Diamond of a deal among the rough

TODAY we have a posy and a pineapple. A giant, spiky pineapple, inserted with maximum force, for Victoria Police. But, first, a posy goes to the industrial relations managers at BHP Billiton.

This year, global iron ore prices plunged by almost half. Three of the world’s four largest iron ore producers are Australian. Are these companies in danger, I wondered?

Might terrible enterprise bargaining agreements — as occurred at Holden, Ford and Toyota — cripple their ability to cope with market forces?

If BHP Billiton is any guide, there is no need to worry. BHP Billiton has about 3500 frontline iron ore workers, drivers, operators and other workers on individual contracts.

Salaries are reviewed once a year in performance review meetings and adjusted at the discretion of management, depending on both company and individual performance.

If the company doesn’t want to give any pay rises from this minute on, it cannot be forced to. Pay rises can be given to some and not to others, even if they are working side by side, doing the same job. Pay rises can be awarded and, if times get even tougher, taken away.

These workers are not exploited. The arrangements have been agreed to democratically and sanctioned by the Fair Work system.

Very short (about seven pages) EBAs set out high but market-appropriate fixed-base salaries and conditions. Individual contracts supplement these EBAs by providing additional, discretionary payments over the life of the EBA. This means wages can be flexed up and down, providing they do not fall below the base EBA rates. This system provides job security, an income safety net and capacity for productivity-based reward.

For the life of the EBAs, workers are prohibited from taking any form of industrial action, giving the company certainty over production. The EBAs are, quite properly, made with employees, not unions, and signed by employees, not union officials. People may or may not be in various unions, but that is of no concern to the company.

If the unions want to talk to anyone, they can enter lunch rooms in non-working time, but no one is obliged to talk.

When EBA processes took place, unions were involved, but legislation recognises that the parties to agreements are employees and employers. Unions are only hired agents.

Regardless of talks with unions, all agreements were made directly with the employees, so now the capacity of any union to make mischief is curtailed. In the future, the EBAs can be renewed or simply let expire, because they continue with the force of law past expiry, until replaced. In other words, the company is sitting pretty.

BHP management has implemented the bargaining provisions of the Fair Work Act exactly. Direct engagement with the workforce and accurate application of the law has occurred. What a shame more companies cannot do the same and what a shame our community has been persuaded that this outcome cannot be achieved without some sort of legislative reform.

Now, we need to talk about Victoria Police. On Friday, December 5, four union officials in two cars blocked the driveway of a building site in Melbourne. Vehicles could not get in and all work had to stop. The police were called and did absolutely nothing, other than provide one officer to monitor the blockade in case of abuse or violence.

On the Sunday and the Monday that followed, the cars remained and the workplace was closed. On the Tuesday, the union officials didn’t blockade, but drove past every hour or so to make sure no work was happening.

Late in the day, the new Premier said he couldn’t see why work couldn’t resume, and on the Wednesday afternoon it did.

The police wrongly and absurdly thought the blockade an industrial “dispute”, because the people performing it were union officials. A recent decision by the Federal Court confirms driveway blockades like this are not industrial action, but any idiot could tell it was simply a trespass. The police requested and were given special laws to remove trespasser blockades. Now, they won’t use them.

So, in Victoria, union officials are allowed to randomly blockade anyone’s driveway and all the police will do is make sure the blockade occurs in a gentlemanly fashion. If this isn’t dealt with it will spread. Whose driveway will be next?

Thank you for reading the column this year; writing for you has been a pleasure and a privilege. Merry Christmas and a Happy New Year.