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Through its proposed legislation the Government seeks to prohibit or severely curtail the practice it describes as pattern bargaining. In doing so, the Government provides little in the way of justification.

When reduced to its essence, the Government’s objection to “pattern bargaining” is founded on its desire to irrevocably shift bargaining power in industrial relations to employers. Pattern bargaining is seen as an obstacle to this aim because it is an effective response by organised workers to a decentralised wages system. The great “sin” of pattern bargaining is that in the Australian context it is has served to increase real wages and preserve hard won conditions for tens of thousands of workers.

There is nothing radical or sinister about pattern bargaining. Indeed, a form of pattern bargaining has existed as long as workers have sought to organise into trade unions, and probably even before. Internationally, pattern bargaining (in a variety of guises) is the dominant wage fixing mode in most OECD nations. The underlying attraction for workers and employers of pattern bargaining is its emphasis on comparative wage justice and a level playing field. These are notions that the government cannot by dint of legislation eliminate.

As with much in the current bill, clarity is not a strong point. The bill seeks to penalise unions for embarking on pattern bargaining without really defining what is meant by the term. However, one is left in no doubt at the target of the legislation if Workplace Relations Minister’s speeches on the topic are any guide – organised workers in construction, transport and manufacturing. (P. Reith 20/5/99, speech to Master Builder Australia Symposium. P. Reith 18/3/99, ALMCA Victoria Breakfast).

The implicit definition of pattern bargaining that underlies the Minister’s speeches might be paraphrased as follows: “ pattern bargaining is the process whereby unions decide on a log of claims and then pursue these claims by way of collective, single company, enterprise agreements. The aim of the process is to achieve uniform (or very similar) terms with more than one employer in an industry, sector, or company group”.

The words underlined are used deliberately. As will be demonstrated below, the Government’s real objection to pattern bargaining is centered on its collective, union initiated character. Indeed, the Government explicitly promotes a double standard in respect to enterprise bargaining. That is, the Government is quite happy to promote pattern bargaining where the effect is to impose pre-determined employer parameters, but not where it reflects a desire by workers for new benefits or real wage increases.

The desire of unions to pursue common or uniform claims in an industry or sector derives from a number of fundamental motives. Foremost amongst these is the collectivist culture of unionism itself. Unionism constitutes a denial by workers of a radical individualist ethos. The act of joining a trade union is an affirmation of the basic notion that an individual worker is in an unequal bargaining position with his or her employer. However much the Government would have it otherwise, the very large number of Australian workers that continue to be represented by unions is a testament to this fact.

Flowing from this basic realisation are feelings of group identity and solidarity which in turn, gives rise to the concept of comparative wage justice. (‘Must it End in Tiers’ Employment Studies Centre October 1996, University of Newcastle P.14) Comparative wage justice is simply, the idea that similarly skilled workers doing similar work, should receive similar wages. It is a basic and enduring idea in the Australian workplace. It is reflected in the structure of the award system. It is reflected in both formal, union initiated bargaining, as well as in a multitude of informal arrangements in the work place.

Conversely, perceptions of an imbalance in pay and benefits for similarly skilled workers remains a major source of grievance in both unionised and non-unionised workplaces. The basic attraction of comparative wage justice – however described – is the reason that unions around the world tend to pursue similar outcomes for similar groups or classes of employee. Pattern bargaining in the Australian context, expressed generally as a set of claims by unions for a group of workers in an industry or sector, needs to be understood within this paradigm.

An equally strong impetus for a degree of similarity in the remuneration of groups of employees derives from employers. That is, employers across industries have a vested interest in paying at least the “going rate” for an employee. The “going rate” will differ radically between industry and classes of employee depending on a range of factors. At one extreme the legal minimum rate expressed by an award or legislation will equal the “going rate”; in other circumstances a large premium above minimum rates will be dictated by market conditions.

The issue of the “going rate” is of particular concern to employers who operate in sectors that are labour intensive but with a low capital base (such as the construction industry). In such a context, the ability to obtain a competitive advantage through investment in technology and plant is very limited. Essentially, the only area in which costs can be significantly decreased is in the area of wages and overall remuneration. Therefore, the issue of being able to effectively compete comes down to a management choice of whether wage levels ought to become the principal determinant in who wins a contract.

It is entirely understandable that many employers (particularly when dealing with a highly skilled and/or unionised workforce) will opt to avoid the option of decreasing workers wages. There is accordingly, a receptive audience amongst many employers for a “level playing field” in relation to wages and conditions of employees. Furthermore, in industries where something more than the legislative minimum will be dictated by market conditions, pattern bargaining is the only reasonable option for employers.

A further employer impetus towards pattern bargaining concerns the logistics and resources involved in committing to “genuine” enterprise bargaining. That is, the idea that each enterprise should “tailor” its industrial relations arrangements to suit its own circumstances, simply does not make sense in a large number of Australian workplaces. The construction industry for example, is comprised of 95,000 enterprises that are overwhelmingly small, under-capitalised businesses employing less than 10 employees. (ABS Cat. 8772.0 ‘Private Sector Construction Industry’ Jan 1999). The idea that each should have its own specially formulated arrangements is both unattractive (in a financial sense) as well as impractical in that specialist sub-contractors (the employers of most workers) are not generally the determiners of industrial arrangements on multi-employer building sites. It is normally the head contractor who exercises effective control of work arrangements on site - a position that reflects the risk that the head contractor carries.

In his observations arising from an international study tour, Bob Herbert from the MTIA (now Australian Industry Group) observed:

Similarly, Herbert also observed that in Germany collective agreements were negotiated centrally between unions and employer associations. Once concluded and registered with the Labour Court, the agreements became legally binding (at 45). In effect, they become like our awards – with the difference that are simply legally sanctioned pattern agreements that do not have any input from an independent third party.

The prevalence of pattern bargaining throughout the developed world speaks of the wide appeal of the notion of comparative wage justice. Moreover, there appears to be at least three common issues in the regulation of pattern bargaining.

First, there is a wide acceptance of the right of unions to develop and pursue claims relating to working conditions and wages on behalf of members (and in some cases non-members as well). There is generally no qualification as to what a union may or may not claim, provided generally that the claims relate to industrial matters.

Second, there are certain rules relating to the conduct of unions and employers in the course of making agreements that confer obligations and protection, particularly in relation to the right to strike.

Third, Governments do not generally dictate to the industrial parties at which level a collective agreement shall be struck. Specifically, the industrial parties are free to conclude agreements that suit their circumstances, whether that be at the individual enterprise, occupational or industry wide level.

It is clear that the Government’s aversion to pattern bargaining runs against the international norm. Only in the completely deregulated New Zealand context is there a similar legislative prohibition on pattern bargaining. On this point, it is notable that an ILO report on the Employment Contracts Act in New Zealand concluded that the provisions in the ECA that remove the right to strike for unions pursuing “multi-employer contracts” were contrary to ILO Conventions (Complaint by the NZ Council of Trade Unions, Report No. 292 Case No. 1698).

As much as the Government would have the Australian public believe that its opposition to pattern bargaining is simply concerned with maintaining the “integrity” of the enterprise bargaining system, the reality is far different. Through its own actions via the Office of the Employment Advocate (OEA), the Government has clearly shown that its heart-felt opposition to pattern bargaining disappears when there is an advantage in pattern bargaining tactics from anti-union perspective.

The OEA stated in evidence before the Senate Estimates Committee that there were ‘framework’ Australian Workplace Agreements (AWA’s) in use that “...tend to look fairly similar.” (Senate Committee Hansard, 10/2/99) Mr Hamberger further stated; “We would see potentially the development of framework agreements that have a fairly high degree of consistency as potentially, if done well, a quite positive development”. Indeed, the OEA devotes considerable resources to developing AWA’s that can be applied uniformly to employers in an industry

At a conference on workplace relations hosted by the Master Builders Association, Mr Hamberger insisted that identical or near identical AWA’s developed by the OEA to apply to a range of employers in an industry did not constitute pattern bargaining. In a particularly accomplished example of the art of semantics, Mr Hamberger insisted that the said AWA’s were merely “templates” and therefore not against the spirit of the WR Act! Clearly, pattern bargaining is OK where it does not have a union or collectivist basis.