BRUCEHEARNMACKINNON*
T
he year 2003 was characterised by employer proactivism, and a preparedness to pursue new legal manoeuvres to prevent or terminate protected industrial action. A number of employers also resorted to lengthy lockouts (with few positive results) as bargaining tactics in enterprise negotiations. It was the year employers in the manu-facturing and metals sector saw off the unions’ ‘Campaign 2003’, giving little ground on the key issues of reduced hours and contributions to trust funds for worker entitlements. The year was a joyous one for employers in the building and construction industry, as their dreams of a shackled and weakened union movement came a step closer to being realised, with the introduction of draconian industry-specific legislation by the Howard Government, arising from the recommendations of the Cole Royal Commission. On a positive note, the year also witnessed all the members of the ‘industrial relations club’ embrace and declare a common concern for work and family balance issues.INTRODUCTION
Undertaking a review of employers and industrial relations has always been problematic for a number of reasons. First, the nature of employment organis-ations (i.e. firms) is such that industrial relorganis-ations is simply a means to an end. If employers could get by without having to concern themselves with industrial relations matters, then they most assuredly would. This is the complete opposite case to that of unions, which are formed for the very purpose of engaging in industrial relations; it’s their raison d’atre. If indeed we inhabited a truly unitarist world, where workplace conflict ceased to exist, then unions would also cease to exist. Thus, industrial relations is the very stuff of unions, yet it is very much a secondary concern for employers.
Even at the organisational level, employer associations have rarely, if ever, had an exclusive industrial relations focus. More often, their concerns encompass political lobbying, commerce and trade promotions, supporting industry training and providing an information service to their members. Traditionally, this journal’s review of employer matters has focused on the activities and attitudes of some of the key employer associations. I see no reason to resile from that approach. However, this review will also examine a few key industrial disputes, focussing on the role of the individual employers in each case, in addition to any involvement of employer associations. In doing so, the disputes analysed have been arbitrarily selected, based on my own interests and an attempt to cover disputes in different parts of the country, and trying to select those most likely to have an impact on the broader industrial relations landscape.
Specifically, this review examines employer responses to Campaign 2003 in the manufacturing and metals industry, the Australian Industrial Relations Commission (the Commission)’s annual safety net review, employer positions with regard to the Australian Council of Trade Union (ACTU)’s redundancy test case and its work and family test case, and importantly, employer responses to the Cole Royal Commission into the building and construction industry. In addition, this review discusses the Grocon/Construction Forestry Mining and Energy Union (CFMEU) dispute in Victoria, developments at Hamersley Iron in the Pilbara region of Western Australia, Rio Tinto’s ongoing dispute involving sacked mineworkers from its Blair Athol mine in central Queensland, as well as the Geelong Wool Combing lockout in Victoria.
While 2003 represented the eighth year in federal office of the Howard Government, 1 January represented six years since the Workplace Relations Act 1996 (Cwlth) (WR Act) came into operation on 1 January 1997. The year 2003 also represented 10 years since the former Labor Government initiated the shift towards enterprise bargaining, with its Industrial Relations Reform Act 1993(Cwlth).Thus, it has been a decade since Australia’s industrial relations system effectively ended its reliance on centralised industry-wide bargaining, first through the Labor Government’s ‘managed decentralism’, and for most of the period under the more radical workplace and individually focussed WR Act.
As the industrial relations system has become more decentralised, the role of employers and their associations has evolved and adapted to the changed environ-ment. Just as unions have had to adapt to a system increasingly focussed on enter-prise bargaining and individual agreement making, so too have employers and their associations. With large-scale industry-wide bargaining virtually non-existent, large employers have had to become much more self reliant, and less in need of the ‘solidaristic’ features of employer associations. On the other hand, the impact of enterprise bargaining has arguably been to increase the reliance of small to medium employers on the advice, expertise, and general support provided by their associations. These trends, which have been growing for several years, continued to impact on the roles and activities of employers and their associations in 2003.
CAMPAIGN2003
The year 2003 witnessed the Australian Industry Group (AiG) strongly resist the metals and manufacturing unions’—led by the Australian Manufacturing Workers Union (AMWU)— triennial enterprise bargaining agenda, conducted under the banner of Campaign 2003. Though there were some differences— geographically and sectorally—in their demands, the unions were broadly pursuing an 18 per cent pay rise over three years, a 36-hour week and trust fund contributions of worker’s accrued entitlements. While many firms seemed willing to bargain on the wages issue, the AiG mounted a determined campaign against the hours and trust fund component of the unions’ demands.
In early February the AiG called meetings of its members nationwide, to arm them with information on how to resist pattern bargaining and instead negotiate ‘genuine’ enterprise deals. The meetings on 5 and 6 February attracted 320 companies in Melbourne, 70 in Sydney and 50 in Brisbane. Whereas the unions grabbed the initiative in their Campaign 2000 claim, and swiftly gathered momentum as key companies reached agreements with the unions, 2003 witnessed a far better prepared and more determined employer response.
One of the AiG’s tactics in opposing the unions’ campaign was to lobby its members against attending company information meetings conducted by the unions. The AiG was also active on the legal front, pursuing all options to con-strain union industrial action. The AiG demonstrated its willingness and pre-paredness to explore various provisions of s. 170MW of the WR Act to argue before the Commission to suspend or terminate the unions’ bargaining periods. The AiG’s Director Workplace Relations, commented that:
. . . we explored every possible option under the Workplace Relations Act, to assist members . . . [and] . . . there were some interesting outcomes when the Commission used its powers to issue orders over industrial action . . . [which were] . . . not seriously challenged by the unions.
Commenting on the Commission’s new use of its general powers, he stated that the role the Commission played last year, particularly in Victoria, was excellent.1
Some three months into the union’s industrial campaign, the AiG’s Industrial Relations Director, Steve Smith, stated that more employers than ever were negotiating non-union s. 170LK agreements.2In fact, the AiG claimed that by
the middle of the year nearly one in three manufacturing agreements finalised in the enterprise bargaining 2003 round had been done on the basis of s. 170LK non-union agreements.3
By September, despite the unions achieving agreements in contracting, construction, petrochemicals and the power industry, Dave Oliver, the Victorian Secretary of the AMWU, acknowledged that the AiG had been somewhat successful in the mainstream metals industry in resisting the unions’ shorter hours and trust contributions components of Campaign 2003’s claim.4
unions’ Campaign 2003. He stated that a lot of lessons had been learnt from Campaign 2000, and so ‘this time we started very early, as far back as August 2002, organising meetings of our members’. Of note also, was the AiG’s assessment of the union strategy of using common expiry dates of agreements as a means of creating a critical mass to pursue pattern bargaining. Nolan commented that
if it fails then the unions are confronted with a huge resources problem. If you don’t achieve your objectives, you have workers at 700 establishments seeking assistance at the same time.5
He credited this issue as one factor which contributed to the rise in the making of non-union s. 170LK agreements in the manufacturing sector in 2003.
In August 2003 the AiG announced that Bob Herbert, who had been with the organisation for 43 years, and its chief executive since 1996, would be standing down from his position in early 2004, and replaced by his deputy, Heather Ridout. This change of leadership is not expected to result in any major change in direction for the AiG, Ridout having been Herbert’s deputy since 2001, and with the AiG and its predecessor the Metal Trades Industry Association (MTIA), for 25 years.6
SAFETY NET REVIEW
The now national wage case or Safety Net Review began with the members of the ‘IR club’ adopting fairly predictable positions. In response to the ACTU’s claim for a $24.60-a-week increase in wages for low paid workers, the Australian Chamber of Commerce and Industry (ACCI) argued for no increase at all, the AiG supported an $11 increase, and the (then) Workplace Relations Minister, Tony Abbott, supported a $12 wage increase.
The ACCI, having the broadest membership base of all the employer associ-ations, argued that the economic, industrial and geopolitical circumstances in 2003 were different from those faced by the country in 2002. Specifically, it argued that the ‘prolonged and severe’ drought and other economic challenges, such as the global economy and the threat (well founded, as it eventuated) of a new war in the gulf, were all factors which required a very different decision to by the Commission than the $18 it awarded in the 2002 Living Wage Case.7
Furthermore, they argued that the ACTU’s claim was based on a false premise, that annual increases should be made to award pay rates. The ACCI was sup-ported in their ‘no increase’ submission by the National Farmers Federation (NFF), which based its argument primarily on the economic effects of the drought.
The AiG supported a moderate increase of $11 for the low paid, but pointed out that one effect of such an increase would be to further compress relativities, but not to the point where they would be unworkable.8 They urged the
provide little extra benefit after extra tax and the loss of welfare support was taken into account. Nevertheless, they argued that a moderate increase was appropriate, notwithstanding the uncertain economic conditions, the drought, the possibility of war in Iraq, the appreciating Australian dollar, and weak global economic conditions.
Not surprisingly, the Commission awarded a compromise increase of $15–17-a-week, slightly less than the $18 increase awarded in its 2002 decision. Workers earning up to $731.80-a-week received a $17 increase, while workers earning above that got a $15 a week increase.9In handing down
its decision, the Commission recommended that the federal government conduct an authoritative survey on the employment effects of safety net adjustments in Australia. The AiG had, in its submission, urged the Commission to conduct a ‘comprehensive independent survey’ on the overall effects of safety net adjustments.
On 14 November 2003, the ACTU announced that it would be pursuing a $26.60-a-week wage rise in its 2004 safety net claim. Employers responded in the usual manner, with the ACCI’s Director of Workplace Policy, Peter Anderson, calling the claim ‘excessive and poorly targetted’. Arguing that such an increase would raise award rates at the top end to over $1000 a week, he said that this was ‘hardly a case of protecting the low paid’.10The more things change,
the more things stay the same!
REDUNDANCY TEST CASE
In May 2003 the Commission began hearing the ACTU’s redundancy test case, the first attempt to raise the redundancy safety net since the landmark 1984 Termination and Redundancy Test Case decision. In its application the ACTU sought to:
• increase maximum severance payments from 8 weeks after 4 years to 16 weeks after 6 years service;
• add up to an extra 4 weeks severance pay for workers aged 45 or over;
• delete the exemption from paying redundancy payments for employers with 15 or fewer employees; and
• extend redundancy entitlements to regular casuals.
The ACCI told the Commission full bench that the ACTU’s claim would impose massive costs that would discourage essential business restructuring. Granting the ACTU’s claim would increase the average payout by 300 per cent for small to medium firms, and represent a ‘massive kick in the guts’ for employers seeking to restructure.11
The main thrust of the AiG’s response to the ACTU’s claim was that the Commission, rather than increase redundancy entitlements, should encourage a policy of ‘corporate rescue’ embodied in insolvency law and recognise that redundancy provisions can impede or even destroy the process of voluntary administration.12The AiG asked the full bench to distinguish between
WORK AND FAMILY TEST CASE
Employer groups were also active in trying to seize the initiative in relation to the ACTU’s work and family test case. After several months of publicly canvassing their claim, in June 2003 the ACTU formally lodged its work and family test case with the Commission (ACTU 2003). The test case seeks to:
• establish an employees’ right to request variations in hours, obliging employ-ers not to unnecessarily refuse such requests to change hours, start and finish times and place of work;
• extend unpaid parental leave from 12 to 24 months, and allow for further exten-sions by consent until the child reaches school age;
• establish a right for full-time workers returning from parental leave to return to work part-time until the child reaches school age;
• require employers to consult with employees about any significant change while they are on parental leave;
• enable workers to purchase extra leave; and
• provide employees with the right to unpaid emergency leave for family emergencies.
Employer groups were quick to appear conciliatory, with ACCI Workplace Policy Director Peter Anderson stating that while there were aspects of the ACTU’s claim that employers couldn’t agree to, they were not ‘absolutely opposed to sensible change that improves work/family balance’.13He went on
to state that employers were willing to negotiate for greater access to part-time work. Two months later employer groups made formal responses to the ACTU’s claims.
The AiG responded by proposing to provide employees with more flexible annual leave provisions, including options to:
• buy up to six weeks additional annual leave;
• double annual leave by taking it on half pay; and
• forgo their annual leave loading in return for a proportionately longer period of leave.
They also offered increased flexibility in long-service arrangements, as well as proposing that award variations include new access to job-share arrangements and more flexible hours of work. AiG chief executive, Bob Herbert, stated that work and family balance was becoming ‘an increasingly significant issue’ for employers.14 The fundamental point of difference
between the ACTU’s claims and the position of the AiG was clearly expressed by the AiG’s, Peter Nolan, who in an interview for this review, explained that ‘whereas the ACTU’s claim is all about creating new award rights, our position is that the best place to determine such matters is through negotiation between employers and employees at the workplace’.15
A similar theme was adopted by the Business Council of Australia (BCA) upon the release of survey results of 68 member companies. The BCA announced that its survey of work and family issues shows that ‘one-size-fits-all prescription is not needed’.17The BCA declared that its survey revealed that its members ‘have
in place a range of strategies, policies and arrangements that actively assist parents’ to manage their caring responsibilities (Workplace Express,2 October). With Hugh Morgan, formerly of the Western Mining Corporation (WMC), taking over as President in 2004, it will provide an opportunity for the work/ family issue to be put on the agenda for the BCA’s work program for 2004.
Putting the unions somewhat on the back foot, the Master Builders Association (MBA) and the National Electrical Contractors Association (NECA) applied to vary the national construction and electrical contracting awards by joining them to the main test case. No doubt, employers in the construction industry view the opening up of the industry to part-time and more casualised work would weaken the unions’ current stranglehold over the workforce.
On 18 December, Commission President Giudice referred all union and employer applications in the work and family test case to the same full bench. Developments in 2004 will reveal the outcome of this important test case, but what is already apparent is that the unions’ attempt to extend workers’ rights has provided an opportunity for employers to advance further the spread of part-time and casual employment.
COLEROYALCOMMISSION
The Cole Royal Commission into the building and construction industry, which conducted most of its hearings the previous year, handed down its findings in a 13volume report on 26 March. It found that 23 union officials and eight employers or employer organisations might have committed criminal offences. Most of the offences were alleged to have occurred in Western Australia and Victoria. In hearings and submissions to the Cole Commission, employer groups, particularly the MBA and the AiG, complained heavily about the behaviour and practices of the building unions and their officials. The general theme running through their submissions was the need to enforce the ‘rule of law’ in an industry where ‘coercive’ monopolistic union power was out of control. Generally, the employers and their associations found a very receptive ear in Commissioner Cole.
The MBA’s Richard Calver, who joined the MBA on 3 March 2003—directly from his previous position as Workplace Relations Minister Tony Abbott’s senior policy advisor—said that it was now up to state authorities to take the criminal findings seriously and move to stamp out criminal behaviour in the industry.18
He said that moving on criminal behaviour had to be the ‘flagship of reform’ flowing from the Cole report. The major obstacle to pursuing criminal charges however, was the fact that in 2003, all State and Territory Governments were in Labor hands, and obviously unwilling to assist ministers Abbott and Andrews in their anti-union crusade.
opponents regard the CFMEU as an example of the ‘loony left’, then conversely, the H.R. Nicholls Society is regarded by many as representing the ‘ratbag right’. In May 2003, William Harnisch, the MBA’s chief executive, addressed the H.R. Nicholls Society’s XXIVth conference in Perth, to outline the MBA’s response to the Cole Commission’s recommendations.
Harnisch made it very clear that his organisation wanted less conciliation and more policing and enforcement of the law as the means to provide greater stability and certainty to investors in the building and construction industry. His speech—which was remarkable in its total absence of any consideration of the underlying causes of friction and conflict in the building and construction industry—focussed almost exclusively on restoring the ‘rule of law’. In advancing this argument, Harnisch was glowing in his praise for the work of Commissioner Cole. With almost religious fervour, Harnisch, in supporting Cole, declared:
. . . all citizens condemn unlawfulness . . . criminality and general lawlessness are morally objectionable . . . unlawful behaviour as common practice cannot be countenanced . . . the source of the industry’s real problem is criminal and unlawful behaviour that undermines the moral fibre of the industry, is un-Australian and, at a practical level, affects investment and productivity.19
The MBA’s delight at the recommendations of the Cole Commission was made clear when Harnisch stated that ‘Cole was realistic in his assessment of the commercial vulnerability of the industry [and] was right in his isolation of the source of union coercive power’. He explained how Cole’s recommendations, if implemented, would greatly shift the balance of bargaining power away from unions and towards employers by declaring that ‘the new order envisaged by Cole will better enable employers to resist illegitimate tactics used to force issues such as the implementation of the 36-hour week’. Commenting on the building and construction industry-specific legislation recommended by Cole, the MBA could not have been more supportive of the proposals, as Harnisch declared
[T]he statutory authority, provisionally called the Australian Building and Construction Commission (ABCC), will have wide powers to help thwart those who want to break the law. This is exactly the outcome that the MBA argued for in its submission to the Cole inquiry.20
Harnisch went on to warn that the months ahead would require intense political lobbying by employer groups for the Cole reforms to be passed by the Senate. With 2003 lying in the middle of the electoral cycle, employer groups like the MBA were well aware that if important legislative reforms were to be enacted, then by early 2004 the window of opportunity would in all likelihood be almost closed.
than 10 employees should still be required to hold secret ballots before initiating protected industrial action. Revealing the MBA’s preference for allowing employers to unilaterally determine wages and conditions, Harnisch also called for the removal of the requirement in Recommendation 8 of the Cole report, that enterprise bargaining take place: ‘the idea of freedom of choice also meant that employers and employees should be free to choose not to bargain’.22
The attitude of employers to the Cole Commission’s recommendations made it clear that employers were not interested in deregulation, which had been the rhetoric of their reform agenda when the Howard government came to office. Deregulation is supported by employers in areas of the economy where organised labour is weak and the balance of power greatly favours capital, but where union organisation is strong, powerful doses of regulation and enforcement are required. Hence, the support for the industry-specific legislation contained in the Building and Construction Industry Improvement (BCII) Bill. So much for employer oppo-sition to ‘third party interference’. Discussing the likely effect the Bill could have on the CFMEU, Anthony Forsyth, an ANU law lecturer, stated that the proposed restrictions in the Bill and ensuing regulations on protected industrial relations would ‘almost completely close the window for lawful industrial action.23
The AiG, while supportive of the Bill overall, was concerned that the BCII Bill’s definition of the construction industry was too broad, which could make it easier for unions to extend construction terms and conditions of employment to other industries. Furthermore, it could also open up opportunities for construction unions, chiefly the CFMEU, to extend their coverage to other industries. The AiG’s position was at odds with the Australian Chamber of Commerce and Industry (ACCI) which supported a broader definition of the industry as a means of constraining unions in as broad as possible area—with the exception of the housing sector, which is virtually non-unionised anyway.
When the government finally introduced its BCII Bill, the AiG’s concerns had largely been incorporated. Whether the Bill eventually becomes enacted, will depend on the Bill negotiating a hostile Senate in 2004. At the time of writing, the Labor Party’s electoral prospects had improved significantly following the promotion to leader of Mark Latham, thus reducing the likelihood of the Howard Government using possible Senate blocking—which, in any case, have to happen twice—of the BCII Bill as a trigger for a double dissolution of the Commonwealth Parliament.
GROCON
The year 2003 began with the unravelling of Grocon’s bold attempt to de-unionise it’s Victorian building and construction operations. Having announced its inten-tion to offer a non-union s. 170LK agreement to its workforce in November 2002, the company was forced to back away from its aggressive agenda following the workforce’s overwhelming rejection, by secret ballot, of the company’s proposal on 5 December.
employer, and rather unique among construction companies in that it directly employed a large workforce of around 650, rather than relying on subcontractors. Much like CRA, 10 years earlier, which had been considered a ‘union friendly’ company, this about-face, seemed to catch the unions unawares.
With Bruno Grollo, the patriarch and former head of the family company, now in retirement, his son and Grocon Director, Daniel Grollo, was apparently keen to make a statement about his approach to industrial relations in the construction industry. The more hardline industrial relations position adopted by the company also coincided with it adopting the law firm Freehills and senior counsel Ian Douglas, to run its legal strategy. Earlier in 2002, the firm also recruited former BLF official and CFMEU (Federated Engine Drivers and Fireman’s Association [FEDFA] Division) Victorian Branch Secretary, John van Camp as its industrial relations director.
Daniel Grollo signalled a more adversarial approach to company–union relations when he told a property council lunch in Melbourne that
Grocon had let poor work practices become entrenched in the company’s operations, but now the game is up. Grocon is now firmly focussed on rooting out the work practices we believe are unacceptable.24
The deteriorating relationship between Grocon and the unions—primarily the CFMEU—seems to have gathered momentum following Grocon’s submission to the Cole Royal Commission into the building and construction industry, which was quite critical of the unions and alleged that union officials had used intimidation against Grocon managers.
At any rate, the failure of the company to secure worker support for its non-union agreement meant that the year 2003 began with Grocon-non-union relations in limbo. Aware now, if not before, that ‘on the ground’ the union was firmly entrenched amongst the workforce, Grocon proceeded to pursue a legalistic route to achieve its desired changes to workplace conditions and work practices. Trying to achieve through the courts and the Commission what it couldn’t achieve ‘on the job’, Grocon sought to get protected industrial action declared unlawful via the issuing of a s. 166A certificate.25
On 21 January, Daniel Grollo and CFMEU Victorian Branch Secretary, Martin Kingham, issued a joint statement declaring that the company had agreed to adjourn its legal action against the unions and its officials, while the union had suspended planned industrial action. However, this apparent truce was put in doubt in early February when all major construction sites in Melbourne were affected by industrial action as building workers rallied in support of CFMEU State Secretary, Martin Kingham, when he appeared before the Magistrates Court over his refusal to hand over summoned union documents to the Cole Royal Commission. The rally closed Grocon sites, which the company claimed was a breach of the peace pact, as the union had promised not to take further industrial action.
by re-imposing its previous work bans and planned industrial action on all of Grocon’s sites. However, this sudden show of force by both parties convinced both the company and union to strike a peace deal later that same day.26
Throughout the dispute, the federal Minister for Workplace Relations, Tony Abbott, applauded Grocon’s attempt to bypass the unions, in much the same way that former Minister Peter Reith did during the epic waterfront dispute in 1998. At one stage however, the peace deal was jeopardised by the intervention of Abbott, who appealed against a decision of the Commission to refuse certification of the one non-union deal which Grocon had reached with two of its management employees. Ultimately, the Commission rejected Minister Abbott’s appeal.27
The Commission found that Grocon had put its s. 170LK offer to employees under five different company names, but that employees were not aware that their colleagues’ designated employers were different, and that they were voting on different deals. The strategy of Grocon management, like Patricks in 1998, was based on legalistic intrigue, rather than a serious attempt to win over the ‘hearts and minds’ of its workforce. This is why the de-unionising attempt failed.
In September, renewed industrial unrest broke out at Grocon’s largest project, the MCG development site, over the terms of a site agreement. By 17 November however—almost 12 months since Grocon had attempted to by-pass the unions—an agreement was certified by the Commission, effectively ending all outstanding disputes between the company and the unions.28 For the time
being at least, Grocon seems to have withdrawn from the Howard Government’s ‘coalition of the willing’ in its war on [union] terror, and seems to be more concerned with keeping its major projects on schedule.
HAMERSLEY IRON
Some 10 years after Rio Tinto (then CRA) executed a stunning de-unionisation strategy at its Hamersley Iron mines in the remote Pilbara region of Western Australia, foreshadowing the de-unionisation of their other metalliferous and aluminium smelting operations, 2003 witnessed a number of twists in the continuing efforts of unions to regain a foothold in this once 100 per cent unionised region.
Rio Tinto management have long demonstrated an ability to introduce and maintain predominantly non-unionised workplaces, whether operating under the former Labor Government’s Industrial Relations Reform Act 1993using Enterprise Flexibility Agreements, the Workplace Relations Act using Australian Workplace Agreements (AWAs), or the former Western Australian Government’s individual Workplace Agreements.
decade, its largely non-union workforces at Hamersley iron, Dampier Salt and Argyle Diamonds overwhelmingly voted down the company’s proposal.29
The union movement interpreted these results as evidence of a need for renewed union organisation at Hamersley. However, in an attempt to avoid the debilitating demarcation conflicts between the Australian Workers Union (AWU) and the CFMEU, as well as to respond to the apparent local community wishes for a more grassroots form of unionism, the ACTU launched a unique organising campaign, based around a new union body, the Pilbara Mineworkers Union (PMU).30
Rio Tinto management at Hamersley, having had their s. 170 LK proposals rejected, decided to offer AWAs to its workforce instead, as a means of shifting from the state jurisdiction to the federal sphere, under the WR Act. By early 2003, all but around 10 per cent of Hamersley’s 2000-odd workforce had signed AWAs. However, as the new Western Australian industrial relations regime provides for arbitrated enterprise orders when bargaining negotiations become deadlocked, the union’s saw this as an opportunity to improve the pay and conditions of the ten per cent of Hamersley’s workforce who had refused to sign the company’s AWAs.
While unions such as the CFMEU, AMWU and Communications Electrical and Plumbing Union (CEPU) were preparing to launch such a claim, Hamersley management were negotiating a consent Federal award with the AWU.31
Management had once again out-manoeuvred the unions. Under a Federal consent award, the workers would be entitled to a safety net, largely reflecting the work practices brought in under the Hamersley AWAs. Importantly for management however, it maintains the coverage rights for the relatively compliant AWU, while freezing out the more militant CFMEU.
The proposed consent Mining Industry Rio Tinto Iron Ore Award 2003 provides for non-AWA workers, at least initially, to move to the same pay and conditions as those on AWAs. The company also signed a memorandum of understanding (MOU) with the AWU, to apply at both Hamersley and at its nearby Robe River site. The MOU outlines organising rights and the union’s ability to represent members in the company’s fair treatment grievance handling process and streamlines induction for AWU officials visiting Rio Tinto sites.
The state unions frozen out of the Rio Tinto-AWU deal chose to continue with their pursuit of state-based orders, and at the time of writing were challenging the Commissions jurisdiction to register the federal consent award.
While the developments were significant, in that Rio Tinto management had agreed to a new award recognising union coverage, they had also successfully driven a wedge between the competing unions, guaranteeing that inter-union squabbles would continue for some time. It had also pulled the rug from under the fledgling community-based PMU, just as it was showing signs of gathering genuine rank-and-file support.32It is likely that Rio Tinto management will point
workers in the Pilbara. Only time will tell if such a judgement is proven to be well founded.
BLAIRATHOL
Meanwhile, at other Rio Tinto operations on the East Coast of Australia, indus-trial relations continued to take alternative courses. First, in 2003 the CFMEU and Rio Tinto successfully negotiated their second three-year certified agreement covering their once strife-ridden Hunter Valley mine.33
On another front however, hostilities continued between Rio Tinto’s subsidiary, Pacific Coal, and the CFMEU over the fate of 16 former Blair Athol mineworkers, sacked in 1998, at the peak of the battle between the company and the CFMEU in the coal industry. The Blair Athol mine in central Queensland was but one of a number of locations of intense struggle, as the company attempted to implement its de-unionising agenda throughout its coal operations in the late 1990s.34
Although in 2001 the Commission found that the company had conspired to make redundant a blacklist of union activists, and ordered their reinstatement, this decision was eventually overturned on appeal to the full bench of the Commission. In December 2002, though agreeing that a blacklist existed and that the 16 workers were unfairly dismissed, a full bench majority quashed the reinstatement order and awarded the sacked workers no compensation.35The
Commission’s peculiar rationale was that regardless of procedural fairness, the company had established a business case for cutting staff numbers.
However, in response to another application from the CFMEU, in July 2003 the Commission ruled that the 16 workers be given preference of employment at the company’s new Hail Creek mine nearby.36The new Hail Creek mine,
owned by Queensland Coal, a subsidiary of Rio Tinto, began recruiting workers in September 2002, but the 16 former Blair Athol workers all failed to get past the initial screening phase. The full bench found that the recruitment process at Hail Creek operated unfairly towards them. In fact, the bench found that the company’s own witnesses acknowledged that the former Blair Athol workers were treated differently to other job applicants.
This finding is consistent with the evidence uncovered at other Rio Tinto coal mines, in particular at Mount Thorley and the Hunter Valley No. 1 Mine, where management was found by the Commission to have discriminated against union activists in selecting workers for redundancy.37As has generally been the case in
the long running battle between the CFMEU and Rio Tinto in the coal industry, the company chose not to comply with the Commission’s decision but to appeal to the Federal Court for a stay of the Commission’s order. On 18 December 2003, a full bench of the Federal Court rejected the company’s application for a stay of the Commission’s order that the 16 workers be given preference of employ-ment at the Hail Creek mine. However, this was not the end of the dispute, for a federal Court hearing was scheduled for February 2004 to hear the company’s application to overturn the Commission’s order.
not capable of achieving realisable gains for their members, and that even when they do win grievance cases, they come at very significant costs. It also demon-strates that although certified agreements between Rio Tinto and the CFMEU now operate in the coal industry, these outcomes can only be considered truces in an ongoing war, which seems to have a long way to go before a clear victor is declared.
GEELONG WOOLCOMBING
The year 2003 also witnessed a number of lengthy lockouts, as some manu-facturing employers—such as the glass manufacturer ACI in Box Hill and the car components manufacturer FMP in Ballarat—sought to flex their own muscles during enterprise bargaining negotiations. However, one case in particular stands out as worthy of some analysis. On 28 April 2003, around 100 textile workers at the Geelong Wool Combing (GWC) factory found themselves locked out of their workplace on full pay, ahead of a protected lockout commencing five days later. Leigh Schmitt, managing director of BWK Holdings, GWC’s parent company, stated that the key issue in the dispute with the Textile Clothing and Footwear Union of Australia (TCFUA) was the company’s proposal to shift from a seven-day, 24-hour operation (three shifts a day), to a five-day, 24-hour operation as needed.38The company sought to make
this change without having to maintain the penalties built into the rates for working weekends and public holidays, but this was opposed by the union.
Against a background of drought-induced high wool prices and excess processing capacity worldwide, the company was clearly facing economic difficulties, and so decided to pursue a radical cost reduction strategy. In what was surely one of the longest lockouts yet seen in Australia, GWC management kept the gates closed for five months in an effort to force its workforce to accept the reduced pay package.
The resilience of the workforce and their union, the TCFUA, finally convinced management that its employees were not going to accept the reduced wages, and so in October 2003, as they had promised, they closed the plant. The company then tried to avoid paying workers their redundancy payments for the period that they were locked out by management39 however, this was overruled by the
Commission, which declared that the workers’ continuity of employment had not been effected by the lockout.40
The end result of this dispute was that the workers, supported by their union, successfully withstood the company’s lockout, but in the process they all lost their jobs because of company closure. In a region like Geelong, with limited employment opportunities, other employers are now armed with ‘evidence’ that militant unionism only leads to job losses. No doubt, they will be reminding workers of the closure of this plant the next time a major industrial dispute breaks out in the greater Geelong region.
CONCLUSION
described as one of testing and prodding. In particular, the responses of employers and their associations to the unions’ Campaign 2003 was instructive for the efforts which some major employers went to test, to the ‘nth’ degree, the powers of the Commission to prevent and/or terminate industrial action by workers. Even the employers, seemed to be genuinely surprised—and obviously pleased—at the way the Commission ‘discovered’ new ways to constrain union activity.
A decade of enterprise bargaining has taught employers valuable lessons in negotiation tactics, which they are beginning to demonstrate, by their proactive positions taken during last year’s bargaining rounds. In particular, there is some evidence that more employers are having successes in getting non-union collective s. 170LK agreements registered.
Employers continue to be actively supportive of the Howard Government’s industrial relations reform agenda, and will be hoping that the tough new enforce-ment and policing measures planned for the building industry manage to negotiate their way through the Senate in 2004. No doubt, with a federal election due later this year, and with growing uncertainty surrounding the Howard Government’s hold on office, employer organisations may be expected to commence planning for the possibility of a changed political and regulatory environment. For the time being however, it’s steady as she goes.
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