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Wednesday, 23 June 1926


Senator NEEDHAM (Western Australia) . - This, as we were told by the Minister, is a temporary measure to bridge a gap between the expiration of the term of office of the Deputy Presidents of the Arbitration Court and consideration of the bill which the Government intends to bring down after the referendum proposals have been disposed of. But whilst it may be a temporary measure as far as the Deputy Presidents of the court are concerned, it contains provisions which, even if the referendum questions are negatived by the people, may, and probably will, become permanent features in our arbitration legislation. It makes certain vital and necessary amendments to the Commonwealth Conciliation and Arbitration Act. Except in regard to one or two provisions, it will have the support of honorable senators on this side of the chamber.We have always stood for the principle of arbitration for the settlement of industrial disputes, and while even to-day there are opponents of the system they cannot deny that from its very inception it has done splendid work.


Senator Pearce - Under great difficulties.


Senator NEEDHAM - I am coming to that. Despite all the handicaps and limitations under which the court has worked since it was constituted in 1904, the most bitter opponent of arbitration cannot but admit that it has done splendid work. No one would be foolish enough to say that, in the matter of industrial arbitration, we have reached the millennium, but until a more satisfactory means is devisedfor or ensuring industrial peace, we are justified in continuing the present system. Irrespective of the system we adopt, disputes will always arise, so long as -the present conditions prevail under which men have to barter with their labour. Under the capitalistic system which obtains to-day, conciliation and arbitration has proved the most effective and sane method of adjusting grievances between employers and employees. Although it cannot prevent disputes, it has certainly been the means of minimizing the number. Even with its limited powers the court has obtained wonderful results by means of compulsory conferences, which have often prevented industrial disputes.


Senator Thompson - And very often the court has to complete the conference proceedings.


Senator NEEDHAM - After a compulsory conference has been held, and the parties have agreed on vital issues, it is sometimes necessary to transfer the case into open court to validate the agreement, and to secure an award. The bill provides for the appointment of a chief judge and two other judges. The chief judge is to receive a salary of £3,000 a year, and the two other judges each £2,500 a year. The measure also provides for the payment of liberal pensions to the judges on retirement. I desire to indicate at this stage that I am opposed to the payment of pensions in such cases, and that it is my intention, when the measure is in committee, to take certain action in this connexion.


Senator McLachlan - Is the honorable senator opposed to the principle?


Senator NEEDHAM - I shall indicate later my reasons for opposing the payment of pensions. The chief judge and the two other judges will not have to contribute towards the extraordinary pensions which Parliament is to provide for them on their retirement. In introducing the measure in another place, the. Attorney-General (Mr.

Latham) said that the salaries which I have just mentioned were moderate, and that to attract good men pensions must be paid to prevent them from experiencing financial anxiety. I always believe in paying good salaries to those who render efficient service, but, after having done so, this Parliament should not be asked to relieve them from financial anxiety. If the Government always kept this principle in view the position of many public servants might be much better than it is to-day. There are men at present in the Commonwealth Public Service who are not being paid a remuneration commensurate with the responsible work they are performing. In many instances, the Public Service Board, the members of which are receiving good salaries, is not giving the public servants under its control even a reasonable salary.


Senator Findley - The board has not yet completed a classification of the Service.

SenatorPearce. - The Commonwealth Public Service is the highest paid public service in the Commonwealth.


Senator NEEDHAM - It may be, but that does not say that the officers in that service are well paid. As Senator Findley remarked, by interjection, the board has not yet classified the whole of the Service. I now wish to deal with that portion of the bill which relates to the qualification of the judges. The bill provides that a judge must be a barrister or solicitor of the High Court, or of the Supreme Court of a State, of not less than five years' standing. I do not consider that it is necessary to have a barrister or a solicitor to administer our arbitration law but, if legal training is essential, we should restrict our appointments in that direction to one judge, and make the other two appointees representatives of the parties concerned - the employers and employees. That would be a much more equitable method of determining the merits of any dispute than to have a chief judge and two other judges with the qualifications that are demanded by the bill.


Senator Elliott - Would the lay members be changed from time to time?


Senator NEEDHAM - I should make the appointment of the lay members for a period. In Western Australia the President of the Arbitration Court was for merly a barrister, but he has with him on the bench representatives of the employers and employees, who are appointed for a specified period.


Senator McLachlan - Is it not a fact that in practice the two assessors can never agree, and the judge has to decide everything ?


Senator NEEDHAM - That is not so.


Senator THOMAS (NEW SOUTH WALES) - The judges of the High Court cannot always agree.


Senator NEEDHAM - The presiding judge in Western Australia always gives his judgment after consultation with the representatives of both sides, and his individual opinion may be entirely changed sometimes as the result of such a consultation. Whilst I admit that a man who possesses legal training may be better able to sift evidence, it cannot be denied that the two men whose appointment I have suggested would have a practical knowledge of industry.


Senator Sir Henry Barwell - Does the honorable senator suggest that they should be appointed by the employers and employees ?


Senator NEEDHAM - Yes ; and their appointment should be ratified by the Governor-General in Council. Barristers and solicitors are not the only persons who are competent to arbitrate in industrial matters. Laymen would be more competent.


Senator Abbott - Would they not be partisans'?


Senator NEEDHAM - The Arbitration Court in Western Australia has been in existence for something like 22 years, and no one has ever suggested that any of its decisions has been of a partisan nature.


Senator Crawford - Although there is to be a chief judge and two judges, they will constitute separate tribunals.


Senator NEEDHAM - That has yet to be proved. In the press recently the qualifications of Mr. Stewart were discussed. That gentleman has been the registrar of the Commonwealth Arbitration Court almost since its inception, and he is in every way qualified to adjudicate in industrial matters. The area of choice of the arbitrators ought not to be restricted. Mr. Stewart has obtained a very good grip of industrial questions during his service under the different judges who have so ably presided over the court. The bill also provides that the judges shall have a life tenure. Although I am not altogether in accord with a life tenure for Arbitration Court judges, I realize that if the Commonwealth court is to be made more effective than it has so far been, it must be clothed with judicial powers, and that is not possible unless the judges are given life tenure.


Senator THOMAS (NEW SOUTH WALES) - Why?


Senator NEEDHAM - Because under the Constitution a judge who has not a life tenure cannot exercise judicial functions.


Senator THOMAS (NEW SOUTH WALES) - Why should not that power be sought at the proposed referendums?


Senator NEEDHAM - That would have been a wise course to adopt. I am not in the confidence of the Government, and I cannot assign a reason for the exclusion of that matter from the proposals that are to be submitted to the people. The bill further states that a judge can be dismissed only on account of misbehaviour or incapacity, and in pursuance of a resolution passed by both Houses of the Parliament in the same session. That is unlikely to happen. It is a tradition of the judiciary throughout the Empire that our judges have always been placed above party considerations, and made entirely independent. It is a wise provision, and it should be preserved. Any matter that comes before the court should be dealt with on its merits, without the slightest coercion or fear of retribution. Every judge, no matter what court he presides over, should be entirely independent of the Government of the day. If he were in any way dependent on the Government for the security of his position he might be unconsciously biased. Therefore, since it is essential to clothe the new court with judicial powers, I withdraw all opposition to the proposal to give the judges life tenure of their positions. I understand that, according to a ruling of the High Court, judicial authority can be exercised only where judges have life tenure of office. That is the reason why the judges of the Arbitration Court should be in that position. I now come to Senator Thomas's interjection to the effect that only by amending the Constitution can the necessity for life tenure be removed.


Senator THOMAS (NEW SOUTH WALES) - If we gave the people the opportunity at the next refer endum, they would readily agree to the alteration.


Senator NEEDHAM - I am afraid that the honorable senator is too late to have the proposal submitted at the forthcoming referendum. The Arbitration Court, under the present law, has no power to enforce penalties, nor has it any power to enforce its awards.


Senator Drake-Brockman - Nor to interpret them, although a police magistrate can. do so.


Senator NEEDHAM - That, is so. Imagine the parties having to go to a police court to enforce an award of the Arbitration Court. The higher tribunal is impotent to enforce its own awards, although the lower court can not only enforce them, but also impose penalties.


Senator Drake-Brockman - The parties can even go to the justices of the peace to have penalties imposed.


Senator NEEDHAM - Yes. The Arbitration Court should not be submitted to such indignity. One of the reasons why arbitration is so costly is the delay in obtaining and putting the awards of the court into operation. What should be a court of arbitration has become a court of litigation. Matters involving breaches of awards should not be dealt with by police magistrates, because they are not conversant with the merits of cases, and they are not in any way bound by the decisions of the Arbitration Court. Employers and employees may have spent months in preparing their cases, and frequently weeks, and even months, elapse before these can be heard by the court. Then an award is obtained, and when a breach takes place the case is taken to a police magistrate, who hears the evidence again. Consequently the absence of judicial power stultifies the awards of the Arbitration Court, which comes to its determination on the evidence adduced after it has made itself familiar with all phases of the dispute. The judge knows exactly what interpretation should be placed on his awards, and he ought to have power to properly interpret them in the event of any breach being committed. The grant of complete judicial power would, if I am am not mistaken, do away with the necessity for appeals to the High Court but I am not dogmatic on that point.


Senator Drake-Brockman - The honorable senator is now on dangerous ground.


Senator NEEDHAM - I am speaking as a layman, and I need to be careful in discussing a matter surrounded by legal difficulties, particularly since I am confronted by a number of honorable senators who are barristers. But I give it as my humble opinion that the court, under this bill, would have complete jurisdiction. I think that it will be admitted by honorable senators opposite that the delays that have been associated with arbitration in the past will be minimized.


Senator McLachlan - And appeals, too, will probably be minimized.


Senator NEEDHAM - Yes. If that is accomplished as a result of the bill, we shall have gone a long way towards popularizing our compulsory arbitration system. I have had personal experience of unionists becoming restive because of the delay inseparable from getting cases brought before the court.


Senator Hoare - It has occupied years, in some instances.


Senator NEEDHAM - Yes; and, after all the delay and expense, appeals in certain cases have been lodged with the High Court, and it has been held that the Arbitration Court had no jurisdiction to deal with them. I recollect the application made some years ago by the Australian Tramways Employees' Association, which was occupied for a little over two years in obtaining an award. A case was cited in the High Court, and a ruling against the association obtained.


Senator Lynch - Has not that difficulty as to the definition of a dispute been remedied ?


Senator NEEDHAM - I do not think so.


Senator McLachlan - The difficulty in that particular case may have been overcome, but there are other cases.


Senator NEEDHAM - Yes. The question of jurisdiction has often arisen since that time.


Senator Thompson - Does the honorable senator favour the Queensland system of not allowing legal gentlemen to appear in the Arbitration Court?


Senator NEEDHAM - One of my first actions in this Parliament was to submit a proposal to prevent legal gentlemen from appearing in court at all, unless with the consent of both parties.


Senator Drake-Brockman - I think that the honorable senator might improve upon that by providing "unless with the leave of the court."


Senator NEEDHAM - In arbitration matters we should endeavour to get away from the legal aspect. The question to b.e determined is one of equity, not of law. A good deal of confusion has arisen regarding this bill and the referendum proposals. I understand that the Government has deferred introducing its main arbitration bill until the result of the referendum has been made known. In the event of the proposals being accepted by the people, it will be introduced; but, if they are defeated, a bill within the limits of the present Constitution will be submitted to Parliament. The question of a life tenure for judges has nothing to do with the referendum proposals, but in that connexion there is much confusion in the minds of not only the people, but also some members of this Parliament. Even under the existing Constitution, certain powers are conferred on the Arbitration Court, although, in some respects, those powers are limited. For instance, the question of determining a standard working week is now before the court. Yet some people are wondering what power this Parliament will have to deal with that matter.


Senator Lynch - Would the honorable senator have Parliament to decide that matter ?


Senator NEEDHAM - I should like to see Parliament possessed of full powers to determine the hours of labour, and to fix wages and working conditions, and Parliament itself should determine how those powers should be exercised.


Senator Lynch - If Parliament fixed the hours of labour, it would have to go further, and fix the price of potatoes.


Senator NEEDHAM - Parliament should have full powers, and Parliament should determine the way in which they should be exercised. Where both a Federaland a State award operate in an industry, the Federal award overrides the other. We have had an instance of that recently in connexion with the question of a 44-hour week in New South Wales. The present Arbitration Act provides that certain questions relating to hours of labour can only be dealt with by a full bench of the Arbitration Court. One judge sitting alone cannot determine the question of hours. We are told that clause 7 has been inserted in order to obtain a determination from the full court regarding the question of standard hours and the basic wage. The proposed new section 18b reads - " 18b.- (1) The Attorney-General on behalf of the Commonwealth may, by giving the Registrar a notice in writing of his intention so to do, intervene in the public interest in any proceeding before the court in which the question of standard hours of work in any industry or of the basic wage is in dispute, in relation to either of those questions. " (2) Upona notice being given in accordance with the last preceding sub-section the Registrar shall cause the notice to be published in the Gazette. " (3) Upon publication of the notice in the Gazette any person, or organization or association of employers or employees may apply to the oourt for liberty to be heard and the court may, if it is of opinion that the applicant is interested in the determination of the question, permit the applicant to be heard and to examine and cross-examine witnesses. ' " (4) Upon intervention by the AttorneyGeneral in accordance with this section the court shall fix a day for hearing the question as to which he hasintervened and that question shall be heard and determined by the Chief Judge and two other Judges."

When the bill reaches the committee stage, I intend to move for the deletionof the words "person or" from sub-section 3 of the proposed new section. The AttorneyGeneral (Mr. Latham), speaking in another place, assured us that the intervention of the Attorney-Generalin this connexion is to allow persons interested to get before the court in relation to a dispute to which they are not a party. That may be so, but the proposed new section might have been worded differently. Its object is to enable the full bench of the court, with both sides represented, to make a full inquiry, in order that a general decision may be arrived at. That decision would be binding until the court itself altered it. According to the Attorney-General, a general rule would be binding on all Commonwealth awards. We must not confuse a general rule with a common rule. They are not the same. The existing Constitution permits the full bench of the Arbitration Court to make a general rule regarding these matters, but it may not make a common rule. In order to enable it to do so, an alteration of the Constitution is necessary. Another clause empowers the Governor-General to appoint conciliation commissioners. The work of these commissioners will be of great importance; upon their decisions a great deal will depend. The commissioners may not only conciliate in relation to disputes that have arisen, but "they may also endeavour to prevent disputes from arising. In my opinion, the prevention of a dispute is of far greater importance than the settling of a dispute that baa arisen. The appointment of conciliation commissioners should relieve the Arbitration Court judges of a considerable amount of work, and obviate some of the delays that now occur. Experience has shown that, frequently, timely intervention has resulted in the settlement of a trivial matter which, if allowed to develop, might have reached serious proportions. One reason why the measure is being hurried through Parliament is that the Government wishes to re-appoint two of the judges temporarily to finalize cases that have been before them for several months. Deputy President Sir John Quick and Mr. Deputy President Webb have spent much time in hearing claims by the Australian Railways Union and the Australian Tramway Employees Union, so it is only fair to the organizations concerned and to the deputy presidents themselves that they should be permitted to finish the cases.


Senator McLachlan - No one can blame lawyers for the delays in connexion with those claims.


Senator NEEDHAM - I am not attaching blame to any one. I am merely stating that the claims have been before the court for a long time, and it is only right that the deputy presidents who have been handling them should bc allowed to complete them. I intend to support the bill, in the hope that it will make our arbitration system more effective than it has been in the past, and that in future there will be fewer appeals to a higher tribunal.







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