Constructive collaboration is key to survival

With IR reform ahead, ACTU Secretary Sally McManus says a crucial lesson from the COVID-19 crisis is the importance of working together.

Most working Australians are experiencing their most challenging time in living memory. The COVID-19 pandemic arrived with little warning and has had profound consequences. The health and economic impacts of this extraordinary crisis have left wage earners suddenly in an age of uncertainty. Jobs vanished overnight, schools closed and the health and wellbeing of our loved ones became a critical concern. Australian workers were crying out for direction and leadership. It was clear that the decisions our nation made in response had to be shaped by us. As secretary of the Australian Council of Trade Unions, I was focused on ensuring we saved as many jobs as possible and that workers had a path through this crisis that offered economic security and a post-coronavirus future.

The work done by the ACTU in conjunction with government demonstrates that our commitment to the wellbeing of working Australians goes beyond politics. Despite the ongoing political campaign in recent years to undermine the role of unions as good faith actors in civil society, our actions speak for themselves. We led the campaign for a wage subsidy and worked with Prime Minister Scott Morrison and business in delivering that assistance to working people. Australian unions walk the walk when it comes to our commitment to working people.

Job security benefits everybody

For leaders, a once-in-a-generation crisis such as this is full of lessons we must heed to ensure Australia emerges as a stronger, fairer country with an economy that works for all Australians, not just the few. The overreliance by business on various forms of insecure employment has been exposed by the pandemic as a critical structural flaw in our economy. While the flexibility of casualisation is an easy way to reduce overheads for some businesses, offering a short-term fiscal sugar hit, it is full of risk for workers and also exposes their companies to deeper structural risks. With about 40 per cent of the workforce engaged in a form of insecure employment, a huge number of working Australians are just a crisis away from economic calamity. When trouble strikes, as it has with COVID-19, hundreds of thousands of Australians working without access to entitlements such as sick pay suddenly face falling through the cracks into economic catastrophe. This trapdoor economics causes massive upheaval as domestic spending tanks and businesses crumple as a consequence. Secure employment, offering certainty to workers, must again become a priority to avoid a repeat of the long queues outside Centrelink offices across the country.

The successful response to the pandemic has put on display just how crucial a well-functioning and supported public sector is in ensuring our economic prosperity. The economy can’t function if communities don’t. Having access to affordable childcare, healthcare, aged care and preventative health resources is central to allowing working Australians to meet the needs of their families. Similarly, providing pathways and funding for training and education opportunities for workers needs to be seen as an investment in the resilience of our economy and communities — and prioritised.

The manufacturing sector is crucial

The pandemic has also shone the light on Australia’s lack of manufacturing capacity and the very real peril we face if we do not re-commit to making things in Australia. Good leadership requires company directors to examine the consequences of continuing to produce goods offshore in low-wage, substandard environments — which reflects poorly on the values of the company and leaves Australia at the end of the supply chain, dangerously dependent on externalities.

Directors can do a lot to make sure their executive teams are getting the benefits for their company of a constructive engagement with an organised workforce. There are real opportunities for those businesses that understand the value of collaborating with workers. Companies that engage constructively with their workers in an organised way, through their union, make productivity gains, pay higher wages and have less workplace incidents.

Righteous remuneration

It is also time for directors to question not just the quantum of executive salaries, but also the gaps between executive pay and that of their workforce. What is the multiple of a CEO’s salary to the average worker in the company? Does a member of the executive team really deliver 50 times more value than your average employee?

If executives can get bonuses through staff attrition, what incentives is that putting in place? If “wage control” is a key metric, how is the company supporting their average and low-paid workers?

That’s the rub. The most crucial lesson to emerge from the pandemic response has been that the only way to navigate these difficult days is together.

It is time for all of us to stop the talk and actually walk the walk.

For more tools and resources on the COVID-19 pandemic, go to our dedicated hub here.