Small business collective bargaining failure

After 12 months of the operation of the new streamlined authorisation process for collective bargaining by small business, only six notifications have been made. Three were allowed to stand, two were rejected and one remains under consideration.

It’s a weak result from Trade Practices Act amendments that promised to give small businesses bargaining power in industries with large customers, competitors or suppliers.

A lecturer in the Faculty of Law at the University of Sydney, Shae McCrystal, points out in a column published in a national newspaper yesterday that if the ALP is serious about counteracting inequality of bargaining power for small businesses it must revisit the concept of public benefit in the TPA notification process.

She explains that in deciding whether a collective bargaining arrangement is lawful, the Australian Competition and Consumer Commission must weigh the public benefit to be gained from the proposed conduct against the likely competition among members of the collective.

Public benefit means consumer benefit; not any private benefit to be gained by correcting a power imbalance.

She points out that this is incredibly difficult to prove, in part because in the trade practices context the underlying assumption is that all individual operators are equal.

McCrystal argues that the ACCC should at least include, in its consideration of public benefit, consideration of the private welfare of the members of the bargaining unit.