Rudd risks law reform showdown with unions

CANBERRA - Prime Minister Kevin Rudd's Labor Government faces a widening rift with the union movement as both sides prepare for a showdown at next month's annual party conference.

Union anger at Rudd's refusal to buckle on further industrial reforms and to axe the despised construction industry watchdog established by former conservative Prime Minister John Howard saw the Government booed and jeered at last week's Australian Council of Trade Unions congress.

Yesterday their determination to take the fight to the ALP conference was hardened by the court appearance of Adelaide rigger Ark Tribe, who faces a fine of up to A$22,000 ($28,000) or six months' jail for refusing to attend a hearing of the Australian Building and Construction Commission.

Howard established the commission in 2002 after a royal commission found the industry was riddled with disregard for the law, and endowed it with wide coercive powers, including the power to demand attendance at its hearings.

Several hundred union members protested outside Elizabeth Magistrates Court as the matter was adjourned until August, and warned of repercussions - including a possible national strike - if Tribe were convicted.

"It's a shameful reflection on this Labor Government that an ordinary construction worker now faces the possibility of six months' imprisonment because the Government has not removed the most extreme laws left behind by John Howard," Martin O'Malley, state secretary of the Construction, Forestry, Mining and Energy Union, said.

Rudd won power in November 2007 promising to scrap Howard's anti-union industrial laws, and, with new legislation and other measures under way, has met most of his election commitments.

But while unions have welcomed the changes they want to roll back industrial policy even further, restoring much of the power and influence they enjoyed before a wave of reforms.

Even with a recent increase in numbers, unions represent only about 20 per cent of the workforce, and an even smaller proportion of private sector employees.

In a trend that began before Howard, the unions have also lost much of the grip they once held on the party and Labor policy.

Rudd does not intend handing back that power, and is facing union anger on fronts ranging from the decision to raise the retirement age by two years to 67, to demands for further reforms and anger at an apparent willingness to soften national pay conditions for vulnerable sectors of the economy.

Last week's ACTU congress gave a foretaste of what awaits the Government at Labor's annual conference.

Unions insisted on a new wave of reforms, and for an end to the Building and Construction Commission which it regards as both a symbol of Howard's loathed industrial laws, and as a breach of fundamental rights that treats building workers differently from those in any other sector.

Facing down union fury, Employment and Workplace Relations Minister Julia Gillard refused to bring forward the commission's demise or end its coercive powers.