Tug Boat Crews in Struggle with Shipping Giant

By Andrew Martin

Svitzer, the largest towage operator in Australia, has savagely attacked its maritime workforce using COVID as an opportunity to undermine hard-won wages and conditions. The company claims that the ongoing pandemic has made its business unviable, despite the fact they are owned by Maersk, the largest and wealthiest shipping company globally.

The Maritime Union of Australia (MUA) claim they have fought hard for job security, working with state governments and port authorities to ensure union agreements at every major port in the country that delivered good permanent jobs. Svitzer has been a beneficiary of the MUA’s lobbying, but it hasn’t stopped them from going to war with the union.

Whilst containerised shipping accounts for over 70% of Maersk’s business, they have extended into the operation of ports, manufacturing and inland freight transportation and have over 83,000 employees. They describe their business model as “an end to end solution”.

Maersk is in no economic trouble at all. Their suppliers are struggling to build ships fast enough, with plans to add 11 more 400m long 20 000 TEU ships by the end of this year. These ships are the size of the Empire state building. Based in Denmark, Maersk is a global giant with a capacity of 4.1 million TEU’s (20-foot equivalent unit containers), operating a fleet of over 700 vessels.

The pandemic threw shipping into chaos. Adding to the global shock wave was the spread of covid-19 throughout entire supply chains. For instance, ports in China closed for up to two months. Demand for containers dropped 15 to 20%. The initial pain of the outbreak  caused a severe economic slump – but it was short-lived. Consumer discretionary spending has grown.

Paradoxically, lock-downs in all the major rich nations of the world  led to a sharp increase in the demand for consumer commodities. A crisis in demand for containerised shipping has now become a crisis of supply leading all major shipping companies to increase the cost of freight massively.

There is not enough shipping capacity to meet global demand. In 2021 there has been a 31% increase in containerised shipping compared to the previous year. If a ship breaks down, there is no other ship to replace it. Everything is stretched to the limit. Most major ports are setting new cargo records. Containerised shipping has never been as profitable as it is now.

They are raking it in; 2021 is more than just a good year – it will set Maersk up to remain at the top of the heap for many years, if not decades. Maersk is expecting to increase its volume by 20% within a year, an unprecedented level of growth. They are also securing a record number of long-term contracts. Their entire year earnings forecast is up by 43%. Their earnings before interest and taxes are up 106% over the same period last year.

Many of Svitzer’s tugboat crews have been working for them for over thirty years, some of them starting when tugboats were still made of wood. The average time served of Svitzer’s workforce is over twenty years. Svitzer operates 104 tugboats around the country. The work is unpredictable, dangerous and demanding. Svitzer has a very flexible and reliable workforce, but the flexibility only goes one way. Workers can be rostered on at any time, and every shift is of a twelve-hour duration. Rather than getting shift loading or penalty rates, they receive an annualised rate of pay.

What started as a dispute around updating an existing enterprise agreement is now an industrial conflict where the rights of union labour are being tested. Svitzer withdrew its operations from Port of Geelong and Port Botany in Sydney. In Geelong, 17 workers were laid off four days before Christmas. Six months later, Svitzer returned to both ports using a fly-in-fly-out labour-hire company to replace the workers they’d laid off.

Jamie Newlyn, the Assistant National Secretary of the MUA, told the action that the struggle against Svitzer would be “…a global struggle…and a struggle we will win, a struggle that calls on brothers and sisters like yourselves and that it is the collective, the union movement that magnifies us 1000 fold, that makes sure we will always win”.

Christy Cain, National Secretary of the CFMMEU (to which the MUA is affiliated) also addressed the crowd at Webb Dock: “We’re not asking for a lot, it’s not a crime to fight for good jobs, but with global and national support, we will win”. Cain referenced the 1998 Patrick’s dispute in which wharfies faced a total lockout and replacement by scab labour:

“Without the ’98 dispute, there’d be no wharfies working around the country today – without the trade union movement coming behind them standing shoulder to shoulder; there’d be no wharfies working on agreements as we know it today”.

Cain spoke of the need for widespread industrial action: “Nothing in. Nothing out. We’re not going to have a twelve-hour dispute. We’re going to be here week-in, week-out, week-in, week-out, month-in, month-out until we win. We’re going to ask all 52 unions in Victoria to support us. If they’re going to meet us, they’re going to agree to a union agreement. They are going to put our crews back on the tugs in Geelong and get rid of the scabs that have undermined our wages and conditions.”

The MUA has pledged to continue industrial action targeting Maersk, ensuring all ships will miss their shipping windows – their designated operating time – at each port. Cain promised 24 hour stoppages across the country, saying Svitzer would be hit with:

“24, 24 and 24-hour stoppages targeting every port around the country from the coal terminal in Newcastle, Adelaide, Port Kembla and all around the country… They’ve attacked us, and we’re going to attack them. When workers unite and come together, we win.”

More rallies are expected.

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