IF you were labouring under the misapprehension that 12 months of tension between Patrick and the Maritime Union of Australia had ended with agreement back in August, join the club.
It turns out that the four-year enterprise agreement revealed late on August 18 wasn't so much an agreement as a "framework" that set the terms for an "in principle agreement" for container terminal workers.
In the end, that framework, over which handshakes were traded between company and union management, didn't even make it to the vote of workers that was necessary for its final endorsement.
Instead, we have deja vu, with a long weekend of work bans and worse at bulk ports around the Patrick nation, along with an obviously predictive 24 hours worth of stoppages at the Fremantle container port.
Patrick is preparing for another 48 hours of action at BlueScope's Port Kembla docks through next week, and if the MUA's return to militancy runs to previous form we will see the work bans and strikes right across Patrick's commercial heartland, the east coast container terminals, just as in April, when discussions hit a similar impasse.
On the face of it, Patrick seems to have been well and truly outflanked by the MUA when terms appeared to be agreed a couple of months back.
Ahead of that August framework being settled, the company had been actively contemplating the same sort of circuit breaker currently being attempted by BHP Billiton in its equally long-running negotiation with the coalmining unions in Queensland.
Last month, BHP walked away from negotiations with the three unions, preferring a direct ballot of workers on its proposed enterprise agreement.
Patrick's plans to do exactly that were abandoned with August's handshakes. But now, frustrated and not a little grumpy, Patrick management says it cannot afford to wait on a new agreement to start the productivity push.
It has informed the union it will use the options available to it under two key clauses of the existing agreement to manufacture the continuous operation it wants and needs.
According to Patrick, the old deal provides for roster and other operational changes to deal with the congestion at the heart of Australia's historic portside productivity gap.
Whether this represents realistic design or just louder negotiating rhetoric, it is difficult to see how the MUA can respond with anything but more industrial action in the face of what will be seen as provocation. So half of the country's ports have been returned to a treadmill of confrontation entrenched by a twofold failure of the design of the Fair Work Act. The Gillard reforms have put management's right to manage at the forefront of the unions' agenda and created no sensible mechanism to cut through when a negotiation becomes deadlocked.
The really miserable development, since Patrick went all Neville Chamberlain and declared peace well before its time, is that the company and the union had come up with an admirable framework that delivered workers what looked like a healthy financial outcome, predicated on achieving material productivity offsets.
The idea was that the terminal workers would get four years of annual wage increases of 4.75 per cent with an additional 1 per cent contingent on meeting safety and productivity benchmarks.
In return, the unions agreed to operational reforms that would generate an estimated 12 per cent lift in productivity across the business.
This opportunity for a quality win-win outcome looks to have been squandered, and predictably each side blames the other.
The MUA last week described talks with Patrick over the details of the August accord as "almost akin to negotiating with corpses". Mind you, Patrick's negotiators went into those talks thinking this was a deal largely done, so the idea that they would entertain issues and options raised and consistently rejected for more than a year now left them understandably dumbfounded.
On the bulk and general front (and to be fair to all involved, this is a negotiation that has not yet come close to being done with), the union continues to insist on a reduction of employment grades that from Patrick's perspective just doesn't add up.
These are operations that sit constantly on the edge of financial extinction, yet the union is asking the company to accept changes that would add $23 million to the annual wages bill over the four-year life of the deal without offering productivity offsets.
The sticking point for productive discussion on the container terminals "framework" is rather more arcane but no less fundamental to the overall financial outcomes. The union wants the new enterprise agreement to install Fair Work Australia as the arbitrator of any dispute over rosters or work practices.
On the face of it, the MUA would appear to be trying to mitigate the impact of any commitments on productivity by manipulating a return to the good old days of what Patrick calls "co-management" through the introduction of an arbitration process.
Some might imagine this a reasonable request, but it is a step backwards and a big one. Its acceptance would involve Patrick paying wage increases from day one of the agreement while running the risk that each and every time it introduces reforms aimed at recovering those increases through matching productivity gains it would be resisted by the unions and then formally assessed by Fair Work.
At best then, the productivity offsets will substantively lag the pay increases. At worst, the offsets might not arrive at all while Patrick is forced to run any and all management initiatives past the union leadership.
In the end, the real issue is Port Botany. Patrick's ambitions for productivity rest almost entirely on transformative reform at Port Botany, and its workers have made it clear to the union and to management that they are opposed to change.
Patrick asserts that productivity at Port Botany continues even further behind national and international benchmarks. The key Sydney container terminal runs at 140-160 crane lifts per shift. That compares with 210-215 in Melbourne, which uses substantially the same equipment with comparable staffing.
Congestion is so bad that some Patrick customers have chosen certainty over expense and sent three consignments of boxes (some 900 containers in total) by rail to Melbourne rather than risk shipping out of Port Botany.
Patrick maintains this is an unacceptable outcome, and it is quite right. Port Botany has resisted the modern world for far too long. The time for change has come and no one appreciates this more than the man ultimately responsible for Patrick, Asciano's new boss, John Mullen.
The way I hear it, Mullen rates reform of Port Botany as his greatest challenge and its successful achievement as the bequest he would most like to leave Asciano shareholders.
Game on.
Tuesday, October 4, 2011
Bitter battle brewing on waterfront reform | #MUA
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