The responsibility for education in Australia rests with the states. Teachers in the state of New South Wales, as in other Australian states, are employed by the Public Service Board, which determines working conditions. Teachers are administered, however, under the Department of Education. Labor disputes in Australia are settled not by formal negotiations but by compulsory arbitration by state and federal arbitration commissions. Nevertheless Australian teacher unions and other unions often strike, especially over grievances. There are several advantages of the system of compulsory arbitration. It promotes speedy settlement and national uniformity of wages and working conditions. Its penal sanctions also reduce the loss from long work stoppages. One disadvantage is that the system lacks formal means for resolving grievances. Under the system, teachers' salaries in New South Wales and throughout Australia have increased dramatically. One big problem, however, is that teachers and principals share the same union but do not always have the same interests. It is proposed that the split between teacher administration and hiring be remedied by the institution of a commissions employment agency handling both functions as well as representing management in labor disputes. Australia also might benefit from more formal provisions for collective negotiations. (Author/JM)