Ai Group calls for maritime & ports IR reforms to boost recovery and ease supply chain pressures

"Today, the Australian Industry Group released its submission to the Productivity Commission's inquiry into Australia's Maritime Logistics System. The submission puts forward a comprehensive reform plan, including industry-specific industrial relations reforms. Businesses in all industries and the whole community would benefit from addressing the industrial relations problems that are impeding the performance of the Nation's ports," Innes Willox, Chief Executive of the national employer association Ai Group, said.

"As an island nation Australia's economy heavily relies on its maritime ports. Any issue at the ports can significantly impact countrywide supply chains and business activity. As shown by the ACCC's most recent annual Container Stevedores Monitoring Report, problems with Australia's maritime logistics system have continued to worsen and there are acute supply chain pressures caused by the COVID-19 pandemic.

"Given how closely Australia's economy relies on maritime ports, these issues require urgent and swift action to ensure that our supply chains can function productively, competitively and resiliently, now and into the future.

"With regard to industrial relations matters, Ai Group's submission argues that:

• Amendments should be made to the Competition and Consumer Act 2010 and the Fair Work Act 2009 to re-draw the boundary between competition laws and workplace laws, to prevent enterprise agreements from containing provisions which restrict or hinder the acquisition or supply of goods or services by a business.
• An effective way of addressing the extreme restrictions in waterfront enterprise agreements that drive up costs for the whole community, would be through a Ports and Shipping Industry Code (PSI Code) which addresses enterprise agreement content. The Code could be created through amendments to the Fair Work Act. Civil penalties would be included in the Act for non-compliance with the Code and non-compliant agreements would be unable to be approved by the Fair Work Commission (FWC).
• The restrictive work practices that exist on the waterfront are due in large part to the activities of the Maritime Division of the CFMMEU (MUA). The Productivity Commission should recommend industry-specific reforms aimed at safeguarding the Australian community from the unreasonable union conduct that the MUA frequently engages in.
• The Stevedoring Industry Award 2020 is in urgent need of modernisation to align with the manner in which ports need to operate. The Productivity Commission should recommend that the Federal Government make a formal request to the FWC that the Commission undertake a review of the Stevedoring Industry Award to modernise its provisions. There would be merit in the Government being an active participant in that review. The review should consider the interests of users of ports, and not just the interests of stevedoring companies and their employees.

“The ACCC's Container Stevedores Monitoring Report identifies the extremely restrictive provisions in the enterprise agreements that apply to the Stevedoring companies in areas including:

• The recruitment of new employees;
• The order in which employees must be engaged to work on particular shifts;
• The allocation of work to employees; 
• The outsourcing of labour; and
• The efficient utilisation of equipment.

"The ACCC's report states that:

"...many current stevedores’ Enterprise Agreements contain restrictive provisions which reduce flexibility of labour supply and allocation, retard automation and other technological advances, reduce timeliness and reliability, constrain workplace performance, and increase labour costs for a given level of activity”.

"The report also states that the enterprise agreement restrictions have 'contributed to the sub-optimal performance of the nation's major ports and added to the pandemic-induced supply constraints'.

"The inquiry is considering the structural issues affecting the productivity of Australia's maritime logistics industry, including industrial relations, infrastructure constraints and technology uptake. The Commission is scheduled to provide its final report to the Government by the end of August 2022," said Mr Willox.

Ai Group's submission to the inquiry

Media enquiries

Tony Melville – 0419 190 347