Reasons for the Decline in Trade Union Membership in Australia Over the Last 35 Years
Student’s Name
University Affiliation
Address
Introduction
There has been a downward trend in the Australian trade union membership since the beginning of the 1970s. By 2016, there were only slightly more than 1.5 million Australian trade union members compared to the more than 2.5 million members in 1976 (Gilfillan & McGann 2018). This is to say that in the last four decades, there has been a decline in union membership by nearly 1 million, which represents 38 per cent. In the same duration, union density, which denotes the trade union members’ share of total employment, has waned to 14 percent from 51 per cent 1976 (Gilfillan & McGann 2018). This decline in trade union membership directly affects the organisation of work within Australian organisations when it comes to the employees’ bargaining power, their involvement, and the welfare of their interests (Bishop & Chan 2019). It has also significantly affected the patterns of wage structure of different unions. This discussion will focus on exploring the various reasons that may have contributed to this decrement in the membership of trade unions in Australia.
Trade Union Membership Decline in Australia
Australian Council of Trade Unions (ACTU) (2020) defines trade unions as organisations that workers establish by coming together to push for fairer treatment at work. Labour movement in Australia can be traced back to the early 19th century when labourers came together to form societies that would push for their interests. Twenty workers’ societies emerged between 1830 and 1850, mostly in Sydney and Melbourne. The labour movements reached an unprecedented level in the 1850s with the Gold Rush of that decade seeing an explosion of wealth in the colony of Victoria and mass migration (Australian Council of Trade Unions 2020). The growth of the unions in Australia continued reaching their peak in the 1880s. Trade unions are chiefly developed to fight for their members’ rights and well-being and work towards neutralizing the super-economic power of employers. The unions focus on pushing for better wages and a better working environment for the members. Many employees choose to be members of trade unions because of their satisfaction with the economic aspects touching their jobs and the urge to influence those economic aspects. Despite the benefits derived from being members of these unions, several Australian trade unions have been experiencing a steady decline in membership over the past 35 years.
ACTU is increasingly concerned by the reduction in union membership and the decline in union density, especially over the past four decades. According to the Australian Bureau of Statistics report, between 2016 and August 2018, the trade union membership in Australia decreased from 15.6% to 15.5% (Forsyth 2018). Up to 40 per cent of all Australian workers were members of trade unions in 1992 (Forsyth 2018). There has been an impulsive decline in this membership since then. From the Australian Bureau of Statistics presented in figure 1 below, there were nearly 2.5 union members in 1976, and this figure has drastically dropped over the last four decades so that by 2016, there were only 1.5 members of trade unions across Australia (Gilfillan & McGann 2018). As depicted in figure 1 below, the density also drastically reduced from 51% to 14% over the same period (Gilfillan & McGann 2018). This worrying trend, therefore, necessitates the need to establish the reasons behind the decline.
Figure 1: Trends in union membership and union density levels between 1976 and 2016
Source: Gilfillan and McGann (2018).
Reasons for the Decline in Trade Union Memberships
Several reasons have been suggested to explain why the trade union membership in Australia has been witnessing a declining trend over the past few decades. Among the most common reasons proposed include economic and social factors, legislative changes, and the collapse of union security arrangements.
Economic and Social Factors
Sympathetic analysts have suggested and deliberated on the relative importance of economic and social factors in the Australian union membership’s declining trend. They have indicated that this trend is witnessed due to the fundamental changes in the labour and product markets so that firms have to operate in a more competitive environment (Minifie 2017). As a result of this competition, these unions’ capacity to increase their labour share at the firm level is limited. These analysts have also observed that there has been a chronic underemployment and unemployment in Australia since 1975, which has consequently led to the decreased bargaining power of the employees both collectively and as individuals. Again, there are reasons to believe that there have been massive cultural changes over the last four decades. More Australians are moving away from collectivism and are adopting more of individualism (Bray & Macneil 2011), and this is coupled with the increase in anti-union attitudes from the employers. Because of these factors, the trade union membership has continued to diminish at worrying rates over the last 35 years.
The Legislative Changes
There have been several radical legislative changes and changes in the legal rights of the trade unions in Australia since 1977. The most obvious of these changes has to do with industrial action. For the better part of the twentieth century, regardless of the theoretical existence of various industrial torts and many other Commission orders, trade unions were in practice at liberty to engage in industrial action. Though industrial action was sparingly used in most industries, this was a card in the background as an option of the last resort when an organiser wanted to make a claim or raise a grievance. It underwrote organising by demonstrating the potential or actual power of the unions. The union movement has, however, lost almost all its de facto rights that it previously held. This stated with the implementation of the statutory prohibitions of secondary boycotts that came into force in 1977 (Browne 2019. Between 1983 and 1994, “No Extra Claim” clauses were introduced, which further limited the unions’ activities. In 2005, mandatory orders were issued against organising unprotected industrial action (Laing 2018). A mandatory restriction on industrial actions that threaten to harm or harms a part of the population’s welfare was also introduced, a move that made it more difficult to partake in industrial actions for in several industries.
Overall, the right to engage in industrial action as a way of pushing for an enterprise agreement, though still significant, is a mere shadow of the previous rights and can barely enable the use of industrial action to resolve an acute dispute at the workplace. Up to the 1980s, the larger proportion of the union strengths was founded on the union’s capacity to resolve workplace issues through threats to use or use of industrial action. The severe loss of the union rights to engage in industrial action is reflected in the figures showing that industrial action has nearly disappeared compared to about 40 years ago. With the loss of their rights and power to fight for the workers’ welfare, many workers today see no need boof being members of these trade unions hence a sharp decline of union membership in Australia over the last 35 years.
The Collapse of Union Security Arrangements
Peetz (1997) suggested that one of the most convincing reasons why union membership and density in Australia has been declining is the collapse of union security arrangements. These included tribunal-sanctioned or tribunal-ordered arrangements that made it compulsory for the workers to be members of at least one trade union or varying levels of preferences in the hiring or retaining members of a trade union, to de facto arrangements that were put forward put trade unions within workplaces. According to Peetz (1997), these arrangements probably led to the rise of trade unions that were less interested in engaging the workers. Trade union preference arrangements’ failure gravely affected the unions’ revenues, their density, and their bargaining power. This development has since undermined the trade unions’ revenue streams that they may have used in adapting to the increasingly hostile environment. In the end, more workers have decided to leave their trade unions or prospective members to stay away from them since they see no benefit being part of the trade unions.
Conclusion
Trade union membership and density in Australia have been rapidly declining for the past four decades. Unions chiefly focus on pushing for better wages and a better working environment for the workers. This decline directly affects the organisation of work within Australian organisations regarding the employees’ bargaining power, their involvement, and the welfare of their interests. The decline in membership and density of the trade unions across Australia were caused by, among other factors, economic and social factors that have brought about cultural changes from collectivism to individualism, The Legislative Changes that have limited the rights and powers of trade unions making them nearly powerless in advocating for the welfare of the workers, and the collapse of union security arrangements that has severely affected the revenue streams of these unions making it possible for them to adapt to the increasingly hostile environment. Indications show that this decline is likely to continue into the next decade.
References
Australian Council of Trade Unions 2020. History of Australian unions. Melbourne, <https://www.actu.org.au/about-the-actu/history-of-australian-unions>. viewed 26 August 2020.
Bishop, J., & Chan, I. 2019. Is Declining Union Membership Contributing to Low Wages Growth? (No. rdp2019-02). Canberra: Reserve Bank of Australia.
Bray, M. & Macneil, J. 2011. Individualism, collectivism, and the case of awards in Australia. Journal of Industrial Relations, 53(2):149-167.
Browne, B., 2019. Secondary boycotts in Australia: History and context. Discussion paper.
Forsyth, A., 2018. New ABS figures show Australian unions have halted membership decline, but the battle is far from over. Labour Law Down Under.
Gilfillan, G. & McGann, C., 2018. Trends in union membership in Australia. Parliamentary Library, Research Paper Series, 19:15.
Laing, N., 2018. The limits of protected industrial action. Bar News: The Journal of the NSW Bar Association, (Autumn 2018).
McAlpine, K. & Roberts, S., 2017. The future of trade unions in Australia. Chris White Online.
Minifie, J., 2017. Competition in Australia: Too Little of a Good Thing? Grattan Institute.
Peetz, D., 1997. The paradigm shift in Australian union membership: A tale of compulsory unionism. In Proceedings of the Association of Industrial Relations Academics of Australia and New Zealand Conference (Brisbane, Australia).