For The Labourer is Worthy of His Hire


NR Evans

None of the themes chosen for an H R Nicholls conference have generated more interest or criticism than the text taken from the 10th chapter of St Luke's Gospel, "For the labourer is worthy of his hire".

This conference was held in Melbourne in early April 1992, not long after the then newly elected Tasmanian Government, headed by Premier Ray Groom, had been sworn into office. The Tasmanian economy has long been recognised as a declining economy, characterised by a stagnant population, poor employment opportunities, low per capita incomes, high and growing public debt, and a dependency on government mandated transfers, particularly from Canberra.

During the 1980s Tasmania became a pawn in federal politics. In 1983 the federal election was fought, in part, over the use of the external affairs power, by the Federal Government, to block the building of a dam on the Franklin River. The newly elected Hawke Government did block the Dam and the Act authorising the decision was validated by the High Court in the Tasmanian Dams Case. Subsequently, in March 1989, a major paper and pulp investment at Wesley Vale was likewise vetoed by the Hawke Government, on environmental grounds.

In a State election held on May 13, 1989, the Gray government was defeated by the ALP which formed a minority Government, headed by Premier Michael Field. This Government held office with the support of five 'Green' independents. It fell early in 1992 because of its inability to resolve the deep conflicts of interest between Labor's traditional constituency, which is interested in jobs and economic opportunity, and the Greens' constituency, which takes jobs and opportunity for granted.

Soon after, a major industrial dispute, which dominated news headlines for many weeks all over Australia, broke out at APPM's paper mill at Burnie, Tasmania. This dispute was seized by governments and media alike, all around Australia, as a symbol of the labour market problems which characterise contemporary Australian life. This dispute was in its early stages when this XIIth H R Nicholls Conference took place and Chris Oldfield, Public Relations Manager for North Broken Hill Peko, gave the participants a first hand insight into the problems faced by a management which understands the imperative for international competitiveness, but is confronted by trade unions which see no need for competitiveness at all.

Labour market reform has been, and still remains, an urgent and pressing need for Tasmania if the State is to become again, as it was in the nineteenth century, a thriving economy.

The Society was delighted that Eric Abetz, and Forbes Ireland, two eminent Tasmanians active in the cause of labour market reform, were able to present papers at this conference. Subsequently opponents of reform used these papers as a device to whip up a furore in Tasmania and it was not until the end of 1992 that a reform Bill was passed by the Tasmanian Parliament. This Act will doubtless be seen in the future as a first step to effective reform.

New Zealand was very important in Australian political debate during 1992. The Victorian Government, headed by Labor Premier Joan Kirner, campaigned very strongly during the State election campaign of September 1992 against Coalition labour market reform policies. The ALP ran TV commercials featuring "Russell" and "Meg", embittered NZ critics of the NZ Employment Contracts Act, who told us that New Zealand was in decline and that industrial relations there were in a terrible state. (Despite these ads the Victorian Coalition won a sweeping election victory.)

This Act was proclaimed in May, 1991 and has provided New Zealand with a labour market which is far freer than in Australia. The success or failure of this Act will have far reaching consequences for Australia. If this Act, because of its obvious and overwhelming benefits, becomes part of the New Zealand social fabric, a non-controversial and permanent part of New Zealand life, then it will be impossible for Australia to resist, indefinitely, matching the New Zealand reforms.

The Society was privileged at this conference to have as the Keynote speaker, Mr Douglas Myers, Executive Chairman of Lion Nathan Ltd, now (amongst other activities) a major Australasian brewing company. He is also Chairman of the New Zealand Business Roundtable. Mr Myers gave a review of the New Zealand labour market after nearly twelve months of experience of the Employment Contracts Act. His paper, which was widely distributed after the conference, provided first hand and up to date experience of the New Zealand story. It will reassure advocates of reform that common sense does produce important benefits when applied in effective doses.

Many trade union leaders are deeply hostile to freedom, particularly freedom by workers to organise their own working lives. In the commercial building industry, an industry dominated by unions such as the BWIU and the BLF, the success of the Troubleshooters Available Agency, which successfully provided an intermediation service between self-employed building trades sub-contractors, and the managers of big building projects, was a challenge to union control of the industry. The Troubleshooters case went to the High Court and that court upheld the validity of the contractual arrangements which were the foundation of the legal relationships between Troubleshooters, the sub-contractors, and the construction managers.

The barrister who nursed the Troubleshooters case through two Federal Court cases, and the appeal to the High Court, was an H R Nicholls Society joint founder, and currently Federal Shadow Attorney, Peter Costello. This conference provided an opportunity to have the Troubleshooters story told by a key protagonist. The importance of this case is that it demonstrates unequivocally that trade union claims concerning their essential role in maintaining wages and conditions are false. The returns which the independent sub-contractors obtained for their labour were better than the returns which union controlled employees obtained.

This situation was intolerable for the construction unions and the Federal Government, with the support of the Democrats, amended the Commonwealth Industrial Relations Act in June 1992 with the aim of overturning the High Court decision in Troubleshooters. Because the Housing Industry Association, the body which represents domestic housing sub-contractors, put up a valiant public campaign against the Bill, the Act as passed was much less damaging to independent contractors than was first planned by the Minister, Senator Peter Cook, and his former colleagues in the BWIU. Nevertheless this Act was passed to entrench and extend trade union power, and its repeal is an important and urgent matter.

Other topics discussed at the conference were local government, the meat industry, and the key issue of statutorily enforced minimum rates in the labour market.

In this volume the H R Nicholls Society continues with its task of recording and disseminating important developments in the Australian debate on industrial relations. The reader will find here a collection of papers of historical, philosophical and theoretical importance.

N R Evans President
January 1993