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How the parties bargain: the nature and reach of Good Faith Bargaining (GFB)

How the parties bargain: the nature and reach of Good Faith Bargaining (GFB). GFB obligations in s. 228 Centrepiece of bargaining framework Bargaining orders (s. 229) & other mechanisms Important role for FWC in oversight & enforcement of GFB.

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How the parties bargain: the nature and reach of Good Faith Bargaining (GFB)

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  1. How the parties bargain: the nature and reach of Good Faith Bargaining (GFB) • GFB obligations in s. 228 • Centrepiece of bargaining framework • Bargaining orders (s. 229) & other mechanisms • Important role for FWC in oversight & enforcement of GFB

  2. Applications for bargaining orders, monthly total

  3. Applications for bargaining orders, by industry

  4. Applications for bargaining orders, by outcome

  5. Assessing the impact of the GFB obligations • Useful in facilitating bargaining • ‘I suppose the good faith bargaining provisions sort of provided an initial push for the company to get along and actually come to the bargaining table …’ • ‘Shadow effect’, i.e. lodgment of application (or threat) sufficient to alter other party’s bargaining conduct • One employer’s view: • GFB is ‘a tool, [but really] it’s … what people work around.’

  6. Assessing the impact of the GFB obligations (2) • Union concerns about the limits of GFB: • ‘At the end of the day the good faith bargaining provisions can be used to bring people to the table, can make them put certain information on the table, but … they don’t seem to assist in any way in terms of actually getting to some sort of outcome.’ • ‘we really believed we would get a couple of [bargaining] orders that we were seeking … [but] if the bar has to be so incredibly high, then what’s the point?’ • Particular concerns re 3rd parties not at the bargaining table; & employer “direct dealing” & “surface bargaining” tactics/conduct

  7. Facilitating bargaining by assisting parties to resolve disputes • Dispute resolution by FWC under s. 240 • Conciliation/mediation – arbitration only if all parties agree • The most utilised of the Part 2-4 mechanisms (60.2% of all applications)

  8. Section 240 applications, monthly total

  9. Section 240 applications, by industry

  10. Section 240 applications, by outcome

  11. Assessing the impact of FWC dispute resolution in bargaining • Mostly used by “repeat players: unions & large, unionised employers • Motivations for using s.240: • 1. to finalise agreement or overcome impasse • ‘… we had reached a point where we weren’t making any progress in the negotiations, and we were really… seeking to have somebody with, I suppose with some authority and some… knowledge, assist with the process…’

  12. Assessing the impact of FWC dispute resolution in bargaining (2) • Motivations for using s.240: • 2. to defuse hostilities • ‘we made [the] application … because we were going through all this, threats and intimidation. But also the meetings were just not at all constructive… so we wanted to get into a forum where we had an independent person sitting there because that tends to make people at least make reasonable … responses. And so we got into that and we went right through the claims. That was the first really civil meeting…’ • 3. as an “exit strategy” & way of “saving face” • ‘There may be times when we say to the employer… there’s an issue where we actually … agree with the employer, but the membership aren’t that keen on it and so, we’re going to take it to [FWC] and take along a posse of members and see if we can get a Commissioner to tell them that it’s not that bad after all and they can accept the offer…’

  13. Assessing the impact of FWC dispute resolution in bargaining (3) • Motivations for using s.240: • 4. to demonstrate all efforts are being made • 5. escalate the dispute • 6. no other option!

  14. Assessing the impact of FWC dispute resolution in bargaining (4) • Effectiveness of FWC’s role under s. 240: • depends on willingness of parties to get involved • difficult where high level of hostility • preference for “interventionist” conciliators • limits of conciliation – arbitration needed where employer determined to resist • lack of awareness among less experienced negotiators

  15. Promoting bargaining among historically excluded workers: the Low Paid Bargaining (LPB) Stream • Highly innovative set of provisions (Part 2-4, Division 9) • Only 3 applications in 3-year period • Aged Care Case – authorisation granted, but excluded employees on existing agreements • ANF GP clinics – authorisation rejected, “logistical difficulties” • Union concerns that LPB won’t deliver improved wages/conditions for employees (not enough compulsion on e’ers; no industrial action) • Some unions have used alternative strategies, e.g. Equal Remuneration Case

  16. Updated FWC case data (to 30.09.13)

  17. Key findings & conclusions • 1. The extent of FWC’s influence is greater than the case data suggests – the “shadow effect” • 2. FWC’s role & influence in bargaining is largely restricted to unionised workplaces • 3. Part 2-4 has different effects for “new”, as opposed to “mature”, bargainers

  18. Key findings & conclusions (2) • 4. FWC’s role is facilitative, not determinative • 5. Parties value the FWC’s role highly • 6. A need for greater awareness of the FWC’s dispute resolution services – especially among new bargainers, & individual bargaining reps

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