ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 1
ContentsContents
Origins of wage fixation and industrial relations system
The Accord: 1983-96
Why the system failed & the deregulation debate which followed
The 1990s reforms & effects
1.
2.
3.
4.
1920
1940
1960
1900
Australian wage fixation:
1896-1970
1896: The Victorian Wages Board determines minimum rates in some industries
1921:Quarterly cost of living adjustments to basic wage begin & above-award margins for skil widely paid 1931: Arbitration Court cuts
some Federal awards by 10% - capacity to pay recognised
1953: Quarterly cost of living adjustments abandoned
1907:Harvester Case establishes principle of "a fair and reasonable wage" - a basic wage.
1967: Commission abolishes Basic Wage and margins from Commonwealth awards and substitutes a single total wage.
1904:Federal Arbitration Court established
1969: Equal pay for equal work recognised.
1941-43: Strikes and absenteeism outlawed. Cost-plus profits guaranteed for employers
1985
1990
1996
1980
Australian wage fixation:
1970-2000
1974: National Wage Case grants equal minimum wage to men and women
1982-83: Wages pause. Real wages fall by over 9%
1983: Accord Mark I re-establishes centralised wage fixation based on full indexation to CPI
1987: Accord Mark III. Commission creates two tier system: flat rate and second tier
1981: Wage indexation abandoned
1991: Top-downenterprise bargaining allowed through Commission
1975: Quarterly wage indexation re-introduced
1992: Industrial Relations Act amended to allow easier certification of agreements
1985: Accord Mark II focuses on superannuation and WorkSafe
1998: Waterfrontreform commences
1996: Accord ends & Industrial Relations Act emphasises collective bargaining
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 2
Main features of old IR system
Highly centralised and legalistic system, inherited from New Zealand.
Arbitration Commission seen as an independent "engineer with an oil can which would reduce industrial friction.
ie. industrial relations taken away from workplaces, placed in tribunals
1.
2.
3.
Why did both unions and employers support compulsory arbitration?
Unions defeated in strikes of 1890s. Saw arbitration an alternative. Trade unions also legalised under system - led to sharp rise in membership.
Employers believed State could be used to reduce militant union power
Part of turn-of-the-century belief in "civilizing capitalism"
1.
2.
3.
The Harvester Judgement1907 Justice Higgins handed down judgement in the Harvester Case, enunciating the principle of "a fairand reasonable wage"
ie the minimum wage needed to support a family in frugal conditions.
The notion of the Basic Wage is established and forms the basis for wage fixing for the next 60 years.
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 3
The Harvester Judgement continued
Emphasis was on needs, not capacity of economy to pay - although Justice Higgins believed that wage rises should not be allowed to squeeze profits too much.
7/- a day set as Basic Wage - took it from NSW Railways workshop - not a genuine "needs" analysis.
From 1921, changes in cost of living became a basis for wage rises
The Harvester Judgement and the "New Protection"
Increasing protection for manufacturers considered OK as long as they paid a "fair and reasonable wage".
This the foundation of pro protection alliance between labour movement, Labor Party and manufacturers which lasted through to the 1980s.
New Federal Government also keen to use protection to collect revenue to fund its activities.
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1920s developments1920: Arbitration Act amended to allow for variation of awards during their lifetime.
1921: Establishment of quarterly cost of living adjustments to the basic wage.
Late 1920s: Cost of living adjustment principle led to wage-price-cost merry-go-round .
1929: The Brigden Report examines problem and enunciates the "infant industry case" for continuing protection
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 4
Wag
e ris
e, p
rice
rise,
cost of living, wage rise merry-go-round
Commission grants wage rise following rise in cost of living
Wage rise increases employers' costsand they demand rise in protection
Employers demand rise in protection and assistance, cost of imports rises further
Commission grants wage rises in response to rise in cost of living
1931 Basic Wage case
Cuts Federal awards by 10 per cent
Introduced an alternative criterion to " need": the capacity of the economy, or more correctly individual industries and employers, to pay.
The argument against cutting wages was best expressed by a cartoon of that era: "How could we buy more after a wage cut, when we can't afford to buy what is already in the shops".
In 1934, the Arbitration Court restored the 10% cut
1.
2.
3.
4.
When Arbitration Court restored the 1931 cut in 1934, it stressed:
It was not it's function "to support or oppose" any "radical reforms in the principles and methods of distributing the products of industry":
"This Court is created only to prevent or settle industrial disputes within the meaning of industrial disputes as understood at the time when the Commonwealth Constitution was established".
ie Did not see its role to fix wages according to ups and downs of the economy or play a "Robin Hood"
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 5
1950s & 1960s1950: Basic minimum wage for women fixed at 75% of current male basic wage. 1953: Quarterly cost of living adjustments abandoned. 1967: Commission abolishes Basic Wage and margins from Commonwealth awards and substitutes a single total wage. 1969: Equal pay for equal work recognised.
Whitlam and wages1974: National Wage Case grants equal minimum wage to men and women. Helps produce smallest wages differential between males and females outside of Scandinavia
Whitlam Government supports metal union demand for sharp wage rise at a time when world economy and Australian economy slowing sharply
1975: Quarterly wage indexation re-introduced and National Wage Case grants sharp rise. Hurt manufacturers hard, at a time when demand had fallen.
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Gough Whitlam, PM 1972-75
Recession of the early 1980s
1981: Fraser Government abandons wage indexation
1982-83: Fraser's wages pause. Real wages fell by over 9%.
"Wage explosion then follows, which further hurts manufacturers and produces job losses.
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Mal Fraser, PM 1975-83
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 6
The Accord: 1983-96
Deal done in 1983 between Bob Hawke & Paul Keating with ACTU to roll Bill Hayden as the then leader of Labor Party
Three main goals:- maintain real wages - maintain "social wage" - social security- more interventionist industry policy
Deal done in 1983 between Bob Hawke & Paul Keating with ACTU to roll Bill Hayden as the then leader of Labor Party
Three main goals:- maintain real wages - maintain "social wage" - social security- more interventionist industry policy
The Accord: 1983-1996
1983: Accord Mark I re-establishes centralised wage fixation based on full indexation to CPI.
1984: ACTU "Way Forward Plan" emphasises the "social wage", sex discrimination and Medicare.
1985: Accord Mark II focuses on superannuation and WorkSafe.
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Accords III-IV
1987: Accord Mark III.
Commission creates two tier system: flat rate and second tier only available to those who show restructuring and efficiency outcomes.
1988: Accord Mark IV.
National Wage Case adapts award restructuring principle, wage rises linked to review of awards with view to efficiency and greater job satisfaction.
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 7
1989: Accord Mark V
to overhaul, simplify and build flexibility into awards
and protect weaker groups by raising low rates of pay.
1.
2.
Main aims:
But not a serious step towards greater labour market flexibility
1990-92: Accord VI
1990: ACTU major drive to reform training and education system.
1991: Enterprise bargaining now allowed to proceed generally through the Commission
1992: Industrial Relations Act amended to allow easier certification of agreements within the Commission.
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Employment growth
low inflation
enterprise agreements
award safety net
training and superannuation.
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1993: Accord Mark VII
Theme - "Putting Jobs First". Stressed:
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 8
1995: Accord VIII
Further safety net rises for award employees, ranging from $9-12 a week, spread over 1995-1998. Low wage earners to receive $11-14 rises.
Commitment to create 600,000 new jobs June 95- June 1998 and achieve 5% unemployment rate by year 2000.
Commitment to keep annual "underlyinginflation rate within 2-3 per cent per annum.
But Accord ended with defeat of Labor Government in March 1996
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The Accord: 1983-1996% change on a year earlier
ABS 6301.0/6401.0
123412341234123412341234123412341234123412341234123412341234123412341234123412341234123483 84 85 86 87 88 89 90 91 92 93 94 95 96 97 98 99 00 01 02 03 04
0
2
4
6
8
10
12
14
16
18
-2
-4
Average weekly earnings
Consumer price index
Note that real wages not maintained for most of 1980s, despite fact that this the main
Accord aim - i.e. CPI higher than AWE
But note that they have risen solidly since 1996, despite end of Accord
Note how crazy wage policy was in early 1980s!
(Total factor productivity growth- rolling average*)
The Accord's biggest failure
ABS 5206.0, 5231.0 and Treasury estimates..* Rolling average growth rates - six years to the year shown.
2.0
3
1.0
0.01970-71 1997-981990-911980-81
NB: The poor productivity growth in the 1980s, when the Accord was most important. Hence the
suggestion that it took our eye off the productivity ball.
% annual growth
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 9
Accord helped public servants during downturn
(May 1990-May 1993)
Managers/admin.
Professionals
Para-professionals
Tradespersons
Clerks
Labourers etc.
All occupations
0 2 4 6 8
av. annual % change in total earnings
Public sectorPrivate sector
But higher earnings growth meant higher unemployment
#
#
#
#
#
#
#
#
#
##
## #
##
##
#
75/76 77/78 79/80 81/82 83/84 85/86 87/88 89/90 91/920.14
0.15
0.16
0.17
0.18ratio
0
2
4
6
8
10
12
14% of workforce
Earnings/employment*Unemploy. rate (right axis)
#
* real wages, salaries & supplements/employment
Australia's rise in unemployment rate greater than most other Western
economies, 1960-1996US
Japan
Canada
UK
NZ
Australia
France
Germany
0 2 4 6 8 10 12-2
Percentage point change in unemployment rateSource: RBA Bulletin, June 1997
NB: the much lower rises in first 4 economies - including
Canada which is probably the most similar economy to
Australia
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 10
Mega unions took over during Accord era
(Numbers in brackets = number of unions)
Source: ABS 6323.0; June 94 figures
< 10,000 members
> 100,000 members
0 10 20 30 40 50 60 70
% of total membership
1984 1994(265 unions)
(120 unions)
(4 unions) (13 unions)
Trade union membership has fallen sharply
1986 1988 1990 1992 1994 1996 1999 200320
30
40
50
60financial members as % total employees
Males Females
Young deserted unions particularly(% of employees in unions)
15-19 20-24 25-34 All ages Private sector5
15
25
35
45
55
%
1982 1994 1999
Age groups
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 11
Trade union membership now much higher in public sector
Data: Source: Employee Earnings, Benefits and Trade Union Membership, Australia, August 2003 (6310.0).
52.4
19
24.1
42.4
15.8
21.8
46.9
17.6
23
Public
Private
All sectors
0 10 20 30 40 50 60
Membership as a % percentage of total employees
MalesFemalesPersons
Membership falls across the board
www.abs.gov.au/Ausstats/[email protected]/Lookup/81816F252134D252CA256F7200832F0B
Reasons for membership fall
Feminisation of workforce - women have much less interest in unions than men
Job creation over past decade largely in white-collar, non-unionised areas
Growth of part-time and contract employment
Accord 1983-1996 and union amalgamations isolated union leaders from members
1.
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4.
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 12
The aims of deregulationIndustrial relationsEmployee relations
The past The future
Underlying beliefs
ConflictLow trust
Central control
Mutual interestsIncreased trustIndividualism
Flexibility
Uniformity
Why the old system failedWages set by arbitration
on social rather than economic grounds
Gave unions legal recognition and distanced them from their members
Wages set by arbitration on social rather than economic grounds
Gave unions legal recognition and distanced them from their members
Industrial relations debate between two main groups
Labour market deregulators who want a reduction in central regulation of labour conditions and wages and more emphasis on direct negotiations between employees andemployers.
Defenders of the status quo who argue that such a move will reduce the power of unions and lead to the loss of rights and employment conditions which were only won after years of struggle between employers and unions.
1.
2.
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 13
"Vision" of deregulation group
A faith in what Adam Smith called the "invisible hand" - in other words, market forces.
The deregulators believe that if labour markets are not regulated:
- supply and demand will set wages
- the labour market will then "clear" - there will be no continuing unemployment
- and labour will move between industries most productively.
Alternative "vision" of anti-deregulation group
A faith in intervention and regulation.
Real world labour markets are very different to the textbook world of the deregulators, they argue.
Employees are not homogeneous: they learn on the job, they are not all "rational economic men" making job choices on purely economic grounds, who slide up and down the indifference curves of their economics textbooks in search of their equilibrium point.
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Deregulators argue unemployment can be reduced by labour market
reformArgue that unemployment is caused by regulation, rather than unemployment being a rationale for it.
Argue that the interventionists have neglected the micro-economics of unemployment, in their belief that appropriate fiscal and monetary policy measures would be sufficient.
Argue we should devote a lot more attention to micro-economic matters - rather than macro-economic ones - to such issues as wage and other costs of production, work organisation, the role of unions etc.
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 14
Regulators argue unemployment not just a microeconomic issue
If labour markets clear so easily, they argue, then why is some unemployment the norm, rather than the exception?
Besides, weaker groups of employees require protection from "the anarchy of market forces", they add. Also point to simple fact that those looking for a job usually much greater than job vacancies.
Deregulators reply that deregulation, by removing barriers to job creation, will see a dramatic rise in such vacancies. Their critics reply that jobs will only rise sufficiently if demand for goods and services is sufficient.
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Negatives of old system Complexity of awards - State vs Federal etc - discouraged workplace restructuring. Meant some companies had to deal with over 25 unions.
Encouraged demarcation disputes between unions. Indeed, in some years more days lost from such disputes than from unions fighting employers.
Discouraged enterprise negotiations - producing a "let's all go home and leave it to the tribunal" attitude.
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3.
Negatives of old system
Restricted wage differentials, providing a disincentive to improve skills etc.
Discouraged interest in profit sharing and other remuneration methods which pay the worker rather than pay the job.
Created an "Industrial Relations Club" - too legalistic approach to IR.
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5.
6.
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 15
Negotiation was minimalNegotiation was minimal(% of disputes by method of settlement, 1990)(% of disputes by method of settlement, 1990)
Negotiation15.9%
Fed./state legislat.22.3%
No negotiation60.6%
Other1.2%
Enterprise bargaining: was too limited & imposed from on high
Data asource: ACCI Report Dec '95/ACCIRRT Quarterly Report, Dec, '95
In non-union sectors
With profit sharing
With performance pay
Initiated by manager
By manager
Negotiated by head-office
At shop-floor
0 20 40 60 80% of 1520 1995 agreements
beyond workplace
at workplace
union officials
ie. rewarding job, not employee
Enterprise bargaining other limitations
Heavily concentrated in public sector and slow to develop for private sector employees on Federal awards
Agreements reached often not based on genuine productivity gains
Full scope for productivity rises not developed
From "outside" - rather than a product of on-the-job discussions
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 16
Productivity growth fluctuated markedly
Industry Commission (1997), Assessing Australia's Productivity Performance
Late 1960s - early 1970s
Early 1970s - mid 1980s
Mid 1980s- late 1980s
1990-96
0 0.5 1 1.5 2 2.5% annual average growth in multi-factor productivity
NB: poor growth in late 1980s
IR systems & productivity: no simple relationships
GDP % growth per capitaCanada 2
USA 3
Canada 1&3UK 3USA 1&2
UK 1&2
NZ 1,2&3
AUST 1AUST 2
Japan 3
Austria 2Sweden 1
Japan 2AUST 3
Austria 1&3
CentralisationLess More
** *
Source: EPAC
*****
**
**
*
*
2=1970s3= 1980s
Key
2
1
3
1=1960s
Main 1996 industrial relations changes
Individual contracts called Australian Workplace Agreements (AWA's) as alternative to awards
Reduced union powers by restricting right of access to
workplaces, abolishing "compulsory" unionism and allowing disamalgamations
Reduction in powers of IRC & greater workplace
negotiations
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 17
Arguments for changes1996 ACT
Greater flexibilityfor employers
More jobs &lower labour costs
Less trade unionpower
Means skilled willbe better off, unskilled likely tobe main victims
More competitive economy
Improved balance of payments, higher growth & possiblylower interest rates
Registered collective 42.0%
Award safety nets22.0%
Over-award & 22.0%
Individual arrangement14.0%
Wages: how they now set% of total employees
agreements
unregistered agreements
From a 1999 DEWRSB survey
Collective agreements:two main types
Largely in three sectors:- construction- metal engineering (eg . cars, white goods, fabrication- road transport
10-12% of workforce
Have won 4-6 % pay rises per year
Employer driven
Largely in three sectors- big retail chains- mining (except coal)- non-banking finance, especially insurance
2-4% pay rises dependent on trade-offs of working conditions, work on weekend etc.
Union-driven
ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 18
What employees thought of workplace change 1990-1996
1995-96 Australian Workplace Industrial Relations Survey
Work effort increased
More stressed
Work pace intensified
0 10 20 30 40 50 60% of employees surveyed
No negotiation was the order of the day(Percentage of total working days lost, year
ended October 1997)
ABS 6321.0
Trade unionismWages
Leave, pensions etc.
Managerial policy
Working conditions
Other
Hours of work
0.9%14.0%0.5%
63.6%
2.1%
18.3%
0.5%
Negotiation9.8%
State legislation4.6% Fed-State legislation
7.4%
No negotiation77.9%
Other methods0.2%
Cause of dispute Method of settlement
Awards also being simplifiedThe AIRC made a landmark decision on 23 December 1997 to establish clear principles for award simplication, starting with the hospitality industry award.
Additionally, the parties themselves are taking action to simplify their awards.
For instance, the MTIA and the metal unions have made substantial progress in simplifying the key Metal Industry Award.
Government believes that the overhaul of the award system will bring a range of benefits: increased opportunity and momentum for agreement-making; many more opportunities than before for adapting working arrangements to suit the particular needs of the workplace; and awards which are easier to understand and apply.
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 19
Employees have more freedom For employees dissatisfied with the service provided by their union, the Act makes it easier for them to resign: only two weeks notice is now required.
Employees at an enterprise can now establish their own enterprise-based union. For example, the Ansett Pilots' Association registered the first enterprise association and at least two more applications are in the pipeline.
A number of unions have already applied to disamalgamate.
Employees are also now free to choose who, if anyone, they wish to have bargain on their behalf.
As a result, the Government argues that the role of unions is now dependent on the wishes of their members rather than legislative entitlements.
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Preferential treatment for union members abolished
The Act has abolished preferential treatment for union members and outlawed ‘closed shops' (arrangements whereby all employees at a workplace were forced to belong to a union).
It has also prohibited discrimination on the basis of membership or non-membership of a union. Any attempt by a union to coerce an employer to breach the Act in any of these ways will attract substantial penalties.
For those who believe that their freedom to choose has been restricted or that they have been discriminated against because of their decision to join or not to join a union, the Employment Advocate can help to ensure that their rights are enforced.
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Right to strike maintainedEmployees have a specific and limited right to strike during the negotiation of agreements and employers have a similar right to lock out employees.
However, an employee or union must not take industrial action to support or advance further claims during the period of operation of a certified agreement. Industrial action in relation to the employment to which an AWA relates is prohibited during the period of operation of the AWA.
The AIRC has been given strengthened powers to stop or prevent unlawful industrial action. The Federal Court can enforce Commission orders by injunction and can award damages where the orders have not been observed. Non-compliance with an order can also lead to union deregistration.
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 20
Additionally
Industrial action aimed at and having the effect of hindering interstate or overseas trade and secondary boycotts (for example, when one unit goes out on strike to aid the campaign of another ) are both now prohibited and damages can be awarded against parties undertaking such activities.
Also now illegal for employers to pay employees when they are engaged in industrial action.
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Working time flexibility was increased
% of enterprise agreements which specify a normal span of work of 12 hrs + per day
1992-93
1994-95
1996-97
0 5 10 15 20 25 30 35 40
Source: ACIRRT, Sydney Uni.
Nearly one-third of jobs now part-time
19
26
3133
28
19881997
19992002
2005 (March)0
5
10
15
20
25
30
35
40
% of total jobs
ABS 6310.0
Part-time work much more common among female employees
75% of part-timers don't want increased hours
Note fall in part-time jobs as % of total recently.
Has also been big growth in contracting and self-employed over past decade.
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 21
Effects on part-time workers
Regulate maximum or minimum hours of work
Make awards restricting the % of part-time employees a firm can hire
Make awards that force employers to hire a set ratio of apprentices to skilled tradespersons
RESULT: Employers are likely to make greater use of part-time labour, employing for as as little as one hour at a time
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Ends IRC's former powers to:
Earnings differentials grew( % increase in full-time earnings, Aug. 1995-Aug. 1997)
12
25
6
All full-time workersManagers/administrators
Labourers/related workers0
5
10
15
20
25
30
ABS 6310.0
End of Accord has meant end of national wage cases
National wage cases abandoned in 1993. "Safety net" wage rises since are not national wage cases - as media implies.
Therefore, now have no wages policy and no ACTU commitment to limit wage rises to inflation rate.
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ECON2313:Australian Economic
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Industrial relations & wage policy
Copyright: David Clark 2005 22
But unlikely to suffer "wage explosions" a la mid 1970s, early 1980s
and early 1990sIRC no longer has power to pass on wage rises won by one group to others
Increased competition from overseas means employers less able to pass on wage rises to prices
Greater mobility of capital means overseas-owned companies will simply manufacture elsewhere if wage growth here too high.
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Role of awards post 1996Awards now provide a safety-net of minimum wages and conditions rather than setting the actual wages and conditions of workers, as they did under the old system.
Awards are now also clearly limited in terms of the employment conditions they can include.
New awards are limited to 20 allowable matters and existing awards should be simplified to only include these matters by 30 June 1998. After this time all award matters which are non-allowable became non-enforceable.
1.
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3.
Good guide to Australia’s current award system:
www.australianbusiness.com.au/abl/abol.nsf/BUFrameurl?open&url=/abl/bustips.nsf/All/E1D2C062420CABB24A256EF500839635?OpenDocument&Highlight=0,industrial,disputes
Monetary policy now the main tool used to influence wage outcomesReserve Bank has made it clear that if wage growth produces too high an inflation rate, it will push up interest rates to slow growth in economy and reduce union bargaining power
An annual inflation rate above 3% is deemed unacceptable
ie. Wages not left purely to "market forces". For example, if wage growth "excessive" - ie likely to push inflation above 3 % per annum- Reserve Bank will react by pushing up interest rates
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ECON2313:Australian Economic
DevelopmentLecture 6
Industrial relations & wage policy
Copyright: David Clark 2005 23
Industrial disputation returned to 1960s levels
Source: RBA Australian Economics Statistics, 1949/50 to 1994/95/ABS 6321.0
### ### ### ##
####
### ##
# ####
#
#
#
#
#
#
##
####
# ####
#####
### ### #
1950 1955 1960 1965 1970 1975 1980 1985 1990 1995 20000
1
2
3
4
5
6
7Thousands
No. of disputesTotal workers involved '000Total working days lost '000
#These periods of recession but notebetter figures over past decade
Metal products days lost much lower
1970 1975 1980 1985 1990 1995 20000
1
2
3
4
5
6
Days lost per thousand employees
These periods of recession but note
better mid and late 1990s figures
Wages & productivity: growth periods
Source: RBA Bulletin, May 1997
5.5 yr. growth cycles, % annual
growth
Labour productivity
Capital stock
Labour hours
workedReal wages Total factor
productivity
I. Mar 75-Sep 80 2.3 3.5 0.9 2.8 1.4
II. Mar 83-Sep 88 1 3.1 3.6 -0.3 1.2
III. June 91-Dec 96 1.8 2.2 1.8 0.3 1.6
NB: re 1991-96 cycle
Data: RBA Bulletin, May
97
But real wage
growthrestrained
NB: microeconomic reformhaving an
impact
Labour productivity
growth poorerthan 1975-80
Reason:capitalstock
growthpoorer
Hours worked
growth alsoslackened