Mining sector innovates on IR

Resources businesses are developing innovative workplace relations strategies in response to a lack of reform from government, as costs come under continued scrutiny due to low commodity prices.

Australian Mines and Metals Association director of legal services, Amanda Mansini, said one development was an increasing usage of partnership structures, where employees became part owners in a business.

Partnership structures had been used in sectors of the marine industry since the 1980s, she said, with tugboat operators now adopting the practice.

A crew of more than three and up to 20 would use a partnership for the running of a boat, and then put forward a tender for work.

The benefit for employers was that it provided an incentive to lift employees’ performance and productivity, given they would have a share of the improved profitability generated, she said.

Employees would not have lower wages, although it would change the nature of their relationship with their employers.

While this was an example of the businesses’ efforts to drive reform, it would be preferable for the federal government to tackle industrial relations issues head on, Ms Mansini said.

IR issues

Industrial relations matters were a key focus at the AMMA’s recent conference in Perth, with overall support for reintroduction of the Australian Building and Construction Commission, which was the trigger for the July 2 double dissolution election.

Seyfarth Shaw partner Henry Skene said the ABCC would be particularly important for Western Australia, Queensland and Victoria, where the industry had more significant issues than other states.

Studies had shown that the impact would be dramatic, he said, possibly decreasing the cost of construction projects by 20 per cent.

Two of the major changes included in the ABCC Bill would be a tripling of penalties for breaking of industrial law, and a new code for federally funded infrastructure projects.

Corrs Chambers Westgarth partner Simon Billing said the code would be an economic lever, because it restricted enterprise agreement content and prevented cosy arrangements about site access.

“Experience has shown that imposing penalties, engaging the Construction, Forestry, Mining and Energy Union in litigation, doesn’t actually change their behaviour,” he said.

“The big stick over the head at the CFMEU has been tried for decades and can anyone seriously argue that it’s made any difference?”

The CFMEU has racked up more than $1 million in fines in the eight years to 2013, just for actions involving WA assistant secretary Joe McDonald.

Mr Billing said cultural change, which would be created by the proposed changes, was key to improving activity in the sector.