Flash Back Friday: Resolution of the Standard Hours Dispute

On Monday of this week some workers in some Australian states and territories enjoyed a public holiday called “Labour Day” or the “8 Hour Day”. This public holiday celebrates the establishment of a baseline expectation that the ordinary working week for full time wage earners in Australia is 40 hours (reduced to 38 hours in 1981). An irony of the celebratory public holiday is that a high proportion of Australian full time workers work significantly more hours per week (and many are not paid overtime, meaning that those additional hours are essentially voluntary contributions to their employer/business and/or significantly reduce their actual hourly earnings). Some research suggests that working greater than 39 hours per week is a health risk. In high salary sectors, critics have started to challenge the cult of over-work, reward for long work hours and addiction to busy-ness.

This post focuses upon the processes that were engaged to achieve the legal milestone, considered to be so significant that most Australian states and territories celebrate it as a public holiday each year. The remainder of this post does not focus upon distinctions between theory and practice in working hours, nor the manner in which industrial relations law has been implemented post 1947.

Australia’s historic commitment to conciliation and arbitration

The Australian Constitution, dated 1901, granted the following legislative power to the Commonwealth of Australia:

conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State (Section 51 (xxxv))

The driver for this power being included in the Constitution was a history of workers’ strikes and industrial unrest, particularly in the 1890s. It was hoped that the Commonwealth would be able to provide an effective way of minimising the disruption and facilitating the resolution of industrial disputes. The Commonwealth first exercised this power in 1904 when it established the Commonwealth Court of Conciliation and Arbitration. Section 2 of the enabling Act of Parliament listed the Court’s chief objects, some of which enshrined dispute resolution principles into law (author’s emphasis):

…(III) To provide for the exercise of the jurisdiction of the Court by conciliation with a view to amicable agreement between the parties;

(IV) In default of amicable agreement between the parties, to provide for the exercise of jurisdiction of the Court by equitable award;

…(VII) To provide for the making and enforcement of industrial agreements between employers and employees in relation to industrial disputes.

It is clear from these objects that the intention was to provide a system that supported amicable agreement between employers and workers, and that conciliation was intended to be the primary means of resolving disputes, with recourse to arbitration occurring where they had been unable to reach agreement. This is further emphasised by section 16:

The President shall be charged with the duty of endeavouring at all times by all lawful ways and means to reconcile the parties to industrial disputes, and to prevent and settle industrial disputes, whether or not the Court has cognizance of them, in all cases in which it appears to him that his mediation is desirable in the public interest.

Although a Commonwealth institution, provision was made in the objects for the Court of Conciliation and Arbitration to take a collaborative and coordinating approach, dealing with matters referred by states and working with state industrial authorities:

(V) To enable States to refer industrial disputes to the Court, and to permit the working of the Court and of State Industrial Authorities in aid of each other.

One of the chief objects of the Act enabled the Court to allow a variety of interested parties to participate in its proceedings:

(VI) To facilitate and encourage the organization of representative bodies of employers and of employees and the submission of industrial disputes to the Court by organizations, and to permit representative bodies of employers and of employees to be declared organizations for the purposes of this Act.

This effectively enabled the Court to invite the participation of organisations that would not necessarily have legal standing (and would rarely be proactively invited to participate) in other contexts.

nla.obj-160959628-1

Fairfax Corporation. 1935, Judge’s associate Miss Mary Drake Brockman seated at a desk at the Federal Arbitration Court, Sydney, 12 February 1935, 1 , viewed 17 March 2017 http://nla.gov.au/nla.obj-160959628

Standard Hours Inquiry 1947

In 1947 the Commonwealth Court of Conciliation and Arbitration approved the 40 hour week through its Standard Hours Inquiry decision. Initially, the matter came before the Court as a dispute between the NSW Printing Industry Employees Union and Printing and Allied Trades Employers Federation about the terms of the printing industry award – essentially about whether the standard hours of work should be reduced from 44 to 40 hours. This was a confined dispute and could have been dealt with as an isolated case. Indeed, technically, all that the Court had jurisdiction to do was to settle the specific disputes that came before it. Where a dispute is confined to a narrow set of parties, and there is a public interest in mediating their dispute, the matter would properly be referred to conciliation. It can be safely presumed that the Standard Hours case was always considered to be of such great public interest, that it would not be an appropriate matter to refer to a private decision making process such as conciliation. The case would not have had much effect on Australian standard working hours had it been settled privately between the NSW Printing Industry Employees Union and the Printing and Allied Trades Employers Federation.

The matter was dealt with through a public inquiry by the Arbitration arm of the Court of Conciliation and Arbitration. The Court began to hear the printing industry case in November 1945 with two parties represented: the Printing Industry Employees Union and the Printing and Allied Trades Employers Federation. In February 1946 the Attorney General for the Commonwealth and the Victorian Chamber of Manufacturers were allowed to join the proceedings. The Attorney-General argued that it wanted to intervene in the case on the basis of public interest in the standard hours in the printing industry. The Court adjourned proceedings for one month:

…to give an opportunity to unions which desired to do so, to raise the general question of a 40 hour week in industry, by lodging applications for variation of awards. (Judgment at p 583).

The Australian Council for Trade Unions and 37 individual unions made application to intervene. The question at this point became whether or not the Court ought to continue with the printing industry case or consider the question of standard hours of work in industry more generally. It was decided that the broader question should be explored, drawing all of the claims together within a single inquiry. The matter adjourned and intervenors were asked to file all necessary documents with the Court.

The inquiry was complex, resource intensive, and long (demonstrating that these case attributes are not necessarily a “new” problem faced by legal systems). Five judges originally presided over the hearings (until one died and another became ill for an extended period of time). The hearing lasted for many months through 1946 and 1947. There were some breaks while the Court dealt with other matters. Some counsel were appointed to the bench and were replaced during the trial. The Court noted that:

Over 22 months have elapsed since the commencement of the case in November, 1945. The Court has before it some 8,875 pages of transcript, has heard evidence from 225 witnesses and received almost 500 exhibits…The immensity of the mass of material placed before this Court in the 158 sitting days occupied by the hearing of this case makes a detailed examination of it all in our reasons for judgement out of the question, if indeed, it is not beyond human capacity (Judgment at p 586).

The Court noted that at the time of judgment the inquiry comprised 100 individual industrial disputes regarding the issue of standard working hours.

Observations about the role of the Court of Conciliation and Arbitration

Their Honours made some observations about the constitutional and jurisdictional limits of the Court on the one hand, and the actual influence that its determinations would have on the industrial landscape on the other:

It is a commonplace of Australian industrial law that the limit of the constitutional power of the Court is to settle each of these disputes within its ambit, and the ultimate judgment will in fact settle these particular disputes, and do no more. But we know, as a matter of practical fact, that it will in the long run lead to uniform standard hours throughout Australia. (Judgment at p 588).

The Court recognised that it would inevitably influence parliamentary reform to standardise workers’ rights. Their Honours also expressed a view that they ought not ignore the “popular will” when making their decision, as the effect of their decision’s impact upon the popular will could be either lowered productivity or increased worker effort (Judgment at p 588). In assessing the “popular will”, the Court was influenced by the fact that four states (NSW, Victoria, Queensland and Tasmania) and the Commonwealth had all intervened and advocated that the Court support the workers’ claims for a 40 hour working week in each of the relevant awards. Western Australia and South Australia had not advocated against the 40 hour week. The Court noted later that the governments who intervened were also some of the biggest employers in Australia (Judgment at p 591).

Broad considerations taken into account

One of the striking observations when reading the judgment is the way that the Court, in recognition of the significant and broad reaching consequences of its decision making in specific applications, took into account a range of broad contextual considerations. The inquiry took place post world war 2, and the fact that there were shortages of both commodities and labour was argued by the employers to be a reason not to stifle productivity levels in industry by granting the 40 hour work week claim. The Court acknowledged that there were many imponderable questions that came to mind when deciding the case:

…how shall we estimate the value of industrial contentment? How shall we measure the human value of it? How far is the shorter week a step on that road to co-operation of the forces of production which is so desirable? How shall we set the family aspects of this increased leisure against foreign trade or the claims of our people against those of other countries? Yet all these are factors which do enter into the fabric of one’s mind and ultimately issue forth in judgment. (Judgment at p 593).

Economic experts offered evidence about the forecast effect of a 40 hour week on national productivity, investment, and foreign trade, as well as the current economic situation in Australia and overseas (noting that the current year was anticipated to be a good one for agricultural production after some years of drought).

Another interesting observation that the Court made was its acknowledgment that a finding adverse to workers would not bring a stop to industrial action and unrest about their claim for a 40 hour working week:

No realist for a minute thinks that a rejection by the Court in these cases would bring about industrial harmony or would abate for an instant the demand for the shorter week. History has shown how persistent in the past have been such claims. There is no reason to suspect that the future will differ. (Judgment at p 590).

The judgment’s conclusion begins with an assertion that the Court was making a “major social judgment which will have very great and important consequences” (at p 610). The magnitude of that responsibility was clearly a weight on the minds of the members of the Court who conducted the inquiry and made the arbitral decisions in the individual disputes before it.

Dispute Resolution Perspective of the Standard Hours Inquiry 1947

The way that the Court of Conciliation and Arbitration conducted itself and delivered its reasoning in the Standard Hours Inquiry demonstrates adaptability, flexibility, and a broad view of what could have been treated as isolated disputes. Examples of adaptability, flexibility and breadth of view included:

  • To allow government intervenors;
  • Inviting unions not already involved in formal claims to make applications raising disputes and effectively expand the reach of the inquiry;
  • Taking a broad systemic approach to the inquiry and decision making while acknowledging the confined limits about what orders could be made to resolve the disputes;
  • Acknowledgement of the consequences the decisions would make beyond the immediate disputes;
  • Explicit acknowledgement of some of the unanswerable questions that occurred to the decision makers during their deliberations;
  • Explicit acknowledgement of the reality that the decision would not necessarily bring an end to the industrial unrest around the disputes.

The Court of Conciliation and Arbitration was a peculiar beast established for the purpose of supporting decision making in a complex area that crosses State and Commonwealth boundaries and affects the Australian community in fundamental and pervasive ways – economically and relationally, at macro and micro levels. The decision makers acknowledged the wider implications and effects of their decision and attempted to them into consideration. The capacity of the Court to make sure that its decisions were well informed by inviting greater participation assisted it to achieve its object of facilitating settlement of industrial disputes. The Standard Hours case is a classic example of a case that needed a well resourced, careful, broadly focused and public inquiry. The establishment of an arbitral process enabled that kind of inquiry to occur.

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About Dr Olivia Rundle

Dr Rundle is a senior lecturer at the Faculty of Law, University of Tasmania. She has worked as a nationally accredited mediator and a Family Dispute Resolution Practitioner. Dr Rundle is especially interested in the role of lawyers in dispute resolution processes and the policy environment that positively encourages lawyers to engage with dispute resolution. She teaches and researches in broad areas of Dispute Resolution, Civil Procedure and Family Law.

One thought on “Flash Back Friday: Resolution of the Standard Hours Dispute

  1. Olivia
    Very interesting and topical. I forwarded this post to a practitioner in workplace relations law and dispute resolution.
    Frances

    Liked by 1 person

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