In early 2001 the Australian union movement hailed a victory that on the surface offers to help turn the tide of their continuing membership collapse. The union joy came from an Industrial Relations Commission decision allowing compulsory $500 "service fees" to be charged against non-union employees for union led enterprise bargaining processes.
Even though by late 2001 the service fee mechanism encountered legal set back the union relief at finding a system that enables them to extract money from non-unionists is understandable. Predictably the federal government attacked the fees on accusations of back door compulsory unionism. The union retort is that they are just applying market principles of user pays.
However what has not been mentioned is that this union application of market principles strikes at the integrity of Australia's industrial relations system. Perhaps unwittingly the union movement have badly shaken a pillar upon which the system rests.
According to the Australian Industry Group, the issue came about when an agreement was reached between the Electrical Trades Union and the National Electrical Contractors Association (an employer association) who with the ETU struck an umbrella agreement imposing service fees on non-unionists. The agreement was subsequently inserted into the enterprise agreements of 240 NECA business members.
The process by which this situation arose demonstrates that in Australia the power of the union movement most frequently rests in the hands of management. The trick for unions is to find employers and/or employer associations who will, for whatever motivation collude with the union to screw the worker. The collusion then becomes legally sanctioned under the industrial relations system.
The Webster Dictionary describes collusion as a process of creating an "agreement for a deceitful purpose, especially between persons appearing or pretending to be adversaries or competitors".
It is in recognition of this Australian historical propensity for union-employer collusion that the Bill introduced by the federal industrial relations minister to stop service fees, prohibits employer organisations as well as unions from imposing service fees on non-unionists. Even though the Bill has been blocked in the Senate subsequent decisions in the courts have complicated the issue and unions will need to strategically regroup. However this apparent service fee win should actually worry many in the union movement for the longer-term implications of the precedent being set.
Australia's industrial relations system is not based on a user pays principle. In fact the reverse is the case.
Self-funded retirees, GST paying consumers, the 1.6 million workers not within the IR system and every other non-award taxpayer, pay for the significant cost of the Industrial Relations Commission even though they are not recipients of IRC rulings. Employers who do not pay employer association membership fees suffer the "imposts" imposed by IRC decisions. Non-employee taxpayers subsidise union dues by making the dues tax deductible. In large part the system is based on non-user pays.
The social trade off for the paying of costs by non-users is that industrial relations system decisions are imposed on all employees and all employers alike on the pretext of community benefit. The introduction of union bargaining service fees as a condition of employment breaks the social settlement on which the IR system is built and initiates a chain of events in an entirely different direction.
The end consequence can quite possibly be a very different system. User pays is not a principle applied for the benefit of the privileged where the payer has no choice. Compulsory fees for a compulsory service is not user pays. User pays involves clear, free and informed choice by persons who demonstrate a wish to use the service on offer.
So if user pays is to apply in this new world initiated by the unions, taxpayers would not cover the cost of the IRC. Costs would be covered on a fee for service basis to unions, employer associations and anyone else who sought to make representation. Limited and privileged rights to representation would disappear and any employee or group could make representation to the IRC. Decisions would only apply to those persons who made representations. Employers who were not members of associations who made representation to the IRC would not have to comply with rulings. Employees and employers would be given the choice to use the services of the IRC or could settle on work arrangements without the services of the IRC.
The real treat to the system is that in their dash for cash Australian unions have exposed the frailty of their own position and become an instrument of the IRC's destruction.
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