Victory

Photo Courtesy Newspix

Another battle won in the protracted struggle to defend Australian shipping

MUA crew took a stand on board the CSL Yarra in Port Pirie, May, 2002 And the battle for Australian seafarers to have the right to work in Australian waters has been fought out in the courts and on the ground ever since.

CSL has remained on the coast flying the Bahamas flag. Others have joined them. But the High Court victory giving Australia jurisdiction over ships on our coastal trade this August, may ultimately see an end to FoC shipping unfairly competing with Australian sea, rail and road transport.

An Australian award for foreign seafarers working on our coast -- this is the next step the unions are taking after their stunning victory in the High Court against Canadian Steamship Line and the Federal Government.

On August 7 the full bench of the High Court dismissed an appeal by CSL and the government claiming the Australian Industrial Relations Commission had no jurisdiction over foreign flagged vessels trading in our domestic transport industry.

It is undoubtedly the biggest court victory for maritime workers since the 1998 ruling against Patrick and the Federal Government.

Over 15 long months of court actions, CSL argued that flagging out the former Australian vessels CSL Yarra and River Torrens and bringing them back on the Australian coast was no different to Australian manufacturing companies going offshore to reduce labour costs.

CSL claimed it was above Australian law and their trade came under 'free passage' and the law of the sea.

The maritime unions (MUA, AIMPE and AMOU) and the ACTU countered by saying CSL were involved in a corporate ship shuffling exercise to avoid tax and that the foreign crew trading in our domestic transport industry were effectively guest labour.

In September last year the full bench of the Commission agreed that vessels trading domestically were under the jurisdiction of Australian labour law.

CSL appealed to the High Court. But the Court has unanimously upheld the jurisdiction of the commission and Australian sovereignty.

"The court verdict is a major blow to foreign shipping and the Howard Government," said National Secretary Paddy Crumlin. "These ships have been exploiting loopholes in the Navigation Act and using single voyage permits to undercut Australian shipping courtesy of the Federal Government. This decision will have widespread repercussions on all coastal shipping."

"This once and for all settles the employment law regulating the operation of foreign shipping on the Australian coast," said union lawyer Bill McNally. "The commission now has jurisdiction over foreign ships and crew carrying Australian domestic cargo. It also has the right to enforce local rates of pay and conditions on foreign shipowners."

Since October 2001 CSL Pacific has plied its trade on the Australian coast carrying dry bulk cargoes of cement powder, cement clinker, gypsum and slag for Australian customers between Australian the states of Victoria, NSW, SA and Queensland.

It left the coast only once for 10 days from March 30, 2002 when it sailed to New Caledonia and back.

CSL's second ship, the Yarra, was the centre of a 16-day sit in by MUA crew in Port Pirie last May. CSL subsequently reneged on an agreement to leave the trade open for an Australian vessel to carry the cement run, bringing the bulk carrier back on the coast under the Bahamas flag with a Ukrainian crew.

But the High Court decision upholds the union contention that the company is operating within Australian territory and is therefore subject to Australian law.

The decision made headlines nationally and internationally. Maritime unions in the US and New Zealand also made the win for cabotage front-page news in their publications.

The implications for foreign carriers operating in Australian waters are serious, according to broadsheet Lloyds List DCN Australia - especially for those with long-term contracts in bulk commodities.

Foreign ship owners staying in the trade do not just face greater labour costs.

The matter has since gone back to the Commission where on August 15 Commissioner Raffaeli dismissed a CSL application he should not consider any further union submissions.

The Commissioner, however, made reference to CSL arguments about ship's maintenance, crew swings, the dig out, leave and overtime, currently ruling out the existing Seagoing Award for foreign flag vessels.

CSL also argued the Australian award was inappropriate because public holidays like Anzac Day and the Queens birthday were not relevant to its Ukrainian crew.

So MUA and AIMPE are submitting a new award for the CSL vessels. What's more the unions will use this award as a template for all foreign flag vessels which regularly trade on our coast under the permit system.

The union position is any award has to be based on the Maritime Industry Seagoing Award which has already been determined to be the minimum national standard for shipping.

An award, which already has the in-principle support of the Commission, will not only go a long way to stamping out exploitation of labour in our waters, it will make Australian shipping more competitive.

"Now all that remains is to go after rogue operators who are consistently abusing the voyage permit system egged on by the Federal Government," said Crumlin.

Those the unions already have on their list are the previously Australian crewed Wallarah and Sandre Marie, now trading as the Ikuna and the Hakula.

The MUA has also registered a dispute with the Commission over Gearbulk's three Arrow vessels trading bulk fertiliser up and down the coast between its international voyages. The Commission listed this dispute for hearing alongside our existing claims on the ISM and CSL vessels.

The aim is to have all seven vessels under a bulk ship trade award specifically for foreign flag vessels. For example the new award will need to recognise the lower training of the foreign crew, none of whom hold the world standard integrated rating.

Shipping commentators have speculated that once the union is successful with the bulk trade the way is open for a second award covering vessels on the west coastal liner trade linking Sydney, Melbourne and Fremantle. Foreign flag container ships currently carry this trade at half the cost of Australian rail or road transport across the Nullarbor. They include big name companies such as P&O Nedlloyd, MSC, MJISC, MOL, OOCL, PIL, APL Djakarta Lloyd and Wilhemsen.

News that foreign vessels will no longer operate on the cheap has already had the desired reaction. Lloyds' List DCN reports some shipowners in Australia's domestic bulk trade are signalling that additional costs would have to be passed on to the charterers.

David Roylance and Gavine Vallely, partners in Middleton's Melbourne Transport and Trade Group, warned that foreign operators were likely to withdraw from the Australian coastal trade upon expiry of their contracts, given Australian shippers are unlikely to pay for increased freight costs (Lloyds List DCN, 14/8/03). They also claimed this will lead to freight rate hikes as demand exceeds supply.

"That's bullshit," said Crumlin. "They're crying because they'll have to be held accountable to Australian laws for the first time, poor buggers!"

CSL has reacted predictably. CEO Chris Sorenson at first claimed the company has always paid their crew Australian wages. Now he claims they pay ITF rates - although the ITF terminated the agreement due to it undermining Australian cabotage. CSL employs some 27 Ukrainians on each vessel compared to the 16-17 Australian seafarers per swing.

Sorensen gave evidence during the hearing that the annual cost of employing crew for its two ships under the award was $2 million more than it is now paying its Ukrainian employees.

Tremendous pressure is now on CSL to either vacate the industry or return to employing Australian crews.

As for the Howard Government, which backed the foreign ship owner in the courts, it too is unapologetic.

CSL acquired the former ANL bulk carriers River Torrens and River Yarra from the Federal Government through its Australian subsidiary in 1999. It soon transferred the vessels to another CSL company based in Barbados, employing a Ukrainian crew and flying the Bahamas flag.

Both vessels returned to the Australian coastal trade on permits issued at the discretion of the Minister for Transport and Deputy PM John Anderson.

The Transport Minister has made it clear cheap freight rates for his rural constituency are much more important than the long term threat to security, crew safety, the environment, Australian labour standards or the GDP in lost revenue.

The federal attorney general supported CSL's argument all the way to the High Court. Now the government would need to amend the Workplace Relations Act to exclude foreign owned and foreign-crewed vessels operating under the permit system, from AIRC jurisdiction. The Senate is unlikely to agree to this.

Three cheers!

John Smith (formerly Yarra, now casual wharfie Adelaide): "It's a great decision. We all let out a cheer when we heard the news. It's big talk on the wharves. The blokes are very happy. The guys at Adelaide Brighton Cement are stoked too. It's going to make it that much harder for foreign shipping to compete."

Paul Gallagher (formerly Wallarah, now Iron Yandi): We were all really stoked to hear the news. Every one in the ship's rec room was cheering. But we also know that the fight is not really over until we get Australia seafarers back up the gangway.

"We've got to keep at them. We've got to hurt them in the pocket until Australians get their jobs back. And that is going to take time."

Nathan NidDrie (formerly Wallarah, and MUA shipping campaign committee member, Newcastle):

"We were all on the ship when the call came through from the Kembla office. It's a great decision. The feeling was that the future of Australian shipping all hung on the court outcome. Other major shipping companies have been just sitting on the fence waiting to see what happened. If CSL got away with it, they would have followed."

Dianne Kelly (formerly Yarra, now Emberley):"It's just fabulous. The best news. It means what we did in Port Pirie is not forgotten. Something is finally coming to fruition. It means these foreign companies can no longer shun Australian laws. I'm really passionate about saving Australian shipping."

Sovereign Rights

When CSL's barrister argued in the High Court that Australia did not have jurisdiction over the transportation of goods between its states and that foreign ships were a law unto themselves, the judges could barely hide their displeasure.

Justice Kirby was especially caustic: "In a world of globalisation we are going to see more of this interface between international activity and local activity and jurisdiction is not an unimportant assertion of sovereignty," he said.

"You cannot point to any principle of international law that says a sovereign state cannot regulate the relations between an owner and the crew of the ship which trades along the coast of that state," said Justice McHugh.

The Government's barrister backed the foreign shipping company by attempting to curtail its own jurisdiction.

It was in the words of Justice Gummow a "dangerous submission".

"You are inviting a whirlwind on yourself at some later date. That is all I can say about it."

But the attorney general's legal representative was unabashed.

It appears this government has become a lackey of globalisation willing to go to any length so long as it can give its business mates cheap freight rates and get rid of the MUA- even if it means undermining Australian sovereignty.