Industry-wide bargaining must be stopped in tracks
Australia’s mining companies are taking a stand for economic good sense in their decision to challenge the reach of the Albanese government’s industrial relations laws. Coal giants Whitehaven Coal, Peabody and Glencore are challenging a Fair Work Commission decision compelling the companies into multi-employer bargaining.
It will be a test case for how trade unions can use the new laws to reinsert themselves into industry decision-making and overturn decades of productivity-enhancing use of enterprise agreements. Collective bargaining is a throwback to an industrial relations era that beset the economy with widespread strike action. Companies that had good relations with their workforce were dragged into disputes that otherwise would be of no concern. Industry-wide bargaining is the worst fear of major companies and is something the Albanese government assured employers was not its intention when the Jobs and Skills Summit was held in the honeymoon glow of Labor’s return to office. Anthony Albanese and his employment and workplace relations minister at the time, Tony Burke, said the changes were aimed at small businesses that did not have the resources or expertise to negotiate individually.
Fast forward, and trade unions are using the new laws to argue for industry-wide bargaining across major industries. This includes mining where there is a new push by unions to regain control of the Pilbara projects that have been the lifeblood of the national economy. Tougher workplace laws for industry have come as commodity prices are starting to fall in the wake of weaker economic conditions in China and industry faces higher costs of energy as a result of global and domestic conditions.
Whitehaven Coal, Peabody and Glencore were the first miners hit with a FWC ruling applying the Albanese government’s multi-employer bargaining rules. In the wake of Labor’s 2022 amendments to the Fair Work Act, the FWC last month sided with union representations in declaring that competing businesses mining the same commodity in the same state had a “common interest” requiring them to enter multi-employer bargaining negotiations. The mining industry has warned the IR changes will bring conflict to every workplace.
The government claims industry is overstating the impact of the new laws. But the Minerals Council of Australia says the coalminers’ decision is the test case that will set the “precedent for how multi-employer bargaining laws will be applied”. A briefing note says the FWC has taken a “very wide view of the law” and endorses the unions’ argument that “the fact that each of the companies mine coal for export in NSW should be enough for them to be roped in together”. The logical extension of the ruling if it is upheld is that iron ore producers could be roped in together because they all mine the same resource in Western Australia. Banks could be forced to bargain collectively, as could big supermarkets and other sectors by industry.
The MCA is right to argue the Fair Work decision effectively turns back the clock four decades, returning the industrial relations system from enterprise-based terms and conditions that began in the 1980s to industry-wide wage fixing. Despite criticism from veterans on its own side of politics, the federal government remains unconcerned about the damage its new rules could wreak across the economy. The appeal is only part of a much bigger pushback being marshalled by industry against the government.
It is imperative the FWC reduce the scope of the new laws to avoid industry-wide bargaining. And for the government to give a clear signal that it understands the dangers of returning to the less flexible and less productive regime that existed before changes started in the Hawke and Keating years helped unleash decades of prosperity.