Alternative Law Journal
MICHAEL LYONS and TOMMY KHOSHABA[*]
The High Court challenge by five state governments to the constitutional validity of the Howard government’s ‘Work Choices’ legislation implies a counter-intuitive endorsement of both the theory and governance of federalism by the Australian Labor Party (ALP). By examining the relationship between the ALP and the federal Parliament’s industrial relations law-making powers, this article argues the (failed) litigation of the state ALP governments was consistent with the party’s century-old tradition to expand federal powers to advance the interests of the labour movement and workers generally. While parallels between the Howard government and past ALP efforts to expand federal industrial relations powers can be identified, these similarities are merely superficial as expanded federal powers are only a means to achieving ALP industrial relations policy and are not ends in themselves. The April 2007 industrial relations policy of the ALP National Conference clearly emphasises this factor.
In April 2007 the leader of the federal opposition, Kevin Rudd, rejected a return to state-based industrial relations regulation, stating ‘Federal Labor’s objective … is to create a uniform, national industrial relations system for the private sector’. This policy was endorsed by the ALP 2007 National Conference: ‘A Rudd Labor Government will rely upon all of the Constitutional powers available to it in government to legislate national industrial relations laws’.
In one respect this new policy seems inconsistent with the challenge by state ALP governments to the constitutional validity of the Howard coalition government’s ‘Work Choices’ industrial relations laws in 2006. Yet in another respect this policy is consistent with past efforts by the ALP to expand the coverage and operation of Australia’s federal industrial relations regulation, as the ALP has either in government or opposition sponsored and/or supported eight attempts to widen the industrial relations legislative powers of the federal Parliament. Of these attempts, only the 1946 referendum attracted majority national support, but it failed to be carried because it only received majorities in three states. Craven argues the federal Parliament’s industrial conciliation and arbitration law-making power, section 51(35) of the Australian Constitution, ‘has proved grossly insufficient to meet ambitions of the Commonwealth’, and the defeat of repeated attempts to alter the Constitution by referenda to give the federal Parliament additional powers ‘in respect of industrial relations’ has ‘persuaded the Commonwealth that pursing its aims by democratic referendum is futile’. The use of the corporations power of the Constitution, section 51(20), by the Howard government to expand its regulation of industrial relations, has been endorsed by the High Court of Australia as a valid exercise of Commonwealth law-making powers. This outcome, Craven argues, means that the concept of ‘federalism’ now enjoys ‘the enthusiastic support of neither major political party’ in Australia.
This article examines the attitude of the ALP towards the federal (Commonwealth) Parliament’s industrial relations powers. For most of the twentieth century the party’s policy called for an expansion of federal powers so that its industrial relations policies could be implemented. These efforts were, on each attempt, thwarted by a combination of electoral hostility, party disunity, and opportunistic politics of the non-ALP parties. Electoral hostility towards a centralisation of powers — to the detriment of the states — can be interpreted as a community endorsement of the federal structure of the Constitution. Party disunity can be interpreted as an illustration of ALP pragmatism: when in government, federally, the concept of centralised law-making powers is enthusiastically endorsed, but when in government at the state level, the enthusiasm wanes. The tactics of the non-ALP parties can similarly be interpreted as pragmatism. The analysis suggests, however, that the ALP’s attitude towards the Constitution was, and remains, more complex than simple political pragmatism. This complexity is clearly shown when non-ALP governments seek to expand federal industrial relations powers: in the abstract they should be embraced by the ALP but distrust of how the powers would be used augers for caution, if not direct opposition. While the history of the ALP’s attitude towards an expansion of federal powers has evolved to rely more on flexible interpretation of the existing law-making powers rather than constitutional alteration via referenda, the High Court ’s expansive interpretation of the corporations power in 2006 has largely achieved for the ALP what constitutional referenda could not. It remains to be seen, however, if state ALP governments will endorse a truly national industrial relations system — and not one based on the legal entity of the employer — by referring their law-making powers to the Commonwealth under section 51(37) of the Constitution or enacting complementary legislation.
The members of the first Federal Parliamentary Labor Party (FPLP) caucus understood they were the elected representatives of the labour movement ‘bound in a common purpose to advance the interests of workers’. Frazer suggests that as early as 1908 the FPLP was of the view that the party’s industrial relations policy could only be achieved with expanded federal powers. Soon after World War I the party’s federal policy platform explicitly adopted a ‘unificationist’ plank which called for ‘[u]nlimited legislative powers in Australian affairs to be vested in the Commonwealth Parliament’. While this policy was an assault of the federalist Constitution of 1901, it can also be seen as a response to the opposition to the implementation of ALP policies from undemocratically appointed, or property franchised, upper houses of state Parliaments. This plank in the party platform was removed in 1979, but ‘resonances’ remained until the 1990s.
The ALP government’s 1911 referendum sought to enlarge the legislative powers of the federal Parliament in accordance with the FPLP platform. Non-ALP opposition to the 1911 referendum was mostly based on the threat expanded Commonwealth powers would have on the federal balance of the Constitution. Alfred Deakin, for instance, suggested the ‘federal principle’ would be ‘vitiated once and for all’. The 1911 proposals were not, according to federal Attorney-General Hughes, an attempt to impose ‘unification’ to the detriment of the states, but rather an exercise in democratic principles. Despite this, the ALP government in New South Wales (NSW) campaigned against the proposals partly because it was believed the referendum proposals exceeded the ALP’s federal policy platform, and partly because the powers sought would diminish NSW as a sovereign entity. The tactic of combining all the constitutional alteration proposals in the one single question was partly responsible for their failure to be carried because to reject one proposal meant a rejection of all the proposals. Arguably, resubmitting the defeated 1911 proposals to coincide with the 1913 federal election, but this time as separate questions, contributed to the defeat of the Fisher government, as reluctance to endorse any proposal would induce a reluctance to endorse the return of the Fisher government.
In 1919, the Hughes Nationalist Party government resubmitted essentially the same proposals that had been defeated in the ALP’s 1911 and 1913 referenda, albeit the powers on this occasion were only of a ‘temporary’ character. This placed the ALP in something of a quandary: how could they oppose a referendum that sought to achieve largely the same expansion of federal powers which they had advocated when in government, and which also advanced the party’s unification policy? A special federal conference, nonetheless, resolved to contest the Hughes government’s referendum for the reason that it was a ‘sham and delusion’ because of the temporary nature of the law-making powers.
The Coalition government’s 1926 referendum proposals divided the FPLP as some caucus members considered a centralisation of Commonwealth power to be consistent with the ALP platform, and not all that dissimilar to the ALP’s proposals of 1911 and 1913. Other caucus members, however, considered the Bruce government’s proposals to be a direct attack on trade unions, and thus in opposition to the party’s objectives. Due to this division within the party, the ALP federal executive resolved — influenced by the NSW Lang government — that the party had no official position regarding the referendum proposals and thus allowed party members to campaign as they wished.
The antecedent to the Curtin government’s 1944 ‘fourteen powers’ referendum was the 1942 constitutional convention, where an expansion of federal power was considered necessary as a war-time measure. The federal Attorney-General, Dr H V Evatt, had portrayed the Constitution as a remnant of the ‘horse-and-buggy age of social organisation’. Evatt, however, was not an unconditional unificationist: on the High Court bench in the 1930s he sided with the states in constitutional cases more often than with the Commonwealth, largely for reasons of ‘legislative efficacy’ rather than any theoretical ‘States rights’ perspective. At the 1942 convention, the six state premiers, Evatt and the deputy leader of the federal opposition agreed on the text of legislation which each state Parliament was to pass before the end of January 1943 in order to refer ‘fourteen powers’ to the federal Parliament for a period of five years under section 51(37) of the Constitution. All the state delegates at the 1942 convention agreed to sponsor the proposed bill through their respective parliaments. However, by the federal elections of August 1943, the federal opposition urged the states to renege on the 1942 agreement. Consequently, legislation for the ‘fourteen powers’ referendum was introduced into federal Parliament in February 1944 and passed by both Houses. The defeat of the 1944 referendum is not all that surprising, since the same tactical error of 1911, grouping all the proposals into a singe question, was repeated.
The 1946 attempt by the Chifley government was mostly a resubmission of the 1944 proposal, but offered as separate questions, including the Constitution Alteration (Industrial Employment) Bill 1946. In hindsight, the official publicity for the ‘Yes’ case had a remarkably similar tone to debates regarding the Howard government’s ‘Work Choices’ legislation:
• Australia has developed industrially as a nation and most of its industries cross state boundaries;
• the Commonwealth’s existing powers to regulate industrial employment are limited to conciliation and arbitration for the prevention and settlement of interstate industrial disputes. This illogical division, and these limitations, leads to confusion, uncertainty and delays; and
• the system has prevented the Commonwealth from promoting better industrial relations, wages and working conditions.
However, the suggestion as to how this new federal law-making power would be used distinguishes the 1946 proposal from the Howard government’s argument for a ‘national’ industrial relations system: ‘the existing conciliation and arbitration power and the Arbitration Court will be retained and the activities of the court can be extended’. Likewise, the official ‘No’ case had a remarkably similar tone to the 2005–2006 debates:
• the proposal is a result of pressure applied to the government … to bring an end to the existing arbitration system;
• this proposal seeks to give Canberra complete control over wages and conditions by abolishing the existing system of independent and impartial conciliation and arbitration which has delivered great benefits to trade unions and employers alike; and
• industrial justice is best achieved through the existing impartial process, rather than by politicians making arbitrary decisions.
The mistake of 1911 and 1944 was not repeated, resulting in the social services proposal being carried, and the industrial relations proposal only being narrowly defeated.
In 1953, the newly-elected ALP member of the House of Representatives EG Whitlam looked forward to the Commonwealth assuming responsibility for traditional state areas of activity in line with the party’s unification policy. It was Whitlam’s view that the Constitution (and High Court interpretations specifically) was a barrier to the fulfilment of ALP policy. Nevertheless, the impracticalities of the unification policy were appreciated by Whitlam once FPLP leader, as he was pivotal in modifying the policy in the platform at the 1971 ALP National Conference. The then unification policy stating the party would seek to ‘clothe the Commonwealth Parliament with unlimited powers’ was replaced with a more realistic policy of seeking to grant the federal Parliament with ‘such powers as necessary’ to achieve the party’s platform. 
In light of the revised ALP policy, the Whitlam government’s 1973 referendum seems perplexing. The 1973 prices and incomes proposals were not contained in the party platform and neither mentioned in Whitlam’s 1972 campaign policy speech nor in the Governor-General’s speech opening the new Parliament. Kelly argues that the prices and incomes referendum was ‘a failed Caucus initiative, which damaged the government, forced Whitlam into a series of political contortions and strained ties with the ACTU’. The failure of the 1973 proposals did not however diminish the ALP’s push for a centralisation of federal government activities because, as Whitlam himself has noted, it was felt that his government’s ‘program of reform [was] fully capable of achievement within the Constitution’ and no part of the program ‘was ever invalidated by the High Court’.
In short, the proposed federal power over prices and incomes was justified as a means to control inflation. While the government and particularly Whitlam were vague in nominating exactly how the powers would be used, some specific details were announced. The Whitlam government would use the powers to legislate for women to receive equal pay for work of equal value consistent with International Labour Organization Convention 100, authorise ‘tribunals’ to regulate the incomes of professionals not covered by the federal arbitration system, legislate for periodic wage increases to retain their real value, and expand the authority of the Prices Justification Tribunal. The failure of either question to gain majority electoral support, or indeed be carried in any State, was partly due to almost comical differences between the union movement and the federal government, and tepid support from Whitlam’s ALP colleagues. According to the Sydney Morning Herald, the referendum’s failure was also partly due to the unwillingness of Australians to give any more power to a centralist government or any future federal government.
The 2004 ALP national platform was silent on the matter of enhanced Commonwealth law-making powers and its industrial relations policy recognised the role of state industrial relations systems. Moreover, the platform recognised the historic difficulties in amending the Constitution by referenda unless there is ‘broad support across the political spectrum’ and concedes the role of the High Court is to interpret the Constitution flexibly so that it meets the ‘needs of the day’ rather than ‘relying on any expression of original intent made at the time of Federation’. Given the history of ALP efforts to expand the federal legislative capacity in industrial relations matters, it might be expected that the party would welcome any attempt to expand the coverage and effect of federal industrial relations laws. But on the other hand, opposition from ALP state governments to a widening of federal powers at the expense of state industrial relations systems has historical continuity. To that end the Howard government’s Workplace Relations Amendment (Work Choices) Act 2005 (Cth) has parallels with the Bruce government’s 1926 proposal: in 1926 the ‘dual’ system of federal and state workplace regulation was perceived to be a problem because of overlapping and conflicting awards; the states had refused to yield their industrial relations law-making powers to the Commonwealth; and an expansion of federal power was justified by the growth in national or interstate industries and to overcome the limitations of the arbitration power revealed by High Court decisions. Nevertheless, state ALP governments, branches and parliamentarians were suspicious of the proposal’s capacity to weaken the improvements in employment conditions and worker’s rights achieved with state legislation and industrial awards. And as the proposal directly challenged states’ rights and federalist attitudes, it also incited opposition from non-ALP groupings. Likewise, the Howard government’s 2005 Act is seen even by members of the Liberal Party to be an attack on federalism.
The constitutional validity of the 2005 Act was challenged in the High Court by five ALP state governments: New South Wales, Victoria, Queensland, South Australia and Western Australia. The Queensland government argued, inter alia:
the people of Australia have repeatedly, at referendums, rejected attempts by governments of the Commonwealth to broaden the scope of the corporations power and to confer upon the Commonwealth Parliament a general industrial relations power [and] rejection by that sovereign force [the people of Australia] of proposals to add heads of power to section 51 of the Constitution is a powerful aid in construing the Constitution.
In dismissing the Queensland argument, the majority judgment held the failure of successive referenda to alter sections 51(20) and 51(35) ‘provides no assistance in the resolution of the present matters’. The dissenting judgments were not so dismissive of the importance of referenda results. Justice Kirby, for instance, remarked ‘If amendments that are agreed to are relevant to the meaning of the Constitution, those that have been repeatedly rejected should not be so lightly cast aside as irrelevant’. Justice Callinan also suggested the ‘history of the referenda cannot be ignored’ because this would ‘subvert democratic federalism’ found in the ‘structure and text of the Constitution’. Furthermore, Callinan J noted the parallels between the 1926 referendum and the 2005 Act in that the claimed justifications for each were the need to more effectively manage the national economy and that ‘the future happiness and prosperity of the Australian people were at risk’ if the Commonwealth could not exercise its policy.
Moreover, the response of Prime Minister Howard to the failed challenge has historical parallels to the Whitlam government. The day after the High Court had endorsed the constitutional validity of the ‘Work Choices’ Act, Howard was specifically asked ‘if you have so much faith in the Australian people why didn’t you go to a referendum?’. His response, that ‘we didn’t have a referendum because we didn’t need one, we enacted a law which we believed was constitutional’, was similar to Whitlam’s comments that centralised policy reform is ‘fully capable of achievement within the Constitution’. The High Court’s circuitous approval of an expanded federal industrial relations system should be welcomed by the ALP for it now allows the party to implement its policies with national coverage when it next gains federal government and thus circumvent non-ALP state governments.
For the last 100 years the ALP has pursued something of a contradictory, and at times ‘schizophrenic’, approach to industrial relations and the Constitution. In government federally, the party has sought to expand the reach of the Commonwealth Parliament’s industrial relations laws. During the twentieth century this approach was consistent with the party’s unification platform, and thus it repeatedly sought expansion of federal law-making powers via constitutional alteration referenda. While this philosophy was generally adhered to by the majority of the party, it was not always embraced by state branches and parliamentarians, particularly when the ALP held state government. This ‘schizophrenia’ can be explained by political pragmatism: federal ALP parliamentarians aspired to expand their policy-making influence; and state parliamentarians desired to protect their existing policy-making influence. The divisions within the party over the non-ALP federal government referendum proposals of 1919 and 1926 clearly show how the unificationist philosophy could be moderated by pragmatic considerations.
In analysing the relationship between the ALP and the Constitution, it should be appreciated that expanded federal powers were, and remain, not necessarily an end in themselves but merely a means to an end. The intended outcome of a plenary federal industrial relations power was to implement policies that advanced the interests of the labour movement and workers generally. So when expanded federal powers had the potential to harm these interests, such as the referendum proposals of non-ALP federal governments, opposition from the party and its members can be more easily understood. Expanded federal powers allow for the implementation of ALP industrial relations policies that overcome the undesirable policies of non-ALP state governments and/or hostility from state upper houses. In this context the challenge by ALP state governments to the Howard government’s ‘Work Choices’ legislation can be seen as part of an historic continuity, and not necessarily some latter-day conversion to the ideals of federalism. It is the specifics of the industrial relations system itself, and the rights it confers on working people, rather than the jurisdiction or constitutional means used to achieve the system, which is the primary issue of concern to the party and the labour movement. Consequently, opposition to the Howard government’s ‘Work Choices’ system, from both the FPLP and ALP state governments, can be traced to the origins of the party as a national political organisation. Conversely, it is the federalist philosophies of the Liberal Party of Australia that are compromised by the centralist tendencies of the Howard government generally and by its industrial relations laws in particular.
[*] MICHAEL LYONS works in the Employment Relations Group, School of Management, at the University of Western Sydney.
THOMAS KHOSHABA is a legal consultant and part-time teacher and researcher with the School of Management at the University of Western Sydney.
© Michael Lyons and Tommy Khoshaba
 Kevin Rudd MP, ‘Facing the Future’ Address to the National Press Club, Canberra, 17 April 2007 <www.alp.org.au/download/now/070417_sp_npc.pdf > at 13 May 2007.
 Forward with Fairness. Labor’s plan for fairer and more productive Australian workplaces, ALP National Conference, April 2007 < www.alp.org.au/download/now/fwf_finala.pdf > at 13 May 2007.
 Parliamentary Library <http://www.aph.gov.au/library/handbook/referendums/index.htm> Geoff Airo-Farulla, ‘Labor and the Politics of Constitutional Interpretation’, in Glenn Patmore (ed), The Big Makeover: A New Australian Constitution (2002), 256 note 1.
 Greg Craven, ‘Industrial Relations, the Constitution and Federalism: Facing the Avalanche’  UNSWLawJl 11; (2006) 29 University of New South Wales Law Journal 203, 206–7.
 New South Wales v The Commonwealth (2006) 231 ALR 1;  HCA 52.
 Craven, above n 4, 213.
 See Victoria v Commonwealth (1996) 187 CLR 414. See also Joint Governments, Submission to the Senate Employment, Workplace Relations and Education Legislation Committee Inquiry into the Workplace Relations Amendment (Work Choices) Bill 2005 on behalf of the Governments of New South Wales, Queensland, Western Australia, South Australia, Tasmania, the Australian Capital Territory, and the Northern Territory, 9 November 2005.
 See Hon Peter Durack, ‘The External Affairs Power: What is to be Done?’, in Upholding the Australian Constitution, Volume Two, Proceedings of the Second Conference of the Samuel Griffith Society (1993). See also Andrew Parkin and Geoff Anderson, ‘The Howard Government, Regulatory Federalism and the Transformation of Commonwealth-State Relations’, Paper presented to the Conference on John Howard’s Decade, Australian National University, 3–4 March 2006.
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 Ibid, 87.8–9.
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 Ibid, 120.
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 McMullin, above n 15, 146 and 157.
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 Ibid, 78 note 73.
 Senator Gareth Evans, ‘Herbert Vere Evatt: Australia’s First Internationalist’, 1995 Daniel Mannix Memorial Lecture, 31 August 1995. Griffen-Foley, above n 21, 65.
 E G Whitlam, Speech to the University of Western Sydney Reading Room, 13 June 2002, <http://www.whitlam.org/collection/2002/20020612_letter_passion.html> at 13 May 2007
 McMullin, above n 15, 232.
 Standing Committee on Legal and Constitutional Affairs, Constitutional Change (1997) 86–87.
 Ibid, above n 26, 87.
 Ibid, above n 26, 87.
 McMullin, above n 15, 236.
 Peter Walsh, ‘Labor and the Constitution: Forty Years On’, Samuel Griffith Society Conference Proceedings (1997) 153–163.
 McMullin, above n 15, 290.
 James Curran, The Power of Speech, Australian Prime Ministers Defining the National Image (2004), Chapter Two <http://www.whitlam.org/its_time/19/Speeches.html> .
 R S Parker, ‘Political and Administrative Trends in Australian Federalism’ (1977) 7(3) Publius 35–52, 44.
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 Airo-Farulla, above n 3, 230.
 E G Whitlam, ‘The Case for “YES” ’, The Age (Melbourne), 5 December 1973.
 ‘How Government would Use Powers’, Sydney Morning Herald (Sydney), 7 December 1973, 1.
 ‘No, No: Politics … and the Economy’, Sydney Morning Herald (Sydney), 10 December 1973, 6.
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 Ibid, 269.
 Andrew Frazer, The Federal Conciliation and Arbitration Power: from Cradle to the Grave?, Department of the Parliamentary Library, Research Paper No 15, 2001–02 (2002).
 Liberal Party of Australia, Policy Resolutions carried by Liberal Party Federal Council, 24–26 June 2005.
 New South Wales v Commonwealth  HCA 52; (2006) 231 ALR 1 at 41.
 Ibid at 44, per Gleeson CJ, Gummow, Hayne, Heydon and Crennan JJ.
 Ibid at 126, per Kirby J.
 Ibid at 207 and 236, per Callinan J.
 ‘PM rules out referendum on IR laws’, The Australian (Sydney) 15 November 2006 <http://www.theaustralian.news.com.au/story/0,20867,20762441-601,00.html> at 18 May 2007.
 Airo-Farulla, above n 3, 230.
 Richard Sappey et al, The New Federal Workplace Relations System (2007) 55–7. Rudd, above n 1, 10–12.
 Australian Council of Trade Unions, Industrial Relations Legislation Policy, ACTU Congress, 2006, 7. ABC Television, ‘ALP Pounces on IR Newspoll Results’, The 7.30 Report, 4 January 2007 <http://www.abc.net.au/7.30/content/2006/s1821719.htm> at 13 May 2007.
 Parkin and Anderson, above n 8. Santo Santoro, ‘In Defence of Federalism’ (2005) 1 the conservative 6-13. John Roskam, ‘Federalism and the Liberal Party’, in Samuel Griffith Society Conference Proceedings (2006) 130–33.