My research with Associate Professor Stephen Clibborn of the University of Sydney, examining the underlying reasons for this rise, found that these legal restrictions have made it more difficult for unions to assist workers in recovering unpaid wages. Weakened unions have also led to low-wage growth and the prevalence of workers on insecure contracts, which has made it harder for many to secure housing and cover their basic living costs.

Third, Australia’s union laws are more restrictive than in other prosperous and internationally competitive countries. In the Nordic countries, for example, unions have more freedom at the workplace. This gives them powers to negotiate collective agreements regulating virtually all workers’ pay and conditions and ensures employers comply with these agreements.

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In many western European countries, workers have strong rights to collective voice via unions and worker representatives on company boards. This encourages companies to consider a wider set of interests and objectives beyond short-term profit maximisation and ensures they operate more democratically and sustainably.

It helps explain why the income gap between the very top earners – such as CEOs – and lower income earners is narrower in these countries than in Australia where collective worker voice is currently muted. According to the 2022 World Inequality Report, the top 1 per cent of income earners in Australia have an average income 40 times higher than those of the bottom 50 per cent, compared with 26 times higher in western European countries.

Collective worker voice has wider social and economic benefits. Studies have found that countries that give workers strong representation, for example through unions, tend to have higher productivity and employment rates, better workplace safety and wellbeing outcomes, and less inequality including gender inequality.

Employer groups have labelled the proposed reforms as “anti-business”. But international research evidence suggests that measures to strengthen collective worker voice are likely to lead to more productive and sustainable workplaces, help to address the scourge of wage theft and insecure work, and bring Australia into line with global standards.

Chris F Wright is associate professor in the discipline of work and organisational studies and co-director of the Sydney Employment Relations Research Group at the University of Sydney Business School.