LUCIO TRENTINI: Extension of bargaining council agreements is key to labour market certainty

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The argument that collective agreements adversely affect non-party employers by requiring them to pay higher wages than they would otherwise have done may well be correct. The point is that section 32 of the Labour Relations Act expressly empowers — indeed, requires — bargaining councils and the employment & labour minister to follow a specific procedure for extending bargaining council agreements. This procedure was agreed upon in 1995 by the parties to the, including the representatives of business. Twenty-seven years on, the system stands accused as being unfair.

In particular, these requirements are that one or more registered trade unions whose members constitute the majority of the members of the trade unions that are party to the bargaining council vote in favour of the extension, and one or more registered employers’ organisations, whose members employ the majority of the employees employed by the members of the employers’ organisations that are party to or a registered with the bargaining council, vote in favour of the extension.

Of the 468,874 employees in the industry a total of 308,605 are employed by the members of the employers’ organisations that are party to or registered with the bargaining council;

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