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Australian philosopher, literary critic, legal scholar, and professional writer. Based in Newcastle, NSW. My latest books are THE TYRANNY OF OPINION: CONFORMITY AND THE FUTURE OF LIBERALISM (2019); AT THE DAWN OF A GREAT TRANSITION: THE QUESTION OF RADICAL ENHANCEMENT (2021); and HOW WE BECAME POST-LIBERAL: THE RISE AND FALL OF TOLERATION (2024).

Monday, October 31, 2011

Fair Work Australia decision re Qantas case ... and some comments on keeping a sense of perspective

Those people who are interested in the Qantas case, which looked like stranding me and many other people, could do a lot worse than reading the actual decision by Fair Work Australia (what was once known as the Australian Industrial Relations Commission). The attachment to the decision, which sets out a timeline of events, is especially useful.

As some of you know advocacy before this tribunal (or, rather, its predecessors) made up my bread and butter work for many years, and I was at one point a fairly prominent specialist in this area of law. If some things had gone differently, maybe I'd now be a member of the tribunal, with all the attendant headaches. Although I'm out of touch with the details of current Australian labour law - a very volatile and politicised area of the law - I retain a certain interest in it that goes beyond my personal interest in getting home from the US over the next couple of days.

I've seen a great deal of uninformed speculation about this case, with many people expressing pet theories that seem to have little basis in reality. As far as I can see, both the unions and the employer have simply followed the logic of the legal system as it now works in Australia, and neither is terribly culpable - much as I am not especially happy with the scare I received this week, and much as I can imagine that passengers who found themselves actually stranded in airports at the last minute must have been furious.

From here, it looks as if Qantas made a calculated gamble that an extreme move - grounding the fleet and locking out employees who were taking industrial action - would force the hands of the government and the tribunal, and lead to a rapid termination of all industrial action. That gamble has evidently paid off.

While it is a bad look for the CEO of Qantas to ground the fleet, even for a couple of days, and to take a monstrous personal pay rise during the period of an industrial dispute, his move a couple of days ago will very likely turn out to have been a smart one, possibly the best available to him in the circumstances. In the short term, at least, shareholders will probably be happy with him.

It looks as if this case could be headed for compulsory arbitration proceedings(that's if it can't be resolved by negotiations in the next few weeks).

More generally, I repeat that this is the logic of the system. The system encourages tests of industrial muscle, and there is little that an employer can do in such a tussle apart the nuclear option of locking out staff. As long as we want an enterprise-level bargaining system based around tests of relative industrial muscle between unions and particular corporations, this kind of thing will happen now and then. Such a system supposedly has micro-economic benefits in matching wages to profitability across the economy.

Of course, similar large-scale disputes and disruptions also happened under the old system of industry awards and compulsory arbitration that was traditional in decades in Australia. The only difference was that strikes and lockouts were technically unlawful under that system. They happened anyway, and I seriously doubt that any less days of work were lost. On the contrary, such episodes of disruption are probably rarer these days than in previous decades.

Some people are calling for the nationalisation of Qantas, but this dispute really has nothing to do with that. Government-owned enterprises can experience similar disruption, as has happened many times in the past, including in disputes that I was personally involved in during the 1980s, when I was a young man carving out my reputation as an industrial advocate employed by the Commonwealth government.

All in all, these sorts of disputes are unpleasant, decisions made in them can be nasty and sometimes foolish (as with the mass resignation of aircraft pilots across the industry in the celebrated 1989 pilots' disputes), and can disrupt the plans of ordinary people. The system does, however, have a certain logic, and in the case the parties have played it out. I can't see that either the trade unions or the Qantas management have actually done anything especially reprehensible here, or how they could have acted all that differently with the system currently in place.

In short, a bit of perspective is required here before we start seeing the dispute in class-warfare terms and condemning either greedy unions or evil corporate management. You get the system that is voted for, and you get the results that the system encourages. Moreover, no system can guarantee a society without industrial disruption; the point is to try to contain and manage it within broadly acceptable boundaries. That's pretty much what's happened here.

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