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Generally industrial relations issues have not materially impacted UK project performance. Union powers are limited and there is no strike or withdrawal of labour action. Industrial action if taken does not result in stoppages or demands for payment of lost time.
Safety is not confused or contaminated with industrial relations.
BLL does not directly employ any construction workers / operatives and therefore does not have industrial relations issues involving our direct employees.
Any activity relates to our subcontractors and is usually in relation to payment of annual leave and public holiday pay. Due to the large number of foreign workers (especially from Eastern Europe) who work on piece rate rather than wages, the issue of payment of minimum conditions is often raised.
BLL is a member of the major contractors association (this has changed as the Major Contractors has been disbanded - we are part of the UK CBI Consstruction Coucil or Committee and the UKCG which is the UK nContractors Group I think chaired by Spanswick) and as such is committed to ensure minimum employment conditions are paid in accordance with an industry agreement.
In the UK North business unit, BLL employ a Convenor (similar to a union delegate, for UCAT, which is the union that covers the building trades) who helps manage issues and complaints raised by the subcontract workforce against their employers.
In the UK south business unit, convenors are not employed by BLL, but are employed by our site logistics and security sub contractors and perform a similar service.(Question did we have one of the subcontractors em[ply a convenor on the AV?)
BLL also maintains relationships through regular communication and meetings with the regional UCAT secretaries.
BLL does not have any project agreements on any of our UK sites, which would be a special industrial relations agreement.
Escalation of any significant IR issue is through the UK Head of Operations Peter Varga.
The last incidence of industrial activity on a BLL UK project was 3 years ago, with a picket on the Manchester Hospital project by two electricians, as a result of a subcontractor terminating their employment.
This issue was resolved without stoppage, lost time or commercial impact.
The major unions with coverage of the building trades are represented on the Olympic site and a senior union representative sits on the ODA board.
ODA expressed concern in late 2008 as site works commenced, that during the last year of construction (2011), as plumber and electrician numbers substantially increase, there may be an increase in industrial activity and demands for increased special site allowances.
Currently industrial relations at the AV are good. The BLL Project Delivery Director (Peter Jacobs) meets each month with full time convenors from the trade unions, UNITE and UCATT. These convenors are employed through the site logistics subcontractor.
Relationships with both the Regional secretaries and the ODA IR team are also regular and cordial.
Current assumptions are that as finishing trades (especially electricians) and Tier 1 contractors increase in the coming months then issues around payment and terms will increase and may lead to industrial unrest.
To mitigate the issues BLL have agreed to:
Adopt audits of employers and their employment and pay practices in a similar manner to that being implemented on the Olympic Park. The first audit is anticipated to be completed in Mar 10.
Recruit an IR specialist for the AV, which the ODA have agreed to fund.
Overall Risk Assessment
Unions are generally organised on a city or regional basis not nationally, hence the BLL strategies and structures for managing are decentralised.
There are only 4 cities, that BLL USA operate in, where unions have significant influence: New York, Boston, Chicago and San Francisco.
In recent memory there have been no union disputes that have significantly impacted on project performance.
IR issues occasionally arise out of jurisdictional disputes between unions competing to perform certain scopes of work.
BLL's role in these issues is to facilitate an expeditious resolution. While resolution of these disputes requires dedicated resources, staff time and occasionally paying attorney's fees to mediate, it is not a material impost.
With respect to BLL's own direct labour in these four jurisdictions, BLL have entered into one or more collective bargaining agreements (CBA's).
BLL's standard form of subcontract requires that a trade contractor be fully responsible for its labour throughout its course of performance, and that it assume all risks in connection with labour disputes involving its workforce. Subcontractors are required to employ labour that is compatible with the labour of other subcontractors; take all steps necessary to avoid labour disputes; and be responsible for any damages or delays caused by such disputes.
Using Chicago as an example,:
if issues develop with Union Labour (the predominant issue being jurisdictional disputes) , BLL work with a number of groups to mitigate problems:
On the union side, the Chicago Building Trades Council is the umbrella organization for the 26 trade locals that we typically see on our projects. BTC will talk with the unions involved in a dispute and try to negotiate a solution. They also operate a Joint Conference Board, which more formally adjudicates disputes, like the recent decision over who owns green roof installation.
On the management side, we have informal relationships with some contractor/industry associations.
Mid-American Regional Bargaining Association (MARBA). MARBA serves associations representing union contractors by negotiating and administering collective bargaining agreements, providing continuing education for contractors and promoting and maintaining labor relationships.
Builders Association (BA), who offer contractors access to resources that can help them solve problems and make better decisions about labor and other topics.
In addition, on many of our projects, we have negotiated Project Labour Agreements (PLA's) that include a pre-agreed mechanism to resolve jurisdictional disputes.
The second area of labour risk is work stoppages, due usually to union agreement renewals or grievances. These are actually very rare in Chicago, as we have had only two in the past 15 years. The PLA includes a no strike provision. PLA's are very common on public projects, and by way of example we have recently negotiated them on 5 of our private projects (Trump, 353, 155,WOTP, Winthrop.)
Escalation of any significant IR issue is through the BLL USA COO Jeff Arfsten.
Nothing of note
Labour friction around jurisdictional disputes. These are growing as the construction market experiences higher unemployment and unions fight for a smaller pool of work. The risk impact for BLL is considered minor.
Overall Risk Assessment
The Federal Labor Government is committed to ensuring that all participants in the building and construction industry comply with Australia's workplace relations laws.
As a major procurer of building and construction services, the Australian Government sets out to influence the behaviour of the industry through its procurement processes, governed by the National Code of Practice for the Construction Industry, supported by the Implementation Guidelines.
In addition to the Code and Guidelines, the building and construction industry has specific legislation, the Building and Construction Industry Improvement Act 2005 (BCII Act)
BCII Act is supported by the Australian Building and Construction Commission (ABCC). The ABCC's purpose being to reform conduct in the building and construction industry.
The Labor Government, in continuing to support the BCII Act and ABCC, both introduced by the previous Liberal Government has strained their traditional cordial relationship with the Union movement.
With a looming Federal election the Labor Government has abandoned for the time being their intent to 'water down 'the current legislation governing the building and construction industry.
Although powerful, the construction unions' behaviour has remained measured and cautious in this current election year.
Until the next round of bargaining for Enterprise Agreements, due mid 2011, the industry continues to enjoy a relatively dispute free period.
Tiered relationship with Unions (site delegates through to Aus BLL CEO)
Regional Business Units maintain union relationship and manage any resulting IR issues, assisted by
National IR Manager (Eric Hensley).
Internal BLL Legal counsel (Rashda Rana)
External Employee Relations Legal Counsel (Alice De Boos)
Enterprise agreements for BLL direct labour in place (JDA VII).
Maintain and utilise Employer Association membership ( eg MBA).
Industrial relation guidelines incorporated into the Australian policy and procedures (3.06.01 Australia Blue Book)
Ongoing and consistent national IR training.
Recent history (last 3 years) there has been negligible lost time as a result industrial action.
Recent anecdotal examples:
Wideform - A substantial formwork subcontractor employing approx 280 construction workers on three key BLL projects; 420 George, Top Ryde and Brisbane Law Courts, was placed in administration in late Dec 09. BLL led the discussions with the unions resulting in replacement employers, settlement of outstanding entitlements and minimal lost time.
Brisbane Supreme Court - The CFMEU, in cajoling support for an industry stoppage claimed that the amenities were inadequate on this project, a good reason for taking the men 'out' for the day. BLL site management, following the IR Guidelines and disputes management process, had the matter listed in the Industrial Relations Commission on the day of the stoppage and a return to work the following day. The ABCC continue to investigate the matter.
Melbourne Royal Children's Hospital (RCH) -
In August 2008, more than 200 workers walked off the RCH and other Melbourne project sites following the introduction of the 'Blue Glue' access security system. The construction unions saw this as a strategy employed by BLL denying their access to site. The dispute was heard in the AIRC with orders issued to stop industrial action. The ABCC intervened and supported BLL's application. During the dispute, damage was caused inside the site office by Union officials resulting in the police attending site.
In late December 2008, a dispute between the formwork subcontractor and the union resulted in the site gates being blockaded preventing deliveries of materials on site. The issue being caused by a subcontractor terminating their shop steward. In Late February the project was again blockaded by union cars and officials over the same dispute resulting in a number of concrete pours being cancelled. BLL, using the Federal Court found the CFMEU to be in contempt of court orders. In June 2009, the Unions were fined $75,000 and required to pay BLL legal costs of approx $120,000.
The project, since Feb 2009 has been dispute free.
Potential stoppages resulting from ongoing 'Ark Tribe Case" (court Hearing - Jun 10): Case relates to SA construction worker (not a BLL issue) being prosecuted by DPP for refusing to answer ABCC questions relating to an industrial dispute based on EHS issues. Highly publicised and emotional case for the CFMEU and any prosecution against Mr Tribe may lead to industrial action.
'Blue Glue" dispute with CFMEU (Vic): Relates to industrial action following the introduction by BLL of an integrated safety and security management system. Court ordered the industrial action to stop. Potential risk of further action being taken in Victoria or nationally.
ABCC Replaced (Dec 10): Following the Nov 07 Federal election the Labour Government have pushed for change in IR policy which may increase Union pressure on projects. One of the election promises was to amend the BCII Act. The proposed amendment Bill includes the abolition of the ABCC (Australian Building & Construction Commissioner) and replacement with the Office of the Fair Work Building Industry Inspectorate. The ABCC have been credited for significant behavioural improvements, resulting in an overall increase in harmony and productivity in the industry.BLL Strategy is to maintain good relationship with Union. No major disputes expected. Management expect the maintenance of the ABCC until a revised Bill amendment is submitted to the Senate in late 2010 following additional lobbying of Independent Senators.