A multinational resources company will go back to the drawing board after the industrial relations watchdog rejected pay and work conditions for outsourced employees.
The Fair Work Commission has ruled BHP Operations Services (OS) employees never accepted two labour hire agreements, meaning terms and conditions in those documents cannot be legally enforced.
“[We are not satisfied] that the production agreement or the maintenance agreement were genuinely agreed to by the employees covered by the agreements,” vice president Adam Hatcher, deputy president Anna Booth and deputy president Alan Colman said in the full decision.
The full bench blamed BHP for failing to comply with part of the Fair Work Act by not reaching a formal agreement with OS workers.
“Undertakings proposed by [labour hire entities] OS MCAP and OS ACPM have not met the concerns we hold about their failure to satisfy the s186(2)(a) approval requirement [stated in the Fair Work Act],” the trio said. “Accordingly, the agreements cannot be approved [and] we dismiss the applications for approval of the production agreement and the maintenance agreement.”
The Construction, Forestry, Maritime, Mining and Energy Union (CFMEU) previously accused BHP of using a small number of iron ore workers in Western Australia to vote on the two agreements before trying to roll out the same pacts to the employer’s coal mining workforce in Queensland and New South Wales.
Up to $50K worse off
This meant some labour hire workers were allegedly paid between $30,000 and $50,000 a year less than their permanently employed BHP counterparts at coal operations, even though they wore BHP uniforms and performed the same work. Other benefits like workplace accident compensation and annual pay rises were also not included.
CFMEU believes the proponent should apologise to affected workers for the “dodgy” enterprise agreements.
“These tricky, toxic agreements belong in the bin and that is exactly where the commission has finally put them with this decision,” CFMEU Mining and Energy president Tony Maher said in a public statement.
Christmas penalty rate
There is now potential for more than 2000 OS employees to be offered more attractive incentives since the previous agreements did not pass the “better off overall test”.
The union wants BHP to hire OS workers under existing site agreements, and to pay penalty rates for anyone rostered to work on Christmas Day and Boxing Day.
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