Enterprise bargaining in small business: a comparative study of the Australian construction and hospitality industries

A major change in Australian industrial relations system since the early 1990s has been the shift from conciliation and arbitration to formalized enterprise and individual bargaining. These changes occurred at the federal and state levels. At the federal level, the introduction of individual bargaining through Australian Workplace Agreements (AWAs) and award simplification has resulted in substantially reduced reliance on awards. However, the small business sector has been viewed as reluctant participants in formalized bargaining for various reasons. Despite this reluctance, during the late 1990s there have been increasing numbers of small businesses negotiating collective agreements at the federal level. This article examines 102 certified agreements involving small firms from the construction and hospitality industries in order to identify the outcomes from these agreements. The study found that the increasing incidence of small businesses adopting enterprise agreements are largely due to the fact that state awards have disappeared in Victoria thereby necessitating a move to certified agreements under the federal Workplace Relations Act 1996. The study shows that in small to medium enterprises employees who are highly organized, and represented by unions, can obtain improvements to conditions of employment under enterprise bargaining. These conditions are often obtained through the use of sustained pattern bargaining campaigns, particularly in the construction industry, and especially in Victoria. Conversely, where union coverage is weak employers are capable of using enterprise bargaining to obtain changes in working conditions that, with regard to pay rates, penalty rates and flexible hours of work in particular, are of benefit to the employers and are in some cases a major change to those existing under the award.