TWO class actions seeking as much as $50 million on behalf of Mount Arthur coal mine casuals are still on track despite a court ruling on Tuesday that the funder of the cases must provide security valued at $2 million to cover the potential costs of a loss.
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The Mount Arthur class action led by injured mineworker Simon Turner was announced in February 2018 and lodged months later in June 2018 as two actions being heard together.
They were among the earliest of a spate of similar cases in the mining industry and other sectors where casual work has spread.
The Turner cases against labour-hire firms TESA and Chandler Macleod are being run by Canberra law firm Adero, which has lodged a reported $325 million worth of coal industry cases alone.
Turner first went to lawyer Rory Markham in late 2017, saying it was against the Black Coal Award to employ casuals as mineworkers.
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Other class actions followed CFMMEU litigation on behalf of Queensland truck driver Paul Skene against his "casual" employer WorkPac.
The Skene case finished with the Federal Court finding that he was entitled to accrued annual leave because he worked regular and predictable rosters.
Employer organisations led by the Australian Industry Group objected, saying the decision would lead to "double-dipping" because casuals were paid loadings to cover such entitlements.
But as the Herald has reported since 2016, coal industry casuals typically earn about 40 per cent less than their permanent counterparts doing the same job.
The CFMMEU says they are still earning a lot less in situations such as BHP's new "operations services" group, which the union describes as an "in-house labour hire service", introduced in response to the backlash against the contractor arrangements.
Adero lawyer Rory Markham said yesterday's verdict in the Federal Court was not a surprise.
Justice Michael Lee's decision shows that Mount Arthur Coal (a BHP subsidiary) and Chandler Macleod had asked for security of $1 million for each case to be lodged by the litigation funder - UK-based Augusta Ventures.
Although Mt Arthur coal originally proposed . . . that an award of security should be made against Mr Turner, this relief was abandoned. That was wise.
- Justice Michael Lee in Tuesday's judgement
Although the Fair Work Act was set up to allow people to take court action without the usual obligation of having to pay the other side if they lose, Justice Lee ruled that this did not apply to litigation funders such as Augusta.
Litigation funders have traditionally made their money by taking a contracted slice - usually between 25 per cent to 40 per cent - of any monies awarded.
In May this year, Justice Lee questioned the amount that another litigation funder would receive in a separate Adero case, saying it could lead to a "situation where people are getting less than a quarter, on the analysis, of their claim".
But Markham told the Herald that the class actions took money to run and the cost and uncertainty of such proceedings put such claims beyond the reach of most individuals.
"As far as we are concerned, there has been little willingness by unions or law firms operating on a no-win, no-fee basis to take these sorts of challenges on," Markham said.
The union aspect is critical to the Simon Turner case, because Adero is expected to argue that the entire concept of a "casual" mineworker is meaningless, because the Black Coal Award that sets out employment conditions in the industry states that casual employment is only permitted in specified "staff" positions.
As enterprise agreements are not supposed to legally conflict with an award sitting "above" them, Adero is expected to argue that coal industry enterprise agreements that provide for "casual" employment are unlawful.
In the Mount Arthur cases, this includes an agreement that the union signed in 2015 covering Chandler Macleod employees across the "northern" (Hunter and Gunnedah) region.
Simon Turner said yesterday that the cross-case over costs had been "a delaying tactic" and he was glad it was resolved.
Markham said the case would return to the court on October 28, when he expected the costs security would be lodged.
"I'm hoping then that we can have the matter programmed for hearing, and that this will take place in the first half of next year," Markham said.
Yesterday's decision was being closely watched because of a likely flow-on to other Fair Work class actions.
Markham agreed with claims that it would make these cases less attractive to litigation funders, especially for smaller claims.
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Ian Kirkwood
Reporting journalist at the Newcastle Herald since 1987. Editorial writer, general reporter, industrial relations, industry and coal.
Reporting journalist at the Newcastle Herald since 1987. Editorial writer, general reporter, industrial relations, industry and coal.
