South African union conference speech

Policy paper / backgrounder

Calling Rio Tinto to account:

the objectives of an international trade union network in a global economy

John Maitland

National Secretary

Presentation to the

ICEM Rio Tinto Network Meeting

Johannesburg, South Africa

7 February 1998

Special Guests, Dear Colleagues,

I am immensely pleased to be here to address unions from around the world who organise Rio Tinto operations. I especially pay tribute to the ICEM for organising this conference and to the National Union of Mineworkers of South Africa for hosting the event.

In belonging to the ICEM the CFMEU knows it is affiliated to an international union which has repeatedly proven its worth in taking on the big and the unaccountable of this world - the companies that make exploitation their operating philosophy and which wear the misery of their workers as a badge of honour. Having the NUM of South Africa as an ally in the ICEM is to take comfort from the knowledge that we are working with one of the most successful unions in the world. A union that was instrumental in the battle against apartheid.

This is important to me. From the point of view of Australian unions the battle against Rio Tinto is a battle against apartheid of another kind. It is a battle to retain our human rights - to prevent them being taken away from us and relegated to the status of second class citizens in our own country.

Because Rio Tinto is not good for everybody. Rio Tinto does create wealth. But it makes damn sure that such wealth does not flow through to the community as a whole. It does not ensure that the communities in which it is located are better off; that the wealth that can be provided by mining contributes to a better tomorrow.

The goals of Rio Tinto are much more basic and brutal. It seeks to generate wealth for senior management and for shareholders. It's senior managers are amongst the most well-paid in the world, with packages running into millions of dollars. Its shareholders are mostly financial institutions - banks and funds managers who care only about the bottom line - who measure success only by the rate of profit achieved.

Rio Tinto claims to be a model corporate citizen. It says it wants to be a good neighbour. But the bitter experience of my union is that the company is a cynical manipulator of public relations to ensure that its profit-making remains unhindered. In reality it only complies with legal minimums in most countries where it operates. And where it finds the laws unsatisfactory to its style of operation it campaigns to have the laws changed.

Which is just what it has done in Australia. Rio Tinto told the Australian Government that its industrial relations laws recognised too much of a role for trade unions, that the laws were wrong in placing emphasis on the collective resolution of disputes between business and labour. Rio Tinto doesn't want that. Having to work with laws that required it to deal with unions meant that it had less right to bend individuals to its corporate will. So it has lobbied to have the laws changed. It did more. It actually supplied staff to the Australian Government to help rewrite the industrial laws. Mike Angwin, a senior Rio Tinto manager was lent to the Government expressly for the purpose of rewriting Australian laws to make it harder for unions to represent workers.

And right now Rio Tinto is pressing for more laws to enable it to smash the CFMEU. They've found that the first set of laws only worked against weak unions. They found that strong unions such as the CFMEU continue to survive and to struggle. So they want a second round of laws to make smashing the CFMEU an easier job.

So basically Rio Tinto is a company that says it plays by the rules, but where it doesn't like the rules it gets them changed. It is the biggest private mining company in the world. When it says “jump” any nation which relies on mining jumps immediately.

We are here and certainly the CFMEU is here, because it is time to change Rio Tinto's basic operating methods. It is time that we called Rio Tinto to account.

Big business should not just be responsible to shareholders - if indeed they are even responsible to them. (It is often argued that shareholders are treated with disdain by senior management.) Companies must be accountable to the nations and the communities in which they operate. They must recognise that there are many stakeholders in an big economic undertaking. Not just shareholders, but governments, local communities, suppliers, customers. And most importantly, the workers.

It seems to be conveniently forgotten in all the talk about stakeholders that, with the possible exception of the local community, there is no bigger stakeholder in an enterprise than the workers. Shareholders almost never have all their wealth tied up in one company. Usually it is a small part of their income. Most have never seen a single part of the operations they have invested in.

But workers have invested the biggest and often only asset they have - their labour. Nobody puts more time and effort into a company than its workers. No one invests so much. Nobody has so much too lose.

But somehow modern economic thinking says that all rights should go to the shareholders. That because they have invested part of their savings they should have absolute control over the company and that the workers, who have invested the entirety of their assets in the operation, should have none.

It reminds me of description of the British legal system (one which we have inherited in Australia) in which it was said that the law treated everyone equally in that it prohibited rich and poor alike from stealing food and sleeping in the street!

Under Rio Tinto's management philosophy all rights belong to the owners of capital and workers are entitled to nothing.

“Nothing?” you might question. But surely at least wages are paid? Not necessarily. In one piece of research commissioned by the Rio Tinto company in Australia last year it was said that a big problem with the coal mining industry was that workers would not work unpaid overtime. It said that the mark of a modern competitive industry was that workers should do additional hours each week for the company for absolutely no pay whatsoever.

Once upon a time they had a different name for working without wages in fear of losing your livelihood. It was called slavery. Today they call it “world's best practice” and “being internationally competitive”!

Why unions must work together on Rio Tinto

Some unions here might think that they don't and won't have a problem with Rio Tinto. They might believe local management who say they have complete discretion over how they run the local operation, and that working with the union is producing results and will continue.

Believe me. If Rio Tinto hasn't come for you yet it is only a matter of time until they do. If you wait until they come for you before you work with other unions it will be far too late.

In Australia Rio Tinto repeatedly said that local business units were responsible for industrial relations and that there was no overriding corporate policy. Then they progressively implemented a de-unionisation policy across all their Australian operations, starting with the most poorly unionised sites first and leaving the hardest - the coal industry and the CFMEU - till last.

Globally not all Rio Tinto operations are equally affected because the union-busting approach was to some extent born in the old Australian subsidiary of Rio Tinto - CRA Ltd. It was CRA under John Ralph who developed a so-called “human resources management” policy which said that the way to maximise output from individuals was to control them utterly. And that meant doing away with anything that might protect or insulate individual workers from company management. Unions along with laws which protect workers were perceived as an impediment to absolute management control. They are therefore to be gotten rid of.

With the merger of the Australian subsidiary back into the parent company there has been an infusion of Australian senior management into the British-based parent. CRA polices on workers are now being adopted across all Rio Tinto operations.

As I said before, if Rio Tinto hasn't come for you, it is only a matter of time before they do. If you think that your operation is making a healthy profit and therefore the union is safe, think again. In Australia the CFMEU represents workers at some of the most productive coal mines in the world. Some are also immensely profitable. But there is no such thing as enough profits for Rio Tinto. Big business in general is being called on by the financial markets to achieve continuous rates of profits of at least 15% and preferably 25% per year. Even though inflation is generally low. There is no limit to greed. The executives at the top of the company get paid for generating ever more profit. They have their own shares which go up in value as more profits are made. They all intend to retire as multi-millionaires. They don't give a damn about the welfare of workers in their operations. Like the equipment at the minesite, the workers are to be squeezed for every drop of profits they can produce. And just when you think you can't be squeezed anymore, they will squeeze out that extra last drop and then throw you away. After all, there are always plenty of more workers around.

If our unions do not work together on Rio Tinto we will be played off against each other. We will be told that so-called “best practice” workers in Country X work 60 hours per week; that workers in Country Y work only for payments based on output - for no regular wages at all. We will be told that in Country Z workers produce huge amounts of coal per person. We will ever only be told part of the story and often not the truth at all.

And if we choose to compete on wages then we know there is only one final end - when we are all on the lowest wages possible in the industry. Only then will competition on labour costs no longer be possible and only then will Rio Tinto think it has to compete in other ways.

When we think about operating globally we must remember why we also operate nationally and locally. Workers get together in unions fundamentally to protect themselves. But they protect themselves by seeking to regulate the way in which they compete amongst themselves. They agree not to offer their services for less than a certain amount of money. They agree to not work certain days or insist on extra payment. They demand that payment be paid for days when the are sick and for annual holidays. If workers did not band together in unions at the local and national level to regulate they way they compete, then workers would compete for the lowest possible wage.

It is the same logic which must drive our international solidarity. Whilst it is inevitable that some workers will get paid more than others in many countries for the foreseeable future, we should campaign together to ensure we have minimum rights. The right to bargain that ensures that workers get a just share of the benefits of mining and economic development.

We must say that fundamental labour rights are not negotiable. That the right to freedom of association and to bargain collectively should not only be a right but should be actively promoted. That as a global corporate citizen Rio Tinto must respect these basic labour rights.

What we must campaign for

The theme of our campaign against Rio Tinto should be that the company must respect union and labour rights wherever it operates. If we don't win that we win nothing. To give substance and focus to our campaign and further work I will summarise some of the issues I have touched on here:

• we must seek to establish the truth - about what the company is doing and where it is doing it. The search for the truth must include not only our problems but those related to other corporate abuses - environmental mismanagement, occupational health and safety abuses, and denial of the rights of indigenous people. We must also know the truth about the company's claims regarding productivity and so-called best practice production all over the world

• we must resist de-unionisation and share campaign resources to do so

• where we are strong we must bargain for the best deal possible with the company. In doing that we must share information about what is the best that has been achieved with the company across the world

• we must work with others who also have problems with Rio Tinto. There are many local communities, aid groups and human rights groups already working on Rio Tinto. They have knowledge and resources which we need. And we have something we can give them - the solidarity of organised labour

Finally, I return to my theme that we must call Rio Tinto to account. This company - a company that has its tentacles world-wide but has its head office in the UK where it has few operations - must be made accountable to more than the financial institutions who care for nothing but absolute profits.

Ultimately we must make it clear to Rio Tinto that we will pursue it to the ends of the Earth if it continues to be an abuser of workers' rights. We must make it clear to Rio Tinto that there is nowhere on the face of the Earth - not in the developed world nor in the developing world, where it can practice its union-busting and its denial of workers' rights.

We must show Rio Tinto that there is no place on this planet for it to hide.

Thank you.