Industrial action still a real risk

The Ford dispute has shown that a change of government or economic fortunes has the potential to re-ignite industrial action to levels before WorkChoices.

By Peter Vitale of VECCI

Industrial action may be less frequent than it used to be, but it can still generate plenty of punch in terms of litigation, lost time and lost profit.

Take the case of the Ford dispute, which triggered the closure of the manufacturing plants and the stand down of nearly 2000 workers. It is not yet settled and there is no guarantee that there won’t be further stand downs.

The most recent ABS figures show a clear decline in industrial action. Pretty much all observers agree that the federal Government’s Work Choices legislation has contributed to the decline. But this dispute raises questions about how much damage can still be done to an industry when a dispute becomes intractable and long-running.

It’s a familiar scenario in the Australian automotive industry. Ford was forced to implement the stand downs after employees at a major components supplier, Venture Industries, voted to go on strike over proposed redundancies. This was the third time Venture employees had sought an order through their union, the AMWU, from the AIRC in 2007 for orders to conduct a secret ballot to approve industrial action.

Following the stoppages at both Venture and Ford, Ford made what is believed to be the first application under a new provision of the Workplace Relations Act. The new section 433 of the Act enables third parties being harmed by the industrial action to seek orders to suspend the bargaining period between the parties in dispute.

This provides wider grounds to suspend a bargaining period than under the pre-Work Choices legislation, when damage to a significant part of the Australian economy had to be shown.

After hearings and discussions between the parties last week, the AIRC agreed to suspend the bargaining period until today (Tuesday 4 September). The effect of this order was to make the strike action by Venture workers unprotected and illegal.

Ford followed up with an application to prevent the unprotected action, but Venture employees went back to work, subject to finalising a deal with their employer about “security” for redundancy entitlements.

So, after months of dispute, how far have the parties progressed? If Venture and the union can’t finalise their agreement by today, then more industrial action and more interruption of production in the broader vehicle industry looms large. That will undoubtedly be followed by more litigation, more discussions and continuing uncertainty.

Although WorkChoices has contributed to reducing the amount of industrial action, there had been significant reductions in the level of action in preceding years. There may be a reversal of the conventional wisdom that union demands and industrial action follow on from skill shortages and a tight labour market.

Two of the biggest industrial disputes so far this year, at Venture and at fellow components manufacturers Tristar, relate to redundancies in an industry that is notoriously struggling to be profitable. What remains to be seen is whether a change of government or a change of economic fortune will result in re-ignition of industrial discontent to pre-WorkChoices levels or beyond.