University of New South Wales Faculty of Law Research Series
|
|
Home
| Databases
| WorldLII
| Search
| Feedback
University of New South Wales Faculty of Law Research Series |
|
Last Updated: 19 December 2008
What about the worker?!
The move toward establishing a system of rights for employees.
Joellen Riley
Professor, Law Faculty
University of New South
Wales
JCA Colloquium 2008
Sunday 12 October 2008
Surfers
Paradise, Queensland
Abstract
This paper will consider whether a system based on private contracting by individuals has the capacity to develop a right to fair treatment at work; the extent to which common law principles are able to contribute to that development; some of the inadequacies of enforcement under the common law; and the need for additional support from other non-legal forms of ‘soft’ regulation. In particular, the paper will conclude with some observations on a current project of the Australian Institute of Employment Rights to develop a system of accreditation for employers who comply with a proposed Charter of Employment Rights. My subject is the establishment of a new system of rights for employees, or more accurately still, the establishment of a new approach to framing and recognising workers’ rights.
A new approach to workers’ rights
When I first accepted the invitation to address this
Colloquium on the topic, ‘What about the worker? The move toward
establishing a system of rights for employees’, I should probably have
proposed a modification to my headline. After all, it would not be true to say
that workers have
enjoyed no rights in Australia to date. Many on the far right
would probably complain that at times workers have enjoyed too many
rights, to
the detriment of Australia’s fulfilment of optimum economic advancement.
My subject is the establishment of a new system of rights for employees,
or more accurately still, the establishment of a new approach to framing
and recognising workers’ rights.
Traditionally, the Australian
industrial relations system has focussed on the establishment of workers’
rights through collective
means – generally by tribunals making
industry-wide awards to settle claims brought by trade unions. Today, however,
union
membership is in decline, and a new approach to industrial relations is in
the ascendancy. In the universities, ‘industrial
relations’
departments are being re-badged as ‘organisational management’
schools. The new social science of Human
Resources Management (HRM) is
displacing ‘IR’. HRM de-emphasises industrial relations as the
terrain for the negotiation
of the inherently conflicting interests of capital
and labour, and asserts instead a ‘unitarist’ conception of the
management
of work relations as a cooperative
endeavour.[1] And
HRM’s preferred regulatory tool is private ordering, through
contract.
This paper will consider whether a system based on private
contracting by individuals has the capacity to develop a right to fair
treatment
at work; the extent to which common law principles are able to contribute to
that development; some of the inadequacies
of enforcement under the common law;
and the need for additional support from other non-legal forms of
‘soft’ regulation.
In particular, the paper will conclude with some
observations on a current project of the Australian Institute of Employment
Rights
to develop a system of accreditation for employers who comply with a
proposed Charter of Employment
Rights.[2]
Political background
At around this time last
year,[3] we were in the
last weeks of a federal election campaign in which the Australian Council of
Trade Unions (ACTU) ran series of media
advertisements under the slogan,
‘Your Rights as Work’. The ACTU campaign attacked the Howard
government’s WorkChoices
laws,[4] and it
certainly appears that attack was effective. According to Roy Morgan polls
conducted ahead of the election, the WorkChoices
laws were the most significant
factor in voters’ support of a change of
government.[5]
WorkChoices brought radical change to Australia’s industrial relations
system in a number of respects, many of which are outside
my particular brief
here.[6] The aspect of
interest to me is the ideological agenda clearly driving many of the WorkChoices
reforms. WorkChoices demonstrated
a commitment to an individualistic,
contract-based model for establishing employees’ rights. In this respect,
WorkChoices’
rhetoric adopted the ascendant HRM approach to workplace
relations, and the legislation followed a globally-recognised trend, called
(in
many respects
inappropriately[7])
‘deregulation’.
Deregulation is the label given to the
‘widespread displacement of collectively-based regulatory strategies in
favour of individual
mechanisms of worker and employer
redress’.[8] It
is tempting to view this agenda cynically, as driven entirely by the power of
‘Global Capital’ seeking to improve
the share of productivity gains
going to profits at the expense of the share for Labour’s wages. And
indeed, National Accounts
data released on 3 September 2008, showed the
‘profits share’ of the Australian economy reached ‘a record
high
of 27.8 per cent in trend terms, the greatest share going to profits since
the ABS began collecting the data in the September quarter
of 1959’ while
at the same time the wages share ‘fell to 52.7 per cent’, the lowest
level since 1965.[9]
Nevertheless, there is also a view that some of the pressure comes from an
emergent individualism among the citizens of western
democracies. Hepple and
Morris have identified a rising ‘rights-based’ individualism as the
cause of considerable pressure
on western industrial relations systems, as
workers demand enforcement of these
rights.[10] So it is
perhaps not surprising that the ‘Your Rights at Work’ campaign
resonated with the electorate – even those
who were not affiliated with
trade unions.
A year on, those of us with a particular interest in
industrial relations law and policy are eagerly awaiting the tabling of new
laws
which promise more changes to Australia’s industrial relations
system.[11]
Indications from the new government’s press statements suggest that the
new laws will not simply reinstate the old industrial
relations model. It is
already clear that some of the new ‘Forward with Fairness’ measures
will accommodate options for
individual bargaining of working conditions,
notwithstanding the abolition of Australian Workplace Agreements (AWAs) by the
Workplace Relations Amendment (Transition to Forward with Fairness) Act
2008 (Cth).[12]
For example, the Award Modernisation
Decision[13] sets
out a ‘model award flexibility clause’ which contemplates individual
agreements. An individual employee may agree
with an employer to vary the
application of an otherwise binding modern federal award, so long as certain
protections of both a procedural
and substantive nature are observed.
Procedurally, the agreement must be in writing, and must be ‘genuinely
made’, without
coercion or duress. Substantively, the agreement may not
‘disadvantage the individual employee in relation to the individual
employee’s term and conditions of
employment’.[14]
There is also a suggestion in the Forward with Fairness Policy
Implementation
Plan[15] that the
new rules will allow an exemption from award coverage for employees on incomes
over $100,000, on the assumption that these
‘high income earners’
should be liberated to make their own deals about working hours and other
employment conditions.
Clearly, the proposed new laws anticipate a role for
private contracting in the regulation of working conditions, and many applaud
this approach, as a means of ensuring that individuals’ special needs can
be met in their working arrangements.
Private ordering and public regulation
This brings us to an essential question: can a system of workplace regulation based on private contracting deliver effective recognition and enforcement of the kinds of rights that workers are now asserting? Labour law orthodoxy would probably answer a resounding ‘no’. Shae McCrystal has undertaken some informal surveying of young Australian law students about what rights they believe they enjoy under the common law (absent any special statutory rules) when they accept employment:
‘Students are generally surprised to find that none of the controls that they assumed they would find around hours, wage rates, location of work, workloads . . . exist at common law. Instead, the principle of managerial prerogative and the right to terminate upon giving notice accords to employers an extremely high degree of control over their employees, with few if any restrictions around how they exercise that control.’[16]
This is all entirely true. Minimum rates of pay, controls on working hours,
protection of job security – all these and many
more
benefits[17] that
employees customarily enjoy in Australia flow from their entitlement to the
benefits of legislated standards and arbitrated
industrial awards. There will
always be a need for public regulation to maintain a safety net of basic working
conditions, because
there will always be a large class of workers who do not
enjoy sufficient bargaining power to secure decent conditions for themselves
in
a completely unregulated labour market.
[18]
Likewise, there is ample evidence that collective bargaining generally
produces better outcomes for workers than individual
bargaining.[19] So
statutory support for the enforcement of trade union-negotiated collective
bargains[20] has been,
and will continue to be, vital to the protection of those workplace rights taken
for granted by many in the community.
Indeed, the rights to freedom of
association and collective bargaining which are recognised under International
Labour Organisation
Conventions C87 Freedom of Association and Protection of the
Right to Organise 1948 and C154 Collective Bargaining Convention 1981,
are
fundamentally important in the maintenance of labour standards. Any system of
workplace rights must necessarily recognise those
collective rights, if it is to
claim that it produces just
outcomes.[21]
This
is all by way of an important disclaimer from the discussion that now follows
about the potential for the development of principles
that recognise rights at
work under the common law. My work in Employee Protection at Common
Law[22] has often
been criticised for failing to make this disclaimer sufficiently robustly. So I
repeat it again here: there will always
be a need for statutory intervention in
workplace
regulation.[23]
Nevertheless, it seems equally clear that statutory protections will be limited
to a very basic safety net of wages and conditions.
Any claim to benefits above
that safety net must now generally be pursued by negotiation and enforcement of
workplace bargains.
Increasingly, those bargains are individual contracts.
If individual agreement-making is to be encouraged as a principal tool for
establishing workplace rights, those individual agreements
will sometimes
require enforcement. We have generally looked to the principles of the common
law of contract when it comes to upholding
private bargains, although in some
areas, those rules and principles have been modified or complemented by statute.
To what extent
does the common law presently recognise any ‘rights at
work’? And, just as important, how effective is common law enforcement
of
any such rights?
‘Fair dealing’ and employment contracts
Some of the television advertisements in the
ACTU’s pre-election campaign focused on WorkChoices’ withdrawal of
statutory
unfair dismissal protection for many
workers.[24] These
advertisements appealed to a community expectation that people should enjoy a
right to a certain level of job security: people
ought not be subjected to
capricious and arbitrary treatment at work, and ought not to be sacked
unceremoniously without a valid
reason. This ‘right’ has certainly
been claimed in a number of termination of employment cases brought under the
common
law in recent times. These cases allow us some insight into whether the
common law is evolving principles which regard a right to
fair dealing at work.
A claim to fair dealing is generally framed in terms of the
employer’s obligation not to act in a way calculated to destroy
the
relationship of mutual trust and confidence between the employer and employee,
although in the United Kingdom it has been expressed
as a duty of ‘fair
dealing’ for some time
now.[25] In the United
Kingdom, the ‘rapid evolution’ of this principle has been the
subject of ‘very extensive and significant
case law development’.
[26] Even there,
however, ‘[t]he nature, content and scope of this principle are not fully
defined; indeed, in some respects they
are keenly
controversial.’[27]
This
is a huge topic, and could well be the subject of a complete book. For the
purposes of this paper, I would make just a few
brief observations on Australian
developments.
1. There is a duty of mutual trust and confidence, or good faith and fair dealing in employment relationships.
Firstly, notwithstanding frequent assertions that this duty is not established under Australian law and has yet to be affirmed by an appellate court,[28] it is clear that the courts in many jurisdictions are assuming the existence of duty. Most recently it has been applied in the Supreme Court of South Australia in McDonald v State of South Australia,[29] and by the Supreme Court of New South Wales in Downe v Sydney West Area Health Service (No 2).[30] The New South Wales Supreme Court was prepared to concede its existence in Russell v Trustees of the Roman Catholic Church for the Archdiocese of Sydney.[31] The duty was clearly assumed by the High Court of Australia in Koehler v Cerebos (Australia) Ltd,[32] in the statement (at paragraph [24] of the judgment:
‘it is only when the contractual position between the parties (including the implied duty of trust and confidence between them) "is explored fully along with the relevant statutory framework" that it would be possible to give appropriate content to the duty of reasonable care . . .’ [my emphasis].
In my view, it is no longer useful to
debate the existence of a duty not to destroy mutual trust and confidence. What
requires attention
now is its scope. What kind of conduct does observance of
the duty require on the part of the employer? In what circumstances will
the
duty be breached? Case law is now beginning to develop particular examples and
instances of the duty and its breach, however
in Australia – as in the
United Kingdom – this is still contested terrain.
2. This duty alone does not restrict the freedom of an employer to terminate the employment contract with proper notice.
The second observation flows from the question concerning the scope of the duty. Clearly, the duty of mutual trust and confidence or fair dealing does not require that an employer engage the worker perpetually. Under the common law, an employer is still entitled to terminate an employment contract by giving the required period of notice under the employment contract, and is not obliged to offer any particular kind of reason for the decision to terminate. Those cases which have found that the employer is only entitled to terminate the contract for cause are cases where the employment contract included an obligation not to dismiss without reasons. In Balsdon v Murray Irrigation Ltd,[33] for example, Ashford J in the District Court of New South Wales held that Mr Balsdon’s dismissal was in breach of the employer’s obligation not to dismiss on ‘harsh, unjust and unreasonable’ grounds. This obligation had been incorporated as a term of the employment contract from an enterprise bargain. This finding was confirmed on appeal by Bryson JA (with whom Handley and Ipp JA agreed).[34] Sometimes, an obligation not to dismiss without conducting a proper enquiry and establishing a good reason will be incorporated into the employment contract from a human resources policy.[35] It is still the case, however, that absent such a contractual term, employers enjoy a common law right to terminate employment contracts for any reason or no reason at all, so long as they observe the terms of those contracts.
3. The good faith obligation assists in the construction of the terms
of an employment contract.
A third point flows from this, and
that is that in many cases the most important questions to be resolved in a case
relate to construction
of the contract. If the employer is obliged to give
proper notice in order to terminate, then a fundamental issue to be resolved
will be the period of notice required. This, I believe, is where the mutual
trust or fair dealing obligation is doing some important
work, albeit invisibly.
The full federal court decision in Walker v Citigroup Global Markets
Australia Pty
Limited[36]
is a good illustration of this point. In that case, the court was faced with
some conflicting evidence as to the terms of the employment
contract. On the
one hand there was correspondence which indicated that the parties expected the
engagement to last for at least
a year: there was a guaranteed bonus for the
first year, and a commitment to promote the employee, or at least confer a more
illustrious
title on him, after the end of the first year of engagement. On the
other hand, there was a set of standard term ‘conditions
of
employment’ attached to his ultimate letter of offer which stipulated that
the engagement could be terminated with one month’s
notice.
At first
instance, it was held that the standard term conditions prevailed. The other
promises about longer term employment were
held to be representations only. As
misleading and deceptive representations, they were held to sound in a claim for
compensation
for breach of section 52 of the Trade Practices Act 1974
(Cth). On appeal, however, the full court held that the commitments evidenced
in the correspondence between the parties during negotiations
were contractual.
The court was guided by the general principle of contract construction that
‘[w]here there are clauses in
a contract specially framed with the
individual circumstances in mind, together with standard form clauses, it will
normally be appropriate
to give greater weight to the specially negotiated
clauses’.[37]
The circumstances of the recruitment assisted the court to this conclusion. It
was held that ‘the purpose and object of the
transaction, namely the
recruiting of a high level and high profile employee then in other
employment’ made it a ‘practical
absurdity’ that the parties
would have agreed to a clause allowing termination on only one month’s
notice, and a consequent
avoidance of any obligation to pay the promised
guaranteed
bonus.[38]
In my
humble view, this is evidence of an approach to contract construction that
assumes good faith and fair dealing between the parties.
The court looked to
the ‘purpose and object’ of the contract, and the expectations of
‘business people active
in the financial world’, and assumed that
they were committed to cooperating in allowing the other the benefit of the deal
they had made. They were not permitted to rely opportunistically on the written
terms of a form attached to their contract.
Of course, the court did not
expressly describe this as a ‘good faith’ obligation. In fact,
Kenny J at first instance
held that the court should not imply a duty of
good faith in employment contracts, and the full bench said that it was not
necessary to determine whether there was
such an obligation to resolve the
appeal. I would argue however, that the process of construing a contract on the
basis that the
parties must be assumed to be committed to performing the
contract according to the reasonable expectations of prudent business people
negotiating such transactions is to apply a good faith standard. This is all
that good faith implies. Good faith does not oblige
a contracting party to
volunteer new benefits to a counterparty. It requires only faithful observance
of the agreement made. It
requires respect for the spirit of the agreement, and
disallows opportunistic manipulation of some technical flaw in its form.
[39]
The third point above shows that the good
faith obligation is a principle of construction of employment contracts. The
obligation
not to destroy mutual trust and confidence is not a ‘stand
alone’ term of the contract, so breach does not give rise
to damages
independent of any entitlement to be compensated for losses caused by early
termination. Generally, breach of mutual
trust and confidence by the employer
allows the employee to treat him or herself as constructively dismissed, and
then to claim expectation-based
damages on the assumption that they would have
remained employed until the employer could legitimately have terminated the
employment.
The quantum of damages will therefore be largely determined by what
the employee would have earned during a reasonable period of
notice. In some
cases, employees may also be able to substantiate a claim for ‘loss of
chance’ damages, based on the
fact that premature dismissal has caused
them to lose other opportunities, for example,
promotion.[40]
There is one contested exception to the principle that damages are based
only on what would have been earned during the proper period
of notice, and that
is the increasingly common claim for some kind of general damages based on
mental suffering.
The treatment of claims for psychiatric harm tends to
divide the English and the Australian decisions. English cases have been
prepared
to allow recovery of damages under contract for breach of the mutual
trust and confidence obligation when the damage sounds in some
kind of medically
treated mental
illness,[41] but only
so long as the mental suffering was due to conduct occurring during employment,
and did not arise only as a consequence
of the fact of early
termination.[42]
Australian cases have tended to treat these kinds of claims as damages flowing
not from a breach of mutual trust and confidence,
but from breach of a duty to
provide a safe workplace (a duty which arises concurrently in tort and
contract).[43]
However the duty is described, Australian cases have awarded damages to
compensate for serious mental illness, so long as the employee
has been able to
establish that the harm was the foreseeable consequence of a breach of the
employer’s duty of
care.[44]
The problem of enforcement
The principles outlined above suggest that in recent
times the common law of employment contracts has evolved to develop some
principles
of fair dealing. Australian development may not have kept pace with
developments in the United
Kingdom,[45] however
there have been advances in recent years. Some badly treated employees have been
able to secure substantial damages awards
based on the courts’ willingness
to find that the employer’s breach of a duty of mutual trust and
confidence or a duty
of care has caused a premature termination of the
employment relationship, causing compensable harm. The damages awards in some of
these cases have been considerably more generous than awards in statutory unfair
dismissal cases, where there is a cap on compensation.
And if anecdotal reports
from law firms practising in this field are reliable, the litigated cases are
the tip of an iceberg of cases
being negotiated and settled in the shadow of
these important court decisions. It is tempting to conclude, therefore, that a
system
of private contracting can support recognition of a worker’s right
to fair dealing at work, at least in so far as that claim
protects the worker
from a capricious and arbitrary summary dismissal.
The problem, however, is
that many aggrieved employees cannot afford even preliminary legal advice about
their claims, let alone
legal representation in
court.[46]
Court
processes are notoriously expensive, time-consuming, and one wonders if the
court process itself is not a significant contributor
to the mental distress
suffered by employees who find themselves in the odious position of having to
litigate to vindicate their
claims to recognition of their rights.
In other
fields we have established specialist tribunals to deal quickly, inexpensively
and informally with disputes involving small
claims brought by certain classes
of vulnerable persons, for example, the Residential Tenancies Tribunals in each
State. For some
reason, the former government in its Work Choices laws chose
to limit the jurisdiction of State and federal industrial relations
tribunals to
deal with individual grievances according to their customarily more informal
processes. Instead, employees claiming
recognition of a workplace right under
the Workplace Relations Act are presently faced with a choice: litigate
before the Federal Magistrates Court, or opt to follow the model dispute
resolution
procedure set out in the Workplace Relations Act Part 13.
This model procedure leads the complainant to an ‘alternative dispute
resolution’ (ADR) process.
The first step in the Model procedure set
out in the Workplace Relations Act is that the parties must attempt to
resolve the matter at the workplace
level.[47] If that
proves futile the parties can refer the matter to a private ADR provider, or may
resort to private ADR services provided
by the Australian Industrial Relations
Commission (AIRC), however the AIRC will not have the power to compel any person
to do anything,
and will only have the power to arbitrate the dispute if the
parties agree to
arbitration.[48]
Essentially, this leaves the resolution of the dispute in the hands of the
parties themselves.
Here we see the HRM agenda at work: the model dispute
resolution process assumes that the parties themselves, as robust individuals
capable of negotiating their own mutually satisfactory terms, should be free to
determine their own rights. This assumption ignores
the conventional complaint
about the inherent inequality of bargaining power between the individual worker
and the
employer.[49]
The
model process applies even in a dispute over the application of a legislated
minimum working condition in the Australian Fair
Pay and Conditions
Standard.[50] The
model process tolerates the idea that even those standards fixed by apparently
mandatory public regulation should be able to
be negotiated away by private
contract at the point of resolution of a dispute. Certainly, parties maintain
their right to litigate,
but for many impecunious workers without recourse to
legal assistance, this is an illusory benefit.
An alternative, non-legal model?
The picture painted above is the usual bleak picture
of inadequate access to justice for the weaker members of our community. We
could seek to improve access to informal tribunals for the vindication of
workplace rights (and it remains to be seen whether the
new ALP government
chooses to confer such a jurisdiction on a new judicial arm of the promised Fair
Work Australia body). Or we
could try an entirely different approach. The
Australian Institute of Employment Rights (AIER) is presently working on a
project
which seeks to do just that.
The AIER is an independent body
funded and governed entirely under the terms set out in its rules of
association. Its current patron
is former Australian Prime Minister, the Hon
Robert J L Hawke, and it is inspired by the same tripartite philosophy that
underpinned
the Accord promoted by his government in its
day.[51] One of the
AIER’s major projects has been the formulation and dissemination of a
proposed Charter of Employment
Rights.[52] This
Charter identified ten workplace rights, many of which are expressed as
reciprocal rights (i.e. rights to be enjoyed by both
workers and employers).
The ten rights or principles are:
A second phase in the AIER’s mission is to
promote voluntary adoption of these principles in Australian workplaces. It is
presently
working on an accreditation scheme, whereby employers would apply for
accreditation as a Charter-compliant employer. The benefit
to the employer
would be an ability to claim itself a ‘best practice’
‘employer of choice’, and so compete
favourably in the market for
skills and talent. The process of accreditation would involve an assessment of
the employer’s
practices, through means including surveys of staff. The
process of conducting the surveys would itself be a means of disseminating
the
aspirations of the Charter throughout workplaces.
The AIER’s Charter of
Employment Rights and proposed accreditation scheme appeals to the
‘rights-discourse’ of our
present times, and also to the noblest
versions of the HRM literature, which argue that there is a business case for
respecting workers’
rights and thereby earning their cooperation and
support for business goals. As a form of regulation (in the broadest sense of
the
word) this is ‘soft law’. Parties are persuaded to sign up to
voluntary codes of conduct, and to commit to compliance.
Sanctions are
persuasive rather than coercive: the shame of withdrawal of accredited status is
likely to be the most serious ‘penalty’
the AIER would be able to
impose. Nevertheless, good publicity is generally seen as a great benefit in
fostering business success.
Consumers of a firm’s goods and services are
also audiences to news of a firm’s conduct in respect of its
staff.
Perhaps if this accreditation scheme were to be widely adopted we
might one day see arguments in court cases that the Charter has
been
incorporated by reference or implied by custom and practice or a course of
dealing into an employment contract. That, however,
is not the goal of the
project. If successful, the great value of this kind of scheme is that it
intends to be preventative. Reading
the facts of cases such as
Naidu,[53]
Nikolich[54]
and
McDonald,[55]
is deeply frustrating. Great harm can follow from capricious disregard and
abusive treatment of workers. It is not only their working
lives that suffer.
These workers also suffered serious dislocation to their family lives and their
personal health. No amount of
monetary compensation mends that harm. Prevention
of this kind of harm, through the education of employers and their managerial
and supervisory staff is certainly a worthy goal of workplace regulation. If
that can be achieved by voluntary ‘soft’
forms of regulation, all to
the better.
If the accreditation scheme is successful in persuading firms to
observe the kinds of principles set out in the Charter of Employment
Rights, the
kind of employer conduct causing the grievances in the ‘mutual trust and
confidence’ case law may be prevented.
Charter compliant employers would,
for instance, ensure that supervisors did not abuse their staff (Naidu).
They would institute fair and reasonable performance review systems
(McDonald); they would prudently investigate any allegations of
impropriety against employees before acting precipitately (Gogay,
Russell), and they would respectfully follow up repeated complaints from
employees (Nikolich, McDonald). They would certainly not trump up
malicious complaints against their staff (Eastwood v Magnox). And so a
great deal of personal grief, and an enormous amount of business time, finances
and resources, would be saved.
Conclusion
In remaking Australian workplace relations laws to
regulate for ‘fair work’, the new the federal government faces
particular
challenges. Allowing individual arrangements for the kinds of
flexibility claimed by employers and many employees is likely to require
some
kind of individual contracting over working conditions. How much supervision of
private bargaining is to be provided, and whether
new avenues for recognition
and enforcement of rights are to be created, remain to be seen.
Although
the common law in Australia has begun to recognise rights to fair dealing at
work through the gradual evolution of a reciprocal
duty of mutual trust and
confidence in employment relationships, reliance on the common law as the sole
means for enforcement of
workers’ rights is unsatisfactory. The very fact
that an employer’s counsel can sometimes vigorously argue the absence
of
any duty to an employee, even in the face of the most compelling evidence of
appalling behaviour and serious harm, is testimony
itself to the unsatisfactory
service provided by the common law in this field.
Perhaps we should now be
grasping the present opportunity to re-regulate Australian workplace relations,
to engage in some serious
rethinking about how workplace rights should be
developed and recognised. I for one will be watching the development of the
AIER
Charter of Employment Rights and accompanying accreditation project with
great interest. It may provide the opportunity for some
close study of whether
the HRM theories of organisational behaviour upon which much of the recent
rhetoric about workplace law reform
has been built can indeed be harnessed to
develop fairer and safer working environments, and to establish clearly
articulated and
reliably recognised rights for Australian workers.
[1] S Deery et al
Industrial Relations: A Contemporary Analysis,
2nd ed, 2001, Irwin/McGrawHill, Sydney, at p 37. HRM
comes in ‘soft’ but also ‘hard’ versions. The more
benign
‘soft’ version was not adopted in any of the Howard
Government’s industrial relations reforms, according to S Deery
and J
Walsh ‘The character of Individualised Employment Arrangements in
Australia: A model of “Hard” HRM’
in S Deery and R Mitchell
(eds) Employment Relations: Individualisation and Union Exclusion, An
International Study, 1999, Federation Press,
Sydney.
[2] See M
Bromberg and M Irving (eds) Australian Charter of Employment Rights
(2007) Australian Institute of Employment Rights, Hardie Grant Books,
Melbourne.
[3]
Australians voted in a new ALP Federal Government on 24 November
2008.
[4]
Workplace Relations Amendment (Work Choices) Act 2005 (Cth)
(WorkChoices)
[5]
See ‘IR Reforms Still Driving Labour Support: Liberal Voters Afraid of
Union Dominance’, June 18, 2007, at http://www.roymorgan.com/news/polls/2007/4179
last checked 14 May
2008.
[6] See for
example the challenge to federalism raised by the use of the corporations power
in the Constitution s 51(xx) to override State industrial regulation: G Craven,
‘Industrial Relations, the Constitution and Federalism: Facing the
Avalanche’ [2006] UNSWLawJl 11; (2006) 29(1) UNSW Law Journal
203.
[7] See H
Collins ‘Regulating the Employment Relation for Competitiveness’
(2001) 30 Industrial Law Journal 17 for the view that resort to contract is a
different form of regulation, not an absence of regulation. See too A Stewart
‘Procedural
Flexibility, Enterprise Bargaining and the Future of Arbitral
Regulation’ (1992) 5 Australian Journal of Labour Law 101 at
101.
[8] J Conaghan,
‘Labour Law and “New Economy” Discourse’ (2003) 16
Australian Journal of Labour Law 9 at
19.
[9] ‘Profit
share of economy hits 50 year high’, Workplace Express, 3 September
2008, http://www.workplaceexpress.com.su/nav?id=37569&no=703592232,
last checked 5 September
2008.
[10] B Hepple
and G Morris (2002) ‘The Employment Act 2002 and the Crisis of Individual
Employment Rights’ (2002) 31 Industrial Law Journal 245 at
247.
[11] No Bill
was available at the time of writing (10 September
2008).
[12] This
legislation took effect from 28 March
2008.
[13] AIRC,
PR062008, 20 June 2008; [2008] AIRCFB 550, at par
[187].
[14]
Ibid.
[15] K Rudd
and J Gillard, Forward with Fairness: Policy Implementation Plan,
Australian Labor Party, Canberra, August
2007
[16] S
McCrystal ‘Re-imagining the Role of Trade Unions After WorkChoices’
(2008) 18(2) Economic and Labour Relations Review 63 at
64.
[17] For
example, freedom from discrimination on the grounds of sex, race, disability,
etc.
[18] See K W
Wedderburn The Worker and the Law (1986) Penguin, England, at p.5:
‘. . . the individual worker brings no equality of bargaining power to the
labour market and
to this transaction central to his life whereby the employer
buys his labour power’. See also R Johnstone and R Mitchell,
‘Regulating Work’ in C Parker et al Regulating Law, (2004)
OUP, Oxford, at p
119.
[19] For
example, figures released by the Office of the Employment Advocate (OEA)(which
is now renamed the Workplace Authority) in May
2006 showed that from a sample of
250 AWAs, every one removed at least one ‘protected award condition’
and 16 per cent
removed all such conditions: P McIlwain Evidence to Estimates
Hearing, Senate Committee on Employment, Workplace Relations and Education,
Parliament of Australia, Canberra, 29 May 2006. Data allegedly leaked from the
OEA also revealed that 44 per cent of a sample of
998 AWAs removed all protected
award conditions; 76 per cent removed shift loadings, 70 per cent removed
incentive payments and bonuses
and 59 per cent removed annual leave loading: see
M Davis ‘Revealed: How AWAs Strip Work Rights’, Sydney Morning
Herald, 17 April 2007; M Davis, and M Schubert, ‘Workers’ Rights
Lost with AWAs’, The Age, 17 April 2007, noted in C Sutherland and
J Riley ‘Industrial Legislation in 2007’ (2008) 50(3) Journal of
Industrial Relations 417 at
419.
[20] For an
analysis of the weaknesses of the common law in enabling collective bargaining
see A Stewart and J Riley ‘Working Around
Work Choices: Collective
Bargaining and the Common Law’ [2007] MelbULawRw 35; (2007) 31(3) Melbourne University Law
Review 903 at
920-927.
[21] See M
Irving ‘Union Membership and Representation’ in M Bromberg and M
Irving (eds) Australian Charter of Employment Rights (2007) Australian
Institute of Employment Rights, Hardie Grant Books,
Melbourne.
[22] J
Riley Employee Protection at Common Law (2005) Federation Press,
Sydney.
[23] Ibid
at p.2. See particularly fn 1 which reads: ‘This work is by no means a
manifesto supporting the destruction of all forms
of collective regulation. This
work should never be cited as an apology for the neo-liberal
agenda.’
[24]
In particular, the so-called ‘small business’ exemption for
employers with fewer than 101 employees by s 643(10) removed
protection for many
workers. According the AIRC’s Annual Report for the Year ended 30 June
2007, unfair dismissal hearings
fell from 6707 in the year ended June 2005 (the
last full year before the introduction of WorkChoices on 27 March 2006) to 5758
in
the year ended June 2007. Given that WorkChoices also abolished access to
State unfair dismissal schemes for employees of private
sector employees, it is
surprising that the numbers of cases before the AIRC did not rise over
this period.
[25]
See D Brodie ‘A Fair Deal At Work’ (1999) 19 Oxford Journal of
Legal Studies
83.
[26] M
Freedland The Personal Employment Contract (2003) Oxford University
Press, Oxford, at
p.154.
[27]
Ibid.
[28] See for
example Heptonstall v Gaskin (No 2) [2005] NSWSC 30 per Hoeben J at
[23].
[29]
[2008] SASC
134.
[30] [2008]
NSW 159.
[31]
[2008] NSWCA 217 per Basten JA at [33] and Campbell JA at
[73].
[32] [2005] HCA 15; (2005)
222 CLR 44.
[33]
Unreported, DC159/2004, 19 September
2005.
[34]
Murray Irrigation Ltd v Balsdon [2006] NSWCA 253 at
[25].
[35] See for
example Rispoli v Merke Sharpe & Dohme (Australia) Pty Ltd [2003]
FMCA 160.
[36]
[2006] FCAFC 101 (23 june
2006).
[37] At
[77].
[38] At
[76].
[39] See J W
Carter, E Peden and G J Tolhurst Contract Law in Australia,
5th ed, (2007) Lexis Nexis Butterworths, Sydney at pp
26-27 for an authoritative view that good faith means ‘not acting
arbitrarily
or capriciously; not acting with an intention to cause harm; and
acting with due respect for the intent of the bargain as a matter
of substance,
not
form’.
[40]
See Walker v Citigroup, above n.36 and McDonald v South Australia,
above n.29.
[41] See Gogay
v Hertfordshire County Council [2000] EWCA Civ 228; [2000] IRLR
703.
[42] This
awkward distinction was confirmed by the House of Lords in Eastwood v Magnox
Electrix plc [2004] UKHL 35; [2004] 3 WLR
322.
[43] See for
example Naidu v Group 4 Securitas Pty Ltd [2006] NSWSC 144, and
Goldman Sachs J B Were Services Pty Ltd v Nikolich [2007] FCAFC
120.
[44] See for
example Patrick Stevedores (No 1) Pty Ltd v Vaughan [2002] NSWCA 422, and
State of NSW v Seedsman [2000] NSWCA 119; (2000) 217 ALR
583.
[45] See for
example BG plc v O’Brien [2001] IRLR 496, where it was held that
the duty obliged the employer to be even-handed between employees in conferring
redundancy
entitlements.
[46]
Mr McDonald was ultimately self-represented in his action before the Supreme
Court of South
Australia.
[47] See
Workplace Relations Act 1996 (Cth) s
695.
[48] Ibid, s
701.
[49] See
Wedderburn, above n.18.
[50]
Ibid, ss 699(1)(a); 694(2) note (a) and
175.
[51] See R J L
Hawke’s Foreword in Bromberg and Irving, above n.2, at
xi.
[52] See
Bromberg and Irving above n.2.
[53]
Naidu v Group 4 Securitas Pty Ltd [2006] NSWSC
144.
[54]
Goldman Sachs J B Were Services Pty Ltd v Nikolich [2007] FCAFC
120.
[55] [2008]
SASC 134.
AustLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.austlii.edu.au/au/journals/UNSWLRS/2008/64.html