09/11/2011 - 10:50

Qantas dispute throws up no winners

09/11/2011 - 10:50

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Qantas management is acting to secure the brand’s future.

Qantas management is acting to secure the brand’s future.

THE industrial relations furore surrounding Qantas has done more than put the focus on the federal government’s Fair Work laws, which have handed more power to unions.

By virtue of the players in the debate – especially pilots – it has concentrated attention on what people get paid and whether someone earning $400,000 a year ought to be striking to maintain their wages.

At that salary altitude, the image of the burdened employee hits a bit of turbulence in the court of public opinion.

I think that hardened the public attitude to this strike in particular and has helped draw attention to what the new workplace laws are doing – allowing well-paid people to take industrial action that is not commensurate with what they are demanding.

It is the flip-side of the CEO salary debate, which has also arisen in this issue.

CEOs have been portrayed as greedy and wanting more than any normal person could want.

The same can be said for employees. Why should someone who has more than enough money to feed their family, own a home, pay for their retirement and afford regular holidays be able to hold a company to ransom, let alone passengers and the nation? I am not just talking about pilots here.

Strikes are meant to be extreme measures, brought about due to frustration with conditions that a normal person, putting in a hard day’s work, ought not have to deal with. Unsafe working conditions, wages below the poverty line, truly unfair dismissals and numerous other situations can be worthy of strike action. History shows that strikes have been used in many circumstances to correct practices that were manifestly wrong.

None of these issues was at play in Qantas or many of the other areas where strike action has been abused by the union movement. 

Up at Dampier, 30 employees of Mermaid Marine were offered increases up to 35 per cent over three years (mainly to cover the huge cost of housing in the north-west) to take the annual pay rate to around $190,000; and they still went on strike. 

The reason for this is two-fold and revolves around the union movement.

Firstly, the new laws make it too easy to go on strike – and there are few consequences for the employee or the union if they do so. It is a one-sided affair.

Secondly, the reversal of the WorkChoices focus on the individual to the Fair Work mantra of the collective leaves little other recourse. In many cases, businesses would be more than happy to pay significant parts of their workforce more money and give them better conditions, mainly on the basis that by encouraging the best workers they’ll get more productive results.

But the Fair Work system is about everyone getting the same. Employers have no interest in negotiating deals where the best and the worst get the same arrangement no matter what their contribution to the business. In fact, such a system is dangerous, because it reduces the incentive of the better workers to be productive – what’s the point, the outcome is the same no matter how hard or smart you work?  

Because of this system, it’s hard for unions to promise any improvement in productivity – whereas individuals who strike agreements can.

If you can’t offer benefits, you have to threaten detriment. 

Furthermore, unions are really about protecting the lowest common denominator, so the best bargaining chip they have is that they can pull out the whole labour force, which is a much bigger threat than withdrawing the services of the least productive employees.

Union management

Another big issue to have arisen from the Qantas dispute, but also prevalent elsewhere, is how much unions, empowered by Labor, believe they can play a role in the strategic decisions of a business.

This is very dangerous territory. As we know from seeing bad decisions by management and boards, unmanageable vested interests tend to damage the ability of organisations to survive in the longer term.

When employees start dictating the strategy of the company based on their long-term needs, questions have to be asked. When I became a journalist, I was under no illusions about the career I’d chosen. It paid less than others I could have pursued, and the hours were often longer and unsociable; that was my choice.

But changes are taking place in our industry at a fast pace. The internet is swiftly creating competition, not just for traditional employers, but also for journalists. 

Digital publishing is cheap and easy, so salaried reporters are competing with freelance journalists, public relations providers and any business with active websites and email distribution lists.

As a journalist this could threaten my livelihood, or at least the value of the services I can provide. Certainly, in the case of newspapers, there is the real possibility that such work may cease within my career.

However I just don’t see the point of expending unnecessary energy fighting what is most likely inevitable. If I don’t like something, I can always go elsewhere, or start my own business. We all need to adapt and change; there are no jobs for life anymore, let alone those handed down from generation to the next.

In the case of Qantas, the business has a survival strategy that will involve shifting some (new) work offshore. The biggest complaint about industry in our country is that it is all foreign-owned and that Australian companies don’t make it on the international stage – especially in service sectors where brand and customer are most important.

No wonder that is the case if you look at Qantas.

The airline challenges the concept that Australian retail companies can’t prosper in the international marketplace. It is a successful Australian company that is profitable in one of the toughest industries on the planet. It is one of the world’s great brands.

And yet its employees – or some of them – are willing to jeopardise that because they are unwilling to change. They’d rather see the company stagnate and die than contemplate the fact their jobs might be different from they expected them to be.

It is quite unbelievable.

• mark.pownall@wabn.com.au

 

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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