Union-link firm blocked on wage deal

A company allegedly controlled by one of Australia’s largest unions has been forced to dump a wage deal for the trainee electricians it employs.

Electro Group trains electricians and finds work for them with electrical contracting businesses in NSW and the ACT.

A company allegedly controlled by one of Australia’s largest ­unions has been forced to dump a wage deal for the trainee electricians it employs after it failed to explain to them that their pay and conditions were to be far outside industry standards.

The Fair Work Commission has ruled that Electro Group, a not-for-profit company allegedly controlled by the Electrical Trades Union, did not gain the genuine agreement of its apprentice ­employees for their wage deal.

Electro Group trains electricians and finds work for them with electrical contracting businesses in NSW and the ACT.

The commission accepted the submission of barrister Arthur Moses SC, representing the ­National Electrical and Communications Association, that Electro Group did not provide an explanation to its employee apprentices that took into account their “particular circumstances and needs”.

The appeal ruling late last month by a commission full bench is unusual because most findings for breaches of conditions or failure to uphold enterprise agreement requirements are made against mainstream employers, not those alleged to be under union control.

Another unusual feature, based on Mr Moses’s NECA submission that the ETU has a controlling interest in Electro Group, is the possibility that a union was both the bargaining agent for electrical apprentice employees at Electro Group, and their ultimate employer, during wage negotiations. The commission full bench noted that the ETU, which is part of the Communications Electrical and Plumbing Union, was the “bargaining representative” for Electro Group employees. It also noted the claim of the NECA, represented by Mr Moses, that the ETU or CEPU had a “controlling interest” in Electro Group.

However, the commission also said the union did not admit to a controlling interest in the company, and it was not established by evidence.

At the heart of the NECA’s objections to Electro Group’s apprentice wage deal was its concern about significant “backdoor” pay increases potentially foisted on employers in the electrical contracting industry which the NECA represents.

Electro Group’s proposed hourly pay rates, overtime, allowances, rostered days off, mandated 36-hour week, picnic day and other entitlements were far above conditions for apprentices hired by most contractors in the electrical services industry.

Mr Moses, for the NECA, argued that the wage deal’s conditions could act as an impediment to apprentices finding work if “host” employers were discouraged from hiring Electro Group-trained workers because of significantly higher labour costs compared with those for apprentices found elsewhere.

The commission full bench of vice-president Adam Hatcher and deputy presidents Reg Hamilton and Val Gostencnik said the NECA’s “real interest” was not to protect the interests of Electro Group employees but to block the approval of their employer’s wage deal so that NECA-member electrical contracting companies did not have to pay “enhanced rates of pay and conditions”.

While the full bench did not accept the NECA’s argument that Electro Group’s pay deal operated as a “restraint on trade”, it did reject a finding in October by Commissioner Leigh Johns that the enterprise agreement was “genuinely agreed to” by employees.

If Electro Group wants to press ahead with its pay deal, then it will need to resubmit the agreement for approval after fully explaining to apprentices the higher pay and conditions in the context of industry standards.