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Tuesday, 22 May 1928


Mr GREGORY (Swan) .- I suppose that no honorable member has had a more extensive experience of our arbitration laws than the right honorable member for North Sydney (Mr. Hughes), who, in the course of an exhaustive speech last week, indicated that his conclusion, so far as I could judge from his remarks, was that this bill, if passed, would merely be a continuation of the patchwork legislation that has been enacted since 1904. The right honorable gentleman said that we were sinking more deeply into the bog, and, although he claimed to be an advocate of arbitration, he was unable to give any assurance that this proposal would bring about that peace in industry which it was anticipated would result from it. Probably no act on the Commonwealth statute-book has proved so impotent, and so full of intricate and mischievous conditions that have led to illfeeling and strife between employer and employee, as has the Conciliation aud Arbitration Act. I listened with great attention to the speeches of the right honorable member for North Sydney., the honorable member for. Newcastle (Mr. Watkins), and other honorable members. They were all of the opinion that the principle we have adopted is wrong, and that a court with representatives of the two sides should confer and decide the conditions under which industries should be conducted. That would avoid the absurdity of having those conditions determined by an authority, probably a person with a legal training, who was not familiar with industrial matters.


Mr Lacey - What would happen if a conference such as the honorable member suggests failed to come to an agreement? "Would not- arbitration then be necessary ?


Mr GREGORY - I have recently been examining the Canadian system, and I believe it is preferable to that which operates in the Commonwealth. It is simple and concise. When a dispute takes place, or if the Minister considers that a dispute is likely to occur, he immediately issues instructions that a committee representative of employers and employees be appointed. This body is asked to appoint a chairman; but if it fails to do so the Minister appoints one. If, upon an investigation of the dispute, an agreement is arranged with the parties, this is recorded and has the force of law. Should no agreement be arrived at, a report of the proceedings and opinions of the committee is published in the newspapers, and the public has full cognizance of the facts of the case. Then the parties may do as they like ; but the side that is not sup-' ported by public opinion cannot maintain for any length of time the stand that it takes. A long experience of its working shows it to be far preferable to our industrial law.

Some honorable members have expressed their emphatic belief in local boards or something akin to the wagesboard system. I presume that they suggest that that system would be preferable to the determination of disputes by a judge in arbitration. I am convinced that disputes can best be settled by means of round-table conferences between employers and employees, whether the decisions have the force of law or not. The members of such a body would be familiar with every detail of the disputes, and would understand the difficulties of each side. If representatives of the parties to industry are prepared to meet in an amicable spirit, there is a chance of arriving at a working agreement. Have we had anything in the nature of industrial peace as a result of the awards of the Arbitration Court? Most decidedly not.


Mr Stewart - This bill provides for something such as the honorable member suggests.


Mr GREGORY - It was described by the right honorable member for North Sydney as a patch-work measure, and the speech of the Attorney-General himself (Mr. Latham) showed that he had very little confidence in it. The present act was of little avail in regard to the marine cooks. Why is, not action taken today by those who control the court ? Why are a few persons, who declare that they will not work, permitted to strangle industry owing to a false sense of loyalty on the part of other organizations?


Mr Latham - What would the honorable member do?


Mr GREGORY - I would not put a clause into this bill providing for the taking of a ballot. So far as I can £udge - I may be doing the Minister a wrong - that clause is ostensibly for the purpose of having a ballot taken in connexion with a dispute.


Mr Latham - That hardly answers my question.


Mr GREGORY - Take the position as we find it. I ask the Attorney-General himself why we have this great hold-up of industry by a few men.


Mr Cook - Because we have not the power to deal with it.


Mr Blakeley - The Government may provide for a secret ballot; but they cannot compel unionists to vote. The men would refuse to take part in a secret ballot conducted by the Government.


Mr GREGORY - The object of the clause is to enable a judge to order a ballot if a serious dispute or strike occurs. Are we to legalize strikes? The penalties, provided since the first Commonwealth Arbitration Act was brought into operation in 1904 have never been enforced. Is it fair that we should have a law under which one section is handcuffed and shackled and another allowed to do as it pleases? That is the position to-day. The Leader of the Opposition (Mr. Scullin) said that this is a coercive measure; but what has been the nature of all our arbitration bills since compulsory arbitration was first introduced. They have been of a coercive nature - but coercive in respect of only one section of the community, the employers. Do honorable members favour a law under which one section is compelled to abide by the decision of the court and another is allowed to do as it pleases?


Mr Watkins - That is not correct.


Mr GREGORY - That has been the effect of our arbitration system up to the present. Realizing the impossibility of drastic amendment at the present juncture, I intend to support the second reading of this measure, although I believe that some of its provisions should be amended. I refer more particularly to the removal of governmental activities, such as our railways, from the control of the Commonwealth Arbitration Court. Honorable members opposite have said that this measure has been introduced with the intention of destroying trade unionism in Australia; but I do not believe there is a member of this Parliament who would dare or who would care to attempt to destroy trade unionism. We all know the value that trade unionism has been to the workers, not only in Australia, but throughout the world. We know how some employers in days gone by oppressed their employees, and how essential it was that the workers should organize for their own protection. Laws passed by this and other Parliaments have legalized trade unionism. It would be madness and wholly unjust to attempt to destroy trade unionism, the value of which I am sure every one appreciates. But trade unions have developed into political organizations.


Mr Makin - That is the trouble, I suppose ?


Mr GREGORY - Years ago trades unions were more in the nature of friendly societies.


Mr Blakeley - Respectable debating clubs.


Mr GREGORY - They were ' useful organizations rendering assistance to men who were out of work and providing benefits in other directions. What benefits do they provide to-day? They are political agencies, and that is where the danger point arises. Trade union leaders do not represent the opinions of the workers, and the present system is not good for Australia or its people. The heavy levies made upon members of trade unions are spent, not in assisting the workers, but upon political propaganda. There is something in the nature of a bolshevik element at the head of industrial organizations in New South Wales, and members of trade unions in that and other States, in their loyalty to their organizations, are compelled in many instances to disregard the awards of the court and so to break the law of the Commonwealth. This is often done in consequence of a decision of a very fewpersons, supposed to represent the men. They do not see that they are being led into slavery by forces more unscrupulous and tyrannical than mankind has hitherto known.

Compulsory arbitration was introduced in Australia with the intention of removing industrial strife. Every one was desirous of some method by which we could avert a repetition of some of the terrible industrial crises which occurred previous to the introduction of industrial legislation, and to avoid the misery and destitution which follow strikes. Many, although sceptical concerning the advantages likely to flow from compulsory arbitration, determined to give it a trial. In New South Wales Mr. Wise introduced an arbitration bill, and encomiums were bestowed on him for the splendid legislation which was then placed on the statute-book. But it did not bring about industrial peace. The late Mr. Seddon also introduced into the New Zealand Parliament an arbitration bill which became the law, and it must be said for the New Zealand Government that it endeavoured in every instance to enforce that law. In introducing the first Commonwealth Arbitration Bill in the Federal Parliament in 1904 the late Mr. Deakin said -

It should prove the first and supreme power in the working of this and similar acts, by its own force guiding and elevating the necessary legal sanctions, fending to suppress industrial war, industrial destruction, industrial anarchy. By its own developed intelligence, its conscience, its judgment, and its humanity, it can combine employers and employees together with those who stand outside the ranks of both in consciously fulfilling the duties arising out of modern and industrial evolution.

What has happened since 1904? Is not there industrial anarchy and animosity in our midst to-day? The right honorable member for North Sydney (Mr. Hughes), when Attorney-General in a Labour administration in 1910, said -

We say that neither employer or employee has any right for one moment to disturb that orderly conduct of the ordinary conditions of our civil and industrial life which is so essential in any civilized community.

In other words, he said that strikes are illegal.


Mr Makin - Who said that they are legal ?


Mr GREGORY - We expect industrial peace, such as Mr. Hughes expected at the time of which I am speaking. When an award of the court is made it should be observed by both parties.


Mr Makin - No one is disputing the point which the honorable member is making.


Mr GREGORY - Statements we have heard from some honorable members opposite are to the effect that there are occasions when strikes are justified.

I had great . faith in the first Arbitration Act as passed in Western Australia, but when the hearing of the first case under it terminated both sides were of the opinion that the judge had no knowledge of the industry into which he was inquiring, and that the case was decided in favour of those who could swear the hardest. The workers then formed themselves into strong organizations, engaged secretaries, and collected evidence in readiness for the next case which was to be submitted to the court. Employers adopted similar tactics, and this course has since been followed by both parties, with the result that we now have two armed camps arrainged against each other in bitter conflict. This is due largely to the system of compulsory arbitration under which we are working.

State courts are able to handle disputes within a State, but for some time past industrial organizations have endeavoured to make disputes extend beyond the limits of one State so that they can. be heard before the Commonwealth Arbitration Court. This involves the expenditure of considerable sums of money in paying the costs of officials and witnesses, who have to travel long distances in order to appear before the Commonwealth Arbitration Court. The expenditure so incurred in connexion with the harvester and wharf labourers' cases amounted probably to tens of thousands of pounds. It would be impossible to determine the amount actually lost in consequence of strikes, and what their effect has been upon the people of Australia. Compulsion, which is the essence of the bill is, I think, wrong. In Australia there is no governing class such as there is in older countries. We pride ourselves on our democracy, and wish to give every one who has the brains, energy, and ability the opportunity to progress and partake of the benefits which a country with such boundless resources provides. Compulsory arbitration, by making the worker a docile and sometimes unwilling unit in a great organization, strikes at the root of that laudable ambition.


Mr Makin - Is it not correct to say that the minimum wage fixed by the court becomes the maximum wage?


Mr GREGORY - The present system prevents a man working to his full capacity.


Mr Makin - That is not an answer to my question.


Mr GREGORY - Too often the minimum, becomes the maximum.


Mr Makin - Always.


Mr GREGORY - The evil exists, and the position is. exactly as I stated it. An industrious workman who is doing more than his mate is compelled to slow down.


Mr Makin - Is it not open for his employer to pay him more?


Mr GREGORY - Surely the honorable member for Hindmarsh is conversant with the butty-gang system in operation in the Victorian railway workshops, under which men were paid additional money for doing extra work. The honorable member should know of the protests made by certain unionists, and that the railways unions in Australia are strongly opposed to the butty-gang system, under which men are paid by results. If the honorable member is not aware of it he ought to be. Members of unions in many cases refrain from doing a full day's work because of the trouble which would arise, and it is a great pity that the invitation by the Prime Minister for a conference was not accepted by the unions.

There can be no value in an award which can be repudiated by either section. I believe that the idea underlying the insertion in the bill of the clause which provides for the taking of a secret ballot is to give the people an opportunity to judge whether a majority of the employees are in favour of or opposed to a strike. The arbitration system is entirely different from that of wages boards. The following figures reflect the industrial conditions that existed between 1913 and 1921 in New South Wales under the arbitration system, and in Victoria under the wages board system: -

Those figures show that the awards made under the wages board system were infinitely more satisfactory than those made under the arbitration system.


Mr Cook - If the Commonwealth had been given the necssary power at the last referendum, it could have made provision for the appointment of wages boards.


Mr GREGORY - The electors told the Commonwealth Government, in no uncertain manner, that they did not want it to interfere in industrial matters, which properly were the functions of the States. It should be the aim of honorable members to live up to the literal meaning of the Constitution and not to try to dodge it in our legislation at every possible opportunity. I feel warmly on this subject. The electors told the Government so emphatically that it should mind its own business that I was prepared to see it provide in this bill for the exclusion of big State activities like the railways from the Commonwealth Arbitration Court. It was never intended that the Constitution should give to this Parliament the power to delegate to a judge the duty of inquiring into the wages and working conditions of the employees on the State railway systems; in other words, to obtain financial control of the railways.


Mr Latham - The Commonwealth Parliament not many years ago expressly legislated to include railway employees within the scope of the Commonwealth Arbitration Act.


Mr GREGORY - That action was taken by the 1910 Labour administration, following upon a decision of the High Court with which the Attorney-General is familiar. The Labour party of the day readily grasped the opportunity which was then presented to it. I do not regard as sacrosanct any legislation passed, by a previous Parliament. Surely, if a majority of honorable members do not agree with it we should repeal it as speedily as possible. I propose to give honorable members an opportunity to repeal that provision when the bill is in committee. They will then show by their votes whether they believe that the Parliaments of the States or the Commonwealth Arbitration Court should have control of the administration of the State railway systems.


Mr Bell - Why railways particularly?


Mr GREGORY - Because they are the most important of the State activities.


Mr Bell - Would the honorable member exclude all State instrumentalities from this legislation?


Mr GREGORY - The honorable member should ask his questions at question time. Probably, he does not feel deeply upon this intrusion of the Commonwealth in the realms of the State, because Tasmania has not so far been affected. I have the greatest respect for Sir John Quick, whom I have known for the last 40 or 50 years; but T have no respect for a Parliament or a government which will authorize a Federal judge, or any other legal gentleman, to fix the working conditions and the wages of employees in such an intricate establishment as the railway systems of Australia. Nothing but chaos can result. Such a policy is both nonsensical and absurd.


Mr Makin - Who is to fix the wages? Is it not fair to leave the determination of that' matter to an impartial tribunal ?


Mr GREGORY - The wages and conditions of the railway men in Victoria were formerly determined by what was considered an impartial board.

Let us consider the effect of the Commonwealth Arbitration. Act upon the three principal industries - shipping, wharf labouring, and coal-mining. Has there not always been chaos in those industries? Hardly a week passes without some trouble occurring in one or the other; yet no government has had the courage to step in and say, " This sort of thing cannot be tolerated." Between 1913 and 1921 the number of disputes under Commonwealth awards was 3,791. The workers involved totalled 1,081,000, and their losses in wages amounted to £11,000,000. I ask honorable members to imagine what could be done with that £11,000,000 if those men had been continuously in peaceful employment. A bolshevik element has apparently obtained control of many industrial organizations, and is constantly endeavouring to promote strife and antagonism between employers and employees. I invite honorable members to read a statement by Mr. Garden, which appears in to-day's newspapers. Between 1912 and 1926 the loss in wages alone on account of industrial disputes in Australia amounted to no less than £16,000,000. That is sufficient to pay the interest bill on a debt of over £300,000,000; yet it falls far short of the total amount which was lost to Australia. To-day there is a big strike in the shipping industry. The shipping companies are losing heavily, and they will have to recoup their losses when their vessels resume running. Thus the workers and the producers will have to foot the bill. That will follow as surely as night follows day. There can be no question as to the suffering and hardship that is caused to those who are unemployed. In 1923 the enginedrivers in the coal-mining industry, who comprise only a small section, went out on strike, and caused the loss of millions of pounds. Only last December we witnessed the spectacle of honorable members urging the Government to intervene in another dispute; in other words, to supersede the court of which they are so proud. Now, a very small proportion of the men engaged in the shipping industry have caused the tying-up of a large number of ships, with the result that thousands of men have been thrown out of employment, and trade and. commerce is, suffering huge losses. Can the AttorneyGeneral assure me that this bill contains any provision that will remedy such a state of affairs? I should be very pleased to lend my support to any scheme which would compel obedience to an award by both parties to it.

The pastoralists, the manufacturers, and other sections of the community have a pitiful tale to tell regarding the lamentable conditions that exist throughout Australia. The manufacturers claim they can continue operations only if they are given ever-increasing customs protection. When customs duties are increased, the cost of living rises, and the working man feels the pinch. Probably the honorable member for Hindmarsh (Mr. Makin) does not care if the working man has to pay an extra 3d. or 6d. a pound for his butter?


Mr Makin - That is a very cheap gibe, which is unworthy of the honorable member.


Mr GREGORY - The honorable member ought to be ashamed to support such a policy. I know that my remarks do not fall pleasantly on the ear of either the Government or the Opposition, but that will not deter me. I want honorable members to realize the position into which we are drifting. Recently a paragraph appeared in a newspaper to the effect that the captain of the Cornish steamer Tremeadow had stated that it was cheaper to take his vessel away from Australia in ballast than to load it with wheat in this country. The agents assert that for several years they have been urging the Government and harbour authorities in Australia to recognize that the existing charges are a factor in crippling the growers of wheat and other produce. Then there was the case of a steamer which was damaged by fire at Port Adelaide, and was towed to Holland to have repairs carried out there because it paid the owners better than to have the work done in Australia. Unemployment is the inevitable effect of industrial disputes. On account of our economic conditions an important mine like the Mount Morgan mine, which still has £15,000,000 worth of ore lying latent, had to be closed down, causing a couple of thousand men to be thrown out of employment directly, and at least an additional 10,000 indirectly.

Every man who engages in primary production carries five persons, if not more, upon his back. "We cannot throw a couple of thousand men out of employment without affecting industry throughout Australia. The supreme test of the value of any legislation is whether it assists to make the country more prosperous and the people happier and contented. It should be the aim of this Parliament to make the people prosperous and contented. Has the arbitration law ever brought about peace, contentment, or prosperity ?


Mr Makin - Of course it has.


Mr GREGORY - Not to the worker.


Mr Makin - Yes.


Mr GREGORY - The Leader of the Opposition (Mr. Scullin) has admitted that the effective wage to-day is 5 per cent, less than it was in 1911.


Mr Makin - The working man has not gained in wages, but he has in the conditions of his labour.


Mr Yates - It is the profiteers that raise the prices. Ever since the war wages have been chasing prices.


Mr GREGORY - The economic conditions that the honorable member has assisted to bring about enable the profiteer to carry on. Has there been any contentment under our arbitration law? That should be the supreme test of anyi act that we pass. I assert that the Arbitration Act has not made the people either contented or prosperous. On the contrary it has undoubtedly created antagonism. Members of the Scottish delegation who visited Australia some time ago said that in no country had they observed such antagonism existing between employers and employees as in Australia. Honorable members opposite know that there is a section in the community which is doing its utmost to breed antagonism and strife in industry and disloyalty in the community generally.

In again voicing my opposition to the encroachment by the Commonwealth on the sphere of the States I remind the House of what the late Mr. Alfred Deakin said when introducing the Conciliation and Arbitration Bill in 1904: -

It was because I thought, looking at this question as a lawyer, that it was not competent for us to include the public servants of a, State within the provisions of this measure, as well as because I deemed it most impolitic, that I raised my objection to the proposal directly it. was drafted. . . . Although it may seem at first a matter of comparatively theoretical moment, yet it is the preservation of that poise and balance between the centrifugal and centripetal tendencies which makes the true federalist at one time the antagonist of State aggression, at another time the antagonist of the undue aggrandisement of the central Government.

Among a certain section of the community there is a great desire that the Commonwealth shall enroach on spheres which have always belonged to the States. I hold strong views in this matter. As one who has had a long experience as a Minister in a State Parliament, I know the difficulties which confront State Treasurers in preparing their estimates. They have either to reduce expenditure or impose fresh taxation if they would make their revenue meet their expenditure. Honorable members from South Australia know that because the Railways Commissioners of that State were unable to meet the awards made by Sir John Quick thousands of men have been dismissed from the railway service of that State.


Mr Makin - Their dismissal was part of the policy of the Nationalist Government.


Mr GREGORY - When the Constitution was framed it was never intended that judges should fix the conditions of labour on State railways. I resent the continual attempts on the part of the Commonwealth to encroach on the spheres of the States without the consent of the States. Only two members of this chamber and one in another place - I refer to the honorable member for Wannon (Mr. Rodgers) and myself in this House, and Sir Henry Barwell in the Senate - rightly gauged the pulse of the people regarding the proposals submitted to them at the last referendum.


Mr Yates - What nonsense!


Mr GREGORY - Of the members of both Houses only the three I have mentioned advocated the claims of the States. While I do not claim that this bill still further encroaches on the rights of the States, I anticipated that the Government would have withdrawn many industries from the scope of Commonwealth legislation. Instead of this legislation, being limited to industries over which the

Commonwealth should have control, it applies to numerous small and comparatively insignificant industries. Persons employed as aerated water carters, agricultural implement makers, bedstead makers, brewers, builders' labourers, candlemakers, carpenters, and a number of others are covered by it. Apparently it is thought that if an industry in New South Wales gains the benefit of a Piddington award, similar conditions should apply throughout Australia. For representatives of employers and employees in Western Australia to attend before the Commonwealth Arbitration Court in Melbourne would cause considerable trouble and expense. I am satisfied that the majority of the people of that State prefer the system at present in operation there - a judge acting with two assessors - to the system of arbitration dealt with in this bill. Only recently an award of the Commonwealth Arbitration Court caused chaos in the clothing industry 5 businesses which previously were in a flourishing condition now find difficulty in carrying on. Probably they will seek relief by applying for higher duties. I should not object to the Federal Arbitration Court dealing with industries such as shipping and shearing, but not with coal mining, for conditions in that industry could scarcely be worse than they now are. Every appeal to the court by the coalminers results in their gaining some slight advantage, with the result that the mineowners seek a little more for themselves.


Mr Makin - The honorable member is on the right lines when he condemns the mine-owners.


Mr GREGORY - The honorable member for Hindmarsh (Mr. Makin) knows how industries in South Australia are suffering because of the high price of coal. It must be exceedingly difficult to carry on any manufacturing at all in that State.


Mr E RILEY (SOUTH SYDNEY, NEW SOUTH WALES) - Cheer up!


Mr GREGORY - The honorable member himself should cheer up. Many of his friends must now be feeling the pinch because of the dislocation of industry.


Mr Blakeley - For twelve years the honorable member for Swan (Mr. Gregory) has been painting doleful pictures.


Mr GREGORY - I do not admit that the picture is doleful. Surely I am entitled to protest against the introduction of legislation with which I do not agree. I believe in liberty.


Mr Makin - Then vote against this bill.


Mr GREGORY - I believe it is a great mistake for Parliament to take away the liberty of the people by interfering with industry. That such interference is inimical to the best interests of the community is patent to many people.


Mr Makin - Yet the honorable member will support the bill.


Mr GREGORY - I believe that this bill is an improvement on past legislation. I see in it no mention of the increased fines of which honorable members opposite have spoken.


Mr Blakeley - There are eight new penalties up to £100 each.


Mr GREGORY - Were there not penalties of £1,000 in previous legislation ?


Mr Blakeley - I am speaking of new fines.


Mr GREGORY - There should be power for the Commonwealth to say to a few men who are holding up a big industry, as to-day the shipping industry is held up, that if they will not obey the law they must leave the country. That was the law in ancient Greece. It is the duty of Parliament to see that its laws are observed by every section of the community, whether rich or poor, and irrespective of how strongly organized it may be. A wrong law should be repealed; but while it remains on the statute-book it should be enforced. To allow any section of the community to defy the law is to breed incipient revolution. In committee I propose to move that State activities be removed from the scope of the bill, and would prefer, if compulsory arbitration is to be continued, its control to be limited to a few specified industries leaving to the States the full control of all other industries. Failing this I will support the bill.







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