Workers Online
Workers Online
Workers Online
  Issue No 16 Official Organ of LaborNet 04 June 1999  

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Legal

A Fair Case for Free-Rider Laws

By David Chin - Solicitor, Jones Staff & Co

The proposal to enable unions to charge non-members a service fee for negotiating enterprise agreements is consistent with the principle of freedom of association.

 
 

David Chin

Discouraging "free-riders" is essential to give meaning and practical effect to the concept of freedom of association.

The proposed amendment of the Industrial Relations Act 1996 to provide for such a service or agency fee is one of a raft of industrial reforms which Labor Council is advocating (see previous articles in Issues 6, 11 and 12 of Workers Online).

The proposal involves enabling union negotiated enterprise agreements to contain a provision requiring non-member employees covered by an agreement to pay fees at the same level as a contribution for union membership during the life of the agreement. It is envisaged that such a provision would have to be voted on and supported by a majority of the employees to be covered by the enterprise agreement.

Critics of this proposal will no doubt argue that requiring non-members to pay a fee to unions will offend the principle of freedom of association. This is a familiar refrain used by opponents of all forms of union security or preference measures. However, this appeal to a universally accepted principle to justify free-riding is both superficial and simplistic.

Free-riding is not tolerated in the commercial sector. No one, for example, expects the NRMA to provide road service to non-members. Similarly, there is no justification for making unions provide industrial services to non-unionists.

The right to freedom of association , including the right to form and join trade unions is an internationally recognised human right. United Nations International Covenants and various International Labour Organisation (ILO) Conventions enshrine this right.

The right to freedom of association is meaningless if it does not carry with it a right to effectively pursue the very activities for which the association was formed. In the case of trade unions, this means that unionists must be free and able to pursue legitimate industrial aims through collective bargaining.

In the context of an anti-union federal labour law system, the problem of non-members free-riding on the industrial gains of unionists very seriously threatens the ability of unions to pursue its aims. If non-members continue to be free to enjoy material gains won by unions without having to contribute in any way, the lack of incentive to join threatens to undermine the bargaining strength of unions. For collective bargaining to work, employees must be confident that enough others will cooperate and join with them in the union to make their contribution in union dues worthwhile. This confidence is undermined by a system that provides an incentive to employees to not join a union.

The Industrial Relations Act states that enterprise agreements cannot be made to apply only to union members (section 30(2)). Therefore non-union members employed in an enterprise unavoidably benefit from union negotiated agreements. There is an incentive for such employees to refrain from joining a union because they will reap some of the rewards of membership regardless, especially in the form of increased wages through enterprise agreements.

A Full Bench of the Industrial Relations Commission recently examined a related but different proposal for enhancing union security involving a union "members only" award application by the Health and Research Employees Association (Re Hospital Employees HREA Members (State) Award (1997) 75 IR 7). The application was turned down by a majority decision, with two of the four judges (Vice President Cahill and Justice Peterson) taking the view that an award which applied only to union members was a method of encouraging union membership which lent "towards a level of practical compulsion", and so was contrary to the Act (President Fisher and Commissioner McKenna both disagreed with this view).

Unlike the international instruments referred to above, the Industrial Relations Act does contain an express prohibition against compulsory union membership (section 209(2)).

However, no employees will be compelled to join a union under this proposal; and the proposed ballot to precede any such requirement gives the process added democratic legitimacy.

The Principles for the Approval of Enterprise Agreements developed by the Commission in December 1996 already encourage participation and consultation of all groups of employees in the negotiation process.

Under the proposed scheme, non-members will retain their right to not join a union. Those employees will merely be made to contribute to a process from which they ultimately benefit. It is a contribution which should be seen simply as the price to be paid for exercising their right to not join a union in the context of a system which cannot afford to carry free-riders. After all, there is a cost attached to the positive right to join a union in the form of membership dues. Why should non-members be exempted absolutely from any cost in exercising their right to not join a union?

Union service fees would promote the principle of freedom of association by assisting union members to pursue more effectively the collective activities for which their association was formed.


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*   View entire issue - print all of the articles!

*   Issue 16 contents

In this issue
Features
*  Interview: Opening Australia
Lindsay Tanner talks about new ideas, new policy and new politics in the Information Age.
*
*  Unions: An Educated Fightback
A visiting US trade unionist reveals how training better union delegates is the key to reversing the membership slide.
*
*  Legal: A Fair Case for Free-Rider Laws
The proposal to enable unions to charge non-members a service fee for negotiating enterprise agreements is consistent with the principle of freedom of association.
*
*  History: New Ideas in Labour History
See the latest from the May issue of Labour History, A Journal of Labour and Social History.
*
*  International: Tiananmen Square Ten Years On
We remember the massacre and the role that working people continue to play in fighting injustice.
*
*  Review: Organising Our Future - What Use the US??
A new paper looks at what Australian unions can learn from the experiences of their American colleagues.
*

News
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»  Labor Hire Cowboys - the NFF Link
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»  Murder Call: Charge Bosses Who Kill
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»  Braddy Bunch to Lift Contractor Veil
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»  Rural Redundacies - Redeployment Confusion Reigns
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»  Woolies Shopfitters Win Back Jobs From Body Hire
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»  Political Payback: NSW Targetted in Costello Cuts
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»  Rio Tinto Buries the Truth
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»  Child Care Campaign out of the Blocks
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»  East Timor Mercy Ship heads for Dili
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»  Fabian Society Reforms
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»  Industrial Who�s Who Head for Geneva
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Columns
»  Guest Report
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»  Sport
*
»  Trades Hall
*
»  Piers Watch
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Letters to the editor
»  Language is Important
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»  Kids Know Best
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»  Unions to Thank for Women's War Wages
*

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