Tony Burke fires back at BHP after underpayment admissions

The government and unions have seized on the mining giant’s massive underpayments.

Federal Minister for the Arts, Tony Burke, arrives during a State Memorial for the late artist Dr John Olsen AO OBE at the Art Gallery of NSW.

Workplace Relations Minister Tony Burke and the ACTU have seized on BHP having to backpay its workforce by an extraordinary $430m to hit back at the mining giant’s criticism of the government’s second wave of industrial relations changes.

As the Fair Work Ombudsman announced it would launch an investigation into the underpayment of more than 28,000 current and former employees over 13 years, the mining and energy union said BHP had been sprung ripping off workers.

In one of the biggest underpayment cases in Australian corporate history, BHP admitted it had wrongly stripped annual leave days since 2010 for those employees that were on annual leave when public holidays fell.

The admission is a major ­embarrassment to the global mining giant as it pushes back against proposed federal government “same job, same pay” changes that would force the company to pay its contract workforce at the same rates as included in union-negotiated enterprise agreements.

BHP last week clashed with the Albanese government after the company claimed the industrial relations changes would cost the company up to $1.3bn annually, and could cause labour hire demand to “drop off a cliff”.

Mr Burke does not generally comment on individual underpayment issues but made an ­exception with BHP in the wake of its attacks on the government’s industrial relations policy.

“Just last week BHP were trying to assure us that their employment practices were impeccable and the government didn’t need to close any loopholes to protect wages,” Mr Burke said. “That’s clearly not true. Australia can do better to make sure workers are properly paid. That’ll be the focus of our legislation in the coming months.”

ACTU president Michele O’Neil said BHP had “admitted it has underpaid thousands of workers to the tune of $430m, yet the Quiet Australian has been loud in its opposition to updating our laws to make workplaces fairer”.

“In addition to this large-scale wage theft, the same company has been exploiting labour-hire loopholes to drive down wages and conditions for workers on their sites,” she said.

“Wage theft and the use of ­labour hire to reduce pay and conditions are huge problems in Australia and stronger legal protections are needed to protect workers. We trust BHP will now support these changes.”

Mining and Energy Union general secretary Grahame Kelly said the underpayments were “yet another example of dodgy maths and dodgy employment practices from BHP”.

“We will make sure all our ­affected members receive every cent they are owed due to this stuff-up,” he said.

He said the underpayment had been uncovered following “a major union win in the Federal Court in March clarifying ­employee rights around public holidays under the national ­employment standards.

The revelation of one of the biggest underpayments by a single company in Australian history came as the Fair Work Commission prepared to hand down the annual minimum wage decision on Friday.

The Australian Chamber of Commerce and Industry renewed its call for the commission to ­reject the ACTU claim for a 7 per cent pay rise, urging the tribunal to limit the rise to 3.5 per cent.

Chamber chief executive ­Andrew McKellar said business supported an increase but it should be “responsible”.

“The commission must ­reject the populist calls by the ACTU for an inflation matching increase. This only risks embedding inflationary pressures and inflationary expectations, in turn, setting off another round of rate increases,” he said.

“Already burdened by rising mortgage repayments, Australian families would endure additional financial stress and falling living standards if we keep stoking the inflation fire.”

ACTU secretary Sally ­McManus said “if workers did not get a pay rise that keeps up with the cost of living, they will have to cut back even more on spending, which will hurt ­business”.

“It’s about time business recognised it is completely unfair that it is posting record profits while Australian workers suffer savage real wage cuts,” she said.

Australian Industry Group chief executive Innes Willox said the ACTU had not offered one word about how its claim would assist in improving flatlining productivity.

“They just want the handout. They want the hand to be filled with nothing given back and that is just a recipe for economic disaster,” he told Sky News.