Why Was the System of Industrial Relations in Australia Established - Assignment Example

The paper 'Why Was the System of Industrial Relations in Australia Established" is a good example of a business assignment. In the early 1970s, Australian experienced adverse trade movements in relation to oil price which shocked as well as diminished the entire capacity of the Australian economy to sustain the rising living standards without actually affecting the chronic balance of payments. As a result of this effect, there was a need for the government of Australia to introduce a range of reforms which were intended to enhance the competitiveness of all the Australian industries especially in the international markets (Noah, 1994, pp.78).The so introduced reforms comprised of reductions in tariffs, the floating of the Australian dollar, abolition of most foreign exchange controls and increased Australia’s openness to foreign competition. These reforms actually led to the creation of a competitive environment which had a great effect on the labor market. Faced with much more competitive environment especially in the international arena, there was a need for changes to occur in the labor market institutions and these changes were mandatory. The system was actually set up a century ago by Australian policymakers together with the Australian government primarily as a mechanism which creates a balance of interest of workers as well as business. There was an urgency to implement and establish industrial relations system in Australia which was meant to manage conflicts through reconciliation and arbitration as well as manage the booming economic changes through a form of collective bargaining which was supposed to operate on the principle of a neutral umpire (Mills,2008, pp.67-80).

The established industrial relations system primarily was meant to give primacy to bargaining at the enterprise as well as workplace level rather than so initial established system in which it was centrally-determined pay and working arrangements. The Australian Industrial relations system has actually been operating for several years and it's unique in the world as it makes recognition of the unions as major bargaining parties with relevant legal rights as well as sufficient employee fixed wages and conducive conditions. Current Australia’s modern competitive economy today is underpinned by flexible industrial relations system which actually links productivity to remuneration. Additionally, the established industrial relations system promotes innovation and efficiency gains as far as employees are concerned at workplaces. The system gives employees and employers an opportunity to discuss and negotiate flexible local agreements as well as it gives room for all the Australian companies to respond competitively to global challenges. Additionally, the Industrial relations system under the Workplace Relations Act recognizes a legitimate role for all the unions and employer organizations Freedom of association laws (Bruce,pp.45-67, 1997).

These laws are meant to ensure that an employer cannot dismiss an employee without concrete reasons for the dismissals. Moreover, the established industrial relations system gives powers to the union to ensure that employees are fully compensated in case of an accident while at and the working conditions are update and favorable to the workers too. As a way of managing conflicts, the Australian industry system ensures that all the employees have access to remedies for breaches hence they have a right to take lawful industrial actions against their employers.