Arbitration Court Delivers Its Judgment

Chronicle (Levin), 16 August 1947, Page 6

Arbitration Court Delivers Its Judgment

^WELLINGTON, August 15. The Court of Arbitration toniglit delivered a lengthy written judgment in the case in which employers and workers throughout the Dominion have been keenly interested. It was the applieation made on behalf of the New Zealand Federated Furniture and Related Trades Industrial Association of Workers for a standard wage pronouneement. The court 's judgment states : — "After taking all relevant faetors into consideration the Court has decided that the standard minimum rates of wages for adult workers will in future be as follow : — . Skilled workers: 3/7 per hour. Semi-skilled workers : 3/21 to 3/5£ per honr. Unskilled workers: 3/11 per hour." The above rates are gross rates and -are not to- be increased by the applieation of the jjrovisions of the Court 's general orders of August 9, 1940, and March 31, 1942."

The Court in its finding says: "At the outset because of the appearance oi nuinerous misleading references in tlio press we wish to state with some- em phasis: (1) That thcre is uo applieation t'or a general wage order before the Court; and (2) that in the absence of any such applieation the Court has^ no power to consider the making of a general wage order." It continnes that in the applieation before the Court it was requested thai the award be amended "by adding * sixpence to the rates of remuneration • and converted to the weekly wage". It was explained that oue objeet of the J amendment was to extend the benefits ; of the weekly wage to all workers. The regulations authorised the Court to ' amend the provisions of awards and 1 industrial agreements relating to rates j of remuneration. If the claim were granted it would seem that the Court ' vvould be introducing variations in coil ditions of employment other than the preseribed rate of remuneration. In the case of an industrial agreement, for example, in which the parties have mutuallv agreed upon an hourly rate of wages and employment by the hour the question was whether the Court hau power under the regulations to impose upon them an amendment requiring tne remuneration to be paid on a weekly basis ;yul carrying with it the principle of the indivisibiiity of the weekly wage. The questions of authorised deductions from the weekly wage and the period of notice of termination of employment were also involved. The Court* had grave doubts whether it 1 possessed such jurisdiction and therefore declined to accede to the claim that the hourly rate preseribed in the award under consideration should be converted to a weekly wage. Moroever, it was not satisfied that all workers in all sections of industry desired to be employed 011 the basis of a weekly wage and the Court though 1. the issue shouid be left for consideration when the eonditions of employment in each industry or in each section of industry were 'being separately determined. The Court mentioned incidentaliy that the claims of a workers' organisation in a dispute now under considera tion which covered the furniture trade workers throughout New Zealand did not request a weekly wage for aduii .nale workers. D ealing with that portion of the applieation in which the Court was asked to rnake a new pronouneement -specifying standard rates of wages for skilled and semi-skilled . and unskilieu workers, the Court stated that the last standard wages pronouneement was made pursuant to the powers conlained in the regulations and the minimum rates of wages were fixed as follow:— j Skilled workers: 3s Old per hour. Bemi-skilled workers: 2s 8?,d to Vq 1 1 r 1 ner liour.

Unskilled workers: 2s 7td per hour. It was deelared that these rates were to be increased in a manner and to an extent preseribed by the Court 's general orders of August 9, 19-40, and March 31, 1942. I11 effect the appliearon before the Court was that the tuinimuin hourly rates for. adult male workers should be-: — Skilled workers: 3s Gld per hour. Semi-skilled workers: 3s 24 d to 3s 5d per hour. Unskilled workers: 3s lid per hour. It was inherent in the applieation that the above' rates should be increased in the manner and to the extent , preseribed by the Court 's general orders of 1940 and 19*42. Under the regulations the Court was empowered to make standard wage pronouncements for the purposes of the regulations. In considering the applieation for such a pronouiicement the Court rvas required to have regard to the general .purpose of the regulations and the desirability of so fixing the rates of remuneration as to restore or preserve a proper relatiouship with the rates of remunera- ■ tion of other workers or classes ot workers whether lixed by any award, apprenticeship order or industrial agreement or otherwise. The general purpose of the regulation was to promote the economie stability of New Zealand. The judgment adds: "We find it neeessary to state that although the I'egnlations have been amended reeently in a number of respects, their intention and effect is still to impose restrictions upon the Court in the interests of econoinic stability. In addition, the Court is charged with the / responsiblity of reviewing and approv- _ ing all industrial agreements for the 5 purposes of the regulations. ^ As the rigidity of the regulations has been eased for a time there has been a tendency to request the Court 1,0 place sueh a generous interpretation upon the amendment that if adopted the effect would be the same so far as the restrictions upon the Court are con-'-erned as if the regulations w-ere treated as non-existent. "It is obvious that the Court cannot countenaiice such requests. If it liad been the intention that the Court should no longer be trammelled by regulations then the appropriate clanses would have been repealed. Likewise if it had been considered there were no longer any sound reason why employers and workers should be under restraint when entering into industrial agreements as to rates of remuneration ti 311 the gw Court would havn been reliovecl of

the responsibilities imposed upon it by the regulations. It is a matter for comment, however, that despite the restrictions imposed by the regulations the Court is faced with claims in the present instance of much greater scope and financial magnitude than any others that have ever been submitted to it in the course of its history. "The first question we propose tu sxamine is whether the present standard wage rates as fixed in 1945 requir.: to be varied so as to restore or preserve the proper relationship between tlie said rates and the minimum rates o± wages now being paid to various classes of workers in the Dominion. An examination of the extensive list oi" awards made and industrial agreements approved in the last 12 -inonths discloses a general upward tendency in the minimum wage rates preseribed therein. The amounts of increases vary considerably but the bulk of them fall within the range of from ld to 24cl per hour or from 3s 4d to 8s 4d pei week. Mention was made during the hear ing of decisions or special . tribunals set up under the Strike and Loekoui Emergency Regulations of the decisions of Wages Commissioners undethe Economic Stabilisation Emergenc.v Regulations and to the distnrbing effects of such decisions on the generai wage structure resi^lting in resentmenl and discontent among the ranks of Avorkers. "We do not doubt there is something ,in these contentions," says the Court, "but whilst the matters referred to cannot be entirely ignored we are not disposed to give "them a great deal of weight on arriving at our eonclusions on the present applj'cation. " The question which gave the Court concern, added the judgment, was the extensive manner in which it believed the stabilisation regulations were being ignored by many employers and workers when entering into individual contracts of sorvice. The Court 's grounds for tliis belief were f ounded upon " t)ie impressive volume of eyidenc^ .wfiich had come before it in the -c-6uri8 of"its ordinary work. • The situation was a reflectiou of the present 4abour shortage. It appeared that many enipfoyers were faced with the embarrassing alternatives Of either losing members of their staffs or joining with their workers in committing breaches of the regulations. ' Tim latter alternative was often chosen. The advertisenient- cblumns of the daily press added their mute but convincing testimony as to what. was going on. Wliile"it was true that the enforcement of this section of the law was not connected directly with the work of the Court, nevertheiess in considerinu the present applieation the Couri

was bound to examine the rates of remuneration of all classes of workers. Because of tlie situation referred to, it was probable that today there was a greater margjn betwreen the aetuai average wage rates being paid in induS try and the minimum rates preseribed by awards and industrial agreements than ever before. ' Furtlier, the probable consequence of the recent developments was that the rates of wages of some groups of workers and of certain individual workers who, because of the peculiarities of their industry or occupations or because of their personal circumstances were not in as favourable a jiosition as other workers to exercise bargaining powers, were lagging be hind. If this were occurring, and the Court believed it was, industrial discontent rnust arise and there was no doubt that the Court had some responsibility to watclx the interests of such workers. Another point of interest was that il: the average margin of actual rates over minimum rates was greater than ever before, tlien the impact of the increase in the standard wage rates on ' the Dominion 's economy was likely to. be less marked than usual. The .Court was satisfied that it was neeessary and just that the present standard rates should be increased, but the applicants had failedto convince it either by evidence or by argument that the amount of increase should be as much as 6.3d »per hour. The judgment, after discussing the wartime price index and the weekly wage index, recalled the Government's announcexhent of its intention to withdraw subsidies. A survey of iriternal economy, it said, led to the conclusion that desirable and reasonable adjustments , to the standard wage rates could be L made without embarrassment to inL dustry and without serious infiationj ary effects. It had to be recognised that the increases in the rates of wages which were in operation in a number of in dustries had resulted in raising temporarilv the measure of real wages in those industries while at the same time real, wages in other industries had probably l)een temporarily reduced. It was the responsibility of the Court to endeavour to correct that position. A rapid repetition of the process, however, would jeopardise our economy. Under present eonditions of full. employment and shortage of labour the labour market was a se'ller's market. The bnrgnining stpength of workers'

ofganisations and of individual workers was correspondingiy increased. Employers found that they had to bid for the services of workers, industry against industry ■ and individual employer against individual employer. Private employers as a elass eomplain ed that the State Dgpartments wrere outbidding them for the services or workers -while representatives of . the State Departments alleged that the reverse was the case. It was neeessary to realise that' irresponsible wage bargaining could quite easily lead to inflationary developments. Under the cireumstanees prevailing in the Dominion today it could, theref ore, be seen how very important in onr economy was the work of the Economic Stabilisation Commission and the Price Investigation Tribunal. It was just as neeessary and important as ever to keep inflationary pressures under control if we were to protect real value of wages, the real incomes of primary producers, the real value of our ' socia! seciirity benefits and pensions, and the real value of the hard-won savings of our workers.

"It mnst be recognised, of course, that inflationary -pressure is not by any means internal only in origin. A very serious source of inflationary pressure lies in the 'high and still rising price levels of other countries. Prices in those countries with which we trade directly affeet prices of our exports and imports, and ultimately through their ■ influence on costs affect the pric,es oi all our goods and services." Two. possibilities menaced ecopoiny today: Eirstly, the possibility that the present prices for exports would not be maintained, and secondly, the possibility of what was nowadays eupliemistically referred to as a recession in the United States. A cautious wage poliey such as was envisaged by the stabilisation regulations would undoubtedly assist in 'meeting the diliiculties that would result in the^event of . either 01 both of those happenings.

The Court deelared that the standard wages rates decided upon in the pronouneement would not be 'increased by the- applieation of tbe provisions oi the two general orders of 1940 and 1942, and a similar policy would oe adopted in amending awards and industrial agreements pursuant to the regulations.