Media Release: Royal Commission Submission Calls for Minimal Regulation

3 November 2014
Royal Commission Submission Calls for Minimal Regulation

The HR Nicholls Society submission to the Royal Commission on Trade Union Governance & Corruption calls for existing regulatory arrangements under the Fair Work legislation and the Fair Work Commission (FWC) to be replaced with minimal regulation of employer/employee relations.

The submission, acknowledged by Commissioner Heydon, particularly addresses the reference on ‘the adequacy and effectiveness of existing systems of regulation and law enforcement’ (a)(j)

Analyses in the submission by two prominent lawyers show advantages conferred on trade unions which are unnecessary and unjustified. These include entry to work premises, ability to disrupt work performance, engagement in protected industrial action and forcing parties into regulated bargaining.With only about 15 per cent of the work force as union members, why is it so difficult to conclude individual agreements? Little wonder that ACTU Secretary Dave Oliver can proclaim that unions “represent about 60 per cent of the workforce” under present regulatory arrangements.

In a modern society there is no intrinsic imbalance in bargaining power between employers and employees and the conclusion of individual agreements should not be inhibited.

Unions exploit advantages by threatening to disrupt the activity of businesses unless concessions are made. Alternatively, claims with the FWC may secure working arrangements favourable to unions.

The resultant addition to business costs or prevention of improvements in efficiency have adverse economic effects. The environment of bargaining of pros and cons also opens the way to one or other form of corruption.

The Royal Commission has already identified “criminal conduct which includes widespread instances of physical and verbal violence, cartel conduct, secondary boycotts, contempt of court and other institutional orders, and the encouragement of others to commit these contempts”.

The adverse implications from both a legal and economic perspective would either not happen or would happen to a much lesser extent under minimal regulatory arrangements.

The submission urges the Commission to give more attention to the adverse economic implications of the existing arrangements. Employment levels and the unemployment of the lesser skilled are affected.

Des Moore, Publicity Officer
HR Nicholls Society


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