‘Nuclear option’ of Australian workplace relations fizzles out

The “nuclear option” of Australian university industrial relations has misfired after Murdoch University backed away from a radical move to reboot staff conditions.

Union members at the Perth institution have approved a management offer that gives them salary rises, superannuation, job security and other conditions broadly in line with Western Australia’s other three public universities.

The development all but ends bitter wrangling that culminated in the university’s move to have its industrial agreement terminated last September. While the new agreement must be ratified by non-union staff, that now appears a formality.

Murdoch’s September move broke with the normal procedure of rolling over expired enterprise agreements until new ones could be struck. There was speculation that other universities would follow its lead in terminating their enterprise agreements, a strategy dubbed the “nuclear option” by shadow workplace relations minister Brendan O’Connor.

This could have substantially weakened staff’s bargaining power by reducing their employment conditions to those prescribed in a national industry award, which tends to be far less generous than the multi-year enterprise agreements that employees negotiate with individual institutions.

However, other universities resisted the temptation, and Murdoch now appears to have backflipped on its strategy. The National Tertiary Education Union said that the university could have achieved the same result without suffering “massive legal costs and significant reputational damage”.

Gabe Gooding, the NTEU’s Western Australia state secretary, said that the move had compounded the harm to Murdoch’s image from the scandal surrounding former vice-chancellor Richard Higgott, who was suspended in 2014 and later found guilty of serious misconduct by the state’s corruption watchdog.

“The reputational damage to Murdoch has been so immense that it’s probably not a risk [other universities] would want to run,” Ms Gooding said. “It was seen as a significant attack on their own employees.”

She said that the move had also proven a double-edged sword. It had left Murdoch unable to enforce six-month notice periods for staff who resigned, or to offer tempting enough conditions to lure replacements.

Murdoch said that it welcomed the latest development, but would not say whether it now regretted the move to terminate the enterprise agreement.

“The university sought Fair Work Commission help to reset negotiations last year when, following extensive negotiations, the parties remained too far apart on reaching a new enterprise agreement,” a spokesman told Times Higher Education. “The university needed an agreement that reflected modern conditions and that positioned it to meet its future strategic goals.”

The NTEU said that the financially troubled university had committed to spending A$2.8 million (£1.6 million) on legal fees to support its strategy. Murdoch said that it “does not comment on legal matters”.

Gavin Moodie, adjunct professor of education at RMIT University, said that the episode reflected “dysfunctional leadership” that had prevailed at Murdoch since 2011. But he said that the main reason other universities had not copied its approach was that their negotiations had been too advanced.

Dr Moodie said that he expected universities to “at least threaten” to terminate agreements in the next enterprise bargaining round if the option remained open to them legally, and if their financial positions deteriorated substantially in the meantime.

He said that 850 employers had used the same tactics before Murdoch’s move last September.

“This time, universities were following rather than leading attacks on workers’ rights,” he said. “However, there is a pervasive view that university staff enjoy ‘ivory tower’ conditions which many attack as unfair or setting an unfortunate example.”

john.ross@timeshighereducation.com