MUA---Here to Stay ...Today!

The 1998 Waterfront Dispute

Paul Houlihan

Introduction

At the Society's XIX conference (31 July--2 August, 1998) the Federal Minister for Employment, Workplace Relations & Small Business, Peter Reith, gave the opening paper, and spent much of his time discussing the waterfront dispute which dominated Australian political life for many weeks following Easter (10 April, 1998). In broad terms the MUA, at the conclusion of the dispute, were able to retain, at least for the time being, their monopoly control of waterfront labour, although they made many concessions regarding the management of Patrick's operations at the Port of Melbourne.

Because the MUA had retained its monopoly, many observers believed that despite all the concessions the union had made concerning management prerogatives, its monopoly power would enable the MUA to claw back, as it had in the past, all of the concessions it had made in June 1998.

At our conference Minister Peter Reith argued, with complete conviction, that great progress had been achieved on the waterfront as a consequence of the dispute.

Another conference participant was Paul Houlihan, who, at the end of 1997, had played a key role in the formation of P&C Stevedores, (PCS) the company formed by Donald McGauchie, then President of the NFF, with the specific purpose of contesting the MUA's monopoly on the waterfront. Both Paul Houlihan and Donald McGauchie were involved on a daily basis with the unfolding events of the battle on the docks.

Paul spoke to an enthralled audience for the best part of 45 minutes and then answered questions. His general position at the time of the conference was that although some gains had been made, the overall result from the bitterly contested dispute was that the MUA, despite some concessions, had emerged victorious.

Regrettably, most (but not all) of the tape recording of his presentation on 1 August was lost. Subsequently, on 8 December, 1998, I recorded an interview with Paul during which we traversed, again, the history of those events, and what follows is an edited transcript of the two tapes. What emerges from these two tapes is an important account of what seemed, at the time, to have been in August a tactical MUA victory, but by December had turned out to be a strategic defeat of momentous proportions.

Ray Evans
President

Paul Houlihan at the Society's Conference on August 1, 1998

What is different on the waterfront today, as compared with how it used to be before Easter 1998, is that today we can see some activity there. The essence of the problem that we faced on the waterfront, for many decades, is that there is a monopoly supplier of labour, and a duopoly supply of services, and they reinforce each other. What was really new, and strange in this comfortable monopoly-duopoly situation was that Chris Corrigan broke ranks and, in fairness to Corrigan, I want to talk about his situation.

I have never had a meal with Chris. I doubt that I ever will. I could not say he is a friend of mine or I am a friend of his, or that we are close in any way. I think he is a bloke who would probably be hard to get close to. But he set out to do what people have been talking about the need to do, since I can remember people talking about the waterfront and, I believe, many years prior to that. Now, his motives may have been many and varied, I don't know. And at the end of the day, I still don't know what his motives were. I look back at his record and I see that he fought a similar fight against the stockbroking cartel in the early '80s and did good work for Australians generally in that area, and therefore I give him the benefit of the doubt.

It has to be said at this point that there was an appalling lack of support for Corrigan, from the people who should have supported him. Chris is probably a bloke who doesn't have a hell of a lot of mates. He is not a matey sort of a bloke. I think he took on a hell of a fight, with his money; a lot of his money was in there. He took on that fight and he fought a bloody good fight. Now he had some poor advice and lots of bad things happened. In particular, he ran into His Honour Mr Justice North, but apart from that he did what all of us had been sitting around for years saying "I ought to do it", or "Someone ought to do it", and Corrigan actually bloody well got on his bike and did it. I have got to say to you that he got very little credit, very little public support, in the doing of it.

Some people were sitting on their hands because of his political connections, or allegations of past political connections. In fact, a well known political personality connected with this Society said to me early on, "Look, be careful of this bloke. He is a Sydney merchant-banker who is close to Keating". Now, we know people who are Melbourne merchant-bankers who are close to Howard, and I took fairly strong exception to that advice.

One could wish that Chris Corrigan was different in all sorts of ways from the person he actually is, but he was the only bloke who was actually fighting the fight and there were very few of us up there at the barricades supporting him. Now, I think, in the end, it wouldn't have made a tinker's curse of difference except that the next time we look for some hero to fight the fight, it just becomes a bit harder. I think it is important that we should have been a lot more vocal in our support of what Corrigan was trying to do.

Putting that to one side, it is now clear that Corrigan is, beyond doubt, the winner in the dispute. Corrigan won. He has put somewhere between $50 million and $100 million on his bottom line and that's not a bad result. But I believe that that wasn't the only or even the major point of the exercise. I think he was quite genuine in his belief that if we could get in there, and create a climate which broke the hold that the union had, if we could start to do a number of these things, then he would be good enough on his feet to take advantage of the changes and breakdowns that we were causing, and that he would be able to benefit by being good enough on his feet.

I think the real credibility of the conspiracy allegation which the MUA levelled at Patrick can be judged by the concessions which the union made in the agreement which was reached. They made such major concessions which, if they were half as sure about winning the conspiracy action as they have constantly said they were; statements which convinced a lot of people on our side of the fence, including, importantly, Corrigan's banks; if they were half that sure they would not have given away anything like what they conceded, and they conceded major changes.

The union surrendered control of the roster; it surrendered control of shifts, it surrendered a whole range of things that under normal circumstances are the essence of managerial responsibilities. But normality in business life hasn't been the case down at the waterfront and particularly at Patrick. Patrick has been a badly managed company---make no bones about that---and the acid is right on them now to see whether or not they can actually deliver the quality of the agreement that they negotiated. As I say, the reason they have got the quality in the agreement is because the union shared my belief and that is that they didn't have, and don't have, a tinker's curse in hell's hope of winning the conspiracy action.

So Corrigan is one of the heroes of this adventure. Another hero is Donald McGauchie, who did a fantastic job. I have had very little to do with Donald until all this started late last year. I have had very little to do with the NFF really since I left them to set up my consultancy "First IR". But Donald impressed me enormously as a bloke of tremendous capacity. He is able to grasp the realities of what he is looking at and get it out there---he could propagate it. He could publicly put the message across and I thought he put it across very well.

As well as Chris Corrigan and Donald McGauchie, Peter Reith did a bloody terrific job. I think Reith jumped too early, too high and too excitably but apart from that he stood his ground as we lost case, after case, after case, after case, and he hung in there. I have never been a great fan of Reith's. I think he has always seen me as being in the Costello camp and he may have been a bit uncomfortable about me. But all that to one side, I have to say to you he did impress me a great deal with the steadfastness of his approach and the political courage that he showed. It is easy to criticise after the event and I think it is fair enough to say he jumped too soon and too high and all the rest of it, but he did stick to his guns, and I think he did a damn good job in all of the circumstances.

I think what we have got to look at now is what is going to happen over the next five years. Where are we going to be? Are we going to be better off or worse off? I think the impact on the union of what we did is such that if we can convert some of the possibilities around the coast into realities we are going to see, in the long run, that we were a lot more successful than it looked a couple of months ago. I wouldn't have said this a couple of months ago because I then felt that we had been skinned and gutted and that was about as far as it went. But, as you see now what people are looking at doing and trying to do, I think there is a very real reason to be mildly optimistic.

I was shied at yesterday by Reith's office. They said that some remarks of mine had clearly been taken out of context and I said what remarks are they and they said "You were quoted somewhere as saying you think we lost". I said "No, I don't think we lost. I am bloody sure we lost, we got done like dinners". They said "No, no, no, we just didn't achieve all our objectives". It sounded a bit like Billy Sneddon's famous quote "We didn't lose, we just didn't win enough seats".

I think the least you can do to your opponent is to acknowledge that they won. I don't think they won fair and square. I wouldn't go that far but I certainly think they won the battle. The essence is though to see over the next five or six years, four-five years, even three-four years, I think we have a real probability that we are going to end up at that time and review this situation and say "Hell, we didn't do too badly after all".

Paul Houlihan in an interview on 8 December 1998

Ray Evans:

When, after years, many years, people had been trying to work out a way of bringing reform to the waterfront, what made it different in 1997?

Paul Houlihan:

There were a number of factors. The biggest single factor was that in the introduction of the Workplace Relations Act in 1996 there was established a system of employing labour which was discrete from the award stream. You had the establishment of the Australian Workplace Agreements that meant that you could employ labour on the waterfront, or anywhere else for that matter, without being roped in to the existing industry standard. That meant that there then was the legal capacity to employ labour on the waterfront separate to, mind you, it had to be lined up with, but nonetheless separate to the terms and the conditions of the Stevedoring Industry Award.

Now, once we had that established, once that became law from 1 January,1997, I started to sniff around and look for opportunities to see where we could do something about it and shortly after that, in about May, I started to focus on the Port of Brisbane where they were building a new common-user berth. I thought we needed access to a common-user berth and the Brisbane berth was going to really be the only common berth in anything approaching a capital city, and we started to look to do something based on Brisbane.

Now when I say "we", I was in consultation with the National Farmers Federation because of their long term interest in this, and we actually got to the stage where we found a partner in Queensland who shipped out of northern ports in Queensland and who had boats of his own and who was very keen on the project. A large part of their business was involved in providoring for mining operations in New Guinea. As 1997 went on and the dreadful bloody El Nino drought in New Guinea took hold, the rivers ran dry, the mines closed because they couldn't get stuff out, and his business basically collapsed. So he said to us "look, it is just not a goer".

One of the things that we also decided was, okay, if we have got a common-user facility in Brisbane, what we also need to find is a facility in Melbourne, and we looked at Appleton Dock in Melbourne. Now Appleton Dock is a pretty old dock but it has got most of the facilities that you need except it hasn't got a crane.

We approached the Victorian Government on the basis that we knew that they had, I think, one or two portainer cranes around the place and we had some discussions with the Office of the Treasurer---not with the Treasurer himself---about whether or not we could do something about that.

It was at about this stage that the balloon went up about the Dubai expedition and the Dubai thing gave us a bit of a jolt, because it meant that other people were looking at precisely what we were looking at. And we thought we had the market cornered in this little activity.

James Ferguson of the NFF was approached shortly after that by Corrigan to see whether we wanted to have a talk. James actually put to him what we were looking at doing and Corrigan then said "well, would you like to take over Webb Dock?"

That, of course, was a hell of a lot better situation for us than Appleton and because of the falling over of our partner in Queensland, we had really basically withdrawn from the Port of Brisbane concept too at that stage. So all of a sudden we had dropped in our lap a major player, and a major facility, in Webb Dock.

We had nothing to do with Dubai but Corrigan was interested in protecting the blokes who went to Dubai and providing them an opportunity. We were fairly tardy about it, in fairness, in that we felt that we wanted to make it as clean an operation as we could. We wanted it to be as transparent as it could be and really we were determined that there was to be as little undercover as possible. Without transparency the sort of problems that you run into are that you have got to go and brief your police, you have got to do all those things.

As we signed up with Corrigan, i.e. with Patrick, for the lease of the equipment on Webb Dock, we got approval from the Victorian Government for the sub-lease by the Port of Melbourne for Patrick to sub-lease to us (P&C Stevedores).

PCS was formed on, I think, 6 January,1998 when we registered the company and shortly thereafter I went to New Zealand to try and recruit some crane trainers without any success. Everyone was aware of what had happened in Dubai and people were very dodgy about it.

We actually managed, through hard work, diligence and a lot of luck, to find some people in Australia who could and would do the job. So we started to get it all in place. We then had to actually achieve the take-over of Webb Dock.

The union were very well informed of what we were doing, dates and places and everything. They knew the date on which we were going to take over Webb Dock. The deal was, as far as I was concerned, that if we didn't get vacant possession, as it were, of the three portainer cranes at Webb Dock, there was no deal. I didn't want us to start off with the TV cameras watching people being dragged out of those cranes.

Interestingly, when the time came for the security people to go in and secure Webb Dock, the union had secured the amenities block and left the cranes alone. I think that result demonstrated their priorities.

The big lesson that I learned from the whole thing started to unroll at that stage. We briefed the police on Australia Day, 26 January, 1998, (it was a Monday) and our General Manager spent all day in Melbourne from Deputy Commissioner down to the local sergeant saying what we are trying to do, when we are going to try and do it, how it was going to be done---all of that. Two days later the police advised their Minister that they had no knowledge of anything that we were up to.

Evans:

Was that in writing?

Houlihan:

I don't know if it was in writing but the Minister got utterly caught out advising Cabinet that, on his best advice, the police knew nothing about what was going on and that became pretty much a hallmark of the Victoria Police position throughout the dispute.

As I said earlier, we wanted to do this as transparently as we could. We wanted to go in, in broad daylight because, again we were trying to distinguish ourselves from anything like Dubai, any sort of undercover stuff. This was all legit.

We had to bring down from Sydney two straddle carriers. Now, they are big pieces of equipment. They were transported broken down on low loaders. The police said to us that we couldn't bring them through the city of Melbourne other than between the hours of 1 am and 5 am so that meant, because we wanted to do it all at once, we had to forget about going in, in daylight, with everything in one operation because it comprised a convey of about, as I recall, 14 or 16 vehicles. We had a whole number of Abco demountable huts. We had toilets. We had training rooms, We had security set-ups. We had closed circuit television. We had a kitchen We had the lot. Plus we had our security people in buses and all the rest of it. It was quite a big convoy and we wanted to bring the straddles in at the same time.

We had decided we were going to go in on the Wednesday night/Thursday morning and we had the straddle parked just on the northern edge of Melbourne all set to go---11 pm on the night we were all set to go---by which time we had everything else aggregated together in North Melbourne at Chubbs Headquarters (the security providers)---11 pm the police say "No, you can't bring the straddles through---you're not allowed to bring them through---it would be too provocative". So we then had to proceed to go in because we had all the people assembled so we went in that morning.

I was in the convoy. When I got down there, there were about 6 members of the MUA at the gate and about that many reporters again and a police presence of one---there was one policeman there and he refused me entrance. I said to him that I actually happen to be in possession of the lease of that property to which I was a signatory---it was my property and I was entitled to quiet enjoyment of that property. He assured me that he understood and agreed with that but not tonight. I wasn't going to have the quiet enjoyment of it tonight. Anyway, we objected and we got everybody in and it was all in place.

The Victoria Police then actually took it upon themselves to meet with the Trades Hall Council the next morning and negotiate our rights for us. They still feel we don't fully appreciate their efforts on our behalf, and they are quite right, we don't appreciate them at all. The police played a constant role of spoiling as far as we were concerned in the operation and it started, as I say, by their denial of any knowledge of what we were doing to their Minister and by stuffing us around in getting into Webb Dock.

The conclusion to the story about the straddles is very interesting because a couple of days later when we applied to bring them through again at night they said "don't worry about it---bring them during the day". So they had no fundamental problem with us bringing them through and we ended up bringing them in, in daylight, because the police had no real objection to it in the final analysis. They had just mucked us around.

Now the problem with the police down there in Melbourne, particularly down there, far worse down there than in Sydney or in any of the other States, was the fact that they had adopted the attitude that their task was to maintain the peace rather than uphold the law, and what you get as a consequence is a position that whoever is perceived by the police to have the force on the ground, the police will go with them.

Now I have to say to you that we got to a very, very serious situation down there. We had a couple of thousand people blockading the main container terminal for Australia, and who had built anti-tank traps and other fortifications across the access roads to the terminal.

At that point we had to consider very seriously what our options were. Our options were essentially either to accept the position and recognise that we weren't going to achieve our goals or we had a very real alternative---a very live alternative to that suggestion---and that was we could have mobilised about 20,000 or 30,000 farmers and taken possession of our property. The consequences probably would have been civil war or possibly something akin to civil war.

We opted not to do that. I would say that the great lesson out of the waterfront dispute rather than a number of other things is the failure of the Victoria Police, and that contagion spread to the other police forces, but the principal problem was the Victoria Police and the failure of the Victorian Government to have any influence over their police. I think that is a major political problem.

The other key area of failure was the situation in the Federal Court. It is interesting---I spoke recently at a conference where a learned doctor of laws was expounding on some of the outrageous decisions that have emanated from the Federal Court in the recent past; some of which were related to our activities. This learned gentleman was saying that the Federal Court is actually making decisions that are bankrupting perfectly sound, proper and legitimate businesses and he was very critical about that.

When it came my turn to speak, I said "look I want to try and put some balance into what has just been said about the Federal Court" because I thought the learned gentleman had painted a pretty one sided picture and it needed balancing. I said "I agree with what he said that the Court is bankrupting perfectly legitimate businesses but what he hasn't said is that they are then telling them to continue trading so it is really quite balanced---it is really quite a balanced approach being taken by the Federal Court!"

We have got a major problem, particularly in Melbourne, with the Federal Court that needs to be seriously addressed. It is something that has got to be sorted out because it is a critically important jurisdiction, as we showed at Mudginberri---the capacity of the Federal Court in these things is terribly important but civil society needs a bench that upholds the law---that recognises that they are judges rather than commissioners, and who behave as judges and act in that way.

The great disasters of the dispute

I think we (we being PCS) handled the publicity and the whole media thing at our end of the business fairly well. We contracted our security to Chubb. I think Chubb did everything that was expected of them and did it very well, and they did it with a minimum of fuss---maximum of price but a minimum of fuss.

I think a large part of the loss of public support that did occur, occurred because of Patrick's use of other security forces, use of the dogs, the balaclavas, all of this stuff which simply gave, in publicity terms, an enormous free kick to the union side. While we were looking after the publicity when we were doing our training and so on at Webb Dock I think we were able to maintain a very good level of public support. I think the critical things that went wrong were:

• the police

   

• the loss of public support

   

• the Federal Court

It is very interesting from the perspective of some months later, to look back at it and realise now that Australia has really only one container port of any significance, and that is Melbourne. I know the operators in Sydney are quite happy to walk away from Botany altogether because if you have got Melbourne working properly and you have got Brisbane and/or Perth, you don't need Sydney. The transport infrastructure in Sydney is so bad getting stuff too and from the berths that it is attractive just to walk around it altogether.

What matters is Melbourne, and what is happening in Melbourne is that, two days a week, Melbourne is the best performing container port in the world. That is important. Now I understand that Patrick isn't really passing on any of those savings just yet and frankly I don't blame them. They have experienced a tad of expense over the last year and from some of the figures I have seen and even figures that the unions have quoted what they reckon it cost Patrick, I have got to say, given the level of knowledge that I have of what we cost, I think they have been very conservative. I think it cost a huge amount of money.

I think it was terribly important that someone actually did it and I think it was very unfortunate that institutions like the Business Council and a lot of the other sort at the institutional end of town simply sat on their hands.

As far as I am concerned, it is terrific to see the Lang Corporation share price---I am delighted with that. I didn't buy any shares. I should have bought them but my wife wouldn't let me. She said it was insider trading or something like that. I think it is actually a shame that Lang Corp didn't go to the market when the banks lost their nerve and what was one of the key things at the end of the operation which really brought things to a head was the banks losing their nerve.

Evans:

So the banks in effect forced Corrigan to deal.

Houlihan:

There was enormous pressure all round on Corrigan. I think the principle thing with the banks and there is no question that some of the politicians, but not Peter Reith, were getting very anxious about running into an election campaign with a conspiracy action afoot.

What needs to be understood about the conspiracy action is this. The simplest way to demonstrate the confidence that the union had in their conspiracy action is to look at the terms of the settlement they made with Patrick to end it. They conceded enormous ground. They conceded things that don't ring any bells for people in other businesses but they conceded things like:

• the control of when work is to be done;
• the control of the number of people to do work.

A whole range of very important management prerogatives were taken back from the MUA and if the union thought for one minute that they had a real live conspiracy action, that would not have happened.

I think it is a shame that Lang Corp didn't go to the public at that stage because shortly after the dispute they went out and raised $30 million without affecting the share price a cent. I think they could have gone out and raised a lot more in the heat of battle and secured the position without the banks---taking the banks out of it.

It is terribly easy to be critical of those things. Again in hindsight, I don't think I have ever seen anyone acting under so much pressure, or acting under pressure from so many different circumstances, as Corrigan in this dispute. He is a difficult bloke and an odd sort of fellow but I think Australia owes him an enormous debt for the fact that he actually did what he did, and stood his ground for as long as he did.

The reality is that the Australian waterfront is never going to be the same. The changes are happening dramatically and quite remarkably now. P & O, of course, are playing the gentleman and seeking discussions. After some four months they now have a heads of agreement, or a memorandum of understanding, which amounts to an agreement that they are going to negotiate and they are doing very well. I must say I hope that they pay an enormous commercial price in this and if Patrick keeps going the way they are going then I think P & O will pay an enormous commercial price.

Unions such as the wharfies that exact a high level of commitment from their people, carry an enormous responsibility to make sure that when they have demanded these high prices from their people, their people understand that they have been dealt with truthfully and honestly. As people realise that, with the capital equipment that is available on these modern container terminals, the doing of 25-30-35 containers an hour is achievable as a matter of normal everyday life, I think the union will have a lot of difficulty in convincing its own membership that they have been dealt with honestly by the union. I think that is a big risk to the union.

Evans:

Looking ahead and understanding that the Port of Melbourne has undergone this extraordinary transformation, which will give huge impetus to the development of this port as the major port in Australia,---will that lead to Australia becoming a one port nation?

Houlihan:

It is a very interesting question. I had to speak at a conference in Darwin the other day on northern infrastructure. We were talking about the port up there and the railway and these are the sort of consequences that flow from these sort of things. If 12 months ago you were thinking that Daiwoo was looking at building that railway line and buying the port, you would factor in at the southern end of the whole operation at Melbourne a container rate of 18 boxes an hour, and you'd say if they are doing 18 boxes an hour, what we can do up at Darwin is ABC and we save five days steaming by putting it on the rail and all the rest of it. Those figures become the basis of pretty important commercial calculations. Suddenly, if you are doing 35--45 an hour in Melbourne, the calculations have changed enormously.

There is no question that the longer Jim Donovan of the MUA in Sydney is able to prevent the productivity changes applying in Sydney as they are applying in Melbourne, the greater the likelihood is that Sydney will simply wither on the vine.

Now what is interesting in Sydney is that the same hourly box rate is being achieved at Patrick in Sydney today as was being achieved before the dispute. The fact that half the labour is gone is by the by.

Jim is a good old fashioned Stalinist and fairly fundamental and simple in many regards. I think he is a lot less reasonable than Stalin was generally but he has got this thing of 18 boxes an hour in his head and I guess it doesn't matter how many people it takes to do it, that's what they are going to do.

Of course, in Melbourne they have gone up to 35--45, again with half the number of people. What is happening is that Melbourne is just forging further and further ahead and I think there is a really good argument about Sydney just withering on the vine.

Brisbane is doing pretty well. Fremantle is doing pretty well. You see there is only a day's sailing between Sydney and Melbourne. Why muck around? I think the example I have just cited of Darwin is quite fundamental because with Melbourne working properly, it changes the bottom line across a whole raft of calculations.

Evans:

As I understand it is just not the box rate, it is the capacity to predict, to the hour, your arrival and departure times, and be absolutely confident that that schedule is going to be adhered to.

Houlihan:

Well, you see the sort of thing that is happening is that no one is yet confident that what is happening in Melbourne is going to be maintained.

I know of an incident where a shipping line said to a regular client---the client rang the shipping line and said "look, I can't get the box there until Thursday morning" and the shipping line said "that will be fine". Now because the berth worked so well, that vessel was ready to sail at 4 p.m. on the Wednesday afternoon and the shipping line held it until 7 a.m. on the Thursday morning to pick up one box.

Now that is a factor of experience. They just didn't believe it would go that fast and so what has got to be learnt is that these guys are going to be doing this consistently because the key thing that has happened, as far as this is concerned, is, and in fairness to Patrick, one of the things that a lot of us questioned all the way through the dispute was that if we won the dispute would Patrick's management be good enough to take advantage of it. Clearly what they are showing is, yes they are, and they are delivering on it. Now a lot of people have got to make adjustments to the new situation.

When you think that it used to take you, say, six shifts to work a vessel and you are suddenly doing it in three, what that means is that not just the wharfies, and the managers of those wharfies, but there are a lot of other people who have to make changes too along the way.

A lot of us who have been complaining like billy-o about the failure of the ports to perform have suddenly got to lift our own game. We have to lift our game to the rate of these blokes so it flows right through.

Evans:

Going back to the winding-up of the dispute in July and the tragic necessity of having to retrench the people that PSC took on and trained---this must have been one of the toughest things in your career.

Houlihan:

It was the worst week of my life---it was easily the worst week I have ever put in.

We recruited basically three groups of people. We recruited firstly the farm boys, secondly the military who went to Dubai and, thirdly, what the military so affectionately refer to as the riffraff.

The level of loyalty and enthusiasm that we got from those people was phenomenal. They worked under extraordinarily difficult circumstances. They were spat on, jeered, hissed and carried on at. They just kept turning up and taking it again. They were terrific people.

Now, in the end, we failed to secure from the Federal Government a share of the redundancy money that was established and yet no one did more to reform the waterfront than they did; but they were excluded from the Maritime Reform Fund for redundancy which I think is one of the great disgraces of the government. But we did secure for them a severance payment of about $15,000.

Now if they were working for Coles-Myer or TNT, in terms of the length of time they were employed, that was a very good severance pay. It didn't take account of the trauma that they went through but in comparison to what a lot of the layabouts from the waterfront received in public money---ok, money that Patrick has got to repay but public money---I think they got very badly treated.

There are actions against us by some of them. The only people who have made any sort of fuss about it have been the military people. The riffraff and the farm boys have just been terrific. We have done an awful lot of work to secure employment for them all over the place, with a lot of success.

Evans:

So their discharge papers have become a very important part of their CV?

Houlihan.

Indeed. As Chris Corrigan said during the dispute, he went down to the berth at Brisbane where he said that it was just exhilarating to be with a work-force that were wanting to work.

I know transport operators in Brisbane, (and Brisbane was the port we actually worked, we worked right through, except under court instructions otherwise) who had been working on the wharf for 40 years who said that that couple of months were just the best times of their lives because, all of a sudden, everyone was working and things were happening.

It was an awful shame but please God a lot of those people are going to find their way back into the industry and will help to improve it further.

Evans:

So, you mentioned at the beginning the crucial provision in the Workplace Relations Act which denied the roping-in clause. That gave you the break you needed. As well as that there was the unlawfulness of secondary boycotts and other actions. What was new in the Workplace Relations Act in that regard that was decisive.

Houlihan:

I think what happened was that if I look at the sort of loss to the Australian economy which occurred during this dispute and compare it to what happened when Patricks sacked 40 men at the Balmain terminal five years ago when the Australian waterfront was shut for a week, the difference was that five years ago it actually cost the Australian economy about ten times what this three months dispute really cost.

The simple reason for that is because of the existence and applicability of the second boycott legislation. There were no secondary boycotts. Because of that, P & O worked right through the dispute. Brambles worked through the dispute. Other stevedores worked through the dispute. Everything kept going except for those particular parts of Patrick where there was a primary action in place.

Under the legislation that Laurie Brereton had in place, that would not have happened. We would have had to involve the Commission in the whole dispute, in order to eventually get to the Federal Court to get the relief we sought.

We very deliberately chose right at the outset to keep the Commission as far away from all of this activity as we possibly could because of their track record in this industry of basically conceding whatever the MUA wanted.

We needed to be able to keep the Commission away from it but because of the changes to the Trade Practices legislation, getting the secondary boycotts back into the Trade Practices Act, meant that it was available without us having to bring the Commission into the whole matter, and that was fundamental; as it has been say in the Hunter No 1 dispute where a hugely important dispute in the coal industry has been fought out up there with every other mine still working. The reforms to the Trade Practices Act is fundamentally important to the reshaping of our economy.

Evans:

So those two provisions were an absolutely essential prerequisite.

Houlihan:

We wouldn't have started without both of them. We had to have both of those things on the statute book in order to give us a chance. This was always going to be a difficult brawl; but in order to have any sort of a chance we had to have the capacity to employ people without being roped back and, secondly, we had to have the capacity to use the secondary boycott legislation without bringing the Commission into our backyard to do it.

Both of those things became possible via the changes to the Workplace Relations Act which Peter Reith got through in 1996.

Evans:

Why do you think the chattering class press, which originally was sort of 50-50, turned against the reformers.

Houlihan:

I think we got a good run from the press. I think PCS got a very good run from the press while we were handling the publicity ourselves. We put a lot of effort in and I think we did it pretty well. I think when Patrick took over the operation from Easter time on, I think that the dogs and the balaclavas approach was just giving a free kick to the other side. I think we got a good deal from the press, by and large, including the ABC (other than PM).

I think PM had a barrel loaded for us all the time. I remember the breathless excitement of the lady from PM in Melbourne who found the nerve centre of the farmers' war room on the 12^th Floor of some hotel in Melbourne. We actually had an office on the 1st Floor in Collins Street but anyhow she found it up there and she was banging on the door with the microphone going---you could hear her steps coming down the corridor---she gets to the door "this is the door of the nerve centre of the war room" bang, bang, bang, and inside is one of our contractors who is staying there. He has his wife and family over from Tasmania for a couple of days and the PM lady is screaming "come out Mr Corrigan come out". "I know you are in there Mr Corrigan".

Chris Corrigan actually heard the report---he was driving around Sydney with his wife. He reached for his phone and his wife said "what are you going to do dear?" He said "I am going to ring the ABC and tell them that I have just visited every brothel in Melbourne looking for Louisa Sacatelli and I can't find her any more than she can find me on the 12th Floor of that hotel in Melbourne because I am in Sydney. His wife prevailed on him not to do that. It might have changed the whole public opinion of Chris Corrigan.

Evans:

The reason for the balaclavas is obvious?

Houlihan:

No I disagree with that. We put to Chubb that we had a few preconceptions about how all this should be handled. They said to us "look, this is actually our business and we have been doing it for a while and we know a bit about it". They said they work on a three line defence and, in a static site like this, they want about 40% of young women in the first line because the television cameras will focus on them and so will any potential violence and no one will be game to throw a punch at a woman and that stops a lot of things before it starts. We come to a second line of heavier people. And then we come to a third line of Islanders and no one goes through.

Evans:

These are Pacific Islanders?

Houlihan:

Yes. They said it is as simple as that. The only injury we sustained at Webb Dock was to one of the security girls when one of these gallant lads threw a brick through the window of the bus and she got a shard of glass in her eye. Thank God she was able to be taken to the hospital where they got it out and there was actually no long term damage at all. That was the only injury.

I accept that Corrigan had to send the blokes in to seize the berths before Easter because people were there. He had to get people off but I just think that it was done so badly and, in fairness to the other side, they capitalised on it so well.

Evans:

They did. They had posters all round Melbourne "This is John Howard's relaxed, more comfortable society".

Houlihan:

I have been picketed on a number of occasions where I have spoken where people now turn up with their balaclavas and their pet dogs and I have to say that I think it is quite clever. You see these people marching up and down outside your hotel with their balaclavas on and their silky terriers or their poodles. It is a clever touch and they did that very well.

But nonetheless I think they have lost the war. I think they won that battle but I am sure they are going to lose the war. The war would never have got under way without Corrigan and those employees having the heart to go and do the job.

Evans:

Back to the Federal Court. There is the North decision and there was the appeal to the Full Bench headed up by Murray Wilcox who had, as I recall, bagged the Opposition in the 1996 election campaign from the Bench, and nobody to my knowledge has ever remarked that this seems to be a rather unusual practice for a Federal Court judge.

Houlihan:

I think it was stupid what he did because although I don't dispute the statistics of what Wilcox said about the cases that get before the Court, the thing is that my business does as little as possible in the wrongful dismissal area because it is a bit like family law. It is the grubby end of the business. But, you know, needs be as needs must from time to time and we do it, but the simple facts are that I would estimate we urge 90% of employers who come to us with wrongful dismissal matters, to settle. We just urge them to settle, don't even try and litigate. We tell them to find out how much money it is going to cost because, as we say, it is going to cost you about $20,000 for us to run a proper case for you. If you can settle for less than that you are in front. We say this is not a business of morality. We are not talking morals here or anything. I am just talking about dollars and cents. If you can settle it for $15,000 and get it off your books, you are better off than paying us $20,000 to go and win the case for you.

So what happens is that the cases that Wilcox was commenting upon are the cases where people have decided "no I am just so sick of being set up by these rabbits that I am actually going to fight this regardless of the cost". So he is talking about 55/45 in employers favour in the 10% or less of cases that might go forward. If he didn't know that, that is a scandal and if he did know it, it is also a scandal.

As you know, the initial North judgement is carefully written. It is written in such a way that it is all about the discretion that he has. It was, after all, only an injunction. It wasn't a finding of fact in any way at all. It was simply an injunction and appealing those sort of discretionary matters, particularly in the injunction stage, I mean it is very, very unlikely that you are going to get a Full Court to overturn a single judge.

In order to gain the injunction, the Union, as you do, have to give assurance about any damage that Corrigan suffered as a result of the injunction if it wasn't finally upheld. The union had assets of $26 million. The Federal Court accepted from them sureties worth about $44 million in the granting of those injunctions in terms of the damages that PCS could suffer, that Patricks could suffer and other contractors could suffer. That was also part of the reason I was sorry that the whole conspiracy thing didn't go forward because the MUA would have been bankrupted. I think it is also very rich for the Federal Court to accept almost twice as much surety as they had in assets. I felt that that was a bit over the top.

Evans:

There is no doubt that the waterfront has changed and I think there is no going back. There is a possibility that the shape of the port industry in Australia will be significantly changed because of what may, at first, be a temporary change, but may get locked in.

Houlihan:

The other really interesting thing that I think you will see happening, and I am little bit out of touch where it is right now, but Toll Transport actually have started stevedoring out of Newcastle using Transport Workers Union labour.

One of the things that should have been done and that I wanted to do, but I was vetoed by Corrigan, was to involve the TWU at Webb Dock as basically a labour hire outfit. I wanted to negotiate an agreement with the TWU to cover our employees. I know that the TWU harbours strong desires to recover what it sees as its rightful place on the wharf which it lost back in 1969---John Moore rubbed them out and the hardheads in the TWU are anxious to regain their spot in the sunshine, and I wanted to facilitate that. I think if we had done that it would have been an entirely different situation. It could have been done and it should have been done.

Toll now own the Port of Geelong and I know the TWU are saying to Toll that they want the work at Geelong. Geelong is quite a good port---it is a good grain port, fertilizer port, oil---there are a number of other things that go through there, but that could be a very interesting area.

One of the things that we learned out of all this was that we had a Canadian girl who worked for us, who did five days training---she got her crane licence after five days and she went straight on to a crane in Port Botany and one of the problems we had was that the cranes at Webb Dock were pretty old and the controls were the reverse of what the modern cranes are so the cranes that they learned on they had to go and get into another control cab and basically reverse it. The first full shift she put in---the last couple of hours she worked she was over 25 an hour. Now we know how to train people. We know what is required to do it. We have got 350 people out there trained, and that is a factor that has never happened before. It is never going to be the same again.