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Labor As Seen from Down Under: Fair Wages and Decent Benefits Profit Everyone

Friday, 29 November 2013 01:16 By Niall McLaren, Truthout | Op-Ed
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Australian money(Image: Australian money via Shutterstock)Proverbs 14:23. In all toil, there is profit . . . (and then there was McDonalds).

Why do waiters need to eat?

When we were visiting my son in Boston at Christmas, he had to keep reminding me to tip waiters. I couldn't see why it was necessary. Here, in the upside world of Down Under, we pay our waiters a wage but, in Boston as in the rest of the US of A, it seems they don't actually pay waiters. Remarkable. His university friends, he said, who were working in the restaurant we were patronizing, were granted the sum of $2.13 per hour by the owners to wait on their tables. If they wanted more, they had to wring it from the patrons. I appreciated the artful thinking behind this move, but if an employer tried to pull that stunt in this country, he'd be in serious trouble. And rightly so. Waitpersons, kitchenhands and other lowlife actually have to eat, and pay rent, and travel to work - and pay for medicines, or schools . . . In fact, waiters etc. don't get a free ride anywhere that I've seen. Perhaps the crafty restaurateur had also read Proverbs 12:24: The hand of the diligent will rule, while the slothful will be put to forced labor.

I see where workers at Walmart are paid an average of $24,000 a year, and need government subsidies to live (that figure is artificially inflated by including managers, as ordinary workers struggle to earn $17,000). Meanwhile, Walmart's owners blissfully wallow in torrents of money they couldn't possibly spend in a hundred lifetimes ($115 billion as of March 2013). To my simplistic way of thinking, this means the US government is subsidizing the Walton family to the tune of about $1 billion a year. I hope they pay their taxes in gratitude. The enterprising Mr Bezos, of Amazon fame, pays his workers about the same, but makes them wait in line to be frisked after their twelve-hour shifts - on their own time. Well-paid workers don't normally steal because they don't want to lose their jobs, and they also tend to respect generous employers more than tightwads. Look no further than Ephesians 4:28: Let the thief no longer steal, but rather let him labor, doing honest work with his own hands, so that he may have something to share with anyone in need.

For us, the envious foreigners who don't live in Godzone, it is a total mystery why anybody would want to crush his workers into the dirt by depriving them of a profit to their toil. I'm an employer. If I knew my workers couldn't afford to pay their children's school fees, I wouldn't be able to look them in the face. What drives US companies to pay their CEOs 354 times an average worker's wage when, 60 years ago, CEOs were satisfied with only 20 times as much? A few years ago, the CEO of Caterpillar Corporation was asked by his production line workers why they hadn't received a pay raise for 10 years whereas the firm's senior executives were getting more and more every year. The CEO replied that the company had to pay internationally competitive salaries for its top executives. At the time, the CEO of Kubota, the only competitor for Caterpillar, was earning one-tenth of the Caterpillar CEO's $22.7 million annual take.

Fair Wages and a Civil Society

Salaries here in the workers' paradise have long been controlled by the government for the purpose of making sure that workers received adequate profit for their toil. It goes back a long way, almost to the time of Federation, in 1901. One of the earliest moves of the new government of the infant Commonwealth of Australia was to establish a legal basis for ensuring industrial peace and stability through a Federal Court of Conciliation and Arbitration. Unlike another federal court that's been in the news lately that prefers to remain hidden, this was a fully-functioning, adversarial court in which justice was done and was seen to be done. Anybody could bring a case against an employer and, in 1907, some unhappy workers did just that. They were not being paid a proper wage, as the law demanded, and the court found in their favor: Every employer, the judge ruled, was required to pay his workers a wage commensurate with ". . . the normal needs of an average employee, regarded as a human being in a civilized community." However, the killer point (from the owner's point of view) was this: it had to be paid regardless of the owner's capacity to pay. Crying poor didn't work (note that, Mr Bezos). The Harvester Judgement, as it was known, has shaped the industrial landscape of this country to the present; we do not accept that grinding workers into the dirt to save a few extra dollars is the action of a reasonable human being in a civilized country. We have a much higher minimum wage than the United States, and our unemployment rate is far lower. We do not have, and would not tolerate, a permanent underclass of disempowered workers on starvation wages.

The old Industrial Court has since been replaced by an Industrial Commission, but it functions much the same. Thus, we pay the people who sling hash a livable wage, well over twice the US minimum wage. At the click of a mouse on this site, workers can find their salaries and conditions because every type of work is covered by an enforceable award, governed by the Fair Work Commission. Everybody has to be paid a reasonable wage, determined by a judicial body, and all conditions of work are set out in enormous detail. Full-time workers in the fast food industry get about $17.50 an hour, as well as two weeks cumulative sick leave a year, four weeks annual leave plus public holidays, employer contributions to their pensions equivalent to 9 percent of their salaries (soon to rise to 12 percent), generous overtime rates, and are protected against unfair dismissal or any improper behavior by any person on the work site. Discriminatory behavior of any sort is subject to severe legal sanctions, all of which adds to an idea of a (perhaps imperfect) "civilized community." Casual employees generally don't get all those benefits, but they get more in their pay packets to make up for it. To top it off, if a worker loses his job, he is entitled to long-term unemployment benefits, currently $248.50 per week for a single person (the rates are here; scroll down to Payment Rates for Newstart Allowance). Retraining and vocational education grants are also available.

Our trade unions have always been much more powerful than in the United States, not least because they represent workers before the Industrial Commission and because they have made industrial safety one of their major functions. It is an offense for an employer to prevent his workers from joining a union, and unions have guaranteed access to worksites. There have been strikes where a worker didn't want to join a union. Historically, we have had industry-wide strikes at different times, including shearers, stevedores, transport and construction workers, and coalminers, but those days are long gone, and workers in those industries now have generous conditions.

What Does a Psychiatrist Earn?

So what does this mean in economic terms? Surely our struggling business owners must be on the brink of bankruptcy supporting their slothful and grossly overpaid workers? Well, no, they aren't. McDonalds franchisees just about have a license to print money. Sure, there are restaurants here that struggle; there are even restaurants that close, but that happens everywhere: It's a highly competitive industry. Aha, you say, prices in Aussie hash houses must be off the planet, that's how those poor, downtrodden owners survive. No, not at all. At present, a Big Mac here in Brisbane costs AU $4.95, about US $4.60, compared with US $4.20 in Boston, so paying generous wages to staff adds about 10 percent to the cost of a meal (and no need to tip). That's not a lot to pay to know that your waitpersons don't have to sell their children into slavery to survive.

In general, workers here are paid far more than in the United States. Check the award finder site above, and find out what nurses are paid, electricians, greenskeepers, teachers and so on. If you want to know what I earn as a psychiatrist, go here to Medicare and type in psychiatry. Rebates are set out in full detail for all to see. I can make a good living without breaking my back or cheating the patients or insurers (as for cheating Medicare, don't even think it; they are not of a forgiving nature, but it isn't necessary as they pay a comfortable rebate). Yes, the cost of living is higher here. Clothes are definitely more expensive here, but quality rags cost about the same. Travel is more expensive, plus the fact that we have further to go to get anywhere, but airports here are clean and quiet. Taxis are more expensive, but not so bad when you realize you don't have to tip the driver. My family did a "celebrity tour" in Hollywood at Christmas, and couldn't get off the bus until they had handed over a sizable tip for the driver - who wasn't paid by the owners.

Restaurants are about 30 percent more expensive here, but we eat at home much more. New cars cost about 50 percent  more, but our roads are jammed every rush hour. Petrol costs about $6 a US gallon, a lot of which pays for high-quality roads. Total taxes are a little higher (you have so many different taxes), and most insurance is a bit more, but what we lose on the swings, we gain on the roundabout. Health care here is essentially free for anybody who needs it. The wealthy pay a bit more, but nowhere near what their peers in the United States pay. And education here costs very little. I've talked about that in another article but when my son said he needed to go to the United States to do the course he wanted and here's the fee; it took me a week to recover.

Fair Wages are a Win-Win

So paying workers a decent salary, consistent with the idea of a civilized nation, is not financial suicide, it's actually a good investment. People who say otherwise are just spreading false propaganda (aka lying). Everybody knows that well-paid workers in secure jobs work better, take less time off, have fewer accidents, don't change jobs as much, don't steal or damage as much stuff, and the job gets done with less hostility. I'm not saying our bosses and workers are always the best of mates, but we don't have anything like the vicious animosity seen in the United States. Remember that the Harvester Judgement was seven years before the infamous Ludlow Massacre in the United States. When we were worrying about how to define civilization in the workplace, US bosses were calmly murdering their workers to stop them getting even a half-decent salary.

A civil society can be done, all it takes is a bit of generosity and concern for one's fellow citizens as has been known for about 3,000 years. Proverbs 31:8-9 says it all: Speak up for those who cannot speak for themselves, for the rights of all who are destitute. Speak up and judge fairly; defend the rights of the poor and needy.

But paying waiters $2.13 an hour? No, I'd gag on that.

Copyright, Truthout. May not be reprinted without permission.

Niall McLaren

Niall McLaren is an Australian psychiatrist, author and critic, although not necessarily in that order.


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