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Tuesday, 8 May 1973
Page: 1769


Mr WILLIS (Gellibrand) - This important Bill has 2 key facets for the Government and the trade union movement. I refer first to the aim of simpler amalgamation of unions and second to the provisions of the Bill dealing with the abolition of the penal sections of the Conciliation and Arbitration Act. That amalgamation of unions is to be made earlier will be of great benefit not only to trade unions but also to society generally. It is certainly important to the trade unions because, by being able to amalgamate into larger union bodies, they can operate much more efficiently and effectively than as a group of small unions. This comes about in many ways. Where unions have amalgamated it has been notable that they have established research facilities. Such facilities have been appallingly absent in the trade union move ment until the last decade or so. Amalgamation has enabled unions to establish effective research sections which, in turn have enabled them to operate much more effectively for their members. I do not wish to list all the advantages gained by unions through amalgamation, but it is clear that the greater size of union bodies makes them more efficient in their operations.

Society as a whole also has a vested interest in larger unions because of the obvious likelihood of reductions in the numbers of demarcation disputes. Demarcation disputes have aptly been described as the cancer of the trade union movement. Certainly it is desirable that everything possible be done to eliminate them and the best way to eliminate them is to have larger trade union bodies. The aim of the Australian Council of Trade Unions is to establish industrial unions. Where industrial unions have been established in other countries there has been a marked reduction in demarcation disputes. In that respect 1 refer to the October 1972 edition of the 'Australian Director'. Is contains an article by Dr Buttner, Director of the West German Productivity Organisation. The article is entitled: 'Higher Productivity - The West German Experience'. The author explains that in West Germany one of the reasons for the tremendously high productivity there is the small number of unions. At page 67 of the publication Dr Buttner writes:

There are 16 industrial unions who organise 7 million workers on the principle of one plant - one union only, so demarcation disputes which are frequent in England for instance are completely unknown in Germany.

By enabling simpler amalgamation of unions this measure will help in the establishment of industrial unionism. This will certainly bring about benefits for industry generally and a reduction in the number of disputes. An even more important function nf this Bill is the removal from the principal Act of the penal and sanction provisions. The main targets in this respect are the provisions relating to contempt of court. These provisions have been tremendously important to the trade union movement in this country. They have involved a mammoth payout of funds, particularly in the period from the mid-1950s to the late 1960s, until they became virtually inoperative in mid- 1969.

I wish to cite some figures relating to the period from 1957 to 1968. In that period the greatest number of contempt of court proceedings were instituted in the history of the Act. In that period 788 fines totalling $280,210 were imposed on trade unions. The costs associated with these proceedings generally work out to be roughly the same as the amount of the fines. Using that rough procedure this means that from 1957 to 1968 the trade union movement was fined by the Commonwealth Industrial Court, in contempt of court proceedings, well over $500,000. This is a tremendous sum. Certainly it is one which caused a tremendous reaction within the trade union movement. Of course, it is obvious that once enormous sums like this are imposed on trade unions there must come about not the settlement of industrial disputes but the exacerbation of industrial disputation. That is what happened, climaxing in the events of May 1969, after which the sanctions clauses became inoperative.

One can use various arguments against the contempt of court proceedings. I shall go through a few of them. The first is the obvious one which I have mentioned, that is, the sheer counterproductive nature of such penalties. They exacerbate industrial disputes; they do not settle them. If we keep fining unions heavily we do not settle industrial disputes. We do not establish greater rapport between unions and employers; we just divide them into warring parties. This is certainly no way in which to bring about a better industrial environment. Secondly, fines have been imposed where the Commonwealth Conciliation and Arbitration Commission has refused to arbitrate. This is totally objectionable. An example of this is the General MotorsHolden's Pty Ltd case in 1964. This was a very big dispute which was brought about largely by the enormous profitability of GMH, which was making annually many times the total amount of funds which had been invested in the company by the parent organisation. In 1964 a big dispute developed and the unions went on strike for the best part of a month for a S6 increase in pay. As a result of that strike the unions were fined $19,000, and when they finally agreed to go to arbitration there were potential fines of some $30,000 hanging over their heads.

The case went to arbitration. It took almost 2 years to settle. When the decision was finally given in 1966 the Commission said that it did not arbitrate in cases of that nature and that it was not there to settle industrial disputes relating to over-award claims for one company. It said that it settled industrial disputes on an industry basis, providing the same rates for all people in the industry, and that it was not there to deal with industrial disputes relating to over-award payments within one company. Nevertheless, the unions had been fined $19,000. That amount was doubled with costs so that altogether the penalties approached $40,000. The dispute related to a matter on which the arbitration system was certainly entitled to adjudicate but on which it was not prepared to adjudicate. It is totally objectionable to the trade union movement that this sort of thing can happen. Of course, this is what happens. Over-award payments disputes often lead or in the past have led to industrial court proceedings. Often they have been against a particular company and they have been nonarbitral. But despite this fact the Industrial Court has imposed heavy fines on unions. This is a totally objectionable procedure and obviously one which favours the employers rather than the trade union movement.

Thirdly, fines have been imposed where the Commission wanted to arbitrate but the employers denied that right to the Commission. Nevertheless the employers were prepared to use the Industrial Court to impose fines. A good example of this kind of dispute was the tramways dispute in 1965. This dispute built up over some time and it involved one-man buses. It involved the Melbourne and Metropolitan Tramways Board which tried to introduce one-man buses on certain routes in Melbourne and refused to negotiate with the unions about the matter. The unions asked the Commission to put in the award a clause which would require the Melbourne and Metropolitan Tramways Board to negotiate with the unions on this matter. The Tramways Board went to the High Court 4 times to try to stop the Commissioner inserting such a clause in the award because it said that this was a management prerogative and that the unions just had to cop it. While the Tramways Board, by going to the High Court, was frustrating the desire of the Commissioner in his attempts to settle this dispute the union was involved in a number of stoppages over the issue in protest against the action of the Tramways Board. They were taken to the Industrial Court by the Melbourne and Metropolitan Tramways Board and fined $7,200, again plus costs. So the penalty imposed, in a matter in which the

Tramways Board was saying that the Commission did not have the right to arbitrate, was about $15,000. But while the Tramways Board claimed in the Arbitration Commission that the Commission did not have a right to arbitrate in the matter it was quite prepared to have fines imposed by the industrial court on the union in respect of this same dispute - again a totally objectionable procedure.

There is a fourth reason, which is a general conceptual one and which has certainly been used by the trade unions and members of the Labor Party in the past to justify arguments for the abolition of the contempt of court procedures. This is the general conceptual point that whilst the trade unions are obliged to accept decisions of the Arbitration Commission and the employers must pay the rates awarded by the Commission the employers can, in effect, evade their obligations in this regard by raising their prices. It is certainly true that so long as employers can raise their prices following an arbitrator's decision on wages they are effectively evading their responsibilities under that decision by reducing the real wages of the employees which is what really matters.

It is hypocritical for employers and members of the Opposition to say that unions have an obligation to accept decisions of the Commissioner relating to wages when employers are free to raise their prices. I must admit that this fourth factor, to which I am now alluding may, in fact, have to be modified slightly depending on the effectiveness of the proposed prices justification tribunal. But certainly it is true that so long as employers can use a wage increase granted by an arbitrator as a basis for justifying increases in prices, there is no justification for having penal clauses in the Conciliation and Arbitration Act to punish striking unions.

The Deputy Leader of the Opposition (Mr Lynch) said that other countries have sanctions applying to unions. The only country which has an industrial system similar to Australia's is New Zealand. According to the Deputy Leader of the Opposition this morning sanctions remain in use in New Zealand. I do not know quite what he meant by that statement. To my knowledge those sanctions have hardly ever been used in New Zealand. Certainly they remain in the legislation, but they have practically never been used. There was an amendment to the New Zealand act in 1962 to enable employers to initiate proceedings to invoke sanctions. Previously only the Government could take this action. Only twice between 1962 and 1968 was any action taken by employers in New Zealand in regard to sanctions.

In 1968 the secretary of the New Zealand Department of Labour, Mr Woods, produced a report on industrial legislation. In this report he set out a number of reasons why penal legislation to deal with strikes is impossible to enforce. I will just give a summary of those reasons. The first one was that international trade unionism holds firmly to the right to strike as a fundamental human freedom. The second was that there was no means of making people work if they stand firm on a refusal to work. The third was that it is unlikely for workers to inflict loss of earnings on themselves and their families without feeling that they have good reasons for the action they are taking. Fourthly, penalties against strikers cannot be enforced because the objective of industrial relations is to maintain, and, in the case of a breakdown, restore relations. Penalties merely inflame the situation. Fifthly, since in most cases of strike action both parties are to blame, the fact that only workers are penalised causes permanent alienation of the work force.

Sixthly, if workers have won their claim the infliction of a penalty appears absurd; if workers lose, their grievance is compounded. Seventhly, where workers concertedly refuse to pay fines, imprisonment is no solution since it removes the work force more effectively from its work place than the strike itself. Eighthly, fining unions instead of workers may destroy unions as effective organisations; yet the existence of strong partners in negotiations is recognised by employers as a prerequisite of successful industrial relations. That is a summary of 8 reasons given in 1968 by the Secretary of the Department of Labour in New Zealand, Mr Woods, as to why the penal clauses in that country are impossible to enforce and should not be enforced. He made it quite clear in that report on industrial relations that it was his opinion that sanctions should not be used in industrial relations contexts.

One other factor to which I have time to refer quickly is the proposed protection of unions from actions for tort. The Minister in his second reading speech has mentioned that this system already operates in Queensland and has operated in the United Kingdom since 1906. I mention only that in 1968 the British Royal Commission into trade unions brought down its report in which it found that the system which had operated from 1906 until 1968 in that regard should continue. lt had been argued by the employers that that should not be the case, that unions should be capable of being sued for actions for tort. The Royal Commission found against that view. So there has been a long and detailed analysis of this matter in that country from 1965 to 1968. It took 3 years for the Royal Commission to make its report and it found that the situation should continue. By means of this Bill we simply are introducing that system which has operated in the United Kingdom since 1906.

I would like to refer very briefly to section 138 of the Act which is known as the incitement to boycott section. This is a quite repugnant section of the Act which involves fines being imposed on individual persons for incitement or encouragement of people to go on strike. This provision has not been used extensively but it was used in the late 1950s and in 1960 in a couple of quite famous cases, the most famous being the Mclvor case which involved a Queensland meat industry union organiser who advised a fellow member of the union to leave a place of employment. He was found guilty under section 138 of the Act of incitement to boycott. He .was fined $20 and ordered to pay $372.44 costs. I might say that eventually he was declared a bankrupt because he did not have the money to pay. When the case went to the High Court it was found that he did not have to pay anyway after being declared a bankrupt. Another case involved a Mr Taylor who was also a meat industry unionist. He was convicted in 1959 of 2 breaches of section 138 of the Act. He was fine $230 and ordered to pay $1,400 costs. He never paid those costs, and I am glad to say that he did not. They have never been collected. Section 138 has been virtually inoperative since 1959-60 when those 2 cases I have mentioned came about. The amendment to remove this quite repugnant section from the Act is certainly worth while. I strongly support the Bill.







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