Management can ignore unions and deal directly with staff

The Australian, August 12, 2017 – Grace Collier

This week we saw some argy-bargy within the industrial relations club. Here’s a tip from a seasoned professional: think of the IR club stoushes as a boxing match and imagine what nicknames could be assigned. This might make some tired old routines slightly entertaining.

At the start of the week, boxing in the blue corner, sponsored by big business, Martin “The Rat” Ferguson limbered up. Ferguson dislikes his nickname, apparently. It was given to him by the red corner, which will never forgive him for leaving it to fight for blue.

Ferguson started the first round with some cautious and exploratory jabs. The government should take “workplace relations reform out of the deep freezer”. The laws favour the unions too much in some places. Right-of-entry privileges are being abused.

Like a shot, charging out of the red corner with a bloodcurdling shriek, came Sally “The Mad Commie” McManus. She is sponsored by the unions and doesn’t like her nickname either. It is said she prefers “Fists of Fury”, but her habit of wearing a hessian peaked cloth cap and carrying on like a miner from Margaret Thatcher’s Britain means “The Mad Commie” seems to have stuck.

To start, greedy, tax-dodging mining bosses want to drive down wages and make workplaces more dangerous. McManus says these companies have a licence to print money by extracting our resources, yet “their greed knows no limits. If we were all working for $4 an hour with no job security while they paid no tax, it would still not be enough for them.”

The legacy that working people have been left by the mining boom is “a budget deficit, hollowed-out job prospects and companies so powerful they keep demanding more and more”, and “every Australian suffers as a result of the greed of tax-dodging big business”.

McManus has an unusual technique; her arms flail in furious windmill motions. Precision is not a strong point; the crazy-brave punches rarely land, but the whole spectacle is quite entertaining. Understandably, fans in the red corner go wild with enthusiasm.

If you feel “The Rat” and “The Mad Commie” are both being mocked, then your columnist stands guilty as charged. These faux arguments by pretend enemies, who are all in the same club, grow more tiresome by the day. Making fun of them seems the best way to respond.

The Fair Work Act is not perfect — no legislation is — but businesses with IR difficulties should change their advisers and management systems.

In times gone by, it was difficult to exit the bargaining system, but in the past couple of years all this has changed. Key legal decisions show that companies can let their enterprise bargaining agreements expire, then apply to the Fair Work Commission to have them terminated.

Agreement termination applications are the fastest growing trend in the IR sector. Anyone can go to the FWC website, fill out the form and lodge it. A few years ago, terminating an agreement was unheard of, but more than 500 terminations occurred last year.

After an agreement is terminated all workers are returned to the relevant award and can be paid on individual contracts, at above award rates, if the employer chooses.

There is no need for any employer to engage in enterprise bargaining any more, and anyone pretending otherwise is being disingenuous. Bad management habits are hard to break and law firms are making a killing, gouging companies for bargaining services they don’t need and cannot afford.

In rare and extreme circumstances, employers can be compelled by their workforce to bargain. If this happens, managers can send external “bargaining agents” to meet the union offsite and no one can be compelled to make any offer or sign any agreement. No employer can be forced into entering an agreement. Further, there is no imperative for any business to meet or deal with any unions as part of their business operations, regardless of how many employees are union members.

Unions have right-of-entry privileges to talk to workers, but these do not extend to talks with management. Managers can decide not to meet union officials, and instead spend the time talking to their staff and building strong, direct, employment relationships.

It is said some companies like agreements because they offer periods of protection from industrial action. This is more a perception than a reality. If workers are furious enough, they will withdraw their labour, whether covered by an agreement or not.

If businesses want to, they can break up with their unions and make up with their staff. This doesn’t mean forcing workers to abandon union membership. Workers have every right to be in a union and cannot be discriminated against or harmed for doing so. Breaking up with a union simply means the management team ignores the union official and focuses its efforts on building a relationship with the workforce.

The legal framework for breaking up with the union and making up with your staff is already in place. The government doesn’t need to do anything. Boxing bouts between IR club warriors, while entertaining, should be seen in context. In reality, companies are prevented from achieving IR reform by their legal advisers, management belief systems, habits and skill sets.