Industrial relations had its Genesis during the period of the industrial revolution in the late seventeenth century. Large scale production facilities were spawned and simultaneously, the
process of collective bargaining and the corresponding development of labour relations also had
The intervening years saw major reforms to this relationship between capital and labour,
minimum wages, eight hour days, paid annual leave, sick leave, and more recently, paid
superannuation to name a few. More recently however, those changes have been at best,
marginally incremental over the years, a few less hours, a few more dollars but nothing of the ilk
of the major reforms of the past hundred years.
Fast forward to the present day and union membership has been in decline, one supposes due
in part to the limited scope of these current increments or when work patterns change,
employments is more transitory, more contract or part time rather than a previous job for life.
The relationship between individual employers and employees is more or less defined by the
individual mobility and negotiations of workers from one employer to the next rather than
participation in any form of collective bargaining with a common employer, the preservation of
self has risen to the forefront of labour relations.
Even so, this process has in itself created another set of circumstances as a consequence,
individual negotiations has produced the increasing disparity between the high and low ends of
the salary scale, the value that industry now places on certain sectors of the workforce and
various acts of labour. Fifty years ago, the range of incomes between management and the
average worker pay scale might have been in the range of ten to one, now that range has
escalated to one hundred to one or more.
The point to which we have progressed in society is unsustainable. We have an economy built
around rampant consumerism of unnecessary possessions and the acquisition of wealth that
permits the least able to fall through cracks that exist in that pursuit. At issue also, is the value
we place on certain types of labor, for instance, the salaries of competitive sportsmen and
women, the payments made to entertainment performers, neither of which produce tangible
goods other than the provision of an outlet to spend time consuming while the people working
behind the scenes to create those environments earn a fraction in return.
This division spills over into the political world and in some respects, is symptomatic of a
regression back to the state of affairs that existed prior the industrial revolution, where privilege
is defined by completely different standards to the general population.
Jose Mujica, the former President of Uruguay perhaps best epitomises the type of leadership
we should have in a fair and equitable wold. In a recent interview, he explained how his country
invested in an expensive helicopter that would reside in the countryside to conduct rescues as
opposed to purchasing a Presidential jet.
His argument is that as a government, they should spend money on things that are important to
everyone. And he is right. His voice is at odds with the widespread voice of the marketing
people promoting an individual pursuit of success rather than a collective one.
Unionism is often its own worst enemy in determining equitable adjustments of these disparities.
In order to reach its objectives, it assumes an animus that frequently perpetuates a militant
division that has become a gulf between those that make the payment and those that receive it
rather than seeking to address the imbalance as a partnership between labour and capital.
Even in the last few weeks in Australian industrial relations, the courts have ruled that the
collective bargaining on behalf of shop assistants has cost them millions of dollars in unpaid
wages over the years and as has been reported, many are since finding that they can do better
with individual bargaining.
While the arguments continue around the fringes of the relationship, there is a major fault line
that is expanding. For industry to prosper, it has to be an equitable partnership between the
providers of capital and the providers of labor.
The issue however is that under our present industrial system, we are controlled by opposing
positions that fear to give ground. Employers look to maximizing their return on investments and
do so by controlling and suppressing the cost of labor while workers look at increasing their
take home and staff benefits, neither looking or rarely look at at the relationship from the
perspective to the other party.
Karl Marx in his treatise, Das Kapital postulated this relationship in the eighteenth century which
strikes at the very heart of capitalism. Little has changed in the intervening one hundred and fifty
Labor is ruled by necessity, when wages are simply enough to exist week to week rather than
survive for an extended a period of inaction.
Capital on the other hand is ruled by some level of greed, of the exploitation of labour and right
to the excess value of that labour when directed at a particular objective within the industrial
Marx went on to deliberate on the formation of society where it had replaced the societal and
religious value of money with the commodity fetishism, the belief that objects had inherent
economic value. The need to be seen in the latest fashion, to drive the latest model car, to
present to the world a false sense of economic security, the ease of escalating indebtedness,
the aspiration to emulate the rich and powerful in some small way rather than adjusting our life
to live within our means.
As a means of increasing the profitability of industry, in keeping with the industrial revolution
there has been an increase in the mechanisation of tasks and the elimination of labor. This
however also has its own structural faults. If the existing labour is reduced to poverty through
lack of engagement, the scale of consumption will ultimately decrease due to a lack of available
financial capacity of the consuming public.
In many respects, as a society, we need to look at the existing division between capital and
labor and at the interconnectivity that exists between them both.
Our current global trade patterns also drive us towards this inevitable decline in general
population living standards. We quite happily ignore the fact that the shirt we wear may have
been manufactured in some third world sweatshop by people paid a small fraction of the wages
paid to manufacture it locally and with none of the conditions of employment we enjoy, simply to
participate in this commodity fetishism.
To start to address the imbalance, we should be insistent both from a public and private
perspective that goods manufactured overseas to which we are in competition for profit and
employment, should have the same level of industrial relations and pay scales to that which is
configured for Australian industries. We do have some low levels of non profit advocacy for
improving working conditions overseas through programs that invoke shame however, this does
require a much stronger advocacy, even on an industrial scale. The rest of the world needs, and
in particular the third world needs to have its own industrial revolution, its own Genesis of
industrial relations that the west underwent two hundred years ago.
Transport unions should refuse to move goods that cannot demonstrate equitable pay scale and
employment conditions required of Australia employers have been used in their manufacture.
Retail staff should similarly refuse to support goods that cannot show the same detail. In our
own internal industrial relations atmosphere, this would be a straightforward issue. If for
instance a builder paid less than the award rate with non-unionized labour, the supporting
unions would initiate action that saw deliveries and services blocked to the building site until the
matter was addressed. While ever we fail to support such a move, we are being instrumental in
our own demise.
The outcome of such an action will have some profound outcomes, and many hardships will
have to be endured, such as our forefathers endured at the onset of the industrial revolution but
that is the nature of global trade. Local industry today is in effect, competing with pre-industrial
revolution production that sees local manufacture prosper then over time, wither as the capacity
to compete with the cheaper production.
While both labour and capital are dependent upon each other for industry to exist, there needs
to be a redress in the nature of that relationship given that the aspects of erosion caused by
global trading are being addressed.
In a recent Michael Moore movie, Where to Invade Next , he looks at some instances of
difference between the US and Europe and at one point, worker conditions in Italy. The
management of Lardini, a clothing manufacturer saw it as a right of the workers and their
responsibility to ensure that their workers get equitable vacation time for instance, some thirteen
weeks a year while which in turn translates into less sick time being taken.
In a further interview with the CEO of Ducati motorcycles, he saw no clash between the
wellbeing of the workers and the profitability of the company. He explained that by paying a
good wage with good benefits had little or no effect on profits.
Industry is, or at least should be a common partnership between labour and capital. Neither can
fully exist equitable without the other. What is at issue is who profits from the improved value of
the labour and should that value be distributed more equitably. While a good idea, it is going to
take a major shift in thinking in defining the relative or comparative value of an act of labour in
the overall value in the end price of the commodity or service. For instance, it is questionable
that the decisions of a manager of a large public service such as the postal service for instance
have a value that is one hundred times more valuable than that of the average worker within
that organisation. Without each other, the system does not exist.
Governments are on the other hand however constrained with global trade as much as
supporting local industry. They have over time, sought to increase national profitability by
increasing the scale of global trade, sacrificing specific sectors of industries in order to provide
support to others, opening up trade relationships that overlook the gains made in industrial
relations. As a consequence, over the years our manufacturing capacity has diminished. We no
longer have a local automobile manufacturing industry among others, opting to increase imports
from those countries we supply the raw materials to rather than maintain local production. In
some respects this relies on economies of scale however, it can and has been done for the past
hundred years yet we opt to enable cheaper manufactured units to be supplied that support a
balance of trade.
It does come back to consumer fetishism, the need to own an array of products that serve no
useful or functional purpose and when they do, to have the latest version, the bling, and how we
Unionism, aside from its role in local advocacy for better wages and conditions, needs to take a
stronger role in defining a global industrial reformation, ensuring that local industry operates on
a level playing field with global manufacture. At the same time, it ought to be able to define the
relative value of labour within an enterprise or enterprise sector while taking into account the
appropriate return on investment for the benefit of the provision of capital. It is when these two
aspects are conflated or alternatively, omitted from the discussion that the disparity continues to
arise. Industry must be seen as a partnership to the benefit of both contributors, labour and
Unionism, providing support to industry to address its decline through a dysfunctional global
trade will in many ways, provide a pathway to establishing a better working relationship between
both sides, the creation of an employment and industrial partnership where all can benefit