What does O’Farrell’s attack on the IRC mean?

Union leaders have denounced the NSW Liberals new public sector law as “worse than WorkChoices”.
Their new law requires the Industrial Relations Commission (IRC) to enforce any government decisions about public sector wages and conditions—such as its declared 2.5 per cent pay cap on pay rises.

Unlike WorkChoices or the old award system there is potentially no set of minimum conditions for workers’ conditions. This means that some of the minimum conditions in WorkChoices, like maximum ordinary work hours and casual loadings, could be changed by government regulation except those, like superannuation, covered by separate legislation. For now, its aim is simply to enforce the 2.5 per cent pay cap.

Until now the IRC has supposedly been an “independent umpire”, able to make its own rulings on disputes between the state government and its employees in the NSW public sector. Private sector and federal public sector workers are covered by the federal Fair Work Australia system.

Some union leaders have attacked the new law by saying it takes away the right to collective bargaining—because the government can refuse to bargain and the IRC must simply enforce government regulations.

What the new law really does is get rid of the option of IRC arbitration. Before O’Farrell’s new law, if the government and a union could not reach a negotiated agreement, the IRC could make a legally binding decision itself.

In the past unions have often opted to make claims directly on the government, backing their negotiations with industrial action. Union officials at some weaker public sector unions, however, see the option of arbitration as a lifeline, since they have no faith in winning wage gains through the unions’ own industrial strength.

Arbitration’s history
The IRC and the existence of arbitration was designed to tie unions into an officially sanctioned system for registered unions and settling disputes. It offered the carrot that IRC decisions would become legally enforceable against the boss without having to take strike action.

Arbitration became entrenched as a way of dampening down class struggle and incorporating the unions following the great strikes of the 1890s. Both the cost of the strikes for employers, and the weakening of workers’ position by the crushing defeats for the unions, encouraged both to look to a state system to manage disputes. But Arbitration Courts like the IRC were established with the specific aim of preventing “industrial disputes”, and for most of their existence strikes have been illegal.

Any group of workers that stepped outside the IRC system, by striking to demand higher wages than the IRC decided on, faced serious fines or even deregistration as a union. In 1969 the Victorian equivalent of the IRC jailed Tramways Union leader Clarrie O’Shea, after his union had refused to pay fines imposed by the IRC.

The IRC was designed to contain workers’ struggle. In 1940 industrial action was decriminalised in NSW, but only if 14 days notice was given—enough time for the employer to make strike action ineffective through organising scab labour and making other preparations.

Industrial courts are not “independent” but are part of the capitalist state—and therefore favours the bosses. During the Great Depression in 1931 the federal Arbitration Court imposed a 10 per cent wage cut on all workers. There is an old saying, what you can’t win on the ground, you won’t win in the courts. The NSW IRC too has often handed down appalling anti-worker decisions.

Its decision in the NSW wage case for TAFE teachers at the end of 2009 was a prime example. It imposed an extra five hours attendance time a week for TAFE teachers, as well as making working hours “flexible” across a whole year. The union was forced to strike in defiance of IRC orders and the threat of fines to win a slight improvement in their agreement.

Anti-strike laws that shackle the unions are still in force. Both remaining state IRCs and the Fair Work Australia can fine unions for illegal strike action—either strike action outside a bargaining period or in defiance of an order by the courts.

Socialists have always argued for industrial militancy, in defiance of the law when necessary, as the only effective way to win the fight for pay and conditions. We will have to fight O’Farrell’s law, not to defend the supposed “independence” of the IRC, but to win real wage rises and defend conditions from government attack.

Industrial action can beat O’Farrell. We need strike action across the public sector for the Unions NSW day of action against the law on September 8. NSW teachers will be bargaining directly with O’Farrell at the end of the year. A concerted campaign, backed by other unions, can break the Liberals’ 2.5 per cent pay cap and make O’Farrell’s law a dead letter.

By James Supple


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