INDUSTRIAL RELATIONS LAW – CALL OFF THE FUNERAL

The Hon Justice Michael Kirby AC CMG*

          It is exactly a hundred years since the uniquely Australian system of conciliation and arbitration was proposed to the Federal Parliament sitting in Melbourne.  The Bill was not passed until 1904.[1]  The idea remains one of the few lasting innovations to come out of a royal commission.[2]  So disruptive were the Australia-wide strikes of the 1890s that a commission was established to come up with a solution.[3]  Thus was born one of Australia's great social experiments.  The idea found its way into the new federal Constitution.[4]  Before very long, it saw the creation of a unique national court to bring a "new province" of law and justice to the relations between Australia's employers and employees.[5] 

          White Australia, tariff protection and conciliation and arbitration were the three pillars of Australian social policy for most of the first century of federation.[6]  Now White Australia is dead.  Tariff protection is on its last legs.  What of conciliation and arbitration?

          Since the High Court was first set up in 1903[7] and the Arbitration Court in 1904[8] there has been a close connection between the two bodies.  From the start there was an overlap in their personnel.  Of the forty three justices of the High Court, eight have at one time served on the national industrial tribunal:  Justices O'Connor, Higgins, Isaacs, Powers, Rich, Starke, Gaudron and me.  Justice Gaudron is on record as saying that the old Arbitration Commission was much more fun than the High Court.  For once, I will not dissent.  She was assigned the meat industry and spent much of her time trudging around the abattoirs of the nation settling strikes.  My assignment was to the maritime industry which, in those days, was comparatively easier to handle.  Higgins, the father of Australia's arbitration system, certainly regarded the industrial body as more important than the High Court.[9]  For ordinary Australians, it usually had more relevance.

          In 1907 the Arbitration Court established the basic wage of seven shillings a day for Australian workers.[10]  In 1922 it introduced automatic costs of living adjustments to protect workers and their families against inflation.[11]  Between 1920 and 1930 it gradually introduced the 44 hour week into federal awards.[12]  By 1947 the working week was reduced to 40 hours.[13]  In 1965, equal pay was awarded to Aboriginal stockmen[14], more than a quarter century before the High Court's Mabo decision.[15]  In 1968, equal pay for women was first awarded federally.[16]  In 1979 maternity leave was granted.[17]  It is a remarkable history of social change brought about through a national judicial institution.  No other country attempted anything quite like our system.[18]  It was distinctively Australian.  It achieved equity through labour law.

          Over most of the century, the High Court supported the innovations of the Arbitration body.  It upheld the log of claims procedure.[19]  It expanded the notions of what could constitute an industrial dispute.[20]  It narrowed the exclusive prerogatives of employers.[21]  Occasionally, it slapped its rival upstart down, as when, in 1956 it declared the Arbitration Court an unconstitutional mixture of judicial and non-judicial functions.[22]  This led to the divided Commonwealth Industrial Court and the Arbitration Commission.[23]  These have now emerged as the Federal Court[24] and the Australian Industrial Relations Commission.[25]  The latter maintains its tradition of innovation.  For example, in May 2001 it expanded parental leave to apply to casual employees.[26]  But gone are the days of the National Wage decisions that, up to the 1980s, affected just about everybody's wages.  In fact, some observers have suggested that the network of industrial relations law, that once ruled the Australian economy from Melbourne, is dead and the Commission that was its vehicle is now sidelined as a "bit player" in today's system.[27] 

          There is some evidence to support this assessment.  The Australian arbitration system worked through worker unions and employer organisations.[28]  The proportion of Australian employees who are members of unions has been steadily falling.  In 1996 it was 31%.  Last year it was only 25% and still dropping.[29]  In part, this change has been reinforced by the moves of successive federal governments to alter the focus of industrial law from industry-wide awards to workplace agreements.[30] 

          The Commission was undoubtedly damaged in the 1980s by the Staples affair[31] and the departure by the Hawke Government from the convention of appointing successive members of the national tribunal from those with significant professional associations with unions, employers' organisations and the public service.  The dropping of judicial titles also did not help the status of the body.[32] 

          What does the future hold?  It seems unlikely that there will be a return to the glory days.  But those who are waiting for the funeral should not hold their breath.  The use of national and State arbitral bodies may not always have been economically efficient.  But it is part of Australia's history and culture – and it played a key role in building the egalitarian features of our society that mark us off from many other countries.[33]  Economics is not everything.  Looking after those who need a safety net is also part of Australia's ethos.[34] 

          Moreover, the national system had some big successes in the past century.  It did help to avoid nation-wide strikes.[35]  It provided a rapid response to bring disputing parties around the table.  For these reasons Australia's strikes have tended to involve short term, localised disputes, often susceptible to conciliation.[36]  And the provision for conciliation and arbitration is in the Constitution[37] and unlikely to disappear in the near future.[38] 

          The suggestion that the common law of contract and trespass can fully take the place of the national tribunal system is unpersuasive.  According to experts, the resort to ordinary courts in actions against or by workers or trade unions has rarely proved useful in the urgent dynamics of industrial relations.[39]  A fire fighter is sometimes needed.[40]  The ordinary courts are not well equipped to fulfil that role.

          The big challenge in the future is likely to come from the growing moves to render labour standards throughout the world the subject of international rules, through bodies such as the International Labour Organisation.[41]  In a sense, it is the counterpart, and balance, to the World Trade Organisation.  It seems doubtful that, in the long run, Australia will be able to take one without the other.  The Industrial Relations Commission is well placed to be an instrument that will assist our economy to translate changing international standards into Australian employment practices.  Such standards are an increasing part of the global economy of which we ourselves are part. 

          So the work of industrial conciliation and arbitration in Australia will continue to change.  Whatever happens, it will continue to require lawyers.  In my view, lawyers can be generally proud of the contribution which labour law has made to the history of the Commonwealth in the first century of Federation.  It is by law and legal instruments that we created a land of general industrial justice.  In the years ahead the challenges will be different and global.  The workplace has changed forever.  Technology alone revolutionises the modern workplace.  But it is much too early to write the obituaries of industrial relations tribunals in Australia.  Call off the funeral.