The latest wages data, election strategy and #changetherules

New wages data and what it might mean

On Wednesday (November 14th) the Australian Bureau of Statistics (ABS) released its quarterly update on the Wage Price Index . This is one of several means of “measuring” changes in wages. The Reserve Bank considers this and other measures when working out what it will do regarding interest rates. The data triggered a cautious (usually), positive vibe across mainstream media and economic commentators.

What is happening (or not happening) with wages also affects the campaigns for the national elections, due by May next year, and the considerations of the Fair Work Commission (FWC) in its Annual Wage Review (AWR), now under way.

Possibly the only hope left for the survival of the LNP government is that, over the next few months, it wins the “debate” on the state of the economy. The government and the employer organizations are seeking to convince a majority that that the economy is going well on the key economic indicators, and the government is doing well on that front.

There are at least 2 critical weak points in this story. First, what happens if the economic crisis starts to takes visible shape before then? Second, when will wages and salaries start to rise and how much of a rise will be tolerable enough to convince a majority of voters that the government is managing the economy to include “something” for them?

Modest wage and salary increases will be sold to the public that a) the government and its neoliberal agenda is still working on the “things that matter”, b) that “the market works”, and c) there is absolutely no need for any significant change to the repressive, anti-worker Fair Work Act 2009 (FWA09).

Of course, the managers of the “system” – the Reserve Bank, the Treasury, and the government, and employer organizations – do want an uplift in wages, as long as it does not go too far. They know that, right now, the ACTU’s #changetherules campaign is steadily winning the public debate about inequality, poverty and wages suppression.

So, what did Wednesday’s new data really show?

A closer look shows how serious the underlying problem is … from the point of view of workers.

We should also keep in mind that, like other measures of wage movements, the reported WPI data includes executive salaries (not including bonuses). Executive salaries are much higher and are increasing at a faster pace than the real wages of real workers.

Thus, the reported average is higher than the average for real workers. For them the situation is worse than it appears in the reported data, although just how much is difficult to quantify. Further, the ABS’ treatment of changes in the quality of work makes the real WPI lower again for real workers.

Also, this data is not broken down for men and women.

My first snapshot

This chart shows the WPI increase over 5 different time periods. These are the trend figures; that is, the most reliable.

The first column shows the average of the percentage quarterly increases since this data was started in 1997 through to Wednesday’s release. 1997 is the first full year of the Howard government.

The next and following columns, starting in Dec’06 show the average over consecutive 3 year periods. 2006 is the last full year of the Howard government.

The Rudd Labor government, under Julia Gillard’s leadership as Minister, introduced the FWA09 in 2009. The FWA09 is covered basically by the last 3 columns.

The trend is obvious.

My second snapshot

In this second chart we can see what is happening in 3 selected industries: mining, manufacturing and construction.

This chart takes the financial year data (quarterly is not supplied) and is “original;”, that is, not trend. As far as I can tell there is not a big difference in the “original” and “trend” data for the WPI. (Charts can be provided for other industries, on request.)

Again, the trend is obviously downwards.

Wages, Annual Wage Review and the #changetherules campaign

The AWR 2018-19 is now under way and pretty soon the ACTU will probably announce its claim, if last year’s practice is anything to go by.

The slight uptick in the WPI, as reported, is generally attributed to the last year’s 3.5% AWR increase that started on July 1st this year. But that 3.5% was less than half what the ACTU was seeking and, what is necessary to lift the minimum wage above the poverty line. (Enterprise bargaining increases were not decisive.)

Wednesday’s WPI data confirm the validity of the ACTU’s “living wage” objective. However, will the ACTU, and its member unions, seriously mobilise its growing #changetherules movement to struggle for that objective with public actions and demonstrations? Or just leave it to its advocates?

Will the ALP’s election strategy affect the ACTU approach and, if so, how?

The next economic crisis … are we ready?

Tricky questions for activists and their leaders

Mid September is the tenth anniversary of the collapse of Lehman Brothers, the American transnational “investment” bank. Some say the collapse was the real signal for the 2007-9 financial and economic crisis that spread quickly and globally and, ruined the lives of millions of workers around the world.

What appeared to be the cause was the USA’s sub-prime housing loan default contagion. But that left begging a simple question: what was happening to the real incomes of so many workers that there was no choice but a sub-prime loan for a house to live in?

In Australia, the new Rudd Labor government, elected in 2007 off the back of 2 big campaigns, the Your Rights at Work Campaign, and the campaign for government action on climate change, inherited the management of the crisis, as its contagion spread through 2008-9.

Since then, in the period of “recovery”, rising inequality, driven by legalized wages repression, and dramatically deteriorating living and working conditions arising from climate change have occurred. For the majority everywhere it is as if there has been no recovery.

What does it mean that 21st century capitalism cannot deliver equality and environmental renewal even when it is “recovering”, or “not in crisis”? Is there any evidence that there is a capitalism that can exist without crisis?

Its possible, probably likely, that the next economic crisis is not far away. Especially in the light of Trump’s trade wars and his destruction of debt free spending power in the USA. And there are the dramatically worsening effects of the climate change crisis that interacts with that.

In Australia, the next global economic crisis may coincide with a new government that says it will break from the “trickle down economics” that is helping to bring it on.

What will the next crisis do to inequality and environmental degradation? What will the twin crises do to the lives of tens of thousands whose circumstances have been worsening while the extreme rich get richer?

Other questions flow. Should we pretend that its not going to happen? Can the crisis be averted? And, what will it do to the growing Change the Rules Campaign especially its key demands for new and “fairer” rules that enable workers and unions to reverse inequality? Can campaigning organizations prepare for such events so that the momentum they have been building is not lost? Can crisis be used to increase momentum for deeper and more meaningful change?

Such questions are relevant for all organizations and movements of the people against the “powers that be” and their government. Unless the preference is to pretend or hope that it won’t happen.

How do we know there will be another economic crisis soon?

The key word is “another”. Big economic crises are intrinsic to the way in which capitalism works, including contemporary global capitalism. They come along every 7 to 12 years and then leave in their wake millions of people whose lives are more or less impoverished by them. Experience, not just statistics but those also, tells us that recovery is for the few. Increased impoverishment contributes to the next crisis.

What was done in 2007-9?

Governments “dealt with” the crisis in various ways. Transnational corporations and global banks worked closely with governments to get a “make the public pay” policy working.

In response, Obama, governing “the home” of the crisis, dirtied his nappies by rescuing the big end of town.

In Australia, Labor’s Rudd-Swan-Gillard team applied a minimal Keynesian style solution that softened for many in the Australian 90% the worst effects of the crisis: immediate government spending and a bank guarantee. Their approach inflicted little, if any, pain on those in the 1-10% who were the protagonists in the processes that gave it birth.

Just a few years later Abbott and Hockey created their ongoing solution: harsh austerity. They were rejected for that but, under Turnbull and Cormann, this approach is not yet defeated.

And the next time around?

The next crisis will not be good for the vast majority of Australians. Some will cop it worse than others and, worsening climate change will add to an even more desperate plight for the 90%, far more than the 10%.

More specifically: what will happen to wages and inequality? To job security? To Newstart and other social security payments? Will there be new cuts to public education, public transport and public health care? Will there be development funding controlled by First Nations communities to replace the racist, bureaucratic controlled CDP? And the nation building character of the Uluru Statement? And what about the serious problems we all see in parliamentary democracy?

We know the current government, because it has the form and the genetic make-up, will insist on more austerity to far more than those suffering from it since 2008-9. Actually, there is no sign the Turnbull government is making specific preparations to prepare for the next recession. Admitting that a crisis is building would acknowledge that they have not been managing the economy very well. Their mantra that they, as an LNP government, are more competent to handle the economy better than an ALP (plus Greens?) “alternative”, was not true of the last crisis.

Labor as an alternative government?

If there is a change of government, the ALP and its co-governors (cross-benchers) will inherit (again) an economy in or about to enter crisis, through no direct fault of their own, and the massive task of climate change reversal.

As the alternative government, the ALP would prefer that the crisis hits before they win government. Then they can blame the LNP for it.

What will and should they do? Should they repeat the 2008-9 formula but with improvement (remember “pink batts”)? In whose interest should they govern? What will the powers that be in the Business Council and other employer organizations expect of them?

What about unions and “Change the Rules”?

What should our union movement prepare for and demand? Is the prospect of crisis union business? Is this the business of union members? Are our union leaders actually on to the problem?

Right now our union movement is investing primarily in a massive effort to bring down the Turnbull government, especially through the “on the ground” field campaign in marginal electorates through the Change the Rules Campaign. The ACTU trialled the campaign in the recent by-elections in the seats of Longman and Braddon. Without these union driven Change the Rules Campaigns it is arguable that Labor would not have held these seats.

The spread of these campaigns to other electorates is strengthening.

It is likely that a Labor government would push extra reasons for minimal changes only to the broken rules of the Fair Work Act 2009?

How much should our movement accommodate this, if at all? Is this just a decision for key union negotiators, as in 2007-9? The employers will expect moderation. And the “lefty” Deputy Leader of the ALP, Anthony Albanese, says Labor must work better with business. In 2007-9, as Workplace Relations Minister, Julia Gillard brought the employers into the consultation process on an equal footing. Together the spirit of consultation produced the “broken rules” that have hamstrung the workers through the years of “recovery” since. Through Albanese, is the ALP in 2018 setting itself up to repeat the dose?

Some final points: sleep walking or pro-active toughening?

Australia is a middle sized capitalist economic power. Anyone who believes that we don’t have much to worry about because of strong “growth” in the USA, continuing strong demand from China and new market possibilities in India is deluding themselves.

The character of the next crisis will be shaped by three forces, the first of which will shape the other 2.

First, from within the intrinsic global instability of the system, the contagion might start from within the financial sector again. Or, maybe from even deeper economic processes that are dependent on human labour power. The USA, again, might be the source, or somewhere else. Trump’s deliberate trade conflicts might add specific characteristics that were not so relevant 10 years ago.

The government of the USA and its interactions with “Wall Street” and other transnational corporations will be significant. What will the most powerful transnational corporations demand? Will they intervene modestly, deliberately allowing “the market” to clear out its blockages? Or, will they approve a mild Keynesian type stimulus, based on increased government social spending and money supply, especially in a form that protects their wealth and control.

Third, there will be the response of the organizations of the 90%, the working class – unions, leftist political parties, environmental, women’s and anti racist movements, and their various organizations.

Will these they allow the crisis to run its course, complain loudly, and “trust” in government to manage the process? They might advocate modest intervention in which tripartite processes of working together see it through?

Or will they intervene – put the people’s pressure on – to oppose the core dynamic of the crisis, and any tendency to resolve it by making the 90% suffer for it? What will be the demands that would make a people’s programme that protects the people”? How might such an alternative programme and effective strategy the developed?

This can only start by acknowledging how real the threat of crisis is in the first place. And behind the economic crisis there is a class based political power? Would a crisis pregnant with the possibility of new people’s power in government be encouraged? Or dampened?

From the superficial to the real “real world”: underemployment, wages and the future for the majority

Don Sutherland, June 2018

I like The Guardian Australia’s Greg Jericho’s work and, as some of you may know, I share it around quite often. This piece maintains his high standards with clear information that we can all work with in various ways, including of course in the activities of the Change the Rules Campaign.

It includes this:

“It is not migration numbers per se that is the issue, but that temporary workers brought in are being done so by companies seeking to ensure lower levels of unionised labour and higher levels of non-permanent staffing, which combined reduces the capacity for workers to argue for higher wages.

In effect the system is changing to keep underemployment high in order to ensure that wages growth remains low.

And that is just how businesses like it.”

Nevertheless, there is still something missing in Greg’s approach. And this often crops up when you think about it. (It’s true also of the approach taken by the work of the Australia Institute and its Centre for Future Work, darlings of many in the labour movement, Per Capita, and the Evatt Foundation.)

In this case the pretty obvious missing bit is the simple question: “Why is it that ‘businesses like it’ like that?” That is, why do they like a high and not declining underemployment rate, associated migration numbers and low levels of unionised labour. We can add why do they like deliberately created labour laws that prevent workers from effective combination, effective unionism and effective bargaining for a better deal.

The answer to this question is for some reason tricky territory.

It is all about profits and profitability. Profits and profitability are clearly not where the employers want them to be. Getting them to a better level, especially profitability, requires extra exploitation of the workforce and this is made more possible by unemployment and underemployment being a “discipline” on workers alongside of the penal powers aligned against them in the Fair Work Act 2009.

So, there is a “logic”, although perverse, to the current situation.

Challenging that logic means you are challenging the logic of the society, the system that we live in, not just work in. Ignoring that logic means that the real-world working of the system of exploitation continues. It’s more important to prevent discrimination but not exploitation, rather to tolerate it.

Greg Jericho is not the only one to fall short in analysis. Along side of him last week the Reserve Bank Governor gave a speech to a mob of manufacturing employers (brought together by their ‘union’, the Australian Industry Group). He covered similar territory to this and other articles by Greg Jericho and, he also did not discuss profits, at least in his published speech and in newspaper reports. (There was a single and anodyne reference to “wages and incomes”.)

Of course, its quite possible that there was some discussion about profits that is not revealed in the media reporting or in the Governor’s published speech, but we don’t know about that.

If the Governor did not discuss the problem of profits informally then he would have been the only person in the room not thinking about them. Put 100 or 1000 employers in a room and the ones NOT thinking about profits will be the ones going down the toilet pretty soon.

The Governor did discuss new investment and noted the recent lift in investment. However, he was at pains to point out that much of it was not in equipment but in software and the like and he is aware of the limitations of that type. He urged more investment in new technologies by more firms. Some, he said were doing it quite well, but too many were not. All is couched in terms of productivity but of course the real benchmark is profitability. Productivity is not fundamentally about anything but profitability … in the current system. If there are any temporary positive side effects for a part of the workforce they also have their value.

Sounds like good advice from the Governor, yes?

But for most workers, it’s a problem that works like this: new technologies are a capital investment that for a time will reduce profitability … unless the rate of exploitation of the workforce is maintained and even increased. And that’s where the FWA09, especially it’s dispute settlement and bargaining laws at both the enterprise and award levels, works so well for the employers and the champions of the system like the Governor of the Reserve Bank.

It’s also about competition: getting the competitive advantage that beats your competitor and may even lead to a successful takeover of her. What that might mean for the workers employed by winners and the losers is irrelevant or at best of collateral concern.

That’s why the Governor’s whinge about wages suppression is crocodile tears – appearance and system management a la the World Bank – and that’s why he does not endorse the Change the Rules campaign.

It’s also why the parliamentary Labor Party and some of the laborist controlled unions want to restrict the scope and effectiveness, and the full potential of the Change the Rules campaign. Especially when it comes to the right to strike and the right to bargain collectively for improvements to industrial awards.

What does it mean when you are, or you become a union member?

By Don Sutherland, 23rd March 2018

How does a non-member join their union?

One convenient way to do it is to use the ACTU’s on line joining up tool: .

Why are these questions relevant right now? (If not directly for you but certainly for people you know.)

There are several reasons.

In no particular order of significance they include: every Australian worker is exploited during their hours at work and they experience that as low or downward pressure on their pay, and pressure to work harder, to do more in less time; the progress of the case for an annual wage increase for at least 2.3 million workers on low wage rates; the overlapping ACTU (Australian Council of Trade Unions) publicity campaign against the broken rules of the unFair Work Act 2009 (FWA09); the revelation of dodgy and very low pay rates for Uber drivers and others in “gig jobs”, and the collapse of enterprise bargaining as a vehicle for solid wage increases (See below for a little bit more on each of these reasons.)

In a broader sense bigger and more member-driven unions will make a difference in the campaign to reverse rising inequality and poverty by winning better pay increases and establishing new rights.

So, what might your (new) union membership mean?

Well, it might mean nothing at all. You are a passive member who simply holds your union “ticket”, maybe with some idea that it is an insurance policy that you hope you won’t need in the future.

Two questions arise, “Should you stay a passive member?”  And, “What might be being an active member actually mean?” (Especially if your employer is hostile to union members.)

If your employer is hostile to union members (familiar to most workers) you can bring your membership to life to your own advantage without the employer knowing you are doing so.

Clandestine membership is sensible, even recommended, until you and your work mates judge you have the strength in your workplace to make it unnecessary.

Being informed as the basis of being an active member

The first thing that can bring your union membership to life is to become informed, including from your own initiative.

You can pay attention to union news and read the material that is available at your union’s web site or Facebook page or is sent to you through your letter box.

You are an informed member through your own action. And your boss does not know.

Being informed: the next step

You can take “being informed” to a higher level by learning about your workplace minimum entitlements (and those of your workmates). Non-members can do this also.

The legally minimum standards on pay, conditions and rights are described in the FWA09, your relevant industrial Award, and your Enterprise Agreement (if you are covered by one). There are also minimum rights in Health and Safety and Equal Opportunity laws, but these will be discussed in a separate, future post.

As a member or non-member, you can obtain a copy of the minimum pay and conditions of employment for your job that are described in the National Employment Standards and in your relevant Award, and in your enterprise agreement if you are employed under one. All of these are public documents. (Remember your boss can provide better than the minimum “voluntarily” or through an enterprise agreement. A “voluntary” better deal can be taken away whenever your boss decides to.

You can read the National Employment Standards as defined in the FWA09 here, and you can access your relevant award here.

(If you want some help to find the Award that is relevant for you then contact your union or the ACTU, or even write to me at .)

Guess what? Being well informed about your minimum rights at work will make you feel good. Given the importance of work (even when we hate it) in our lives, the amount of time we spend trying to get there, and just being there, it’s a great feeling to become more intelligent and confident than you already are.

Becoming informed together – feeling even better

You do not have to be a trained lawyer to understand the information identified above.

For decades workers have learned how to read and understand awards and another standards a) by doing it, and then b) by doing it together. (Often without the boss knowing … at least until it was agreed that it was time to “come out”.)

Once you have informed yourself about the NES, your Award, and your Agreement (if one applies to you), you can work out who among your work mates and friends you want to share your knowledge with.

You will know who it is, but, and you already know it should be someone you trust. It might be just one other work mate, or you might be in a situation where you can start with several or even more than that.

Then, you sit down with your trusted workmate(s) and show them the document (the Award, the NES or the Agreement) and, together, look closely at the bits that are relevant to your workplace.

You make your own judgement about how strong your case might be to FIRST get more support from other workers and eventually to discuss the issues with your boss, or with a paid union organiser.

You are in command of your knowledge and your case. You can also decide whether you want advice from a paid union official.

Conflict with your employer?

This is a real issue, because conflict is embedded in the employer – worker relationship. It all depends when and how it rises to the surface. Your boss employs you and your mates because your work effort delivers the total income, and within that the profit, that he or she is in business to make. The lower the price of your labour or the harder you work the better for the profit objective.

One thing is for sure, every employer has some way of discussing with their peers, even if they are in competition with each other, what the price of your labour is, and any new ideas around to push it lower, and get away with it. So, when they learn as they do from a competitor about how they can pay lower, including below the legal minimum, or dodge a health and safety requirement, they will do so. (Honourable exceptions there might be, but’s all they are.)

If your boss disappears to the golf or bowls club once a week to catch up with other employers you know what they will be talking about, and it won’t just be the state of the greens.

Getting even more informed – feeling even better but pretty sober also

Sooner or later every boss uses the “competition threat” to push back your wages, conditions and rights.

Smart workers who want to protect and improve their wages and conditions need to know who the competitor company is for the one they are employed by. There might be several.

Once you know, the next step is to work out what the pay rates and other important standards are in the competitor(s). There are lots of ways to get this information but starting with word of mouth and private conversations is a good start. (Again, we can cover this separately.)

This is where a competent and committed paid union official can be really helpful. In fact, its one of the main reasons why paid union officials were created in the first place … to share good quality information around lots of workplaces in an industry in order to deal with the problem of the “competition threat”.

There is an important discussion point here: who is the “competition threat”? Is it the workers employed by the competitor company? Or, is it the owner of the competitive company?

Almost certainly you will “be informed:” that the workers in the competitive company are having (or already have had) the same experiences that you are going through. They might already have “insights” that will help you and, almost certainly you will have insights that help them.

By being informed you are watering the seeds of solidarity and, that is an extra good feeling.

Here is a bit more on the reasons for “getting involved”.

First, Australia’s Annual Wage Review (AWR18) run by the Fair Work Commission (FWC), is well under way. The employer organisations (for all employers) and the Australian Council of Trade Unions have lodged their submissions about what the 2018 increase should be.

At least 2.3 million workers are directly affected because they are paid at or marginally above the statutory minimum rates as defined by the FWC and by the 120 odd awards that set minimum standards including the minimum rates for a range of jobs within each industry. There are also at least hundreds of thousands paid at above the minimum, but who are not covered by enterprise agreements, who are also affected by the decision one way or another.

One behalf of workers the Australian Council of Trade Unions (ACTU) has proposed an increase of $50 per week, about 7%. (For more information click here and here.) The credible employer claims are to permit an increase of only about 1.9%.

The ACTU claim is unique because it is lodged on behalf of all workers affected, whether or not they are members of their union. It is the only claim that will seek to challenge the poverty that workers on the minimum rates are subjected to.

This claim might lead to pay increases that benefit union and non-union worker alike. Should low paid workers who are not members enjoy a “benefit” enabled by their union member work mates who are in much the same or exactly the same shoes as they are?

The second reason, is the escalation of the ACTU’s “Change the Rules Campaign” (CTR) with a 6-week advertising campaign, followed in May by days of workers’ action.  Click here for more information.

The purpose of the ACTU campaign is to “Change the Rules” in the current Fair Work Act so that there are new and more powerful laws for workers, especially so that workers have more power to improve their take home pay and establish more secure employment.

On Wednesday March 22 the ACTU National Secretary, Sally McManus, delivered an important speech to the National Press Club in Canberra that outlined the purpose, aims and focal points of the CTR campaign.

One focal point is the broken rules for the Annual Wage Review process, that right now make it very hard for workers and their unions to use effective power to support their claims.

She concluded her speech by urging workers to “Join Your Union”. It will make a big difference to the CTR if there is membership growth across the board, as is now happening in some unions.

The third reason is because of what we now know about earnings in the “new economy”, or in “gig economy jobs”.

The latest research from the Centre for the Future of Work in the Australia Institute focused on Uber Drivers and was summed as follows:

The Centre for Future Work recently simulated the net incomes received by drivers working for the Uber-X service – which has come to symbolise the gig economy.  And our findings ratify the public concern.  On average across 6 Australian capital cities, we estimated that Uber-X drivers take home less than $15 per hour after paying Uber’s various fees, taxes, and the full costs of running their vehicle.  That’s well below the statutory minimum wage ($18.29 per hour), and less than half the weighted-average full minimum (adjusted for casual loading, evening, and weekend work) that waged workers in this industry should be receiving.  Underpayment of its drivers is the crucial source of Uber’s price advantage, that in turn has been crucial to its growing market share.  The report called on Australian policy-makers to reform current laws (in particular by clarifying that the concept of “employee” should indeed apply to workers in this sort of undertaking) to ensure the Uber-X drivers – and other “gig” workers – are entitled to the same basic protections as other workers in Australia.

Overwhelmingly “gig workers” tend not to be members of unions. One of the reasons for this is that they have fallen for the nonsense that they are their own boss because they can work when they like. This leaves a simple question: “How do they negotiate for a raise if they are comfy with their status as a self-employed person and work according to an “app”?”

The final reason is that enterprise bargaining, as the mechanism that was meant to enable pay and conditions above the minimum standards, has collapsed. (Please click here.) What happens in AWR’s is now even more important for most Australian workers.

Member or not? Passive or Active?

There are other reasons why becoming an active member of your union can make you a more intelligent, confident and happy worker. We have discussed these previously, along with many others, and we will return to them in future posts.

Also, we have not yet discussed the problems that do exist in our current unions. We can come back to that. Our starting point in that discussion is: as a member you have rights that make unions more democratic than any workplace and any other social organisations.

Unions are not a spectator sport.

How to join:

The National Wage Review is On: What is the Union Strategy?

Don Sutherland, February 23, 2018

One of the 2 most important dates for workers this year is looming. The National Wage Review for 2107-18 (NWR18) conducted by the notorious Fair Work Commission (FWC) gets under way for real on 13 March. This is the deadline date for submissions from interested parties as to what this year’s increase should be.

This is when we might know the exact detail of the Australian Council of Trade Union’s (ACTU) claim on behalf of all workers. Yes, the claim is made also for all of those workers who are not members of unions.

Of course, we will probably also know how much the employers will say they are willing to accept. From our lived experience we know they will all oppose the ACTU Claim.

Will there be a broad public and industrial campaign in support of the ACTU’s claim for a big increase in the minimum wage at the forthcoming National Wage Review 2018? Or will it be the ACTU’s failed “business as usual” approach in which their senior officers present the claim, supported by a small number of worker witnesses, and then politely argue why it should be accepted in the face of the chorus of opposition from various employer groups against it?

Will the campaign challenge the “broken rules” in the Fair Work Act 2009 that define how Annual Wage reviews should address the issues.? Will the ACTU approach represent a serious challenge to rising inequality? Will it transform the endorsement of “defiance” from a concept to an industrial and social strategy?

These are important question for Australia’s union members and the 80% plus workers who have not yet joined their union but whose standard of living will be determined by the outcome of the review.

4 Reasons why these questions are important?

First, the evidence is getting stronger that wages have been and are still being suppressed to such a point that this is a factor in rising inequality.

This evidence has been publicly discussed for at least 15 months now and led the ACTU to announce in October (check) last year that it would pursue a claim for an increase this year (the 2017-18 Review) to the statutory minimum wage based on the concept of a Living Wage, not a “minimum wage”.

Although the ACTU had not finalised its claim at that time, this idea would envisage a claim that would take minimum pay rates to around 60% of the median wage

The lowest paid would go up to $738 based on a median of $1230 (the data at that time): that’s an $80 a week increase.

Second, a recent media release (18/2/18) from the ACTU (Assistant Secretary, Scott Connolly) complained again about the state of wages in Australia, as it should. Connolly was responding to the latest information from the Australian Bureau of Statistics (ABS) that showed a tiny increase the wage price index, inadequate for what is needed right now.

However, the media release said nothing at all about the NWR18 or the ACTU Claim. Another opportunity squandered for much needed public education about what the ACTU has been on record about.

Then the next day, in a major speech, the ACTU Secretary made only the slightest general reference to National Wage reviews and said nothing specifically about NWR18 or the ACTU’s claim. This is quite surprising.

McManus said, in registering again one of the chief complaints against the Fair Work Act 2009 (FWA09):

“Unions can make submissions on award reviews, and they do. Unions can make submissions to the Minimum Wage Review, and they do. But those roles are marginal.”

In the list of new laws she includes: “provide a living wage for all”. But no elaboration.

Third, the ACTU, its constituent unions, and more importantly Australian workers, are fast running out of time for such a campaign to be developed and for it to have a new and dynamic influence on the wages struggle.

Yes, there is a wages struggle. However, right now the wages struggle is hidebound as a public “debate” that sharpens occasionally when a group of union members hit the headlines in discrete, atomised and bitter fights over wage increases, and other issues, in bargaining for a new enterprise agreement.

This form of wages struggle repeatedly reveals its limitations. As essential as it is, it is not tackling rising inequality and poverty.

The FWC describes the Annual Review process at its dedicated web page for National Wage Reviews: please click here.

This includes the Fair Work Commission’s current timetable that provides a number of dates that could be focal points for broad union and public action, including 9 April when replies to the first submissions are required and “Final consultations” on May 15-16. (The FWC has also published the statistical information it considers necessary to work out what the outcome should be. Please click here.)

Therefore, union members and potential members are entitled to ask, “What is going on here? What is the ACTU up to?”

 Why is the National Wage Review so important for workers?

Under the current broken rules of the FWA09, and the socio economic system in which it fits, workers can get pay increases from any of 4 sources.

The first source is when, “like Oliver Twist” they beg for more and the boss “out of the goodness of his heart” gives them something.

The second is when there is a shortage of the particular knowledge and skills that the boss needs and so she retains or attracts workers with those qualities with higher wages than those previously available.

The third source is through enterprise bargaining increases. However, we all know that enterprise bargaining as a source of pay increases is falling apart and shows no signs of reversal. The FWA09’s “broken” enterprise bargaining rules determine that.

Thus, the pay levels of the remaining enterprise agreements shift closer to the minimum rates in Awards that are themselves determined by the broken rules of the National Wage Review.

The Annual National Wage Review is the fourth source. But, under “the broken rues” and established “strategy” the awarded annual pay increase is always well below what the ACTU claims on behalf of the whole workforce.

That is why previous Wage Review decisions are a factor in establishing the trend to greater inequality.

Because of the decline in the number of enterprise agreements and the decline in the number of workers covered by them, and the reduced gap between wage rates in those agreements and the minimum wage, and the increase in the number of workers dependent on the Wage Review,  the size of this year’s wage increase is critical for workers living standards.

Thus, it is in the interests of both unionized workers with decent enterprise agreements (a declining species) and non-union workers without Agreements, that there is an opportunity to engage very much more in a public campaign in support of the ACTU claim.

A strategy can be devised for the NRW18 that can attract non-union workers into (re)joining their union, and tackle the problem of wages competition that confronts unionised workers with an enterprise agreement on above average (for now) rates of pay.

The ACTU’s medium term vision showed an answer

Some readers will recall that the ACTU announced late last year that it would seek an increase to the minimum wages in this year’s Wage Review that would lead to a “Living Wage”, as the new minimum wage.

It released a report that explained the concept of the Living Wage and its logic for current circumstances.

However, up to the end of January there had been very little to zero education effort to explain this objective, and its great significance for workers, to union members or to the broader working class.

For example, this is confirmed by a quick review of the ACTU’s media releases on wages issues and associated rising inequality. (See my end note.)

Implications … what is the ACTU Executive up to?

I am putting the emphasis here on the ACTU Executive not just Sally McManus or any other specific national official of the ACTU. It is the ACTU Executive, mainly national secretaries of the ACTU’s member unions, that sets the parameters for what McManus and other leaders are able to pursue and promote in the public battle on behalf of all workers.

If there is to be no attempt at a campaign there needs to be a serious and clear explanation as to why.

Because what that means is the ACTU Executive has decided to continue with a failed strategy and, in doing so, to meekly comply with one of the most serious of the “broken rules” of the Fair Work Act 2009.

It is discarding any serious intent to be defiant. “Defiance” thus lives as a word to get a headline that registers a complaint. The encouragement of defiance, as part of every workers’ heritage, does not represent a commitment to a “new” strategy relative to that which has been pursued for the past twenty odd years. It does not commit to a strategy that enables workers themselves to learn, as a combined movement, how to win their battles, and shape their history as their predecessors have done in working class and union history.

In its own way, the most recent media release referred to above says something about the problem.

“The latest wage price index figures show that working people need more power to negotiate pay rises.”

“Working people need more power”? Well, that leaves begging how power is acquired and what it is that expresses the power that is “needed”. Is the ACTU waiting for someone to give “working people” more power? Maybe, they are waiting for a new Labor government to give working people more power? Do they expect that a Labor government will give more power to working people without pressure and power being exerted upon them? Do they assume that union leader lobbying and negotiating skills will be enough power to ensure that “working people” acquire power that they “need”?

Ultimately, the power that working people “need” is the unrestricted right to withdraw their labour. But this “power” is rarely granted, even though it is a human right. Most of all, this power is learned in the doing of it (especially for workers who are not used to grasping it) and that requires a very different strategy to the one that has failed in the past. The more defiant is the “doing of it”, the more it is that workers learn about their potential as a class and the more they attract other workers to support them and join in. This is not a “vanguardist” approach in which leading groups of workers act in heroic isolation without any thought to how their action will attract more into the struggle.

Rather, a “struggle” strategy can be developed in which power is exercised to the extent that is possible, is still defiant and is shaped to make sense to those who are not ready to join in but will do so next time. Power is taken bit by bit, and sometimes the bits are bigger and more decisive.

Above all, the phased increase in the exercise of that power by “working people” pushes the employers and the government and the FWC into a defensive position. A vital part of this is union education: not just through formal classes but in all sorts of ways, including learning and “critiquing” by doing.  The best union education is that where learning is acquired in action developed over phases that attracts during each phase new participants into the struggle. A National Wage Review campaign of this type will make sense to non-union workers and can be structured to appeal to other parts of the population also.

Union Members and Activists … what can they do?

Union members and activists have 2 broad choices. One is the current practice: leave the issue of strategy to the union leaders, the “wise heads” who “know what they are doing”. This includes joining in to support workers who are active in those bitter enterprise bargaining and similar disputes, knowing that as brave and courageous as they are, they are not ultimately a winning strategy for working people as a whole.

Another, is to decide to intervene themselves, individually and in groups, to exercise their rights as union members to set a direction for their leaders to lead from.

The second of these will be welcomed by some union leaders while others will not be comfortable and will push back against it. How to develop that strategy needs to be discussed more widely. There is a lot at stake.

End Note: Recent ACTU Media Releases about wages and inequality

Enterprise Bargaining – Not just “Broken”, but Rotten to the Core

Recently, I discussed Australia’s “broken” enterprise bargaining laws with Caroline Pryor on Radio Skid Row’s “Workers Radio”. Click here to listen. These “broken” laws are stacked against workers and are an essential element in driving more inequality in Australia.

Later that day, Australian Council of Trade Unions (ACTU) Secretary, Sally McManus, gave an important and revealing keynote address to the T.J. Ryan Foundation in Brisbane, Queensland. (Click here to read the released version.) McManus described increasing inequality in Australia and how the Fair Work Act 2009 (FWA09, the “rules”) is contributing to that. Also, she specifically talked about the enterprise bargaining rules that are stacked against workers.

In this post I include information not covered in the radio discussion, focus on just three of the broken enterprise bargaining rules, and discuss what the Australian Council of Trade Unions (ACTU) “Change the Rules” campaign should prioritize.

In Australia, wages and conditions, and limited workers’ rights are established in 4 interactive ways:

  • the FWA09, including National Employment Standards,
  • minimum rates of pay that come from the Fair Work Commission’s annual wage case,
  • industrial awards (also managed by the FWC) that set additional minimum standards on a range of matters from industry to industry, and
  • enterprise agreements that are negotiated between workers and their unions and employers at the level of the enterprise that can set standards above the minimums in awards and the statute.

What’s happening in the real word?

Right now, all across Australia there are dozens of enterprise bargaining disputes in which workers are learning that the laws are stacked against them and its time to “Change The Rules”. (“Change the Rules” is the name of the overarching campaign coordinated by the ACTU to replace the broken rules with new ones that are fairer for Australian workers.) These enterprise bargaining disputes include complete and partial lock outs, successful and pending applications to terminate enterprise agreements that push workers onto the minimum wages and conditions in their award, and long term delays by employers to bargaining timetables.

And, enterprise bargaining itself is on the wane:EB wanes 0917a

Fore more information across the whole workforce and economy click here.

Enterprise bargaining is not just broken, it’s rotten to the core

Workers are learning that when their employer moves from a relatively benign stance to a determined and militant assault on their wages, conditions and rights, enterprise bargaining takes a long time and there are many ways in which the employer can make bargaining decent improvements extremely difficult. This is even more so if they as workers are determined to defend what they have achieved and stand together for something better. It “hardly seems worth it”.

For workers there are at least 10 different ways in which the rules are stacked against them, and these start with the core framework of the system. The current enterprise bargaining rules in the FWA09 were intended to be better than the despised laws imposed by the right wing Howard governments “Workchoices” laws. They are barely so and are very much in the same neoliberal ideological framework.

Broken Rule 1: the legal or statutory requirements are complex not simple

Workers are entitled to expect that the rules governing their working life are accessible, straightforward and in plain language. This is not true of the FWA09, particularly when it comes to enterprise bargaining.

The legal framework for enterprise bargaining is in 3 separate sections that require frequent page flipping. The objectives of enterprise bargaining are located separately from the process and other requirements, and are themselves connected to the general objectives of the whole Act that is in another section entirely. Further, how an enterprise agreement interacts with the industrial award and the National Employment Standards in the Act, the industrial action requirements, and other rights and responsibilities are complex.

This complexity provides employers with a range of options to mislead workers about the negotiating process and the content of Agreements. This more so for workers not in unions, and, especially so for workers employed by the same employer across multiple locations.

 Broken Rule 2: The statutory or legal purpose – Labor’s neoliberalism

It is a common mistake to think that enterprise bargaining is meant to provide for better wages and conditions relative to previous Agreements. There is nothing in the relevant parts of the Act that requires enterprise bargaining to produce a better deal for workers relative to previous Agreements. That may happen but there is nothing in the Act that requires it. Rather, the FWA09 establishes the prospect of concession bargaining, depending on other factors.

Even the Secretary of the ACTU gets this wrong. In her officially released speech to the T.J. Ryan Foundation on September 1st, Sally McManus says:

The system of enterprise-based bargaining was meant to deliver increased wages alongside increased productivity.

Well, since around 2000 this stopped happening5. People are working harder and smarter, workers are making record profits for their employers, but they are not sharing in it.

The purpose of enterprise bargaining is laid out in section 171 of the FWA09 and its link to section 3 that lists the Objects of the whole Act. (Click here.)

There is nothing in either about improvements to wages, conditions or rights in Agreements. The core purpose is to “deliver productivity benefits”.

So let’s look a bit closer at productivity – the core purpose of enterprise bargaining.

Every employer is in business to make profit. Productivity improvement is not an end in itself, rather, it is the pathway to improved profitability relative to competitors in the same or potential new markets, and to competitive units deliberately created and owned by the same company, often in other countries.

This core logic is inherently anti-worker. Every worker (and every employer) knows that a competitor who pays less to workers with weakened bargaining powers will put downward pressure on their own wages, conditions and rights.

The best way for workers to deal with this is, of course, to combine and connect with each other; to form and join unions across employers and industries; to act in solidarity to bring those weakened workers up to their standards instead of being forced into a race to the bottom.

For all practical purposes, “productivity” improvement is code for “profitability”. Profitability improvement comes by increasing the rate of exploitation of workers. Thus the purpose of enterprise bargaining takes workers and their unions into dangerous acceptance of the logic of competition and profitability, making wages, conditions and rights dependent on them. Accepting this logic encourages workers to think of workers in other locations and employers as their enemy.

The FWA09’s scheme for enterprise bargaining allows employers to create separate agreements or none at all, thus creating competitive downward pressure internally, as well as the normal competition from other employers. Workers can be isolated from each other in “silos” and it is more difficult for workers to get the support of paid union officials.

Enterprise bargaining is designed in the FWA09 so that any improvement is not because of it but because of other factors:

  • how benign the employer is;
  • the demand for the particular knowledge and skills held by the workers;
  • whether the workers are in a union;
  • whether they are well organised, well informed, and very determined – mindfully militant.

Broken Rule 3: industrial action repressed – capital strikes accepted

In any negotiating or bargaining process, including for enterprise agreements and breaches of them, employers and workers can use (or not) real or latent bargaining power.

The most important power for employers is the strike of capital (or it’s threat); that is, the power to withdraw, reduce, re-allocate, their capital, or threaten to do so. This action always has a big impact on workers in any bargaining process. There are no restrictions on the strike of capital in the FWA09. (Of course, there are other employer powers as well: the right to lock out without any democratic control, the right to hire and fire, the right to use use labour hire workforces, legal assistance to stop strike action, and so on.

The workers’ counter to the strike of capital, to resist being victims of competition, is the withdrawal of their labour or go slow, and solidarity across workplaces.

In the FWA09 workers start from the basis that industrial action is prohibited and is in general NOT PROTECTED from common law damages and statutory fines. (This is, in itself, a breach of Australia’s commitment to international labour law standards.)

A workers’ bargaining representative – union or non union – can apply for protected industrial action status to the Fair Work Commission (FWC). The union/s (bargaining rep) must prove genuine bargaining as defined in the Act. The employer can oppose the application. If the FWC agrees, the applicant can then run a protected industrial action ballot, conducted usually by the Australian Electoral Commission. Only workers who are represented by the union (or the bargaining representative) can vote. There are strict requirements about who in the workforce will be balloted. The employer can influence this by providing a faulty list of their employees who are union members.

The rules about how the ballot questions are put on the ballot paper are technical and strict. Industrial action becomes available for those forms of action that receive a minimum of 50% of the members provided with a ballot paper.

Once the required majority is established, the workers, usually union members, can take any of the forms of industrial action that have been voted up, and they are “protected” from common law damages and statutory fines.

However, they are required to give the employer 3 working day’s notice of the particular action they intend to take. This enables the employer to minimise the effectiveness of the action.

Then, employers can use counteraction in the form of a lock out. They do not have to apply for that right and there is no requirement for a ballot to say whether or not they should be allowed to. If an employer uses the lock out power, they can decide whether to lock out all who have engaged, or target a selected group, and arrange for others to do the work of those who are locked out.

At any time, the employer can put their own proposed Agreement to the entire workforce for a ballot and they can choose the organisation or private company who conducts the ballot for them.

The employer can apply for protected industrial action to be terminated or suspended under certain circumstances.

The employer can also apply (or threaten to) terminate an Agreement during negotiations and these applications now so common they are a predictable bargaining tactic.

Other broken rules for bargaining

These core anti worker provisions of enterprise bargaining are reinforced by a number of other anti worker rules.

These include the employer’s control over the process for informing all workers about the bargaining rights and process; the ongoing process of bargaining and the arrangements that must be made for genuine bargaining to occur, especially in the absence of a union; the ability to ensure that non-union bargaining representatives can participate at the bargaining table and given access to all workers; and employer control of the ballot on any proposed agreement, including that all workers are able to vote and that the result does not require a 50% response. The content of agreements is restricted to ensure that critical issues can not be bargained, for example access to information and communication rights for workers about supply chains and financial performance.

The priorities for the “Change the Rules” Campaign: minimal or ground breaking?

 The ACTU’s “Change the Rules” Campaign is just 3 months old. There has been a lot of education about how the current rules are broken, much of it in the dozens of disputes “resolved”, defeated or still under way all over Australia, including in enterprise bargaining. Sally McManus, the new Secretary of the ACTU has explained the message in social media, media interviews, picket line and action sites, and formal speeches like the one last Friday.

When the Campaign was launched the ACTU provided a list of what a better system might look like. There are 27 specific ways in which the workplace and industrial laws could be made fairer for workers.

Broadly speaking these fall into 3 categories: those that enable workers themselves to exercise their power, including in their unions; workers’ rights that require support from their union, or the FWC, or the Fair Work Ombudsman, and those that are about the rights of such bodies that might flow on to workers.

There has been precious little discussion and education work that enables workers, including union members, to have an effective say in what should be the priority changes.

For workers, the ground breaking changes that will make a real difference, because they are enabled (if they wish) to take matters directly into their own hands and deal with the competition problem, are rights to

  • strike (to match the employers’ capital strike rights),
  • communicate and organize beyond their own workplace,
  • struggle for and negotiate new and better standards relevant to a globalized and digitalised workplace (no restrictions); and,
  • restore Awards as the primary focus for bargaining common standards above the statutory minimums in the Fair Work Act.

Labor’s Shadow Minister for workplace and industrial relations, Brendan O’Connor, is talking up a positive approach on some important problems faced by workers but still remains coy about ground breaking change. He favours an approach where workers are dependent on what a Labor government, or a union or the Fair Work Commission can do FOR workers. He is not yet committing to ways in which workers, combining together, can use power to face their employers.

Sally McManus, on behalf of the unionized workforce and beyond is not yet being explicit about ground breaking change. This is what she said should be the priorities in her speech last Friday:

  1. More secure jobs by taking away the incentives to casualise work
  2. Restoring a strong, fair and independent industrial umpire

  3. Ensuring a level playing field for bargaining

  4. Rebuilding a relevant, modern and strong safety net for all workers

The explicit commitment to the powers of the industrial “umpire” reflects a long tradition of right wing unionism in Australia. Note that there is no direct reference to the right to strike or of Awards as the industrial instrument that takes wages and conditions out of competition. Of course, Sally McManus may indeed have covered these points in her delivered speech or in the QandA that followed.

It is likely that both union leaders and the ALP are uncomfortable or wary of talking about industrial action rights because it is true that there will be an employer and government outcry that will try to whip up opposition to any such changes.

Topical questions for further discussion … soonish?

This leaves begging a couple of questions: when is the right time to educate at the deepest levels of the workforce and publicly explain the unrestricted and democratic right to strike for workers? And, is parliamentary Labor already manoeuvring to make sure it does not happen in exchange for minimal changes only because “that’s the best we could do” and “the public is just not ready for it”?

Will union members and potential members permit this neolaboral approach to workers’ rights in the twenty first century to prevail, as it did in negotiating the Fair Work Act 2009?

Winning back basic industrial rights won’t be easy but it’s time to fight

This is one of the best written summaries of why the ACTU’S campaign – “The Rules are broken – Change the Rules” – is entirely logical (from a worker’s point of view) and should be taken forward in a big way by all of us, not just elected union leaders.

#JeffSparrow says, for example,

“The union movement was founded, almost by definition, by people with no respect for the law – given that the Combination Act of 1799 imposed draconian punishments on anyone who organised against their employer.

“In 1834, magistrates sentenced six agricultural labourers from Dorset to transportation to Australia after finding them guilty of “unlawfully administering oaths”. The so-called Tolpuddle Martyrs – lawbreakers all – are acknowledged as union pioneers in both nations.”

Jeff’s reference to the English “Combination Act of 1799” (1798?) is spot on and entirely relevant to our 21st century challenges.

“Combination” was the world used back then to describe workers meeting together to discuss why and how they could effectively negotiate with their employer for better wages and conditions. Judge made law described such meetings as “conspiracies”. It would lead to imprisonment and also deportation on a convict ship. What the employers did then was “work with” their friends who dominated the parliament to to shift the anti conspiracy laws made by judges into a statutory law.

Creating a union was legally defined as a “conspiracy” against the employer(s). It’s purpose: to prevent workers all over Britain from learning how to combine together to form unions as we know them today.

Yes, the people who created unions were workers who had not yet joined a union. Just like Uber drivers are doing right now, and it appears with the respectful support of the Transport Workers Union.

When workers prevailed and succeeded in winning a better deal – through “combination” not begging for more as a heroic individual as in Dickens’ Oliver Twist – they learned quickly that their “win” might be set back because their bosses’ competitor would be at an advantage. There would be downward pressure on what they had gained if the new standard could not be applied in the “non combined” competitor.

The solution? They had to meet – clandestinely – with the workers employed by the competitor to encourage and teach them how to win the same improvement to wages and conditions.

This is called solidarity organising and the method was learned the hard way by workers’ themselves, although it appears also supported by progressive thinkers in groups like the London Correspondence Society.

Workers had to struggle, not rely on charity, and break the law to create new democratic rights.

The 21st century Australian version of the anti combination laws, contained in Labor’s Fair Work Act, in its own way represses and penalizes workers who seek to act in solidarity with other workers.

That’s the whole framework of bargaining and associated activity that gives a huge advantage to employers over their work forces. The Fair Work Act, and its special oppressive extension in the Australian Building and Construction Industry anti worker and anti solidarity police force, can impose on workers who act in solidarity as in the late 18th century, statutory fines, common law damages and jail terms.

That’s why a fully fledged strategy – including industrial action – is necessary to educate about these rotten laws, to build active workers’ defiance against them, and struggle for new 21st century democratic rights of workers to industrial and other action that can challenge the powers of their employers.

Thats another reason why Jeff Sparrow’s take on this is interesting: the eventual defeat of the anti combination laws of the early 19th century was achieved by the growth of unionism off a very low base. Just like today.

In the 1967 an Australian union campaign that stretched over 10 years defeated the anti worker penal powers that were created by the Menzies government and governed by the Conciliation and Arbitration Commission of the day. That workers’ victory – that culminated in national strikes in 1967 – was achieved on a foundation of relatively high union density especially in big productive workplaces, although the unions themselves were divided with the right wing unions backing a yellow and Arbitration driven approach to workers’ problems.

The only new restrictions in 21st century democratic labour laws that should be introduced are those that prevent employers going on strike with the capital they have taken from the wealth generated by workers in Australia, as many are currently doing.

In our history there is a uniquely Australian way in which respect for solidarity between workers, especially solidarity bargaining for improved wages and conditions, can be restored in a 21st century form.

We will be continuing our discussions of this on 3CR radio’s Solidarity Breakfast this coming Saturday morning.

The real face of penalty rate cuts

Tania is 60 years old. Widowed for almost 40 years, she’s raised three children as a single mother and now helps with the care of her eight grandchildren. Tania has worked at Spotlight in Wollongong for 21 years. She has never had a pay rise.

UK election: British capital in disarray

This is a strong political economy analysis of the outcome of the British election. Michael’s suspicion of another election before the end of the year on the basis of Corbyn’s courageous and intelligent campaign that connected to working people and the young among them drives me to a re-watch of “The Secret State” for clues about what might happen after that. Corbyn’s trajectory at this time is left social democratic but we must have a strategy that defends it if and when it is successful. That would be our big strategic breakthrough.

Why and how the Fair Work Commission’s cuts to Sunday penalty rates can be defeated.

by Don Sutherland, 25/2/17

Last week Australia’s industrial “umpire”, the Fair Work Commission, legalized a big cut to penalty rates for Sunday work for Australia’s lowest paid and most vulnerable workers in precarious work. (Click here and click here for the official summary of the decision.) Implementing the cuts is not compulsory. Anyone who thinks neoliberalism is dying needs to take a deep breath and step into the real world.

Like many others across the union movement and beyond I am very angry on several counts with this decision. Above all it does great harm to the lives of thousands of workers (click here for example), even though it will increase the take home profit of their employers.

There is a lot of material being posted in both mainstream media and in many sources across social media about why this decision is bad, some of it before the decision was handed down and of course a lot since. This article does not add to that.

Rather I focus on ideas about how the workers and union movement can respond.

How should the workers’ movement respond?

In my view not just with anger, but with a widely, deeply discussed and developed strategy to win the reversal of the decision or to prevent its actual implementation.

I am against a “strategy” based on immediate anger that sets our movement up for an urgent, satisfying day out and another “glorious defeat”. And I am also against a defeatist walk into the arms of the ALP as the heroic solution.

Rationale for a strategy

This Full Bench decision of the Fair Work Commission (FWC) comes out of an Award review that is required by the Fair Work Act (FWA). The Award review is very much an industrial relations club exercise. The FWA review involves either union peak bodies or employer peak bodies putting to the FWC ways in which Awards should be changed, with the capacity for others, especially governments and political parties, to join in. The parties present their claims and counter claims, then provide evidence in an increasingly judicial process that involves “expert” research and / or witnesses. There is not much industrial organising that goes on in support of union claims or counter claims these days.

In this current review all Awards are under the microscope. The focus in these particular Awards for workers in hospitality, pharmacy, fast foods has been on their penalty rates, especially the penalty rate paid for working on Sunday.

Employers in the industry and beyond have over several years invested big money and resources to convince the FWC to agree to cut penalty rates for Sunday work. They have been supported by the Murdoch press, a big posse of commentators from right wing think tanks, and all major employer organisations. The union movement has been the major source of opposition. Originally, employers wanted cuts to all penalty rates but decided for a strategic reason to focus on Sundays. Do not doubt that their “victory” last week to get Sunday rates cut is a foundation for a renewed assault at some time in the future for further cuts into both Sunday and Saturday rates and public holiday rates.

While the employers were investing big in their own way to achieve their victory, the workers’ effort – mainly through their unions – was valiant and well-intentioned but puny in comparison. It was entirely defensive, and accepted the rules of the Commission and the Fair Work Act.

The employer strategy successfully used prominent Labor politicians, some of them willingly, and ex politicians (most notably perhaps Martin Ferguson, formerly a President of the Australian Council of Trade Unions).

The employer strategy relied very much on today’s working class  historic memory loss  about what an Award actually is. Nothing significant has been done by unions to counter this with worker education. Australian unions, generally, have opted to devote most resources to enterprise agreements as the vehicle to protect and improve wages and conditions.

Remember, the employers originated and escalated this war on living standards, not the Fair Work Commission.

This very bad outcome is a reflection of the current balance of power between Australia’s 21st century capitalist class relative to that of the working class.

That is the situation that our strategy must change.

A working class based approach to our strategy

Can we build a strategy, loaded with mindful militancy, that can reverse this decision and also the whole current momentum against working people? (Facilitated in the bosses’ favour by the Fair Work Act, e.g. lockouts, agreement cancellations, and the new Building Industry Code to be enforced by the construction industry’s own industrial police force against construction workers and their unions.)

Of course we can. Here are some ideas.

The first big strategic decision for all union leaders no matter what level of the union movement we are active in: should we leave the reversing or whatever of the decision to heroic leaders, those at the “top” of the union movement and especially those in the ALP and the Greens in the parliament? Will calls to the government for the government to change the statute re-build our numbers and our power?

Or, should we return en masse to a conviction that the workers in these industries, and their brothers and sisters in others, can grow together as a socio-political force to reverse the decision themselves through their own industrial and political action?

The union movement at all levels must, absolutely MUST, embrace this second approach. Why? Because we must see workers of the twenty first century as capable of learning to struggle for their objectives not as objects whose conditions of existence are decided for them by elites, well-meaning or otherwise?)

That still means lots of education work and lots of communication that is educational (not cheap slogans or cute and clever memes,) leading to days of action on carefully selected dates. Days of action can be seen as the building blocks to more serious forms of action, including a national strike that can decide the struggle in favour of the workers.

Industrial strategy leading the way

The Commission is now waiting for submissions from the parties about the timing and process for phasing in the new reduced rates. Depending on each award, the critical dates seem to be in late March and early May.

After that the Commission will set dates for the start of the new reduced rates, probably later this year.

So, for example, this year these union / workers days of action might be 2-3 days before or on the day of the “submissions” hearing and then again 3 days before the start date.

Remember, employers can chose not to reduce rates. Embedded in these days of action there must be a workplace, public, social and political demand that each individual employer NOT implement the decision, but infused also with basic education and learning about “what is an Award”, “who are the employers”, “what is their strategy”, and “what is the Commission”. (Of course, many employers will try to “stay sweet” with their workers by telling them that it’s not their fault and they have no choice but to implement it.)

To the extent that it is necessary, a secondary level of campaigning in these 2 periods might help reinforce worker pressure on MP’s to come out at a local level to urge local employers not to implement the decision.

How long will it take to win – the trajectory for winning?

The second big strategic decision is a notional time frame that this campaign will take 2 to 5 years to win. It would be nice to win sooner but expectation that we can – in my view – misjudges the power of those who want this decision against the current power of those of us who oppose it.

We need time for education work and union growth organising to build the power to win. We do not have it right now, just the same as the employers did not have enough power to win their objective in 2007. The employers have understood strategy much better than us and have been ruthless enough against working people and their unions to stick to their strategy and be flexible in applying it.

We have to be every bit as cold and calculating as they have been and more.

Therefore, these days of action MUST be educational and  must be seen as building blocks to very big and powerful actions in the future that will be more decisive.

Our strategy will have to escalate over that 2-5 year period in the spread and depth of awareness among the workers immediately affected and those who will experience the flow on effects of it.

A strategy of this type must culminate with the consequence of economic pain for the employers who wanted this decision and who decide to implement it.

The next award review will be in 4 years or so, possibly less. That is the moment for the first “really big culmination” of our strategy in which employers can face the prospect of real economic consequences for their actions.

Within it there is the opportunity for the union movement to actively regrow from within the 21 st century working class, basing that on education-driven organising of both union members and potential members.

This decision to cut penalty rates is one element of ruling class momentum against all workers … the whole of the working class.

We can add to that the employers threat to re-locate operations to off shore low wage havens, use of lock outs during bargaining, demand for major concessions in enterprise agreements, and refusing to bargain for any improvements about job security or wages or safety, employer applications to cancel agreements and drive their workers back to the minimum wages and conditions in Awards, penal powers against any workers who take industrial action that is not approved by the FWC, and the government’s new Building Industry Code policed by the building industry commission. This is a considerable array of power for employers that is facilitated by the Fair Work Act.

Penalty Rates Plus

Genuine working class power can be built to demand at the next Award review and even before not just the restoration of current penalty rates but also a significant increase in the minimum Award rate, and automatic casual conversion after 3 months for those who want it.

These issues are relevant to all other Awards as well. We are talking about common, multi industry actions to take on common big employment problems.

This will be a campaign for all workers because the huge gap between award rates and union negotiated agreement rates is contrary to the fundamental rationale for unionism, and should not be acceptable to any unionist.

The focus of the whole movement must turn steadily (although not absolutely) to AWARDS and away from enterprise agreements.

Finally, this “ordinarily people” rooted strategy will require that the Fair Work Act (including its penal powers against workers) be defied, and probably broken, and ultimately genuinely re-written for workers’ benefit.

That’s not a reason not to do it but it is a reason for a lot of educational work in preparation.