Re Bagshaw [1907]

Updated time

Last updated

10 January 2017

(1906) 1 CAR 122, O'Connor J, President, 6 June 1907

Summary

In this decision Justice O’Connor, President of the Arbitration Court, encouraged the employer and trade unions to try to reach an agreement on what constituted ‘fair and reasonable’ wages. The employer had applied for a Court order that it paid fair and reasonable wages, thus entitling it to the benefit of an exemption from Excise duties. The parties did reach agreement, and the agreement was for rates which approximated but were not identical to those set in the Harvester Decision. Harvester set a rate of 7 shillings a day for an unskilled labourer. In Bagshaw, a labourer used to trade would receive 7/6 (7 shillings and 6 pence), while a labourer not used to trade would receive 6/6. Tradesmen might receive less than the 10 shillings required by Harvester. The case is an illustration of the importance of the conciliation function. Most aspects of awards were agreed between the employer and unions concerned.

In this case, an application was made by an employer for an order that the wages paid in the employer’s factory were fair and reasonable. Such an order would exempt the company from certain taxes payable at the time. During argument, the President stated that:

It is becoming more and more evident that there must be some common basis fixed as to what is fair and reasonable. That must be fixed irrespective of whether individuals or individual manufacturers or workmen will approve of it or not. Therefore there are only two courses open — either I have got to fix it, and I would fix it on some uniform basis, or it has got to be fixed at a Conference between the workers and the employers. If it is fixed at a Conference like that I shall not find it necessary to do anything more than adopt the views they agree to. [p.124]

I have come to the conclusion that it would be much more satisfactory to both parties if the employers and the employees could arrange between themselves some uniform rates to be adopted in this industry. It is obvious that a method of that kind in settling the rates would be infinitely more satisfactory than the best settlement I could possibly arrive at. [pp.123–4]

The parties conferred and an agreement was ultimately reached. The President noted:

An agreement cannot be come to without recognition of the rights and obligations of both sides. The masters have properly recognised that the men have rights to fair remuneration. On the other hand, the men recognised that on the master rests the risk of the employment of capital and the energy and the brains and the experience which are required to make it reproductive, and which are required to maintain the wages fund out of which workmen are paid. [p.127]