The nuclear option available to end Sydney’s train chaos
In the newsroom we refer to it as a “tip jar” – a tool allowing us to receive instant news tip-offs from our millions of readers. As a subscriber, you would probably recognise it as a small box within a story with a headline such as ‘Do you know more?’
This week we created tip jars asking you to tell us about your commute during Wednesday’s Sydney rail chaos. Hundreds of readers wrote to us, venting their white-hot rage at the train meltdown triggered by industrial action by the Electrical Trades Union and the Rail, Tram and Bus Union (RTBU). Our state topic editor, Kathryn Wicks, has worked at the Herald for decades and said she has never seen a response from readers quite like it.
Commuters faced sharply reduced services and packed trains.Credit: Steven Siewert
Wednesday’s Herald editorial blasted the RTBU for its long campaign of industrial bastardry and spoke up on behalf of commuters who have had a gutful of being the collateral damage in its dispute with the Minns government. We said the chaos is damaging to the state’s economy. We also pointed out that leaving passengers on crowded platforms or in packed carriages for hours in the middle of summer – or during serious storms such as the one that swept across Sydney on Wednesday night – is also highly dangerous.
The Labor government’s latest offer would give RTBU members a pay rise of 14 per cent over four years, and an extra 1 per cent from legislated super increases. The union wants a 32 per cent increase over four years and a 35-hour working week. Many readers have a lot of sympathy for nurses asking for pay rises but do not place train drivers in the same category of essential workers deserving of a big bump.
The dispute will now go before the Fair Work Commission next Wednesday, with industrial action suspended in the meantime. If the government loses the case, the industrial action will carry on. If the government wins, it may be halted permanently while the pay negotiations are resolved.
If the government loses the case, one avenue remains available to stop the ongoing industrial action – and it’s regarded as the nuclear option. Section 431 of the Fair Work Act gives the federal workplace minister the power to unilaterally terminate protected industrial action should it threaten the lives, safety or welfare of the public, or cause significant damage to the Australian economy “or an important part of it”.
The provision has never been used before. Senior figures at state and federal levels with whom I have spoken over recent days have sought to downplay the chances of federal intervention. My sense is they are worried about the precedent of a government intervening in such a way, and are not confident they could meet the threshold of “significant damage” to the Australian economy.
But can Sydney afford this to continue for months on end? And can the state budget really afford shelling out huge pay rises to train drivers to resolve the dispute?
As the Herald’s Matt Wade explained this week, the state budget simply can’t afford the hikes some unions are demanding. Because the state government is responsible for labour-intensive social services, such as health, education and transport, wages are by far its biggest expense, meaning public-sector wage settings have a huge influence on the state’s bottom line.
“This year the NSW government expects to spend more than $48 billion paying employees, plus it will outlay $6 billion on superannuation,” Wade explained. In November the Herald revealed the Minns government will spend $6.6 billion more, paying public servants over five years to June 2028, than would have been the case had the Coalition’s wages cap remained.
However, that $6.6 billion figure only covers multi-year pay deals reached with about two-thirds of the state’s 400,000 employees; some major pay agreements are unresolved, including the one with the rail unions.
“While Treasurer Daniel Mookhey has taken steps to curb the rate at which borrowing is rising, gross debt is still forecast to reach $200 billion by mid-2028,” Wade wrote. “That’s equivalent to 20.5 per cent of the state’s annual economic output – a higher share than any time in the past 30 years.
“Meanwhile, the state’s interest bill is mounting. The NSW government will fork out $5 billion servicing debt this financial year and that is set to reach about $9 billion in three years.”
You can see the problem the Minns government faces. That said, NSW Labor arguably didn’t help itself by going to the last state election pledging to abolish the Coalition-era wages cap. In promising to do away with the cap, Labor did not give any sense of the sort of annual increases it would be willing to accept. Unions argue they were duped into believing the government would offer large hikes.
The events of this week have left a few people in Labor wondering whether a better industrial relations policy might have been to keep the Coalition wages cap but lift the rate to improve wages. Such an approach might have been less effective in dealing with retention of public sector workers but certainly would have given unions a clearer expectation that they can’t ask for the world and hold the city to ransom until they get it.
One more thing: a note on a deeply disturbing development in Sydney overnight. The arson attack on the former Dover Heights home of Alex Ryvchin, the co-chief executive of the Executive Council of Australian Jewry, is alarming. Multiple cars were graffitied, two set on fire, and a home splashed with red paint during the attack.
Ryvchin is one of the most senior Jewish leaders in Australia and has been outspoken against antisemitism since the October 7 attack by Hamas. He moved out of the house three years ago. The apparent targeting of him is a serious escalation in a spate of antisemitic attacks across Sydney over recent months. It is outrageous and should be universally condemned.
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