Thursday, July 07, 2005
Bargaining away your holiday
The labour movement is on the verge of all-out war with John Howard’s Commonwealth government, as the prime minister’s intentions regarding labour law reform become clearer.

Currently, if you are covered under an existing ‘Enterprise Bargaining Agreement’ (EBA), your terms and conditions of employment are guaranteed to be as per agreement. EBAs are agreements between employers and employees (most often represented by a trades union).

John Howard proposals seek to require an all contracts to be negotiated on individually, thus finally crushing the union movement. There is little doubt that any individual contract signed will not be able to secure the same bundle of employee rights and responsibilities as that negotiated collectively.

It is also expected that John Howard will move to have unfair dismissal laws relaxed to exempt small to medium sized enterprises (<100 staff). To realise his ambition, Howard must centralise labour relations law, wresting it from the responsibility of the States (currently all Labor controlled) and granting it to the Commonwealth (conservative controlled).

So far as prime minister, Howard has been prevented from doing so as his conservative Coalition has never had control of the Senate. This changed in July, following early elections in February,

Since then, Labor has imploded, sacking its ‘shoot-from-the-hip’, ‘fighting-talk’ leader, Mark Latham and installing old ‘stand-for-nothing conservative’ war horse, Kim Beazley. ALP support plummeted. It seemed the Coalition was indomitable.

But recently John Howard has taken a pasting in polls, seeing his approval rating drop by 10% in the last few weeks. This is on the back of significant trades union rallies all across Australia (including 300,000 people in Perth) and an extensive and very targeted TV advertising campaign drawing attention to the changes.

Although the Coalition now holds a Senate majority, Parliament will not sit again to make laws until September. The Howard government therefore has time and does not need to go on the offensive. It can merely drip feed a range of proposals to test the ‘market’ before releasing draft legislation in a couple of months.

The latest policy snippet, spoon-fed to the outside world, is a proposal to allow employees to bargain away their annual leave.

The way this message is delivered will be all-important. Howard will draw on his conservative principles, championing employee choice and the right of that employee to bargain away their holiday as they see fit. The result: aspirational workers will be rewarded by individual contracts and they will hold all the cards, as employers attempt to negotiate the best deal to secure the services of the harder and smarter working employee (which may include more or less annual leave).

The changes will also provide more employer certainty as big chunks of accrued leave can bought-off, saving costs on back-filling long term, earned absences. And finally, if Australia has a more competitive commercial sector, we will encourage more job creation and opportunities for the more motivated employee. This legislation is good for business and therefore good for Australia.

This rhetoric is so far removed from reality to be not even funny.

Paid leave for a non-contract employees is now considered an entitlement. This is a right that has been steadily gained over the years by the labour movement. Howard’s proposals is an attempt to roll back years of gains for working people.

It is simply the thin end of a wedge that will be fully exposed when the draft legislation is published. Unless a loud and clear message is sent Howard now, the mechanism to allow employers to bargain away their employees’ holiday will be enshrined in law.

The current regime ensures that the Chief Executive of Brisbane City Council is entitled to at least the same pro-rata level of leave as the lowliest non-contract employee. If the mechanism to bargain away your holiday is allowed – who will be the most likely to cash it in? The highest paid, with the larger disposable income, or the poorest paid, with barely enough to make ends meet?

Most people have interpreted this proposal as the first of many steps towards a (US) standard of two weeks paid leave per annum. With workers being forced onto individual contracts, how long will it be before we see the standard contract offering just 2 weeks annual leave?

Annual leave provides time for recharging and engaging with families and communities. It creates opportunities for employees to expand their horizons and experience the world. It also allows them to just vege out and watch the cricket.

As a result of hard bargained deals, Australian employees have benefited from some of the most flexible leave regimes outside Europe. Many offer long service or unpaid leave or double your leave for half pay.

But already Australian working hours are rising again and the culture of working to play is been eroded and transformed into spiralling process of working ever harder.

Indeed, many economists trace most gains in Australia’s productivity (productive capital divided by gross product) being a result of lengthening working hours, rather than more efficient productive capital utilisation.

For the already poorly paid, this legislation will signal the end of significant paid leave, as the conditions of employment will be bid down. Alternatively, for the reasonably paid this will be further ‘encouragement’ for them to work ever longer and harder and become further estranged from their domestic or social life.

This estrangement will be experienced as waste but measured in the economy as growth; GDP growth. An increase in children under the care of the state, more roads from a greater amount of goods being meaninglessly shipped around and perhaps a growth in the prison population (which contributes more to annual GDP than putting a student through university).

The Unions are steeling themselves for a battle. Unfortunately, it is a battle we will probably loose. There is little hope that Coalition Senators will vote to protect the interests of the States rather than support the government’s centralisation program.

Howard is the smoothest of political operators and will use this parliamentary recess time to allow the dust settle on the Union campaign before ramping up his own campaign as the next parliamentary session nears. The Unions may unfortunately have peaked too early, as they were forced to respond to the drip-fed information very early in the process.

Now, the pressure will need to be maintained for longer than what is probably sustainable or affordable, but Howard must be stopped.

---