§ 222. “Conciliation and Arbitration.”

In the Convention of 1891, when Mr. C. C. Kingston proposed that the Federal Parliament should have the power to establish Courts of Conciliation and Arbitration, having jurisdiction throughout the Commonwealth for the settlement of industrial disputes, he pointed out that the object was to deal with labour conflicts, the ramifications of which might extend beyond the limits of a State. It was proposed to create a Federal tribunal, which would be able to settle such matters more effectually than could be done by State tribunals, under State legislation; but there was no intention to deprive the States of the powers which they possessed to legislate concerning conciliation and arbitration for the settlement of industrial disputes within their respective boundaries The principal objection urged against the proposal was that it would involve an interference with private property and civil rights, and that it would be expedient to leave such questions within the control of the States.

In the Convention of 1898 Mr. Kingston's pioneer proposals with reference to this subject were found of great service. By that time political thought had developed and public sentiment had ripened in the direction indicated by him in 1891. At Adelaide Mr. H. B. Higgins submitted a sub-clause “Industrial disputes extending beyond the limits of a State.”

“I want simply to give the Federal Parliament a power to establish these courts if it thinks fit. Therefore there will have to be an incidental alteration in the judicature part of the Bill, so as to enable the Federal Parliament to create a court for the purpose. It may be said, ‘Leave the industrial disputes to the States;’ but it is well known that these disputes are not confined, in their evils, to any one State. If there is a shipping dispute in Sydney it is sure to be felt in Melbourne; if there is a coal dispute in Newcastle it is sure to be felt at Korumburra. Any one State is unable to cope with the difficulty.” (Mr. H. B. Higgins, Conv. Deb., Adel., p. 782.)

“When first I attempted to deal with it I thought that for the purpose of making any effectual provision on the subject federal legislation was necessary on account of the extent of the disputes which occurred in industrial matters, and upon which local legislation, confined to provincial limits, is not competent to deal. The opinion I affirmed is here borne out by a variety of cases. If you had federal legislation dealing with this matter, you could establish courts which would exercise a wider jurisdiction and command greater respect and confidence than can be hoped for under any system of provincial legislation” (Mr. C. C. Kingston, Conv. Deb., Adel., p. 782.)

The arguments presented in opposition to the proposal were that to interfere with a State, in the settlement of trade disputes, would be an undue and unnecessary intrusion on the local industrial life of a State; that every dispute was complete in itself in each State; that each State would have ample power to settle a dispute arising within it; that it was impossible to conceive a dispute in a State which, in itself, could extend beyond the limits of a State, in such a manner as to establish a formula determining Federal jurisdiction. In reply to this it was said that a dispute beginning in Adelaide might overflow into Western Australia or Victoria, in which case the State law, if any, relating to it would cease, and the Federal law, if any, would begin.

“Yes; but it will be difficult to determine the moment of overflow even if you can determine the point of overflow. We can scarcely say if there is to be a law in each State that the federal law must not differ from some, if not from all, of these. Consequently it will be a curious problem in relation to penalties and observances for those concerned to know the moment when they have passed from under the dominion of the State law to the dominion of the federal law. That is the great difficulty to settle.” (Mr. A. Deakin, Conv. Deb., Adel., p. 784.)

“In one sense it is hard to say that any industrial dispute is a dispute outside the limits of the colony.… It is impossible to say when any dispute extends outside the limits of a colony, because a dispute is always in one colony although it may be going on in every colony. In another sense every dispute extends outside the limits of a colony.” (Mr. B. R. Wise, Conv. Deb., Adel., p. 785.)

The proposed new sub-clause was amended in form, but on a division it was rejected by 22 votes to 10.

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At the Melbourne session, the sub-clause was again proposed by Mr. Higgins, and led to a prolonged debate. Mr. W. McMillan was strongly of opinion that this matter ought to be left absolutely to the States. Sir John Downer contended that it was not a federal question at all. Mr. J. H. Symon thought it unnecessary and mischievous to insert such a power in the Constitution. Mr. Wise did not think that it would be prudent to create a Federal Court, having authority to fix the rate of wages for the whole of Australia. Mr. Isaacs thought that a federal tribunal, in which both sides would have confidence, would avert a national danger that might confront them at any time. Mr. Trenwith pointed out that in consequence of the continually increasing complexity of our industrial system, there was scarcely ever an industrial dispute of any magnitude whose effect did not spread over the borders of two or three, and sometimes of all the colonies. This was notably so in the maritime strike which took place some years ago over the difficulties with the marine officers. That dispute, at some time or other of its existence, extended to every one of the colonies, including New Zealand.

Mr. G. H. Reid believed in the compulsory investigation of trade disputes by State authorities, but he was of opinion that the proposed sub-clause would tend to enlarge the area of trade disputes, for the very reason that the employers or the men might be disposed to extend the area of a dispute, in order to get the advantage of having it settled by the federal tribunal. Sir John Forrest supported the sub-clause, because the Federal Parliament would be better able to deal with the subject, and would deal with it more moderately than the local parliaments were likely to do.

One of the principal objections raised against compulsory arbitration was that there were no means available by which an award, when made, could be specifically enforced. How, it was asked, are you going to enforce an award against a multitude of working men? The answer was found in the scheme of conciliation and arbitration legalized in New Zealand. Under the law of that country the award, when made, is in each case filed in the Supreme Court, and has the force and validity of an award made on an ordinary arbitration. Each party to the award, whether employer or workmen, or unions representing them, can obtain a judge's order exacting a penalty for breach of the award. The penalty fixed does not exceed the sum of £500 in the case of an individual employer or a trade union. Should the funds of a union be insufficient to pay the penalty, each member is liable to the extent of not more than £10. (Review of Reviews, December, 1897, p. 741.) On a division the sub-clause was finally adopted by 22 votes to 19.

51. (xxxvi.) Matters in respect of which this Constitution makes provision until the Parliament otherwise provides223:

HISTORICAL NOTE—This sub-section was added as a drafting amendment at the Melbourne session, before the first report, and was verbally amended after the fourth report.