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1301.0 - Year Book Australia, 2007  
Previous ISSUE Released at 11:30 AM (CANBERRA TIME) 24/01/2007   
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Contents >> Labour >> Industrial relations

INDUSTRIAL RELATIONS

Industrial relations can be regarded as the relationships and interactions in the labour market between employers and employees (and their representatives), and the intervention in these relations by governments, government agencies and tribunals (e.g. the Australian Fair Pay Commission and the Australian Industrial Relations Commission).

Historically, governments have regulated the Australian labour market to varying degrees. Changes to the structure or processes underpinning the industrial relations environment have generally followed changes in governments, and periods of social or economic change. For most of the last century, employee-employer relationships were shaped by highly centralised Commonwealth and state tribunal-based systems of conciliation and arbitration. However, since the late-1980s, the industrial relations environment in Australia has undergone significant change and is now characterised by more decentralised arrangements.

The field of industrial relations is complex and diverse and, for statistical purposes, is not easily measured. The ABS collects information on a number of topics to provide an insight into the state of the industrial relations environment, including the methods used for setting pay (i.e. awards, collective agreements and individual arrangements), industrial disputes, and trade union membership.

HOW PAY IS SET

Information on the methods of setting the main part of employees' pay is collected in the EEH survey. Three different methods of setting pay are identified - awards, collective agreements, and individual arrangements.

Awards are legally enforceable determinations made by federal or state industrial tribunals that set the terms of employment (pay and conditions). Awards usually cover a particular industry or occupation. Employees whose pay is set by 'award only' are those who have their pay set by an award, and who are not paid more than the award rate of pay.

Collective agreements, which include enterprise and workplace agreements, are agreements between an employer (or group of employers) and a group of employees (or one or more unions or employee associations representing employees). Collective agreements set the terms of employment, and are usually registered with an industrial tribunal or authority.

Individual arrangements are arrangements between an employer and an individual employee on the terms of employment for the employee. Employees whose pay is set by an individual arrangement include those whose pay is set by an individual contract, registered individual agreement (e.g. an Australian Workplace Agreement), or common law contract, as well as employees receiving over-award payments by individual agreement, and working proprietors of incorporated businesses.

The proportion of employees who had their pay set by award only, decreased from 23% in May 2000 to 20% in May 2004 (graph 6.52). Over the same period the proportion of employees who had their pay set by a collective agreement increased from 37% to 41%.

6.52 METHODS OF SETTING PAY - May



In May 2004, 38% of all private sector employees had their pay set through an unregistered individual arrangement, compared with only 4% of public sector employees (table 6.53). Most public sector employees had their pay set by a registered collective agreement (92%). Men were more likely than women to have their pay set by an unregistered individual arrangement (35% compared with 27%), and less likely than women to have their pay set by award only (16% compared with 24%). Part of the difference between male and female employees' pay setting methods can be attributed to the differing proportions of men and women in the various occupation and industry groups.


6.53 METHODS OF SETTING PAY - May 2004

Sector
Collective agreement
Individual arrangement


Award
only
Registered
Unregistered
Registered
Unregistered(a)
Working
proprietor of
incorporated
business(a)
%
%
%
%
%
%

MALES

Private
19.0
23.3
3.6
3.0
41.7
9.5
Public
*0.7
90.7
*0.6
3.0
5.0
-
All sectors
15.7
35.2
3.0
3.0
35.2
7.8

FEMALES

Private
31.0
25.2
2.8
2.2
34.9
3.9
Public
*3.5
92.6
*0.2
0.9
2.8
-
All sectors
24.4
41.4
2.2
1.9
27.2
2.9

PERSONS

Private
24.7
24.2
3.2
2.6
38.5
6.9
Public
*2.3
91.8
0.4
1.8
3.7
-
All sectors
20.0
38.3
2.6
2.4
31.2
5.4

(a) Prior to 2004, working proprietors of incorporated businesses were classified to unregistered individual arrangements.
Source: Employee Earnings and Hours, Australia, May 2004 (6306.0).


The occupation groups which had the highest proportion of employees who had their pay set by a registered or unregistered individual arrangement were Advanced clerical and service workers, and Managers and administrators (52% and 47% respectively) (table 6.54). A further 27% of Managers and administrators were working proprietors of their own incorporated business. Awards were far more prevalent in the lower skilled occupations, with 40% of Elementary clerical, sales and service workers and 38% of Labourers and related workers having their pay set by award only. In contrast, only 1% of Managers and administrators, 7% of Professionals and 8% of Associate professionals had their pay set by award only. Collective agreements were most prevalent for Professionals (56%) and Intermediate production and transport workers (50%).


6.54 METHODS OF SETTING PAY, By occupation(a) - May 2004

Individual arrangement

Award
only
Collective
agreement(b)
Registered or
unregistered(c)
Working
proprietor of
incorporated
business(c)
%
%
%
%

Managers and administrators
0.8
25.3
47.3
26.7
Professionals
6.7
55.8
32.8
4.7
Associate professionals
8.3
40.0
42.6
9.1
Tradespersons and related workers
22.5
34.6
35.2
7.7
Advanced clerical and service workers
8.2
30.2
51.8
9.8
Intermediate clerical, sales and service workers
25.8
38.3
34.6
1.2
Intermediate production and transport workers
17.3
50.0
29.9
2.9
Elementary clerical, sales and service workers
39.9
37.1
21.8
*1.2
Labourers and related workers
37.9
36.8
24.5
*0.8
All occupations
20.0
40.9
33.7
5.4

(a) Classified according to the Australian Standard Classification of Occupations (ASCO), Second Edition, 1997.
(b) Includes registered and unregistered agreements.
(c) Prior to 2004, working proprietors of incorporated businesses were classified to unregistered individual arrangements.
Source: Employee Earnings and Hours, Australia, May 2004 (6306.0).


The Accommodation, cafes and restaurants, and Retail trade industries had the highest proportion of employees who had their pay set by award only (60% and 31% respectively) (table 6.55). Collective agreements were more prevalent in Government administration and defence (89%), Education (84%) and Electricity, gas and water supply (80%). The industries with the highest proportion of employees who had their pay set through a registered or unregistered individual arrangement were Wholesale trade (62%), Mining (58%) and Property and business services (57%).


6.55 METHODS OF SETTING PAY, By industry(a) - May 2004

Individual arrangement

Award
only
Collective
agreement(b)
Registered or
unregistered(c)
Working
proprietor of
incorporated
business(c)
%
%
%
%

Mining
*1.9
38.8
57.6
*1.7
Manufacturing
14.9
35.8
44.5
4.8
Electricity, gas and water supply
*1.7
79.9
17.7
*0.7
Construction
15.2
24.1
40.8
20.0
Wholesale trade
14.9
16.0
61.8
7.3
Retail trade
31.3
33.4
30.3
5.0
Accommodation, cafes and restaurants
60.1
11.7
25.9
2.4
Transport and storage
14.4
41.9
36.2
7.5
Communication services
*2.1
62.6
32.8
*2.5
Finance and insurance
4.5
43.7
46.9
4.9
Property and business services
19.7
12.8
56.8
10.8
Government administration and defence
*0.8
89.3
9.9
. .
Education
8.9
83.5
7.2
*0.4
Health and community services
26.6
54.8
15.9
2.7
Cultural and recreational services
17.7
38.7
40.4
*3.2
Personal and other services
23.5
45.7
27.8
*2.9
All industries
20.0
40.9
33.7
5.4

(a) Classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition.
(b) Includes registered and unregistered agreements.
(c) Prior to 2004, working proprietors of incorporated businesses were classified to unregistered individual arrangements.
Source: Employee Earnings and Hours, Australia, May 2004 (6306.0).


INDUSTRIAL DISPUTES

In ABS statistics, an industrial dispute is a disagreement over an issue or group of issues between an employer and its employees, which results in employees ceasing work. Industrial disputes comprise: strikes, which are a withdrawal from work by a group of employees; and lockouts, which are a refusal by an employer or group of employers to permit some or all of their employees to work.

This section presents statistics on industrial disputes involving work stoppages of ten or more working days lost. Working days lost refers to working days lost by employees directly and indirectly involved in the dispute. Directly involved employees are those who actually participated in the dispute. Indirectly involved employees are those who were stood down at the location where the stoppage occurred, but who were not themselves parties to the dispute.

The number of working days lost per year, and the number of employees involved, have fluctuated from year to year, but have decreased significantly over the last two decades (graph 6.56).


6.56 INDUSTRIAL DISPUTES


There were 228,300 working days lost due to industrial disputes in 2005, a decrease of 40% from 2004 (table 6.57). There were less disputes in 2005 than in 2004 (472 compared with 692) and the average number of working days lost per dispute decreased (from 549 to 484). In contrast, the number of employees involved in industrial disputes rose by 24%, from 194,000 in 2004 to 241,000 in 2005.


6.57 INDUSTRIAL DISPUTES

Disputes
Employees
involved
Working
days lost
Working days
lost per dispute
no.
’000
’000
no.

2001
675
225.7
393.1
582
2002
767
159.7
259.0
338
2003
643
275.6
439.4
683
2004
692
194.0
379.8
549
2005
472
241.0
228.3
484

Source: ABS data available on request, Industrial Disputes collection.


The number of working days lost per thousand employees decreased from 46 in 2004 to 26 in 2005 (table 6.58). The Coal mining industry, which had the highest number in each year from 2001 to 2005, recorded the highest increase (41%) between 2004 and 2005 (from 295 to 500). The Construction industry had the second highest number of working days lost per thousand employees in 2005 (154), followed by Metal products, machinery and equipment manufacturing (104). The industries which recorded the largest decreases between 2004 and 2005 were Other mining (down from 118 to 27), Education, Health and community services (down from 82 to 29) and Construction (down from 224 to 154).


6.58 WORKING DAYS LOST PER THOUSAND EMPLOYEES, By selected industries(a)

2001
2002
2003
2004
2005
no.
no.
no.
no.
no.

Mining
Coal
1,154.3
361.8
375.1
294.5
500.1
Other
32.9
19.6
330.1
117.5
27.2
Manufacturing
Metal products; Machinery and equipment
269.2
92.2
214.9
71.7
103.7
Other
149.4
82.7
59.6
34.1
27.7
Construction
280.2
224.6
248.6
223.7
153.8
Transport and storage; Communication services
39.4
54.2
53.7
37.9
20.0
Education; Health and community services
7.0
3.1
76.1
81.8
28.9
Other industries(a)
7.1
8.7
4.9
10.0
2.2
All industries
50.4
32.5
53.7
45.5
26.4

(a) Classified according to the Australian and New Zealand Standard Industrial Classification (ANZSIC), 1993 edition.
(b) Includes: Agriculture, forestry and fishing; Electricity, gas and water supply; Wholesale trade; Retail trade; Accommodation, cafes and restaurants; Finance and insurance; Property and business services; Government administration and defence; Cultural and recreational services; and Personal and other services.
Source: ABS data available on request, Industrial Disputes collection.


Trade union membership

A trade union is defined as an organisation, consisting predominantly of employees, whose principal activities include the negotiation of rates of pay and conditions of employment for its members. In August 2005 there were 1.9 million employees who were trade union members in their main job, a 4% increase on the number recorded in August 2004. While the number of employees who were trade union members increased, the proportion of employees who were trade union members decreased slightly between August 2004 (22.7%) and August 2005 (22.4%) (table 6.59). The public sector had a higher rate of unionisation in 2005, with 47% of employees having trade union membership, compared with 17% in the private sector. A slightly higher proportion of men than women were trade union members (24% compared with 21%).


6.59 TRADE UNION MEMBERSHIP - August 2005

Males
Females
Persons
Sector
%
%
%

Public
50.4
44.8
47.2
Private
18.9
14.1
16.8
All sectors
23.5
21.1
22.4

Source: Employee Earnings, Benefits and Trade Union Membership, Australia, August 2005 (6310.0).


The rate of trade union membership in Australia peaked at 61% in 1962 (graph 6.60), before declining rapidly between 1962 and 1970. This was followed by increasing membership during the 1970s. However, since then the proportion of employees who were trade union members has steadily declined.

6.60 TRADE UNION MEMBERSHIP, Proportion of employees 6.60 TRADE UNION MEMBERSHIP, Proportion of employees


Some of the factors contributing to the decline in trade union membership include the changing workplace relations environment and the changing industry composition of the workforce. These changes include declines in employment levels in traditionally highly unionised industries and the emergence of industries that are not highly unionised. Another factor in the decline in trade union membership is the increase in part-time and casual employment. These types of employment have historically been less unionised than full-time employment.

The level of trade union membership varies considerably across industries, with the Electricity, gas and water supply and Education (both 43%), Government administration and defence (40%), and Transport and storage (34%) industries being the most unionised in 2005 (graph 6.61). The least unionised industries were Agriculture, forestry and fishing (6%), Property and business services and Accommodation, cafes and restaurants (both 7%) and Wholesale trade (9%).

Between 2000 and 2005 most industries experienced a drop in their rate of unionisation. The largest declines occurred in the more unionised industries, with the proportion of employees who were trade union members falling in the Communication services industry (from 38% to 26%), Electricity, gas and water supply (from 53% to 43%) and Mining (from 32% to 25%). The Government administration and defence and Agriculture, forestry and fishing industries were the only industries to experience an increase in the proportion of trade union members.

6.61 EMPLOYEES WHO WERE TRADE UNION MEMBERS, By industry(a) 6.61 EMPLOYEES WHO WERE TRADE UNION MEMBERS, By industry(a)

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