Before the onset of the industrial relations reform agenda, employment status and compensation were products of compulsory arbitration or legislative action (Wooden, 2005). This set-up gave more free hand to the government sector to provide, prohibit, limit, or mandate workplace conditions, changes, reforms, and such other measures which are perceived as best measures to support employee efficiency and productivity. The effectivity of this paradigm gave Australia the prestigious recognition of being the first country to implement the 8-hour workday in 1856 (Workplace Relations and other Legislation Amendment Act, 1996).
The Workplace Relations Act of 1996 placed Australian industrial relations follows under a dynamic reform agenda from the traditional compulsory-mandated employment conditions at work to one which operates on trust between employer and employee on workplace conditions (Wooden, 2005). The Workplace Relations Act, which pushes for reforms at floor level, is the next big thing to employer-employee relationship. Employers and employees are free to enter into employment contracts or agreement within the framework and parameters of the Act.
Thus, the capability and fitness of the employee is matched with the employer’s capability to pay and work requirements. Instead of a mandated minimum wage rate or a legislated compensation, employers are granted the right to make an offer to employees who may be willing and interested to work given such circumstances. The Workplace Relations Act was attacked from many sectors – legislators who opposed its passage, unions, and civic society.
Their argument was based on the fact that by giving a free hand for employers and employee to enter into contractual relations that would serve as a guide of their employment relations, employees, in general, are placed at a disadvantage inasmuch as they no longer have the support of their union and the government. Security of employment and fair-day’s wage seemed threatened by such relations (Furey v Civil Service Association of WA Inc. , 1999). The Federal Government’s Fair Work Bill of 2008 takes effect on July 1, 2009.
This Bill puts back the strength of employees in their unions, thus giving the latter the power to be actively involved in enterprising bargaining for employees’ favorable conditions at work (Smith, 2009). Employment standards and modern awards will take effect subsequently on January 1, 2010 (Fair Work Bill of 2008). This flip-flopping stance which mandates the employer-employee relations in Australia can be discerned as government’s wide understanding of the sensitivities of the issue.
The two sectors, employer and employees, cannot harmoniously exist without the firm and unbiased intervention of government. Tripartism in this relationship is the key to stability, workplace harmony and industrial peace. In early ages of European industrial relations, unionism gained its strength through government legislations (Dwyer, 1991). There were three models of labor relations, namely Marxist unionism, Anarchistic unionism, British model.
Dwyer writes that parliamentary action and collective contracts at industry level characterized Marxist unionism or the Germany model. (Dwyer, 1991). Dwyer says anarchistic unionism dwelt on union protests as was employed in France, Spain, and Italy. The British model was characterized by plant level unionism (Dwyer, 1991). Government intervention was strong in protecting union rights. Along this light, it has been observed that industrial relations is driven by the political and economic structures and organizations (Thirkell, Petkov & Vickerstaff, 1998).
Legislation and awards dictate the relationship of employers and employees to the prejudice of the losing party. In every battle, there is always a losing party and in a win-win situation, there are always lost proposals. In the United States, the Fair Labor Standards Act of 1938, grants protection of labor rights for employees in private and public institutions. Thus, strikes are a common place where union issues are not addressed and resolved. Government legislations are the strengths of employees’ security of tenure and conditions at work.
Unions are perceived by employers as limiting factors to what could otherwise be an absolute exercise of management prerogative. Thus, in the exercise of their rights and with the extensive labor laws protecting the rights of labor, employees see the opportunity to raise to proper forum and venue whatever complaints they may have against their employer. Government, on the other hand, tasked by law to protect labor rights, grant sizeable awards to employees in complaints for unfair labor standards at work and unfair labor practice.
With the growing number of issues in employer-employee relations, the government has initiated a program on labor-management cooperation whereby employers and employees seek to understand each other’s interests. This initiative is noble but the strategies towards its accomplishment is rather a gargantuan task. Through the years, labor management cooperation initiatives have always been looked at with a doubt as to whether or not the same is beneficial to both parties. Unions, too, do not readily welcome this initiative which is seen as a limiting factor in their advocacy for union and employee rights.
However, in the recent developments where economic crisis has affected almost all industries in the United States, employers come to the realization that employer-employee relationship operates on trust (Miles & Nathan, 2009). It is not the dominance of government that is the key to harmonious industrial relations. Rather, it is the interplay and the cooperation among the three key players – government, employees, and employers – that bring about industrial peace. The dominance of one creates polarization and friction placing industrial relations at an odd stake.
It is essential, therefore, to define the roles of government, employers, and employees in any reform agenda which is aimed to promote industrial relations. The role of government cannot be undermined in an employer-employee relationship because government has to protect the rights of both parties. These rights include work safety and work security. As in the case of Hillman v Poole, government was able to adjudicate equitable rights by ascertaining the culpability of employee, in the person of Poole, who failed to observe employer’s safety policies resulting to the death of Poole’s co-employee (Hillman v Poole, 2008).
In the United States, labor-management cooperation is supported by the strong arm of government by promoting workplace harmony, setting minimum standards, and facilitating the improvement of workplace conditions and relations through mutually agreed programs between employers and employees. In such case, government has not pounded its strong hands into employers or employees; government acts as a mediator in promoting understanding, trust, and good relations. Australian industrial relations has a way to go with the forthcoming implementation of the Fair Work Bill of 2008.
Under this Bill, government has to transform from compulsory-mandated awards and work standards into a mediator role promoting enterprise-level employment agreements. The role of government under the new Bill is to ensure proper and timely compliance to internal, external, and environmental factors which may have direct or indirect implications to workplace conditions (Lepahe, 2009). Thus, where laws are not observed, it is the responsibility of Government to correct the gaps by providing avenues for assertion of rights and claims through mediation, arbitration, and conciliation.
Section 228 of the Fair Work Bill of 2008 provides that employees have the right to be represented in the enterprise bargaining. However, the same section also stipulates that bargaining representatives must meet the good faith bargaining requirements such faithful attendance in meetings, disclosure of data relevant to bargaining, timely and effective response to any proposal presented by bargaining representatives, and not to engage in unfair conduct during the entire bargaining process (Lepahe, 2009).
The Fair Work Bill of 2008, which is now referred to as Fair Work Act 2009 as its implementation will be initiated in July 2009, is a milestone of industrial relations in Australia (Tuck & Pesutto, 2009). The Fair Work Act of 2009 brings back important provisions into industrial relations in Australia which can only be achieved through strong tripartite relations. Government has to set firm policies on minimum work standards with wide flexibility towards comprehending the various intricacies in employer-employee relationship.
Government cannot hold at an arm’s length this fragile relationship where opposing interests are still sought in adversarial manner. Until such time when employer and employee relations have matured into one of full cooperation, government takes an active but not a dominant role in ensuring that all the provisions in the Fair Work Act 2009 are observed and implemented. In a tripartite system of workplace relations, the government, the employees or the union, and the employers or management rely upon each other’s strength in order to promote workplace harmony and goodwill.
The key driver is cooperation and promotion of mutual interests. It is not a give and take relationship; rather, it is a concurrence of proposals geared towards the promotion of business interests which could redound to employee benefits for the common good. On the part of government, where employer and employee understand each other’s point of view, legislating and Each element of this tripartite relationship is duty-bound by law to give full support to the promotion and development of employees who are members of employees’ union. The aim is to sustain industrial relations.
Australian industrial relations is way ahead in its endeavor to build on employer-employee relationship under the guidance, effective, and timely interventions of government. While other countries are still enacting legislations which would set the parameters of industrial relations, Australia has already embarked on its reform agenda. Government established its role by enacting the law with the determination to implement the same within the timelines even if times and circumstances may not be fully at its side with the economic situation that the world is in at this very moment.
Setting the limits and creating boundaries within which each sector could assert its right is the paradigm in the new Fair Work Act of 2009. References Circular No. 2000/1: Workplace Relations Act 1996. Impact on payments instead of notice of termination. June 28, 2000. Currie, John. Industrial Relations in Australia. 2006. Dwyer, Richard. Labor Relations in Europe: A History of Issues and Developments. Aug. 1991. Fair Work Bill of 2008. Fair Labor Standards Act of 1938. Furey v Civil Service Association of WA (Inc)  FCA 1492. Hillman, Roger Lyall v Jeffrey Poole  SAIRC 33.
Magistrates Court of South Australia (Industrial Offences Jurisdiction). File No. 7423 of 2008. Lepahe, Heinz. Australia: Good Faith Collective Bargaining. April 20, 2009. Miles, Stephen and Bennett Nathan. The Changing Employer-Employee Relationship. Businessweek. March 31, 2009. Petkov, Krastyu & John E. M. Thirkell. Labour Relations in Eastern Europe: Organizational Design and Dynamics. 2004 Restructuring and Privatization in Eastern Europe and Russia. The Transformation of Labour Relations. Smith, Martin. Australia: Significant Changes in the Law Governing Workplace Relations Commence in 2009. February 26, 2009. Thirkell, J. , K. Petkov and S. A. Vickerstaff.
The Transformation of Labour Relations: Restructuring and Privatization in Eastern Europe and Russia. 1998. Oxford University Press. Oxford, New York. Tuck, John and John Pesutto. Australia: Transition to Fair Work Australia. April 20, 2009. Wooden, Mark. Australia’s Industrial Relations Reform Agenda. Melbourne Institute of Applied Economic and Social Research, University of Melbourne. Invited paper presented at the 34th Conference of Economists, 26-28 September 2005, University of Melbourne. Workplace Relations Act of 1996. Workplace Relations and other Legislation Amendment Act. 1996.