The Annual Wage Review 2017-18: From Marriage Equality to “Economic Inequality”.

By Don Sutherland (March 16th, 2018)

The Annual Wage Review:  update

This week the Annual Wage Review (AWR18) run by the Fair Work Commission (FWC) that sets new minimum rates of pay moved to a new stage. March 13th was deadline day for submissions from “interested parties”. These include employer organizations, governments, and, for workers, the Australian Council of Trade Unions (ACTU).

And, the ACTU launched its 6 week advertising campaign to highlight general and some specific aspects of the “broken rules” of Australia’s Fair Work Act 2009 (FWA09). (Click here.)

Critically, this advertising campaign will lead into days of workers’ action being planned for May.

We also learned that the unregulated salaries of the Chief Executive Officers of Australia’s top 100 corporations pushed on average well above $5 million per year. (page 12.) These characters are not required to apply for a pay increase to the FWC.

Many of them supervise the attacks on the pay and conditions of their own workforce, using the “broken rules” of the FWA09, and their company’s strategy to pay little or no tax, using the “broken rules” of the tax system.

Between now and April 9th the parties can study the submissions of all of the other parties, and any new economic data, and by April 9 present counter submissions. (For more on the AWR process click here.)

Its all very polite and loved so much by those in “the IR club”. The process is designed to exclude the workers who are most affected by it from exerting any real influence. That is, unless they or a good part of them decide to defy the process.

The claims: what we now know

The submissions have now been posted to the FWC web page (click here) that provides the detail of the progress of the Review. There is a good summary of the main claims here. (Also, Caroline Pryor and I on “Workers Radio” . Radio Skid Row, discussed the claims today: click here.)

The ACTU claim is to lift the minimum rate of pay by $50 per week. This is a 7.2% increase for low paid workers. Make no mistake, there is no one else going in to bat for them like the Australian union movement.

This is a claim made for all workers, not just those who are union members. If you are not a member its time to join. If you know someone who is not a member its time to have a serious talk with them. You can help them join directly at this ACTU page: click here.

For the employers, arguably the most influential employer organization, the Australian Industry Group, wants a paltry $12 per week increase on the minimum rate and $14.60 for the lowest award rates. That’s a 1.8% increase, which is less a than the current inflation rate. In other words, a pay cut. No surprise there.

One of the retail employer organizations wants a zero increase. The other concedes a 1.9% increase, as does the Australian Chamber of Commerce and Industry.

The federal government and the ALP did not propose any specific increase but their proposals were quite different.

The Federal government wants the smallest possible increase and argues that really wages should only increase naturally, that is, their genuflection to the “trickle-down effect”.

The ALP, in opposition, with its nose to the federal election breeze as you would expect, endorses a decent increase but one which is “economically responsible”. If the Commission grants $15 per week as “economically responsible” would the ALP accept that? What would their members say? (The Greens and One Nation have not made submissions or proposals. They both should be challenged on that.)

The arguments against the ACTU’s claim

The union activist army must grow in number and also lift their ability to defeat the employers’ propaganda against the ACTU claim.

So far, in the public arena, these are general “arguments”, and say that the claim is 4 times the inflation rate; will destroy jobs; and harm low paid workers.

These will be sharpened and added to in the weeks ahead. Murdoch’s media will be the prime vehicle to spin them.

They will have to be addressed by the union army of activists in their day to communications with workers, including those who are not yet unionised but who can be attracted to the struggle. The ACTU Submission does deal with each of them. And there is also this: click here.

How can low paid workers win? Business as usual or a defiant mobilization? Or leave it to Bill Shorten’s ALP as a new government?

We need a new strategy based on defiance and mobilization. This cannot be a once off, one year exercise. This year’s mobilization, if there is to be one, must pave the way for 2019.

The ACTU itself says that this year’s claim is step 1 towards the creation of a “Living Wage” as the new minimum pay rate. The aim is to establish a minimum rate about 2/3 of the national minimum wage. That would mean about an $80 per week increase this year. Clearly, this year’s strategy must be run as a platform for a more determined and bigger effort next year, no matter who is in government.

From the past 20 years of experience we know that the “obedient” strategy that abides by “the broken rules” is a failure. And, the AWR process in the FWA09 is one of the most broken parts of it. (See sections 134 and 285.) On equal pay the FWC has interpreted the “broken rules” such that important direct arguments on why and how to narrow the notorious gender gap on wages are rejected. (See the ACTU Submission here.)

This strategy is built around polite and strongly researched submissions (still important), orderly advocacy, a few “real” low paid workers as supplicant witnesses (a bit like Dickens’ Oliver Twist asking for more), on line petitions, a dose of social media outrage, and sometimes small scale symbolic protests.

In effect this past strategy concedes to poverty and inequality. On its own IT DOES NOT WORK. It is for dreamers only, those who love court processes, economic “debate”, and custom and practice. Such dreamers could listen to this: “The Basic Wage Dream”.  (It’s an old song with a 21st century meaning. There is a reference to “Nugget” Coombes. He was the governor of the Reserve Bank at the time.)

We all know that enterprise bargaining is falling apart both for workers who have such Agreements and for those who don’t. It is no longer a serious strategic option for any  workers, let alone for the 21st century working class.

The sparkling leadership and campaigning savvy of ACTU Secretary, Sally McManus will not alone win this claim for low paid workers.

McManus needs a much stronger movement along with her than we are currently seeing.

The core spirit of that movement must be the “defiance” that she started talking about just on a year ago in that first memorable interview on “The 7.30 Report”. She has often emphasized it since as the union outlook that has achieved all of the great gains for workers in the past.

It’s time to shift “defiance” from a word with emotional cache to a real mobilization.

Can the Australian union activist “army” deliver real defiance that attracts the low paid and their allies and strike a hard blow against inequality?

Last year the Australian union movement played a highly visible and leading role in the successful campaign for marriage equality. We saw the vibrant energy and campaigning skills of the cohort of union organisers and active delegates and members who have become active in recent years.

It confirmed their very strong grasp of discrimination politics, the meaning and manifold impact of discrimination, and a very clear reminder that the working class includes a significant cohort of gay, lesbian and trans workers, who have vital relationships with “straight” workers as mothers, fathers, daughters, sons, friends and so on.

This campaign strengthened gay workers, educated “straight” workers, neutralized opposition to and prejudice against gay workers, and found collective public actions that all parts of the working class could connect to.

The middle level, newly emerging union leaders – officials, organizers, communications officers, job delegates, active members – showed in that fight against a particular form of discrimination what they are capable of.

Can they reproduce that real potential in a wages campaign? Can the mid level activist “army” get as outraged by the increasing rate of exploitation?

At the moment there is no real sign that they can.

As strong as this part of our movement are on “discrimination politics” they are somewhat weak on “exploitation”, and not showing any sign yet of the same levels of movement wide clarity and energy as last year’s anti discrimination campaign.

The next 6 weeks leading to May is a chance to start changing that.

Because that’s how we build the pressure from below that is needed to win a much better result in this year’s wage claim, much closer to the ACTU’s claim that has ever before been achieved. Luke Hilikari, Secretary of the Victorian Trades Hall Council, gets close to the point here.

Such a mobilization is what is needed for the millions of workers who are dependent on the AWR for their wage increase. These include those who are paid at the minimum rate, those who are underpaid by employers who thieve their wages from them (a business model in 21st century Australian capitalism) and those who are paid a little bit (bit not too much) above the minimum rate, but not enterprise agreement rates that tend to be much higher.

If you wish to use your own initiative to learn more about the formal process, and also see the submissions as they are posted, you can start here: https://www.fwc.gov.au/awards-agreements/minimum-wages-conditions/annual-wage-reviews/annual-wage-review-2017-18 .