The return of the Industrial Relations Club


Australia’s industrial relations system is one of the most centralised in the Western world. It has been for most of the time since the establishment of the Commonwealth of Australia in 1901. Only on rare occasions in a century have governments, Labor or Coalition, seen fit to challenge the system.

Download In the early 1990s, following Labor’s victory in the March 1993 election, Paul Keating introduced enterprise bargaining to provide greater flexibility within the system. He
did so in the aftermath of a serious recession and high unemployment.

After the 1996 election, John Howard and Peter Reith embarked on further decentralisation of industrial relations, including the introduction of new individual statutory agreements.

Then, in the mid-2000s, following John Howard’s substantial win in the October 2004 election, the Coalition introduced the ill-fated Work Choices legislation. The focus was on easing unfair dismissals regulation, increasing the role of individual agreements and further limiting compulsory arbitration.

One of the political difficulties with the Work Choices reforms turned on the fact that they came about at a time when Australia’s economy was strong and unemployment relatively low. In short, Work Choices was not seen as resolving a current problem – a fact which made it difficult to sell to the electorate.

Contrary to the mythology, Work Choices did not dismantle the centralised system – which explains why the Fair Work legislation, which replaced it, was implemented so readily. Most of the legislative infrastructure that supported a centralised industrial tribunal making binding award decisions remained on the statute books. Moreover, the WorkChoices Act ran for hundreds of pages – and its numerous sections must have been regulating something. It had more to do with moving the focus of regulation – from the regulation of arbitration to the regulation of bargaining – than with deregulation.

Indeed, there is a strong argument that the Howard Government’s use of the corporations power of the Constitution to implement Work Choices buttressed the eventual resurgence of centralisation by extending the reach of the federal award system as the default for workplaces across the country.

Labor’s commitment to abandon Work Choices was central to Kevin Rudd’s landslide victory in November 2007. The task was undertaken by the Deputy Prime Minister Julia Gillard in her capacity as Minister for Employment and Workplace Relations.

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