Industrial Relation in Australia Essay Example | Topics and Well Written Essays - 2000 words

Industrial Relation in Australia - Essay ExampleTo understand the transformation, it is useful to briefly dismiss twain common explanations for union decline. The first is that unions declined because workers became much skeptical about them. In fact, attitudes tend to be a mirror image of union strength. When union rank swelled during the 1970s, Australians became more likely to tell pollsters that they thought unions had too much power, and less likely to agree that unions had been a good thing for Australia. Correspondingly, as unions waned during the 1990s, the fraction of people who thought that unions had too much power or that Australian would be better off without unions steadily decreased. Another argument that is sometimes made is that deunionisation was a result of the decline in real wages that took place under the Accord. Yet as David Peetz points out in his book Unions in a Contrary World, this explanation implies that unionization should have declined more during the 1980s (when real wages fell) than the 1990s (when real wages rose). In fact, the reverse is sure - the biggest fall in unionization occurred during the 1990s.The most significant factor in Australian deunionisation has been changes to the legal regime governing unions. Peetz points out that between 1990 and 1995, conservative governments in five out of six states introduced legislation aimed at prohibiting irresponsible unionization (banning closed shops), encouraging individual bargaining, and making the transition to non-award coverage easier. In the late-1980s, more than half of all union members were required to be a union member as a condition of their employment. In the 1990s, freed from the requirement to belong, large numbers racket chose to opt out. Unsurprisingly, the unions hit hardest were the ones that were most reliant on compulsory unionism laws. The new regime was locked in place in 1996, when the newly-elected Howard Government virtually abolished compulsory unio nism nationwide, and made it more difficult for unions to recruit and strike.The next most important driver of deunionisation has been raising competition. Spurred by microeconomic reforms, tariff cuts, and a improve Australian Competition and Consumer Commission, the markets for buying most products and services are now substantially more competitive than they were in the 1970s. When firms enjoy a monopoly or oligopoly position, it is easier for them to cede higher wages to their employees. Prices are higher in non-competitive markets, and in the jargon of economics, this generates rents. These rents are then shared between employers (who enjoy higher profits than they would in a competitive market) and workers (who earn more than in a competitive market). When monopolies are broken down, and markets become more competitive, management has to start cutting costs. This places military press on management to adopt stronger anti-union tactics in order to reduce the wage bill. The t hird explanation for falling union density is the growth in