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Arbitrator rules Shell must accept collective bargaining on Australian offshore facility

10 December, 2020IndustriALL Global Union affiliate the Australian Workers’ Union (AWU) successfully applied to the national industrial arbitrator to force Shell to agree to bargaining on the Prelude FLNG offshore platform. 

Under Australian labour law, if a majority of employees want to be represented by a union in collective bargaining and the union can satisfy the national industrial tribunal of this, the company must negotiate in good faith with the union. Shell had previously resisted bargaining with the AWU, saying that it did not believe a majority of employees were in favour of a formal bargaining process.

The AWU applied to the Australian national industrial arbitrator, the Fair Work Commission, asking for the opportunity to prove that employees wanted to be represented. The union collected signed petitions from employees that stated they wanted to commence bargaining for a collective agreement.

In response to Shell’s reluctance to rely on the petitions collected by the AWU, the Fair Work Commission permitted Shell to conduct a formal, anonymous ballot of Shell’s workforce on the Prelude, the world's largest floating liquefied natural gas (FLNG) platform, and the largest offshore facility ever constructed. Over 90 per cent of employees voted and approximately 80 per cent voted in favour of bargaining. After the outcome was announced, Shell agreed to initiate bargaining by 16 December.

Once bargaining has commenced, the unions will negotiate an enterprise agreement, which is a collective contract that will set the terms and conditions of employment for 219 workers, covering most Shell employees who work on the Prelude. Once the bargaining process is complete, the draft agreement will be submitted to the workers for a vote. If the vote passes, the Fair Work Commission will approve it, and it will become a legally binding industrial instrument.

The negotiations come after months of strikes by contract workers on board the Prelude, including both catering and maintenance workers concerned about working conditions, including job security concerns and rostering arrangements that could see workers spending more time at work for the same amount of pay.

IndustriALL energy director Diana Junquera Curiel said:

“Workers have a right to be represented by a union, and it’s unfortunate that the AWU had to seek arbitration to force Shell’s hand. The ballot shows that workers are overwhelmingly in favour of being represented by the union in collective negotiations.

“We trust that Shell will negotiate in good faith, and that the resulting enterprise agreement marks the beginning of better industrial relations at the company. We will be watching closely.”