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The enduring myth of the industrial relations club

The IR club myth

Professor Anthony Forsyth discusses in The Conversation (27.11.14) Sydney Institute director Gerard Henderson’s suggestion that ‘Australia’s system of workplace regulation is really an industrial relations club’.

Forsyth identifes ‘three main aspects of the current portrayal of the IR club that require close scrutiny’. He then explains why they are wrong. First, the claim that the Fair Work Commission is full of people with no business experience. Secondly, the charge that Australia’s centralised and highly-regulated system is no different from 30 years ago. And thirdly, the argument that the Fair Work Commission presides over economically harmful deals, in the interests only of IR club members.

‘IR club warriors like Henderson repeatedly assert that protections of minimum employment standards – such as the minimum wage, and unfair dismissal rights – are the direct cause of unemployment and in particular, youth unemployment. Yet the causal connection between labour market regulation and unemployment is strongly contested in the Australian and international literature.’

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