The right of free contract is taken away from the worker, and he has been placed in a condition of servitude or status, and the employee must conform to that condition." Not only do judges have this power, but they have the option of applying or not applying it as they see fit, for the amendment of 1908 "expressly permits the court to refuse to make an award if for any reason it considers it desirable to do so." With a law, then, that in no way aids the unions, as such--however beneficial it may be at times to the individual workingman--and which leaves an arbitrary power in the hands of the judge elected by an agricultural majority, what has been the _concrete_ result?
Especially, what principles have been applied by the judges?
Of course the first principle has been that all the working people should get what is called a "minimum" or a "living" wage, but our authors show that merely to keep their heads above the sea of pauperism was not at all the goal of the workers of New Zealand.

No doubt they were already getting such a wage in that relatively new and prosperous country, yet this was all the new law did or could offer, besides keeping existing wage scales up to the rising cost of living.

Anything more would have required, not compulsory arbitration, but a series of revolutionary changes in the whole economic and political structure.
"Another stumbling block in the way of advance in wages is the inefficient or marginal or no-profit employer, who, hanging on the ragged edge of ruin, opposes the raising of wages on the ground that the slightest concession would plunge him into bankruptcy.

His protests have their effect on the Arbitration Court, which tries to do justice to all the parties and fears to make any change for fear of hurting somebody.
But the organized workers, caring nothing for the interests of any particular employer, demand improved conditions of labor, though the inefficient employer be eliminated and all production be carried on by a few capable employers doing business on a large scale and able to pay the highest wages." Here is the essential flaw in compulsory arbitration in competitive industries (its limitations under monopolies will be mentioned later).
The courts cannot apply a different standard to different employers.

On the other hand, they cannot fix a wage which any employer cannot afford to pay or which will drive him out of business.