Friday 1 January 2021

Unions in Australia: Reality and Fiction.

After some fifty years of relentless “neoliberal” onslaught, unions still make a difference for Australian workers.

You don’t need to take my word for that. According to the latest ABS release on trade union membership, “median weekly earnings for employees who were trade union members in their main job were $1,450 per week”: $350 (or 32%) more than their non-union counterparts.

With only one exception (salespeople), that holds for staff ranging from managerial and white collar down to blue collar workers. Indeed, for community and personal service workers the difference is a whopping 60%.

Moreover, although the relevant data show large variability at the lower end of the median weekly earnings (MWE) scale, the higher the percentage of trade union membership (TUM) in an industry, the higher tend to be workers’ earnings in that industry:

(source here and here)

Workers in education and training, public administration and safety, and health care and social assistance (activities largely undertaken by the public sector) are the most unionised in Australia: 31%, 28%, and 24% of their workforces, respectively, belong to a union.

And this happens as trade union membership has collapsed since the mid-seventies, regardless of sex:

From being disproportionately male, today union membership is slightly female-dominated. It also tends to be higher among workers with at least post-secondary education:

Moreover, that advantage union members enjoy over non-union workers is all but a historical constant.


I trust the similarity between Australia and the home of the free and land of the brave will be evident to American readers: “Among full-time wage and salary workers, union members had median usual weekly earnings of $1,095 in 2019, while those who were not union members had median weekly earnings of $892”.


Before jumping to conclusions, however, it’s worth having a look at how employment conditions in general are set in Australia. Two terms are important: “awards” and “enterprise agreements”.

The Constitution of Australia gives the Commonwealth conciliation and arbitration powers to make laws for the prevention and settlement of industrial disputes, much in the spirit of reformism. On this, it follows the previous state constitutions.

Currently the Fair Work Commission is charged with the prevention and settlement bit (think of it as a tribunal), and as part of its responsibilities it maintains and updates a system of federal awards. Although states and territories often accept those awards, some state awards still exist. Bottom line: awards don’t need to be federal.

Awards establish the basic employment conditions, including wages, per industry. They are meant to provide a minimum “safety net”. Within the American context, something not entirely different albeit much more limited would be a federally mandated minimum wage: employers cannot lawfully pay below that amount, but wages exceeding it are not a priori excluded.

Great, yes? In practice, however, things aren’t as pretty and wages below award (aka “wage theft”) are common among the young and visa workers, all of whom are stubbornly reluctant to join unions, in my experience. And the Fair Work Ombudsman (not to be confused with the Commission), the body acting as mediator, does not proactively enforce award conditions. So, those workers are on their own, largely by their own choice.

But let’s leave that aside. Enter enterprise agreements. Businesses and their staff within each industry are free to negotiate employment conditions better suiting their particular circumstances. That implies that concessions can be made, but the result of the negotiation process must satisfy a test (the so-called BOOT, which the Morrison Government wants to scrap): employees must be better off overall relative to award conditions.

Normally trade unions represent the employees in enterprise bargaining processes and – in spite of legal limitations imposed on them – as the data show, they seem to be doing a fairly good job at that – although exceptions to that rule are known (trade unions have acted in those cases, even as the media chose to ignore that).


It’s important to keep that in mind because among better-off Leftists, generally more interested in highfalutin theory than in prosaic practice, the fact union members are better paid than non-union workers has always been a concern. They, that is, understand why their own ­earnings are higher, what troubles them is that some other less gifted workers get better pay than other equally less gifted workers.

The explanation prevailing among those Leftists is that this difference in earnings hinges on the super-exploitation of non-union workers, domestically or abroad, which they believe was agreed upon between capitalists and union workers, generally on the grounds of capitalists manipulating union workers’ racism/xenophobia. I’ve seen American New Leftists describe this as a “sweetheart deal”

I’ll remind, then, those Leftists, whether Americans or Australians, another detail often overlooked: as representatives of the employees in an enterprise bargaining agreement, trade unions by law represent members and non-members alike. Non-members get from EBAs exactly what members get, no more, no less. But it’s only dues-paying, card-carrying members (full disclosure: like yours truly) who financially contribute to cover the union’s expenses. To be blunt: we subsidise our non-union workmates, regardless of race, ethnicity, place of birth, age, gender, sexual preference or religion.

I am loath to call my fellow non-union workers “free-loaders”, as a well-known Australian labour law expert and litigant has, but it does seem to fit.

That goes a long way into explaining why union membership is falling, even as unions do their most basic job, yes?


I am not really knowledgeable about the American case, but I believe over there that is called “right to work”.

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