Union leader Paul Howes has called for an end to political point-scoring over industrial relations. Photo: Glenn Hunt
One of Australia’s most senior union officials has criticised the industrial relations system for “dragging Australia down” and fired a broadside at “criminals” who betrayed the union movement and hijacked its agenda.
Australian Workers Union chief Paul Howes has called for a “grand compact” between business and unions to take the heat out of the industrial relations debate and admitted wages in some sectors had increased too quickly.
Mr Howes warned the resources boom was now over and that Australia faced a jobs crisis, with 130,000 losses since the global financial crisis and “tens of thousands more lie just around the corner”.
Mr Howes urged his comrades in the union movement to concede there had been a pattern of unsustainable wages growth in some sectors of the economy, adding “we could be pricing ourselves out of the market”.
But he urged business to concede that on an economy wide basis, industrial disputes had fallen and wages growth had slowed.
“Perhaps they [business] might agree – penalty rates and the minimum wage are fundamental planks of our social contract and should remain.”
The union national secretary said the industrial relations see-saw in Australia, which has seen a range of legislative changes in the last decade and a half and contributed to a “perpetual instability” in the IR system.
“Some will tell you that our industrial relations system is dragging us down.
“And I won’t be popular amongst my friends in the labour movement for saying this – but I agree,” he said.
“This culture of perpetual instability means business and unions believe – quite reasonably – they don’t need to co-operate today – because they’ll be able to rewrite the rules tomorrow.”
In comments that will put him at odds with some of his fellow union officials, and some in the Labor Party, Mr Howes said both sides of politics had engaged “in wild, overblown claims about how disastrous the legislation of the day is.”
Mr Howes called for a “circuit breaker” to end industrial relations law changes to provide some of the stability that existed in the form of Accords agreed during the Hawke/Keating era.
“A grand compact is not just possible, it’s desperately needed. A grand compact in which business, unions and government all work out a deal that we all agree to live with for the long haul.”
“A bitter, all-out war between labour and capital will not end with productivity gains. The federal government needs to realise that its primary role is actually to take a few steps back – and to use that perspective to start fostering harmony and co-operation.”
Mr Howes’ comments come as the federal government prepares to launch a Productivity Commission inquiry into the Fair Work Act, and as it attempts to restore the building industry watchdog.
They also come as the Abbott government urged the Fair Work Commission to take a softening economy and labour market into account as the industrial umpire reviews modern awards and flagged concerns about penalty rates.
On the allegations of corruption in the construction union, first revealed by Fairfax Media last week, Mr Howes said union members had been betrayed, dishonoured and undermined.
“We must not allow this treachery to define us. We must not allow the traitorous minority to usurp the meritorious majority,” he said.
“If we turn a blind eye – if we ignore any pocket of dishonesty – it will grow like a cancer. It is my job – and the job of every union leader – to cut that cancer out.”
The federal government has signalled it is moving towards broadening out a promised judicial inquiry in the Australia Workers Union slush fund scandal into a full blown Royal Commission.
Earlier on Wednesday, Labor leader Bill Shorten slammed the idea that penalty rates would be cut, saying Mr Abbott had “no idea of how millions of people earn their pay”.
“Penalty rates aren’t going to the big end of town,” he told reporters in Melbourne.
“These are people who require that extra money when they work the unusual shifts, the family pressuring shifts … they deserve to be able to at least expect that their government doesn’t have their hand in the pocket of ordinary workers, trying to take away their conditions.”