Analyzing the Australian Fair Work Act 2009 from Alan Fox's Pluralist Frame of Reference - Essay Example

name of the university MANAGEMENT ANALYSIS STUDENT NAME LECTURER NAME 8/28/2012 ANALYSING THE AUSTRALIAN FAIR WORK ACT 2009 FROM ALAN FOX'S PLURALIST FRAME OF REFERENCE Introduction The dynamics of life nowadays has made work to become a basic to the human coexistence. Work establishes what we ought to do in our daily life and preoccupies much of our thoughts. It enhances our interactions and aid in defining our sense of identity as it offers us with material necessities of life and attainment of civilization (Glover & Patmore, 2010). Work allocation and remuneration, together with its organization and management are of significance importance, how these are carried out in any gainful employment explains much more about the perceptions and ideals we embrace as a society. What levels of unemployment a society considers bearable, what ways is work carried out and how disputes between employers and employees are resolved are open-minded concerns we hold, and more often than not shaped by the existing state of affairs such as economic conditions, cultural set ups and political atmosphere. Frames of References Individuals and groups have diverse opinions in relation to the everyday happenings they witness in their lives. Such opinions are always fashioned by the lives they are in, family conditions, kind of employment they hold and the companies they work for, the churches and social groupings they belong to, and friends they associate with. Since work is a fundamental necessity in individuals’ lives, its nature as well as control in a solitary social trend raises strong contemplation. Such contemplations are commonly “framed” in terms theories and ideals individuals draw on as “references” points when deliberating on the nature and control of work. Hence the term “frames of reference” a theoretical tool that was first coined by Alan Fox (1966, 1974). The term ‘frames of reference’ is a concept identified by Alan Fox (1966, 1974) as a means of classifying the different assumptions people hold towards workplace relations. Fox argued that there were three (3) such frames of reference, which he defined in terms of their unitarist, pluralist and radical (Marxist) assumptions. In other words, a frame of reference may be termed as the way one perceives the world; for example, when a union population density go down, this messes up a government; policymaker plans because of a concern of safeguarding employees as employers may appear to have stronger bargaining power, in such instance, the pluralist model is being employed as a frame of reference. In a pluralist political reflection, a government will always act in response to the influence of competing interest groups and, in most cases, enforcing the rule of law while keeping into consideration the rule of law. This leaves as with no doubt that a state will always look for equitable outcomes for both the employers and employees, which is balance of interest (Ostenfeld et al, 2001, p.176). The pluralist Employment Relations Pluralists start from a set of theories and ideals that a conflict at place of work is expected. The assumption is established on a basis of differences in interest between the groups, as it’s believed organizations are multifaceted social structures. Employers and employees make up two such groups, who subscribe to divergent ideals and objectives. Still in this frame of reference, it is assumed that conflicting control of the organization will at all times exist because of allocation of work responsibilities and remunerations. Those in support of this assumption believes that workplace conflicts are healthy to the effective progress and governance of the organization, as it exposes inequalities and grievances held by different factions and institute a platform of resolving this disputes amicably. It’s also believed that conflicts will prompt the management to explore different avenues some which are innovative in solving the problem thus producing the best outcomes. Pluralist acknowledges the presence and joining the trade unions, because of its beneficial interventions in dealing with employment relationship concerns on a shared basis. In this regard, the pluralist employment relations involves employees and employers negotiating in imperfect labour markets full of conflicting interests, that is, in the company of pluralist discrepancy, for instance, employers may be advocating for lower wages and salaries and flexibility of workers, whereas workers may be fighting for higher salaries, job security and conducive working environment, besides common interests like good quality of products and profitable organizations. It is also important for employees to negotiate for a fairer or good deal before signing employment contracts instead of only focusing on dispute resolutions alone. The basis of these notions makes the pluralists to consent to the legitimate right of employees to negotiate collectively and trade unions to take negotiation actions on their behalf (Fox, 1966) The pluralist perception of clash in interests is closely associated with a certainty that labour markets are imperfectly competitive. The imperfection in labour markets is said to be brought about by isolated companies in different geographical location, lack of savings among most employees, surplus in labour and, sometimes due to segmentation of labour markets and mobility costs. Kaufman (2005) argues that a key pluralist value is the denial that labour is merely a commodity and for that reason not permitted to equity in employment relationship. As a result, the role of the government is to promote equitable outcomes among the stakeholders, since unbalanced outcomes are believed to arise from labour markets that are not perfect, imbalanced bargaining power and unions’ advocacy. Analysis the Australian Fair Work Act 2009 from Alan Fox's Pluralist Frame of Reference It can be argued that the Australian Fair Work Act 2009 is significantly based on a pluralist frame of reference. This is because of its mandated National Employment Standards (Fair Work Act 2009, Miscellaneous 128), which are perceived to be pertinent means for balancing the play grounds between the workers and employers, therefore promoting the most favorable functioning of Australian labour markets as opposed to interfering with it-as argued in the competitive markets theories. Moreover, since there is a certainty that some conflicts of interests will always arise, the pluralist employment relationship school of thought opposes the unitarist dependence on corporate selfishness and goodwill to safeguard employees. Similarly, labour unions in Australia are perceived as a prolific counterbalance to corporate power, besides fair mandated standards helping too against the misuse of the corporate power. Control, power and authority in the employment relations Mostly, power, control and authority lies with the employers but will always be regulated by policymaker, which is the Federal State to avoid exploitative relations in the workforce. According to pluralists, management leads by exercising their full authority but still this authority can be questioned and lawfully contested or challenged in any court of law as seen in the Chapter 4 – Compliance and Enforcement, Section 545 on orders which certain courts can call upon. Pluralists believe in the fundamental imbalance of power, control and authority, which power relations are not permanently instituted and their dominance is subject to change at any convenient time needed. Wages and Salaries As exhibited in the Fair Work Act 2009, the modern awards integrate the National Employment Standards (NES). It under this Act that NES has been incorporated into all remunerations, which serves as minimum conditions for employees who are sometimes not covered in the workplace agreement, hence a safety net for the lowest remunerated employees. These considerations of awards by NES are vital in protecting the both the employees and employers. Working Conditions The National Employment Standards as stipulated in Part 6 section 761, encloses some employment terms conditions that should be observed by the employers. This helps in defining expectations of different interest groups in a labour market. For example, the maximum working hours in every week is supposed to be 38 hours plus any realistic extra hours that attracts bonuses. Flexibility in working arrangements is also allowed to allow parents with school going children to fit into work schedule as they also meet their parental duties like child care. Parents are accorded up to 12 months unpaid parental leave by their employers in addition to maternal or paternal leave. There is also annual leave of four weeks that is paid for every employee and additional one week for some shift workers. Public holidays will earn employees paid leave unless agreed upon by the two, which is between employee and employer. In section 767, there are modifications on how NES and agreements provisions are governed or implemented. Fair Work Information Each employer is supposed to issue a statement of Fair Work Information to all newly recruited workers. The statement encloses information about the National Employment Standards (NES), the most recent remuneration packages, how agreement should be made between the two, the workers right to association, right of entry or exits as elaborated in Part 6 subsection 4 of the Fair Work Act 2009, business transfers and roles of respective commissions such as Fair Work Australia and the Ombudsman where disputes of the two can be looked into or sorted out. Enterprise Agreements Part 1 sub-section 3 section 29 of the Fair Work Act 2009 establishes ways and channels to be followed when creating a business agreement. For example, single business agreements are initiated between a single employer and the workers. Single employer agreement could be made amongst several employers with common interest with their combined workers, like the case in franchise businesses. Greenfields agreements are initiated, before employing, amongst the employers and the trade unions which is well placed in representing those potential workers. Voluntary multi-employer are contracts that are made between employers and their employees. And low paid multi-employer is those agreements that are initiated by groups of lowly paid employees and their employers. In pluralists’ school of thoughts, all this agreements between employees and employers, and employers amongst themselves are geared towards solving unforeseeable disputes that could have arisen without the agreements. And before penning down a signature on any contract, each party is supposed to do a thorough consultation. Bargaining Agreements While the Fair Work Act does not guarantee any trade union to be present on the bargaining fronts between the employee and employer, it does provide where deemed so that a group of employees may on their own agree to be represented by a trade union. This is elaborated in details in Part 2 sub-section 3 of the Act. If so, then employer cannot exclude the union from representing their clients in negotiations. But still, workers may go into a negotiation with the employer without the support of a trade union. The content enclosed in the Fair Work Act regarding bargaining agreements consists of issues pertaining the employment relationship for example between employer and employee, and employer and the trade unions; payroll increases or reductions; and issues surrounding the binding of the agreement and its operations (Gough and Ogden, 2010, p.41). Legalism Since its establishment, the Fair Work Act has had it fair and turbulent moments in stabilizing the Australian labour market. Like any other statute, it has legally been challenged, but this has not stopped it from working in the interest of different stakeholders in the job market. In the interests of equity as per the pluralists’ frames of reference in employment relationship, both the employers and employees have been able to attain their intended objectives, for example, in order to be fair to employees, the formalization of contractual deals geared towards minimization of exploitation opportunities. Any legal intervention between the employer and employee is supposed to be addressed in a court of law and costs of legal challenges will be determined by the court after the outcome as stipulated in section 466: Costs of legal challenges in the Fair Work Act. Trade Unions Many people have perceived trade unions differently, but majority sees them as a means of improving both the social and economic wellbeing of employees. This has been through the advocacy of trade unions to better working conditions, reasonable pay, fair treatment and so on (Waring, 2000). According to Gough and Ogden (2010, p.45), labour bargains have helped to restore some balance in the labour market through the stoppage of exploitation of employees by powerful employers as it viewed during the industrial revolution. In Australia, trade unions have served as vehicles for development and equity in the job markets. Arbitration has helped many unions through provision of their organizational security, for example, by ensuring their recognition by employers and protection of its members from being poached by other unions. The Fair Work Act 2009 is friendlier to majority of trade unions, as it allows union staffs to enter any workplace where their members work or perceived to be, and where their members need their representation to negotiate with the employer, then employer will be compelled to work with the union. Besides being friendly, the statute has barred unions from organizing any industrial action, as more broad consultation is needed to find a solution to any dispute that may arise between the employers and employees. The Australian trade union movement is coordinated nationally by the Australian Council of Trade Unions (ACTU) whereas at State level, the coordination is by Trades and Labor Councils. Arbitration has been a key principal that many Australian unions have utilized in achieving reasonable wages and conditions, but since 2006, many unions have realized their goals by bargaining and negotiating political lines. Arbitration system was and still remains a bargaining tool that endeavor to unravel disputes between employers and employees through conciliation. However, political interventions have been used by a number of trade unions to realize their goals. For example, it’s believed that Australian unions are associates with Australian Labor Party hence decision making in the party is dominated by them, as they make about 61 per cent. They believe that involvement in a political process is vital and reap more fruits for them and their members. This perception is drawn from a belief that employment relations are basically viewed a sub-system of a larger social system. Regulation of Employment Relations The Rudd government established Ten National Employment Standards (NES) and modern awards when it took over power to govern the employment relationships, which was a replacement to previous standards by Howard. The NES are statutes which cannot be altered or excluded in any employment relations or in contract of employment. The regulations as per the NES has instigated a standard pluralist frame of reference that is believed to act on the basis of the demands of the economic system and in the interest of certain social demand of various groups, sometimes, where employees are not members but employers are. Nonetheless, because workers are not part of this, can do nothing to change the situation hence are forced to work within this system and cooperate with employers towards the fulfillment of the market demands. Similarly, employers can do little to change the political, economic or social influences and they too cooperate as long as their material needs are met, for example, employers will tend to accept the power of employees as long as their returns on investments in labour are realized. Employees may limit their input to ensure employers only reap what is worthy their investment, although, employers may assess the behavior of employees and make sure that workers’ contribution is worth what has been agreed upon. Summary From the close scrutiny of pluralist frame of reference in view of Australian Fair Work Act 2009, Fox is perceived as a great scholar who vastly contributed to the industrial relations. His frames of reference approach on pluralist has virtues that are beyond anyone’s wildest imaginations because of its clarity and insightful intellectual plea. Fox managed to elaborate on mechanisms on which frames of reference may be applied in employment relationships, something he did so convincingly in his affirmation (Ostenfeld et al, 2001, p.179) In reference to Fair Work Act, Fox claims touch on two vital thoughts; first, there is the idea that social systems such as trade unions may embody partial rather than universal values and interests. An adoption of any frame of reference could be determined by a stand of the people in regard to their interests and values they uphold. Secondly, the ideas on composition of employment state of affairs have both the market economic feature and the employment system feature, and that any normative evaluation of the two features. Conclusion The labour market and employment relations in Australia have greatly been influenced by the National Employment Standards as stipulated in the Fair Work Act 2009. NES have tried to minimize the disputes that were frequently exhibited in the labour market before the enactment of these statutes by Rudd government. The standards have also eliminated some interference on the labour market allowing the forces at the market to take their course, that is, supply and demand of labour to prevail. Even though, the harsh economic conditions and external forces have sometimes shortchanged the labour market thus affecting the friendly industrial relations. For instance, the economic slowdown, which was experienced around the world, impacted negatively on the labour market forcing the government to come in and try and stabilize the market. According to George (1999), interferences, from external forces like IMF and World Bank have also had effect on the employment relationship, for example imposition of terms and conditions on their loaning system such as retrenchment or downsizing of the workforce by State funded projects. Considering the pluralist frame of reference, it does not create a fair working condition or operating in by employees and employers respectively. References Bean, R. (1985) Comparative Industrial Relations, Routledge, London. Buchanan, J. and Watson, I. (2001). The failure of the third way in Australia: implications for policy about work. ACIRRT, University of Sydney. Davis, M. (2008). Backbench Revolt Looms for Labour Over Building Watchdog. Sydney Morning Herald. August 22. 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