IR Laws unnecessary or indispensible

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University Degree Law

IR Laws – unnecessary or indispensible?

I        INTRODUCTION

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The relationship between workers and those needing labor services is one of the most important relationships in society, which serves not only an economic function but also a social one as well.   Prior to federation that relationship was largely unregulated, with ‘piecemeal’ legislation enacted to control workers, and to secure wealthy business interests.    Wages and working conditions were almost exclusively negotiated at common law through either individual or collective representation; the work relationship was viewed almost exclusively in economic terms.

The nature and understanding of that relationship has evolved substantially since those earlier times, into one that is now regulated by the State through legislation.   But an argument still persists…that sufficient protection for parties exists at common law, and that regulation unduly interferes with the freedom of individual choice to contract.   This paper will examine whether workplace laws should be deregulated, and if so, why.

II        HISTORICAL REFLECTION ~

WHERE DID WE COME FROM AND WHY ARE WE HERE?

‘If there is to be peace in our industrial life let the employer recognize his obligation to his employees - at least to the degree set forth in existing statutes.’

An appropriate starting point in this analysis lies in the historical origins and motivations for workplace laws; rights that our forebears experienced extreme hardship and adversity in securing.   In this context, the 19th Century was a crucial period in the history of workplace relations, because it represented a revolutionary change in the relationship between workers and employers traditionally founded on a feudal master/servant relationship.

Increasingly workers challenged the inequality and poor working conditions associated with this traditional, subservient relationship, with Australian workers not only having to overcome the feudal perceptions of employment, but also that of a convict worker mindset omnipresent in a new nation transitioning from a convict labor force to that of a free labor force.   In the absence of any other accessible legal protections, workers asserted the voice of social justice through collective unions.

The period witnessed considerable unrest with collective strikes, culminating in the Maritime and Shearer’s Strikes of 1890 and 1891.   The Shearer’s Strike demonstrated how far workplace relations can degenerate when there is no fair statutory framework to establish legally enforceable rights, including the fair arbitration and conciliation of disputes.

During the Shearers’ Strike, a military force with artillery was deployed to Barcaldine for use against the shearers, strikers were tried and jailed, the union was depleted of funds, and workers were forced to ultimately accept terms offered by the pastoralists.   The use of military personnel and police to counter strike action by workers was to be repeated on several occasions throughout the 20th Century.

For many years, unions and strike action remained workers’ only remedy, but practically, the consequences were all too often social injustice, limited advancement

of working conditions, and significant instability through social and industrial unrest.   Workers ultimately sought a political solution as legislators, and the Australian Labor Party was born.

The 20th Century witnessed the increased implementation of state regulation over the employment relationship, initially in the areas of arbitration and conciliation of disputes, and then progressively until virtually all other aspects were encompassed.   Federal legislation now provides for benchmark minimum employment and wage standards for most employees, and protections for employers.

The key lesson from history is that current workplace laws evolved out of necessity, in the interests of economic efficiency and social justice, by providing a fundamental structure to employment relations; something not provided for at common law.

III        ECONOMIC RATIONALISM & FREEDOM TO CONTRACT?

‘Freedom of Contract.   What choice is open to the masses of wage earners.   They must either accept the terms offered or starve.’

In the era of ‘economic rationalism’ Australia faced arguments for a return to individual ‘freedom to contract’, which was reflected in Coalition policy through the implementation of the Work Choices amendments to the Workplace Relations Act.

3.1        Argument for Freedom of Contract.

It is argued that workers and employers, as ‘equal’ bargaining parties, should be ‘free’ to engage in work relations on individually negotiated terms, and that modern workplace laws ‘[p]lays havoc with the classic principles relating to contracts’, which underpin all employment relations, and interferes in mutually agreed, beneficial agreements that consenting individuals enter into – agreements that the state has no place to interfere in.   Such freedom would promote efficient market outcomes, and social prosperity would naturally follow.   The modern worker is contrasted as being completely different to that in existence during the industrial revolution, and laws implemented from issues arising during those periods hold little relevance to the era of globlisation.   This is further supported with the assertion that modern contract law is

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far more flexible and adaptable than in earlier times, with greater protections for workers through remedies under contract law, promissory estoppels and equity.   A cited example of common law ‘protection’ was illustrated in the Harvester case, in which the court held workers should receive a ‘[f]air and reasonable wage’ based on ‘[t]he normal needs of the average employee, regarded as a human being living in a civilized community’.   However, in his judgment Higgins J identified problems associated with ‘[t]he one sided nature of the employer’s valuation’ of wages in an unregulated system, and the need for regulation of minimum standards in the ...

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IR Laws unnecessary or indispensible
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