Life after statutory individual agreements in the Western Australian mining industry: management strategic choices in response to a changing employment relations regulatory environment

Alex Veen

Research output: ThesisDoctoral Thesis

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Statutory individual agreements (SIAs) were a part of the federal Australian employment relations (ER) regulatory system from 1997 till 2009, when they were removed through the introduction of the Fair Work (FW) Act 2009. The Labor government opted for their removal as it stated that the agreements produced unfair labour market outcomes, and that management had used them to de-unionise operations. Although SIAs were only used by a minority of employers across Australia, they were extensively used by organisations in the Western Australian (WA) mining industry. This industry was one of the most vocal advocates of these individual contracts and vehemently opposed their removal.

This qualitative industry case study research explores what strategic choices management of organisations operating in the WA mining industry made in response to the removal of the SIAs from the federal ER regulatory system, why management made the strategic choices they did, and how these choices as well as the regulatory changes affected their organisations. The data for the project came from semi-structured interviews with mining industry managers and industry experts, as well as analysis of an array of documents (industrial agreements, media releases, public policy documents, etc.).

In this research the strategic choice framework (Kochan, Katz & McKersie 1986) functions as the main theoretical lens through which the findings are analysed, whilst the strategic negotiations framework (Walton, Cutcher-Gershenfeld & McKersie 1994), New Chicago School (NCS) regulation theory (Lessig 1998) and the construct of regulatory space (Hancher & Moran 1989) provide refinements that allow for a more in-depth investigation of specific parts of the strategic choice framework.

It will be shown that management in the WA mining industry initially used the SIAs to establish the organisations’ preferred ER/HR arrangements, these were reflected by substantial levels of managerial prerogative and control as well as no union involvement in the organisations. The preferred workplace relations provided management with significant levels of flexibility, high levels of industrial certainty, and enabled them to quickly respond to operational requirements.

The FW regime forced a changed agreement making process upon organisations. Management, however, wanted to retain their existing workplace relations, therefore the observed strategic choices were aimed at maintaining the status-quo, or as much of it as possible, for as long as they could. In general it was found that management used the regulatory provisions available to them to successfully ensure the continuation of their preferred workplace relations, whereby the transitional legislation in the transitional period (2008-2009) as well as the transitional provisions of the FW Act 2009 played a critical role in enabling management to achieve this. Managements’ strategic choices provided organisations with further time to entrench their existing workplace relations which were partly established through the use of SIAs.

One of the major changes that has materialised in industrial agreement making in the WA mining industry, in relation to those employees who were previously covered by SIAs, was the increase of unions as signatories to the enterprise agreements (EAs) concluded under the FW regime. While unions in some instances participated in the EA negotiations, overall they played a relatively limited role in the majority of instances. Still this is in shrill contrast to the union exclusion that was taking place under the SIAs, thus altering the labour-management social contract. At the same time it was also in stark contrast to the by managements’ predicted outcome of union dominant bargaining under the FW regime.

Contractor organisations, however, had more difficulties in retaining their preferred workplace relations than the mining companies. This was due to a combination of pressures from clients and the short-term nature of the work which precluded the strategic ‘exploitation’ of the regulatory transitional options that enabled the mining companies to lock-in their existing arrangements. Also the contractors’ more extensive reliance on greenfield agreements placed them in a different position to that of the mining companies.

Original languageEnglish
QualificationDoctor of Philosophy
Publication statusUnpublished - 2015


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