Workers' huge court win over mining giant

Perth Now

2 days ago

Some 2200 coal mine workers in Queensland's Bowen Basin are in line for a $30,000 pay bump following a landmark ruling from the Fair Work Commission against mining giant BHP.
The Mining and Energy Union and Australian Manufacturing Workers' Union took the $200bn behemoth to court over the Same Job Same Pay reforms.
Passed in 2023, the changes are designed to equalise pay rates between direct hire and labour hire employees at large-scale enterprises if they are performing the same job.
The unions argued BHP had undercut worker wages at its coal mines by using an in-house labour hire service called OS Production and Maintenance.
Late Monday evening, the FWC determined the work performed by OS employees at the company's Saraji, Peak Downs and Goonyella Riverside mines was not 'for the provision of a service, rather than for the supply of labour' and so delivered 'regulated labour hire arrangement orders'.
The orders clear the way for average worker pay bumps of $30,000 at a cost of $66m to the company, the ACTU has claimed. BHP operates the Caval Ridge Saraji, Goonyella, Broadmeadow and Peak Downs coal mines in central Queensland with Mitsubishi. Supplied Credit: News Regional Media Union workers have long been incensed by discrepancies in pay between labour hire and direct hire employees at BHP. NewsWire Credit: News Corp Australia
'This is about Australian unions winning wage justice for workers, which stops labour hire workers being treated as second-class citizens,' ACTU secretary Sally McManus said after the ruling.
'Wealthy mining companies like BHP have clawed money out of workers' pay packets for many years when the income should be returned to workers, their families and the communities they support.'
Several factors contributed to the ruling.
First, the FWC determined BHP held significant control and direction of where OS employees would work, what they would do and details of how the work would be performed.
Second, the workers were compelled to adhere to 'detailed and highly prescriptive requirements imposed by BMA (BHP Mitsubishi Alliance)'.
Further, the FWC found OS workers used 'virtually entirely, plant and equipment supplied by BMA to perform work'.
'That consideration supports a conclusion that the work performed by employees of OS Production is not for the provision of a service, rather than the supply of labour,' the bench ruled.
It also concluded that although the work performed by OS employees might be specialised, it was of the 'same nature and involves the same specialised and expert skills as are exercised by employees of BHP Coal performing the same work'.
The ruling also covers employees with labour hire companies Workpac and Chandler McLeod, who the commission found were 'performing the same work in the same crews and BMA employees and receiving substantially lower remuneration because of the identity of their employer'.
The landmark decision could up-end labour arrangements across the country's massive and lucrative mining sector.
Minerals Council of Australia CEO Tania Constable called the decision 'incredibly disappointing' and said it would 'directly threaten thousands of specialised contractors who play a vital role in mining operations across the country'. Minerals Council of Australia CEO Tania Constable called the decision 'incredibly disappointing'. Supplied Credit: Supplied
'Unlike labour hire, these businesses exist to provide a specialised service, not just workers, and should never have been covered by these laws,' she said.
'These businesses now face the risk of being drawn into complex and costly legal proceedings, creating instability in employment arrangements that have long supported operational flexibility, efficiency and mining productivity.
'The commission's ruling confirms what the MCA has long argued: that the government's legislation goes well beyond its original promise to target only the 'limited circumstances' where 'labour hire' is used to deliberately undercut wages.'
BHP, meanwhile, has railed against what it sees as an escalation in excessive cost burdens on its Queensland operations, citing complex industrial relations demands and the state's sharp coal royalty regime.
The company has reduced its footprint in the Bowen Basin in recent years, offloading its Daunia and Blackwater mines to Whitehaven Coal in April last year.
It now runs five mines in conjunction with Mitsubishi: Saraji, Goonyella, Caval Ridge, Broadmeadow and Peak Downs.