Australian labour law

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Australian labour law concerns Commonwealth, state, and common law on rights and duties of workers, unions and employers in Australia. Australian labour law, has a dual structure, where some employment issues and relationships are governed by Commonwealth laws, and others are governed by state laws or the common law. It shares a heritage with laws across the Commonwealth of Nations, UK labour law and standards set by the International Labour Organization, the Australian legislature and courts have a built a comprehensive charter of rights at work.


Constitutional basis[edit]

The conciliation and arbitration power of the Commonwealth was originally based on Section 51(xxxv) of the Constitution of Australia, which provides:

"The [Commonwealth] Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to:
(xxxv) conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one state".[2]

The Commonwealth's power to make laws about labour law under the conciliation and arbitration power was seen as being extremely narrow and limited. The Commonwealth government sought to widen its industrial powers by other means. For example, in 1906 two bill were introduced that would become the Customs Tariff Act 1906,[3] and the Excise Tariff Act 1906[4] which exempted manufacturers who paid "fair and reasonable" wages to their employees from these duties. The Commonwealth Court of Conciliation and Arbitration in the Harvester case (1907) was required to determine what were "fair and reasonable" wages, but the High Court of Australia in R v Barger (1908)[5] struck down the government's strategy of using the taxation power to enact labour laws as invalid. The Barger decision was made in the context of the then prevailing reserved State powers doctrine,[6] which was itself overturned in 1920 in the Engineers case.[7]

Since 2005, Australian industrial relations laws, such as WorkChoices, have been primarily based on the corporations power in section 51(xx) of the Constitution,[8] which enables labour laws to be of much wider reach, without the constraints imposed by the conciliation and arbitration power.[2] The corporations power gives the federal parliament power to make laws with respect to "trading and financial corporations formed within the limits of the Commonwealth", as well as 'foreign' corporations.

Federal schemes[edit]

Commonwealth Court of Conciliation and Arbitration[edit]

The Commonwealth passed the Commonwealth Conciliation and Arbitration Act 1904, based on conciliation and arbitration power, which sought to introduce the rule of law in industrial relations in Australia and, besides other things, established the Commonwealth Court of Conciliation and Arbitration, whose functions included the hearing and arbitration of industrial disputes, and to make awards. It also had judicial functions of interpreting and enforcing awards and hearing other criminal and civil cases relating to industrial relations law. The Act originally applied to industrial disputes “extending beyond the limits of any one State, including disputes in relation to employment upon State railways, or to employment in industries carried on by or under the control of the Commonwealth or a State or any public authority constituted under the Commonwealth or a State”. Andrew Fisher amended the 1904 Act to provide greater authority for the court president and to allow Commonwealth employees' industrial unions to register.[9]

In disputes involving a company in a single state either a union or industrial organisation will rope them into a federal award by arguing that they are part of an industry in which a dispute extending beyond the limits of any one state exist. (This can be done by finding another company which did similar work and serving them with a log of claims concurrently or by virtue of a company's membership of a peak industry body.) Alternatively, if the company was not covered by a federal Award it would be covered by the various States' industrial relations systems, and disputes are conciliated or arbitrated by the state industrial relations commissions which would create an industry rule Award.

Commonwealth Conciliation and Arbitration Commission[edit]

In 1956, the High Court in the Boilermakers' case held that the Commonwealth Court of Conciliation and Arbitration, as a tribunal exercising the non-judicial power of arbitration, could not also exercise judicial power as a Chapter III Court. The court was abolished in 1956 and was replaced by two new bodies. The Commonwealth Industrial Court was created to exercise the court's judicial powers.[10] In 1973, it was renamed the Australian Industrial Court,[11] and in 1977 its functions were transferred to the new Federal Court of Australia.[12]

The Commonwealth Conciliation and Arbitration Commission was also created in 1956 to carry out the non-judicial functions of the previous Court.[10] In 1973, it was renamed the Australian Conciliation and Arbitration Commission,[11] and replaced by the Australian Industrial Relations Commission in 1988.[a][14][15] The wage fixing function of the Australian Industrial Relations Commission was removed and given to the newly created Australian Fair Pay Commission in 2006 as part of the WorkChoices amendments. Both the Australian Industrial Relations Commission and the Australian Fair Pay Commission were dissolved in 2009,[b] to be succeeded by Fair Work Australia in 2010,[17] and renamed the Fair Work Commission in 2012.[18]

The 1904 Act was amended many times before being superseded by the Industrial Relations Act 1988 and repealed by the Industrial Relations (Consequential Provisions) Act 1988 with effect on 1 March 1989. The Industrial Relations Act 1988 was itself replaced by the Industrial Relations Reform Act 1993, which adopted a decentralized labour law model with support for collective bargaining, rather than the centralised wage-fixing model adopted since the 1970s and formalised under the Prices and Incomes Accord between the Hawke Labor government and the Australian Council of Trade Unions. The Howard Government’s Workplace Relations Act 1996 replaced the Industrial Relations Reform Act 1993.


In 1996, the Howard Government passed the Workplace Relations Act 1996 replaced the previous Labor Government's Industrial Relations Reform Act 1993, with effect on 1 January 1997. In 1996, Victorian referred the bulk of its industrial powers to the Commonwealth.[19] The 1996 Act was substantially amended by the Workplace Relations Amendment Act 2005,[20] which came into effect on 27 March 2006,[21] introducing WorkChoices.

The 2005 Act used the corporations power to override state systems and unify industrial relations systems under a federal umbrella. In modern Australia, where the corporation is almost ubiquitous in business, that effectively meant the corporations power could be used to make laws about almost all employment relationships. As a consequence, WorkChoices had effective control of 85% of the employees in the Australian workforce.[22] The changes created a separate Australian Fair Pay Commission to set wages, and enhanced powers for the Office of the Employment Advocate and a corresponding lesser role for the Australian Industrial Relations Commission.

The constitutional validity of the WorkChoices legislation was challenged in the High Court in New South Wales v Commonwealth.[23] The Court decided by a majority of 5–2 in November 2006 that all the WorkChoices reforms were valid. This was a landmark decision in Australian constitutional law and in Australian federal-state relations, confirming that the width of the scope of the Commonwealth's power in relation to corporations.[24]

A 2008 amendment to WorkChoices further expanded the federal government’s reach into employer-employee relations when it prohibited awards which were determined by reference to state or territory boundaries or did not have effect in each state and territory.[25]

Fair Work Act[edit]

The Rudd Labor Government’s Fair Work Act 2009 (FW Act) repealed the 2005 WorkChoices Act,[17] and established Fair Work Australia (renamed Fair Work Commission in 2012),[18] which commenced operation on 1 July 2009.[26] The Victorian Government has referred most of its industrial relations powers to the Commonwealth, most recently via the Fair Work (Commonwealth Powers) Act 2009 (Vic), resulting in a majority of public sector workers in Victoria being covered by the FW Act.[27]

FWC's functions include the setting and varying industrial awards, minimum wage fixation, dispute resolution, the approval of enterprise agreements, and handling claims for unfair dismissal.

See also[edit]


  1. ^ Every member of the former commission was appointed to the new Australian Industrial Relations Commission, with the exception of Justice James Staples, thereby threatening the independence of Commission members.[13]
  2. ^ The two Vice Presidents of the Australian Industrial Relations Commission, Grahame Watson and Michael Lawler, were appointed to Fair Work Australia, but not as Vice Presidents and two new Vice Presidents were appointed, Adam Hatcher SC and Joe Catanzariti.[16]


  1. ^ Ex parte H.V. McKay (1907) 2 CAR 1.
  2. ^ a b Constitution (Cth) s 51
  3. ^ "Customs Tariff Act 1906". Commonwealth of Australia..
  4. ^ "Excise Tariff Act 1906". Commonwealth of Australia..
  5. ^ R v Barger [1908] HCA 43, (1908) 6 CLR 41.
  6. ^ Zines, L (1981). The High Court and the Constitution. p. 41. ISBN 9781760020248.
  7. ^ Amalgamated Society of Engineers v Adelaide Steamship Co Ltd (Engineers' case) [1920] HCA 54, (1920) 28 CLR 129.
  8. ^ Constitution (Cth) s 51 "The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: (xx) foreign corporations, and trading or financial corporations formed within the limits of the Commonwealth".
  9. ^ Murphy, D. J. (1981). "Fisher, Andrew (1862–1928)". Australian Dictionary of Biography. Australian National University. Archived from the original on 25 May 2011. Retrieved 12 May 2011.
  10. ^ a b Conciliation and Arbitration Act 1956 (Cth).
  11. ^ a b Conciliation and Arbitration Act 1973 (Cth).
  12. ^ Federal Court of Australia Act 1976 (Cth).
  13. ^ Kirby, Michael. "Abolition of Courts and Non-reappointment of Judicial Officers" (PDF). (1995) 12 Australian Bar Review 181.
  14. ^ Industrial Relations Act 1988 (Cth).
  15. ^ Australia's industrial relations timeline
  16. ^ Patrick, Aaron (14 April 2014). "Fair Work Commission bench line-up not so fair, says business". Retrieved 17 February 2019.
  17. ^ a b Fair Work Act 2009 (Cth).
  18. ^ a b Fair Work Amendment Act 2012 (Cth).
  19. ^ The future of state industrial regulation: Can we learn from Victoria?
  20. ^ "Workplace Relations Amendment (Work Choices) Act 2005". Commonwealth of Australia.
  21. ^ "Workplace Relations Act 1996". Commonwealth of Australia. 27 March 2006.
  22. ^ Legislative Council (NSW), Standing Committee on Social Issues (2006). "Impact of the WorkChoices legislation" (PDF). Parliament of NSW. ISBN 9781920788186.
  23. ^ NSW v Commonwealth (WorkChoices case) [2006] HCA 52, (2006) 229 CLR 1, judgment summary (PDF), High Court
  24. ^ Blackshield, Tony. "New South Wales v Commonwealth: Corporations and Connections". (2007) 31(3) Melbourne University Law Review 1135.
  25. ^ "Australian Labour Law". Henry Carus & Associates. Retrieved 8 July 2013.
  26. ^ "History". Fair Work Commission. Retrieved 8 November 2017.
  27. ^ Victorian response to Commonwealth Senate Committee on Education, Employment, and Workplace Relations inquiry

External links[edit]