In reaching its decision, the High Court took a legalistic approach to its interpretation of the Workplace Relations Act 1996 (Cth) ('the WR Act') without giving significant consideration to industrial relations practices under the bargaining regime of Australian enterprises. In the federal jurisdiction, the provisions governing collective agreements made at the enterprise level are contained in Part VIB of the WR Act. 9 Part VIB of the WR Act provides for the conclusion of collective agreements without union involvement under s 170LK.
Section 170LI(1) of the WR Act provides that, for an application to the AIRC in terms of Division 2 for certification of an enterprise bargaining agreement, there must be an agreement on matters relating to the relationship between an employer who is a constitutional corporation and all persons employed by the employer's single business. Electrolux claimed that the bargaining fee clause of the agreement did not relate to a matter relating to the relationship between Electrolux and its employees under s 170LI(1) and therefore the agreement could not be certified. Whether a demand by a trade union that an employer should agree to a bargaining agent's fee is a matter relating to the relationship between an employer and persons employed in the business of the employer, within the meaning of s 170LI(1).
Doubts were cast on this conclusion when Electrolux no. Federal Parliament passed the WR Act two years after the New Alcan decision and the drafters would have been aware of the interpretation of the language applied by the Supreme Court.49. Differences in the interpretation of the language and context of s 170LI(1) allowed Kirby J to take a broader view than the majority in matters relating to the employment relationship.
An agreement that obliges employees to contribute to the financing of that process can be considered to be directly related to the employment relationship.68 However, this argument did not prove convincing to the majority of the Supreme Court. Contrary to this interpretation of the WR Act, the view of the Supreme Court was that an agreement cannot be validated if it contains a clause which does not pertain to the relationship between the employer and the employees concerned. 79 The objects of the WR Act include: 3(b) ensuring that the primary responsibility for determining matters affecting the relationship between employers and employees rests with the employer and employees at the workplace or enterprise level.
Thus, despite some support for the concept of negotiated fee clauses, the Supreme Court's position regarding the legal status of negotiated fees in the federal jurisdiction is largely confirmed by the position in the state with legislation that most closely reflects the WR. Act. 106 In Re: Review of Principles for Approving Enterprise Agreements IR 144 (New South Wales Industrial Relations Commission, 2002) The NSW Industrial Relations Commission reviewed the provisions of the Industrial Relations Act 1996 (NSW). The EA argued that the clauses were inconsistent with the freedom of association provisions under Part XA of the WR Act.
However, a full committee of the AIRC ruled that the bargaining fee clause was not objectionable:111. It amended the certified agreements and freedom of association provisions of the WR Act to prohibit clauses in certified agreements purporting to require the payment of a fee for negotiation services. Negotiation services are defined as services provided by or on behalf of an industrial association in relation to negotiating, making, certifying, executing, extending, amending or terminating an agreement under Part VIB of the WR Act.
The practical effect of this does not extend too far beyond the decision of the High Court in Electrolux No 3.
B User-pays
Conversely, "fair share" fees set below regular union dues, designed to cover bargaining services alone, appear to provide a reasonable compromise between overcoming the free-rider problem and maintaining respect for the concept of voluntary unionism.117 Such practices occur in many overseas jurisdictions and both the ACTU and the Australian Labor Party were willing to consider this type of arrangement.118 However, it was ignored by the government, suggesting that the passing of the WRPCUF Act was not motivated by any broad concern to protect freedom of association but rather to undermine a potential resource base for unions. The ILO's General Survey expressly states that 'bargaining fee provisions, when negotiated between unions and employers, are consistent with the principles of freedom of association.' again indicates a political agenda behind the government's actions, which cannot be justified on a broader public policy basis. However, according to the Freedom of Association Act, employees cannot be discriminated against on the basis of trade union membership.
It therefore seems hypocritical that the government prohibits the charging of bargaining fees for expenses incurred by a trade union to negotiate a collective agreement that must apply to all workers in an enterprise.122 Trade unions tend to treat the workers as a collective bargaining, and the government's own statistics show that enterprise agreements negotiated by unions consistently deliver higher average annual wage increases for workers compared to agreements negotiated without union involvement.123 Consequently, there are strong grounds for arguing that non-members , which all the benefits of a certified agreement, should add something to the cost of such a performance. The amendments are also contrary to the objectives of the WR Act and the comments of the then Minister for Workplace Relations, Mr Reith, when he introduced the WROLA Bill. 121 ENTERPRISE TO THE SENATE, WORKPLACE RELATIONS AND EDUCATION AND LEGISLATION COMMITTEE, PARLIAMENT OF THE COMMONWEALD, 'DEPARTMENT OF EMPLOYMENT AND.
The focus of the freedom of association provisions of the WR Act is on the individual. Given this emphasis on individual freedom of choice, the government does not consider it appropriate that the effect of freedom of association provisions be nullified by a majority vote that results in the will of the majority being imposed on individuals who are not. and do not want to be associated with a trade union.125 However, this overlooks the nature of the government's corporate bargaining regime, which gives the power to the majority to dictate terms to the minority, provided those terms are not discriminatory under the WR . Action. The government argues that the amendments clarify only one aspect of the bargaining process between companies.126 However, the WRAPCUF Act appears to be another attempt by the government to dictate the terms of bargaining by imposing restrictions on what employers, unions and/or put employees on the negotiating table, in a so-called deregulated workplace.127.
Regulations that cap the fee level, allow non-member objections, and mandate a minimum level of support for negotiated fee clauses appear to be fair trade-offs for their imposition, along with any other conditions the parties see fit. able to agree among themselves. Unions play an important role in representing the interests of the workforce in industrial relations, therefore, under the enterprise bargaining system, where unions require a high level of resources to serve a large number of jobs, it seems reasonable that those who benefit of union representation should be required to pay a fee for their services. Moreover, largely ignoring the industrial realities of enterprise bargaining and preferring to apply a legalistic interpretation of the WR Act, the Supreme Court in Electrolux No. 3 ensured that greater complexity in negotiating certified agreements would follow.
The contrary view, as expressed by Kirby J, provides a more liberal interpretation of the legislation which accommodates the practicalities of industrial relations. Unfortunately, the High Court decision in Electrolux No. 3, combined with the government's amendments to the WR Act, has ensured that unions are prohibited from charging bargaining fees. 131 SUBMISSION TO THE SENATE COMMITTEE, COMMONWEALTH PARLIAMENT, AUSTRALIAN INDUSTRY GROUP AND ENGINEERING EMPLOYERS' ASSOCIATION, SUBMISSION NO. MENT (PROHIBITION OF COMPULSORY UNION FEES) ACT.
