Labor's Brendan O'Connor attacks the Trade Union Royal Commission ahead of Bill Shorten's appearance
Reserve Forces Day Parade just about to step-off in Sydney - thank you for your service diggers

Bill Shorten's 2003 betrayal of mine workers - Shorten "duplicitous and untrustworthy", AIRC

Screen Shot 2015-07-05 at 7.10.14 am

On 21 June this year Bill Shorten said he was proud of his record of negotiating agreements, and made sure that both “employers and employees could get the best out of going to work every day.”

“I’ve spent my whole working life standing up for workers,” Mr Shorten said.

“I was a modern trade union leader in that we knew the old centralised system had ended.”

I've been examining Bill Shorten's deals for some time now - Winslow, Spotless, Chiquita Mushrooms, Thiess John Holland and the list goes on.   But nothing I've seen before comes close to Shorten's 2003 sneaky, secret betrayal of his union's WA Branch and workers in the Pilbara - all done to advantage the bosses at Rio Tinto/Hammersley Iron - and of course himself.

In early 2003, WA based unions, including the WA Branch of the AWU, were negotiating new state-based agreements on behalf of the Rio/Hammersley Pilbara workforce.  The WA AWU Branch Secretary Tim Daly was out in public acting in good faith on the instructions of the local workers.   Unbeknownst to him Bill Ludwig and Bill Shorten were secretly undermining him and their local Branch, cutting a secret deal directly with Rio Tinto national management.   They didn't even tell their own WA based secretary until the deal was a fait accomplit.

Here's an extract from the Australian Industrial Relations Commission judgement on the matter, referring to the AWU head office (i.e. Shorten)'s conduct including:

failures by the AWU to inform its State Branch of negotiations with the companies in 2003; or to consult with Hamersley workers about the proposed award; or to honour an undertaking to Pilbara employees to not finalise entry into a federal award without consultation.

....the AWU did not consult or did not adequately consult either its affected membership, or the workforce whose industrial interests it is empowered by the Act to represent.

Here's a quote from a Rio executive widely circulated at the ACTU 2003 Congress:

The motivation for Rio Tinto's signing of a new federal award with the AWU was explained by a Rio Tinto manager quoted in documents distributed to the ACTU 2003 congress: "The award will mean that the company will be able to largely run their own affairs without being hassled by the unions and the WA industrial relations commission. To do that we had to get close to a union."

And reaction from the workers?

Quill and Shane Kelly, another PMU (union) representative and Hamersley Iron worker who attended the ACTU congress in Melbourne, expressed their anger and frustration at the AWU leadership to Green Left Weekly. Kelly said Hamersley Iron workers "feel like we've been stabbed in the back by [AWU national secretary] Bill Shorten. They never talked to workers on the ground prior to making the deal. We received an email from management to say that the deal [for a federal AWU award] was already signed, sealed and delivered."

The AWU's federal award "mirrors a lot of what's in the workplace agreement [AWA]", said Quill. It also includes things such as unpaid overtime, which were in the non-union section 170LK agreement that was rejected by Hamersley Iron workers in 2002.

On some things, the AWU award is worse than the AWAs. For example, the AWU award offers only a 30% site allowance for living in the inland towns, whereas workers on AWAs get a 35% site allowance. This site allowance is important because the isolation of the inland towns makes the cost of living extremely high.

Kelly pointed out that the AWU's award gives management the right to use "management discretion" to change workers' shifts purely to suit the interests of the companies, and can force people to work more than their 12-hour shift.

Here's some of the timeline from the Australian Industrial Relations Court hearing on the matter starting a long way down the track in May 2003, the whole timeline (dating to the 1980s and putting Shorten's deal in perspective) is part of the AIRC Judgement at:

https://www.fwc.gov.au/documents/alldocuments/PR947647.htm

7 May 2003

Hamersley sends letter to State unions regarding state of negotiations. Reiterates preference for federal coverage to State unions but indicates willingness to negotiate without prejudice for an up to date State award while the federal claims by the AWU and CFMEU are investigated. In cross-examination Mr Danks acknowledged that the content of a federal award with the AWU at that time was "pretty well finalised" but the deal was not yet done.

Exhibit HAM 2 at page 93; Exhibit Rio 15 at pages 9-12; PN1616-1618.

8 May 2003

Four State unions write to Hamersley stating belief that Hamersley not negotiating in good faith and invoking s.42 of State Act in relation to a State agreement for those employees on the award and others that have not signed an AWA.

Letter of 8 May signed by Mr Mossenton: Exhibit Rio 15 at page 18.

9 May 2003

Second meeting between Hamersley and State unions regarding State demands.

PN1459 of transcript from 3 March 2004.

13 May 2003

Hamersley sent letter to CFMEU seeking clarification of whether it would pursue federal or State award negotiations.

Exhibit HAM 2 at page 102 Tab SDH 10.

15 May 2003

Hamersley advises employees of contacts with federal AWU and CFMEU and in letter to State union negotiators claims not to know the status of the federal proceedings and denies that it is not bargaining in good faith.

Exhibit Unions 4 Attachment 25; Exhibit Rio 15 at page 19.

23 May 2003

Further meeting of negotiators about State agreement.

PN1459.

27 May 2003

AWU-Hamersley-Robe negotiators meet at AWU Office in Brisbane.

Exhibit Unions 14 at [100]; PN1460.

June 2003

Mr Daly, Branch Secretary of AWU told by his National Secretary, Mr Shorten, that negotiations on a federal award were positive. Until then, the evidence generally supports a finding that the content and extent of the federal negotiations was not disclosed to AWU State Branch officials; or to other unions State or federal.

 

10 June 2003

Proceedings in AIRC regarding CFMEU notification in C2002/5383 before Polites SDP indicating federal award was long term objective. Mr Allen foreshadows invocation by State unions of s.42 of State Act for enterprise order against Hamersley. Polites SDP summarised position in a question affirmatively responded to by CFMEU representative and not contradicted by Mr Allen: "because of the negotiations at State level the CFMEU, and may be the AWU, have resolved not to at this stage press their federal claims pending the outcome of those negotiations".

Exhibit HAM 2 at page 77; Transcript at PN90-97.

18 June 2003

Further negotiating meeting with State unions. The company indicated that discussions were being held at federal level with the AWU but discussions at State level were also being pursued by the AWU.

PN1459 and PN1603.

24 June 2003

AMWU(WA) and CEPU(WA) lodge applications in WAIRC for declaration under s.42H that bargaining negotiations with State unions and Hamersley have failed, seeking enterprise orders under s.42I of the Act.

Exhibit HAM1 Attachment 2: 2003 WAIRC 09898 per Kenner C at [8 - 9].

25 June 2003

Hamersley advise employees that they are following up the federal unions to discuss option of federal award and of discussions that have taken place with AWU.

Exhibit Unions 4 Attachment 25.

27 June 2003

Report back hearing in AIRC regarding AWU dispute finding: CFMEU National President attends. AIRC advised discussions significantly advanced and parties hope to be in a position within weeks to put forward consent award, with AWU as the only union prepared to enter into negotiation to consider a federal award.

Exhibit HAM 2 at page 109.

1 July 2003

ACTU hold telephone conference to discuss Rio Tinto's approach for a federal award: AWU advised intention to pursue federal award and MOU with Hamersley. Other unions expressed disappointment and advised intention to oppose federal award application. Around the same time a decision was made by intervening unions to apply for a variation of the State award.

Exhibit Unions 4 at [20]; PN2463.

4 July 2003

AWU-Hamersley-Robe negotiators meet at Freehills Solicitors Melbourne Office.

Exhibit Unions 14 at [100] and Exhibit AWU 4 at [11].

8-10 July 2003

Mr Phillips attends Pilbara Mine meetings to present federal option and gather employee views. Mr Phillips accepted that, at those meetings, he indicated the AWU: would keep other unions and the ACTU involved in the process; was looking at both federal and State jurisdiction options; would not agree to a federal award without coming back to employees.

On 8 July in Perth, at a meeting convened by the Trades and Labour Council, Mr Daly (AWU State Secretary), on behalf of the AWU reaffirmed the AWU's full support for the pursuit of a State agreement with Hamersley.

 

 

14 July 2003

AWU-Hamersley-Robe negotiators at Freehills Office in Melbourne. At this or preceding meeting the AWU negotiators secured from the company's negotiators a document explaining that the 9 employees still under the State award would be better off.

PN1464, PN1828.

15 July 2003

AWU-Hamersley-Robe negotiators teleconference meeting about award.

 

20 July 2003

AWU(WA) Secretary Mr Daly told that AWU-Hamersley negotiations on federal consent award had resulted in "deal being done".

 

21 July 2003

Proceedings in AIRC: AWU and Hamersley and Robe advise Commission that they agree to establish a federal award.

Exhibit HAM 2 page 125; Exhibit Unions 4 Attachment 25 (announcement to employees).

21 July 2003

CFMEU advise of application under s.111AAA.

Exhibit HAM 2 at page 137.

28 July 2003

Report back hearing in AIRC regarding AWU s.99 presentation of consent award foreshadowed.

 

1 August 2003

Meeting between ACTU and Rio Tinto regarding option of federal award with all unions.

Exhibit Rio 14 Attachment 6.

4 August 2003

Report back hearing in AIRC at which State Branches of CFMEU, CEPU and AMWU intervene indicating opposition to making of federal award.

 

8 August 2003

State unions make application 1216 of 2003 in WAIRC seeking to amend State award in a comprehensive manner. AWU(WA) not an applicant but reserves right to support the application of federal award not made. The s.111(1)(g) application is lodged the same day in matter C2003/760, and the ACTU advises Hamersley that the making of a federal award will be opposed.

Exhibit HAM 1 Tab 4; Exhibit Unions 4 Tab 27 at page 82; Exhibit HAM 2 at page 275.

8 August 2003

ACTU write to Rio Tinto advising that as a result of the meeting on 1 August 2003, the unions would oppose the federal award.

Exhibit Unions 2 Attachment B.

8 August 2003

Hamersley replies to ACTU letter.

Exhibit Rio 14 Attachment 7.

11 August 2003

Further application by State unions number 1230 of 2003 in WAIRC adding Robe River to Hamersley award.

Exhibit HAM 1 Attachment 5.

 

Following are quotes from the Industrial Relations Commission hearing on Bill's plans for a boss-friendly award for Rio.

  • The intervening unions pointed to the fact that the federal award negotiations between the AWU, Hamersley and Robe had been conducted on a confidential.....basis. They categorised that conduct as the imposition of a shroud of secrecy compounded by actions which amounted to bad faith negotiation.
  • That contention was supported by reference to failures by the companies to disclose negotiations with the AWU to State unions, (including at critical times the AWU State Branch negotiators or representatives in the Pilbara); to be frank with the CFMEU, to be full and frank in reporting to the Commission in the CFMEU dispute matter; and failures by the AWU to inform its State Branch of negotiations with the companies in 2003; or to consult with Hamersley workers about the proposed award; or to honour an undertaking to Pilbara employees to not finalise entry into a federal award without consultation.
  • ...the AWU did not consult or did not adequately consult either its affected membership, or the workforce whose industrial interests it is empowered by the Act to represent.
  • The officers of the AWU participated in ACTU conferences with other nationally registered unions about the union organisation campaign in the Pilbara, and the associated negotiations for collectively bargained conditions of employment for Hamersley workers. On the evidence, the AWU representatives failed to disclose to those meetings the collateral, confidential and without prejudice negotiations that Mr Shorten and Mr Ludwig for the AWU had taken to an advanced stage by April 2003. That conduct by the AWU may reasonably be described as duplicitous or untrustworthy by other participants in the ACTU or PMU processes.
  • The allegation of bad faith bargaining against the employer parties, and against the AWU, has more force in application to the process that the State unions initiated in the WAIRC. As noted in the chronology at Appendix A, from mid-February the State unions had pursued formal bargaining notices under the State industrial regime with Hamersley. On 8 May 2003 all State unions wrote to Hamersley stating a belief that Hamersley was not negotiating in good faith, invoking section 42 of the Industrial Relations Act 1979 (Western Australia), (the State Act).  It is not necessary for us to express a concluded view about whether Hamersley, as a negotiating party, did all that was necessary to comply with the duty on it to bargain in good faith with the State unions. However, we accept that it may plausibly have been contended, on the facts as we now know them, that Hamersley's negotiating agents did not bargain in good faith, and that, the federal negotiators for the AWU aided and abetted that conduct22
  • From some time in mid to late February 2003 confidential negotiations were being held between company representatives and representatives of the AWU. Meetings were subsequently held between April and July 2003. No representatives of the State unions were involved in those meetings nor informed of them.
  • [73] In mid July 2003 Mr Phillips, a representative of the federal AWU, attended meetings of Hamersley workers in the Pilbara and advised that no Federal award would be agreed to without coming back and consulting with the employees first. On 20 July 2003 Mr Shorten of the AWU telephoned his State counterpart Mr Daly to advise that agreement in principle for an award had been reached between the union and the companies.

And here is a reference in the Judgement to one of the primary reasons Ludwig and Shorten were pushing for their own deal directly with Hammersley/Rio.

  • The proposed Federal award will disturb the traditional coverage of the State unions. It will in a practical way extend the traditional coverage of the AWU.

3 days after the WA Branch Secretary Tim Daly received his call from Shorten, this announcement completely undermining him was released by the AWU:

Home pastedGraphic.pngAWU National News pastedGraphic.pngMining Industry STARTCONTENT

AWU Secures Wages and Rights at Rio Tinto

22 July 2003

Rio Tinto workers who have not signed a Federal AWA will receive average pay rises of around $4,000 bringing them into line with their workmates on AWAs without the need to sign one of the individual agreements under an historic award secured yesterday by the Australian Workers’ Union.

The award will cover over 2,000 workers employed by Rio's subsidiary companies Robe River and Hamersley Iron in Western Australia's mineral-rich Pilbara Region.

The award negotiated between the AWU and Rio Tinto was presented to the Australian Industrial Relations Commission (AIRC) yesterday along with an unprecedented Memorandum of Understanding between the two parties that:

• recognises the role of the AWU in Rio's workplaces

• provides access for workers the AIRC

• secures the right for workers on AWAs to be represented by a union in Rio's internal fair treatment policies.

The rates of pay contained in the award are substantially more than is contained in the current Western Australian Mining Award. Currently all Robe River employees are covered by a Federal non-union Collective Agreement and 89 per cent of Hamersley Iron employees are on Federal Individual "AWA" Agreements.

AWU National Secretary Bill Shorten said the Award signals the start of the end of decades of bitter warfare between the mining giant and the trade union movement and acknowledged the role of ACTU Secretary Greg Combet in getting the ball rolling on re-unionising the Pilbara.

"There comes a stage in every unionizing campaign where an organization has to move from being a ginger group outside the gates and move towards being recognised and accepted by the employer as a legitimate participant in the workplace." Mr. Shorten said.

AWU National President Bill Ludwig said "This is the first time in 17 years that a union has been able to get an agreement in place for Robe River and now that this cooperative framework is in place we look forward to a new era of industrial harmony in the West".

The AWU hasn't vetoed any other unions from becoming parties to the new Award. The matter has been referred to the President of the AIRC for his consideration. 

ENDCONTENT Contact Details Contact Details

AWU National Office

Ph:  (03) 9329 8733

Fax: (03) 9329 2871

members@awu.net.au 

 

AWU National News 

Current Stories | Archive by Date | Archive by Category

 This story from Green Left Weekly includes some quotes from workers outraged at Shorten's grubby deal.

AWU betrays Pilbara workers 

Wednesday, September 10, 2003 - 10:00

BY SUE BOLTON

An attempt by trade unionists working in the Pilbara mines in Western Australia to end rivalries between their unions, to present a united face to the mining industry bosses, has been sabotaged by the Australian Workers Union.

At the August 18-21 ACTU congress, two delegates from the newly formed Pilbara Mineworkers Union — Kevin Quill from the Hamersley Iron mine, and Daniel Connors from the BHP mine — explained to congress delegates the process of formation of the PMU and how AWU national officials had undermined this effort at cross-union organisation.

The PMU is an umbrella organisation bringing together members of the Construction, Forestry, Mining and Energy Union (CFMEU), the Communications, Electrical and Plumbing Union, the Australian Manufacturing Workers Union, the Transport Workers Union and the AWU.

The PMU was established on the principle that union members in the Pilbara should make the decisions about their future, rather than a union office in Perth or interstate.

With the election of Premier Geoff Gallop's Labor government in 2001, and its partial rolling back of the previous Coalition government's anti-union laws, the PMU began a process of consulting workers about what they wanted to see in a new state award.

However, this process was abruptly halted when the national officials of the AWU secretly negotiated a new federal award to cover Rio Tinto's Hamersley Iron and Robe River mining operations. The new award was announced by the national office of the AWU on July 22.

Quill and Shane Kelly, another PMU representative and Hamersley Iron worker who attended the ACTU congress in Melbourne, expressed their anger and frustration at the AWU leadership to Green Left Weekly. Kelly said Hamersley Iron workers "feel like we've been stabbed in the back by [AWU national secretary] Bill Shorten. They never talked to workers on the ground prior to making the deal. We received an email from management to say that the deal [for a federal AWU award] was already signed, sealed and delivered."

Secret negotiations

The secretiveness of the AWU's negotiations with the bosses leads Quill to believe that "the AWU's been doing this deal all the time that they've been saying they're still with the four unions working on a state award".

The AWU is trumpeting the agreement as a victory for unionism. On July 22, AWU national president Bill Ludwig announced that "this is the first time in 17 years that a union has been able to get an agreement in place in Robe River".

Quill and Kelly have a different view.

The AWU's federal award "mirrors a lot of what's in the workplace agreement [AWA]", said Quill. It also includes things such as unpaid overtime, which were in the non-union section 170LK agreement that was rejected by Hamersley Iron workers in 2002.

On some things, the AWU award is worse than the AWAs. For example, the AWU award offers only a 30% site allowance for living in the inland towns, whereas workers on AWAs get a 35% site allowance. This site allowance is important because the isolation of the inland towns makes the cost of living extremely high.

Kelly pointed out that the AWU's award gives management the right to use "management discretion" to change workers' shifts purely to suit the interests of the companies, and can force people to work more than their 12-hour shift.

The Gallop government's industrial relations reforms put a deadline on the expiry of WA individual workplace agreements, so, in early 2002, Rio Tinto offered its workers a non-union section 170LK agreement.

After the workers rejected it, Rio Tinto began offering AWAs with a 6% pay rise in September 2002. Eventually, around 80% of workers signed AWAs. However, 130 workers refused to sign.

In the meantime, with the help of ACTU organiser Stewart Edwards, a doorknocking blitz was organised in the mining towns, which found people were sick of the old unions squabbling over members. So the Pilbara Mineworkers Union was formed.

The PMU got workers talking about what they wanted in a new award. "People became interested in unions again", said Quill. "They began to get a bit of confidence and trust in us." This was a massive achievement because "a lot of people working here came from non-union backgrounds and they were very sceptical of unions".

The result of the AWU's treachery, said Quill, is that "the people we were winning over [to support unions], we started to lose them again. They told us we told you so, we knew it would happen."

Resentment

"There's a lot of anger, resentment towards the AWU", said Kelly. "We have a lot of people who have signed AWAs, who are paying into the PMU. When their AWAs expire in three years time, they want a good state award to come back to. A lot of the workforce are newly employed and had to sign AWAs to get jobs."

Quill's opinion is that the AWU "won't get one member through this agreement. They'll lose members over this, but it will affect all of the unions. For the people who are suspicious of unions, this one bad point will cross out 10 good points of unions. We have suffered a tragic setback through this."

Quill pleaded with ACTU congress delegates: "We've answered the call for the unions' return to the Pilbara. Now all we ask is that the union movement look after us and try to help us out." He called on them to take steps to prevent the AWU from going through with the federal award.

However, the AWU officials present refused to concede to any of the PMU delegates' concerns. Shorten told congress delegates that the AWU leadership was not going to sit and watch the "diminishment and disappearance of the AWU in metalliferous mining".

He said that the AWU had worked with other unions at BHP but had chosen not to do so at Rio Tinto "because we hadn't resolved the coverage issues". He added that the AWU leaders "do believe that freedom of association means the right to belong to a union, not to any union".

The ACTU officials didn't allow any specific motion condemning the AWU's actions to be debated on congress floor. ACTU secretary Greg Combet stated firmly that "the ACTU officers will never ever want this forum used as some basis for an attack on one of its own members, one of our own affiliates. We don't care who it is."

The motivation for Rio Tinto's signing of a new federal award with the AWU was explained by a Rio Tinto manager quoted in the PMU leaflet distributed to congress delegates: "The award will mean that the company will be able to largely run their own affairs without being hassled by the unions and the WA industrial relations commission. To do that we had to get close to a union."

Rio Tinto was worried that the PMU was succeeding in rebuilding unionism in the Pilbara and might succeed in winning a state award.

Bosses' attacks

Over the past 20 years, Pilbara workers have suffered repeated attacks by the bosses, particularly from management at Robe River and Hamersley Iron, where union membership came close to being wiped out.

In 1986, Robe River Iron Associates locked out workers for many weeks. In the end, the company agreed to drop all legal action against individual workers in return for the unions agreeing to the majority of work practices that were being demanded by the company. In 1991, Robe River sacked its unionised tug-boat operators and replaced them with non-union labour.

In 1992, Hamersley Iron deliberately provoked a two-week strike when it employed a worker who refused to join the union. Following the dispute, Hamersley Iron eliminated all but one of the union convenors by offering voluntary redundancy packages.

Also in 1992, Robe River sacked 52 workers for participating in an ACTU-called 24-hour strike to protest against the anti-worker actions of Premier Jeff Kennett's government in Victoria. Twenty-nine of these workers had refused to give an unconditional commitment never to attend a stop-work meeting or strike. While waiting for the Industrial Relations Commission to rule on the sackings, Robe River issued notices to evict the workers from their company-owned homes.

It was this dispute which left a legacy of anti-union feeling in the Pilbara. The Robe River workers felt that they had been abandoned by the ACTU after having answered a call to action.

Connors told the ACTU congress that the unions had "managed to stem the tide [at BHP] and we've had some good victories. In the last 12 months, we've won a 20% increase on wages and allowances, and an increase from 9% to 14% in employer superannuation contributions. And more importantly, we've had our hours of work systems set in our award such that day workers work 40 hours and shift workers work 42. That's a major victory for us."

 

From Green Left Weekly, September 10, 2003.

https://www.greenleft.org.au/node/29083#sthash.p3jldmQs.dpuf

Here's some further reading:

http://pandora.nla.gov.au/pan/49430/20091123-1334/www.mngt.waikato.ac.nz/airaanz/proceedings/noosa2004/nonrefereedpapers/ellem.pdf 

and quite a few articles at the National Archives here - and this fabulous book extract.

In summary - everything you need to know about Bill Shorten in one, mega-grubby deal for Bill and the bosses.

Screen Shot 2015-07-05 at 7.43.25 am

Comments