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Mccann, David --- "First Head Revisited: A Single Industrial Relations System under the Trade and Commerce Power" [2004] SydLawRw 5; (2004) 26(1) Sydney Law Review 75


First Head Revisited:

A Single Industrial Relations System under the Trade and Commerce Power

DAVID MCCANN[*]

Abstract

The reach of Commonwealth regulation in the industrial sphere has traditionally been constrained by the narrow grant of industrial power in s51(xxxv) of the Constitution. That power allows only for the resolution of interstate disputes by conciliation and arbitration. Increasingly the Commonwealth has sought to extend the applicability and content of its industrial systems by using its other s51 powers. The result with which the Australian industrial system must now cope is a complex hotchpotch of overlapping federal and state mechanisms. This paper argues that the Commonwealth could achieve both broad applicability of its laws, and significant policy-making flexibility, by enacting unitary industrial legislation in pursuance of its s51(i) power to legislate with respect to ‘trade and commerce with foreign nations and among the States’. This power has long been overlooked, despite United States jurisprudence underlying a broad construction. A reconsideration of the untenably narrow understanding of commerce, trenchantly maintained by the Australian cases, is timely given the globalisation of the labour market and the revitalised jurisprudence upon the s92 guarantee of freedom of trade. Commonwealth systems freed from the confines of s51(xxxv) and the complexity caused by reliance on other powers will portend a radical change in the way we conceive of labour relations regulation in this country. The future could be very different under a national industrial relations system based upon the first head.

Introduction

The ‘encumbrances essential to reliance on the Constitution’s industrial power’ have, for most of our nation’s history, severely restricted the utility, efficiency and efficacy of industrial law and policy in Australia. From the earliest possible point in our nation’s history,[1] the Commonwealth has sought to increase its policy choice and the coverage of its industrial systems beyond the strictures of the limited, purposive s51(xxxv).[2] Six failed referenda,[3] one lone referral[4] and a patchwork of provisions under other s51 powers have been the unsatisfactory results.

I argue in this paper that the oft forgotten trade and commerce power is potentially the most helpful power available to the Commonwealth should it seek to legislate for a unitary national industrial relations system.

I assess in Part 1 the features and costs of the present farrago. Dual (state and federal) jurisdictions often overlap. The Commonwealth’s power under s51(xxxv) is exercisable only where there is an interstate industrial dispute, which in turn must be resolved only through a system of conciliation and arbitration. I briefly describe the inefficiencies and uncertainties created by this overlap. A single national scheme of employment standards and dispute resolution mechanisms, administered by the Commonwealth, is presented as the benchmark in this analysis. The comparison indicates the complexity, expense and unfairness that unnecessarily characterise the current system. These impediments result primarily from the narrow terms of the grant of industrial power under s51(xxxv), which still underlies the bulk of federal industrial legislation.

Assessments of the ‘failings’ of the current shared system have been repeatedly made elsewhere.[5] On the other hand, it may well be that in the present political context a shift to a Commonwealth system would eviscerate desirable rights. It could also preclude the policy dynamism that comes with our competitive federalism. My analysis, however, deliberately eschews an overtly political comparison of the existing model and a unitary arrangement. Nor do I examine the entrenched practical and political difficulties that any government would face in trying to push through such a change. This paper instead concentrates on the constitutional contortions presently required and the legal basis for a renewed federal power.

Part 2 turns to alternative solutions. Labour regulation must now respond to a continuously changing workforce[6] and an employment market that is migratory and essentially national.[7] We can thus expect federal governments in the new millennium to prefer those powers which will provide two touchstones: first, comprehensive coverage, and second, policy design flexibility. Against these familiar criteria, I examine a range of constitutional powers and their capacity to effectively support a broad unitary system.

I then explain why a reconsideration of the trade and commerce power, in particular, is timely. Many commentators have noted that s51(i) has a large degree of unexplored potential.[8] This is especially the case given the High Court has now clarified the meaning of s92 (the guarantee of free interstate trade and commerce),[9] which had previously constrained a broad or plain meaning interpretation of its related power.

In Part 3, I describe the broad interpretation of the commerce clause in the United States Constitution, a clause substantially the same as s51(i). In the US, comprehensive federal labour legislation is based upon this broadly understood clause; it thus provides a useful comparator and model for Australia.

With the United States model in mind, I discuss in Part 4 the traditional interpretation of the Australian trade and commerce power. The High Court’s narrow approach to the power is difficult to sustain theoretically and presents a technical account of commerce that is increasingly incompatible with a modern national economy. I argue that s51(i) is instead properly construed as granting to the Commonwealth a general power to legislate with regard to interstate and certain intrastate commerce. If labour is then characterised as a part of (or affecting) this ‘broad commerce’ then a unitary industrial relations framework, with wide coverage and a high degree of policy flexibility, will be possible under the commerce power. I then briefly indicate the potential for Australian labour law under a newly understood trade and commerce power.

1. The Current Australian Industrial System: Features and Costs

Six different industrial jurisdictions continues to make as much sense as having different rail gauges in different states.[10]

For the purposes of the following analysis, ‘a unitary industrial system’ is best understood as an arrangement whereby a single level of government has exclusive power to set standards and regulate relationships in the industrial sphere.[11] It would preferably involve a single set of accessible Commonwealth laws, a national system of tribunals and a sole administering government. Industrial law-making power in Australia is, instead, divided between six overlapping polities.[12] Our unique federal model, enshrined in a stubbornly change-resistant Constitution, involves compromise and duplication in labour market regulation on an almost unprecedented scale.[13] Control over the standards and ‘default rules’ in employment relationships is shared. Concurrent, competing jurisdiction is the norm.

This obligatory sharing is due primarily to the limited nature of the Commonwealth’s industrial power:

Section 51. The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: ... (xxxv) conciliation and arbitration for the prevention and settlement of industrial disputes extending beyond the limits of any one State.

The grant is thus limited in two quite perpendicular ways. First, the Commonwealth has power only when there is a dispute, and can only legislate to solve that dispute in certain constitutionally-defined ways.[14] Second, the dispute must be interstate before the Commonwealth’s jurisdictional competence is triggered; the States’ power, though subordinate in the event of inconsistency,[15] is not excluded per se. Here I examine the consequences of, first, the State/Commonwealth duplication, and second, the restricted manner in which the Commonwealth may legislate under s51(xxxv).

A. Dual Track System

The Australian industrial ‘system’ is essentially two parallel systems, federal and state. Both are made up of tribunals, parliaments, government departments, industrial Acts, and so on. Duplication and resource waste is, to some extent, a predictable result when similar types of institutions are doing similar work in similar ways. Efficiencies of scale are unavailable. Each tribunal, for example, must maintain its own registry and conduct its own procedures. The additional costs are often borne by taxpayers, or by participants in the form of less effective service.[16]

Dual systems, especially dual dispute resolution tracks, also portend inconsistency and inequity in result: it is more likely that there will be unequal treatment of like disputants in different jurisdictions. ‘Rival shops’ enable forum-shopping and the associated uncertainty causes further inefficiency and unfairness.[17] Dual federalism also causes certain problems specific to the industrial sphere: delays in flow-on of award changes,[18] union demarcation and registration disputes,[19] and uncertainty over s109 inconsistency as it applies to awards.[20]

All these problems have been somewhat minimised by inter-tribunal and inter-governmental cooperation, by mutual recognition of precedents and practice, and by parallel legislative action. To take one example, the NSW Industrial Relations Commission recently ‘passed on’ the increase in the Australian Industrial Relations Commission’s national wage case decision, albeit with a significant delay and to workers who could just as well have benefited from the original decision had they been covered. Institutionally, governments often cooperate by dual appointments mechanisms and other comity provisions; the former NSW Coal Tribunal is perhaps the most illustrative example in this area. Initiatives and work at the Council of Australian Governments, by the Australian judiciary, and in universities, have enhanced the effectiveness of this information-sharing and constructive comparison.

Some competitive federalism theorists argue that six systems each striving for best practice will lead to a more dynamic reforming environment and thus to better outcomes in the long run.[21] On the other hand, six poorly resourced and administratively burdened systems, each struggling to maintain national coherency in policy and practice, may merely exhibit a drag effect on economic performance and the achievement of workers’ rights.[22]

B. The Exigencies of s51(xxxv)

The legislative and institutional contortions demanded by reliance on the conciliation and arbitration power have now become established features of the Australian industrial landscape. Commonwealth industrial legislation is limited in its ends and its means: laws must be for a system of dispute settlement[23] through conciliation and arbitration.[24]

Primarily, the Commonwealth cannot use s51(xxxv) to directly regulate industrial relationships or to directly mandate rights and obligations.[25] For example, s51(xxxv) could not support a general minimum wage.[26] Rather, access to the federal industrial jurisdiction requires parties to create a dispute. The logs of claim served in such disputes then confine the subsequent arbitration to the ‘ambit’ of the original dispute.[27] This ‘ambit doctrine’ often results in expansive initial claims so as to secure maximum flexibility and minimise later costs.

Further, only parties to the dispute are bound by the award or decisions made.[28] This creates the constant need to ‘rope in’ new parties, and precludes common rule awards[29] that could delineate the rights and obligations of all parties more equally and clearly. As noted above, the dispute must be interstate. Artificial ‘paper disputes’, bringing in unrelated but interstate employers and peripheral employment issues, are perhaps the most egregious illustration of the administrative hula-hoops that are required.[30]

There are two caveats to this caustic analysis. First, I note the currently underutilised and unexplored ‘prevention’ aspect of the power;[31] this may allow common rule awards, for example, though it would probably still require at least a potential dispute. Second, the Workplace Relations Act 1996 (Cth) (hereinafter WR Act) is of course no longer tied exclusively to the industrial power. Indeed, part of the complexity and overlap I have described results from the Commonwealth’s use of other powers, such as external affairs and corporations, which are less prescriptive but cover only limited participants.[32]

Notwithstanding this, however, the constitutional exigencies of s51(xxxv) cause complexity, cost and lack of coverage[33] far beyond that which we might expect under a simple unitary system. The jurisprudence upon the power is nevertheless a mature one. There seems little chance that the judicial interpretation could (or should) be unshackled from the clear terms of what is, at base, a limited, purposive and not plenary power. Despite some inkling in recent decisions,[34] it appears unlikely that the Commonwealth could successfully advance a significantly wider view in the High Court.

C. Some Conclusions on the Status Quo

The Australian industrial system is thus conceptually, legally and procedurally complicated and costly.[35] This lack of simplicity produces inaccessibility. There is the potential for experienced repeat players (often ‘third party’ unions and employer organisations), and the well resourced, to dominate these processes or cultivate complexity to cement their own advantage.[36] This in turn excludes the voices of small, poor and unsure participants, most especially employees and some small business employers.

These problems of overlap, duality and cost have often been explored.[37] Their depth and intractability is also indicated by the range of governmental action taken in response. Most obviously, cooperation at an administrative and tribunal level has become a necessary reality.[38] Federal and State comity provisions[39] are extensive.[40] The very fact that the Commonwealth has so often gone beyond the specific industrial power in s51(xxxv)[41] indicates the unsatisfactory nature of that grant.

It is important to note, however, that complete Commonwealth control will not necessarily bring with it simplicity. Nor will it necessarily enhance the relative power of workers, or improve the conditions in which they work.[42] Certain advantages may also be lost under a centralist, unitary federal system: local, on-the-ground dispute resolution may become less flexible and less responsive for example.[43] The dynamic policy improvement that can come from competitive federalism would also be pre-empted — reform would no longer be impelled by the successes of ‘the State next door’.

While I do not here come to a conclusion on the desirability of de- or re-regulation of the Australian labour market,[44] it is the purpose of this paper to explain how Commonwealth legislative capacity may increase upon a reassertion of jurisdiction under s51(1) to opportunities that may open up upon a reassertion of Commonwealth legislative capacity. I have noted above the benefits possible under a unitary system. If the Commonwealth wishes to capture these benefits, it must increasingly look to enlarge its power, if necessary at the expense of the States. I have explained why the deliberately constrained grant in s51(xxxv) requires overly complex and inefficient national industrial legislation. I turn now to examine other heads of power that may potentially be used to expand the Commonwealth’s constitutional competency.

2. Constitutional Heads of Power

A. The Trade and Commerce Power

Given the limitations described above, this section now examines the Commonwealth’s options under several other s51 Constitutional powers. The ‘corporations’ and ‘external affairs’ powers, in particular, have been utilised in the past by a Commonwealth eager to influence the industrial landscape. This article focuses, instead, upon the oft forgotten trade and commerce power. This power could be used to supplement or simplify the jurisdiction asserted under other s51 powers. A new consideration of this first head is warranted for three major reasons.

First, I think the limits upon legislative power with regard to trade and commerce previously set by the High Court are incorrect. This is especially so given the increasing globalising pressures to which Australia is subject. Using a detailed comparative analysis, I hope to show that this power is better understood as sufficiently broad that it could ground a unitary industrial relations system.[45]

Second, this power provides an effective, if not the most effective, way for the Commonwealth to implement a system that covers both a wide range of workplace issues (policy flexibility) and a large percentage of Australian workers (coverage). Although it is clear that a referral of power to the Commonwealth[46] or a Constitutional amendment[47]would each have conclusive effectiveness, neither referral nor amendment is likely.[48] Other options have been widely canvassed, the most notable of these being a constitutional corporations-based regime.[49] Although industrial legislation based on the external affairs, territories, corporations, or combinations of these and other powers has been validly enacted in the past, there are limitations in both the coverage and policy flexibility available under these heads.[50] For a variety of reasons, progress on reform toward these alternative models seems to have stalled.

And thirdly, contemporary exploration of the potential of s51(i) in regard to Commonwealth industrial regulation is sparse. Despite judicial indication of this potential,[51] a recently enriched and clarified jurisprudence on s92 interstate commerce,[52] and an increasingly professed desire for simplicity and efficiency in the Australian industrial context,[53] few have yet delved into the latent capacity of this head of power.[54] Most labour lawyers do no more than briefly acknowledge the possibilities under s51(i).[55] It seems that a comprehensive reconsideration of the power is both necessary and overdue.

To chart the constitutional ground, I begin in the next section with a consideration of the more popular (and more familiar) elements of the s51 scheme.

B. The Options under other Powers

(i) A Preliminary Matter: Will the Existence of s51(xxxv) Restrict the Use of Other Powers to Regulate Industrial Matters?

It might seem strange and somewhat illicit to seek to avoid the strictures of the industrial power by relying on other powers like external affairs or quarantine. The simple answer to this is that the High Court has, in most circumstances, refused to restrict the meaning of one power because of the existence of another power.[56] ‘Secondary’ powers, such as the corporations and external affairs powers, have been widely and validly used in the industrial field in the past.[57]

During the darkest days of World War Two, the High Court in Pidoto v Victoria[58] questioned whether the defence power, when used for industrial legislation, would be limited by the requirements of s51(xxxv) (requiring, for example, that disputes be interstate). The court held that the limits in s51(xxxv) were expressed not ‘by way of exception, but by way of definitional circumscription of an affirmative grant.’[59] Section 51(xiii) on the other hand, which gives the Commonwealth power with respect to ‘Banking, other than State banking’, positively quarantines certain matters (State banking) from the reach of all Commonwealth legislation, even legislation that would otherwise be valid under another power. It is enough here to note that Pidoto stands for the proposition that the s51(xxxv) ‘conditions’ will not restrict legislative capacity under other powers.[60]

The Commonwealth’s constitutional power may also be used to achieve, indirectly, objects that seem to be outside the areas it can regulate directly.[61] For example, intrastate trade can be regulated using the corporations power,[62] and some of the affairs of non-constitutional corporations can be regulated under the trade and commerce power. It is not correct to first seek the best characterisation of the law, and then try to fit that law within the constitutional power which most closely meets that characterisation. That would be to invert the proper and logical order of reasoning.[63] Rather, the question is whether the law can be fairly described as a law with respect to one of the s51 heads.[64] And to answer that question, first the powers themselves must be interpreted and understood. In regard to labour law, the general rule has been posited most definitely as follows: ‘A law with respect to overseas trade and commerce is a valid law and does not cease to be valid because it can also be characterised as a law with respect to employment’.[65]

(ii) Section 51(xxix): The External Affairs Power

The external affairs power in s51(xxix) of the Constitution gives the Commonwealth the power to implement international treaties (and some Recommendations) through legislation, so long as such legislation is ‘reasonably capable of being considered appropriate and adapted to implementing the convention’.[66] The Industrial Relations Reform Act 1993 (Cth) was the most significant importation of international labour norms into the Australian industrial landscape to date.[67] It appears that the Act was quite deliberately drafted to qualify as ‘implementing legislation’; and indeed the national, unitary employment standards it introduced have, for the most part, withstood constitutional challenge.[68] The Commonwealth was able to directly impose obligations on employers with respect to termination of employment,[69] discrimination,[70] and family leave,[71] for example.[72]

It is necessary to consider two matters in relation to external affairs that are relevant to the broader argument here. First, the Commonwealth has already begun to outline a national, unitary set of employment standards. It has done so not using the industrial power, nor by amendment or referral; instead it has taken an indirect route using another seemingly unrelated head of power. The High Court has endorsed these impositions, even despite the indirectness, by interpreting a power of the Commonwealth in a broad and coherent manner. The implication for s51(i) is clear.

Second, it appears from the tests (as primarily developed in the Tasmanian Dam Case,[73] Chu Kheng Lim,[74] and the Industrial Relations Act Case[75] ) that an external affairs-based system would be limited in the substantive standards and processes it could establish; policy flexibility may be constrained. Under the ‘proportionality test’ quoted above,[76] Commonwealth regulation must conform relatively strictly to the underlying international standard. For example, if the Commonwealth wished to eliminate the right to strike, it would be difficult to find a treaty mandating that elimination, and still more difficult to eliminate the right and still be ‘appropriately implementing’ a treaty that ensured the right to strike. Similarly, broad and imprecise treaty standards,[77] or partial implementation of a treaty,[78] may cause the Commonwealth regime to fall foul of the validity test for want of ‘appropriateness of implementation’.

Reliance on this power thus shifts influence to the ILO,[79] and probably reduces the range of policy alternatives available to the federal government. However, selective and innovative use of the raft of ratifiable instruments, and their ambiguities, could give even the deregulator a platter of ‘implementation’ options. Of course, at the present time, the obstacles to greater use of the external affairs power are far more political than legal.

It should be concluded, then, that a Commonwealth regime based on s51(xxix), as presently interpreted, would not provide the legislative flexibility of the more substantively plenary powers, such as ss51(xx) and 51(i). Nor would a scheme based, in essence, on implementation of often complex, rights-based ILO instruments facilitate a programme of labour market deregulation (cf (re)regulation). Although the Commonwealth could potentially bind every employer and employee (coverage would be high), as indeed it has done,[80] the sacrifice would be less freedom and flexibility for federal policy makers.

(iii) Section 51(xx): The Corporations Power

The Corporations power[81] is typologically different to the external affairs power: it is defined by reference not to certain matters, but rather to particular commercial entities.[82] The power thus conferred has been described as plenary where trading, financial or foreign corporations are concerned. In other words, s51(xx) gives the Commonwealth a power which extends to the control and regulations of all activities and relationships of these ‘constitutional corporations’.[83]

The most recent series of Liberal-National governments has advocated greater reliance upon the corporations power for the purpose of simplifying and nationalising industrial regulation.[84] The relatively large number of employees that would fall within the reach of a corporations-based scheme (coverage),[85] along with the almost unconstrained ability to regulate where a corporation is concerned (policy flexibility), makes this power attractive on both criteria.[86]

Legislation with respect to the ‘activities, functions, relationships, and business’ of a foreign, trading or financial corporation will presumptively be within Commonwealth power.[87] Industrial relations at corporate enterprises would almost certainly fall within this class of regulatable subject matter:[88] employees have a relationship with corporate employers; the functions of a corporation include employment of staff; and (most interestingly in considering s51(i)) the ‘business’ of a corporation extends to the engagement and marshalling of its workforce. Indeed, the corporations power currently validly grounds, for example, Part VIB Div 3 of the WR Act, dealing with enterprise flexibility agreements.[89] It may be the case that a labour regime would need to have a specific or differential application to corporations (as opposed to other employers),[90] though the courts have generally been willing to construe even broadly expressed applicability provisions as giving the regime the required specificity of application.

As will be seen below, the latitude the court has given the Parliament in how it regulates corporations should be expected to carry over to any new understanding of how trade and commerce (and therefore industrial relations) may be regulated. If the legislation operates upon a constitutional corporation, no further test of purpose or pre-dominant operation or any other requirement will be imposed.[91]

This said, a corporations power-based scheme would have two main disadvantages. First, it could only apply to (foreign, trading and financial) corporations, and so only to a portion of the total number of employers. Even though the proportion of employees covered by federal jurisdiction could rise to 85 per cent of non-farm employees,[92] at least 15 per cent would remain in state systems or outside both systems. By definition then, the Commonwealth could never cover the field using this power. As I will show below, the trade and commerce power, if properly interpreted, should extend to at least this number of employees, for the vast majority of foreign, trading and financial corporations will be engaged in ‘constitutional commerce’ when that term is realistically understood.

Second, many of those most in need of labour rights and protections would be systematically excluded from a regime of this type. Outworkers, partnerships and independent contractors, for example, will often be working for non-corporate entities, and a sufficiently close connexion to a constitutional corporation will not always be easy to find.[93]

Though it is beyond the scope of this paper to determine whether an exclusively s51(i)-based scheme would have statistically broader coverage than an exclusively s51(xx)-based scheme, it is sufficient to note that s51(i) would enable more labour relationships to be brought within the scope of a Commonwealth regime, as it would cover most, if not all, constitutional corporations as well as non-corporate, yet commercial, entities.[94] The policy flexibility allowed under the two would be comparable. Of course, if used together, the trade and commerce and corporations grants could perhaps give the Commonwealth its broadest power. There is no reason at law why an industrial regime could not be expressed to operate on corporations and on those in trade and commerce. Indeed, a catch-all such as this is the most prudent legislative policy going forward.

(iv) Other Powers

Innovative use of certain of the Commonwealth’s other powers might also be made, though most of these options involve certain policy rigidities or limited employee coverage. The taxation power could be used to encourage employers or employees to subject themselves to a Commonwealth industrial relations framework, by imposing additional tax burdens upon non-compliers. This power was used to require certain training expenditures by employers in the Training Guarantee Act 1990 (Cth),[95] which was held to be a valid piece of ‘taxation’ legislation despite its overriding ‘industrial’ purpose.[96] The tax burden mechanism is, however, administratively cumbersome, costly, and again would be a top–down regulatory scheme, rather than a scheme based around employees’ rights.[97]

There is a range of other powers that could extend the coverage of a Commonwealth scheme at the margins.[98] Undoubtedly quarantine, postal, telecommunications, customs, lighthouse, and some other specific occupational classes of employees would be bound by a Commonwealth scheme if it were specifically extended to them[99] (and perhaps if not).[100] Similarly, the Constitution gives the national Parliament power over the Commonwealth public service,[101] defence employees,[102] and all employees working in or affecting a territory.[103] These grants are arguably plenary as against the relevant class of worker, though of course the relevant classes are limited in membership.

Thus, in the current deregulatory climate, as the Commonwealth seeks to oust State systems in favour of a single flexible system with broad coverage, perhaps the most appropriate head of power has become s51(i).[104] An examination of the analogous American Commerce Clause is a likely place to begin this analysis.

3. A Comparative Model: The United States Commerce Clause

The ‘commerce clause’ of the United States Constitution empowers the Congress to ‘regulate Commerce with foreign Nations and among the several states and with the Indian Tribes.’ Canada too has ‘eleven functioning labour relations systems’[105] and its national regime is also based on a commerce power.[106] However, it is valuable to consider the United States situation as a prime comparator for three reasons. First, the text of the clauses are substantially the same; indeed the s51(i) language was copied at Federation from its American predecessor.[107] Second, in Australia and the US, but not in Canada, the Constitution allocates only certain enumerated powers to the federal legislature, preserving residual and general power to the States.[108] Thirdly, the structural and textual similarity between the two federal systems means that United States jurisprudence is a relevant consideration for Australian jurists. And fourthly, the economies of Australia and the United States are, at the opening of the 21st Century, substantially similar. Both are characterised by highly sophisticated and mature consumer markets, strong service sectors and open import/export of commodities and manufactures. For these reasons, it is both foreseeable and desirable that the High Court have regard to the American Commerce Clause decisions.[109]

It is important to note, however, that there is not a perfect symmetry. As Zines, Mason and Williams all point out in their analyses of the United States jurisprudence,[110] the Australian Constitution explicitly gives the Commonwealth power over certain ‘commerce-related’ matters, such as banking and corporations.[111] The United States Commerce Clause, without these adjunct powers, has always needed to do a large amount of ‘constitutional work’ to permit Federal regulation in these areas. In the same way, the American Constitution contains no equivalent of the Australian industrial power.[112] It is important to remember then that the broad American interpretation described below has, to an extent, been a ‘virtue born of necessity’.[113]

Constitutionally it seems anomalous that despite the great textual similarity between Art I, s8, cl3, and s51(i), two such disparate interpretations are maintained. Congress first asserted its power to regulate labour relations in the Railway Labor Act 1926 (US),[114] held to be a constitutionally valid protection of interstate commerce in 1930.[115] Roosevelt’s New Deal took advantage of this early finding with the National Labor Relations Act 1935 (US)[116] (hereinafter NLRA) and the Fair Labour Standards Act 1938 (US) (hereinafter FLSA). These statutes still provide the core federal protection of collective bargaining,[117] union organisation,[118] minimum wages,[119] maximum hours[120] and other employment standards.[121] If a United States style interpretation of s51(i) were adopted, we might fairly confidently predict the Australian Parliament would assume a similar power to legislate directly for labour standards. I concentrate therefore on the contours of the American interpretation.[122]

The key judicial decision as to the validity of federal labour legislation was made in National Labor Relations Board v Jones & Laughlin Steel Corp.[123] The Jones and Laughlin Steel Corporation, a large producer and interstate transporter of manufactured steel, was charged with ‘unfair labor practices’ under the NLRA. The Supreme Court’s reasoning in that landmark case still underpins the scheme of regulation described above. It may be distilled to two relevant postulates:

It is useful to say one other thing about the reasoning of the unanimous Court in Jones & Laughlin. It acknowledged the restriction ‘upon the federal power which inheres in the constitutional grant’.[132] If legislation were allowed to ‘destroy the distinction’ between internal and interstate commerce, then it would be invalid, for it would simultaneously destroy the nation’s ‘dual federalism’.[133] These fears and limitations, it will be seen, currently decide the matter in the Australian jurisprudence.[134] But, as the two postulates above show, the court did not destroy this distinction at law in Jones & Laughlin. Rather, it maintained the duality, while simultaneously recognising that legislation under the power might necessarily blur or cross the line if regulation of intrastate commerce was ‘essential or appropriate’ to regulate interstate commerce. I argue that such an approach is suitable in the Australian situation: an implied distinction between the two types of commerce should not obliterate what is, at its heart, an explicit affirmative grant of power.

A series of subsequent cases confirmed and broadened the reasoning in Jones & Laughlin. In US v Darby[135] a unanimous Supreme Court held that the FLSA validly applied to a manufacturer of lumber who was only partly engaged in interstate trade. The case applied the test developed in Jones & Laughlin to a small largely intrastate producer, and in doing so gave an ‘expansive definition to Congressional authority under the Commerce Clause.’[136] In Wickard v Filburn[137] the interpretation reached its zenith. There, the Court held that, even if a farmer is producing wheat for his own consumption and with no intention of selling it, that wheat is ‘in commerce’ because it affects the broader wheat market.[138] The principle was expressed clearly by Jackson J: activities will affect commerce, and thus be within the power of Congress to regulate, if they exert a ‘substantial economic effect’ upon interstate or overseas commerce.[139] This substantial effect test was applied in later cases[140] and is now a firmly established part of United States law. It is also a legally defensible and economically accurate way to understand the true nature of the grant in s51(i) of the Australian Constitution.

The recent case law has evinced a shift away from a broad construction of the Commerce Clause, and a reassertion of the judiciary’s right to review and invalidate legislation made under that clause. In both US v Lopez[141] and US v Morrison,[142] over strong dissents, the majority invalidated certain federal laws that purported to regulate conduct occurring solely within a state. However, all the justices but one[143] continued to apply the substantial effect test. Williams argues that the narrower understanding of the Commerce Clause may encourage Australian jurists to refer to Supreme Court cases.[144] It does indeed seem more likely that ‘contemporary High Court judges looking to escape the rigidities of past jurisprudence upon s51(i)’,[145] will find an easier analogy in the reduced though still persuasive United States jurisprudence.

It is useful to note one other aspect of the American legal landscape. Unlike their Australian equivalent, both the NLRA and FLSA begin with ‘congressional findings’ (of fact) and ‘declarations of policy’.[146] These recite, in broad terms, the effects of labour disputes upon commerce,[147] and then assert a clear link between the Clause and the industrial legislation by declaring it to be ‘the policy of the Act’ to prevent these disputes so as to protect commerce. The courts in the United States generally defer to these legislative findings (and in so doing uphold legislation as sufficiently connected to commerce), so long as they have a ‘rational basis’[148] and the implementation mechanism selected is ‘reasonable and appropriate’.[149] Though there is not the same doctrine of ‘judicial deference’ in Australia, the Parliament might consider inclusion of similar findings of fact as a ‘causative hook’ if attempting broad reform using s51(i).

Thus, the United States labour market is essentially now a national and nationally regulated one.[150] Directly determined and legislated minimum standards and dispute resolution mechanisms apply under a broadly understood interstate commerce power. Overlap and the associated costs are minimised, employment rights are clear and accessible, and the Congress can directly determine and protect the rights and obligations of participants in the market.

4. The Australian Trade and Commerce Power

Under this power as it currently stands, the Commonwealth cannot regulate purely intra-state trade and commerce ... . [However, with] the advent of rapid transportation and communication, and the development of modern technology, trade within each State has become intricately connected with inter-state and overseas trade. And the nationalisation of the economy has necessarily expanded the concept of inter-state trade to embrace activities and transactions that formerly had local significance only. These developments might conceivably justify a re-interpretation of the trade and commerce power, the exiting interpretation of which may be anchored in the artifices of legal formalism.[151]

In this section I argue that the Commonwealth already has a power that, when properly understood, provides a basis upon which to regulate those employment relationships in or affecting interstate trade and commerce. I begin with an examination of the current, narrower judicial view of that clause and then argue that that view is mistaken. In the second part I describe a positive alternative interpretation based on the United States model. I then indicate what a workplace relations system under a more broadly understood power could look like.

A. The Present Understanding of s51(i) is Too Narrow

(i) The Inter/Intrastate Distinction

In a series of cases culminating in Attorney-General (WA) v Australian National Airlines Commission,[152] the grant of power to the Commonwealth under s51(i) has been understood in a narrow and increasingly unsustainable way.[153] The primary reason for this interpretation has been the court’s desire to preserve a rigid separation between intrastate and interstate (and foreign) commerce. This has barely masked a desire to protect a notion of dual federalism[154] and an often unexplained antipathy to United States authorities, particularly the ‘commingling doctrine’.[155]

Judges have relied primarily upon the terms of s51(i) to derive this distinction:

The Parliament shall, subject to this Constitution, have power to make laws for the peace, order, and good government of the Commonwealth with respect to: —
(i) Trade and commerce with other countries, and among the States.

The distinction is thus justified by a negative implication: because intrastate trade is not mentioned.[156] This ‘controversial distinction’[157] between intra- and interstate trade was attributed undeserved importance from an early stage by Dixon J (in R v Burgess[158] and Wragg v NSW,[159]) and his ‘early view proved to be influential’.[160] So as to proactively protect a sphere of State power, a type of implied constitutional prohibition was developed and continued: the Commonwealth could not legislate in any way that would ‘obliterate’ the clear ‘distinction’ that the Constitution supposedly draws.[161] Dixon wrote:

The distinction which is drawn between inter-State trade and the domestic trade of a State ... may well be considered artificial and unsuitable to modern times. But it is a distinction adopted by the Constitution and it must be observed however much interdependence may now exist between the two divisions of trade and commerce which the Constitution thus distinguishes.[162]

Intrastate commerce was thus effectively quarantined. If intra and interstate trade were commingled, regulation of that mixed activity would be beyond s51(i): an unusual result as against the United States authorities and interpretations of other s51 powers. The better view was put by Murphy J (dissenting) in the Third Airlines Case:

Sections s51(i) and 92 make a distinction between trade and commerce among the States and that which is not, but do not make trade and commerce among the states and intrastate trade and commerce mutually exclusive.[163]

Dixon J stated that the clause contained an ‘express limitation’ preventing Commonwealth interference in intrastate trade.[164] Clearly the limitation is not express. Intrastate commerce is not mentioned in the text of s51, nor anywhere else in the Constitution.[165] As Gleeson CJ has recently said, it is one thing to recognise the limits of a s51 power; it is quite another to find in that limited grant ‘some negative implication amounting to a prohibition.’[166] It is here that my main argument sits: the implied distinction between the two types of commerce should not obliterate what is, at its heart, an explicit affirmative grant of power.

Both the Second and Third Airlines Cases,[167] while affirming the Dixonian distinction, actually found that Commonwealth regulation of intrastate flights was valid. The majority in Second Airlines developed a complicated physical/economic effects dichotomy to underpin its decision:[168] intrastate trade which physically affected interstate trade could be regulated, while effects that were economic would not be enough to give the Commonwealth power. This distinction has been roundly criticised,[169] and it would be difficult I think to maintain before a modern court. It seems clear on its face that the exclusion of economic considerations from the construction of a commerce power,[170] so as to buttress an implied prohibition of a type discredited in Engineers,[171] should invite some reconsideration of the rigid distinction.

It is important to point out, by way of contrast, that there are several express constitutional prohibitions relating to commerce: for example, Commonwealth commercial regulation may not ‘give preference to one State or any part thereof over another State or part thereof’,[172] and nor may the Commonwealth ‘by any law or regulation of trade or commerce, abridge the right of a State or of the residents therein to the reasonable use of the waters of rivers for conservation or irrigation.’[173] These explicit reductions of the scope of the Commonwealth’s legislative prerogative would almost certainly continue, no matter the breadth of the reading given to s51(i).

(ii) Why the Present Narrow Rule Should be Rejected

This implied prohibition should no longer be a part of Australian law; the technical distinction between inter- and intrastate commerce should no longer constrain the clear terms of s51(i). Sir Anthony Mason has rejected the narrow view of s51(i) as ‘restrictive and formalistic’ and has advocated instead ‘a more policy-oriented approach to constitutional interpretation’.[174] There are four main reasons why Sir Anthony is correct. First, the present rule requires a version of the reserved State powers doctrine rejected since the Engineers Case. Second, the restrictive interpretative methodology applied to s51(i) is anomalous in the context of other Commonwealth powers. Third, the narrow Airlines rule deprives the s51(i) grant of the bulk of its essential content. And fourth, the cogent and unanimous decision in Cole v Whitfield means that the closely related s92, for the first time in constitutional history, no longer throws a long shadow over s51(i). I will discuss each of these reasons in turn.

A concern to ‘protect’ Australia’s ‘dual federalism’, by preserving certain powers to the States, often lies behind the judicial resistance to a broader interpretation of s51(i).[175] Up until 1920, the High Court read the powers in s51 subject to a theory of reserved state power: ‘grants of power to the Commonwealth were interpreted so as not to encroach on matters traditionally within the legislative realm of the States.’[176] This doctrine was clearly rejected by the court in the Engineers’ Case, a rejection that many subsequent cases have confirmed.[177] Since that time the powers in s51 have generally been read according to their terms, an interpretative methodology most often favourable to the Commonwealth.[178] In the Third Airlines Case[179] Murphy J concluded that the ‘maintenance of the supposed division [between inter and intrastate commerce] keeps the pre-Engineers ghosts walking.’[180] Zines similarly concludes that the distinction is ‘lacking in logic unless one adopts a doctrine of reserved powers.’[181] Of course, a shift to a broad, United States-style understanding of the commerce clause need not dissolve the jurisprudential differentiation between intra and interstate commerce. Although the development I am advocating may well, in fact, allow the Commonwealth to reach far further into the internal commerce of a state, this should not be because the legal definitions are ‘obliterated’; rather, the Court should recognise that the connectedness of commerce and thus a broad interpretation of s51(i) are ‘the inevitable consequence of national economic integration’.[182]

The second reason why the restricted interpretation of s51(i) should be revised is that it is anomalous against the ‘plain meaning’ approach adopted for s51 powers.[183] This approach construes each of the heads of power according to its terms, and resists the imposition of limits derived from the more narrow expression of overlapping powers.[184] For example, it would be curious to find that ‘trade and commerce’ did not extend to the regulation of telecommunications merely because of the existence of s51(v). The better view, I think, is that:

[i]n the interpretation of the Constitution it is a mistake to assume too readily that the presence of a particular head of power reflects an assumption on the part of the framers that the subject matter was not included in another head of power. A competing hypothesis of at least equal strength is that the former head of power was expressed as it was because doubts were entertained as to the scope of the latter.[185]

In the case of the external affairs and perhaps other powers, implicit limitations have been expressly rejected in favour of reading the grant ‘with all the generality that the words will admit’.[186] This approach has been widely accepted as a ‘principle of constitutional interpretation.’[187] In the Tasmanian Dam Case, Brennan J held that the application of this broad ‘canon of construction to the affirmative grants of paramount legislative powers gives the Constitution a dynamic force which is incompatible with a static constitutional balance.’[188] The narrow construction of the trade and commerce power denies this dynamic force in an outmoded attempt to maintain a static constitutional balance.

It is worth remembering, too, that trade and commerce is the first of a long list. Though it appears that the powers are somewhat randomly ordered, the primacy of ‘trade and commerce’ reflects the importance of the Federation goal of economic fluidity and integration. The drafting may thus reflect, at least partly, the significant place that the founding fathers envisaged for s51(i).

Third, limiting the Commonwealth’s power to only interstate trade is a technical legal idea that is increasingly difficult to apply coherently to the facts. Lines between intrastate and other trade are difficult to draw: exports and interstate commerce are now heavily entwined with and affected by intrastate commerce.[189] Corporations and traders are increasingly using sub-contracting and other techniques that demand greater reliance upon others; others that often operate outside of their state. The tools of business are, likewise, increasing the interconnectedness of even the smallest sole traders. If my local corner shop accepts payment for the nationally produced morning paper using an EFTPOS system maintained on a computer in India, it seems patently artificial to attempt to maintain that that paper purchase is outside constitutional commerce.

All but the hardest originalist would concede that this factual change must have implications for the interpretation of the Constitution:

[t]he complexity of modern commercial, economic, social and political activities increases the connections between particular aspects of those activities and the heads of Commonwealth power and carries an expanding range of those activities into the sphere of Commonwealth legislative competence.[190]

As the nature of commerce has changed so has the traditional approach become more difficult to maintain.[191] The Constitution can no longer live for horse shoes when everyone is driving Toyotas.

Fourth, the relationship between s51(i) and s92 has been a major factor in all past interpretations of the power.[192] Section 92, which provides for the absolute freedom of interstate trade, commerce and intercourse, has been one of the most litigated provisions in the Australian Constitution. In Cole v Whitfield,[193] a unanimous High Court determined that this provision only prevented imposition of ‘discriminatory burdens of a protectionist kind’. The decision overturned a ‘fractured jurisprudence’[194] and represents a ‘new and sensible beginning’ in the area.[195] The Court itself observed that s51(i) and s92 now ‘sit more easily together’.[196] Williams concludes that most national legislation of general operation under s51(i), including relevantly a national industrial scheme of industrial regulation, will not fall afoul of s92.[197] This new context means two things for the interpretation of s51(i). First, it gives the Court good reason to re-examine the rules in the Airlines Cases and somewhat pre-empts any stare decisis problem. Second, the simpler discriminatory burdens test allows and even encourages a broader construal of s51(i). Previously, the understanding of s51(i) was narrowed and the power constrained so as to ‘protect’ various strained and complex understandings of s92.[198] That need no longer be the case; the new Cole v Whitfield beginning means that s51(i) need no longer be ‘deprived of its essential content’.[199]

It is my argument then that the strict separation and ‘implied immunity’ is unsustainable both in law and in the present day factual context. A better approach would be to acknowledge, as the Supreme Court of the United States has done, that the power over interstate commerce can extend to some intrastate commerce and production.

The question then becomes: what should be the connection required, between interstate and intrastate commerce, such that power over the former could permit regulation of the latter?

B. What Construction Should the Trade and Commerce Power Be Given?

It falls now to postulate a positive position, first, on how ‘trade and commerce’ should be interpreted and defined: and second, on how a law regulating industrial matters might be characterised such that it came within a s51(i) jurisdiction. The interpretation/characterisation approach is a useful reasoning tool, though the two are not strictly separable and at points the distinction between them, like the distinction between inter and intrastate commerce, ‘tends to break down’.[200] I end this section by broadly forecasting some of the possible effects a revitalised first head could have in the industrial field.

(i) Interpretation

Firstly, it will fall to the courts to interpret the Constitution: what precisely does ‘trade and commerce’ mean? Although ‘it is hard to describe the content of the trade and commerce power without referring to examples of laws which are inside or outside that power’,[201] the creation of a general rule will be important for the coherent development of a s51(i) jurisprudence. So as to more clearly indicate the way forward, the following discussion is structured around statements of a possible test — What will be the connection required between constitutional commerce and other commerce?

It is not within the scope of this paper to examine which test is most appropriate, or how the High Court is most likely to find in a future case. It is sufficient to point out that the interpretation ought to focus on what is necessary or appropriate to make the grant of power over constitutional commerce effective. That is the slab of stone which the courts should attack with their judicial chisels. The precise features of the statute so produced will and should emerge gradually, and will depend on the facts and frquency of cases that provide ‘suitable vehicles for agitation of the question.’ A number of possible formulations are here to indicate the contours of the slab. The Commonwealth could be permitted to legislate with respect to:

No matter which wording is chosen, the court ought to frame its test in terms of a connection to constitutional commerce; I do not think it could coherently define constitutional commerce such that it included all intrastate trade and production.[206] Most probably, the Commonwealth would attempt to broadly assert its jurisdiction: the relevant law would purport to bind all employees and employers ‘in’ that commerce which ‘relates to’ constitutional commerce. Alternatively, the more direct route may be taken: the relevant law could purport to bind all employees and employers who ‘affect constitutional commerce’.

Of course, however, a scheme limited to narrow constitutional commerce[207] would suffer many of the same disadvantages as a corporations power-based scheme. It would not, however, involve any purposive element as is sometimes seen for the external affairs power. Section 51(i) is not restricted to laws for the ‘protection or development’ of trade and commerce. Rather, ‘it is a power to make laws with respect to overseas trade and commerce and, subject only to express limitation, it extends to forbidding ... commerce itself or anything occurring in or directly affecting such trade and commerce.’[208]

I noted earlier that the High Court has not examined the trade and commerce power for a great many years. That was until a very recent decision from a unanimous seven member bench in Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc.[209] In a short and unambiguous analysis, the Court declined to invalidate or read down s5(3) of the WR Act, which extended the jurisdiction of the Australian Industrial Relations Commission to industrial ‘issues’ between ‘employers and maritime employees’ engaged in constitutional commerce.[210] That declination, by itself, seems not to break any great amount of new ground. However, in the course of the judgment, the Court held that:

[a] ship journeying for reward is in commerce; those who co-operate in the journeying of the ship are in commerce and the wages of those persons and the conditions of their employment relate to that commerce.[211]

The Court’s use of the words ‘relate to’[212] is significant. If the connection required between constitutional commerce and the employment conditions regulated is one of mere ‘relation’, that burden would be less than difficult to discharge for the majority of Australian workers. Similarly, ‘those who co-operate’ is a broad formulation, and implies that a person will be in commerce even if that person is not directly so engaged. The Court also made a point of referring approvingly to a United States authority on the United States Commerce Clause,[213] indicating that such authority is at least relevant in construing our own s51(i).[214] Despite these good omens, it would be unwise to extrapolate too far, especially given the law at issue was itself restricted to maritime workers engaged in constitutional commerce narrowly defined, and given the ‘neatness’ of the facts: the relevant employees were all foreign nationals engaged as crew of a journeying ship.[215]

(ii) Characterisation

The second question would be one of characterisation. This inquiry reads the law and its effects so as to ascribe to that law a character which brings it within, or takes it outside, the grant of power. In this way, characterisation looks to the connection required between the matters regulated (for example, employment conditions) and the interstate or overseas commerce, however defined.[216] Would a law that dealt with employment relationships be sufficiently associated with constitutional ‘trade and commerce’ that it would be a valid law under the terms of s51(i)? This question is difficult to deal with in abstract, and thus a matter which is best left largely aside for the moment, in the absence of test industrial legislation.

However, there are certain general statements of principle that will guide judicial officers in their characterisation of an impugned law. First, the character of the law ‘must be determined by reference to the rights, powers, liabilities, duties and privileges which it creates’.[217] Second, the law must be able fairly to be characterised as being ‘on’ the relevant subject, here constitutional commerce. ‘The court does not demand to be satisfied that the challenged law is a law “with respect to” the relevant topic, but only that it can fairly be described in that way’.[218] This approach is both broad and ‘permissive’.[219] Once a connection is found to exist between the law and the head of power, ‘the law will be “with respect to” that head of power unless the connection is “so insubstantial, tenuous or distant” that it cannot sensibly be described as a law “with respect to” that head of power’.[220] If provisions were included that confined the regime’s application to employees ‘engaged in’ or ‘cooperating in’ (or whose employment ‘related to’) constitutional commerce, then the law would probably satisfy this requirement. Similarly broad provisions are found in the NLRA[221] and FLSA.[222]

There are quite definite signs that labour regulation will generally come within trade and commerce as judicially understood. First, in Australian Steamships Limited v Malcolm,[223] it was held that Parliament can validly regulate the conduct of persons employed in activities that are part of overseas and interstate trade and commerce.[224] This law is ‘well settled’.[225] Second, the commerce clause in the United States has long grounded extensive federal labour standards and union organisation mechanisms, even though these matters do not ‘seem’ commercial in nature.[226] Third, the power has been utilised before by the Australian Parliament, especially with regard to waterside workers’ and flight crew officers’[227] access to the AIRC,[228] unfair dismissal remedies,[229] and agreement certification.[230] So long as the commerce is within s51(i), courts have commonly held that labour matters affecting that commerce are also covered.[231]

Thus, we might surmise that the width of the interpretation would determine the coverage of any scheme (in other words, how many of those working in, say, purely intrastate commerce would be bound by the Commonwealth law). The best view on characterisation is that a scheme would continue to be valid, no matter how wide the judicial understanding of constitutional commerce, so long as it were expressed to apply only to a defined group — for example, those whose employment ‘relates to constitutional commerce’.[232]

(iii) Future Directions

Depending on the understanding of what constitutional commerce is, and which types of matters sufficiently affect it, many new types of employment relationships could be brought within the scope of the Workplace Relations Act for the first time. Workers at partnerships, family businesses and sole traderships; outworkers; domestic workers; participants in the cash economy; and many others, could potentially be regulated by the Commonwealth, in some cases for the first time. Such breadth would rely, of course, on a liberal understanding of trade and commerce and what sufficiently affects it, but it could well herald a major increase in coverage, and an associated development in the way we think of labour law in Australia. Those that have in the past fallen through the gaps caused by the exigencies of the industrial power, and those that would continue to be systemically excluded under a corporations based-scheme, could for the first time find their place in the schema of employment rights and relationships.

5. Conclusion

I have argued that the costs, gaps and overlaps that characterise the Australian industrial relations system are primarily caused by an over-reliance upon the limited industrial power. The requirement that disputes be interstate results in a dual system of state and federal industrial jurisdiction; ‘conciliation and arbitration’ requires a particular form of dispute resolution; and ‘dispute’ prevents the Parliament from directly and clearly setting out the rights of Australians as workers and employers. Though the Workplace Relations Act now relies upon a web of alternative constitutional provisions to ameliorate these problems, neither the corporations nor the external affairs power provide the Commonwealth with both broad coverage and policy flexibility.

Thus, the Commonwealth and the High Court should look afresh at industrial regulation under the trade and commerce power. Section 51(i) is a sleeping giant, left unconsidered for too long in times of rapid economic and industrial change. Most commentators now agree that the present construction is unsustainable and unsound. The ‘artifices of legal formalism’[233] that permit the narrow view must now be rejected. A flexible, broad, unitary industrial system is in sight.


[*] BCom (Eco), LLB (Hons) (Melbourne); Articled Clerk, Mallesons Stephen Jaques. The views expressed in this article are those of the author and do not represent the opinions of Mallesons Stephen Jaques. I am grateful to Eloise Dias, Joel Fetter, Martin Joy, Professor Cheryl Saunders and the anonymous referees for comments on earlier drafts. The usual caveat applies.

[1] The first post-Federation session of Parliament: Sam Eichenbaum, ‘What Chance a Single Industrial Relations System in Australia?’ (2002) Law Inst J 66 at 66.

[2] See Victoria v The Commonwealth (1996) 187 CLR 416 (hereinafter Industrial Relations Act Case); at 464–6 (Dawson J).

[3] See Constitution Alteration (Legislative Powers) 1910 (Cth); Constitution Alteration (Industrial Matters) 1912 (Cth); Constitution Alteration (Railway Disputes) 1912 (Cth); Constitution Alteration (Legislative Powers) 1919 (Cth); Constitution Alteration (Industry and Commerce) 1926 (Cth); Constitution Alteration (Industrial Employment) 1946 (Cth); see also Parliament of Australia, Parliamentary Handbook (‘Referendum Results’) (2003): <http://www.aph.gov.au/library/handbook/referendums> (14 December 2003).

[4] Commonwealth Powers (Industrial Relations) Act 1996 (Vic).

[5] See, for example, Abbott, below n10.

[6] See generally Mark Wooden, The Transformation of Australian Industrial Relations (2000) especially at 7–37, 126–147; Lord Wedderburn, Max Rood, Gerard Lyon-Caen, Wolfgang Daubler & Paul van Der Heijden, Labour Law in the Post-Industrial Era (1994).

[7] See Ronaldo Munck, Globalisation and Labour: The New ‘Great Transformation’ (2002) at 67, 137, 140, 188; compare discussion at 148 (transnational union organisation).

[8] Breen Creighton, William Ford & Richard Mitchell, Labour Law: Text and Materials (2nd ed, 1993) at 332–333 (‘there are definite indications that this particular head of power is likely to play a rather more significant role in [industrial relations] in the future’); George Williams, Labour Law and Constitution (2000) at 144 (‘A broader interpretation of the trade and commerce power would provide a significant new foundation for Commonwealth intervention in the field of industrial relations’); Leslie Zines, The High Court and the Constitution (4th ed, 1997) at 55–79; see generally Ronald McCallum & Marilyn Pittard, Australian Labour Law: Cases and Materials (3rd ed, 1995); Breen Creighton & Andrew Stewart, Labour Law: An Introduction (3rd ed, 2000). See also works with a constitutional focus: for example Patrick Lane, Commentary on the Australian Constitution (2nd ed, 1997) at 156–9; George Winterton, Hoong Phun Lee, Arthur Glass & James Thomson, Australian Federal Constitutional Law: Commentary and Materials (1999) at 190–201.

[9] Cole v Whitfield [1988] HCA 18; (1988) 165 CLR 360.

[10] The Hon Tony Abbott MP, Minister for Employment and Workplace Relations, ‘The High Price of Militant Unions’, speech notes for the Confectioners’ Lunch, 7 December 2001 at 4.

[11] Review into Australian Industrial Relations Law and Systems (Committee) Australian Industrial Relations Law and Systems: Report of the Committee of Review (Canberra: AGPS, 1985) Vol 2 at 270 (hereinafter Hancock Report).

[12] The Commonwealth, and each of the states except Victoria, which has referred its industrial power to the Commonwealth under s51(xxxvii): Commonwealth Powers (Industrial Relations) Act 1996 (Vic); and see also Stuart Kollmorgen, ‘Towards a Unitary National System of Industrial Relations? Commonwealth Powers (Industrial Relations) Act 1996 (Vic), Workplace Relations and Other Legislation Amendment Act (No 2) 1996 (Cth)’ (1997) 10 AJLL 158.

[13] Compare Harry W Arthurs, Donald Carter & Harry Glasbeck, Labour Law and Industrial Relations in Canada (4th ed, 1993) at 53–54.

[14] Constitution s51(xxxv).

[15] Constitution s109.

[16] See The Hon Peter Reith MP, Minister for Employment, Workplace Relations and Small Business, Breaking the Gridlock: Towards a Simpler National Workplace Relations System – Discussion Paper 1: The Case for Change (Canberra, October 2000) (hereinafter Breaking the Gridlock 1) at fn85.

[17] James Macken, Australian Industrial Laws: The Constitutional Basis (2nd ed, 1980) at 205–207 and sources therein.

[18] Id at 207–209; and see below.

[19] Macken, above n17 at 210–14.

[20] See s30 of the former Conciliation and Arbitration Act 1904 (Cth), explained in Collins v Charles Marshall Pty Ltd [1955] HCA 44; (1955) 92 CLR 529.

[21] See, for example, Federal–State Relations Committee, Parliament of Victoria, Second Report on Australian Federalism: The Role of the States (Melbourne: Government Printer, 1998) at 103–126.

[22] See Breaking the Gridlock 1, above n16; The Hon Peter Reith MP, Minister for Employment, Workplace Relations and Small Business, Breaking the Gridlock: Towards a Simpler National Workplace Relations System – Discussion Paper 2: A New Structure (Canberra, October 2000) (hereinafter Breaking the Gridlock 2).

[23] Though the power is not purposive: Industrial Relations Act Case, above n2; Re Pacific Coal Pty Ltd, Ex parte Construction, Forestry, Mining and Energy Union (2000) 203 CLR 346 at 412 (Hayne & Gummow JJ) (hereinafter Re Pacific Coal).

[24] See Neil Williams & Andrew Gotting, ‘The Interrelationship between the Industrial Power and Other Heads of Power in Australian Industrial Law’ (2001) 20 Aust Bar Rev 264 at 264.

[25] See generally Williams & Gotting, above n24 at 264; Waterside Workers’ Federation of Australia v Commonwealth Steamship Owners’ Association [1920] HCA 20; (1920) 28 CLR 209 at 218; R v Commonwealth Conciliation and Arbitration Commission; Ex parte Amalgamated Engineering Union (Australian Section) [1967] HCA 47; (1967) 118 CLR 219; see also Re Pacific Coal (2000) 203 CLR 346 at 370–1, 383–6.

[26] R v Commonwealth Conciliation and Arbitration Commission; Ex parte Amalgamated Engineering Union (Australian Section) [1967] HCA 47; (1967) 118 CLR 219 at 242 (Barwick CJ) at 269 (Windeyer J). Compare Fair Labor Standards Act 1938 (US), 29 USC s206, to which I return below, and the Industrial Relations Amendment Act 1993 (Cth). Note, however, the unexplored ‘prevention’ aspect of the power, which I discuss below at n31 and accompanying text.

[27] Andrew Stewart, ‘Federal Labour Law and New Uses for the Corporations Power’ (2001) 14 AJLL 145 at n148.

[28] See Workplace Relations Act 1996 (Cth) s149(1); compare the Act’s transmission of business provisions.

[29] Australian Boot Trade Employees’ Federation v Whybrow & Co [1910] HCA 53; (1910) 11 CLR 311; R v Kelly; Ex parte Victoria [1950] HCA 7; (1950) 81 CLR 64 at 79–82.

[30] See Williams & Gotting, above n24 at 266; R v Ludeke; Ex parte Queensland Electricity Commission [1985] HCA 55; (1985) 159 CLR 178 at 181–2; A–G (Qld) v Riordan [1997] HCA 32; (1997) 192 CLR 1 at 39–40 (Kirby J).

[31] See Re Federated Storemen and Packers Union of Australia; Ex parte Wooldumpers (Vic) Ltd [1989] HCA 10; (1989) 166 CLR 311 at 320–1 (Mason CJ), 327 (Deane J); Williams, above n8 at 47–48 and 83–4.

[32] See the analysis and examples below in Parts 2 and 4 and provisions of the WR Act at nn227–230.

[33] Wooden, above n6 at 181.

[34] Re Pacific Coal (2000) 203 CLR 346 (Gleeson CJ, Gummow, Hayne & Callinan JJ; compare Gaudron, McHugh & Kirby JJ).

[35] A ‘Serbonian bog of technicalities’: id at 422 (Kirby J), quoting HB Higgins in Robert Garran, Prosper the Commonwealth (1958) at 225.

[36] The current federal government has often made this criticism, in my view quite validly. On the growth of non-union employee relations in recent times see generally John Campling & Paul Gollan, Bargained Out: Negotiating without Unions in Australia (1999).

[37] Hancock Report, above n11 at 264–9; Breaking the Gridlock 1, above n16.

[38] Hancock Report, above n11 at 261.

[39] See, for example, the former Industrial Relations Act 1988 (Cth) s67 (regarding State/Commonwealth Industrial Commissions conferences).

[40] See a full review in Macken, above n17 at ch18–19.

[41] See, for example, Maritime Industries Act 1929 (Cth) (an early example of reliance on the trade and commerce power); WR Act s5 (concerning access to the AIRC); WR Act pt VIB div 3 (extending the reach of Commonwealth provisions using the corporations power) and WR Act pt IVA div 5 (implementing the ILO Workers with Family Responsibilities Convention 1981 and Workers with Family Responsibilities Recommendation 1981).

[42] See, for example, WR Act sch 1A (conditions for Victorian workers).

[43] Hancock Report, above n11 at 264.

[44] See generally Anthony Forsyth, ‘Re-Regulatory Tendencies in Australian and New Zealand Labour Law’ in Working Paper No 21, Centre for Employment and Labour Relations Law (Parkville, The University of Melbourne, 2001) at 19.

[45] See below Part 4, The Australian Trade and Commerce Power’.

[46] Constitution s51(xxxvii).

[47] Constitution s128. An amendment could simply give the Commonwealth power over ‘industrial relations’.

[48] Compare Federal Awards (Uniform System) Act 2003 (Vic) ss50–53.

[49] Breaking the Gridlock 1, above n16, Breaking the Gridlock 2, above n22. See further Stewart, above n 27.

[50] See below Part 2.B, The Options under other Powers’.

[51] Sir Anthony Mason, ‘Role of a Constitutional Court in a Federation’ (1986) 16 Fed LR 12; Sir Anthony Mason, ‘The Australian Constitution 1901–1988’ (1988) 62 ALJ 752; Seaman’s Union of Australia v Utah Development Co [1978] HCA 46; (1978) 144 CLR 120 at 152, 154 (hereinafter Seaman’s Union v Utah Development Co) (Mason J). See also Michael Kirby, ‘Accident Prevention, Compensation and Law Reform’ paper presented to the National Conference on Health and Safety at Work (Sydney, 1979) quoted in Neil Gunningham, Industrial Law and the Constitution (1988) at 146.

[52] Cole v Whitfield, above n9 at 360; see below Part 4.A.ii, ‘Why the Present Narrow Rule Should be Rejected’.

[53] See, for example, Breaking the Gridlock 1, above n16 and Breaking the Gridlock 2, above n22.

[54] See, however, Williams, above n8 at 140–145; Zines, above n8 at 55–79. The last major consideration of the power and labour law was S D Hoptop, 1974. The Commonwealth’s reluctance to urge a wider interpretation, both in constitutional litigation and in policy papers, is curious: see, for example, the cursory discussion Breaking the Gridlock 1, above n16.

[55] See, for example, Creighton, Ford & Mitchell, above n8 at 332–333.

[56] See, for example, Strickland v Rocla Concrete Pipes (1971) 124 CLR 468; compare Bank of New South Wales v Commonwealth (hereinafter Bank Nationalisation Case) [1948] HCA 7; (1948) 76 CLR 1 (concerning the ‘just terms’ guarantee).

[57] See further Parts 2.B.ii and 2.B.iii below.

[58] [1943] HCA 37; (1943) 68 CLR 87.

[59] Tony Blackshield & George Williams, Australian Constitutional Law and Theory: Commentary and Materials (3rd ed, 2002) at 654.

[60] This seems to have been the general approach taken by the majority in the Industrial Relations Act Case, above n2; contrast the reasons of Dawson J.

[61] Leslie Zines, ‘Commonwealth Legislative Powers’ in Tony Blackshield, Michael Coper & George Williams, The Oxford Companion to the High Court of Australia (2001).

[62] Strickland v Rocla Concrete Pipes (1971) 124 CLR 468.

[63] Kevin Booker, Arthur Glass & Robert Watt, Federal Constitutional Law: An Introduction, (2nd ed, 1998) at 48; see, also, Northern Suburbs General Cemetery Reserve Trust v Commonwealth [1993] HCA 12; (1993) 176 CLR 555 at 569, 579.

[64] See below Part 4.B, ‘Characterisation’.

[65] Seaman’s Union v Utah Development Co, above n51 at 154 (Mason J).

[66] Industrial Relations Act Case, above n2 at 487–8, 496 (Brennan CJ, Toohey, Gaudron, McHugh & Gummow JJ) approving a test originally developed in Commonwealth v Tasmania (hereinafter Tasmanian Dam Case) (1983) 158 CLR 1 at 529 (Deane J).

[67] See generally WR Act pt VIA (Minimum entitlements of employees); Williams & Gotting, above n24 at 273–75.

[68] Industrial Relations Act Case, above n2. Note, however, the effect of a change in government: see generally Workplace Relations and Other Legislation Amendment Act 1996 (Cth) (minimum wages repeal); Eichenbaum, above n1 at 68; Williams & Gotting, above n24 at n80.

[69] WR Act pt IVA div 3, implementing (inter alia) the Termination of Employment Convention 1982; compare ss170DE(2) & 170EDA(1)(b) which were invalid: Industrial Relations Act Case, above n2 at 518.

[70] WR Act ss170DF, 170MD & 170ND, implementing the International Labour Organisation (‘ILO’) Discrimination (Employment and Occupation) Convention 1958.

[71] WR Act pt IVA div 5, implementing the ILO Workers with Family Responsibilities Convention 1981 and Workers with Family Responsibilities Recommendation 1981.

[72] See generally Williams, above n8 at 98–100; Breen Creighton, ‘The ILO and the Protection of Fundamental Human Rights’ [1998] MelbULawRw 12; (1998) 22 MULR 239.

[73] Commonwealth v Tasmania, (1983) 158 CLR 1.

[74] Chu Kheng Lim v Minister for Immigration (1992) 176 CLR 1.

[75] Victoria v The Commonwealth (1996) 187 CLR 416.

[76] See Industrial Relations Act Case, above n2 and accompanying text.

[77] See Industrial Relations Act Case, above n2 at 487.

[78] See Tasmanian Dam Case, above n66 at 233–4 (Brennan J), 268 (Deane J); Industrial Relations Act Case, above n2 at 488.

[79] See generally Creighton, above n72 at 261–2, 278–80.

[80] See above nn67, 69–71 and accompanying text.

[81] See generally Creighton & Stewart, above n8 at 83–85; Wooden, above n6 at 180–182.

[82] New South Wales v The Commonwealth (1990) 169 CLR 482 at 499 (hereinafter Incorporation Case).

[83] Re Dingjan; Ex parte Wagner [1995] HCA 16; (1995) 183 CLR 323 at 333–4, 352–3, 364–5, 369 (hereinafter Re Dingjan); Tasmanian Dam Case, above n66 at 148–9, 179, 268, 270–1; Strickland v Rocla Concrete Pipes, above n56 at 489–90; Actors and Announcers Equity Association v Fontana Films Pty Ltd [1982] HCA 23; (1982) 150 CLR 169 at 207–8, 212 and 215.

[84] See Breaking the Gridlock 1, above n16; Breaking the Gridlock 2, above n22; Abbott, above n10.

[85] Breaking the Gridlock 1, above n16 at appendix 4.

[86] Andrew Stewart, ‘Federal Labour Law and New Uses for the Corporations Power’ (2001) 14 AJLL 145.

[87] Re Dingjan, above n83 at 364–5; Re Pacific Coal, above n23 at 375 (Gaudron J).

[88] Creighton & Stewart, above n8 at 83–85.

[89] Industrial Relations Act Case, above n2 at 539 (Brennan CJ, Toohey, Gaudron, McHugh & Gummow JJ).

[90] See Williams & Gotting, above n24 at 270–1; see further Re Pacific Coal, above n23 at 447–8 (Kirby J).

[91] Compare below n208 and accompanying text.

[92] Breaking the Gridlock 1, above n16 at appendix 4.

[93] See, for example, the finding in Re Dingjan, above n83.

[94] See Williams, above n8 at 145.

[95] See also Training Guarantee (Administration) Act 1990 (Cth).

[96] Northern Suburbs General Cemetery Reserve Trust v Commonwealth [1993] HCA 12; (1993) 176 CLR 555 at 569, 579. This same logic has been applied to the relationship between the trade and commerce power and employment regulation: see n65 and accompanying text.

[97] See text accompanying n93.

[98] See Hancock Report, above n11 at 250–1.

[99] Compare, for example, WR Act s5 (maritime and other workers). See below nn228–230.

[100] If read down: Acts Interpretation Act 1901 (Cth) s15A; Pidoto v Victoria [1943] HCA 37; (1943) 68 CLR 87; compare Workplace Relations and Other Legislation Amendment Act 1996 (Cth) s7A and discussion in Re Pacific Coal, above n23 at 447–8 (Kirby J). These reading down provisions may also apply to a corporations power-based scheme: see text accompanying n90.

[101] Constitution s52, perhaps also the s61 executive power/implied nationhood power.

[102] Constitution s51(vi).

[103] See generally the discussion of Mason J in Airlines of NSW Pty Ltd v New South Wales [No 2] [1965] HCA 3; (1965) 113 CLR 54 (hereinafter Second Airlines Case).

[104] Contrast Neil Gunningham, Industrial Law and the Constitution (1988) at 146.

[105] Arthurs, Carter & Glasbeck, above n13 at 19, and see especially 53–56.

[106] Ibid 54–56.

[107] Federation Debates (Official Record) (Sydney, 3 April 1891) at 662–665; RJ Buchanan & IM Neil, ‘Industrial Law and the Constitution in the New Century: An Historical Review of the Industrial Power’ (2001) 20 Aust Bar Rev 256 at 256–8.

[108] See generally Fred Whitney & Benjamin Taylor, Labor Relations Law (7th ed, 1996) at 1–8; Cheryl Saunders, The Australian Constitution (Annotated) (3rd ed, 2000).

[109] For the most recent example of the High Court’s use of relevant United States jurisprudence, see Re Maritime Union of Australia; Ex parte CSL Pacific Shipping Inc [2003] HCA 43 (7 August 2003) at [36] (discussing wages of seamen on foreign vessels). The impact of this unanimous judgment is discussed further in the text accompanying nn209–215.

[110] Zines, above n8 at 61; Williams, above n8 at 144; Mason, ‘Role of the Constitutional Court’, above n51 at 15–16.

[111] See Constitution ss51(ii), (v), (xii), (xvii), (xviii), (xx), s52(i), s90 and compare s98, which specifically includes certain things within commerce.

[112] Though this may not necessarily connote that the US/Australia situation need be different, if the powers under s51 are read as independent: see text accompanying nn56–65 and 96.

[113] Mason, ‘Role of a Constitutional Court’, above n51 at 15.

[114] 45 USC ss151–163 and 181–188.

[115] Texas & New Orleans Railroad Co v Brotherhood of Railway & Steamship Clerks [1930] USSC 113; (1930) 281 US 548.

[116] National Labor Relations Act 1935 (US) 29 USC ss151–169 (hereinafter NLRA).

[117] NLRA, 29 USC ss157–8.

[118] NLRA, 29 USC ss157, 159.

[119] FLSA, 29 USC s206.

[120] FLSA, 29 USC s207.

[121] See further Alvin L Goodman, Labor Law and Industrial Relations in the United States of America (2nd ed, 1984) at 52–4. Note that the NLRA has been amended by the Labor Management Relations Act (Taft–Hartley Act) 29 USC ss141–181 (1947) and other Acts.

[122] For a wider discussion of United States labour law, see especially William Gould IV, A Primer on American Labor Law (3rd ed, 1993).

[123] [1937] USSC 80; (1937) 301 US 1 (hereinafter Jones & Laughlin). Perhaps the most elegant critic of the Supreme Court’s broad ‘substantial effect’ test, as developed in Jones & Laughlin and other cases, is Professor Epstein: see especially Richard A Epstein, ‘The Proper Scope of the Commerce Power’ (1987) 73 Virginia LR 1387. Other advocates of a narrow view include Raoul Berger, ‘Judicial Manipulation of the Commerce Clause’ (1996) 74 Texas LR 695; and Supreme Court Associate Justice Clarence Thomas: see United States v Lopez (1995) 524 US 549 at 584–602 (Thomas J, concurring) and United States v Morrison [2000] USSC 42; (2000) 529 US 598 at 627 (Thomas J, concurring).

[124] Jones & Laughlin, above n123 at 37.

[125] Id at 34–35 and see conclusion at 43.

[126] Ibid.

[127] Id at 32. See also at 37: ‘close and intimate relation to interstate commerce’. Jones & Laughlin, above n123, thus rejected the narrow understandings of ‘affecting commerce’ in Carter v Carter Coal Co [1936] USSC 91; (1936) 298 US 238, and while still paying lip-service to conservation of the federal balance, this and subsequent decisions effectively transferred a broad and plenary power to the national Congress. See further Zines, above n8 at 55–60.

[128] In the Second Employers’ Liability Cases [1897] USSC 15; 223 US 1 at 51.

[129] Jones & Laughlin, above n123, approving the rule in the Second Employers’ Liability Cases [1897] USSC 15; 223 US 1.

[130] Jones & Laughlin, above n123 at 41.

[131] Ibid.

[132] Id at 30.

[133] Ibid.

[134] See below Part 4.A.i, ‘The Inter/Intrastate Distinction’.

[135] United States v Darby [1941] USSC 49; (1941) 312 US 100.

[136] William H Rehnquist, The Supreme Court (2nd ed, 2001) at 141.

[137] Wickard v Filburn [1942] USSC 142; (1942) 317 US 111.

[138] The extent of the effect of Mr Filburn’s non-participation in the broader wheat market is assessed against a (hypothetical) market in which Mr Filburn participated. That his non-participation had some effect upon the market, through either reducing demand or reducing supply, must certainly be true economically. The interesting question is whether the effect is substantial.

[139] Wickard v Filburn, above n137 at 124–5 (Jackson J). It is true, as Professor Zines notes, that United States courts accept a wide range of evidence relating to economic and social matters, and that the American cases thus often proceed on the basis that the judges ‘can determine and [are] capable of determining the economic nexus between the local activity and interstate commerce’ (Zines, above n8 at 60). Australian courts, for example in relation to the assessments of ‘substantial lessening of competition’ under s45, s50 and parts of s47 of the Trade Practices Act 1974 (Cth), are also now routinely charged with this type of ‘pure’ economic assessment. It would be wrong to assume then that the courts would now refuse (or be unable) to make such assessments if a test of economic effect is required or desirable under a broader interpretation of s51(i).

[140] See, for example, Perez v United States [1971] USSC 83; (1971) 402 US 146.

[141] United States v Lopez, above n123 (considering the validity under the Commerce Clause of the Gun-Free Schools Act 1990 (US)).

[142] United States v Morrison, above 123 at 600–619 (invalidating a federal provision that gave a civil cause of action to victims of gender-motivated violence that occurred within a State).

[143] Thomas J: see United States v Lopez (1995), above n123 at 584–602 (Thomas J, concurring) and United States v Morrison, id at 627 (Thomas J, concurring).

[144] Williams, above n8 at 144 (note, however, that Williams expressed these opinions solely in the context of United States v Lopez).

[145] Ibid.

[146] NLRA, 29 USC s151; FLSA, 29 USC s202.

[147] For example, NLRA, 29 USC s151(c): ‘burdening or obstructing commerce by ... materially affecting, restraining, or controlling the flow ... of goods from or into the channels of commerce’.

[148] Heart of Atlanta Motel v United States [1964] USSC 230; (1964) 379 US 241 at 258–9.

[149] United States v Wrightwood Dairy Co [1942] USSC 34; (1942) 315 US 110 at 119. See Mason, ‘Role of a Constitutional Court’, above n51 at 12.

[150] See Gould, above n122; Whitney & Taylor, above n108.

[151] Sir Anthony Mason, ‘Towards 2001 – Minimalism, Monarchism or Metamorphism’ [1995] MonashULawRw 1; (1995) 21 Mon LR 1 at 11.

[152] Attorney-General (WA) v Australian National Airlines Commission, [1976] HCA 66; (1976) 138 CLR 492 (hereinafter Third Airlines Case).

[153] The judicial history is complex: see especially Zines, above n8 at 60–74.

[154] See, for example, Second Airlines Case, above n103 at 115 (Kitto J); see below text accompanying nn175–181.

[155] See the discussion in R v Burgess; Ex parte Henry [1936] HCA 52; (1936) 55 CLR 608 of Houston, East and West Texas Railway Co v United States, [1914] USSC 201; (1914) 234 US 342; see also Williams, above n8 at 143.

[156] Section 98 of the Constitution similarly fails to mention intrastate trade directly. Section 98 specifically includes in the trade and commerce power of the Commonwealth the power to regulate certain shipping, navigation and state owned railways.

[157] Mason, ‘Role of a Constitutional Court’, above n51 at 17.

[158] R v Burgess; Ex parte Henry [1936] HCA 52; (1936) 55 CLR 608.

[159] Wragg v NSW [1953] HCA 34; (1953) 88 CLR 353 at 385–8.

[160] Zines, above n8 at 68.

[161] Wragg v NSW [1953] HCA 34; (1953) 88 CLR 353 at 386 (Dixon CJ, with whom McTiernan, Williams, Fullagar & Kitto JJ agreed).

[162] Id at 385–6.

[163] Third Airlines Case, above n152 at 530.

[164] R v Burgess; Ex parte Henry [1936] HCA 52; (1936) 55 CLR 608 at 672.

[165] See Australian Coarse Grains Pool v Barley Marketing Board (Qld) [1985] HCA 38; (1985) 157 CLR 605 at 635 (Mason J); Zines, above n8 at 77.

[166] Re Pacific Coal, above n34 at 360 (Gleeson CJ).

[167] Second Airlines Case, above n103; Third Airlines Case, above n152.

[168] See above n154 at 115 (Kitto J) and 88 (Barwick CJ). Applied by Stephen J (with whom Barwick CJ & Gibbs J relevantly agreed) in the Third Airlines Case, above n152 at 510.

[169] Third Airlines Case, above n152 at 530–1 (Murphy J); Zines, above n8 at 75–77; Leslie Zines, ‘Engineers and the “Federal Balance”’ in Michael Coper & George Williams (eds), How Many Cheers for Engineers? (1997) 81 at 86; Williams, above n8 at 142. Although Mason did not strictly need to consider s51(i), he did comment that ‘No distinction can or should be drawn between what is physically necessary and what is economically necessary’: Third Airlines Case, above n152 at 523.

[170] Third Airlines Case, above n152 at 530–1 (Murphy J).

[171] Amalgamated Society of Engineers v Adelaide Steamship Co Ltd [1920] HCA 54; (1920) 28 CLR 129 (hereinafter Engineers Case). See below nn175–182 and accompanying text.

[172] Constitution s99. For example, the Commonwealth could not validly require a higher minimum wage in Tasmania alone.

[173] Constitution s100.

[174] Mason, ‘Role of a Constitutional Court’, above n51 at 22.

[175] See, for example, Second Airlines Case, above n103 at 115 (Kitto J); Compare Dawson J in the Industrial Relations Act Case, above n2. See also Brian Galligan, A Federal Republic: Australia’s Constitutional System of Government (1995) 188.

[176] Williams, above n8 at 128–9.

[177] See, for example, Uther v Federal Commissioner of Taxation [1947] HCA 45; (1947) 74 CLR 508 at 529 (Dixon J); Strickland v Rocla Concrete Pipes, above n56 at 485 (Barwick CJ); Tasmanian Dam Case, above n66 at 128 (Mason J).

[178] See, for example, Keven Booker & Arthur Glass, ‘What Makes the Engineers Case a Classic?’ in Michael Coper & George Williams, How Many Cheers for Engineers? (1997) at 63–65. Professor Galligan regrets this shift due to its consequences for the federal balance: see Brian Galligan, above n175 at 188.

[179] Third Airlines Case, above n152 at 530 (Murphy J).

[180] Id at 530.

[181] Zines, above n8 at 77.

[182] Geoffrey Sawer, Australian Federalism in the Courts (1967) at 206. See also Mason, ‘The Australian Constitution’, above n51 at 756.

[183] See discussion above Part (I); Engineers Case, above n171; Tasmanian Dam Case, above n66; Cole v Whitfield, above n9; Industrial Relations Act Case, above n2.

[184] Dawson J explained his opposition to this approach in the Industrial Relations Act Case, above n2 at 464–6.

[185] R v Lambert; Ex parte Plummer [1980] HCA 52; (1980) 146 CLR 447 at 465 (Mason J).

[186] R v Public Vehicles Licensing Appeal Tribunal (Tas); Ex parte Australian National Airways Pty Ltd [1964] HCA 15; (1964) 113 CLR 207 at 225; Industrial Relations Act Case, above n2 at 485. See also Jumbunna Coal Mine v Victorian Coal Miners’ Association (1908) 6 CLR 309 at 367–8; Nationwide News Pty Ltd v Wills [1992] HCA 46; (1992) 177 CLR 1.

[187] Industrial Relations Act Case, above n2 at 485 (Brennan CJ, Toohey, Gaudron, McHugh & Gummow JJ).

[188] Tasmanian Dam Case, above n66 at 221 (Brennan J).

[189] Lord Wedderburn, Max Rood, Gerard Lyon-Caen, Wolfgang Daubler & Paul van Der Heijden, Labour Law in the Post-Industrial Era (1994); Munck, above n7; Gilles Saint-Paul, The Political Economy of Labour Market Institutions (2000).

[190] Tasmanian Dam Case, above n66 at 221 (Brennan J). This statement was explicitly affirmed by the majority in the Industrial Relations Act Case, above n2 at 485.

[191] See further Mason, ‘The Australian Constitution’, above n51 at 756.

[192] See the comments of Murphy J in the Second Airlines Case, above n103.

[193] Cole v Whitfield, above n9. See generally Michael Coper, ‘Section 92 of the Australian Constitution since Cole v Whitfield’ in Hoong Phun Lee & George Winterton (eds), Australian Constitutional Perspectives (1992) at 129.

[194] Williams, above n8 at 130.

[195] Michael Coper, ‘Cole v Whitfield’ in Tony Blackshield, Michael Coper & George Williams, The Oxford Companion to the High Court of Australia (2001).

[196] Cole v Whitfield, above n9 at 398.

[197] Williams, above n8 at 130–131.

[198] See, for example, the individual rights conception in the Bank Nationalisation Case, above n56.

[199] Cole v Whitfield, above n9 at 399.

[200] Blackshield & Williams, above n59 at 653.

[201] Booker, Glass & Watt, above n63 at 48.

[202] See NLRA 29 USC s152(7) (definition of ‘affecting commerce’). The NLRA defines ‘affecting commerce’ as ‘in commerce, or burdening or obstructing commerce or the free flow of commerce, or having led or tending to lead to a labor dispute burdening or obstructing commerce or the free flow of commerce.’ See also JI Case Co v National Labor Relations Board [1944] USSC 39; (1944) 321 US 332 at 450.

[203] Menzies J in Redfern v Dunlop Rubber Australia Ltd [1964] HCA 9; (1964) 110 CLR 194 at 219-220; compare Fullagar J in O’Sullivan v Noarlunga Meat Ltd [1954] HCA 29; (1954) 92 CLR 565 at 598 (‘with respect to’ connotes all matters which may affect the subject matter of the power).

[204] The ‘Jones & Laughlin American test’ – see above n127.

[205] Constitution s51(xxxix); Grannall v Marrickville Margarine Pty Ltd [1955] HCA 6; (1955) 93 CLR 55 at 77 (Dixon CJ); see also Peter Hanks, Australian Constitutional Law: Materials and Commentary (5th ed, 1994) at 613.

[206] See text accompanying n182: the Court should not dissolve the two branches of intra- and inter- state commerce, but rather acknowledge that they are interconnected. It is the separation of the two that requires the fictitious formalism, not their ontological separability.

[207] A narrow construction of commerce could, for example, require a Commonwealth scheme to touch only those directly employed by businesses directly selling the majority of their product interstate.

[208] Redfern v Dunlop Rubber, above n203 at 219–20 (Menzies J). Compare Seaman’s Union v Utah Development Co, above n51 at 152, 154 (Mason J). [Emphasis added.]

[209] [2003] HCA 43 (7 August 2003) (hereinafter Maritime Union of Australia), see especially at [32]–[40].

[210] WR Act s5(3)(b).

[211] Maritime Union of Australia, above n209 at [36]. [Emphasis added.]

[212] Id at [30] and [36].

[213] See id at [37], citing Patterson v Bark Eudora [1903] USSC 164; (1903) 190 US 169; Strathearn Steamship Co Ltd v Dillon [1920] USSC 70; (1920) 252 US 348; Benz v Compania Naviera Hidalgo [1957] USSC 43; (1957) 353 US 138; McCulloch v Sociedad Nacional [1963] USSC 22; (1963) 372 US 10; all of which relate to the conditions of maritime workers on vessels engaged in commerce.

[214] See text accompanying n107–109 above (where I argue that the US jurisprudence is an appropriate interpretative model).

[215] See WR Act s5(3)(b)(i)–(iii).

[216] See Grain Pool of Western Australia v The Commonwealth (2000) 202 CLR 479 at 492; affirmed by the recent unanimous decision in Maritime Union of Australia, above n209 at [35].

[217] Ibid.

[218] Blackshield & Williams, above n59 at 652 (emphasis in original).

[219] Ibid.

[220] Maritime Union of Australia, above n209 at [35], citing Re Dingjan, above n83 at 369. [Emphasis added.]

[221] 29 USC s152(7) (definition of ‘affecting commerce’).

[222] 29 USC s203(b) (definition of ‘commerce’) and, for example, 29 USC s206(a)(2) (minimum wage).

[223] [1914] HCA 73; (1914) 19 CLR 298.

[224]Id at 329–330.

[225] Maritime Union of Australia, above n209 at [36].

[226] See above Part 3. ‘A Comparative Model: The United States Commerce Clause’.

[227] See WR Act s4(1).

[228] See WR Act s5.

[229] See WR Act s170CB(1)(d).

[230] See WR Act s5AA(3) and Pt VIB (certification by AIRC); s170VC(d)–(f) and Pt VID (approval by Employment Advocate).

[231] See R v Wright; Ex parte Waterside Workers’ Federation of Australia [1955] HCA 35; (1955) 93 CLR 528 at 539, 540 and 544 (Dixon CJ, McTiernan, Williams, Webb, Fullagar, Kitto & Taylor JJ); Seaman’s Union v Utah Development Co, above n51 at 137–139 (Gibbs J) & 152, 154 (Mason J). Although this is probably the correct result, it does illustrate something important about our conception of labour, I think, that judges so quickly conclude that labour, as a ‘resource’, is a part of a commercial process (as opposed to a part of society).

[232] See s170VA (‘constitutional trade and commerce’). Compare s127C(1)(b) (constitutional corporation) and discussion in Re Dingjan, above n83.

[233] Mason, ‘Minimalism, Monarchism or Metamorphism’, above n151 at 11.


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