||Issue No. 147||09 August 2002|
A Call to Action
Interview: Save Our Souls
Unions: Rats With Wings
Bad Boss: If The Boot Fits
History: Political Bower Birds
International: No More Business as Usual
Corporate: The Seven Deadly Sins of Capitalism
Review: Prepare To Bend
Satire: Bush Boosts Sharemarket Confidence: Shares his Cocaine Stash
The Locker Room
Week in Review
Thanks for inviting me to speak to you this evening. It's a timely opportunity because there's no doubt the vehicle industry is at the centre of the industrial relations debate at the moment.
Given recent headlines you could be forgiven for thinking the industry is a basket-case. No matter how small a dispute may be, it's become fashionable for newspaper editors to characterise it as a national crisis. No matter that most disputes are resolved quickly and without any widespread disruption, they tell us the sky will definitely fall next time.
Everyone in this room knows that the media and political hyperbole about the industry is far from the truth.
Sure there are some problems to address, and I'll speak about them, but the fact is that the vehicle industry has transformed itself over the last 2 decades into a major exporter and innovator.
Productivity is at record levels. It grew by 50 per cent in vehicle assembly and 90 per cent in components manufacturing, where many of you work, over the last ten years. The industry employs 55,000 people and exported about $5 billion worth of product last year.
In terms of industrial disputes, the facts show that during the 1990s less than 1/10th of 1% of annual working time was lost due to strikes or lock-outs - that's less than 0.1% of working time lost.
These achievements should rightly be regarded as Australia's biggest manufacturing success story.
And it's fundamentally due to the commitment and cooperation of workers, their unions and their employers, as well as previous commitments of Government. The cooperation between us all stretches back to the Button Car Plan in the early 80s.
What we need now is another ten years of cooperative effort to consolidate investment, production and employment opportunities.
The real discussion at the moment should be about the next important strategic steps - and in particular how we can reconcile the legitimate aspirations of employees for better living standards and job security with the legitimate commercial interests of employers, in an open trading environment.
That is the real debate. It is a debate about the medium and long-term future of the industry. Because decisions we make now will have long-term implications.
But this debate has been obscured by hyperbole about industrial relations, generated chiefly by John Howard and Tony Abbott.
Given how hard we've all worked to get this far, it's enormously disappointing to see the industry turned into a cheap political plaything.
In the recent Pilkington's dispute, John Howard took time out from sightseeing half a world away in Paris to criticise workers in Dandenong. He accused them of targeting the sector in some wild plot to destroy their own jobs and bring down the industry.
Not letting the facts get in the way of a good political beat-up, he blamed all this on the AMWU and its' leader Doug Cameron - a union not even remotely involved in the dispute.
In reality it was a short-lived enterprise bargaining dispute. Despite that, John Howard got away with hyping it up into a newsworthy crisis.
Tony Abbott's contribution is to constantly talk the industry down, creating the impression overseas that the industry is unstable, that there is a class war being waged, that the Government wants the workforce to be sued by their employers rather than a cooperative culture be developed.
Just consider this contribution: "My hope is that chief executives will make industrial relations their principal interest rather than leaving it in the hands of so-called specialists. I mean it's great that we've got specialists, but war is too important to be left to the colonels - the generals need to be involved as well." (22 March 2002. Speech to HR Nicholls Society)
Tony Abbott's out-dated, class war hysteria is a threat to investment and jobs, and is damaging our export potential. If he doesn't change tack he will remain on the extreme fringe of the debate, like those who see themselves as waging the other side of the class war.
Why is the Government talking down the industry and talking up trouble?
Federal Government's Position
What's happening is very dangerous for all of us. Those of us with a commitment and a stake in the industry need to consider very carefully the Government's objectives. I think that the Government is manufacturing a climate of conflict to achieve 2 outcomes.
The first is to convince the Senate to push through industrial legislation cutting back the right of workers to collectively bargain for wages and conditions.
The second agenda is to implement a flat-earth industry policy following the Productivity Commission review - cutting tariffs, reducing the ACIS commitment and forcing down costs.
It's no secret that the Government has threatened the business leadership in the car industry that if they don't support the Government's industrial legislation, they won't get much help with tariffs.
This is crude political blackmail. And if employers think this is the solution to the industry's problems, I'd recommend thinking again. Because it's bad policy that won't work, and you cannot expect unions and their members to passively go along for the ride on the Government's political bandwagon.
The starting point for analysing this issue must be a fair-dinkum assessment of the state of industrial relations in the industry.
I know that employers are frustrated about industrial disputes and their potential impact upon production and export markets.
But when enterprise bargaining disputes interrupt the supply of parts to Toyota, Ford, Holden or Mitsubishi, it's not because workers and their unions are setting out to sabotage the industry.
It's because they are bargaining over their pay and employment conditions. And it's because they are enterprise bargaining in an industry which operates on a just-in-time delivery system - a system which means that small breaks in the production chain can lead to widespread disruption.
Commonsense tells us that when the supply chain breaks down because of a legitimate dispute, restricting the collective bargaining rights of the workforce won't solve the problem. It would just about guarantee more industrial uncertainty and increase the potential for disruption.
Australia's existing restrictions on bargaining are already in breach of a number of international conventions. The new laws proposed by Tony Abbott would add to an embarrassing list of ILO violations.
In violating our obligations, we already find ourselves in the company of nations like Swaziland, Zimbabwe and Chile - a country where industrial laws date back to the Pinochet dictatorship. None of these countries is noted for automotive excellence.
In my opinion, rather than winding back employee bargaining rights, what we need to do is understand the sources of the industrial disputes, put in place mechanisms to resolve them earlier, and think constructively about the interface between enterprise bargaining and the just-in-time system.
Let me start with the source of the disputes. It essentially derives from the deep, structural shift in the economy over the past ten years.
These tensions are not peculiar to the vehicle industry. They exist across all industries.
Over the last 10 years there can be no argument that Australia has experienced a historic combination of economic expansion, low inflation and high productivity.
Our growth has far outstripped the G7, OECD and European averages.
But the positive macro-economic statistics conceal the character of some of the change that's taking place.
The fact is many people and regions aren't sharing in the prosperity, and inequality is widening.
Although 1.6 million jobs were added to the workforce the reality is that for all occupations other than managers and professionals, the net increase in jobs consisted entirely of part-time and casual jobs.
87% of these paid less than $26,000 per year. An incredible 48% paid less than $15,600 per year. Middle income jobs actually declined.
We now have a workforce that is 30% casual and as such has no right to paid sick leave or annual leave, and no job security past the next shift.
Impact Of Change In The Workplace
No wonder workers are nervous and edgy about their prospects.
They've looked on as once-strong companies like Ansett and HIH collapsed overnight - taking the livelihoods and entitlements of thousands of employees with them.
They've seen jobs move off shore.
They've been downsized, contracted out and casualised. Far too many people have lost their entitlements.
It is also evident that in many workplaces, economic prosperity has not produced job satisfaction.
ACTU research consistently shows that the intensification of work has become the hot-button issue in many Australian workplaces.
Reduced staffing, higher workloads, longer working hours, less security, more stress, casual jobs, low pay and intense pressure on the family lives of many workers are touchstone issues.
This is why there are so many disputes over contracting out and labour hire, staffing levels and workloads, employee entitlements, and simply protecting jobs.
This is the backdrop for enterprise bargaining in many industries.
Many of these pressures are washing through the lives of the 55,000 people employed in the vehicle industry. AMWU employee surveys confirm this high stress, low security apprehension.
To address these pressures I support a constructive, well-informed industrial relations debate which seeks to find common ground in resolving the challenges confronting the industry.
That is the only way we are going to create a stable system that supports economic growth, recognises the competitive pressures on business in an open economy, and which meets the legitimate aspirations and concerns of the workforce.
The ACTU Agenda
What does this mean in practice?
Firstly, it's got to mean a dialogue about the issues. We simply have to rise above the political pressures and discuss the future of the industry. The ACTU and the AiG have made a start, and your decision to invite me here this evening is an obvious step in this direction.
Secondly, we have to identify the key issues and provide leadership about them. Employee entitlements, for example, cannot effectively be protected on an enterprise by enterprise basis.
Practical solutions have to continue to be developed at an industry or national level if enterprise level disputes, like Tristar and Walkers, are to be avoided.
Thirdly, it's important to look for commonsense ways of resolving disputes at an early stage, of getting the key people to the table sooner, of using the Industrial Relations Commission creatively.
I can't stress enough that curtailing the bargaining rights of workers with secret ballots and cooling off periods will not work. It will not bring stability, it will entrench resistance to change at a time when we need a creative approach to managing the pressures of the global economy.
Vehicle Industry Consultative Council
The alternative that the ACTU proposes is the establishment of a Vehicle Industry Consultative Council involving the key employer and union representatives. It would be a formal body established under s.133 of the Workplace Relations Act, chaired by a senior Commission member.
The Council should not be a talk-fest. I for one wouldn't bother attending if it was.
It should be a practical forum designed to build trust and stability - to discuss the future and deal with industry issues such as entitlements, training, skills and education. It could also help anticipate industrial problems, identify the underlying issues, and draw on the experience of senior industry people and the Commission to resolve disputes as quickly as possible.
And there'd be no need to change a single word of the law to put this proposal immediately into practice.
We only need to look back at the Pilkington glass dispute to see how this could operate. When negotiations broke down, I appointed a senior ACTU representative to convene discussions between the company and the Australian Workers Union.
Within 48 hours this dispute was resolved on an agreed basis. Wider stand-downs and lost production were avoided. An Industry Consultative Council could easily play this role in future disputes and, in the process, develop an early warning system.
The AMWU in its' submission to the Productivity Commission also canvassed the potential for an industry disputes procedure to be negotiated. The Consultative Council could develop this idea, with the objective of creating a more stable and predictable industrial relations environment.
This approach mightn't fix all disputes, because sometimes the issues are especially tough and fundamental. But it could play a very positive role in building trust and stability.
I also believe we should be working together to present a common view to the Productivity Commission about tariffs and the industry assistance package.
It's obvious that tinkering around with tariffs has more to do with economic theory than common sense. Exchange rate movements can easily swamp the impact on costs and prices of further tariff cuts.
The ACTU has made a submission to the Productivity Commission. We have argued that tariffs should be paused at current levels until 2010 and reviewed in 5 years time. Similarly, ACIS should be maintained in its present form until 2010 and reviewed in 5 years time.
We ought to be lobbying the government hard on this - and telling the Government that linking tariffs or ACIS to an anti-union political agenda is unacceptable public policy making.
We all know what we want: a decade of policy certainty. I have had almost 9 years association with the industry through my involvement at the ACTU.
I can tell you that unions and their members have no interest in unnecessary disruption, lost production and stand-downs. We want the industry to prosper, provide more jobs, and be capable of providing better security and living standards.
To achieve this and to meet the challenges ahead we need dialogue, not division. We need practical solutions, not politics.
We need to work together, not to sue each other.
The Government's approach has put employers in the industry in a difficult position. But don't be seduced by politics. The industry and the livelihoods of the people that depend on it are too important.
Unions will be around a lot longer than this Government. Work with us to deal with the issues.
What my experience has taught me is that when people are willing to sit down and listen to each other, and understand the pressures that both employees and businesses are under, then cooperative, common sense and commercially workable solutions can always be found.
Speech to the Federation of Automotive Products Manufacturers, 7 August, 2002
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