The Origins Of Arbitration

Prelude to Arbitration in Three Movements: Ulster, South Australia, New Zealand: 1890-1894 by W. J. Gardner (2009) 174pp. (Available from W. J. Gardner, Box 5634, Papanui, Christchurch 8542, $NZ30)

Published in Labour History Project, Newsletter 49 July 2010, p.25-27.

Keywords: Labour Studies; Political Economy & History;

The Industrial Conciliation and Arbitration Act, passed in 1894, has been an iconic part of New Zealand’s labour history. It was not repealed until 1973, its descendants regulated the labour market until the passing of the Employment Contracts Act, and its ghost haunted us thereafter.

There is a plethora of literature on it, but the standard reference of its early development is Jim Holt’s Compulsory Arbitration in New Zealand: The First Forty Years. The book really begins with the passing of the act, with acknowledgement that there had been earlier attempts by William Pember Reeves. (The practice is to call him Pember Reeves to distinguish him from his father, William Reeves, who was an MP in an earlier era.) Jim Gardner fills in this lacuna by a detailed consideration of the years that preceded it, also pointing out that there were earlier precursors outside New Zealand.

The first prelude is about Samuel de Cobain, a sad gentleman, sometimes described as a ‘slum landlord’, who held the Westminster parliament seat of Belfast from 1886 to 1892 (when he was expelled from the House of Commons, after fleeing to France following being found in a men’s brothel). In 1890 he introduced a bill ‘Strikes’ or more lengthily ‘for Dealing with Strikes among Workmen, and remedying some of the Evils of the Sweating system’.  Gardner suggests that it was the idea of an inspector of factories, J. H. Cameron, and that de Cobain proposed it as much for a political end – to demonstrate activity to his electorate – as belief. De Cobain does not seem to have consulted any employers or unions so there was no groundswell of favourable opinion. The Bill was opposed by the Trade Union Congress, and withdrawn.

The bill and its Ulsterman sponsor are almost forgotten until Gardner’s book, and probably had no impact on Australasia. However its existence  is indicative that something was going on. For instance, American Joseph D. Weeks published Labour Differences and their Settlement: A Plea for Arbitration and Conciliation in 1886. The American Knights of Labour who supported those objectives, came to New Zealand from 1887. What seems to have been happening – it is largely outside the scope of Gardner’s book, although he discusses social developments in the each of the localities he addresses – is that unionism was evolving. There was the ‘New Unionism’ which was recruiting unskilled, and semiskilled workers and from the white collar sector, including women. Industrial disputes intensified including the London Dock Strike of 1889 and Australasia’s (Great) Maritime Strike of 1890. Many loathed these conflicts, thought them inefficient but inevitable in current market arrangements, and sought alternative means of resolution to industrial tensions.

The second prelude describes the course of the first Australasian bill, proposed in 1890 to the South Australian parliament by Charles Cameron Kingston, who later become its premier and was deeply involved in the founding of the federation of states which became Australia, which has arbitration and conciliation provisions in its constitution. Reeves was to acknowledge this precedence, although the South Australian legislation was finally passed after New Zealand’s. (In those days the government did not have a guaranteed majority, so ministers would introduce bills which were not passed because they did not have sufficient support in the lower house or were rejected in the upper house.)

Gardner sketches the social conditions at the time; South Australia, a Wakefield colony, was the state most similar to New Zealand and had also experienced collateral damage – ‘the victim of other colonies’ quarrels’ – from the Maritime Strike, the bill being introduced shortly after it collapsed in October, and the totla defeat of the unions that made up the Maritime Council.

With the distance that time gives, the New Zealand end of the strike was bound to fail. Bert Roth thinks that there were about 3000 unionists in 1888. Estimates are as high as 63,000 at the end of 1890. In my view the true figure was lower but, whatever, the new union members were hardly ready for New Zealand’s first major industrial confrontation. It is possible that the employers deliberately precipitated the strike to quell the new unionism.

Was the consequence the arrival of arbitrationism? Months after the collapse New Zealand elected the Liberals, a loose coalition of self employed and working men, whose government was to enact the I&C Act.

The arithmetic of the election is complicated. Universal male suffrage (over the age of 21) had been introduced for the 1881 election, but the principle of one-man-one-vote was first applied in 1890 – previously property owners had been allowed to vote in each electorate where they had a holding. (On the other hand, the country quota meant it was one- man-1.28-votes for rural males.) The one-man-one-vote principle may have eliminated over 30,000 multiple registrations, presumably mainly to the cost of the property oriented right-wing vote. Additionally, turnout was about 20 percentage points greater in 1890 compared to 1887, say another 35,000 votes in an enrollment of 180,000. The additional voters presumably voted against the conservatives who had run the country in the previous three (or thirty) years. It would be fascinating to know how many of the new voters turned out because of the Maritime Strike, but we never will.

The Strike is largely forgotten – except to celebrate Labour Day, although even here most people dont know why they have that Monday off. Instead of celebrating International Workers Day on May 1, New Zealand chose the last Monday of October, commemorating the day the Council was founded, 28 October 1889. The unions chose the founding date of their Council to coincide with the anniversary of the legendary 1840 meeting in Barrett’s Pub when the working men declared that anyone who did not observe an eight-hour day would be ducked in Wellington harbour. (There will be a Labour History Conference on the Maritime Strike on November 4 this year, in Auckland.)

Gardner argues that the failure of the Maritime Council shaped the subsequent labour legislation. He writes the New Zealand story around two major actors  Reeves and John Andrew Millar, a Christian Socialist and ‘radical’, who was secretary of the Council and is described by Gardner as ‘the most unusual labour leader in New Zealand history’. As it happens  Reeves was elected to parliament in 1887, and was a minister from 1890 resigning to become Agent-General (effectively High Commissioner) in London in 1896. Despite standing in 1890, Millar was not elected until 1893, and so it was that Reeves made the legislative running. (He also has the advantage of a major biography by Keith Sinclair.)

The book argues that Reeves and Millar disagreed. The evidence is indirect but convincing enough. Millar did not mention Reeves’s proposals when he had the opportunity to, shortly after he was elected in 1893, and he did not vote for the bill. In a satirical verse written in 1895, Reeves couples ‘Jock’ Millar with ‘Geordie’ McLean, that is George McLean the Chairman of the failing Colonial Bank about whom Reeves was sceptical when it came to bailing it out. Gardner suggests that since Reeves was a Canterbury man, while Millar came from Dunedin so there was a tension between the representatives of the two major industrial regions.

With the telescope of time, one is struck by their similarities. Neither were Marxists, but both saw strikes as an inevitable curse in the jungle of unregulated capitalism. The difference, Gardner argues, is that Millar believed in social not political action, ‘Whereas Millar looked to voluntary developments in society rising to a climax, Reeves aim was political, imposing a compulsory solution on industry from above.’ In Gardner’s view ‘There could be no compromise between the two views’. We have here the tension riven through the union movement and labour history. Could the unions evolve organically to protect all workers, or were there some workers who would never be able to protect themselves without state help? Practically, what was to be the balance between these two approaches?

Perhaps the balance issue is key to our understanding how, and ironically, Millar who became Minister of Labour in 1906, rescued the arbitration system in 1908 by amending the Act to make it workable. In 1912 Millar crossed the floor and voted in the Massey government, retiring to the Legislative Chamber in 1914.

Gardner presents this as a modest monograph but like some of his earlier works – one thinks especially of A Pastoral Kingdom Divided : Cheviot, 1889-94 (1992), which led to a reevaluation of the ‘bursting’ of the great estates – it raises major questions. Despite Bert Roth’s sterling work, and the contributions of others, we dont know enough about the labour history of the years before the IC&A Act and how they shaped the outcome (recalling that it was the unions who had not been weakened by a great industrial conflict who blocked the Westminster predecessor). As the three cameos of the book indicate, we need to see the New Zealand union movement as a part of international phenomenon. And we need to think more rigorously about the tension that Gardner captures in the differences between Millar and Reeves.

Gardner apologises that a book begun forty years ago should leave some loose ends but ‘it has become more important for me to publish than be perfect’. There are few books published by a 93 year old scholar which have so much useful material and intriguing insights.

I have a friend, who reviewing Gardner’s collected essays Where They Lived : Studies in Local, Regional and Social History (1999) published when he was a stripling of 83 and, thinking it was his last book, took the opportunity to acknowledge the author ‘s numerous contributions to history over the year. Jim, all I can say my friend was happily wrong in one respect. Certainly you deserve to be saluted and thanked, but that wasnt your last. If this is, you have finished with another blaze of glory but, then again, perhaps you are working on another project. You have certainly helped us in our work.