AMWU National Secretary, Dave Oliver, speech to the National Conference of the Australian Mines & Metals Association (AMMA) on May 26th, 2011.

Introduction:

Thank you for the invitation to be here today. It’s been a long while since a secretary of the manufacturing workers’ union has spoken to AMMA.

The theme of my talk is productivity bargaining.  I think this is an important topic for unions and employers to discuss.  I’m looking forward to the panel session later this morning where I hope we can expand on some of the ideas I’ll go through in this address.

Productivity in the mining sector certainly has come a long way since the 1850s, when pick axes and gold pans were the tools of the trade, and tens of thousands of miners spent their days digging and panning for thimblefuls of precious metal.

The goldfields of Bendigo and Ballarat are a celebrated part of our National history.  They were the scene for some of the earliest forms of collective action – both of workers standing up for their rights, and of employers rebelling against government control of the industry.

Not much has changed in 150 years!

I’m not sure what the rebel leader, Peter Lalor, would have made of last year’s mining tax debate – certainly, the miners who rallied in Perth last year were a little better dressed than those at the Eureka stockade – but I think it is fair to say that both cases prove we are better off negotiating than fighting.

There are several key areas that I want to touch on briefly in the time that I have today.

They are:

1. Productivity and Industrial Relations

How can management and workers improve productivity through co-operative engagement instead of ideological approaches to so-called ‘human resource’ management and individual contracting?

2. Skills and training issues such as apprenticeships, recognition of prior learning, as well as mobility between projects.

3. Finally, could this industry get a better overall result if companies, unions and the government all worked together to address these issues at an industry level?


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1. Productivity and Industrial Relations

Workplace relations can have a profound affect on productivity. I don’t need to tell you what your HR consultants probably have you well versed in – a happy and fulfilled workforce is more productive than workers who feel undervalued or disrespected.

It has been my experience as a worker and a union official that enlightened management and a unionised workforce creates the most co-operative workplaces where both parties on an equal footing engage in genuine productivity improvements.

Of course, we recently had a government determined to install its ideology into Australia’s workplaces by regulating the ability of workers to be involved in unions, by restricting matters that employers and employees could bargain for, and by skewing the market to make collective agreements more difficult to achieve than individual contracts.

Individual contracts, I believe, have had a deleterious effect on both workplace relations and the industries ability to implement productivity improvements.

Employers often cite the disputes they have with unions as proof of unions causing trouble.  What they don’t see is all the disputes that are avoided by working and negotiating with union delegates in a democratic structure.

I’m sure you’ll all rush up to me afterwards with stories about bad union behavior but I’ve got just as many stories about bad management practices.

The choice is stark – human resources specialists can either deal with hundreds of similar issues at an individual level over the life of a project, or they can deal with well-trained, union delegates handling common issues on behalf of a collective of workers who have a democratic say.  Disputes are a fact of life, and there must be processes to resolve them in a speedy manner before they are allowed to spiral out of control.

The best on the job dispute resolution system is an organised workforce with well trained representatives who are able to talk through and resolve issues with management before moving to external, formal dispute procedures if needed.

Unfortunately, while managers are encouraged to receive training in HR, companies often deny union delegates the right to attend training.  Even worse, workers are often reluctant to put up their hands and represent their workmates for fear of reprisals and black-lists.

A quick example of what I am talking about is what happened on the Pluto Project.

There are many workers involved in that dispute who still work on that project, and will continue to work on new projects, and are still facing charges and sanctions from law enforcement and the ABCC.

How does that help create a co-operative environment in which to pursue productivity reforms?

It is in all of our interests to have a way to avoid those disputes and we would be all better off without a system that drags a dispute on for 18 months after it has actually finished.

A genuinely co-operative and democratic workplace relations system and respect by employers for the democratic rights of their workforce must be the starting point for genuine and lasting productivity improvements.

Of course, WorkChoices was an ideological instrument which were pleased to see defeated at the 2007 election.

The new FairWork system has gone a long way to restoring balance, though I believe the restrictions on some forms of agreements – such as at the industry level – stems from an ideological blind spot which forces parties away from the most mutually satisfactory arrangements.

I will talk about industry agreements later, but before I finish on productivity and workplace relations, I have to talk about management quality, because it too is a factor in productivity.

A major impediment to productivity can be the quality of management at the site level.  A lack of leadership or expertise among site managers results in undirected work and can generate a lack of confidence or respect from a qualified workforce.

Here are a few examples constantly raised by our members:

•    Poor screening of employee qualifications.
Our union is concerned with maintaining the integrity of the trades.  The qualification means a lot to our members.
Plenty of trades workers raise with me cases where they have worked alongside people who don’t even know how to weld, read drawings or carry out the tasks in front of them. It is frustrating and potentially dangerous.
•    Supervisors who aren’t qualified.
There are site managers who do not have the expertise to check on the work being done by qualified trades workers, let alone suggest better ways of organising tasks.  We have experience of supervisors who do little more than sit in the site shed, occasionally checking that workers finish their smoko breaks on time.
•    An inability to recognise benefits of on-time or early finishing.
I was recently told about a site manager who gave a power point presentation where workers were told that if they finished on time or ahead of schedule, their reward would be more work. He seemed to think he could motivate them to work harder by worrying them about where their next job was coming from – in the midst of a skills shortage.
They just laughed, and it’s no wonder that there is a morale problem on a lot of these projects where workers don’t believe their efforts are being recognised.

In all of those examples, you have a workforce willing to listen to suggestions that would make them more productive and the failure is with management to engage them and to provide motivation or direction.

Productivity improvements cannot be implemented without addressing that issue.

Secondly, I want to talk about skills and training issues such as apprenticeships, recognition of prior learning, as well as mobility between projects.

Skills and training:

We should be looking at ways to increase the overall investment in training.

The AMWU has proposed a training fund which would see employers and government make equal contributions.

Employers can’t complain about skills shortages on one hand and not invest in training on the other.

We also need to look at flexible delivery measures for training, such as training centres on projects and to increase the intake and the completion rate of apprenticeships.

Finally, we need to increase the capacity to recognise prior learning and provide upskilling.  Our union’s position is clear that there must be quality, training and assessment.  It must not be designed to devalue the qualification.  It must be proper, recognised and accredited training – not mickey mouse courses.

We cannot treat the labour demands of the resources sector with a crisis management strategy.  The long-term impacts of heightened demand for resources on skill formation and on the training of workers across the economy, should be the primary driver of policy in this area.

From a National perspective, heightened resources demand for labour should be an opportunity for developing and retaining skills across the economy. 

The resources industry does not train its share of workers and it increasingly imports temporary overseas skilled labour

Planning for the long-term needs of the resources sector is paramount so that policies and practices generate the best outcomes for the mobility, productivity and skills development of the economy as a whole.

The resources industry cannot treat the rest of Australia like a magic pudding which endlessly replenishes it’s desire for skilled labour.

Skills shortages are not only the result of under-investment in training.  Skills shortages are also the result of local content for resource projects being sent offshore.

Having shifted work offshore, employers are now demanding the right to import their labour.

As you know, traditionally, fabrication shops trained the welders, fitters and boilermakers.

Who is going to train those apprentices now that most of the fabrication work is being sent offshore?

Many of you will be aware of the AMWU and the local manufacturing industry’s campaign in WA called WA Jobs from WA Resources.

We have designed this campaign to spur the the WA and the Federal Government to take local content seriously – especially if the resource industry does not take responsibility for it.

More attention should be put into planning projects to maximise the benefits for both the resources and the local manufacturing sectors.

The resource industry has to take a broader view and ask yourself –

How much cheaper is it to get the content offshore when so much of that work has to be re-done?

How effective is it to bring 457 visa workers onsite who are not well-trained or up to speed?

A broader economic approach could increase the longevity of the mining boom and mitigate the affects of the two-speed economy.

Project Cycles

I also accept it is difficult to manage capability over the peak and trough cycle but we do have an opportunity over the next few years where we know there is a lot of work coming down the pipeline.

We should work at an industry level to try and co-ordinate the timing of these projects where possible and maximise our capacity to retain the skilled workforce.

Mobility between projects

Another challenge which will emerge is competition for labour between projects in QLD and WA.

One way of addressing this will be to create more worker friendly shift patterns, particularly in WA, as this will accommodate the extra travel involved for FIFO workers who live on the east coast.  More attractive shifts will need to be offered in WA to compete for labour as projects in Queensland pickup.

For example, instead of 28 days on and 7 off, you might want to look at 26/9.

Our Union supports the NRSET recommendation of an inquiry into FIFO – a lot needs to be done in this area.

3. Finally, could this industry get a better overall result if companies, unions and the government all worked together to address these issues at an industry level?

The tripartite bodies set up in several sectors of the manufacturing sector have achieved significant outcomes for those industries.  The auto-industry, the defence industry and the broad manufacturing industry all have tripartite councils.  I believe that a resource industry council would help this industry to tackle its major challenges.

For example, the auto industry council addressed the challenges of the GFC by, among other things, moving to 4 day weeks with government training programs. At the peak of the crisis in Holden, the workforce moved to 1 week on, 1 week off – a radical solution which kept employment and maintained skills and is the reason Holden has recovered so quickly.

The issues I have raised around training should be addressed at an industry level in my view.

Why can’t we plan an industry strategy to transfer workers from one project to another? Only by taking an industry wide approach, can we work out how to maintain capability through project peaks and troughs. 

It is the view of the AMWU that the interests of the resources sector can be best served by the establishment of mechanisms for broad skills development that can serve the needs of the sector as a whole.

The NRSET was a tripartite body that was put together to look at tackling skills shortages in the industry.  It met over a relatively short period of time and has come up with a raft of recommendations which the Government is now considering.

Why would we not continue the work of that body through a Resource Sector Industry Council?  We need continuous improvement and we need to keep such a body to be able to deliver that. 

Conclusion

In my opening, I talked about the days of the gold rush in Bendigo and Ballarat.

As labour-intensive as those days were, the contribution that those miners made to the community can still be seen in the grand public buildings in those towns and in Melbourne, where I live.

What will be the legacy of this generation’s mining boom?

It definitely should not be a devastated manufacturing industry.  The government has a responsibility to enact economic policies to ensure that the effects of the mining boom do not destroy our manufacturing sector.  It has a responsibility to ensure that a fair percentage of the wealth generated from Australia’s natural resources ends up benefiting all Australians, not just those employed or with share portfolios in mining.

Workers in other industries whose superannuation may be benefiting from the boom are still not better off overall if they lose their jobs due to an out of control exchange rate.

When it comes to resource workers benefits, it’s not just about high wages, it’s about regular and secure employment, training and up-skilling, as well as opportunities for their children through apprenticeships.

I’m all for a genuine discussion about improving productivity in the resources sector, and I’ve outlined some clear ideas in that area today.

But I’m also mindful that the benefits of productivity need to be shared amongst all Australians and the best way to achieve that is to build a diverse and sustainable economic base for beyond the mining boom.

Thank you.