Systems Theory, ‘Web or Rules’,
and the Fair Work Act
Dunlop’s Systems theory, key concept: functionalist or
structuralist perspectives of society
The macro-sociological, social system or order view of
Functionalism: nature and goals of a theory
Teleological - concerned with goals a system serves
Mathematical - co-variation between variables
Configurational - interdependence between elements of a
system; seeks to examine how and what each contributes to
DS theory based on works of Parsons (social system), which adopted
an inherent bias in favor of order and stability.
Dunlop: at any stage of its development, an industrial-relations system
has four elements:
i. Actors - the parties involved
ii. Contexts - nature of industrial relations differs from one context to
iii. Body/bodies of rule - governing the actors through ‘substantive and
procedural rules in the context
iv. Ideology - binding the various elements of an industrial-relations
Dunlop’s Systems theory
Actors defined based on product and labor markets, technology, and
distribution and/or balance of power in wider society
Key factor: implications on workplaces and individuals
Context defined by technology, budgetary and market factors, and
balance of power in society
Premise: the larger environment… shapes the conduct of and the rules
established by workers, employers and the state
Body of rules (Web of Rules) governs the workplace (context) and
interactions between people in it
Ideology: beliefs held by actors in a context, that integrate and/or bind
the system together as a single entity; must be “sufficiently consistent
or compatible to permit a common set of ideas which recognize an
acceptable role for each actor”
‘Web of Rules’
Governs relationship among other elements of industrial relations
Divided into substantive and procedural rules.
Substantive rules set and define terms and conditions of employment.
Procedural rules focus on procedures for resolving conflicts between
parties and interpretation of rules made in disagreement between
Other rules concern negotiations, management prerogatives, joint
consultations, as well as conditions of service.
Mainly made within the organization (internally) to guide the behavior
of the parties involved.
Substantive Rules of the Act
Basic mandatory obligations for employers, conditions under which a
person or institution is considered an employer.
Provides responsibilities of employers and employees within its
Rules on the minimum national employment standards -
minimum/maximum number of hours an employee can work in a
week, accompanying conditions, etc.
Base rate of pay – “rate of pay payable to the employee for his or her
ordinary hours of work”
Not including monetary allowances, loadings, penalty and/or overtime
rates and incentive-based bonuses and payments, etc.
Procedural Rules of the Act
Address issues on relationship between employers and
employees and/or between employer and employer.
Rules on ‘how’ to terminate employment and make an
‘unfair termination’ claim - reinstatement and/or
Termination must be made in writing, specifying date and
Employee required to make an ‘unfair dismissal’ claim
within 14 days of employment termination.
Procedural Rules of the Act
Settlement of small claims: provides capacity for employees
to pursue claims as little as less than $20,000
Others: ‘agreement making’ and ‘good faith bargaining’.
Collective Bargaining: where employees, employers, and
their representatives bargain over an enterprise agreement.
Good faith bargaining: all parties present – employer
permits good faith bargaining in agreement to negotiate or
initiate an enterprise agreement.
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