A pattern is emerging in the building and construction industry – a pattern of battles not between capital and labour but between labour and labour. More specifically, union versus non-union.

Heave, ho. Photo: Herald Sun

In what looked like escalating into a Grocon Mark II dispute, unionists blockaded the Little Creatures brewery in South Geelong on and off for more than a month until last week in breach of a Supreme Court injunction.

Unionists from the Construction Forestry Mining and Energy Union (CFMEU) and the Australian Manufacturing Workers Union (AMWU) have been in dispute with Western Australian contracting firm TFG Group over the use of non-union contract workers at the Little Creatures brewery.

The unions object to the employment of non-union labour on individual contracts, and are demanding that TFG employ local workers from Geelong on an enterprise bargaining agreement.

The new brewery represents a $60 million investment from Lion, Little Creatures’ parent company, and TFG has been hired to administer the fit-out of specialist brewing equipment. According to Little Creatures, 95% of TFG’s contractors are Victorians, and the brewery will offer significant opportunities for local jobs upon its completion.

The CFMEU and AMWU claim that TFG has engaged its labourers in sham contracts to avoid paying entitlements normally afforded to regular employees, such as sick and holiday leave, superannuation, and redundancy payments.

But if unionists were really worried that TFG was engaged in sham contracting, they only need to refer the matter to the building and construction industry watchdog. No such action has occurred.

This dispute is not about workers’ rights or sham contracting. According to Leela Sutton from Lions, the workers have indicated satisfaction with their conditions and do not wish to be represented by the union. This dispute is about growing membership through intimidation and boosting membership fees.

In an economy where just 18 per cent of the workforce is unionised, workers ought to have the right to union representation, but equally, workers ought to have the right to represent themselves, free from a meddling union.

Gone are the days of the 1970s when one in two workers was a union member and unions had a guaranteed place at the bargaining table.

The Fair Work Act has a place for unions but it does not authorise a group of unionists who do not even work at a site to blockade it and prevent workers from entering and earning an income.

Under the Fair Work Act there are several ways in which employees can gain union representation. Every worker has the right to associate and be a member of a union. The union is also the default bargaining representative for any employee who is a union member.

However, in this case the specialist workers are contractors, not employees.  As such they are employed under commercial terms, not regular employment terms. This means if the workers wish to be unionised, they would first need to become regular employees of TFG. Only then should the union be involved.

But there is also a bigger story. The building and construction industry has long had a reputation of militant union activity, and the CFMEU has long-standing reputation for thuggish behaviour.

The Cole Commission (2001–03) was established to investigate the degree of lawless and criminal behaviour in the building and construction industry, and its report found widespread disregard for the rule of law, particularly in relation to illegal strike activity, pattern bargaining, and intimidation tactics.

To remedy this problem, it recommended establishing a watchdog – the Australian Building and Construction Commission (ABCC) – to police the sector.

The ABCC has had positive effects on the industry, including a reduction in illegal strike action, pattern bargaining and intimidation, and an increase in productivity. Unfortunately, the ABCC was replaced with a new watchdog this year, Fair Work Building and Construction (FWBC). The new watchdog has reduced powers compared to its predecessor.

Most significantly, the maximum fines that can be imposed by the commissioner on organisations (or unions) and individuals have been reduced.

Several in the business community, including the ABCC’s former commissioner John Lloyd, believe that watering down the commission’s powers has weakened its deterrent effect and emboldened the union movement.

Times are tough for manufacturing in Victoria. Qantas has just sacked 250 heavy maintenance staff from its Avalon facility, 440 jobs have been cut from Ford’s Geelong plant, and a further 50 workers are expected to be sacked from Alcoa’s smelter in Point Henry.

At a time when local communities in Victoria need all the investment and job opportunities they can get, the industrial campaign at Little Creatures in Geelong serves as a deterrent to firms considering investing their time and effort in Victoria.

Comments on this post close at 8pm AEST

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    • Don says:

      06:55am | 29/11/12

      Don’t forget the debacle of the desalination plant as well. Large capital project in Victoria? Pfffft no thanks.

    • Borderer says:

      08:54am | 29/11/12

      The action to deter unions from illegal strikes is simple, the union will be fined double the economic cost incurred by the business. Unions should not be gutted by zealous employer groups but they should not think they are above the law either. A financial penalty of such magnitude would result in unions respecting court decisions as opposed to their present free reign under the ALP.

    • FlyOnTheWall says:

      11:12am | 29/11/12

      Yet another court order being ignored by the CFMEU in Victoria… again, not enforced by local authorities.
      And to think, we supposedly have a “conservative” government in Victoria, but not once in all these illegal pickets, have the police, or anyone in authority become involved. So many illegal pickets, and not any action - the CFMEU appear to rule Victoria.

    • stephen says:

      07:39am | 29/11/12

      If Little creatures is nowhere to be seen, then try the new recipe VB - it is a very nice drop.

    • scott says:

      09:27am | 29/11/12

      No thanks, I am not a low-class bogan!

    • Beer Bear says:

      02:16pm | 29/11/12

      @Scott no, you’re obviously much worse

    • stephen says:

      04:06pm | 29/11/12

      ‘Hey ma, some bloke reckons that we’re bogans coz we like VB’
      ‘He says what ?’

      ‘He says that…’
      (aside) ‘Hey, get off me would yer ?’

      ‘He reckons VB is ... ‘
      ‘He says I got what ?!’
      ‘Well, VB is OK here, and ...’
      ‘Yer father says this is a Tooheys house, and when he gets home, don’t you say nuffin else ... hear ?’
      And hang up on’im, hear ?’

      ‘Yes’m ‘

      ps Beeeeeeeeeeeeeeeeeeep.

    • daniel says:

      08:23am | 29/11/12

      Nowadays, many Australians can see what unions are trying to do in workplaces. The lack of strong deterrence and declining membership might have emboldened them in recent times but the increasing loss of jobs in manufacturing, for example, due to the economic conditions has spurred them on to argue that it’s the employers short-ending local workers. Clearly, that’s not the case and many people can see that their real gripe is with the high amount of non-unionised contract workers.

    • jimbo says:

      08:48am | 29/11/12

      Give the workers a break from militant unions and bring back Work Choices.  It worked!

    • I hate pies says:

      08:51am | 29/11/12

      The CFMEU are the bottom of the barrel. Their actions are actually usually to the long term detriment of their members.

    • Kev says:

      08:52am | 29/11/12

      I’m surprised any company bothers building anything in Victoria. Their defenders will claim that unions are there to ensure fair pay, regulated work hours and fair conditions but that’s nothing but bullshit. Everyone knows it is all about finding any excuse to stop work whilst getting paid a fortune.

    • Steve says:

      09:17am | 29/11/12

      From your article, I presume the Victorian Police were doing their usual Sargeant Schultz routine about illegal industrial action and blockages.

      Until The Age starts writing about inconvenience to the (inner city) public, the Vic coppers like to leave unionists to their own devices.

    • St. Michael says:

      05:52pm | 29/11/12

      That would mainly be because police forces are themselves heavily unionised.  Solidarity forever!

    • Mick In The Hills says:

      09:32am | 29/11/12

      A single union formed as a representative entity of a particular workplace can have a very effective role.  Such as operate in Germany, I believe, where productivity is ever-growing.

      What we have now in Australia, economy-wide trade unions which impose themselves into targeted workplaces, is a disaster for both worker representation, efficiency and productivity.  They are well past their use-by date, as evidenced by only 13% (imposed) membership in the private sector.  It is the laziest form of union existence.

    • Richard M says:

      09:37am | 29/11/12

      Firstly, can we just get clear that Mr Philipatos works for the Centre for Independent Studies, an extreme right-wing think tank.  His “analyisis” should be read in that light..  Secondly, while I’m not aware of the details of the dispute he is referring to, surely it is legitimate for unions to concern themselves with the erosion of hard won conditions like sick and holiday pay, super and redundancy entitlements?  We saw what happened to these entitlements when there was a proliferation of individual contracts during Work Choices.  Anyone who actually believes that these workers are really independent contractors should perhaps join the CIS, because they are highly susceptible to right wing propaganda.  As for the workers saying they are happy with their conditions, well, they would say that wouldn’t they?  Perhaps they are just happy to have a job and want to keep it!
      As for the ABCC, it is interesting that the thing that did deteriorate markedly during its tenure, and as non-union jobs have proliferated in the industry, is the safety record, which is at historical lows - ie the numbers of workers injured or killed on the job has risen markedly in recent years, as the pressure on costs and time have increased and the level of union oversight has decreased.
      Funny, Philipatos doesn’t mention this.  But then they are only workers - their safety is not really a priority.

    • I hate pies says:

      10:12am | 29/11/12

      Well, well, well; wasn’t that the quintessential rant. It’s about safety! It’s never about safety, and it’s never about the members, but it’s always about power.
      And regarding workers killed on the job - why don’t the union let the companies do drug and alcohol tests? Surely if it was about safety they would allow that. Most incidents are actually caused by people not following the rules, not by the rules not being in place.
      Entitlements in the construction industry are far beyond every other industry in the country, even mining. It’s a big reason why companies don’t want to invest here - $130k a year for a labourer; absurd

    • Ben says:

      10:30am | 29/11/12

      >>Firstly, can we just get clear that Mr Philipatos works for the Centre for Independent Studies, an extreme right-wing think tank. 

      Firstly, let’s just poison the well, so to speak, shall we? Incidentally, tell me more your definition of “extreme right-wing”. Are we talking, you know, white supremacist, end women’s suffrage, concentration camp sort of stuff?

    • expat says:

      10:36am | 29/11/12

      Unions do not benefit many workers, unions benefit the average or below average worker.

      A union is designed to normalise a workforce, that is a group of people will come to work, be equally productive for equal pay. It is a regressive strategy that is ever so quickly making Australia so unproductive it is not funny.

      An independent contractor acts as a micro business, under this arrangement the benefits shift towards the most productive and highest quality individuals who can demand higher rates. This is a progressive strategy and is far better for those who are above average workers.

      For example as it stands now, two people go to work to do the same job for 8 hours for the same $30 per hour loading containers onto ships.
      Person A averages 15 containers per hour.
      Person B averages 20 containers per hour.
      Which person is entitled to a better rate?

      Under the current unionised system, person B is 25% more productive than person A, yet entitled to not a cent more than person A. In order for the unions to protect person A they must encourage person B to slow down, because that person is making the rest of them look poorly.

      Under a contractor scheme, you could rather negotiate with them $2 per container loaded, paying directly for productivity, a far more efficient option and beneficial for both those who work harder and the business.

      You mentioned safety, well you cannot completely remove risk, its unpractical to do so, I am sure acotrel can fill you in on risk management. By using a contractor type system the risk and responsibility now becomes shared between the company and the contractor. Shared risk and responsibility will deliver far better safety levels than company only risk and responsibility.

      The only reason anyone would be against this type of system is if you fall into the below average category. Unions are full of these below average, lazy types.

    • daniel says:

      11:50am | 29/11/12


      You hit the nail on the head (pardon the pun).

    • Kev says:

      11:56am | 29/11/12

      This has nothing to do with pay and conditions and safety and everything with gouging as much pay in return for doing as little work as possible. I hate pies has a point, if unions are there to ensure safe working conditions then why not allow for the drug testing of workers particularly heavy machinery operators? To anyone else this just makes common sense. Everyone except unions. It doesn’t matter how skilled you are no labourer is worth 6 figures a year.

    • capsicum says:

      01:51pm | 29/11/12

      Workplace safety? Pull the other one, champ. It’s all about holding companies (big or small) over a barrel along with honest working people in order to extort money. Ever notice how the CFMEU seems to walk off the job whenever a big project is nearly finished? Especially when there is a completion bonus at stake.
      Why would anyone join a union these days unless they were too lazy to do honest work?  Why should hard earned money go to support bullies, thugs and corrupt officials?

    • Bris Jack says:

      09:43am | 29/11/12

      Royal Commision .
      At present the union is the puppet master controlling the strings of the puppet, the labour gov.

    • Modern Primitive says:

      09:47am | 29/11/12

      The unions will destroy they very jobs they aim to protect if they continually price labour out of the market. There is absolutely no reason for them to be so adversarial either, in Germany unions work with employers instead of against them for fair conditions.

      If unions don’t come into the 21st century they are doomed.

    • Steve says:

      10:28am | 29/11/12

      Agree that with their current culture, unions are doomed - but not before a whole lot of jobs head overseas, or are not even created in Australia. 

      Why would you start a factory in Australia if you can start it elsewhere?  Anyone?

    • Kev says:

      12:05pm | 29/11/12

      I’ve always found it ironic whenever a company is on the verge of downsizing or closing up that unions never ever offer to take a pay cut in order to help the company stay in operation. No the fault always lies with management and never the worker who is being paid a fortune in an unskilled job.

    • AdamC says:

      10:13am | 29/11/12

      The CFMEU and the AMWU are the most prehistoric of Australia’s union dinosaurs. There is no place for bully-boy unions in the 21st century, yet the Fair Work regime heaps powers and privileges on these economic vandals.

      The Grocon debacle was a classic. The company negotiated a union deal with the CFMEU (which itself would have been like pulling teeth). The CFMEU then tore up the deal, with seemingly no basis, and went on strike demanding that their own enforcers be paid by Grocon as ‘safety officers’. The union then blockaded the site, in violation of court orders, and eventually the police had to become involved, with horses and riot gear.

      That should not happen in an allegedly dynamic, modern economy in the Asian century. The whole affair had nothing to do with workers rights and made Australia look like a lawless, third world economy.  Sadly, we have a PM that still treats union aristocrats as her clients, as she did when she was advising on setting up their slush funds.

    • Kev says:

      12:08pm | 29/11/12

      If they tried to pull this stunt in China all of them would be out of a job and rightly so. It’s a pity they can’t do that here.

    • JB says:

      01:09pm | 29/11/12

      @Kev, No mate, they would all be loaded on a bus and sent away for “Re-education” or just shot for failing to return to work. Either option sound fine to me.
      Unions are just thugs that want more money for less work.
      They are weak as PISS, just look at the sterling job the TOGETHER union has done for Queensland public servants!

    • Kev says:

      01:19pm | 29/11/12

      @JB - You’re probably right actually. Whilst I wouldn’t look to China as an example for safe construction, design standards and pay and conditions for workers their overall attitude towards getting the job done is something construction workers here need to learn. We have it so good here that we bicker and stop work over non-issues. Builders here need to toughen up.

    • Anjuli says:

      10:15am | 29/11/12

      I thought this is a democratic country ,why can’t employers employ the best man for the job without having to ask a lazy union rep .

    • SAm says:

      11:07am | 29/11/12

      Action like this should render any employees activly stopping other employees from working as fired..I dont see how this wouldnt be the end result, union or not

    • Greg says:

      11:27am | 29/11/12

      I would rather eat crushed glass than be in one of these filthy unions with their uneducated, theiving ‘executives’. Seriously you union grubs, your time is VERY close at hand, If I was a union employee, I would be looking for another job, preferably where you are NOT a parasite living off worker’s wages. PS. Leave the union employment off your resume.

    • Shane From Melbourne says:

      02:37pm | 29/11/12

      Construction industry pay rises = bad, Police, Politicians pay rises = good. Corruption in construction industry must be rooted out immediately, corruption by politicians = let them investigate it themselves. Nice little dichotomy here in Victoria….


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