The Daily News WEDNESDAY, NOVEMBER 16, 1927. COMPULSORT ARBITRATION.

Taranaki Daily News, 16 November 1927, Page 6

The Daily News WEDNESDAY, NOVEMBER 16, 1927. COMPULSORT ARBITRATION.

Two notable contributions to the discussions in regard to New Zealand’s industrial legislation were made last week. In his capacity as president of the New Zealand Employers’ Federation, the Hon. T. Shailer Weston, M.L.C., made the proposed amendment of the Arbitration laws the subject of his address to the Taranaki Employers’ Association. About the same time there was published in a Wellington newspaper an article by Mr. A. 11. Tooker, Professor of Economies at Canterbury College, dealing with the same matter. It may be said at once that practically the only points upon which the two agree is that all is not well with our machinery for settling industrial disputes, and that the proposed amendments are by no means all that may be desired. Mr. Weston’s speech was that of a strong advocate for the present system of compulsory arbitration, and, indeed, for the maintenance of the Arbitration Court in its present form. Professor Tooker takes the view that the whole system is wrong, and gives cogent reasons for his viewpoint. Mr. Weston claimed that while the present constitution of the Arbitration Court may not be perfect, yet the New Zealand system of compulsory arbitration had been more successful than any other in preventing industrial conflict, wage-earners had benefited, and That as a result of its application a better spirit of co-operation and conciliation between employer and employee is being developed. He went further. He declared that the employers of New Zealand were unanimous in their support of the existing system, and he expressed the opinion that neither farmers nor the dairy industry should be exempted from the scope of the Arbitration Court, lie could sec no good to either employer or wage earner in the proposals to amend the constitution of the Court, and

emphasised the need for cultivating the spirit of conciliation on both sides in all industrial matters. As to the first claims, Professor Tocker points out that the present system has failed to ensure industrial peace. “From 1921 to 1925,” lie says, “6 per cent, of the wage earners in the Dominion, accounted for 90 per cent, of the industrial stoppages. These are the more militant unionists, and some of them do not use the Court at all; others use it or free themselves from it at their convenience.” In other words, where compulsion is most essential if industrial peace is not to be broken, the Court is impotent. Further, the Court’s investigations are most limited. It is used only by trades unionists. Out of 400.000 wage-earners in the Dominion 190,000 are registered unionists, and many of these never approach the Court, lienee the Court investigates at most the conditions affecting about one-fourth of the wageearners. but makes awards which are binding over a much wider field. In other words, “for threefourths of the wage-earners the Court is not used, and not required.” It has not secured industrial peace; it is doubtful whether it appreciably diminishes industrial strife. There is no evidence that it is needed to prevent sweating and exploitation, for there is no indication that these exist. What has happened is that the Court’s minimum wage has become the standard wage. “It fails,” said Professor Tocker, “to recognise human variability, and denies to human capacity the stimulus of differential rates of pay; the Court even penalises payment by results.” Its awards necessitate a mass of regulation ‘.‘which binds industry in a strait jacket, preventing experiments, adjustments and changes, increasing costs and thereby reducing demand and narrowing markets.” Nor can the claim that the wageearner has benefited be supported. In the United States and Canada, where no compulsory arbitration exists, the purchasing power of wages has been increased by about 25 per cent, since 1914. Here the result is very different, and this will continue

so long as we continue to disregard the fact that since wages come out of the product of industry, the limitation of a worker’s product by awards and regulations necessarily limits his earnings also. Were it realised that the greater the product, of labour the higher wages can be, much better results would follow. Moreover, the burden of it all falls ultimately on the unsheltered primary industries. They must sell in the open markets of the world, for them there can be no passing on of the increased costs of production which awards entail. The result is the most serious drift of labour from the farm to the town, and a growing demand for similar artificial .shelter for the farming industry. That the present system has its advocates is undoubted. Some will be those who have vested interests in its maintenance, others will be those conservative minds whose opinions are based on habit, custom, and fear of change. Professor Tocker urges the elimination of the system in its entirety. Mr. Weston is equally emphatic that it should be maintained intact. The Government’s proposal is the middle course of preserving what has proved to some extent useful, and by amending its methods of application. The country is not quite ready for the abolition of the system, however desirable that maybe, and the Government’s proposals may be the most serviceable for the present.