We could all go on strike

Those of us of a certain age may remember times in the 1980s and 1990s in Australia which were punctuated by crippling industrial actions including the infamous waterfront disputes. These strategies were arguably effective in creating leverage for workers to bargain with employers for better conditions. But some of the larger strike actions came at a significant cost to the economy. In reality, a right to strike in Australia has been restricted for a long time. In more recent times, in an effort to avoid some of the economic headaches of previous decades, the Federal Government has introduced some restrictions to industrial actions, including the regulation of who, why and when employees may strike.

Under the Fair Work Act, employees cannot lawfully strike during the life of an enterprise agreement (although all such agreements contain mechanisms for resolving disputes). Employees may only lawfully strike during a limited period of time when negotiating the terms of a new agreement. Even then, their actions are limited to the business in which they work. Industry-wide “pattern” bargaining is strictly prohibited. And they can only take industrial action in limited circumstances, such as:

  • good faith bargaining fails
  • an application is made to the Fair Work Commission outlining the bargaining failure, and obtaining approval to run a ballot among employees to pursue industrial action
  • a “protected action ballot” is conducted detailing the proposed industrial action and is agreed by a majority of workers.

If industrial action falls outside of this prescriptive process, then the industrial action will be unlawful. The Fair Work Act provides for substantial penalties, including fines, which may be levied on unions and individuals for pursuing unlawful industrial action.

This seems a far cry from the Australia’s early days and international reputation as a pioneer of workers’ rights.

This issue has been in the spotlight recently – at least in NSW – in connection with industrial protest affecting Sydney’s rail network. The unions have been having an ongoing stand-off with the NSW Government over a number of issues, mainly wage increases, as well as claimed safety concerns.

Some people who are following this in the news might be asking “what is this actually about?”, and “Why is the Fair Work Commission involved?”.

Both sides have utilised the Fair Work Commission to support their respective causes during the dispute, with the Unions seeking official sanction of the Commission to continue the strike action, and the NSW Government seeking to have the strike action deemed unlawful.

The parties have been negotiating the terms of a new enterprise agreement since around 2021. In August 2021, the Unions sought and obtained orders from the Commission to engage in protected industrial action. In July 2022, the NSW Government made an application to the Commission to terminate or suspend the Unions’ industrial action. The grounds for the NSW Government’s application included that the Unions’ industrial action was aimed at disrupting or impeding cleaning and maintenance of rail services and infrastructure, which would pose a risk to the health and safety of contractors working on rail lines and also commuters. It also argued that the strike action would cause significant economic damage.

However, the Commission has sided with the Unions. They have argued that safety and the convenience of commuters has been a paramount concern and has driven the decisions about what industrial action to pursue. For this reason, the Commission held that the industrial action which has been proposed does not cause a risk to health and safety. Similarly, the Commission found that the arguments of the NSW Government about the economic impact fell flat. While the NSW Government put forward evidence of huge costs as a result of the industrial action, the Commission found that these figures were only estimates, and that the short duration of the industrial action proposed was unlikely to have the significant economic impact required to support an order for the action to cease.

After checking the legals, the Unions have now made a further application to the Commission to include switching off Opal card readers as protected industrial action.

Every step of the way, the Union must continue to comply with the restrictions set out under the Fair Work Act in order to keep their protest lawful and thereby ensuring they maintain legitimate bargaining pressure on the employer.

A right to strike is considered a fundamental human right in many parts of the world. Because of Australia’s storied history of workers’ rights and its reputation generally as having deeply enshrined protections for employees, it is easy to assume that this right is alive and unfettered here. The reality is that Australian workers’ rights to strike are quite limited.

However, low wage growth, and high levels of inflation are factors building pressure on employers to improve pay and conditions.  We may see more industrial action as a result.  Employers would do well to be prepared for this.

Lessons for Employers:

Employers should:

  • Carefully review the dispute resolution clauses in any enterprise agreement or modern awards that apply to the business and its employees
  • Be aware of time frames for the expiry of any enterprise agreement, or when they intend to terminate or renegotiate the terms of an enterprise agreement
  • Prepare for the potential impacts of industrial activity which can be lawful during those negotiation periods
  • Be aware of their rights under the Fair Work Act to terminate or suspend industrial activity which is unlawful

If you would like to discuss these or other workplace issues please contact Andrew Bland or call 02 9412 3077.

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