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Posted: 2022-11-20 04:16:07

Have we wrapped our heads around multi-employer bargaining yet?

It doesn't feel like it.

But it's not a new concept, and researchers say it's working well in multiple countries overseas, so let's get more familiar with it.

Could it work in Australia?

It touches on an old argument

Let's begin with a quote:

"No business which depends for existence on paying less than living wages to its workers has any right to continue in this country.

"By 'business' I mean the whole of commerce as well as the whole of industry; by workers I mean all workers, the white collar class as well as the men in overalls; and by living wages I mean more than a bare subsistence level — I mean the wages of decent living."

That quote comes from US president Franklin Roosevelt. He said those words in 1933 after his National Industrial Recovery Act (NIRA) passed Congress.

Fireside Chat
Franklin Delano Roosevelt, 32nd President of the United States of America, said everyone would benefit if workers were decently paid(Photo by Universal History Archive/Getty Images)

Roosevelt had only been president for three months, and that Act was part of his early attempt to drag the US economy out of the Great Depression.

Historians say the Act ended up being a policy failure, for numerous reasons (part of it was ruled unconstitutional in 1935) but as an early statement of principle from Roosevelt it pointed towards his later and more successful industrial policies.

It was built on the belief that it would be easier to revitalise US economic activity if every worker in the country was decently paid.

Instead of businesses trying to make profits by competing heavily on wage costs (which puts downward pressure on wages), they should dedicate more energy to competing on the quality of the goods and services they're selling.

Roosevelt figured a change in long-standing business attitudes could be achieved by making part of the cost-base non-negotiable: wages and conditions had to improve everywhere.

But he also knew that, for his ideas to work, he'd have to keep the business community onside. Good businesses would need to have confidence that they wouldn't be undercut by bad businesses refusing to play by the new rules.

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