Airline Dispute of 1989 - Assignment Example

Introduction The Australian Airline Dispute of 1989 has been labelled as one of the most costly industrial disputes to the government and the Australian economy in general. It commenced on the 15th day of August 1989 and ended in March 1990. At that time, some of the most significant stakeholders in Industrial relations and organised labour were forced to intervene in the situation in order to put an end to this Dispute; examples of these groups included the Australian Council of trade unions, Australian Industrial relations, Australian Federation of Air Pilots, the Hawke Labour government and Airline companies as well. Estimates indicate that tourist businesses dependent on the Australian Airline industry lost approximately five hundred and sixty million dollars worth of revenue and much more was lost in the broader economy. Given such significant implications, then there’s a need to analyse the actions of these stakeholders and find out whether the parties were justified or whether their actions were effective. History or background to the 1989 Airline Dispute The major reason cited for the Dispute was wage labour increments. However, analysts assert that this was merely one of the issues that prompted the Dispute. Instead, there was an amalgamation of problems that eventually spun out of control and culminated into the Dispute. Therefore, one cannot ignore the influence of wage labour issues in the matter. It should be noted that the work of pilots is unique both in terms of its technical and managerial aspects. This was one of the elements that prompted these workers into a Dispute. First of all, pilots in Australia normally go through rigorous training that is personally funded; this is done in order to get a Pilot’s license. Shortly after, pilots are required to get a commercial pilots license through the Civil Aviation Authority. After this, a pilot is expected to work on small aircrafts for a period of five to twelve years and may progressively move onto larger aircrafts. Once again, climbing up these ranks required different sets of licenses. (Curlews, 2004) The number of pilots in Australia in the period starting from 1980 to 1989 was not intensely high especially because a huge number of them worked for three major domestic airlines i.e. Ansett, TAA and Qantas. In fact, this number varied from five thousand to five thousand eight hundred at that time. This indicates that relatively few people can qualify for these positions so the profession is quite superior. All the latter facts indicate that the profession is a highly skilled one requiring a lot of patience and persistence before witnessing any positive changes to one’s goals. A lot of experience is required in order to get a top position in any major Airline. Besides that, not only do pilots need managerial and technical expertise, they also need to brace themselves for all the complicated work challenges synonymous to their professions. For instance, pilots ought to be accustomed to unusual working hours and long periods away from their friends and family. A pilot also spends so much time in training that by the time they actually start working in major Airlines, they are left with only a few years to do so. On top of that, their profession brings with it huge responsibilities since the lives of hundreds are under their control. They are often subjected to several medical tests at unpredictable times and all these factors contribute towards the complexity of the profession. Given these scenarios, then it only natural for pilots to demand sound monetary payment for their services as well as effective workplace support that will go a long way in compensating them for these challenges. However, Australian pilots felt that the latter matters had not been addressed. (Paterson, 2008) One of the issues brought out in the Dispute was the problem of earnings as related to productivity. It was a well known fact that most pilots in Australia received over two point five times more wages than their counterparts in other sectors of the economy, nonetheless, when taken in context or when compared to other pilots overseas, Australian pilots actually fall short. They are classified as falling in the middle range of incomes within the international arena. Besides that, the level of increases that these pilots can get is also significantly lower. (Curlews, 2004) Nonetheless, prior to 1989, concerns for increments in the wages were never a major issue among Airlines as pilots represented only a small portion of all the operating expenses incurred by these airlines. Aside from that whenever pilots demanded wage increments, Airlines would simply agree amongst themselves to increase passenger flight costs and other Airline employees rarely joined in the bandwagon if pilots began to demand increments in labour. This was the reason why pilots tended to get what they asked for in case of any problem. However, with time, these factors changed as the Dispute brought with it new resolutions that effectively undermined the power of the Federation. There were several issues surrounding collective bargaining that affected the outcome of the 1989 Airline Dispute. The Australian Federation of Airline Pilots (AFAP) was one of the most influential. This group represented the biggest percentage of domestic Airline pilot representatives. International pilots from Qantas belonged to the Australian International Pilots Association that was a breakaway group from the AFAP. Membership in the AFAP was only guaranteed after payment of pilot’s salaries thus indicating that this federation had a huge incentive for salary bargaining because their monetary strengths were directly dependent on these increments. This was the reason why more than half the members of the AFAP were directly involved in the dispute. It should also be noted that the AFAP had a very dominant position in collective bargaining without regard for other similar institutions. For instance, they rarely involved themselves with the Australian union movement and they had earned a reputation of being very aggressive about their demands. In other words, the Airline Dispute reflected the stance of this group and the reactions that the Dispute drew from the government at that time. It should also be noted that the AFAP fully understood the value of their pilots. They knew that pilots were more or less indispensable. If members of this profession chose to go on strike, then they possessed the capacity to literary immobilise the Airline industry. This was because once a pilot is licensed to fly a certain aircraft, then it would take long periods of training to acquire another license to fly another type. In the event that the government opted to bring in international pilots, the association of the AFAP already had a strong association with the Australian International pilots Association and this would therefore make it difficult for them to be replaced. In other words, they possessed the upper hand. (Paterson, 2008) In 1983, the AFAP agreed to go back to an award known as the Accord which was basically an arrangement between the Australian Council of Trade Unions (ACTU) and the government. Here, the latter council has agreed that they would abide by certain patterns of wage bargaining and that the government had a role to play in effecting these changes. Consequently, pilots who had grown accustomed to having things done their way during wage negotiations could no longer do so after their union accepted the Accord. In fact, this was one of the reasons that pushed them towards the 1989 Airline Dispute. The Accord was a very complex piece of document that contained a wide range of issues from promotions, training, work allocations and many other aspects affecting pilots. It was therefore a big problem for them to operate under such stringent conditions. (Holt, 2008) An analysis of the actions of parties in the 1989 Airline Dispute The Airline Companies’ agenda As it had been stated earlier, there were two major Airlines operating within the Australian air industry i.e. the Australian Airlines (AA) as well as the Ansett Airlines. Prior to the Dispute, it had been anticipated that AA would be privatised, also, there was marked cooperation between AA’s pilots and their management. This therefore increased pilots’ expectations on what they could achieve from their management. During June 1989, members of the Australian Airline management got into negotiations with their pilots who belonged to the federation but there were no forthcoming results because of the Accord. It was therefore difficult for these pilots to get anything from their management. They had to look for another way around this impediment. One can therefore argue that their actions were justified in terms of looking for a viable alternative out of their quagmire. On the other hand, the situation at Ansett Airlines has plummeted out of control. This Airline Company may be blamed for the 1989 Airline Dispute owing to the fact that they breached protocol on promotion of its senior captain. Besides this, the latter organisation has also engaged in a number of unjust acts towards the pilot profession that can be summed up as follows: disregard for the need to pay pilots draft pay, they also failed to revise pay after introduction of a new aircraft, increase pilot benefits during travel and refused to operate under the manning levels. Airline companies opted to fire pilots at the first week of the Dispute irrespective of the challenges that these actions would have upon the lives of the pilots. As if that was not enough, airline managers opted to declare their position vacant and advertised throughout the world that they were interested in recruiting new members. This eventually propagated the crisis into the big problem that it became. (Wailes, 1999) Airline companies had a huge role to play in the process of prolonging the Dispute largely because they had a hidden agenda in the process. Prior to the 1989 the AFAP was highly influential in pay negotiations or the affairs of its pilots in relation to their employers. Consequently, these Airline companies were tired of the power held by the latter Federation and therefore wanted to look for ways of curbing this. In reports made about meetings held between the Airline company representatives and the government, it was a common assertion by the latter group that they were not prepared to give anything to the Federation. Instead these Airline companies felt that if they could overpower the AFAP then they would have considerable influence over the rate at which their businesses progressed. In fact, some of the entrepreneurs within these companies wanted to isolate the AFAP without involvement of other trade unions and they were actually very effective in achieving the latter objective. By the end of the dispute, the other trade unions within the Airline industry had made a turn around such that the Australian Council of Trade Unions was in support of the actions of the Airline companies. The Airline companies’ agendas were not fully understood by the larger trade union movement or the public for that matter until the end of the Dispute because if this were so, then the Airline companies would have done something to alter those perceptions. Airline companies were able to achieve their objective because their owners had formed links with commissioners from the ACTU. (Wailes, 1999) It should also be noted that the real agenda of the Airline Company was also visible through the fact that they eliminated the collective bargaining elements amongst the pilots. At the end of the Dispute, pilots were only recruited through individual contracts. In the end, the power of the Federation was destroyed and it can therefore be argued that the real agenda of the Airline companies was achieved. This was a strategic decision that required some time before stakeholders found out what was actually going on in the latter group. Pilots and their decisions After commencement of the Airline Dispute, Airline companies were placed in such a situation that they desperately needed pilots. Because it was difficult to meet the demands of the striking pilots, these companies opted for a change in strategy. They got a number of pilots who were willing to drop their professional and ethical obligations in order to take up the now vacant jobs. The latter group was represented by a group of unethical local pilots called ‘Scabs” or who chose to engage in ‘scabbing’. The media at that time defined scabbing as the act of taking a job that did not belong to someone because of self seeking interests. These pilots had formed an unlawful alliance with management and it can therefore be said that their actions led to the disrespect that plagued the Pilot profession during the dispute. Besides that strategy, Airline companies also got foreign pilots to fill in the positions left vacant after the onset of the Dispute. The main intention of bringing in the foreign pilots was in order to create a sense of fear amongst the striking pilots thus prompting them to reconsider their position. In other words, the foreign pilots were seen as the bait that would coerce ordinary pilots back to their positions. It seems that this strategy worked because four months after commencement of the strike, some pilots started to grow weary of the presence of the replacement pilots and felt really pressured. Eventually these individuals found their way back to work and abandoned the rest of the federation of pilots who were still engaging in the strike. One can therefore argue that these pilots were manipulated back into their positions and that Airline companies had destroyed the environment of trust, cooperation and respect that are necessary in order to run an effective Airline business. All in all, it can be said that only the small crop of pilots who had initially replaced the striking ones were the ones who had been unprofessional. The rest of the members of the Federation had duly warned their managers on what would happen if their demands were not met just prior to the strike. Consequently, these pilots had laid down all their cards on the table. (Wailes, 1999) On the other hand, Airline companies were using the fact that they had an upper hand in the matter to coerce their employers back to wok. In fact, media reports at that time assert that those pilots who went back to work did so with a lot of shame and remorse. Most of them felt that they had violated the agreement made with other members of the Federation and were therefore ashamed of their actions. Despite this, their actions need not be harshly judged as they were only trying to safeguard their positions. The role of organised labour in the Dispute Another group that was instrumental in this Dispute was the Civil Aviation Authority (CAA). This group also failed in their responsibilities because they were compromised by pressures from the government. At that time, they were told to relax their rules on admission of a number of foreign pilots within the major Airlines. They accepted these requirements yet they had the option of sticking to their principles. Worse still, it was reported that about nine officials from the Civil Aviation Authority worked for the Airlines during the strike. This haphazard movement of individuals from the CAA to the Airlines has been attributed to the problems experienced in the industry after the Dispute especially the airplane crushes that resulted after. (Curlews, 2004) The role of the Industrial Relations Commission (IRC) cannot be ignored in this dispute. This is because the latter body is responsible for solving disputes in a neutral and non partisan way irrespective of the governments, unions or employers’ positions. As it had been stated earlier, the Pilots’ federation had grown accustomed to negotiating independently with their employers and they wanted to maintain a similar position during the 1989 strike. In fact, several reports have asserted that members of the federation wanted no external interference. Such a stance infuriated commissioners at the IRC. They wanted to make a statement to the striking pilots and therefore arrived at punitive measures against them. This kind of behaviour was very unbecoming for such a reputable national organisations. Members of the IRC are required to act impartially irrespective of their opinions and beliefs concerning the matters being discussed. This group therefore prevented sound resolution of the matters in the Dispute because the pilots were treated as underdogs. For instance, the IRC decided that pilots’ awards should be eliminated and individual contracts (which were quite troublesome) be introduced. The IRC also decided that they would not listen to the party claims being made by the pilots and this was very extremely unprofessional. The former action (reinstatement of the award) was extremely detrimental to pilots at that time because it put them under a deadlock. The terms of the award were unreasonable and made it extremely difficult for pilots to operate. In fact, this decision by the IRC went on for years because it placed pilots at a loose - loose situation. The IRC failed in their mandate to fully understand the issues surrounding the dispute because their implications lasted for years and years. In fact, one can assert that the IRC was merely a tool utilised by the Hawke government to achieve its goals and objectives. (Holt, 2008) The Government’s pursuit of the Pilots One of the most instrumental figures during this Dispute was the serving Prime Minister Bob Hawke. This individual’s actions had heavy repercussion on how the Dispute unravelled and the eventual effects of the 1989 Dispute. The government through the Prime minister declared war on the pilots at that time. But statistics show that these assertions were not justified in any manner whatsoever. First of all, one of the Airline entrepreneurs and instrumental figures in this Industry Sir Peter Abeles was a close friend and ally of the Prime Minister. Consequently, one can argue that the prime Minister’s stances and actions were guided by the need to propagate the opinions of his friend Abeles. The latter individual was the Managing Director of the Australian Airline Organisation. The government’s actions through the Prime Minister were also propagated by the fact that this leader had played a central role in initiating the ‘Accord’. This individual felt that in order to propagate his legacy then there was a need to protect his brainchild. Besides that, analysts have also asserted that the latter individual found himself in a position here he could not retract from his previous public utterances. During the Dispute, the Prime Minister asserted that the profession of pilots had been degraded and that there was a war to restore back dignity into this profession. This comment had exactly the opposite effect in the Dispute. The Prime Minister had assumed that the pilots would be intimated by this hard line stance and therefore choose to back down. Instead, the pilots got new motivation to revise their demands in the Dispute. Prior to the Prime Minster’s comments, the pilots merely wanted better pay conditions. However, after the Prime Minister’s comments, pilots now became more progressive. They also wanted to change the profession of pilots and decided that they would do this when united. Therefore, the government’s negativity was such that it created more and more solidarity among the pilots. (Paterson, 2008) The government’s leadership also found that it was stuck. It was finding it incredibly difficult to pursue their hard-line stances because they were slowly loosing public support. The public and the pilots themselves felt that the government was trying to degrade the profession of pilots. Consequently, the matter became adversarial in nature. The government could not back down from its former position yet it realised how difficult it would be for the pilots to operate under the conditions of the Accord. Its leader – the Prime Minister could not show the nation that he was wrong and therefore opted to support Airline Companies. Upon analysis of this course of action, it can be argued that there was ineffective leadership within the government as it chose a partisan position rather than the best way out for the Dispute. The government was therefore not justified in its pursuit of the pilots because it was using these striking pilots as a platform against which they would pursue their political interests. Whenever a leadership indicates some form of partisanship, then it is safe to say that the leadership has actually failed. In fact, when the Prime Minister declared a national emergency (the Pilots were frequently bugged) it indicated how far the latter group had sunk. The latter statements can be supported by some of the actions that the government opted to take during the dispute. For instance there were no negotiations that were made between the Pilots’ federation and the government as blank policies were merely passed without any consultation. This kind of action was quite peculiar as the government had been confronted with other disputes but it had never opted for outright refusal. The government also demonstrated its partisanship by the fact that it refused to acknowledge the legitimacy of the Federation of Pilots. It claimed that the latter group did not represent them and that there was no need to respect or listen to anything that they had to say. Eventually, the latter group asserted that the government was trying to coerce the pilots into going back to work through individual contracts that were favourable to the former than the latter. (Holt, 2008) Conclusion There is no doubt that the 1989 Australian Airline Dispute was one of the most detrimental labour issues ever to confront the Australian economy. This is because almost all parties lost in this struggle. First of all, pilots lost their independence or ability to negotiate with their employers through their federation and others even lost their careers. On the other hand, Airline companies lost substantial resources i.e. both human as well as financial resources. This meant that their management representatives were perceived very negatively and they also lost very valuable employees to international Airlines that eventually took them up. Labour organisations were ineffective and lost pubic confidence. Lastly, the government was also seen in a negative light owing to the partisan way that it handled the Dispute because it was “out to get” the pilots. References Wailes, N. (1999). Reinterpreting the 1989 Pilots Dispute. Retrieved 22 September 2009 from http://findarticles.com/p/articles/mi_hb3024/is_1_10/ai_n28738879/pg_10/ Curlews, D. (2004). The Australian Pilots Dispute in 1989. 13 May 2004 Retrieved 22 September 2009 from http://www.takver.com/history/index.htm Paterson, A. (2008). A pilot’s perspective of the 1989 Australian Pilots Dispute. Retrieved 22 September 2009 from http://www.vision.net.au/~apaterson/aviation/ Holt, D. (2008). Dispute Chronology. Retrieved 22 September 2009 from http://www.actu.asn.au/ Read More