Industrial relations had its Genesis during the period of the industrial revolution during 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 its rise.
The intervening years saw major reforms to this relationship between capital and labour, minimum wages, eight hour days, paid annual leave, sick leave, and 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, employment is more transitory, the gig economy as they call it, 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 to 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 world. 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 years 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 maximise 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 looking at the relationship from the perspective of 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 years.
Labor is ruled by necessity, when wages are simply enough to exist week to week rather than survive for an extended 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 framework.
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 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, with 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 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 equally 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. 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 get there.
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 capital.
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.