The paper 'The Industrial Relations System in Australia' is a great example of a business case study. The processes and structures that underline Australian industrial relations arrangements have seen significant changes in the last three decades. Indeed, the organisation of Australian industrial relations was regulated at the industry level. through the provision of national and state-based awards for most periods of the 20th century (Wooden, 2000). However, the industrial relations system in the country has been overhauled particularly since the mid-1990s. The determination of working conditions and setting of minimum national standards has been largely determined at a firm level.
Workplace relations reforms have been conducted since the 1990s in Australia and it led to the establishment of the enterprise bargaining system that has been so dominant form of labor relations system in the country. This essay discusses the rationale for workplace relations reform in Australia and identifies winners and losers of this process. It also briefly explains the reasons why Australian voters are reluctant to accept an individual workplace bargaining system. Industrial relations processes are classified into two categories.
Employment relationship regulation is the first process and it basically entails setting down rules governing salaries and work conditions. According to Bray and Waring (2006, p. 01), four sub-processes regulates the Australian employment relationship. They include collective bargaining; individual, common law contracts; state regulation (either through modern awards or enactment of legislation); or by directly exercising managerial prerogative. For most employees that are working in industries other than the public sector or industries that have well-organized unions, state regulation and managerial prerogative are the major ways of regulating the employment relationship. Dispute resolution is the second process of workplace relations.
An inherent characteristic of an employment relationship is the issue of disputes (Bray et al. , 2005). The collective bargaining system, the FW Act, and modern awards all set out the mechanisms by which disputes can be settled. The industrial relations system in Australia has evolved in a different manner compared to the evolution of workplace relations systems in other OECD countries. Since the beginning of the 20th century, conciliation and arbitration tribunals developed by the state and federal governments regulated matters relating to industrial relations through the provision of national and state-based awards.
However, this system significantly diminished from the 1980s as the enterprise bargaining system became a more prominent method of settling industrial disputes in Australia (Creighton & Forsyth, 2012). Indeed, setting terms and conditions of employment by tribunals have been significantly reduced. Labour government in place during this period started this shift and became popular in the middle of the 1990s. At the time, the objective of workplace relations reforms that were carried out involves the determination of wages and working conditions by means of an enterprise bargaining system to an extent that it is possible. The constitutional foundation of Australian industrial relations has been changed by successive governments from 1993 to 2005.
As a result, the federal government has been given power, inter alia, to directly carry out the legislation of minimum employment conditions for the majority of companies that have been incorporated together with their employees. Nonetheless, in practice, it was only applicable to a number of matters while awards dealt with the remaining issues (Organisation for Economic Development and Co-operation (OECD), 2012).
In 1996, the Workplace Relations Act (WRA) was adopted to regulate industrial relations in Australia. It strengthened the collective bargaining system and allowed employers to negotiate directly with employees and subsequently conclude agreements with them. It limited the instances when awards can be given to only “ allowable matters” (OECD, 2012). Furthermore, WRA emphasizes the role of awards as a safety net above which organizational employees and employers could carry out their respective bargaining. In 2005, Work Choices replaced WRA as principal legislation guiding industrial relations in Australia.
It further stressed individual over collective workplace relations (Lounden, McPhail, & Wilkinson, 2009). It gave the newly established Fair Pay Commission the role of setting minimum wages. The commission sped up the process of simplifying and rationalizing the national and state-based awards system. The measures introduced by the 2005 Work Choices became very controversial and played a significant role in the federal election campaign and results of 2007.
Bray, M. and Waring, P. (2006). ‘The Rise of Managerial Prerogative under the Howard Government’ Australian Bulletin of Labour, 32 (1), pp. 1—12.
Bray, M. Deery, S. Walsh, J. and Waring, P. (2005) Industrial Relations: A Contemporary Approach, 3rd Edition, North Ryde: McGraw-Hill Irwin.
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