THE coal industry was accused in federal parliament yesterday of the widespread "fraud and abuse" of casual mine workers, with the agency that manages the industry's $1.8-billion long service leave scheme appearing for the first time before a Senate budget estimates committee.
One Nation Senator Malcolm Roberts - who worked in the industry and whose father served as Queensland's chief inspector of mines - peppered two representatives of the Coal Mining Industry (Long Service Funding) Corporation with 20 minutes of often hostile questions, with Pauline Hanson beside him and government representative Senator Marise Payne opposite, next to the Coal LSL executives.
"I've had a long history in the coal mining industry and I've never seen people so badly abused," Senator Roberts said while questioning Coal LSL's deputy chief executive, Suzanne Jenkins, and its general manager, legal, Peter Kembrey.
"I've been a coal mining union member and a management member and I've never seen this.
"The coal miners of NSW have a tough reputation and they deserve it.
"When this can happen to them, no worker is safe.
"Every worker should be concerned that this has happened as a result of systemic fraud and abuse by a big union, a big company and big government."
Senator Roberts said One Nation would "have more to say" about the "deceitful practices" it had uncovered but he would "constrain" himself because yesterday afternoon's hearing was about long service leave only.
Where is the union in this issue? This is precisely the reason why workers join unions and pay dues. It would seem that not only are the unions party to this arrangement but profit from its deceit.Senator Malcolm Roberts, One Nation
"You are not looking after the responsibilities of casual workers who work on a full-time roster, work shoulder to shoulder with full-time employees, with a roster [set] out two years [ahead], 40 per cent underpaid, their hours not reported correctly with LSL, and then they leave before they can get paid out their LSL."
From 1947 until the 1990s, the coal industry was regulated by the Joint Coal Board in NSW and the Queensland Coal Board in that state.
Deregulation laws enacted in 2002 paved the way for the government to privatise the coal board's powers and assets, but only to companies owned "in equal shares by the CFMEU [as it was at the time] . . . and the Minerals Council of NSW".
This created Coal Services and other industry bodies.
The Newcastle Herald has published numerous articles outlining concerns about the treatment of casual mine workers, and there is a growing belief - denied by union officials - that the CFMMEU has a major conflict of interest in its joint ownership of major industry bodies with the minerals council, which represents coal companies.
Questions are also being asked about coal companies using labour hire firms for workers, with Senator Roberts naming prominent labour supplier Chandler Macleod during the hearing. Chandler has been the subject of various Herald articles and is the target of a Federal Court class action by Canberra law firm Adero.
Despite the coal industry's deregulation, Canberra maintained a behind-the-scenes role collecting per-employee levies from coal companies that pay for a portable long service leave scheme that allows mine workers to accrue long service benefits across the industry, rather than start from scratch again each time mine lays off workers or shuts down.
It was this role that allowed One Nation to summon the Coal LSL executives to Canberra, although a letter seen by the Herald shows they resisted the call.
On October 11, Suzanne Jenkins wrote as acting CEO to the estimates committee secretary asking Coal LSL be excused because it had "not previously been required to" appear and was only given two week's notice it "would be required".
As well, its chief executive and "primary witness" was incapacitated due to recent surgery but it would be "happy to respond in writing to the questions" or "arrange a meeting at a mutually convenient time to discuss any particular queries a senator may have".
The committee declined the request.
Coal LSL's latest annual report issued last month for the year to June 30 shows it has $1.83 billion in funds under management on behalf of 118,950 employees, of whom more than 51,500 are "active employees" of the black coal industry.
Measured in hours, the levies collected by Coal LSL equate to 52 million hours of long service leave, or an average of more than 43 hours for every member.
During the hearing, Senator Roberts said he had met with eight Hunter mine workers in the past week whose long service leave details were wrong, in the employers' favour, and he believed there were "hundreds more" in the Hunter alone.
Ms Jenkins said the only formal complaint she knew of came from a Chandler Macleod employee.
Coal LSL had checked with the company, which said its records were correct.
Questioned, she said no further action was taken and it was a matter between employer and employee.
Despite the apparent lack of "complaints" from mine workers owed leave, the annual report says Coal LSL fielded 659 requests from workers to "review" the amount of long service leave they were said to be owed, an increase of 515 in 20178-18.
Although these figures are stated more than once in the annual report, it does not appear to contain any detail on the outcome of any of these reviews: whether employers were found to have under-paid or not paid the compulsory levy.
The report does say, however, that "many non-compliant employers do not know they are obliged to register and pay into the fund on behalf of their employees".
Coal LSL said it had secured "a commitment of more than $7 million" in the past financial year in "back levies from employers with unpaid obligations".
Our purpose is to connect employers and employees with long service leave for the good of Australias black coal mining industryCoal LSL annual report
The report also shows the levy paid by employers was cut last year from 2.7 per cent to 2 per cent of "eligible wages" because an actuarial assessment found the board had "a significant surplus position" of 149.1 per cent.
The report notes that Coal LSL is "economically dependent" on the money it receives each year from the Commonwealth, which collects the long service levy.
The accounts show it received $134.5 million from Canberra in the year to June 30, down from $149 million in 2017-18, with the drop likely to reflect the cut in the levy to 2 per cent.
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