10/08/2015 - 15:56

More needed on IR: Minerals Council

10/08/2015 - 15:56

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The Minerals Council of Australia has added to the national industrial relations debate today with a report it said showed that levels of union membership were unlinked to the labour force’s share of national income.

The share of national income allocated specifically to employees has changed little since the mid-1980s.

The Minerals Council of Australia has added to the national industrial relations debate today with a report it said showed that levels of union membership were unlinked to the labour force’s share of national income.

The share of national income allocated specifically to employees had changed little since the mid-1980s, despite a precipitous drop in union membership, the report undertaken by Castalia Strategic Advisors said.

“A common narrative is that this period has seen the triumph of ‘neo-liberalism’, which promotes the interests of capitalists at the expense of the workers,” the report said.

“Clearly, the remarkable constancy in how national income is shared between workers and capital owners belies this narrative.”

The report also suggests that enterprise agreements don’t consistently yield better results than individual agreements, the council said. 

It comes after the Productivity Commission released its draft report into the workplace relations framework last week, and broadly gave a tick to the national employment system.

A major recommendation of that paper was equalising Saturday and Sunday penalty rates in industries such as retail and hospitality.

Minerals Council of Australia deputy chief executive John Kunkel said that a key part part of the national industrial relations system was that it empowered union insiders by design.

“Put simply, this evidence does not support an ideological fixation with intervention and regulation to correct for an imbalance of bargaining power,” he said.

“The authors note that the Fair Work Act has strengthened union rights and preferences, for example by removing the non-union enterprise bargaining stream originally introduced by the Keating government in 1993.

“Sundakov and Schur (the authors) stress instead the need to design labour market policy in a way that ensures collective bargaining institutions perform for the benefit of intended beneficiaries (in light of the so-called 'principal-agent problem').

“The paper cites the Royal Commission into Trade Union Governance and Corruption as highlighting some of the unintended consequences of protecting collective bargaining organisations from competitive pressures.”

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