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EA 97-98 FIGHT
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Final Note: Three agreements were ratified in the IRC on 21 Dec 1998 after members endorsed the agreements. The agreements give a minimum of 8% over two years.

Telstra is supposed to be an Aussie Icon. The reality is that a few of their top management are influenced by Liberal anti Australian bosses. There has been no pay rise for 17 months. Telstra is Austrlaia's most profitable company.


Now they want blood from their staff. Telstra has put greed and profits ahead of people and service. CEPU members have said "enough!" A bitter and long dispute begins.


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SHORT HISTORY

1995 AGREEMENT EXPIRED
The current Enterprise Agreement between Telstra and CEPU expired on 4th October 1997. The old agreement remains in force by operation of law.

NEW AGREEMENT NEEDED
Under the new pro employer laws, workers cannot get a pay rise ever again, unless the employer agrees. Only the lowest paid workers can escape this "rock solid guarantee" of the Liberals, and then they have many hurdles. CEPU initiated a Bargaining Period on 30th Sept 97.

NEGOTIATIONS UNDER WAY
Talks began months before the agreement expired. Then on 2nd October 1997, Telstra handed down to us the first and final offer. That offer formed the basis of further negotiations. Click here to see the First & Final Agreement.

FIRST & FINAL OFFER REJECTED
Telstra were very surprised to find that staff, almost unanimously, rejected the offer. This followed much hype from the spin doctors at Telstra. Staff were given special briefings and plenty of wonderful propaganda. However, CEPU stop work meetings on 8th October were very well attended, and many members wanted a strong and immediate industrial response. Members did resolve to withdraw goodwill - do as you are told but nothing more! No more unpaid work, no more short cuts.

1997 - NEGOTIATIONS GO NOWHERE
By taking these extremely hostile legal actions against the CEPU, Telstra is showing all employees just what their real agenda is about. Since July Telstra have been saying publicly that they want a new enterprise agreement, but they did not even produce a single draft of what they wanted until October 1997.
Despite angry and negative employee responses to its proposals expressed directly, and through the CEPU during negotiations, Telstra have failed to change their demands. Clearly, Telstra has never been genuine about wanting an agreement.

INDUSTRIAL ACTION BEGINS
CEPU members began industrial action in the Business & Government work areas in QLD, NSW and VIC. A 24 hour strike took place on Friday 19th December.

TELSTRA FAIL IN COURT
Telstra tried to stop the CEPU's planned industrial action for Friday 19th December, 1997 by seeking an order from the Federal Court. The Federal Court did not grant the application. The Court's ruling confirms the right of certain CEPU members to take protected industrial action in pursuit of claims for a new enterprise agreement. The Court also did not find any fault with the CEPU's notification of intended industrial action.

TELSTRA SUES UNION OFFICIALS
After failing in its attempt to get the Federal Court to stop the CEPU's industrial action, Telstra took steps to sue CEPU and individual officials. Clearly, Telstra is trying to intimidate CEPU and individual officials. They began legal action hoping to cost the union hundreds of thousands of dollars and threatens individual officials with personal bankruptcy. This was renewed on 21st August 98 when Freehills (advisors to Telstra and the Liberals) sought a s166A certificate, naming three officials personally. These are the start of common law actions where Telstra will seek the personal assets (their homes etc) of CEPU officials.
The first crime cited by Telstra is that the Officials were "inducing some of the said employees not to perform their contracts of employment".

MORE INDUSTRIAL ACTION
On 13th August 98 all CEPU members stopped work for 5 hours to attend meetings to hear reports and determine future action. All negotiations have led nowhere, with Telstra still wanting staff to pay for a pay rise with offsets. The meetings vote almost unanimously for strong industrial action.
On 25 Aug, members in various sections began 48 hour strike action. This set off a bit of panic in Telstra IR as a "stuff up" was clearly on the books.
Further industrial action took place at selected locations.

AGREEMENT REACHED
In October 1998, The National Executive of the CEPU accepted a draft agreement following many months of negotiation. The agreement was put to members for ratification in November 1998.

A vote will take place in December 98.

DISPUTE CONTEXT

INTERFERENCE - FLOAT BEFORE EVERYTHING
Telstra was under strict instructions to waste time and defer any sensible negations (this is not hard for Telstra) till some critical dates associated with the float had passed.

LIBERAL INTERFERENCE!
In April 1997, Telstra Board has been forced to give the Liberal Government $3,000 million (yes $3 billion) to help them help their mates. Telstra will now borrow $3,000 million to make up the difference.
Telstra's financial ratings were immediately downgraded - meaning a higher interest rate. The sale price will be lowered.
The experts justify this by claiming that "Best practice" is debt of about 30% of capital. Telstra debt will RISE to about 25%.
The fact is that Telstra WAS the world's benchmark - was best practice.

Staff will now be asked to give more, as the interest bill will increase by hundreds of millions of dollars each and every year. Profit will fall and they will trot out the another old best practice joke again - not enough profit per employee.
Staff are not our most valuable asset - they are liabilities and must be eliminated.
Now you know why John Howard is suddenly terrified by the battlers - there were not as many of them when he was elected.

MORE LIBERAL INTERFERENCE
Business Review Weekly BRW ran a story in March 1997 titled Reith's Rambos of industrial reform.
The headline states
The Industrial Relations Minister is using a new breed of human resources manager to stretch the boundaries of his Workplace Relations act and prepare the ground for a second wave of changes. It states that the Liberal Party (IR Minister Reith) has nominated Telstra's Rob Cartwright (and two others) as leaders - "the A team of industrial change in Australia".
Telstra has been chosen to lead the charge to implement the Liberal agenda.
Cartwright is the top human resources manager in Telstra. He had been rather obscure and this publicity is no doubt designed to force an improvement in his status in Telstra.
Cartwright is quoted in BRW as saying "The union leadership was very jumpy immediately they heard that I had worked for CRA" (Really?)

FURIOUS LIBERALS BAD NEWS FOR TELSTRA
Employers are not taking up the Liberal Party agenda.
They are talking to their workers and their unions.
Worse still (for the Liberals) the disputes are being settled by agreements with the Unions.
First mining giant Rio Tinto (Mark 1 - this has flared again), then the Americans at the Cairns waterfront (where Reith sought a victory over 9 full time workers) and now National Australia Bank where an EBA has been negotiated (12.8%+ over 3 years).
The Liberals want more AWAs (individual agreements).
To lower wages, they must weaken your union. Your union faces a major test. We officials face individual fines and jail for doing what we believe is a right, the right to withdraw our labour.
Telstra members are seeking a new EA. The Liberals are the employer here and the taxpayers are the owners - so it doesn't matter if the company loses money. The Liberals can afford a major dispute for political purposes. We fear that Telstra is being directed to do what the private sector has seen (to date) as futile - take on the employees!
Our industrial campaign has to be carefully managed.

LAWS FAVOUR THE BOSS
The new Workplace Relations Act favours employers. Workers in many cases are deprived of their fundamental right to strike. If they strike, no matter what the demands or provocation of the boss, they face fines and even jail. Union officials also face fines and jail for merely representing members.

FLOAT AWAY, NEW PHASE?
Now that the Telstra float is behind us, we can expect a gradual change in the Telstra position. Many have a strongly held view that we will see political interference in our dispute.
The item below about the Rio Tinto dispute will demonstrates the Government's attitude to disputes - they like them!
Everyone knows there are votes in disputes. The Government is telling employers to take on the unions and use the new Liberal laws to break the union and the officials.
The employers are telling the Government start with Government workers. Welcome back to 1960 style industrial relations.

RIO TINTO - EXPOSING THE LIBERALS
The bitter Rio Tinto dispute in NSW has moved to a new phase. Given the possibility of a national dispute, the Industrial Relations Commission ordered the strikers back to work and decided to arbitrate. The unions accepted the decision.
But the Bosses were very disappointed. They do NOT want the umpire.
They want the dispute. They appealed the decision.
They want to STOP THE UMPIRE. Worse still for the workers, the Liberal Government will support the Rio Tinto appeal to KICK OUT THE UMPIRE. (SMH 10 Nov).
They say that the umpire should keep out and let the dispute continue! Mr Reith, on hearing the IRC decision to intervene in the dispute is quoted as saying: "I thought it was a disappointing decision."

THE IR AND LEGAL TEAM TO KILL THE UNION
[Stephen Long wrote the following in the Australian Financial Review on 14th August 1998.]
A young Melbourne lawyer dines out on the story of her tenure at the employment law practice of Freehill Hollingdale & Page. A senior partner quickly bailed up the new solicitor and asked, "Will you be attending tonight's meeting of the HR Nichols Society?"
"Erhum... no,"
the freshman replied, mumbling excuses but privately horrified at the thought of joining the right-wing anti-union lobby group against arbitration.
Few people were surprised to learn that Freehill Hollingdale & Page had devised Patrick Stevedores' strategy to bust the Maritime Union - although it shocked many, including Patrick's chairman, Mr Chris Corrigan, when the legal web unravelled so spectacularly in the courts.
Freehills is the big fish of Australia's employment law practices, dwarfing rivals with almost 60 lawyers and 14 partners nationwide. It boasts a client list that reads like a who's who of the nation's blue-chip companies - Telstra....
It is widely perceived as the HR Nichols Society of employment law firms, although that is a label its partners are at pains to deny.
"We aren't there to dictate ideology and approach" says the business manager of Freehills' national employee relations group, Mr Russell Allen.
Although its client base has a range of approaches to industrial relations, there are close synergies between Freehills and the tougher employers which have fought for managerial prerogative.
Freehills appears to be the firm of choice for employers which take a hard line.
Telstra, for example, dumped Corrs Chambers Westgarth and hired Freehills when its present IR manager, Mr Rob Cartwright, took over and began pushing individual employment contracts and a tougher approach to unions.
Mr Tony Wood, a Freehills partner, is on full-time secondment to the telecommunications giant, replacing Corrs' partner and former Liberal IR minister Mr Ian Macphee.
Separate to this, a number of Freehills' alumni have become prominent in IR. The new head of the Australian Industrial Relations Commission, Mr Geoff Giudice [who was counsel for Telstra just prior to his appointment], is an ex-Freehills partner.
"Freehills are certainly the firm you go to when you don't want to compromise," says one Melbourne lawyer.
"Freehills don't mind being known as the headkickers, the lawyers who deliver for the big end of town"
says another ex-Freehills solicitor.
But that reputation took a dent during this year's docks dispute. When Patrick Stevedores dumped its unionised workforce just before midnight on April 7 by terminating contracts with subsidiary companies employing the workers, its management appeared supremely confident that the strategy would survive any legal challenge.... Freehills was named a real loser in newspaper headlines, and suffered the ignominy of having Mr Corrigan question on national television the legal advice his company had received.

HYPOCRISY

- EMBARRASSING!!!

CEO ASKS STAFF TO MAKE SACRIFICE
Telstra offers a 2% pay rise in 1997. In July 1998 they offer a 4% pay rise. But we lose more than 4% in tradeoffs! PTO1 and CO5 are senior supervisors.
To allow you some comparisons we give you (from the annual reports) Frank Blount's salary, PTO1 salary, CO5 salary and the Telstra Gross Profit history:

Year       Blount Salary  PTO1 Salary  CO5 Salary   Gross Profit
1991/92     $  450,000      $41,462      $34,840      $2,120m
1992/93     $  515,000      $41,462      $34,840      $2,356m
1993/94     $  785,000      $43,560      $36,603      $2,942m
1994/95     $1,205,000      $45,542      $38,268      $2,973m
1995/96     $  915,000      $48,081      $40,402      $3,242m
1996/97     $1,415,000      $50,761      $42,654      $3,805m
1997/98     $still secret   $50,760      $42,654      $4,468m
Increase         214%         22%          22%          111%

WHAT VALUE ARE YOU REDUNDANT
The float document has the answers (page 42). Every poor worker who loses his job will contribute $17,000 to the net PROFIT of Telstra.
See you are a valued employee - for the time being!

STAFF CUTS FOR THE FLOAT
(Float Document page 42) 6900 workers (more than 1 in 10 staff) are to be shot this year - giving management a bonus profit of $117,300,000.
It doesn't take many brains to be a profit making manager!

WHAT DOES A 1% PAY RISE COST
Again the float document has it. Every 1% pay increase costs $28m.
Thus the current EBA offer of 2% will cost Telstra $56m in profit.
(And this will be discounted by 10% as more than 10% of staff are going.) The profit this year is expected to exceed $3805m!

CEO MAKES SACRIFICE
I have just heard the CEO of AMP defend his (Board) decision to give himself about $10-12 million dollars. He didn't call his $12m a salary or a wage, he called it COMPENSATION.
And AMP is performing poorly.
CEOs don't get SALARY, they get COMPENSATION.
It makes Frank look like a poor negotiator, he doesn't appear to get any extra compensation from the float.
Alas, his compensation only just gets bigger.

TELSTRA EXECUTIVE SALARIES
Here are the salaries of the top execs in Telstra. You can put names to them. Directors: There are 11 directors on the Telstra Board. (Note there have been 6 changes to Board). Their remuneration for part time work is

   $1,415,000 (CEO) 
     $115,000
      $55,000
      $45,000 x 3
      $35,000 x 4 
      $15,000 x 5
       $5,000 x 3
Managers: The salaries of the eight top managers are:
     $765,000
     $715,000
     $685,000
     $655,000
     $625,000
     $595,000
     $555,000
     $545,000

GREAT REDUNDANCY
The Annual Report shows that two Executives received more than a million dollars last year. One was the CEO. The other received $1,145,000 last year.
A footnote states "This amount mainly relates to a redundancy".

MANAGEMENT EXPERIENCE

Manager    years in   years in   before Telstra (float documents)
           position   Telstra
D Campbell     4         8       telecommunications
R Cartwright   2         2       15y in CRA (Rio Tinto group)
G Moriaty      2         4       telecoms including TVNZ and BCL
P Rizzo        4         4       banking including CBA
P Shore        0         16      telecommunications including OTC
Z Switkowski   0         0       Optus and Kodak
G Ward         2         25      telecommunications
L Yelland      1         5       computer industry

EXPERIENCE COUNTS
The float documents tells us that the 8 most senior managers in Telstra have a wealth of experience. Get a load of this:

Total years in position for all 8 managers    14    years 
Average length of time in position             1.7  years
Total years in Telstra for all 8 managers     64    years 
Average length of time in Telstra              8    years
If we take out P Shore and G Ward
Average length of time for other 6 managers    2.9  years



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