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Issue #1742      August 3, 2016

Another union busting weapon

Last week the Australian Competition and Consumer Commission (ACCC) raided the offices of the Construction Division of the CFMEU. This is just the most recent of a number of actions taken by the body against the trade union movement. In a media release issued a year ago (July 30, 2015), its chairman Rod Sims said the ACCC was aware of serious allegations and evidence presented to the trade union Royal Commission concerning alleged cartel conduct in the construction industry in Canberra.

Banner drop by Adelaide branches of the CPA: The slogan “Workers need strong unions like the CFMEU”.

“Cartel conduct such as price fixing, anti-competitive agreements and attempts to bring about collusive arrangements are matters of grave concern to the ACCC,” Sims said. Under the Competition and Consumer Act (2010) (successor to Trades Practices Act 1974TPA) there are civil and criminal penalties for cartel conduct.

The Act focuses mainly on cartels, consumer protection and secondary boycotts. Industrial relations is largely exempted from the Act. There are however, a few exceptions – primarily the secondary boycott provisions which effectively outlaw trade union pickets, but also cartels in certain circumstances.

Cartel activity is usually thought of in terms of corporations fixing petrol prices, rigging bids for government contracts or making agreements on market sharing. For example, Visy and Amcor, who between them controlled around 90 percent of the corrugated fibre packaging market (cardboard boxes, etc), conspired to raise the prices of their products while maintaining their respective market shares. The market was worth some $1.8 billion to $2 billion per year.

These large monopolies are not interested in genuine competition which drives prices and hence profits down. The process of monopolisation and development of cartels operates on a global basis. Monopoly price fixing in transportation, packaging, communications, energy and other critical areas of the economy affects the price of almost everything that other capitalists produce, driving up the price of their inputs.

Hence the creation of such bodies as the ACCC to curb their activities. That is not to suggest that such bodies have been effective in preventing the growth of monopoly capital. Far from it. Not when two corporations can control 90 percent of a market!

Now the ACCC is turning its attention to the alleged operation of cartels involving trade unions and the price of labour. During the Royal Commission, the owner of a Canberra-based scaffolding company claimed that two CFMEU officials told a meeting of employers that they wanted all the companies to agree on a minimum price for wages. If they had agreed that could be construed as cartel activity under the Act. The ACCC has established a specialist team to look at allegations relating to supposed cartel activity by trade unions in the construction industry.

For there to be breach of the Act, it would require proof that employers acted jointly to obey a union demand. This might occur when a union is meeting with contractors and seeking uniform wages and conditions across a construction site. The Harper review of Competition Policy, the Productivity Commission review of the industrial relations framework and the Royal Commission all recommended strengthening the cartel provisions and their application to trade unions. They also suggested that the maximum penalty for trade unions be raised from $750,000 to $10 million, in line with that for corporations.

The ACCC has concerns about enterprise agreements that contain provisions “restricting competition” by such means as nominating a single superannuation fund which is aligned with the union. The ACCC raises concerns about construction companies agreeing to refuse to award tenders to contractors unless they have signed an EBA with the union.

If applied in full, the cartel provisions of the Act would lay the basis for a race to the bottom in wages and working conditions, pitting worker against worker on construction sites and make it even more difficult to negotiate union agreements.

The ACCC, the companies, the government, the Royal Commission, the Productivity Commission are as one in wanting such provisions outlawed. All it would take would be some amendments to the Competition and Consumer Act putting trade unions on the same footing as BHP, Shell and other corporations. If the ACCC finds the evidence it is seeking of cartel activity by the CFMEU, then the union and the officers face hefty fines.

This is part of the process of criminalisation of legitimate trade union activity, and treatment of trade unions as corporations if they were involved in the trade of workers as commodities – the price being wages and working conditions. The increasing interventions of the ACCC facilitates attempts by employers to reduce the price of workers and also undermines the struggle of trade unions to be involved in negotiations for jobs, wages and working conditions.

Attempts to impose minimum wages and conditions and to fight for jobs will become civil and criminal offences.

Who said the class struggle was dead?

Next article – Proposed nuclear waste dump

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