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Wednesday, 12 May 1965


Senator GORTON (Victoria) (Minister for Works) . - I move-

That the Bill be now read a second time.

This Bill stems from proposals made to the Government last year by the Australian Council of Trade Unions. They related to the sanctions provisions contained in sections 109 and 111 of the Conciliation and Arbitration Act. Sections 109 and 111 enable the Commonwealth Industrial Court to enjoin breaches of awards or order compliance with awards and to deal with contempt of its orders. As is the custom, in relation to matters of this sort the views of the national employers organisations have also been carefully considered.

To start with I think I should set before the Senate a number of propositions which are relevant to the Bill. First, sanctions in one form or another are an essential part of our arbitration system. The Government has no intention of removing them. Secondly, proceedings before the Commonwealth Industrial Court under sections 109 and 111 should be used only as a last resort. Thirdly, in its positive approach to industrial relations the Government wishes to encourage responsible discussions between the parties when claims are made and wants to encourage the parties to take full advantage of the conciliation machinery provided in the Conciliation and Arbitration Act.

It is necessary that we keep the sanctions provisions of our legislation in perspective. In fact, they have a minor place, if an inevitable and necessary one. Let me demonstrate this. Over the last 15 years the average time lost by every wage and salary earner in Australia has been just under 21/2 hours a year. Of course, there have been fluctuations. Last year, the figures showed a worse record than the previous seven years. Of course, the record in some industries is well above the average of industry at large. The stevedoring industry is a notoriously bad example of an atypical performance.

The following sets of figures covering the last 15 years illustrate the extent to which the sanctions provisions have been used. The number of strikes per annum has averaged 1,248 and the number of applications under section 109 and its predecessor section 29 have averaged 26. To carry the illustration still further, the number of orders made absolute on applications under the sections I have mentioned has averaged 14. Now it is difficult to argue from these figures that there has been an excessive resort to sanctions. The figures relating to sanctions are, of course, confined to proceedings unders our Act whereas the loss of man hours and strike figures relate to all jurisdictions, Commonwealth and State. Even when account is taken of this, the point still stands.

There is no argument that the unions have the right to try to improve the wages and conditions of employment of their members. Accepting this, there must be a limit to the kind of industrial action a sophisticated community like ours can be expected to tolerate. This is particularly so where there is highly developed machinery for determining wages and conditions of employment. In some cases real grievances exist. Most cases which have led ultimately to resort to the sanctions provisions have involved claims for more than the award provided. There have been cases where advantage has been taken of the shortage of labour to make irresponsible and excessive demands. In other cases industrial issues have been the cloak for the promotion of dubious political objectives.

It is not surprising that, faced with some situations, employers have felt obliged to resort to the sanctions provisions. We often hear the argument that the mere resort to the sanctions provisions, let alone their existence, contributes to industrial unrest. This is the type of propaganda which seeks to confuse the symptom with the illness. What is necessary is that an attempt should be made to cure the illness. It may well be that in some industrial disputes individual employers may have failed to show the wisdom of Solomon. But honorable senators would probably concede that even Solomon would have not sustained his reputation if he had had to deal with the thorny problems which arise in the field of industrial relations.

As a Government, faced with the responsibility of protecting the community's interest, our problem has been to seek a solution which will encourage responsible discussions when claims are made and, as necessary, resort to the conciliation machinery provided for by the Conciliation and Arbitration Act. If this occurs the risks of work stoppages will, of course, be reduced and consequently the need for resort to sanctions will diminish.

Let me make it clear that the Bill now before the Senate - starts from the assump tion that reasonable people will act responsibly. Conciliation can function only in these circumstances and whether or not it is between the parties directly concerned or is done with the aid of a conciliator. Of course conciliation involving even the most responsible people may lead to a stalemate. It may lead to a stalemate because there is no reason why claims should always be conceded in whole or in part. If there is real merit in a claim then one would expect that responsible negotiators would find it possible to meet the claim in whole or in part.

This Bill deals only with a situation where a breach of an award has not occurred. If one side or the other has decided, in effect, to take the law into its own hands, it must take the consequences. The consequences of such actions are those for which the existing legislation provides. As I have said, this Bill applies to situations where a breach of an award has not occurred, though there may be the threat of a strike or some other form of direct action. The Bill says, in effect, that the Commonwealth Industrial Court cannot commence to hear an application for an injunction against somebody in respect of a breach or non-observance of an award unless it is satisfied that three conditions have been fulfilled.

The first condition is that the Conciliation and Arbitration Commission has been notified that a breach or non-observance is likely to occur. The second is that that notification was given without delay or where there is delay the Commission has certified that there is reasonable cause for it. We do not base our thinking on the assumption that where an argument starts the employer must immediately notify the Commission. The employer may very well consider that given the opportunity for discussion with the union the threatened breach will not eventuate. With this in mind, if the employer commences discussions and they are abortive, then the employer should not be denied his remedy simply because he has failed to notify the Commission when the matter first arose. This is the sort of situation in which the Commission would certify that there was reasonable cause for the delay in giving the notification.

The third condition is that a period of 14 days or such longer period as the Commission has determined must elapse since the notification was given to the Commission. What is in mind is that if the Commission in its conciliation function felt that it was possible to settle the dispute it would clearly be sensible to allow the necessary extra time. In this situation, the Commission would doubtless expect assurances of sensible behaviour on both sides and particularly so that work would proceed.

The Bill does not place any obligation on the Commission to act in a particular way. As I have said, the Commission's function will be largely one of conciliation, lt could be that the Commission is so well informed of the circumstances it can draw conclusion that there is nothing useful it can do. In some circumstances, it could bc thai the situation would justify the exercise of an arbitral function. To this third condition there is a proviso. It is that the period of 14 days shall not apply if the applicant for the injuction is able to satisfy the Industrial Court that the breach or nonobservance is likely to occur within the next 10 days. This proviso is another aspect of what I said a moment ago, that what we are trying to do is to provide for reasonable people behaving responsibly. If a union has no intention of giving any opportunity for conciliation, whether outside, or with the assistance of, the Commission, then the employer against whom the threat is made should not be deprived of his remedy.

Honorable senators will notice that the Bill places no compulsion on a party to notify the Conciliation and Arbitration Commission at all. If the party does not, then of course he cannot secure an injunction against the threatened breach or nonobservance of the award. When in fact there is breach or a mandamus to observe the award. Where an application is made for a mandamus, because of a breach, and an injunction is sought simultaneously because breaches of the same or a similar kind are apprehended, the provisions I have referred to will not apply.

In keeping with the philosophy underlying this Bill, a party taking action under section 109 without notifying the Commission of a threatened breach or non-observance of an award will not be entitled to his costs. This will be covered by regulation under provisions included in the Bill relating to the making of regulations as to costs. It will be an incentive to notify the Commission of any threatened breach. While on the subject of costs - and clauses 8 and 14 are relevant - it is proposed, when the regulations are being made, to provide first, that in order that a party should be encouraged to make the maximum use of the processes of conciliation as envisaged by this Bill, no cost will be allowed where action is taken under section 109 in respect of a threatened breach and the breach does not take place. Secondly, it is proposed that costs of representation in relation to proceedings under sections 109 and 111 will be limited to junior counsel unless the Industrial Court considers that issues of such a nature are involved that the use of senior counsel is justified. These proposals as to costs should be seen as an integral part of our approach to the whole problem. If matters get to the contempt stage then clearly the party in contempt should carry the full responsibility. Our proposals limiting costs to those of junior counsel except where special cirstances exist are based on our study of past practice. They will remove any justification for the argument that costs of sanctions proceedings have been deliberately inflated by use of senior counsel. It may be said that the provisions of the Bill do no more than lay down the sort of practice that is followed by those employers and unions who now behave responsibly. Our objective is that this legislation will provide the opportunity for all employers and all unions to behave more responsibly.

The Bill seeks to remove obstacles, either real or imaginary, in the way of the Act's functioning in accordance with its expressed objectives contained in section 2 of the Act. It will expand the opportunities for those genuinely interested in the conduct of industrial relations to pursue and protect their interests in a spirit of responsibility. No comfort will be found in this Bill by those in the industrial relations area who advocate or resort to direct action for the achievement of their claims.

I have now dealt with the principal provisions of the Bill, that is to say, the provisions that appear in clauses 6, 8 and 14. The Bill also tidies up certain provisions of the legislation and deals with some procedural problems. I need only refer to some of these. Clause 3 and clauses 9 to 12 deal with the Inspectorate under the

Conciliation and Arbitration Act and facilitate the recovery of sums due under awards. We have inspectors who are officers of the Department of Labour and National Service and arrangements have been made with some of the States under which State labour inspectors perform inspection functions under our legislation. The Bill would enable the Minister for Labour and National Service to authorise officers of the Public Service of the Commonwealth other than of his Department to perform the duties of an inspector under the Act. There may be situations, for example, in the Northern Territory where it would be much more convenient to use officers of the Department of Territories as inspectors rather than have officers of the Department of Labour and National Service stationed there. This would, of course, involve agreement with the Minister concerned.

The Act as it now stands prevents inspectors taking action in respect of a breach of an award, including recovery of wages, if proceedings are not commenced within six months of the breach of an award. In complicated cases this is sometimes too short a period to allow inspectors to complete their investigations. So the amendment made by clause 9 will permit proceedings to be commenced at any time within twelve months after the commission of the breach.

The second provision to which I want to refer is found in clause 4. Under section 44a of the Act the President may, in the circumstances there described, constitute a joint session of the Commission where benches differently constituted have before them common matters for consideration. In short, as section 44a now stands, the President may, for example where one bench has been constituted to deal with a reference under section 34 and another bench to deal with an appeal under section 35, direct that there be a joint session of both benches to take evidence and hear argument that is common to both cases. The present provision does not authorise a joint session where matters under section 33, such as the basic wage, are concurrently before the Commission with references or appeals.

Honorable senators will remember that in 1964 the President found a device for meeting this problem. In 1964 the basic wage bench was composed of four presiden tial members and the total wage bench df the same four presidential members and a lay commissioner. The lay commissioner sat in as an observer to hear argument that was common to both cases. This device met the circumstances; it was, however, contrived. The Bill's provisions will enable this type of case to be dealt with without resort to such an artifice. They will permit the President to constitute a joint session whenever there are matters common to different proceedings before different elements of the Commission and the President considers a joint session would facilitate the hearing and deliberations of these matters. This provision will facilitate the Commission's work and should be welcomed not only on this account but also in saving the parties having to present the same case twice. I commend the Bill to the Senate.

Debate (on motion by Senator McKenna) adjourned.







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