A historic deal has been reached which ends a two and a half year standoff between Australia’s largest construction union and the nation’s biggest building materials supplier, although there appears to be confusion surrounding the final amount to be paid and the parties disagree over who came out on top in the final outcome.
In its latest announcement, construction materials manufacturing giant Boral said it had reached a legally binding agreement with the Construction and General Division of the Victorian CFMEU with respect of court proceedings under which the union is alleged to have pressured building contractors working on projects in Melbourne’s booming apartment market to boycott Boral’s concrete product over its refusal to cease supplying concrete to developer Grocon during Grocon’s bitter dispute with the union.
Under the deal, the union and its organisers will not interfere with the supply of any of Boral’s products on building sites for at least three years.
The union will also issue a media release stating that construction businesses were free to choose their own suppliers and that the union would not interfere with the supply of Boral products nor take any action against contractors who used Boral products.
But there appears to be confusion over the amount of compensation that is to be paid as a result of the settlement.
A deed signed between the parties states that the union will pay Boral $4 million in damages plus costs.
In a statement, Boral said the costs would amount to between $3 million and $5 million, taking the total amount paid by the union to between $7 million and $9 million.
But the union rejects this, saying that ‘claims by Boral that this settlement will cost the union $9 million are a complete nonsense’.
There is also disagreement surrounding which party came out on top as a result of the settlement.
Boral Chief Executive Officer Mike Kane said the agreement marked a milestone in efforts to re-establish the rule of law on Melbourne construction sites, and would allow the company to service customers in an environment free from union intimidation.
“We will now be protected against illegal interference in serving our customers,” Kane said in a statement. “We have fought long and hard to get to the point where we can start to reclaim our position in the Melbourne CBD and we look forward to working with those customers that have felt unable to do so because of the ban."
However, the CFMEU disagrees, saying Boral had been ‘humiliated’, and that the $4 million damages settlement was well short of $23 million originally claimed by the company.
“This is a humiliation for Mike Kane …” the statement read.
“… Mr Kane’s ideological campaign against the union has been damaging Boral’s reputation for that entire time.”
“Shareholders will be breathing a sigh of relief now Mr Kane will be able to spend more time focusing on the financial future of Boral rather than waging ideological wars against the union movement.
“The CFMEU simply hopes that the end of these court proceedings will allow Boral to focus on safety rather than politically motivated litigation.”
Boral initiated the current action in February 2013, after the CFMEU allegedly demanded that that builders and subcontractors refrain from using Boral concrete on construction sites in Victoria and threatened to have workers refuse to perform work with concrete supplied by Boral.
That ‘black ban’ was in response to Boral refusing to accede to union demands that it cease to supply concrete to leading property developer Grocon, with whom the union was engaged in a bitter dispute.
Kane said the agreement would not impact separate action being brought against the union with regard to its tactics employed against Boral by the Australian Competition and Consumer Commission, which is set to go to trial in March next year.