Australian Tugboat Crewing Dispute Escalates

Australian towage operators threatened by foreign competition were at standstill with the Maritime Union of Australia (MUA) last Tuesday as a dispute over tug boat manning levels escalated. "Increasingly we are seeing overseas towage companies tendering for towage contracts in our ports," said Adsteam Marine Ltd. CEO Clay Frederick, noting that comparable offshore ports operated with mostly three man crews. "I don't think our customers are going to cop the fact that we are there with four men, when clearly it has been proven it can be done with three," he said. Adsteam plans to reduce manning levels in a bid to carve A$5 million annually out of its cost base. The crew culling scheme earned the ire of MUA national secretary John Coombes, who described Adsteam's plans for redundancies an act of discrimination that escalated the dispute. "We've had three unions involved in enterprise negotiations, but Adsteam only singled out our union for cutbacks," Coombes said, noting that the union planned to oppose the cutbacks by all means possible. "We are not going to stand by and allow MUA members to be the ones who have to bear the full burden of cost reductions. It has to be across the board," he said. Wharf activity was brought to a standstill in 1998 during a protracted dispute between the MUA and stevedore group Patrick, a unit of Lang Corp. Ltd. which was undertaking a major restructuring of its work force. Frederick declined to detail what sort of charge the restructuring would raise in Adsteam's accounts, although he acknowledged redundancy packages in the industry were generous. "We are not factoring in that cost as far as recovering it by delaying benefits to customers or putting prices up. As soon as the redundancy program is completed, we will be rolling out price reductions," he said. Adsteam plans to implement the cutbacks through an offer of voluntary redundancy to all general purpose hands with the offer remaining open until February 18. Failing that redundancies would be made on a last on, first off basis. Howard Smith Ltd., for whom Adsteam manages some joint venture towage companies, echoed Adsteam's calls to combat the threat from foreign-owned operators. "We know what shipping companies pay ... so it's important for international competitiveness or we will have international competitors here taking our business," said Howard Smith managing director Ken Moss.