other changes made it more difficult for unions to access and to represent workers and much easier for employers to choose whether, and to what extent, they would negotiate and bargain with workers. However, the grander intentions of the government in industrial relations were to remain unrealised for almost a decade.

Although victorious in both the 1998 and 2001 national elections, control over the Parliament’s house of review remained illusive. Numerous bills with amusingly Orwellian titles were presented to the Senate. The Fair Dismissal Bill of 2002 sought to remove unfair dismissal protection for employees in small business, while the Protecting Small Business Employment Bill of 2004 attempted to remove the requirement for small businesses to make redundancy payments to employees. The Genuine Bargaining Bill of 2002 aimed to make it much harder for unions to establish and maintain collective agreements and more difficult for them to use traditional union bargaining tools without exposing members to fines and legal action. However these bills—any many others—were rejected by the Senate, frustrating the government’s industrial relations project.

Numerous bills with amusingly Orwellian titles were presented to the Senate.

Things changed in 2004 when the government won an increased majority in the House of Representatives as well as outright control in the Senate. Enter WorkChoices. This represented the most profound change in national labour law since arbitration was introduced in 1904 (see Ellem et al. 2005 for an overview). Among other things, this package further reduced the power of the AIRC, watered down the standards against which workplace agreements were to be judged before becoming operational, facilitated the making of individual contracts and removed unfair dismissal protection for companies with less than 100 employees (Australian Government 2005; Andrews 2005). The scale of the changes staggered most commentators, but most were in agreement that ‘choice at work’ (for employees at least) was not a central feature of the package.

WorkChoices was a profoundly anti-union policy. It restricted unions’ ability to take industrial action and to enforce collective bargaining, it made organising non-union worksites much more difficult and it gave employers the capacity to marginalise unions and to avoid unionisation.

WorkChoices allowed employers to introduce individual contracting arrangements at any time for current (and prospective) employees, an option not available to employers in any other OECD setting. Effectively the system was set up to allow individual contracting to override union bargaining. Add to this the prohibitions on bargaining over issues which might assist unions to maintain or improving collective bargaining (such as providing protections for workplace union representatives, or improving union rights of entry to workplaces) and it is clear that the reach of unions through collective bargaining was circumscribed. WorkChoices constrained union action significantly. The process for unions of taking legal industrial action is very difficult, costly and fraught with the danger of exposing both unions and their members to significant fines and tort damages. By contrast, employer access to protected lock-outs is almost unlimited (see Cooper et al, forthcoming).

Under WorkChoices there was no requirement for an employer to take any steps to negotiate at all with a union, whether 20 per cent or 60 per cent or 100 per cent of their employees had either joined the union or expressed their desire to enter into a union collective agreement with their employer. WorkChoices severely curtailed the capacity of unions to organise in non-union workplaces. The barriers to union recognition, collective bargaining and collective action were far more formidable in non-union worksites. Together with additional barriers to union right of entry, uncertainty over union coverage and fear about job security and victimisation they act as a powerful disincentive to non-members joining unions in non-union workplaces.

WorkChoices was to become the most significant issue for public debate in 2006.

WorkChoices was to become the most significant issue for public debate in 2006 and it dominated the headlines and the election campaign of the following year. Research undertaken into the impact of WorkChoices on employees, particularly ‘vulnerable’ workers, was damning (Evesson et al. 2007; van Wanrooy et al. 2007; Peetz 2007; Gahan 2007; Baird, Cooper & Oliver 2007, Elton et al. 2007). A well-resourced union campaign against the law was waged throughout this time. The Your Rights At Work campaign was an innovative one; centring on a big-budget media strategy and local union and community groups pushing the anti-WorkChoices message in targeted marginal seats. When Labor, under Kevin Rudd’s leadership, won the November 2007 election in a landslide, WorkChoices, and the unions’ Your Rights at Work campaign were credited as playing a critical role in the outcome by both the leaders of the Labor and Liberal parties as well as by ACTU and other union peak council leaders (see Gartrell 2007; Loughnane 2007a; Loughnane 2007b; Bachelard 2007).

If the Australian community has so decisively rejected the WorkChoices package and the unions can in large part be credited with the ALP’s election victory then presumably we can expect Labor to roll back the conservative parties’ industrial relations agenda?

Howell’s argument about the British experience may offer us some insights here. He argues that while British unions welcomed the election of New Labour in 1997 that those expecting respite from Thatcher’s decollectivism were mistaken. Rather than scrapping this regime and constructing something new, Howell argues that the Blair Government simply tinkered at the edges of the system and, instead, maintained Thatcher’s individualised ethos and institutions ‘with only a peripheral role for collective representation and collective bargaining’ (Howell 2005, p. 188). Could this be the fate of unions and collective agreement making in the national industrial relations system currently under construction? It seems to me that the answer to this question depends very much upon the choices made by key agents in industrial relations in the coming six months.

At the time of writing, the Workplace Relations Minister, Julia Gillard, was negotiating with business groups and unions about the content and scope of the laws and regulations to replace WorkChoices. During the 2007 election campaign Gillard repeatedly promised to ‘rip up WorkChoices’ and to replace it with a ‘fairer’ system. The policy alternative to WorkChoices she presented included the (phased) abolition of AWAs for employees earning less than $100,000 per annum, legislated minimum standards, the introduction of a new ‘no disadvantage test’ against which all new agreements would be judged, a reinstatement of unfair dismissal provisions and, among other things, a ‘good faith’ bargaining regime. Whether, and to what extent, the pronouncements of the ALP in the context of an election campaign will translate to real policy changes remains unclear.

The ALP, under Rudd, has had a distinctly Blairite flavour.

However, the performance to date of Prime Minister Rudd does not suggest that a radical recasting of industrial relations is in the immediate offing. And the ALP, under Rudd, has had a distinctly Blairite flavour. Over the past year, Rudd has been keen to distance himself, and his party, from rowdy union leaders and has been at pains to tell anyone who is listening that unions will have no ‘special place’ under his administration (Sheridan 2007; Norington & Taylor 2007). Gillard expressed similar sentiments upon the very recent release of ABS figures on declining union membership and density (Schneiders 2008).

Howell argues that the state will only ever fashion industrial relations regime change in order to resolve ‘crisis’ during periods of intense industrial conflict which provokes middle class anxiety. In Australia, the unions’ Your Rights at Work campaign focused on removing the Howard Government in order to bury WorkChoices. The 2007 election result suggests that this campaign went some way toward generating the ‘liberal panic’ which Howell sees as a prerequisite for change. However, industrial action in this country is at historical lows and union membership is following the same trajectory. It is difficult to argue, using Howell’s model, that these circumstances create the conditions for remaking a collectivist industrial relations regime.


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Dr Rae Cooper is Lecturer in Work and Organisational Studies at The University of Sydney. Rae teaches management and employment relations and researches employment relations and gender and work.