Interim Report - Report No 281, March 1992

Case No 1559 (Australia) - Complaint date: 22-NOV-90 - Closed

1. 326. The Confederation of Australian Industry (CAI) presented a complaint against the Government of Australia alleging violations of freedom of association in a communication dated 22 November 1990. It presented additional information in a letter of 24 December 1990. The International Organisation of Employers (IOE) expressed its support of this complaint in a letter dated 26 November 1990.
2. 327. The Government sent its observations on the allegations in communications dated 25 October and 4 November 1991.
3. 328. Australia has ratified both the Freedom of Association and Protection of the Right to Organise Convention, 1948 (No. 87) and the Right to Organise and Collective Bargaining Convention, 1949 (No. 98).

A. The complainants' allegations

1. 329. In its letter of 22 November 1990, the CAI states that proposed amendments to the Federal Industrial Relations Act, 1988, contained in the Industrial Relations Legislation Amendment Bill of 1990, unreasonably restrict the registration of new employees' organisations of their own choosing in individual enterprises and small industries and restrict the free choice of employees.
2. 330. The background to the allegations is as follows. The provisions of the 1988 Act permit the registration of employees' and employers' associations subject to their compliance with a number of requirements. Registration is essential if an association is to participate effectively in the system of conciliation and arbitration, and of labour relations in general, established under the Act. Section 189(1) of the Act, before the amendments, provides for registration if:
   • (c) in the case of an association of employees:
   • (i) the association has at least 1,000 members who are employees; or
   • (ii) the designated Presidential Member is satisfied that special circumstances exist justifying the association's registration
     • and the association meets certain other requirements set out in the section. Section 193 of the Act contains provisions relating to the continued registration of a "small organisation", which is defined in section 193(7) as: "... an organisation of employees that has fewer than 1,000 members who are employees". Section 193(1) provides that:
     • A designated Presidential Member is empowered to consider, in relation to a small organisation, whether special circumstances exist that justify the continued registration of the organisation in the public interest.
     • Section 193(6) provides that:
     • Where, on exercising the power conferred by subsection (1), a Presidential Member is not satisfied that special circumstances exist that justify the continued registration of a small organisation in the public interest, (he) shall cancel the registration of the organisation.
     • Other provisions of section 193 require a designated Presidential Member to consider the above issues during the relevant period, which is defined as: "the period beginning three years after the commencement of this section and ending four years after that commencement". The complainants points out that the 1988 Act, including that section, commenced operation on 1 March 1989.
   • 331. According to the complainants, the 1990 Amendment Bill proposes, in clause 12, to change section 189 of the Act by substituting the figure 20,000 for the figure 1,000 therein and proposes, in clause 14, the replacement of section 193 by new sections 193 and 193A so as to create two categories of small organisations. The first type would be defined as: an organisation of employees that has fewer than 1,000 members that are employees (stage 1); for such organisations, a designated Presidential Member is required to start considering whether special circumstances exist justifying continued registration during stage 1, defined as the period beginning on 1 March 1992 and ending on 28 February 1993; if he is not so satisfied, the Member must cancel the registration. The second category is defined in section 193A as an organisation of employees that has fewer than 20,000 members who are employees (stage 2), and for such organisations the period for considering whether special circumstances exist begins on 1 March 1994 and ends on 28 February 1995. Again, if the designated Member does not so find, he must cancel the registration of that small organisation.
3. 332. The complainants therefore allege that the current Act restricts the registration of new associations by requiring that such associations have at least 1,000 members who are employees, an unreasonable requirement restricting freedom of association because employees have no freedom to form organisations of their own choosing in small industries or at the individual enterprise level. In addition, the provisions of the Bill which seek to increase the minimum membership level for registration purposes to 20,000 constitute a further unreasonable restriction as they would effectively prevent employees from choosing to form organisations in individual enterprises and small industries. Lastly, in the complainants' opinion, the provisions of both the Act and the Bill which require a review of the registration of existing organisations having fewer than 1,000 (stage 1) or 20,000 (stage 2) and the cancellation of such registration if special circumstances are not seen to exist, infringe the principles of freedom of association. For example, the implementation of the 20,000 membership requirement would require the cancellation of 104 organisations of employees out of a current total of 149.
4. 333. The complainants point out that the Act and the Bill have the following effects on employers and employers' associations:
   • (a) the provisions restrict the nature of the employees' associations with which employers must deal within the legislative scheme, and in particular hinders the development of enterprise-based and industry-based associations;
   • (b) the provisions require the cancellation of the registration of many employees' organisations with which employer associations have an established relationship;
   • (c) the provisions promote the establishment of very large employees' organisations, thus bringing about an alteration in the relative strength of organisations of employees and of employers and their associations.
5. 334. In its letter of 24 December 1990, the CAI advises that on 20 December the Australian Parliament passed the 1990 Amendment Bill with the following changes of relevance to its complaint: section 189(1)(c)(i) will now contain the figure 10,000 instead of 1,000; section 193A will now define the second category of small organisation as "an organisation of employees that has fewer than 10,000 members who are employees"; and section 193A now defines the stage 2 period for considering whether special circumstances exist to run from 1 March 1993 to 28 February 1994. The CAI attaches a copy of the Senate debate on the Bill during which the Minister for Industrial Relations made a statement emphasising the broad discretion available to the designated Presidential Member when determining whether "special circumstances" exist under sections 193 and 193A. The Minister gave examples of elements justifying continued registration and pointed out that "the special circumstances test is not intended to be narrowly or rigidly applied". The CAI believes, however, that the Minister's statement concerning the discretion to be used in favour of the continued registration of the so-called small organisations does not provide a sufficient guarantee of freedom of association. Notwithstanding the final text of the amendments, the complainants maintain their allegations, pointing out that the 10,000 membership level would mean the cancellation of the registration of 92 employees' organisations out of a total of 149.

B. The Government's reply

1. 335. In its letters of 25 October and 4 November 1991, the Government states that it strongly supports the principles of freedom of association enshrined in the Conventions, and does not consider that they have been infringed in this case. It cites the constitutional provision in pursuance of which the Industrial Relations (IR) Act was passed by Parliament in 1988 and commenced on 1 March 1989. Among other things the Industrial Relations Act: (a) establishes an independent industrial tribunal, the Australian Industrial Relations Commission (the AIRC) whose primary responsibility is the prevention and settlement, through the exercise of conciliation and arbitration powers, of industrial disputes within its jurisdiction; and (b) provides for the voluntary registration of organisations of employees or employers, which results in such organisations having certain rights and obligations within the federal industrial relations system.
2. 336. The Government adds that each state in Australia has provided for its own industrial relations system which operates within the state concerned in relation to matters outside the federal jurisdiction or with which the AIRC is not dealing. The Government does not describe the state systems in detail as the complaint relates only to the federal system. It notes, however, that the industrial relations legislation of each of the states also establishes industrial tribunals with powers of conciliation and arbitration, and provides for the registration or formal recognition of associations of employers and employees. According to the Australian Bureau of Statistics, 31.5 per cent of employees have their employment regulated by awards made by the AIRC and 46.5 per cent by awards made by state tribunals. Twenty per cent are entirely award-free (approximately 2 per cent are covered by awards of an unknown character).
3. 337. The Industrial Relations Act enables associations of employers and employees to apply for registration for the purposes of the Act, such registration being incidental to the prevention and settlement of disputes within the federal system. Certain statutory requirements must be met (sections 188, 189, 194-201) and there is a hearing before the AIRC to determine whether an application should be granted (section 189; Part VII, division 1 of the Industrial Relations Regulations). Registered organisations and other interested parties (e.g. state unions or employers) may object to an association being registered (reg. 36) and such objections must be heard and determined before an application is granted (reg. 37). Registration under the Industrial Relations Act occurs following a voluntary application and is not a precondition to the formation and operation of an industrial association or trade union. The formation and registration of organisations is, however, encouraged under the Industrial Relations Act: section 3(3)(f) lists as one of its objects that of encouraging the organisation of representative bodies of employers and employees and their registration under the Act.
4. 338. Such registration confers a number of benefits on an organisation, but also carries with it certain obligations. The benefits include: (a) the conferral of corporate status on the organisation concerned, with attendant rights to hold and dispose of property and to sue and be sued in the name of the organisation (section 192); (b) a specified area of industrial coverage in accordance with the registered rules of the organisation (section 195) with the consequent right to make claims which come within the AIRC's jurisdiction on employers in relation to members and persons eligible for membership of the organisation; (c) the right to seek enforceable awards, whether by consent or arbitration, from the AIRC (sections 99, 110-115) in relation to the employment of such individuals; (d) the right to object, in proceedings before the AIRC, to other organisations gaining coverage, whether by an award or a rule change, of work which comes within the registered rules of the objecting organisation (sections 111(i)(g), 204, 253 and associated regulations); (e) the standing to bring proceedings in a court to enforce a federal award to which the organisation is a party (sections 58, 178); (f) the right to seek the settlement, by arbitration if necessary, of disputes with other organisations over demarcation of work (section 4(1): definition of "industrial dispute"; sections 118, 118A); (g) the statutory protection of members of the organisation against employment discrimination for various reasons, including membership of or participation in the affairs of the organisation (section 334).
5. 339. At the same time, registration involves a number of obligations including: (a) compliance with certain statutory requirements designed to ensure the democratic control of organisations by their members and the protection of their interests (Part IX of the Industrial Relations Act); (b) the duty to notify the AIRC of disputes to which the organisation is a party (section 99) and to appear before the AIRC when required in proceedings in relation to a dispute to which the organisation is a party (sections 111 and 119); (c) acceptance, subject to the rights of appeal, of the decisions of the AIRC in matters affecting the organisation concerned and its members (non-compliance with awards and orders of the AIRC is a ground for seeking the cancellation of an organisation's registration - section 294).
6. 340. The Government explains how any association of employees may apply for registration under the Industrial Relations Act provided that: (a) some or all of the members of the association are "employees" (defined in section 4(1) to include persons whose usual occupation is that of employee) who are capable of being engaged in an industrial dispute, and the other members (if any) are (i) officers of the association or (ii) are treated as employees for the purposes of specified state industrial relations legislation (section 188(1)(b)); and (b) the association is effectively representative of the members who are employees (section 188(2)). The criteria for registration used by the AIRC when hearing an application for registration are: (a) the association is a genuine association of the kind referred to in section 188 and is an association for furthering the interests of its members (section 189(1)(a)); (b) the association has at least 10,000 members who are employees (prior to the commencement of the 1991 Act the prescribed minimum membership was 1,000), or the AIRC is satisfied that there are special circumstances which justify registration of the association (section 189(1)(c)); and (c) the association meets other requirements, not relevant to this complaint, set out in section 189.
7. 341. The Government states that the 1991 Act introduced new sections 193 and 193A to provide that the registration of "small organisations" be reviewed to ascertain whether their continued registration as an organisation under the Industrial Relations Act is justified in the public interest. Where the designated Presidential Member is not satisfied that special circumstances exist that justify the continued registration, the registration of the organisation shall be cancelled (sections 193(7) and 193A(7)). The review of the registration of "small organisations" is to be carried out in two stages. Stage 1 is dealt with in section 193, for the purposes of which: "small organisation (stage 1)" means an organisation of employees that has fewer than 1,000 members who are employees; and covers the period beginning on 1 March 1992 and ending on 28 February 1993. Stage 2 is dealt with in section 193A, for the purposes of which: "small organisation (stage 2)" means an organisation of employees that has fewer than 10,000 members who are employees, and covers the period beginning on 1 March 1994 and ending on 28 February 1995.
8. 342. According to the Government, in addition to increasing the number of members an organisation must have to qualify for registration, the Industrial Relations Act was substantially amended to facilitate the easier amalgamation of registered organisations.
9. 343. The Government notes that the complaint claims that the minimum membership requirement of 10,000 could result in the cancellation of the registration of 92 organisations of employees out of a total of 149. In fact, as at 30 June 1990, there were only 139 registered unions and, in addition, the figure of 92 is misleading because a considerable number of federally registered unions is participating in a programme of voluntary amalgamations in line with the policy of the union movement.
10. 344. The Government considers that the information provided by the complainants is unfairly selective and misleading. When the legislative requirements which are the subject of the complaint are considered in the overall context of the Australian industrial relations system, the objections are not sustainable. Firstly, as for the requirements for registration, the Government replies that there are several factors which have been overlooked which, when taken into consideration, eliminate the possibility of the minimum membership requirements being taken to infringe freedom of association standards. These factors are: federal registration is not a precondition to the formation or operation of a trade union (for example, the CAI is not a registered body and of its 34 member organisations and affiliates only eight are registered under the Industrial Relations Act); such registration is entirely voluntary; registration under the Industrial Relations Act would normally be of marginal value to a small enterprise union; the Industrial Relations Act does not prohibit unions with fewer than 10,000 members from being registered: rather it requires them to demonstrate what "special circumstances" exist that warrant their registration; the members of an unregistered union can, if capable of being party to an interstate dispute, come within the AIRC's jurisdiction; provision is made in the Industrial Relations Act to permit the 150 or so non-federally registered unions and other interested parties (including employers) to object to decisions being made by the AIRC in favour of federally registered unions to the disadvantage of parties whose industrial relationships are conducted outside of the AIRC's jurisdiction; various provisions exist under federal and state legislation which foster and facilitiate constructive and cooperative voluntary relationships between federally registered unions and state registered unions, including by permitting shared membership and resources; the changes to the Act have the overwhelming support of federal and state trade unions, expressed through the biennial congresses of the Australian Council of Trade Unions.
11. 345. The Government stresses that participation in the federal system of industrial relations established by the Industrial Relations Act is not necessary for the successful operation of a union. Fewer than half of the unions in Australia are registered under the Industrial Relations Act. Many unions have chosen to operate solely within the geographical limits of a state. According to the census of trade unions by the Australian Bureau of Statistics (30 June 1990), there were 295 unions in Australia, of which less than one half (139) were federally registered. Many state branches of federally registered unions have counterpart state unions, with overlapping membership, shared property and the same officials holding office in the federal branch and the state union. Some state unions have no federal counterpart. Provisions exist under federal and state laws to facilitate the relationship between federal and state unions, including through permitting membership of a federally registered union by members of a counterpart state registered union, even though the federally registered union's eligibility for membership rules are not identical with those of the state registered union (section 202 of the Industrial Relations Act). In addition, the implications of the federal system of union registration has previously been considered by the Committee on Freedom of Association. In Case No. 1511, presented by the International Federation of Air Pilots Associations (IFALPA), the Committee concluded, in relation to the registration under the Industrial Relations Act of the Australian Federation of Air Pilots (AFAP) (277th Report, para. 229):
    • The Committee does not consider that these events disclose any breach of the principles of freedom of association. Registration under the 1988 Act is optional. The AFAP had elected to register, and to accept the advantages which derive therefrom. The Committee considers that it is reasonable for the legislation, and the AIRC, to require adherence to the norms of the system of conciliation and arbitration as part of the quid pro quo for these benefits. This does not appear to be in any way inconsistent with the guarantees provided by Articles 2 and 3 of Convention No. 87, or by Article 4 of Convention No. 98. Workers can form and join the union of their own choosing. That union can then elect to register under the federal Act if it wishes. Alternatively, it may register under one or more of the state Acts, or it may remain unregistered. Whether registered or not, it may formulate its programmes in full freedom. It may also engage in free collective bargaining.
12. 346. The Government also stresses that a union is free to seek federal registration or not, as it chooses. If it becomes registered, it has more ready access to the federal scheme of dispute resolution, obtains certain benefits and incurs certain obligations. In addition, it cannot be argued that the element of choice is illusory, for example, by claiming that the disadvantages of not being registered are so great that a union must be federally registered or perish, because a union can be formed and operate outside the federal system (as the majority of Australian unions has chosen to do) and because a union which is not federally registered has the right to challenge the use of the federal system by federally registered unions to encroach on its own area of operation.
13. 347. The Government emphasises the irrelevance of the federal system to enterprise unions. For consitutional reasons, the jurisdiction of the AIRC can, in the great majority of cases, only be involved where there is, or is likely to be, an interstate industrial dispute. Yet, the size and geographical dispersion of enterprises in Australia is such that most enterprise unions would have members only in a single state. Although theoretically possible, bargaining between such a union (enterprise unions are uncommon in Australia) and the relevant employer would be unlikely to occur in the context of an interstate dispute. At this level, direct negotiation or resort to the state systems of conciliation and arbitration, if required, is far more likely and practical.
14. 348. As for the special circumstances test, the Government explains that registration under the Industrial Relations Act of a union with fewer than 10,000 members is not prohibited. Instead the union concerned must demonstrate to an independent tribunal (the AIRC) that, although the union does not meet the threshold membership requirement, there are positive reasons which, having regard to the objects of the Act, warrant the union's participation in the federal industrial relations system as a registered organisation. The AIRC has a broad discretion and there is a clear legislative intention that the requirement not be applied unreasonably or inflexibly. Any decision is reviewable on appeal.
15. 349. Another factor of weight for the Government is the formal participation by members of an unregistered union in the federal system. It is settled law in Australia that a specific group of employees is capable of being party to a dispute within the jurisdiction of the AIRC and those employees may, in their own right, collectively be parties to a federal award. In practice, such instances are rare, reflecting the generally stable nature of union representation and inter-union relationships in Australia. It is also true that such an approach is somewhat cumbersome and has other drawbacks compared with participation in the federal system by a federally registered union. Even so, it would not be correct to infer that the federal system exists purely for the benefit of its registered organisations. The central objective of the system, as already mentioned, is to prevent and settle interstate industrial disputes, irrespective of whether the parties are registered under the system.
16. 350. According to the Government, protection in the federal system can extend to the interests of unions that are not federally registered. Under the Industrial Relations Act, a union which is not federally registered is able to: apply to the AIRC in relation to a proceeding before it, requesting that the AIRC dismiss the matter or refrain from dealing with it because the matter is proper to be dealt with by a state industrial authority, or further proceedings are not necessary or desirable in the public interest (sections 111(1)(g) and 111(2); regulation 134); and object to the widening of a federally registered union's industrial coverage (sections 204, 253; regulations 51, 73). It is also open to an interested employer who is involved in a dispute or who is likely to be affected, to object, either as a party or as an intervener (section 43) to action by the AIRC.
17. 351. The Government maintains that the legislative arrangements foster and facilitate relationships between federally registered and state registered unions. The Australian system is characterised by close relations between federally registered unions and counterpart state registered unions. It is common for branches of federally registered unions to be separately registered as state unions, thereby obtaining a separate legal personality. The federal and state unions concerned sometimes have shared resources and overlapping memberships. Although conflict sometimes occurs between federal and state unions with overlapping industrial coverage, machinery exists to resolve such conflict. The Industrial Relations Act seeks to encourage cooperation and avoid legal or practical difficulties by: allowing the unions to have an agreement permitting the members of the state union to be admitted to membership of the federal union, even though they do not come within the federal union's eligibility rules, and to participate in its internal affairs (section 202); or by validating certain invalidities arising from the participation in a federally registered organisation's affairs of persons not entitled under its rules to be members (e.g. members of a state union who have mistakenly been treated as members of the federal union); or by calling for joint hearings of the AIRC and state tribunals to facilitate the resolution of related matters arising within the federal and state jurisdictions (e.g. where federal and state unions have simultaneously made claims in relation to the same work or industry) (section 175).
18. 352. Lastly, the Government highlights the union support for the legislation. According to the Australian Bureau of Statistics, 54 per cent of employees in Australia belong to federal or state unions and, of the 295 unions identified, 127 representing almost 2.8 million workers (over 80 per cent of all union members) are affiliates of the peak national trade union body, the Australian Council of Trade Unions. The ACTU was fully consulted over the changed membership requirements and agreed to them. The Government cites a letter from the ACTU to the Government stating that the ACTU does not support the complaint in any way:
    • ... the ACTU regards the complaint as not genuine and designed solely for political purposes and to weaken the organisation of workers in Australia by promoting the development of tamecat enterprise unions;
    • the ACTU endorses the legislation concerned, over which it was fully consulted, and considers that it is fair, practical and appropriate for the federal industrial relations system;
    • the ACTU notes that unions with fewer than 10,000 members are not excluded from registration, so long as they demonstrate that there are particular circumstances which justify their being admitted to or remaining in the federal system as registered organisations, and meet the other statutory registration requirements which apply to all unions;
    • the ACTU's policy, overwhelmingly endorsed by affiliates at the 1991 ACTU Congress, is for the progressive rationalisation of union coverage;
    • this policy, which reflects the maturity of Australia's union organisation, is to be achieved by unions voluntarily amalgamating under the Act, which permits the members of the unions involved in such amalgamations to participate in a ballot to decide whether an amalgamation should proceed;
    • the ACTU notes that the Act does not apply to or affect affiliates and other unions which are outside the federal system, particularly those operating under state systems (that is, the majority of ACTU affiliates).
    • No other peak union body, or any union, has communicated with the Australian Government objecting to the operation of the legislation since it took effect.
19. 353. The Government points out that, since the 1991 Act took effect, there has been considerable use of the revised amalgamation provisions. Seventeen amalgamations involving 41 federally registered unions have been approved by the members concerned. When all of these voluntary amalgamations take effect, the number of federally registered unions will have been reduced by 25. In addition, 20 federally registered unions are currently participating in the processes relating to eight proposed amalgamations. A large number of other federally registered unions have begun negotiations for this purpose or are about to do so. Of the 38 federally registered unions with fewer than 1,000 members which were registered when the Industrial Relations Act took effect in 1989, 12 have already voluntarily amalgamated with other federally registered unions and four are currently involved in formal amalgamation processes.
20. 354. Regarding the allegation that the stage 1 and stage 2 reviews and cancellation of registration unless special circumstances exist are an unreasonable restriction on the continued registration of such organisations and infringe the principles of freedom of association, the Government argues that the complainants have failed to present the provisions in context. For example, it points out that:
    • (a) all unions have had considerable notice of the forthcoming reviews since small organisations with fewer than 1,000 members were given three years from the commencement of the Industrial Relations Act to prepare for the review (commencing 1 March 1992) of their continued registration, and small organisations with fewer than 10,000 members were given over two years from the commencement of the 1991 Act for that purpose (the reviews commence on 1 March 1993);
    • (b) small unions with fewer than 1,000 members and those with fewer than 10,000 members are free to seek to increase their memberships by recruitment or amalgamation, or to remain as they are and instead argue their case before the AIRC;
    • (c) the review will be conducted by a Presidential Member of the independent AIRC (who, under the Industrial Relations Act, has judicial status), with a hearing at which the union concerned can put its case, and there is a right of appeal to a full bench of the AIRC;
    • (d) the Presidential Member must ascertain whether there are special circumstances and, if so, the union's registration is not to be affected;
    • (e) it is open to the Presidential Member to adjourn a matter, if he or she considers that the small organisation concerned is making all due efforts to achieve the threshold membership requirements.
21. 355. Stressing that the Presidential Member has a wide discretion as to what constitutes "special circumstances", the Government refers to the Senate debate statement of the Minister for Industrial Relations on the interpretation of the term "special circumstances" in the context of revised section 193 and new section 193A. Under the Acts Interpretation Act, 1901, such a statement may be referred to by a court to clarify the purpose of the legislation.
    • Even so ... it does not follow that the national system has no place for unions with fewer than 10,000 members. It is precisely for this reason that a special circumstance exemption is to be available. A question has arisen about its width. There are two related elements to the proposed exemption. The first is the demonstrated existence of special circumstances. The Bill does not define the term "special circumstances". This is deliberate; to attempt to define it would defeat the aim of providing a broad discretionary power. The objective is to provide a discretion which has flexibility and which admits full scope to take account of the facts of particular cases. The second element is that where there are such special circumstances, it is in the public interest for the organisation's registration to continue. It will be entirely for the designated Presidential Member, when exercising this discretion, to determine whether these elements are satisfied, but the discretion will not be exercised in a vacuum. A statutory discretion must be exercised having regard to the scope, objects and purpose of the Act in which it is found. In the case of the Industrial Relations Act, this requirement is reinforced by section 90. Under that provision, the Commission must in the performance of its function take into account the public interest and for that purpose have regard to, among other things, the objects of the Act ... of promoting industrial harmony and cooperation among the parties involved in industrial relations in Australia.
22. 356. The Government argues that even if it is decided that a union's registration is to be cancelled, such cancellation does not extinguish the union's existence; does not affect the union's rules, its membership, its property rights, or its legal rights and liabilities; does not prevent the union from bargaining outside the federal system, whether by participation in a state system or otherwise; but does exclude the union from continued respondency to awards of the AIRC.
23. 357. Lastly, the Government contests that employers will suffer because the structure of the union movement is not dependent on the interests and convenience of employers. The membership requirements will not entail any additional difficulty for unions in forming, or seeking to register, new industry unions. There would be few, if any, industries which do not have 10,000 employees working in them. The union movement itself has, through its policy of voluntary rationalisation, begun to reform along industry lines. The Government cites examples of industry unions already registered under the Industrial Relations Act (e.g. the Finance Sector Union, the Australian Public Sector Union, the Vehicle Builders Employees Federation, the National Union of Rail Workers). It claims that it is unlikely that many enterprise unions would have any interest in participating in the federal system, since, as a matter of practicality, they would conduct their affairs at the state level. It notes that some enterprise unions have been registered under the Industrial Relations Act where the employer concerned is a large, national corporation (e.g. the AMP Society Staff Association, the CSR Limited Officers Association and the Commonwealth Bank Officers Association), but such unions have become less common, with workers preferring to belong to larger industry or cross-industry unions. In fact, the AMP union has voluntarily amalgamated to become part of the Finance Sector Union. For those "small" organisations which are subject to review and whose registration is cancelled, their existence and their capacity to operate outside the federal system will not be affected.
24. 358. In any case, the Government does not accept the argument that, in freedom of association terms, one can complain that unions are likely to become larger, better organised and stronger. This is particularly so where the formation of large unions is to be achieved by voluntary amalgamation which must be approved by the members in secret ballots. In any case, this aspect of the complaint is somewhat misleading because the 37 unions with more than 20,000 members represent 86.4 per cent of the members of all federally registered unions, and the great majority of employers and their representative bodies which participate in the federal system are accustomed to dealing frequently with the largest federally registered unions. The Government points out that, at the federal level, large, national unions are the key participants from the workers' side. In practice, the relative bargaining positions of employers and workers in the federal system have long been characterised by the predominant roles of employer associations and the larger federally registered unions.
25. 359. In conclusion, the Government stresses that the purpose of the legislation is to strengthen the federal industrial relations system by introducing a mechanism to ensure that participating unions are sufficiently well organised and resourced to represent their members effectively in the national system. That mechanism is not designed to lead to the automatic exclusion of smaller unions from the system, but to require them to demonstrate that there are positive reasons justifying their participation in a national level system as registered bodies. Failure to do so does not result in their dissolution or incapacity to function as unions, or in their complete exclusion from the federal system. The legislation does not detract from the freedom of workers to form or to join a union of their own choosing, or for such unions to operate effectively.

C. The Committee's conclusions

1. 360. The Committee notes that this case concerns two aspects of the Industrial Relations Legislation Amendment Bill which was passed by the Australian Parliament on 20 December 1990 and came into force on 1 January 1991. The complainant employers' association alleges on the one hand that the 10,000 membership requirement now figuring in section 189 of the federal Industrial Relations Act is too high a threshold and for many reasons infringes the principles of freedom of association; on the other hand, it alleges that the discretion appearing in sections 193 and 193A to allow the continued registration of an already registered, but "small", organisation is not a sufficient guarantee of freedom of association. It also points to the difficulties it, as an employer body, will have working under these new provisions in practice.
2. 361. The Committee also notes the Government's detailed reply to these allegations, which can be summarised as follows: the system set up under the Industrial Relations Act and continuing with the 1991 amendments is optional and if workers' organisations do not like its provisions or cannot meet its requirements, they are free to, and do (statistics supplied), operate outside the federal industrial relations system; provisions exist allowing members of unregistered unions to have a certain access to the system; the amendments were supported by the peak national union body in Australia (the ACTU) which favours rationalisation of workers' organisations in the context of the 139 existing ones; the review of existing registrations of "small" organisations is fair, independent and is to be undertaken with wide discretion given to whether special circumstances exist allowing such registrations to stand; any inconvenience suffered by employers' bodies is not a valid argument to refute changes introduced to strengthen the union movement and, moreover, might not be suffered since most enterprise unions do not operate at the federal level anyway.
3. 362. Having examined the statements made by the complainant and the Government, the Committee notes that the amendments made in 1991 to the Federal Industrial Relations Act have the effect of preventing trade union organisations with less than 10,000 members from having access to the federal conciliation and arbitration system. However, exceptions to this rule may be granted with a view to maintaining the registration of organisations if so justified by special circumstances in the public interest.
4. 363. In order to be able to reach its conclusions in full knowledge of the present case, the Committee requests the complainant organisation and the Government to supply information on the consequences of these amendments on the activities that can be undertaken by these trade union organisations. The Committee also requests the Government to describe the nature and scope of the "special circumstances" which may justify granting an exception to the minimum threshold of 10,000 members.

The Committee's recommendations

1. 364. In the light of its foregoing interim conclusions, the Committee invites the Governing Body to approve the following recommendations:
   • (a) The Committee observes that the 1991 amendments to the Federal Industrial Relations Act have the effect, unless exceptions are granted, of preventing trade union organisations with less than 10,000 members from having access to the federal conciliation and arbitration system.
   • (b) The Committee requests the complainant organisation and the Government to supply information on the consequences of these amendments on the activities that can be undertaken by these trade union organisations.
   • (c) The Committee also requests the Government to describe the nature and scope of the "special circumstances" which may justify granting an exception to the minimum threshold of 10,000 members.