Market power constrained: union and non-union collective bargaining outcomes in the Australian resources sector

Abstract

The Workplace Relations Amendment (Work Choices) Act 2005 is generally regarded as having produced a strong divergence in employment outcomes and opportunities among employment groups and across employment sectors. Whereas poor outcomes are attributed to the lack of bargaining power of disadvantaged and low wage groups, union collective bargaining is seen as having preserved employee entitlements in high wage sectors of the economy. In this paper we examine all forms of collective bargaining in the high-wage resources sector to determine the impact of unionisation on collective bargaining outcomes. To do so, we code and analyse all union collective agreements, employee (non-union) collective agreements, union greenfield agreements, and employer greenfield agreements concluded in the resources sector under the Work Choices legislation. Contrary to expectations, the outcomes of these agreements show strong consistency across a range of substantive and procedural labour standards. These outcomes are attributed to the nature of the product market,employer regulatory objectives, and the adverse effects of Work Choices on union market power.