Workplace relations must boost productivity, wages

The citywide strike in Sydney on Monday that left workers, students and the nation’s first international visitors in two years stranded without trains on a hot, humid day was a sharp reminder of the economic and social costs of industrial disputes. Compared with life decades ago – when, on average, more than three million working days a year were lost due to industrial disputes in the 1970s and almost two million days a year in the ’80s – the number of strikes was reduced markedly in recent years after the industrial relations reforms of the Hawke-Keating and Howard eras. Given the crucial impact of workplace relations on productivity, the subject needs to be debated thoroughly in the coming federal election campaign. The Sydney rail strike is an immediate challenge that the Perrottet government and the Rail, Tram and Bus Union need to resolve as soon as possible, bearing in mind that privatisation of state-owned industries has served our most populous state well. The strike also poses a challenge and an opportunity for both sides of federal politics to focus on workplace relations.

NSW Opposition Leader Chris Minns blamed the Perrottet government on Monday, accusing it of “pouring petrol on a combustible situation”. Scott Morrison linked the dispute to Labor politics, arguing that unions were ramping up: “This is what they think they can get away with when they think they’re going to win an election, imagine what they’d be like if they actually won it.” Anthony Albanese kept his head down. His industrial relations spokesman, Tony Burke, was unhelpful. He said the Prime Minister was angry with unions for two reasons: they pushed for secure jobs and pushed for better pay: “Wages have been flatlining for eight years, it’s a deliberate strategy for this government as Labor’s the only party going to the next election with a plan for secure jobs,” Mr Burke said.

Labor’s challenge, if it won office, would be managing the high expectations that the Opposition Leader, opposition Treasury spokesman Jim Chalmers, Mr Burke and the ACTU have cultivated in their supporters’ minds about an ALP government delivering hefty wage rises and more secure jobs, although the strength of the labour market is what makes jobs, casual or otherwise, secure. Mr Albanese told the National Press Club last month he wanted “rising living standards, lifted by more secure work, better wages … an Australia with more secure jobs in both existing and new industries”. He advocated productivity improvements. While emphasising cheaper childcare and workplace training, he has not backed the kinds of reforms to the rigid, centralised Fair Work system that would boost productivity – especially more flexible work practices negotiated on an enterprise-by-enterprise basis. Nor has the Morrison government been able to legislate even modest workplace reforms to free the labour market from the constraints of the Rudd era. But the risk for Labor is that productivity improvements in areas such as childcare and training will be swamped by ill-discipline from trade unions.

Last month, key unions such as the United Workers Union, the Electrical Trades Union, the Australian Workers Union and the Transport Workers Union vowed to pursue “significant” annual pay rises of at least 3 per cent this year, ­declaring frustrated workers were “itching” to strike in support of wage claims. ACTU secretary Sally McManus has flagged more industrial action, picket lines and product boycotts to pressure com­pan­ies to offer more secure employ­ment.

Such activities, including the paralysis of the rail network in our largest city, undermine profits, confidence and economic growth. Productivity gains, conversely, increase wages and living standards. Mr Albanese must make it clear that above-inflation pay rises not backed by productivity improvements are unacceptable and irresponsible. Workplace relations should be a campaign issue.