Coal miner Simon Turner was recovering from a broken back when the penny dropped. He was victim of a billion-dollar wage scam pulled off by BHP and its labour hire firms. Michael West reports.

Simon Turner recalls the accident clearly. It was December 2015, 11.20 in the morning. Location: BHP’s enormous Mount Arthur coal mine in the Hunter Valley.

“The mine was shut down for dust but I was in the coal crew and a digger-driver couldn’t see me and hit me with the bucket of the excavator. I was taken by ambulance to the hospital at Muswellbrook.”

He didn’t know it then, but the coal miner had broken his back. He didn’t know either that he’d been classified as an ‘office worker’.

“A BHP employee came out to see me in hospital and said we need you to come back to meet with the superintendent. I later learned I had a broken back but they told me the scanning machine didn’t work.”

The paperwork said I worked in an office and was paid 28k a year

There’s a law against coal miners being employed as casual workers. It’s the Black Coal Award. Nonetheless, BHP and its labour hire associates, with the knowledge of the union, the CFMEU’s insurance and superannuation associates, the mining lobby groups and the NSW state government, were all participants in the rort.

Simon Turner only found out he was “illegally employed by a labour hire company” when he was convalescing with a broken back and thumbing though his employment papers.

Black Hole: CFMEU, governments, BHP, black coal giants in $2.5B worker wage swindle

“So I went to meet with the superintendent. Get this, he wasn’t there at work, he had to come into the mine site. “Listen mate, we’ve had too many LTIs (lost time injury), he told me. “Don’t report it, and if you do report it you won’t have a job. Just come into work and make sure you get paid. You won’t have to do anything. Just sit here.”

Turner later found out his employment had been classified as an office worker. He and other coal miners started a class action but that fell apart and Turner has been negotiating with BHP and the Minerals Council for compensation and justice for underpaid coal workers since.

“[The contracts] were all done illegally. “I was living below the poverty line for over six years … my full pay under the Award should be $137k a year. I was being paid $400 a week!”.

“The drivers of the underpayment are the big mining companies

“The drivers of the underpayment are the big mining companies,” another miner told MWM. “They (BHP, Glencore, Peabody and others) write a contract so the supply of casual labour cannot be met by using the minimum standard which is set out in the industry award.”

Says Turner: “They (BHP) are complaining about not paying people what they are legally entitled to … at the end of the day they construct the contract with the labour hire company which makes it impossible for the statutory legal minimum to be paid”.

Underpayment of workers that is, by express design of the mine operators. In this case BHP.

CFMEU a good distraction for BHP

The scandal engulfing the CFMEU has been a convenient distraction for BHP and the other mine operators. While the media has revelled in the salacious detail and mostly focused on union corruption in isolation – that is, ignoring corporate involvement – BHP and its proxies have confronted the government over its Same Job Same Pay laws.

Roberts has also fingered the labour hire operators and the Fair Work Commission – as well as the unions and BHP, saying the FWC had not followed its own Act, specifically by its failure to comply with s134 of Fair Work Act which says FWC must ensure that the Awards remain the minimum standard.

The unions, says Simon Turner, have endorsed the Enterprise Agreements struck between the workers and the labour hire companies which have allowed BHP to operate with cheap casual labour.

The Mining and Energy Union – the MEU of the CFMEU – which has split from the Construction and Forestry division, denies it endorses the underpayments; rather that these are deals struck separately over which the union has no control.

“The Black Coal Award does not provide for casual employment,” the MEU told MWM. “However Enterprise Agreements in the coal industry do provide for casual employment and there is nothing that the MEU can do about that if workers vote them up and the Fair Work Commission approves them.

“The ‘protected rate of pay’ … is a result of Same Job Same Pay laws fought for by our Union to close the legal loophole used by big mining companies to drive down wages. All applications for ‘Same Job Same Pay’ to lift rates for labour hire workers in our industry have been made by the MEU.”

Coal to Newcastle

Simon Turner had two surgeries on his back before Christmas in 2015. “I then find out that BHP had sacked me two days after I was injured. It’s in writing that I was terminated, and that the insurer paid me directly. I got the Separation Certificate. But guess what – they put on there ‘resignation’.

“And (in the box at 3) to say a workers compensation claim been made, or would be made in the future, they ticked no.”

He found that workers comp provided for 78 weeks pay and that the legislated monopoly insurer was Coal Mines Insurance, owned by 50-50 by the NSW Minerals council and the CFMEU.

“After that I didn’t get paid, Chandler Macleod said the matter was with the insurer. But I then found out it was with CGU, which is the NSW statutory scheme. The scheme for average weekly earners is PIAWE (Pre Injury Average Weekly Earnings) but this scheme doesn’t apply to coal miners.

“After a fight with them I got to view the Certificate of Currency for the policy (insurance policy with CGU) which insured me – it now involved the NSW government. On that policy, they had me down as an office worker, and I only earned 28k a year.

“I started making complaints. It went to the NSW Government. They covered it all up and paid me a PIAWE. They dropped it to $400 a week on workers comp. NSW Workcover.

“CGU could not insure me. Chandler Macleod couldn’t pay me – I was told *because* they sacked me and didn’t tell me. I was being paid directly from the insurer. Not the monopoly insurer but by Chandler Macleod via enterprise agreement which was paying everybody illegally. It didn’t just happen to me. It happened to plenty of people.” 

When the pay rate is illegal so is everything which derives from it

We now know, says Turner, that the mine owner BHP (and this applies to the other multinational mine operators Peabody and Glencore and Anglo) and the labour hire companies had a contract which was less than the award so it made it impossible for the labour hire company to pay the award.

“When the pay rate is illegal so is everything which derives from it: tax, super weekly entitlements, workers comp.

Says another former coal miner: “That’s tens of thousands of illegally employed mine workers currently and historically employed under enterprise agreements approved by the Fair Work Commission that have erroneously allowed the removal of their minimum protection. They were paid 40% of the Award”.

The MEU does not hold out hope for compensation for BHP’s salary arbitrage: “We don’t believe there is currently a legal avenue for casual coal miners to receive entitlements backpay (as it was overturned by the previous Parliament by the Morrison Government and One Nation) however we are optimistic about Same Job Same Pay laws significantly improving pay rates for labour hire workers going forward”.

This post was originally published on Michael West.