Why does the trade union movement, overall, in Australia, support the Labor Party - Essay Example

? Why Does the Trade Union Movement, Overall, in Australia, Support the Labour Party? ………………………………………. ………………………………………. This paper is intended, first, to examine the trade union density, i.e. the proportion of the workforce in Australia, involved with a trade union; and second, to give a detailed account of the downward trend in membership, which has taken place since 1996, considering the acceleration in this decline during the 1990s, as well as the international nature of the phenomenon. Explaining the reasons behind the dwindling trade union membership, the paper scrutinises changes in the labour market composition, differences in the unionisation rate of certain groups of workers, along with the effects of conservative legislation, anti-union employer activity, relationships with federal government, etc. Finally, the paper details the trade union responses to membership decline, accessing whether those responses have been a success story. Introduction Ellem and Franks (2008), and Griffin (2002) write that trade unionism in Australasia (Australia and New Zealand) has not unexpectedly been shaped by their members’ prior trade union experience in Britain, given the numerous British migrants who had brought with them the values of their mother country; with the first formal unions having emerged amongst the most skilled employees, such as the Amalgamated Society of Engineers established as overseas branches of the ‘parent’ union in Great Britain (Sheridan, 1975, as cited in Griffin, 2002). It’s also noteworthy that the first unions had been town-based; having experienced rapid growth during the roaring twenties and the post-war decade, as well as being on the wane during the Great Depression and the ‘swinging’ sixties, the trade unions flourished in Australia over most of the twentieth century – with at least two out of every five workers being members of a union. The then trade unions’ status and power are considered to have been derived from the centralised conciliation and arbitration system first introduced in 1904 with the Conciliation and Arbitration Act (Svensen, Small, Griffin, n.d.). Due to the significant benefits promised, and consequently delivered by the new industrial relations system, like employer’s recognition, legally enforceable minimum wages, working conditions, etc., the Australian trade unions enjoyed remarkable ease in achieving their goals, following a descending hierarchy of arbitral, political, and industrial strategies, in contrast to other countries. Thus, in many cases, Australian unions are considered to have won their battles on bureaucratic battleground, rather than on the industrial one, to a degree that made some commentators to argue whether the title ‘union’ is being used correctly with regard to them (Howard, 1977, as cited in Svensen, Small, Griffin, n.d.). It should be mentioned that the then Commonwealth Court of Conciliation and Arbitration, nowadays the Australian Industrial Relations Commission (AIRC), has adopted the traditional horizontal occupational structure of trade unionism as the basis for its own segmentation (Griffin, 2002). Starting with about 200 unions in 1901 with over 97 000 members which represented 6.1 per cent of the working force, the number of unions significantly jumped, following the 1904 legislation – 573 in 1911, with more than 360 000 members representing about 28 per cent of the total number of employees. The post-World War One rationalisation had reduced that number to less than 400, followed by a slow decrease within the next decades – to finally drop below 300 until 1989. Overall, trade unionism in Australia until 1990 is characterised by three main features as follows: a skewed distribution of membership, multi-unionism at both industry and enterprise levels, and well-developed inter-union structures at national and state’s level but not at the enterprise one (Griffin, 2002). In other words, in 1990, 57 per cent of all unions (170 out of the total of 295) had memberships lower than 2000, whose combined membership was less than 3 per cent of total union membership; with thirty-four unions at the other end of the spectrum (11 per cent of all unions), each with more than 30 000 members, which covered 73 per cent of all members. While very few of the smaller unions had operated outside the boundaries of more than one state, 134 unions that comprised 83 per cent of total membership, operated in two or more states (Griffin, 2002). Another important detail regarding trade union membership in Australia during the 1990s, is the fall in proportion of employees working in industries with higher than average unionisation rate – from 62 to 58 per cent, as well as the drop in overall unionisation rate – 39.6 per cent compared to 45.6 per cent in 1986 (Australian Bureau of Statistics (ABS), 1994). Current trade union density According to figures released by the Australian Bureau of Statistics in 2011, the proportion of employees who were trade union members in their main job decreased from 20 per cent in August 2009 to 18 per cent in August 2010 (ABS, 2011). This percentage represented 1.8 million union members in their main job, with a fall of 47 300 as compared to the data from the previous year. The change has been driven by public sector employees with a fall in membership of 5 per cent, from 46 per cent in 2009 to 41 per cent in 2010 respectively, while the proportion of private sector employees who were trade union members in their main job remained at the stable 14 per cent (ABS, 2011). The figures have further shown some 75 000 employees who have been members of a trade union, though not in their main job, along with another 1.4 million employees who were not currently trade union members, although had been previously; of these, 77 per cent hadn’t been trade union members for five or more years, and four per cent – less than one year ago. Two thirds of the trade union members (66 per cent) had been such for five years or more, while 10 per cent had been members of a trade union for less than a year. The employees that had never been trade union members appeared 66 per cent of the total number of employees, or some 6.5 million (ABS, 2011). As for trade union membership in the main job, there are other findings which included Electricity, gas, water and waste services, as industries with the highest proportion of male employees who were trade union members (42 per cent); while for female employees it has been Education and training - 40 per cent respectively. The occupation with the highest proportion of male employees – trade union members, has been Machinery operators and drivers (28 per cent); for the female employees it was Professionals (33 per cent). The total percentage of trade union members – of all employees - in 2009 has been 13.4 as compared to 15.8 in the previous year. Membership decline – figures and causes As seen from the figures above, there is a pronounced downward trend in trade union membership, whose beginning might be sought at some point in the late 1970s, and though the membership is considered to have held up during the 1980s, the density fell (Svensen, Small, Griffin, n.d.). The downward trend accelerated during the 1990s, with both components – absolute membership and density – having fallen rapidly to their levels of the ‘70s and even worse, especially the union density. ABS figures indicate 52 per cent total union members as percentage of employees in 1990, as against 55 per cent in 1986/87 and 53 per cent in 1988, along with a drop in the number of unions – from 326 in 1986 to 295 in 1990. Different authors have attributed the decline to different factors; according to Peetz (1998, as cited in Svensen, Small, Griffin, n.d.) two main factors appeared responsible for the dwindling trade union rows – while structural changes in the economy have been dominant factor in the 1980s, the reduction of compulsory unionism is considered the chief factor in the 1990s (Svensen, Small, Griffin, n.d.). Structural changes in economy, like the decline in the proportion of workers engaged in manufacturing, especially in heavy industries, along with the decline in the relative size of the public sector, are thought to present a compelling explanation of the downward trend; moreover it appeared a common pattern across the developed world, perhaps with the exception of Sweden, Norway and Denmark (Leigh, 2005). According to ABS’s collection of trade union membership data, published in Trade Union Members (cat. No. 6323.0), the highest rates of union membership have occurred in industries such as electricity, gas and water, communication, public administration and defence; whereas manufacturing, construction and community services exhibit moderately high rates of trade union membership. On the other hand, service industries, like wholesale and retail trade, recreation, personal and other services, as well as rural industries, all exhibit lower rates of union membership (ABS, 1994). It’s noteworthy that much of the employment growth between 1986 and 1992 has been materialised in the least unionised industries, in marked contrast to the highly-unionised sectors of economy which suffered most of the employment loss – whereas recreation and personal services have grown by 45 per cent, finance, property and business services – by 28, and wholesale, and retail trade by 18 per cent respectively, electricity, gas and water declined by 23 per cent, and communication by 21 per cent (ABS, 1994). There are also factors such as size of employment location, which has a strong correlation with trade union membership rates, particularly in the private sector – in 1992 employment locations of less than 10 employees have displayed 13 per cent union membership, as compared to locations with more than 100 employees, which had unionisation rates of 51 per cent. The 1986 - 1992 trend of private sector growth in smaller employment locations with lower unionisation rates appeared to have contributed to the overall de-unionisation trend. Despite the increase in absolute terms in regard to the public sector (large employment locations), it declined in terms of relative share of total employment, with consequent (and largest) loss of share occurring in large locations (ABS, 1994). The sex and age structure of trade union membership – 35 % of female employees compared to 43 % of male employees, and 23 % of those aged 15 – 19 years, as against 46 % of those 45 – 49 year-old – appeared to have mixed effect on aggregate unionisation rates: the increase in employment share of women and the decrease in employment share of younger workers exert negative and positive influence respectively (ABS, 1994). All above-mentioned factors combined with the concentration of permanent part-time and casual workers in the high growth (less unionised) industries, along with much higher trade union membership rates amongst permanent full-time employees, would account for the collapse of trade union movement in the 1990s. However, this collapse has been more rapid in Australia than in any other country, except perhaps New Zealand (Leigh, 2005), which implies another factor/factors involved. Some authors (Svensen, Small, Griffin, n.d.), suggest that although the decline could be said to be associated with the above-mentioned structural changes in economy, its explanation would be found not that much in the changes per se, but rather the way in which those changes are being brought about and responded by unions, employers and governments as well. While factors such as unemployment, the increased use of part time and casual labour, etc., are considered more or less concomitants of economic development within the market-led economies, therefore something that unions should be prepared to deal with, there is another likely cause of the decline, as pointed out by David Peetz (1997) – the effect of government and legislation on trade union density, expressed in collapse of compulsory unionism. Having significantly fallen between 1976 and 1990, the latter is thought to have plummeted in the period from 1990 to 1996, as seen from 1996 Australian Election Survey (AES)’s data indicating 25 per cent of union members being in compulsory unionised jobs (Peetz, 1997). The union density figures in other surveys - from 1976, 1988, 1990 and 1995 – suggest that the proportion of employees in compulsory unionised jobs has fallen from 34 per cent in 1976 to 23 per cent in 1988, 21 per cent in 1990, and about 11 per cent in 1995 respectively (Rawson, 1978 and 1992, and Grimes, 1994, as cited in Peetz, 1997). Fig. 1 Trade union density trend from 1911 to 1996 (after Harcourt, 1999, source Labour Reports and ABS Cat.6323.0) Conservative governments-led initiatives in five out of six states, between 1990 and 1995, introducing legislation aimed at prohibition of compulsory unionisation (banning ‘closed shops’), encouraging individual bargaining, and facilitating the transition to non-award coverage, are believed amongst the most significant factors in Australian de-unionisation (Leigh, 2005). The 1980s and 1990s Labour governments have adopted neo-liberal policies of deregulation and free trade; the Howard government further intensified the neo-liberal agenda of the Labour, while the Workplace Relations Act of 1996 has made provision for the certification of individual employment contracts and downgraded the roles of the Australian Industrial Relations Commission and industrial awards; all that put together, to one degree or another, appeared to have exerted pressure on trade unions and accelerated the de-unionisation. An important driver of that trend is considered the rising competition; with monopolies being broken down and markets having become more competitive, management was necessitated to start cutting costs and seek stronger anti-union tactics, in order to reduce the wage bill (Leigh, 2005). The growing inequality in earnings provides another explanation for falling trade union density in regard to unions’ aspiration not only to higher wages, but also for greater pay compression (Leigh, 2005). To put it bluntly, as Leigh points out (2005), the unions are much more interested in applying standardised pay schedules and claims which request the same increase for all workers, insofar as within a company with less pay dispersion, the workers are more likely to make a common cause with those earning similar wages. Besides the factors thought to have triggered the decline in trade union membership and density, as already discussed above, there are reasons which have their origin within the trade unions’ behaviour itself. The social contract between the Australian Labour Party and the Australian Council of Trade Unions (ACTU) negotiated in 1983, known as the Accord agreement, is considered one of them. Having provided for reinforcement of the centralised system of industrial relations, and the re-integration of a wage indexation system which linked the wages with movements in the Consumer Price Index (Griffin, 2002), the Accord appeared responsible for two major influences on trade union membership towards acceleration of the decline. The first is expressed in deepening Australian trade unions’ reliance on the centralised arbitration system, rather than the traditional (worldwide) trade union means of struggle in industrial disputes. The second is represented by the policeman-like role ACTU have adopted, vigorously enforcing the provisions of the Accord (Griffin, 2002). Peetz (1997) points out that compulsory unionism can lead to atrophy in union organisation as closed shops have been associated with less responsive union’s behaviour and ineffectiveness in promoting employees’ voice, and therefore union satisfaction and power declined; while Kuhn claims that ‘the response of the ACTU leadership to unions which have challenged the Accord has been ruthless’ (1993). Two more factors, also stemming from the closed shops system, which have contributed to the decline, appeared the poor organisational structure and lack of mindset necessary to organise workers (Griffin, 2002). Trade union responses to the decline – strategies and initiatives Against the background of a decades-long decline in both absolute membership and union density, ACTU as dominant union body of Australian trade unionism, and strategic driver responding to/ initiating change, adopted a document titled ‘Future Strategies for the Trade Union Movement’, proposing the restructuring of trade union movement along broad industry categories (Griffin, 2002). The establishment of eighteen to twenty union groupings has been proposed with the vision of those groupings as a catalyst for consequent formal amalgamations. Further the policy has been extended in terms of supporting ‘the rationalisation by agreement of union coverage with the aim of significantly reducing the number of unions within each enterprise of industry’ (ACTU, 1989). While very little progress has been made in implementing this policy in the period between 1987 and 1989, the 1989 ACTU Congress, according to Davis (1990), was dominated by the task of reviving and restoring union membership. Though neither being smooth nor undisputed, the implementation of merger strategy was well underway by the time of 1991 ACTU Congress (Davis, 1992); by the time of the 1993 Congress, as Kelly points (1994), the process was at ‘almost breathtaking pace’. Favouring the establishment of large organisations, ACTU’s approach appeared based on the presumption that small unions just ‘squandered financial and human resources’ (Davis, 1990). Though the general goal of restructuring the Australian trade union movement has been achieved, union mergers eventually failed to arrest the decline in membership, which has even accelerated in the post-merger period (Griffin, 2002). There are some issues in regard to the provision of services within larger, amalgamated union entities. According to Griffin (2002), due to their ability to facilitate access to larger number of members/customers, quite logically, they have been able to deliver a much broader and cheaper range of non-industrial services. The issue of delivering a better range of industrial services to the union members is a bit more controversial, insofar as is considered bi-component – the actual range of services and the membership perception of the range and quality of those services. However, by presumption, the merged unions are thought to deliver a broader range of services, and though arguably, to deliver them more effectively (Griffin, 2002). Hanley (1999) founds that the amalgamated entities have been perceived as providing a better range of in terms of wages, benefits, and keeping members informed on union issues, as against a far worse performance in terms of employment security and members’ say in running the union. Initiatives like the Organising Works Programme represent an additional effort in recruiting union trade members, which appeared a step agreeably away from the compulsory unionism and the centrally regulated, arbitral system, within which unions had a secure modus operandi, so characteristic of the twentieth-century Australian trade unionism. Nevertheless, authors like Andrew Leigh (2005) considered the downward trend in union membership highly improbable to be reversed, and the resurgence of Australian trade unions – unlikely to happen. Conclusion Despite the neo-liberal policies of deregulation and free trade adopted by the Labour governments during the 1980s and 1990s, Australian unions are considered to draw closer to ‘their’ Labour Party for reasons easy to understand. First, it is the trade union’s normal affiliations to a left of centre political entity, which British migrants – later Australian trade union members and activists - had brought with them from their homeland, along with the just as normal (from a unionist point of view) repudiation of the liberal/neo-liberal free-trade principles. Second, these affiliations have been sealed with the Accord agreement between Australian Labour Party and ACTU in 1983, which was being sought to reinforce the centralised system of industrial relations and to entrench the unions’ position within. Finally, the decline of trade unionism, which is seen to continue in present times, further reinforced by the changes in structure and nature of employment due to the global economy trends, requires their old friend’s political support, more desperately than ever. References 1. Australian Bureau of Statistics (1994) 4102.0 - Australian Social Trends, 1994, Industrial Relations: Trends in trade union membership. Retrieved from http://www.abs.gov.au/ausstats/abs@.nsf/2f762f95845417aeca25706c00834efa/ad00d118f6667d8fca2570ec007868d9!OpenDocument 2. Australian Bureau of Statistics (2010) 4102.0 - Australian Social Trends, Data Cube – Work. Retrieved from http://www.abs.gov.au/ausstats/abs@.nsf /mf/4102.0 3. Australian Bureau of Statistics (2011) 6310.0 - Employee Earnings, Benefits and Trade Union Membership, Australia, Aug 2010. Retrieved from http://www.abs.gov.au/ausstats/abs@.nsf/mediareleasesbyCatalogue/9F48D6BD3EAF15FACA25742A007C0E8F?Opendocument 4. ABS Publications on trade unions, industrial relations and the labour market (including 6323.0, 6325.0, and 6203.0), ABS, Canberra. 5. ACTU (1989) Policies and Strategy Statements Adopted by ACTU Congress September 1989, Melbourne 6. Davis, E., (1990) The 1989 ACTU Congress: Seeking Change Within, Journal of Industrial Relations, no.1, 32: 100-110. 7. Davis, E., (1992) The 1991 ACTU Congress: Together for Tomorrow, Journal of Industrial Relations, no.1, 34: 87-101. 8. Griffin, G. (2002) Union Mergers in Australia: Top-Down Strategic Restructuring, Working Paper N 80, National Key Centre in Industrial Relations, Monash University. pp. 2, 3. Retrieved from http://www. buseco.monash.edu.au/mgt/research/working-papers/nkcir-working-papers/ nkcir-workingpaper-80.pdf 9. Ellem, B., Franks, P. ( 2008) Trade Union Structure and Politics in Australia and New Zealand, Labour History, vol. 95, pp.43-68. Retrieved from http://www.historycooperative.org/journals/lab/95/ellem.html 10. Hanley, G., (1999) Member-Union Satisfaction in Australia, Australian Bulletin of Labour, no.4, 25: 306-333 11. Harcourt, T. (1999) The future of Australian unionism in the global economy, Australian Council of Trade Unions, Melbourne. 12. Kelly, D. (1994) Trade Unionism in 1993, Journal of Industrial Relations, no.1, 36: 135-146. 13. Kuhn, R., (1993) The Limits of Social Democratic Economic Policy in Australia, Capital and Class, 51: 37 14. Leigh, A. (2005) The Decline of an Institution, Australian Financial Review, p. 21. Retrieved from http://people.anu.edu.au/andrew.leigh/pdf/Deunionisation .pdf 15. Peetz, D. (1997) The Paradigm Shift in Australian Union Membership: A Tale of Compulsory Unionism. Retrieved from http://www98.griffith.edu.au/dspace/ bitstream/10072/15610/1/6615.pdf Read More