The Workchoices Restoration or “Unfinished Business”: The Qantas lockout and power at work under the Fair Work Act
A shorter version is in Australian Options
by Don Sutherland – November, 2011
The context for the Qantas and Nurses’ dispute
Right now, about 40% of the Australian workforce is employed in “precarious”
or “flexible” employment, and most of them do not want to be there1.
The struggle for job security as direct, permanent employment is happening all
over Australia, and is central to both the Qantas and the current Victorian
Nurses disputes, although the detail is different.
In 2007 Labor rode into government on the back of the Your Rights At Work (YR@W) movement. In the midst of movement wide despair in 2005, YR@W
showed that the seemingly impregnable Howard government could be challenged and defeated because of its hated Workchoices laws. Having won government, Labor, among other things, consulted widely, including with
employer organisations, to replace Workchoices with the Fair Work Act (FWA). We have had 3 years now of the FWA.
For about 12 months various champions of Workchoices have been steadily
building a push to wind back Labor’s FWA and to restore Workchoices, with some variations and albeit under another name. The Qantas lock out and shut down was an important step in this corporate rights campaign.
The process is intended to culminate in 2 stages: first in the Labor
government’s own review of the Fair Work Act (henceforth “FWA”), due to start early next year and, secondly when there is a Federal election. Abbott has clearly stated that he wants to reverse Labor’s 5 year phase out of
statutory individual contracts (ie Australian Workplace Agreements) without
calling it Workchoices.2
The leading visible participants in this process include The Australian3 (of
course), including its “editor at large” Paul Kelly4, The Financial Review5,
Peter Reith6, Peter Costello, John Howard7, Jamie Briggs, Judith Sloan8,
2 “Bring Back Work Contracts”, the Sydney Morning Herald, 3/12/09,Tony Abbott interview and story
by Phillip Coorey and Peter Hartcher
3 For example, The Australian, 10/10/11: “BlueScope Steel’s troubles blamed on giving ‘alarming’
control to unions”, by Hedley Thomas; 3/10/11; and http://www.theaustralian.com.au/nationalaffairs/
4 Paul Kelly, Editor at Large, The Australian, http://www.theaustralian.com.au/news/opinion/blamegame-
5 For example, The Financial Review, 31/10/11: Editorial, and articles by Alan Mitchell, p. 4, Ian
Hanke p. 55, ‘Chanticleer’ back page; : “Battle for the workplace”, pp 16-20
6 For example, Lateline, ABC TV, 21/9/11
7 See http://www.abc.net.au/insiders/content/2011/s3271207.htm
various right wing think tanks like the Institute of Public Affairs9, particular
employer figures like Chris Corrigan, anti worker pro corporate legal firms,
especially Freehills, and a range of employer organisations10, including those
that are seen as more “moderate”, like the Australian Industry Group.
These disputes show that far from ushering a brand new world of workers rights and union power, the FWA carries a lot of Workchoices anti union and anti worker baggage.
Unfair dismissal rights are better but not extended to all workers yet. There
are stronger “general protections” for workers around “freedom of association”, but this is not extended to construction workers. The bargaining provisions remove new statutory individual contracts, but individual common
law contracts can survive along with a 5 year phase out of existing AWA’s.
It is easier for workers and unions to initiate bargaining, especially if well
organised and prepared in advance. But important features of Workchoices
bargaining are retained.
What has been confirmed in both the Qantas and
Victorian nurses disputes is the serious consequences of unprotected action,
just how regulated PIA is – it’s restricted to the bargaining process, difficult to
get it approved, and seen in sharp detail, penal powers for employers to use if
PIA becomes genuinely effective.
As one union leader put it back in 2008, there is much UNFINISHED BUSINESS. Much of what the YR@W movement thought they were fighting for did not appear in the new FWA. What gains that were achieved are now
Power at work
It should be remembered that there was no “right to strike” in Australian
industrial law until the Keating legislation in 1993 that established protected
industrial action. Nevertheless, before that workers and their unions found a
way to use industrial action to advance their demands for a better life. But there had to be a dispute over an incident and or a demand. Strikes and other forms of industrial action were the mechanism that triggered conciliation or arbitration in “the Commission” that would deliver a settlement, as an award or
binding decision. In effect, workers industrial actions established the standards that are the ‘fair go’ that makes up the so-called “lucky country”.
Nothing that improved workers lives was ever offered or given by their employers. In that respect, nothing has really changed.
Penal clauses were available to employers to narrow and prevent effective action and included in the 1980s, as they still do, sections of the Trade
Practices Act to stop workers from supporting each other, taking solidarity
actions with and for other workers. Even the arbitration side of dispute settling
8 For example, http://www.workplaceinfo.com.au , 4/10/11
9 For example, Union Militancy Just Doesn’t Fly, The Sydney Morning Herald 31st October, 2011, John Lloyd
10 For example, http://www.workplaceinfo.com.au , 22/9/11
was widely viewed, not universally, as loaded against workers in favour of employers.
Workers power turns around 2 axes. First, there is the organising capacity, strategy and tactics, and ideology of unions to build workers power and influence, no matter what.
The second axis is about the statutory rights of workers to challenge their employers, to organise, combine, join unions, to
bargain, to mobilise on an industry or class wide basis, on industrial, and also
‘political’ and social matters.
If the law is repressive, unfair, or undemocratic, this first subjective axis
becomes critical, building the power to change the law, including by defying
and disobeying it, even making the most repressive elements inoperative.
This was the case in the 1950’s and sixties, when the “bans clauses” (and sometimes the Crimes Act), were the penal powers of the day, used to hamstring and prevent effective, union action. Over some years a strategy
was developed which culminated in the famous Tramways dispute that triggered the mass defiance that defeated the penal powers in 1969 11.
The Qantas dispute and now the Victorian nurses’ dispute highlight the new
penal powers of the 21st century.
However, now, these penal powers are
rooted in the Corporations power of the constitution, not the old conciliation
and arbitration power. Howard’s Workchoices came from the Corporations
power and excluded the conciliation and arbitration power. It restricted the
conciliation and arbitration rights of workers, and those of the Commission
itself. Then, under Gillard as Minister, the FWA was also written under the
Corporations power. (Even though ALP policy says that all appropriate
constitutional powers should be used.)
Regarding statutory rights and responsibilities in the FWA, two broad issues arise.
First, there are what the FWA calls the “general protections” available to
workers. Broadly, these protections are about “freedom of association”, the
rights of workers to join together in various ways to discuss and pursue their
issues. In general these are much better for workers under the FWA than
Workchoices, and capture some of the positive (also complex) features of the
old legal rights. But, the Fair Work Act does retain from Workchoices a
definition of “freedom of association” that includes “freedom from association”.
Second, there is the content and processes for bargaining “enterprise
agreements” that provide pay, conditions and rights above the minimums in
statutes, awards, and national test cases.
In bargaining under FWA, there are some important improvements on
Workchoices, but also critical features of Workchoices are retained. It is a
11 Jack Hutson, Penal Colony to Penal Powers, Revised Edition, 1983, AMFSU.
Regarding the content of agreements, “What should workers (and employers), through their unions, be allowed to bargain into their
agreements? Only wages and conditions of employment? Or, should they
include workers rights about organising and representation?
And, critically, can they have job security rights? The status of “job security” claims has been a feature of workers struggles and legal contest for several decades now.
The statutory and case law tightly controls the text of a “job security” right, as
expressed in a collective agreement.
For example, an agreement cannot
directly prevent an employer from using outside contractors, instead of direct
employed workers, but it might be able to express the terms upon which they
can be hired. Whether an employer can substitute casual or contract workers
for directly employed workers does not “pertain to” the employment
But, at the moment, the right of a casual worker to convert to a
permanent after a period of employment is permissible.
The right to prevent outsourcing of jobs to overseas locations appears to be very limited.
The exclusion or inclusion of the workers’ demand for job security, even if
agreed to by the employer, is based on the “matters pertaining” principle. That
is, does the claim “pertain to” the employment relationship? If it is encroaching
on ‘management prerogative”, the employer-as-owner’s right to control, it will
probably be denied. Fundamentally, job security is held to be a matter only for
employers and their managers.
The Workchoices warriors, and most employers, say that the law should not
allow workers the right to bargain job security clauses into their agreements;
that , employers, corporate boards and executives can be trusted to look after
jobs. The critical decision about whether a worker can protect their livelihood
is not their business; this can indeed be left to the tender mercies of their employer.
One reason why Victorian Nurses are so passionately committed to their
patient ratios is that the “independent umpire”, Commissioner Blair, found in
2000 that it was the best mechanism to secure the best care for patients. Just
like their own common sense! Now, the Victorian government says
“…there ought to be flexibilities of rostering capacity for peaks and troughs of
demand”. How many nurses are needed at any time should be judged by senior nurses, he (Mr Djonoff) says.
But Commissioner Blair found in 2000 that senior nurses were often ignored
by high-level hospital managers, who were preoccupied with cost control.
Nursing federation secretary Lisa Fitzpatrick says that remains the case.
The second question is about bargaining processes and rights to take
industrial action, including of course the “right to strike”. The right to strike is
an international core labour standard set by the ILO.
12 Do nurse-patient ratios really matter? Michael Bachelard, The Age, November 20, 2011 –
Under the FWA, just like Workchoices, there is no general ‘right to industrial
action’, even to ensure that an employer does not breach an agreement.
The right to “protected” industrial action is restricted to bargaining, and there are
penal powers inside this “right” should the “PIA” become effective.
Unprotected industrial action is subject to a range of penal powers that can be
used against individual workers, unions and corporations. 13
Even PIA is not a simple right: the FWA’s imposes a set of at least 4 hurdles
that the workers and their unions must jump across before they can exercise
the right. They include, for example:
· The union must apply to the FWA for a ballot for a PIA to be authorised
by a majority of the affected members,;
· The employers can oppose this ballot and the content of the ballot
· A majority of members must vote and a simple majority of those voting
in favour determines whether the PIA is finally granted;
· Give 72 hours advanced notice to the employer about the type and
timing of action that might be taken.
At the same time, the employer is allowed to distribute, without any application to do so, a copy of the agreement they want to the entire
workforce for a ballot that may or may not be conducted by an independent party.
The Qantas dispute and the Fair Work Act
The Qantas board are on a hell bent path for a radical restructuring of the
company that includes significant relocation of its activities and associated
jobs overseas. They are exercising enormous power because of their control
of capital and associated investment decisions.
In the Qantas dispute we have seen the exercise of some counterpower by 3 separate unions, in 3 separate but coinciding bargaining processes, chasing 3 separate new collective agreements with different starting dates and claims,
endorsed very strongly by the members and backed up with different forms of
modest, low level industrial action, designed to minimise inconvenience to the
public. More Qantas bargaining is planned by the Qantas Engineering Alliance of unions in 2012.
First, what about the workers?
In regards to the Qantas dispute there has been precious little commentary
about the workers who have engaged in this struggle for job security.
In the 3 separate bargaining processes the workers bargained for months and
then decided to pursue PIA, they watched Fair Work Australia (FWAust)
consider their application to vote, check over and approve (maybe modify) the
13 See, for example, FWA, ss 539, 545-546
forms of action that might be protected, and eventually give them permission
to vote; then they voted, under Australian Electoral Commission control;
weighed up the very strong result in favour, bargained some more in good
faith, and then took very moderate PIA.
During their PIA ballot application to FWA, their job security claims would
have been scrutinised by FWAust because under the FWA it is, arguably, not
“good faith bargaining” if you are pursuing claims that are not “permitted
matters” or that are unlawful. The workers’ claims must have passed muster
when they applied, so at that point they had jumped all of the control hurdles
placed in front of them by the current law, most of them hung over from
Workchoices. These workers know what it is to be heavily “regulated”.
They engaged in their modest industrial action, kept on bargaining, and stayed cool in the face of abuse and denigration from their CEO14. They
participated in their actions with determination, colour, calm and dignity. Their
PIA was counter power against the power being exercised by the Qantas
board that threatened their jobs through the relocation of Qantas’ operations.
They were standing up for themselves and each other, rather than have someone stand up for them.
Then they found themselves locked out and grounded with barely any notice.
They absorbed the consequent s. 431 order against them, considering the
penalties and punishments they would have faced from both the courts and
from Qantas. They submitted to Full Bench’s decision.
Now, removed from their fray, they watch a Full Bench arbitration exercise
that threatens their job security claims, manipulated by Qantas using
provisions of the FWA established by Howard in his 1996 laws, and carried
over by Gillard through 2007-8 in her negotiations with the ACTU and
The Victorian nurses have opted to defy the orders against them and maintain
their industrial action. They have the overwhelming support of the Victorian
community, but are fully aware of the range of sanctions and penalties that
might be used against them.
What must workers be thinking? “Why must our job security be excluded from
bargaining?” “What do you mean, ‘job security does not pertain to the relationship with my employer?” “Whose law is it that says that ‘my job security is bosses’ business, but not mine’?” “What makes you think our job
security can be trusted with my boss?” “Can my boss do what Alan Joyce did?”
14 The Herald Sun, 19/4/11: http://www.heraldsun.com.au/businessold/qantas-chiefalan-
The lockout and the shutdown of the airline provided focus for the Workchoices warriors’ key messages, all of which are directed at the
restoration of Workchoices.
Three of the key questions about workers’ rights, relative to their employers,
still remain. First, should workers, through their unions, be able to bargain job
security claims into agreements? Second, how much statutory power do employers and unions actually have relative to each other? And, third, workers and how much power should they have?
For example, Judith Sloan15, academic, Westfield board member, said this
about the job security claims that are in the Qantas bargaining mix:
“The act (ie FWA) says nothing about the types of issues that can be
demanded by unions as part of enterprise bargaining. This contrasts
with the prohibited-content clause in the previous act.”
This is simply not true. There are limitations imposed on what can be claimed
starting in s. 172. Some claims may not be “permitted” and there are several
points at which these may be tested, either by the employer or the FWAust.
The main test is that the claim “genuinely pertain to the relationship” between
worker and employer, or between the union involved and the employer.
The Full Bench decision shows how strongly supported the claims and the
PIA were and how modest and accommodating the PIA actually was16.
The dominant media message from Qantas, and carried by most media in support of Alan Joyce, was that he had no choice but to escalate TO BOTH LOCK OUT AND SHUTDOWN. But, once again this message is not true.
The FWA in fact provides many options for Qantas, for that matter all
employers, to control the bargaining process, some of which have already
Qantas complained about a union official talking of ‘slowly cooking’ the
company in discussions with members about industrial action tactics. The
FWAust decision show that Qantas itself engaged in ‘slow cooking’, by
repeating NO to the most important claims over months, permitted by the Act,
and left the unions’ members with 2 options: capitulation on their most
important claims or protected industrial action tactics.
Employers are entitled to take “employer response action”, eg a lock out, that
is protected also, provided it is in response to the PIA taken by the union
members. There are no notice requirements and the employer is not restricted
to forms of counter action that ‘match’ approximately the action taken by the
workers. Suspension or termination of PIA does not necessarily flow from this
15 The Fair Work Act has three big flaws, Judith Sloan, The Australian, November 02, 2011 12:00AM
16 Fair Work Australia, decision regarding s.424 application by the Minister, 31st October, 2011, option.17
Ultimately, this is the option that was taken with the extra heat of the
shut down of the fleet to trigger access to s. 324 (see below).
Qantas could have sought from FWAust to suspend or terminate the unions’
PIA because that action was causing significant economic harm to the
company and other workers it employs. This is subject to a truth test.
Obviously Qantas was not sure whether they could meet that test.18
Qantas could also have lobbied hard for the government to make a direct
Ministerial Declaration under s. 431 to terminate the PIA. Suspension is not
available. There is no specific requirement on the Minister regarding how
much the employer must prove its case. It is feasible for the Minister to just do
what the employer asks for. Tony Abbott’s shrill demands that the government
take this option tell us a lot about his commitment to anti worker powers.
Qantas could have itself sought a suspension or termination order from
FWAust if PIA threatened or actually endangered the population or caused
significant damage to the Australian economy or an important part of it.19
Qantas could have threatened to lock out, then describe the consequent
shutdown and its safety and economic cost implications. But that would have
warned everyone and subjected the intent to scrutiny.
Therefore, to get the economic harm they needed they used the lock out PLUS the shutdown of the entire fleet, thus throwing the onus on the
government for direct Ministerial suspension (not taken), or the action it actually took to apply to FWAust. The intention was that if the government did not act, it would be blamed for 70,000 plus stranded passengers.
FWAust very quickly worked out that the Qantas lock out – shut down decision
had caused the economic harm, not the unions’ PIA’s:
“It is unlikely that the protected industrial action taken by the three unions,
even taken together, is threatening to cause significant damage to the tourism
and the air transport industries. The response industrial action of which
Qantas has given notice, if taken, threatens to cause significant damage to
the tourism and air transport industries and indirectly to industry generally
because of the effect on customers of air passenger and cargo services. The
Qantas evidence was that the cost to it alone is $20 million per day.”20
In other words, the workers’ actions were effective, Qantas was losing the
fight, and they went for the penal powers to save themselves, just like so
many employers have done in previous decades.
Qantas’ right, available when necessary to all employers, to apply to FWA for
suspension or termination, and separately for a Ministerial Declaration to
terminate, were created specifically for employers by the Howard government
17 Fair Work Act, section 412 and 413
18 Fair Work Act, section 423
19 Fair Work Act, section 424
20 Fair Work Australia: Decision, 31 October 2011. Matter no. B2011/3816
in 1996. They were designed then to rob workers and their unions of effective
industrial action, even before Workchoices came along.
Reith and Abbott were deeply involved in this.
Robbed of their universal right to take industrial action, simply because it is
effective, workers are removed as agents in defining their destiny through
collective action, and are forced to observe others (on huge salaries relatively
speaking and who never have to take action to get anything) arguing about and deciding on their futures.
In effect, workers are being told that you can do so much industrial action in
circumstances that are regulated, but if that action starts to be effective, we
will take it away. You can have so much power, but absolutely not so much
that you can hurt your employer like your employer hurts you.
Snap strikes are illegal. Snap lock outs are legal.
Thus, the notion that the FWA is weighed against employers is a myth that
must be promoted to legitimize ‘reforms’ that restore Workchoices in some form.
This did not stop The Australian’s “Editor-at-Large” Paul Kelly who wrote
straight after the lock out21 and shutdown:
“The Fair Work Act has changed the industrial relations culture and bargaining
in three critical respects. First, it shifts statutory power from employers to
unions. Non-union enterprise agreements are virtually impossible. Individual
contracts are banned. Union-run enterprise agreements are the name of the game.”
This is not true. All agreements under the FWA are ‘non-union’ agreements.
The union may start bargaining and be the prime movers throughout, but once
bargaining finishes (and even before that), the employer provides the
agreement to all employees for ballot and controls the decisions on how the
vote will be handled. The agreement is voted on by union and non union
workers and is considered “made” when a simple majority votes for it. It exists
between the employer and the relevant workers. Either the employer or union
lodges the agreement to FWA for FWA approval.
However, the union must
then apply to FWA for “coverage” under the agreement. The agreement is not
between an employer and the union.
Thus, agreements are being made and approved with a minority of or no union reps at the table.
Individual agreements (Workchoices AWA’s) are being phased out, new ones
are not available.
However, employers can still employ workers on individual
common law contracts provided they meet the minimum requirements of the Act.
21 Blame game misses need for IR reform, BY:PAUL KELLY, The Australian , November 02,
Individual workers cannot be forced into pay and conditions less than the
award or National Employment Standards.
Conclusion: let’s win some “unfinished business”
One hypocrisy of the Workchoices warriors is their claim to be champions of
However, in order to implement the deregulation they favour –
the employer’s right to shift to a precarious workforce, or to relocate to a low
wage haven overseas – they advocate repressive regulation that prevents
workers from pursuing job security clauses in their agreements, and from
taking industrial action that works.
They support the right of the employer to add more workers to the 40% now in
In short, repressive regulation that shackles the workforce is
good regulation, because it deregulates the workforce.
The golden rule of corporate Australia is that decisions like Qantas’ to
manipulate income, investment and profit from domestic operations to set up
overseas operations on a “cheap airlines” model is nobody’s business except
the board.22 These decisions should not be analysed or mediated by the
workers affected by them, especially through bargaining, nor the FWA, nor the
government, or the community generally. They are sacred ground.
The Qantas dispute was also an opportunity for the Liberal Party, in playing its
role on behalf of employers, to eat into the Labor Government’s control over
industrial relations policy. They sought to establish new proof that there is no
single area of policy that the government is actually in control of. How much
Alan Joyce, Leigh Clifford and some of the senior execs in Qantas engaged in
this is not definitely known. But, we know that something fishy was going on between Shadow Treasurer, Joe Hockey, and Qantas well before the lock out was announced. The Liberals are well versed in how to put together a conspiracy in industrial relations.
The YR@W campaign against Workchoices was a great victory “politically”. It made history. But industrially the FWA is a significant, but relatively modest reform. The workers and their supporters who fought that campaign deserved
a lot more.
The question now is, can we mobilise between now and through the period of
the review next year to win the improvements we need.
Can workers and union rights be pushed to the front again?
The strategic choice for the union movement, in the face of the Workchoices push, is to defend what has been achieved, or to push strongly to complete at
least some of the “unfinished business”; to build a lobbying and internet
activist effort in support or, to genuinely mobilise a YR@W style campaign to
attack Abbott and make the Labor government more Labour.
The Act must be amended to reduce the considerable powers still available to
employers to dodge genuine bargaining, and especially to take on the
· Get rid of the ABCC altogether.
· The right to bargain on job security issues without constraint. Job security is workers business.
· There must be industrial action rights to implement agreements after
they have been negotiated to counter the employer’s ability to breach
· The lock out powers for employers must be removed from the Act or at
worst constrained, perhaps limited by a tough requirement to apply in
advance (just like unions must on behalf of workers for PIA) and to
proportionality against the action being taken by workers.
· To include industry wide bargaining rights;
· To recognise the right to political and social strikes and forms of action.
If the new penal powers – termination and suspensions of industrial action
with consequent statutory fines and common law damages against workers
and their unions – are retained, then we must start to imagine and develop an
industrial strategy that leads to defiance that makes them unworkable.
The Victorian nurses are on the right track. When will there be more supporters and followers?
22 Roy Green, http://theconversation.edu.au/planes-set-to-fly-again-but-what-now-forqantas-
Don Sutherland is a National AMWU Industrial Officer