Unions: self-made umpires

How important are trade unions and the industrial relations system at workplace level? Will IR reforms make a difference to industrial relations in the workplace?

There is a good example of the lack of influence trade unions and the existing industrial relations system have on companies. At a recent lunch in Sydney, Graeme Wise, managing director of the Body Shop, was talking about the success of the company in Australia and said that it had little to do with trade unions, the Australian Industrial Relations Commission or the IR system in general.

The company does not deal directly with unions and rewards and manages its employees as it sees fit. Thus there is no union involvement.

There can be obstacles on occasion. As Wise pointed out, the company dropped the ball in a case of a redundancy, which he admits was badly managed. As he says, "It's about good management, not trade unions ... People don't need trade unions if they are managed well and employees are respected."

This was reinforced by findings in my book Bargain Out: Negotiating Without Unions in Australia (co-authored by John Campling), which suggested few non-unionised and lightly unionised workplaces thought unions or legislative reforms were important.

Is there anything wrong with companies opting out of the IR system? The argument should not be seen as an argument against unions; quite the contrary. It is about the evolution of the union structures, processes and behaviour, not unionism.

There is a recognition that as a society changes, so must its institutions in order to reflect society as it operates now. Trade unions must embrace workers and feel confident in representing a diversity of groups, including small business owners and the self-employed.

The figures tell the story: there are more people self-employed (1.9 million) than there are unionists (1.8 million). It is estimated that on average 14 per cent of people in Labor electorates are self-employed or involved in small business. This rises to 20 per cent in Coalition electorates. The real electoral support for the Howard Government is in the working-class suburbs of the nation, not the elite suburbs of Toorak or Vaucluse.

For trade unions this may involve a degree of soul-searching and the need to confront hard-core values of workers and employers, and perhaps recognise that conflict is not always inherent in the relationship. Things have changed, our values have changed, and so should our IR institutions.

ACTU secretary Greg Combet suggested in a recent interview that he did not expect a future Labor government to roll back the IR changes. Instead, he said, "I've already started to think about how you roll forward".

Given the precarious state of unions, Combet knows that time is ticking away. The trade union movement is just hoping that in rolling forward, they don't get crushed.