Appendix 3 - Answers to questions on notice
INQUIRY INTO THE
WORKPLACE RELATIONS AMENDMENT (PROHIBITION OF COMPULSORY UNION FEES) BILL 2001
of Employment, Workplace Relations and Small Business
Senator Collins asked at Hansard 31 August 2001, p 19
Whether a statement of the International Labour Organisation
(ILO) quoted in the Australian Council of Trade Union’s submission is
consistent with the Department’s response regarding the implications of the
Bill for Australia’s obligations under ILO conventions on Freedom of
Association. If the two statements are inconsistent which has the greater
There is no inconsistency between the extract from the ILO’s
tripartite Committee on Freedom of Association quoted by the ACTU at paragraph
23 of its submission and the approach of the ILO outlined by the Department at
the Senate Committee’s hearing.
The extract from the ILO’s Digest of decisions quoted in the
ACTU’s submission is from a decision of the ILO’s tripartite Committee on
Freedom of Association (see 289th Report, Case No. 1594, paragraph 24). This
decision concerned a complaint against the Government of Cote d’Ivoire by the
World Confederation of Labour over the arrest, detention, withholding of
salary, and dismissal of members of the Federation of Free Trade Unions of
Cote d’Ivoire (‘Dignite’), an association of trade unions established in
competition with the country’s only other association, the General Union of
Workers of Cote d’Ivoire (UGTCI). In full, paragraph 24 of that decision
regards recovery of the union dues which, according to the complainants,
several employers were deducting at the source and paying to the UGTCI, despite
letters from workers informing management and heads of personnel that they had
left that trade union, the Committee notes that no new reply [from the Government] has been supplied. The
Committee cannot but recall that, in keeping with the principles of freedom of
association, it should be possible for collective agreements to provide for a
system for the collection of union dues, without the interference of
authorities. It requests the Government to supply information on the measures
taken to ensure that union dues are repaid to the trade union organizations
actually chosen by workers.
not inconsistent with the position put by the Department that legislative
schemes that permit or prohibit union security arrangements (such as universal
service fees) are both compatible with ILO standards.
This is illustrated by the extracts from the Committee on
Freedom of Association’s 1996 Digest of Decisions and the Committee of Experts’
General Survey on Freedom of Association and Collective Bargaining 1994, which
were supplied to the Senate Committee.
Senator Collins and Senator Carr asked at Hansard 31
August 2001, p 20:
Regarding written complaints from employees about service
fees, can the Department give us some indication of the incidence and nature of
these complaints, including the nature of the industry and the size of the
firms in which these employees work.
The Department is aware of six written complaints regarding
service fees. Two of the complainants specifically identified themselves as
public sector employees. One complainant referred to past employment in the
manufacturing industry, one referred to past membership of a union management
committee and the remaining two complainants did not specify their occupation.
One of the public sector complainants provided details of a
recent certified agreement negotiated by a union which caused significant
salary downgrading for certain employees within the complainant’s workplace,
and expressed concern as to the requirement to pay for such union services (the
salary downgrade was alleged to be $5,000pa in some cases). Another
complainant who had been on a union management committee felt that charging
service fees above membership rates was an attempt to make people join the
Several of these written complaints requested the Government
to change the laws to prevent payment for unsolicited services.
The Department is also aware of a number of verbal
representations to the Office of the Employment Advocate.
Senator Collins asked the Department, at Hansard 31
August 2001 page 21, to address the points raised in the submission of
Professor Keith Hancock.
In his submission Professor
Hancock argues that balancing collective bargaining and freedom of association
issues is a difficult policy area, and that all available alternatives raise
problematic issues. He canvasses several approaches.
However, the Government’s
chosen response to this issue reflects its view about the importance of
individuals rights to freedom of association. In his second reading speech
introducing the Workplace Relations and Other Legislation Amendment Bill
1996, the then Minister for Industrial Relations, the Hon. Peter Reith MP,
identified the principle of freedom of association as being ‘...[a]mong the
fundamental principles underpinning the government’s industrial relations
He also highlighted the protection for individual freedom of association
and freedom of choice provided under the WR Act when he stated that the WR Act
was intended to deliver ‘...genuine freedom of association founded on effective
protection against coercion and discrimination based on an individual’s
membership or non-membership of a union.’
The Government considers
that registered organisations should seek to attract membership based on the
competitiveness and value of the services they offer to attract members.
Senator Collins asked the Department, at Hansard EWRSBE
page 21, to address the points raised in the submission of Mr Graeme Orr.
The points raised by Mr Orr
and the response to each point are set out below:
Mr Orr argues
that the Bill infringes freedom of collective contract.
Government’s policy on compulsory union fees is founded on a strong policy
emphasis on the individual right to freedom of association. This has been
The WR Act
already protects certain individual freedoms ahead of freedom of collective
contract. For example, a collective contract cannot impinge upon the
protection afforded individuals against discrimination. The Bill further
protects individual freedom.
Points 2 and 3
Mr Orr argues that ‘agency bargaining fees’ represent a way in which
the ‘free-rider’ problem can be addressed and that agency fees should be a
permissible matter for enterprise level bargaining.
The Government’s view is that every individual has a right to choose
whether she wishes to join a union, and whether she wishes to associate with a
union in some other way, for example by consenting to pay some form of fee for
bargaining services. The Government believes that it is an infringement of the
individual right to freedom of association for compulsory union fee
arrangements to be imposed upon individuals by majority approval of a certified
The Bill is intended to ensure that individuals can only be required
to pay a fee to a union where they have given their individual consent to do
Mr Orr argues that requiring the payment of a ‘fair share fee’
without mandating membership of a union does not infringe associational
freedom. As discussed above, it is the Government’s view that such
arrangements do infringe upon the right of individuals to freedom of
association. In addition, the ‘fairness’ of imposing such fees on non union
members, particularly in situations (as discussed in the Department’s
submission at paragraph 44) where unions actively attempt to prevent non
members from participating in certified agreement negotiations.
Mr Orr suggests that the ETU ‘bargaining agents fee’ clauses which
impose upon non union members a fee greater than normal union dues are intended
to create a disincentive to non-membership. The Government is in accord with
this view, as was Vice President McIntyre when he found that the clauses were
intended ‘...to persuade new employees to join, or to coerce new employees into
joining the ETU.’
Points 6 and 7
Following from his argument that ‘agency bargaining fees’ imposed
through certified agreements should be permitted, Mr Orr argues that regulation
of bargaining agents fees (for example in relation to the amount of the fee) is
required. As stated above, the Government’s view is that compulsory union fees
imposed through certified agreements represent an infringement of the
individual right to freedom of association. The Bill would permit bargaining fee
arrangements only where the union and individual employee or employees
concerned reach agreement before any services are delivered. In such
circumstances, where there is agreement by both parties, no further regulation
of such arrangements is necessary.
Senator Carr asked at Hansard 31 August 2001, p 21:
How many occasions have there been of political intervention
to prevent or effectively pre-empt an appeal from a legal tribunal in this
The Government does not consider that the Bill constitutes
political intervention to prevent or pre-empt an appeal. Legislation to give
effect to the principle of freedom of association is required irrespective of
the outcome of current Commission proceedings.
The Government considers that demands by unions for
bargaining agents fee are contrary to the principles of freedom of association,
particularly the right of individuals to choose whether or not to join an
Government policy is that the only means by which bargaining
fees can be charged consistently with freedom of association principles is for
the fee to be agreed to in writing by an individual worker and in advance of
bargaining services being provided to that individual.
Australian Industry Group
Senator Collins asked at Hansard 31 August 2001, p 6:
In the case of a new
employee, how do you deal with the situation where obviously the bargaining has
already occurred before you are dealing with their employment and their
potential union membership, or even their potential payment of a fee? That is
Australian Industry Group (Ai Group) does not believe that
the terms of the bill would prevent a new employee from making a voluntary
financial contribution to a trade union.
The effect of the bill would be to prohibit an industrial
association (eg. a union) from demanding or receiving a fee or levy for the
provision of bargaining services (s.298QA(1)).
“Bargaining services” are defined in proposed sub-section
298B(1) as services provided “in relation to the negotiation, making,
certification, extension, variation or termination of an agreement under Part
In our view, a new employee engaged during the term of a
certified agreement would remain free to make a voluntary contribution to a
trade union. The exclusion in sub-section 298QA(1) would not apply because
“bargaining services” have not been provided. Such services, by definition,
only apply to the processes of negotiating, making or certifying an agreement
or when an agreement is to be varied or terminated. Such processes are not
occurring in circumstances where a new employee is engaged during the life of
an existing certified agreement.
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