A principal contractor at the $767m Maules Creek coal mine project in NSW has sought to remove union and contractor clauses from its construction greenfields agreement out of concern they will not be compliant with the Federal Government’s proposed national building code. The Govt’s building code, attached to its Bill to re-establish the Australian Building and Construction Commission (ABCC), has not yet passed the Senate. However, the code’s retrospective application to all agreements made after April 24 has created concerns among employers (WF19125). At the Maules Creek site, one of the principal contractors Downer EDI reached agreement earlier this year with the Construction Forestry Mining Energy Union (CFMEU), the Australian Workers Union, the Australian Manufacturing Workers Union and the Electrical Trades Union after four months of negotiations. Downer EDI is understood to have about 20% of the work on the site, with its construction work due to start on June 5. However, the parties have withheld from signing the agreement or submitting it to the Fair Work Commission until they know what will happen to the Govt’s proposed code in the Senate or can ensure the agreement is compliant with it.
On May 27, lawyers for Downer EDI held a meeting with the relevant unions where they singled out five ‘non-compliant’ issues in the agreement. They were clauses:
- allowing unions to conduct monthly communications with workers at the employer’s invitation. The code prohibits such arrangements unless done through right of entry requests;
- allowing union delegates to have training;
- allowing unions to post on workplace noticeboards and have access to electronic communication;
- containing a dispute resolution clause that allows an alternative dispute mechanism via the NSW Industrial Relations Commission (IRC); and
- requiring contractors to be hired at the same rates and conditions as those of the greenfields agreement.
CFMEU will be code compliant for greenfields
CFMEU construction division Newcastle organiser Peter Harris told Workforce the lawyers had requested a response to these issues within the next few days. Harris said the unions had agreed to make the code compliant but would propose to rephrase some of the clauses. On CFMEU secretary Dave Noonan’s comments the union would ignore the Govt’s proposed code in enterprise negotiations (WF19125), Harris said that approach applied to standard CFMEU enterprise agreements. However, he said the CFMEU had agreed multi-union greenfields agreements would be code-compliant as long as the majority of unions involved did not object. Harris warned if the new Senate from July 1 rejected the code, the CFMEU would seek to reinstate the clauses. “We’ll be saying to Downer EDI you jumped the gun and we want to reopen the agreement and have it as it was previously.”
Hunter Valley model ‘uncertain’ under code
On the non-compliant clauses, Harris said the main loss was the contractor clause, which had been agreed by both parties. He noted Downer EDI’s workforce tended to be 80% direct employment because the company did not want to risk being responsible for contractors that went insolvent. He said the clause would have ensured contractors would not pay inferior rates and would allow Downer EDI to hold them accountable. Harris said the union would instead seek to negotiate with subcontractors individually. Harris said the code also appeared to threaten the project’s use of the successful ‘Hunter Valley’ model of dispute resolution led by NSW IRC Deputy President Rod Harrison. Harris said it was “uncertain” whether the code allowed for such alternative dispute mechanisms, despite the parties’ preference for the Hunter model.
‘Ironic’ code preventing project advancement
Last week at the NSW IR Society Conference, DP Harrison noted Unions NSW had sought the IRC’s involvement in the project in March this year. He said the relevant parties had held their first orientation conference on April 14, where they scheduled monthly communications, an agreement strategy, key milestones and a quick response mechanism for disputes. He had noted the parties were holding off signing the agreement because of concerns about the proposed code. “They will make the agreement compliant with the code but it’s ironic that it’s a piece of federal legislation with some retrospectivity in it that is one of the roadblocks in taking this project forward,” he said. The Maules Creek project is not funded by federal government money. However, the CFMEU’s Harris said that the Govt’s proposed code operated so that it took into account all agreements made by a company tendering for govt work, whether or not those agreements related to govt-funded work. Harris said that major engineering companies in northern NSW at other projects were also seeking to make their greenfields agreements compliant with the unlegislated code. He cited the upcoming agreement with Lend Lease for the federal govt-funded Oxley Highway upgrade.
First published in Workforce 30/05/2014.
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