Industrial Relations in Papua New Guinea

An industrial relations system, modeled on the Australian system, was introduced in the 1960s. The system required input from employer and employee organizations and the administration. The employer organizations and the administration were organized but most of the employees were not. The colonial Administration gave some advice to fledgling workers’ associations; some Australian trade unions and the Australian Council of Trade Unions gave assistance, especially to waterside workers, seamen and public servants. The 47 unions registered under the Industrial Organisations Ordinance between 1963 and Independence in 1975 were very small and mostly regionally based. Few held properly constituted elections or kept accurate records.

The situation did not change significantly after Independence. The most effective unions have been the Bougainville Mining Workers’ Union, Ok Tedi Mining Workers’ Union, the Waterside Workers’ and Seamens’ Union, the Teachers’ Union and the Public Employees’ Association. The Industrial Organisations Ordinance requires unions to register with the Department of Labour and Employment. About half of PNG’s 58 unions are members of the Papua New Guinea Trade Union Congress. Most major employers are members of the Employers’ Federation of Papua New Guinea. In 1992 wages were high and working conditions good in comparison with other developing countries. At Independence in 1975 PNG inherited an Australian style wage system which included overtime loadings and leave provisions not usually found in Third World countries. Between 1972 and 1975 real wages more than doubled.

Until 1992 PNG had a central wage fixing system. In 1992 the government accepted the Minumum Wages Board recommendation that, for new entrants to the work force, there should be a national minimum wage of K22.96 per week and variations in the minimum wage should be through direct negotiation between employers and employees. The change is expected to reduce wages.

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