Unions go to war over labour hire practices

Unions will use a seven-day strike next week to intensify pressure over the ‘exploitation’ of labour-hire workers.

Jobs and Industrial Relations Minister Kelly O’Dwyer says the government believed ­industrial action should be taken only as a last resort. Picture: Kym Smith

Unions will use a seven-day strike next week to intensify pressure on the Coalition and business over the “exploitation” of labour-hire workers, declaring public unrest at employer conduct will be a “vote-shifter” at the federal ­election.

The Construction Forestry Maritime Mining and Energy Union yesterday revealed workers at the Wollongong Coal-owned Wongawilli Colliery would strike for a week in a bid to pressure labour-hire firm CAS Mine Services to bring the pay of its workers into line with union members in nearby mines.

CAS, which the union ­accused of unlawfully employing its entire 100-strong workforce as casuals, said it would “go broke” if it had to fund a 10 per cent pay-rise claim that it said would wipe out its ­current operating margins.

The strike is the latest flashpoint in the battle between employers and unions in the wake of last year’s precedent-setting court ruling on casuals, with labour-hire firms hit with union claims and class actions over their allegedly unlawful use of casuals in the ­mining industry.

Jobs and Industrial Relations Minister Kelly O’Dwyer said last night the government believed ­industrial action should be taken only as a last resort, and encouraged the CFMEU and CAS to ­return to the bargaining table.

A Federal Court full court ruled last year that casual truck driver Paul Skene was not a casual because of the regular and continuous nature of his work on a fixed roster and he was entitled to receive accrued annual leave pay.

CFMEU national president Tony Maher said employer ­exploitation of labour hire and casual employment arrangements was a “real sleeper for the election because so many people in the ­labour market had been ­adversely affected by this particular business model where, by stealth, permanent well-paid jobs are converted into poorly paid itinerant jobs”.

“It affects a lot of people … in a lot of electorates,’’ he told The Australian.

“The downside for conser­vatives of fly-in, fly-out is that you get people cranky in electorates outside of mining regions.

“There would be a lot of people in Brisbane upset about this; there would be a lot of people in Perth upset about this, so it is, I think, a real sleeper and it’s a vote-shifter, I’m pretty sure.”

The striking workers are paid hundreds of dollars a week less than permanent workers at nearby mines.

From next month, CAS will employ them on 12-month ­contracts but they will lose their casual loadings.

Under the industry award, the use of casual employees is not ­allowed except through an enterprise agreement but CAS did not employ the workers through an agreement, exposing the company to back-pay claims.

Mr Maher said the workers were the “poorest paid in the ­district”.

“The company was not very smart,’’ he said. “The award doesn’t provide for casuals. They are up for a lot of back pay, I would have thought.”

Bill Shorten has promised that labour-hire workers would be paid the same as another worker doing the same job in the same workplace if Labor won the election, expected in May.

In a bid to allay business concerns about the policy, Labor has promised to give employers an extended period, possibly 12 to 18 months, to comply with new ­labour-hire laws.

ACTU president Michele O’Neil accused the Morrison government of aiding “unscrupulous” employers to use ­labour-hire arrangements and casualisation to drive down the wages of workers.

“When a company can make 100 per cent of its workforce ­labour hire, casual or short-term contract, and use these arrangements to cut their pay well below permanent workers in the same region and industry, it’s clear that the rules are broken,’’ she said.

Ms O’Dwyer said “labour hire is a legitimate and useful way for employers to access a flexible workforce and is used across the entire economy covering skilled and unskilled work”.

“Labour-hire employers, like any other form of employer, have an obligation to comply with all their obligations under the law and provide workers with all of their legal entitlements,’’ her spokesman said.

“Labour hire as a proportion of the total workforce has remained stable at around 2 per cent over the last decade.”

CAS business manager Jesse Yvanoff said the labour-hire workers were paid $34 an hour compared with permanent workers at nearby mines who were paid $42 an hour.

The labour-hire employees also received a lower weekly ­attendance payment.

But he said the company rates were similar to comparable ­labour-hire firms.

Mr Yvanoff said for the company to meet the union claim, it would have to receive a commitment from Wollongong Coal to increase the rates.

He said Wollongong Coal, which did not respond to ­requests for comment yesterday, had declined to provide ­additional money.

“If we were to meet their ­demands, as I tell them, we would go broke’’ Mr Yvanoff told The Australian.

“That is nearly double our margins. There’s no way we could afford to do that as a ­company.”

He said converting the workers to fixed full-time employment would see them lose their casual loadings but the shift was the “only proportionate ­response”.

“The CFMEU is using whatever leverage it can to make us change our position,’’ Mr Yvanoff said. “But from the company’s point of view, that’s the only offer we can make to remain a viable business.’’

He said the strike, which was allowed under the Fair Work Act, would have a significant impact on the company’s operation.