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Dr Edward N. Eadie[2]
This article deals with Australian industrial legislation and maritime awards, international conventions, and activities of the International Transport Workers’ Federation, and is concerned particularly with an examination of the significance of these in relation to the employment of foreign seafarers on Australian controlled ships.
Prior to the Industrial Relations Act 1988, the Australian Conciliation and Arbitration Commission established under the Conciliation and Arbitration Act 1904 played an important role involving conciliation and, if necessary, arbitration in the making of legally binding awards covering rates of pay and conditions of employment in the maritime industry as described in Australian National Maritime Association (1989, pp. 89-90). The Conciliation and Arbitration Act 1904 was characterised by the power and authority bestowed on organisations registered under the Act, and both the well-established maritime unions and the Commonwealth Steamship Owners’ Association formed in 1905 became registered organisations in order to represent their members before the Commission under the newly created system. The terms and conditions of employment in the maritime and related industries that ensued comprised a combination of decisions made by the Conciliation and Arbitration Commission including introduction of the eight hour day and thirty five hour week, and the endorsement by the Commission of negotiated agreements made between employer and employee organisations. However, the latter frequently reflected the industrial power exercised by the Federally registered unions, and subsequent endorsement by the Commission to avert further industrial trouble in the maritime and stevedoring industries (Australian National Maritime Association 1989, p. 90).
The Australian Conciliation and Arbitration Commission was given specific powers in relation to industrial matters in the maritime industries in Part 111, Division 2, Sections 71-75 of the Conciliation and Arbitration Act 1904. Under s. 72 the Commission was empowered:
(a) to prevent or settle industrial disputes by conciliation or arbitration, and
(b) to settle by conciliation, or to hear and determine, industrial matters relating to trade and commerce with other countries or among the States, between a State and a Territory, or in a Territory, whether or not an industrial dispute existed in relation to those matters.
The application of s. 72 of the Conciliation and Arbitration Act 1904 was challenged in the High Court of Australia (Eastern and Australian Steamship Co Limited 1959, pp. 256-259) in a case involving a log of claims served on a company whose ships were registered in London, traded between South Australia and Japan, and had articles opened and signed in Hong Kong, but regularly engaged masters, deck officers and engineers in Australia. Demands in the log of claims sought to cover working conditions of these officers at sea or in port, and each of the officers was a member of an applicant organisation before the Commission. In the decision of the High Court it was held that s. 72(a) validly applied to the dispute, thus enabling the Commission to deal with it, and that an ‘industrial dispute’ in s. 72(a) was not limited to industrial services to be performed within Australia. It was also held that s. 72(b) was valid, and empowered the Commission to deal with the dispute. The case did not involve foreign seafarers employed on Australian controlled ships, but rather Australian seafarers engaged on a foreign ship trading between Australia and overseas. However, the case does indicate the far reaching jurisdiction of the Commission in dealing with industrial matters involving seafarers, who were members of an applicant organisation.
The Industrial Relations Act 1988 completely replaced the Conciliation and Arbitration Act 1904, and established the Australian Industrial Relations Commission (Australian National Maritime Association 1989, pp. 90-91). However, awards made by the Conciliation and Arbitration Commission remained in force, and organisations registered under the previous Act were deemed to be registered under the new Act. The specific powers of the former Commission in relation to maritime matters were abolished, but became absorbed into the general jurisdiction of the new Commission, and the provisions relating to industrial action under the new Act remained essentially similar to those under the former Act as described in Australian National Maritime Association (1989, p. 91).
The principal object of the Industrial Relations Act 1988 as stated in s. 3 is to provide a framework for the prevention and settlement of industrial disputes which promotes the economic prosperity and welfare of the people of Australia. This is to be achieved by means outlined in the section, and these include enabling the Industrial Relations Commission to prevent and settle industrial disputes by conciliation where possible and by arbitration where necessary as set out in s. 3(d). Indeed, this role of the Commission is reiterated in s. 89(a) which specifies the general functions of the Commission in relation to dispute prevention and settlement, and this is essentially similar to s. 72 of the Conciliation and Arbitration Act 1904 discussed earlier. However, under s. 90 of the Industrial Relations Act 1988 the Commission is required to take the public interest into account in the performance of its functions, and for that purpose it is to have regard to the state of the national economy, and in particular the likely effects of an award or order on the level of employment and on inflation. Further, under s. 9OAA(2)(b) the Commission must have proper regard not only to the interests of the parties immediately concerned, but also to the Australian community as a whole. These newly introduced criteria to be taken into account by the Industrial Relations Commission in the performance of its functions might have some bearing in relation to any new award that recognises the employment of foreign seafarers on certain Australian controlled ships.
It is seen in s. 149(1) of the Industrial Relations Act 1988 that, in general, an award determining an industrial dispute is binding on all parties to the industrial dispute, and on all members of organisations bound by the award. Further, it is seen in s. 149(2) that an award constituted by a certified agreement, or otherwise made by consent of the parties to an industrial dispute, is binding on each of the parties to the agreement, and on all members of an organisation that is a party. These provisions would have serious implications for the employment of foreign seafarers on Australian-controlled ships if these seafarers were to become members of Australian unions, and an acceptable way around this will need to be found as has been done by other countries employing foreign seafarers. This could be achieved, for instance, if foreign seafarers employed on Australian ships trading internationally were members of a union in their own country, and they were employed with the concurrence of Australian unions as discussed later in connection with the situation that exists already in the case of certain other countries.
The provisions of the Industrial Relations Act 1988 in relation to secondary boycotts were changed substantially by the Industrial Relations Reform Act 1993. The new provisions are contained in ss. 156-162Q of Part VI, Division 7, of the Industrial Relations Act 1988, and in particular the ingredients of conduct constituting a boycott or boycotting agreement are specified in s. 162 and s. 163 respectively.
Mention should be made here that interested parties concerned about the effects of industrial action on the cost and reliability of Australian shipping services have at times advocated the use of s. 45D of the Trade Practices Act 1974 and s. 30K of the Crimes Act 1914 as means of protecting their interests in the face of boycott activities. Action under s. 45D of the Trade Practices Act 1974 provides a civil remedy by way of injunction or damages, whereas a prosecution under s. 30K of the Crimes Act 1914 involves criminal sanction. The scope for using such legal remedies was outlined, for instance, by Trebeck (1991, pp. l-4) in the context of possible union bans on foreign ships supported by tug crews or stevedoring employees related to enforcement of the ‘Trans-Tasman Union Agreement’ known as the trans-Tasman ‘Accord’ that amounted, in essence, to a restrictive union agreement with no proper basis in law aimed at reserving trans-Tasman trade for Australian and New Zealand manned vessels, subject to consideration by the unions of alternative arrangements when specialised Australian or New Zealand ships were unavailable. However, in the case of trans-Tasman trade it is interesting to observe (Morris 1993, p. 71) that lower freight rates were achieved by managed reform without deregulation of the market structure.
It should be noted that application of the Trade Practices Act 1974 and the Crimes Act 1914 in relation to boycotts is qualified by the secondary boycott provisions in the Industrial Relations Act 1988. Section 45D(1) of the Trade Practices Act 1974 specifies, basically, that a person (that includes a corporation) must not, in concert with a second person, engage in conduct that hinders or prevents the supply or acquisition of goods or services by a third person to or from a fourth person in circumstances where the conduct is intended to and would have or be likely to have the effect of substantially reducing competition in any market in which the fourth person acquires or supplies goods or services. However, in s. 45D(2) of the Trade Practices Act 1974 it is provided that boycott conduct within the meaning of Division 7 of Part VI of the Industrial Relations Act 1988 is to be disregarded in determining whether there has been a contravention of s. 45D(1). Under s. 30K(d) and (e) of the Crimes Act 1914 a person commits an offence when, without reasonable cause or excuse, by means of boycott or threat of boycott that person obstructs or hinders the transport of goods or passengers in trade or commerce with other countries or among the States, or that person compels or induces another person employed in or in connection with such transport to surrender or depart from that employment. However, in s. 163F of the Industrial Relations Act 1988 it is provided that criminal proceedings shall not lie against a person merely because the person has engaged in boycott conduct defined in that Act.
It is hoped any disagreement regarding the employment of foreign seafarers on Australian controlled ships can be solved without the threat or use of boycotts resulting in the need for recourse through the courts, but rather that a means acceptable to all parties can be found to enable a viable expansion of the Australian controlled shipping fleet and the carriage of a substantially greater share of Australia’s international trade in such ships. Reference is made, however, to an interview (Anderson 1995, p. 21) with Dr Ken Moss, Managing Director of Howard Smith Limited, following a decision by that company to wind down its shipping activities. Continuing industrial disputes were given as one of the reasons for the decision, and Dr Moss is reported to have said that the company’s hand was forced by strikes, frequently over matters not related to Howard Smith’s business, and cited French nuclear testing, the sale of ANL, privatisation of Melbourne ports, the West Australian blockade, the trans-Tasman, and CRA, none of which directly related to their employees.
Currently, the predominant maritime award covering seafarers in the maritime industry is the Maritime Industry Modern Ships Award 1989 approved by Commissioner Fogarty in the Australian Industrial Relations Commission in February 1990 as a Consent Award in accordance with the provisions of the Industrial Relations Act 1988 between the maritime unions and shipping industry employers (Australian Industrial Relations Commission 1990). The new award was made following the ‘Moving Ahead’ report in October 1986 of the Maritime Industry Development Committee (MIDC) which was established earlier that year to develop manpower policies associated with the introduction of high technology ships into the Australian fleet (Australian Shipowners Association 1994, p. l), and the report to the Minister for Transport and Communications in April 1989 by the Shipping Reform Task Force (SRTF) (Shipping Reform Task Force 1989). The recommendations of the MIDC and SRTF reports form part of the preamble to the Maritime Industry Modern Ships Award 1989, and where relevant the terms of the award agreement were based on these recommendations as recorded in recital Q to the award (Australian Industrial Relations Commission 1990, pp. 2-5). The award reflected changed work practices on Australian ships, and provided for regulation of the terms and conditions of employment for members of maritime unions working on modern ships with reduced manning levels of 21 (or less) for dry bulk carriers and overseas tankers and 23 (or less) for coastal tankers (Australian Shipowners Association 1994, pp. l & 7). The Maritime Industry Seagoing Award 1983 (Australian Conciliation and Arbitration Commission 1983) continued to apply to existing ships that remained outside the reform process, although its residual coverage has been reduced as such ships disappeared from the fleet.
The Maritime Industry Modern Ships Award 1989 applies to the Australian maritime unions representing seagoing employees in the industry and to their members employed by employer respondents to the award, and currently these comprise the Australian Maritime Officers Union which represents deck officers, the Australian Institute of Marine and Power Engineers which represents engineer officers, and the Maritime Union of Australia which represents ratings. The award applies also to the employer respondents to the award, and currently these include the Australian Shipowners Association and its members which comprise the major Australian shipowners. Provision 3.1 of the award specifies that it applies in modern ships with reduced manning that trade as cargo or passenger vessels, and are operated in accordance with the MIDC recommendations or recommendations of the modernisation committee of the shipping industry reform authority. Further, the award applies in modern ships which the employer and maritime unions have agreed are covered by the award.
The agreement contained in the Maritime Industry Modern Ships Award 1989 provides in detail for the regulation of the terms and conditions of employment of members of the maritime unions employed in modern ships covered by the award. The provisions of the award embrace a diverse range of matters. These include remuneration (provision 5), casual work (provision 9), vessels wrecked or stranded (provision 12), time and method of payment (provision 15), hours and duties (provision 18), avoidance of physical exhaustion (provision 19), performance of work (provision 21), meal times (provision 25), leave (provision 26), travelling (provision 30), transfer of employees (provision 33), termination by the employer (provision 34), wrongful discharge (provision 37), articles of agreement (provision 39), medical examination (provision 40), industrial clothing (provision 49), and settlement of disputes (provision 56). Any foreign seafarer, who is a member of an Australian maritime union and is employed by a respondent employer on a ship to which the award applies, would be covered by the provisions of the award.
Provision 57 of the Maritime Industry Modern Ships Award 1989 stipulates that the provisions of Schedule X of the Maritime Industry Seagoing Award 1983 shall apply to the engagement of ratings employed on vessels covered by the award (Australian Industrial Relations Commission 1990, p. 39 and Australian Conciliation and Arbitration Commission 1983, pp. 88-101). Schedule X of the Maritime Industry Seagoing Award 1983 is known as the Marine Cooks, Marine Stewards, and Seamen’s Engagement System Schedule, and regulates the industry based system of engagement used for the employment of ratings on Australian ships. Further consideration of this engagement system is given later.
The Maritime Industry Modern Ships Award 1989 was agreed in order to take account of changed circumstances in the Australian shipping industry. These included the introduction of modern ships and changed work practices, voluntary retirements, and the retraining of ratings to enhance skills and versatility. At that time the employment of foreign seafarers on Australian ships in the international trades was not contemplated, and the reform process was directed towards reducing the level of Australian shipping costs to that of OECD flagged ships with national crews (Shipping Industry Reform Authority 1994, p. 4). However, in recent years most OECD countries have found it necessary to employ foreign seafarers in order to remain competitive in the international trades, and it is no longer sufficient to regard the level of costs for OECD ships employing national crews as the benchmark for reform. Just as a new award was negotiated in 1989 to take account of changed circumstances in the Australian shipping industry, it is appropriate in the interests of the future of Australian international shipping that proper and realistic consideration now be given to allowing the employment of foreign seafarers on Australian controlled ships in the international trades.
The payment of Australian wage rates to seamen employed on licensed ships engaged in the coasting trade as provided for in s. 289(1) of Part VI of the Navigation Act 1912 refers to wage rates specified in the relevant award of the Australian Industrial Relations Commission made under the Industrial Relations Act 1988. Further, any foreign workers employed domestically within Australia are entitled to award wages (Industries Assistance Commission 1989, p. 38). However, the operation of Australian ships in the international trades is very different to the domestic transport task and domestic employment generally, and such ships are subject to intense competition in the international market place from ships of other countries employing foreign seafarers.
It has been shown by Apelbaum Consulting Group (1994, p. 3) that the manning costs for Australian international vessels were substantially higher than those for similar vessels from other countries with which we compete in the international trades, and that the proportion of total manning costs expended on ratings was much higher for Australian vessels than for those of our international competitors. Indeed, both total manning costs and the proportion of manning costs attributable to ratings was higher for Australian international vessels than for similar vessels operated by each of the other countries considered, namely Germany, Japan, Liberia, Norway, Singapore, United Kingdom, and New Zealand. Further, the higher manning costs for Australian ships comprised the major source of Australian flag cost disadvantage as stated by Apelbaum (1994, p. 123). Moreover, the lack of competitiveness of Australian shipping in the international trades is evidenced by the fact that only around 8% of Australian exports and 9% of Australian imports were carried by Australian flagged ships (Paddon 1994, p. 46), and that only about 4% of our external trade was transported by Australian shipping (Payne 1991, p. 9). It is assumed the former percentages refer to the value of trade and the latter percentage to the tonnage of trade, and that the difference in these percentages does not reflect a rapid increase in the share of Australia’s international trade carried on Australian ships. In each case the percentage is low, and this demonstrates the difficulty experienced by Australian shipping in trying to compete adequately in the international trades.
Possibly, a new Part could be introduced to the Navigation Act 1912 to cover Australian controlled ships engaged in the international trades, just as Part VI of the Act makes special provisions for the coasting trade. In any event a new or varied award needs to be negotiated between shipowners and unions, as was done successfully in the Maritime Industry Modern Ships Award 1989 in response to changed conditions, in order to take account of the different circumstances that apply in the international trades, and enable the employment of foreign ratings on Australian controlled ships engaged in such trades as happens already in the case of ships operated by most of Australia’s competitors in these trades. This would provide the means of reducing or eliminating the competitive gap, making Australian shipping more competitive in the international trades, facilitating an expansion in the Australian shipping fleet, and enabling a greater proportion of Australia’s international trade to be carried on Australian controlled ships.
The system of engaging ratings in the Australian shipping industry is governed by Schedule X of the Maritime Industry Seagoing Award 1983 (Australian Conciliation and Arbitration Commission 1983, pp. 88-101), and this has been retained in the Maritime Industry Modern Ships Award 1989 by provision 57 of that award (Australian Industrial Relations Commission 1990, p. 39). Schedule X provides for the employment of ratings on Australian ships on an industry basis as distinct from a company or enterprise basis, and all employer respondents to the above awards are parties to Schedule X. All ratings that comprise marine cooks, marine stewards, and seamen are allocated to Australian ships as they are required from a pool of registered seafarers, and the system is administered on the basis of full cost recovery (amounting to around $1.2 - $1.4 million a year) by the Marine Crews Services business unit of the Australian Maritime Safety Authority (Australian Shipowners Association 1994, p. 7 and Australian Maritime Safety Authority 1994, pp. 68-69).
Retention of the current engagement system for Australian ratings is strongly supported by the Maritime Union of Australia (MUA), but the alternative of company employment is preferred by shipowners. The system of engaging ratings is a contentious and sensitive issue as discussed in detail in Shipping Industry Reform Authority (1994, pp. 4-9), and the issue remains under consideration by the MUA and shipowners. In the report of the Shipping Industry Reform Authority disappointment was expressed regarding progress made on the matter of company employment, but the parties were urged to work together and build on their statements of intent with the view to getting specific agreements.
Clearly, the tightly-controlled industry based engagement system for ratings provided for in Schedule X is not compatible with the engagement of foreign-based ratings on Australian controlled ships. The increasing employment by other countries of foreign ratings from developing countries on ships engaged in the international trades is possibly one reason (Shipping Industry Reform Authority 1994, p. 5) why the MUA perceives a vulnerability in abandoning the engagement system. However, there has been long-standing union opposition to replacing the engagement system for ratings by company employment even though deck and engineer officers on Australian ships were and are employed on a company basis. In Shipping Reform Task Force (1989, Foreword, p. iii) the Chairman, Ivan Deveson, stated his belief that the subject of the engagement system for ratings, in contrast to the company employment of officers, should be left on the long term agenda, even though he did not favour a change in the system during the period of significant rationalisation in the industry, and in Australian National Maritime Association (1989, p. 133) it is recorded that the Government supported keeping the method of employing ratings on the longer term reform agenda. Furthermore, in s. 3(a) of the Industrial Relations Act 1988 emphasis is placed on ‘the workplace or enterprise level’ for the making of agreements between the parties involved in industrial relations in matters pertaining to the employer and employee relationship, and the role of the Act in encouraging and facilitating the making of such agreements at that level is stated as a means of achieving the principal object of the Act, namely the provision of a framework for the prevention and settlement of industrial disputes, as specified in s. 3. This indicates that company employment for ratings would have the support of the Australian Industrial Relations Commission, which is required by s. 90 to have regard for the objects of the Act in taking into account the public interest in the performance of its functions.
In Shipping Industry Reform Authority (1994, p. 4) the view was expressed by the Chairman, Rae Taylor, that significant further reform in the shipping industry could not be achieved without addressing both (1) company employment and the engagement system, and (2) the issue of the competitive gap and strategies needed to be considered to bridge that gap. It is hoped that deliberations of shipowners and unions can produce a satisfactory resolution of the first matter, and in any event that a suitable means can be found to enable the employment of foreign ratings on Australian controlled ships in the international trades, unless some viable alternative is discovered, in order to reduce the competitive gap. One such means for achieving this aim is the proposed establishment of a new category of registration for Australian ships outlined in Shipping Industry Reform Authority (1994, pp. 10-16), and discussed in the previous article.
It was anticipated by Morris (1993, p. 74) that if the shipping reform process is judged to have been sufficient to enhance productivity in the Australian shipping industry, then a similar process of centrally coordinated industry-wide reform in relation to employment matters could be expected to continue. However, Morris warned that further deterioration in Australia’s terms of trade, growing foreign debt, and balance of payments would be likely to result in increased pressure for the deregulation of Australian shipping in an attempt to encourage export growth through lower transport costs, and that if this resulted in removal of protection from the coastal and trans-Tasman trades, then further ship and employment reductions in the Australian fleet could threaten the critical mass essential for the maintenance of shore-based institutions involved in recruitment, training, and management, and put in question the survival of the Australian merchant marine. The warning provides a reminder that a potentially successful approach to further reform should not be allowed to become thwarted in its aspirations by procrastination, delay, and the passage of time. Indeed, it is now time for the reality of Australia’s lack of competitiveness in the international trades to be fully appreciated and grasped by all parties in order that a satisfactory means of overcoming the problem can be achieved to ensure the future of Australian shipping. As reported by Payne (1995, pp. 1-2), some progress was made in this direction through the creation by the Government of a more favourable fiscal environment designed to remove a previously existing anomaly that put Australian shipping at a disadvantage in relation to our international competitors, and it was expected from previous negotiations in the Maritime Industry Restructuring Agreement that shipowners and the MUA would focus attention on resolving the issue of employment arrangements for ratings.
In view of a full bench decision of the Australian Industrial Relations Commission dealing with the limit of its powers in connection with the contracting out of work reported in the Australian Financial Review (Davis 1996, pp. 1 & 4), it is appropriate to explore whether there might be the possibility for an Australian shipowner to enter into a contract for the crewing of a ship in such a way that engagement of the crew is outside the jurisdiction of the Industrial Relations Commission. The recent decision related to an action by the Liquor Hospitality and Miscellaneous Workers Union seeking to obtain an award imposing an obligation on Victorian universities to ensure that contract cleaning and security service providers used by them paid their employees not less than industry standard rates. It was held by the full bench of the Industrial Relations Commission that it remained bound by the 1968 High Court decision in Cocks’ case in which it was decided that a union demand for a prohibition on contract labour was outside the jurisdiction of the Conciliation and Arbitration Commission, and that in the case before it the issue of contracting out was not directly connected with the relationship between the Victorian universities and their own employees so as to create an industrial dispute under the Industrial Relations Act 1988. The Commission was not satisfied that the terms and conditions on which contracts for the provision of cleaning and security services put out to tender were matters pertaining to the relationship between employers in their capacity as employers and employees, and stated that the letting of a contract and its terms had only consequential effects upon the maintenance of the employment relationship. However, the full bench said there might be jurisdiction for the Industrial Relations Commission to make an award regulating contracting out if such an award was ‘incidental’ to the settlement of a general dispute about wages and conditions, and referred the matter of the dispute between the universities and the union back to a single member of the Commission to consider whether such an award was warranted in that case. The narrow view adopted by the Industrial Relations Commission in relation to its powers to impose awards regulating the basis on which employers enter into contracting out arrangements makes it more difficult for unions to secure such awards.
It would be interesting to consider whether there is some way in which an Australian shipowner could contract out the entire crewing service for the operation of a ship in such a way that the owner is not the employer of the crew, and the terms of the contract are beyond the jurisdiction of the Industrial Relations Commission. Such a contract could perhaps cover contracting out of the crewing service for a specified period, and for the crew to operate the ship so as to facilitate the carriage of cargoes as advised on voyages nominated by the owner. The master would be entirely responsible in his capacity as contractor for the actual operation of the ship including the conduct and performance of the crew under his command, and where necessary could act as agent for the owner in relation to the vessel and its cargo. Naturally, all relevant details would need to be carefully considered and included in the contract, and such a contract could possibly provide the means for the employment of foreign seafarers as part of a crew supplied under a contract crewing service to the owner of an Australian controlled ship. It seems the decision of the full bench of the Industrial Relations Commission in connection with the contracting out of services warrants that further consideration be given by the shipping industry to the possible scope for using such contracting out of services in the crewing of ships, even though there might be impediments to overcome, as this could have considerable significance to the ‘employment’ of foreign seafarers on Australian controlled ships. It is appreciated that crew supply and ship management services exist already, but these need to be examined in a wide context that fully embraces any implications or opportunities arising from the decision of the Commission.
This section is concerned with international conventions, particularly conventions of the International Labour Organisation (ILO), but also some recent conventions of the International Maritime Organisation (IMO). These are considered in relation to employing foreign seafarers on Australian controlled ships.
The International Labour Organisation (ILO) was founded in 1919 to facilitate the working together of governments, employers, and trade unions in the cause of social justice and improved living conditions around the world, and in 1946 it became the first specialised agency of the United Nations (Nilssen 1994(a), pp. l & 2). The three fundamental organs of the ILO are (1) the International Labour Conference, which is held annually to discuss reports, and adopt new labour standards in the form of conventions and recommendations covering all aspects of the conditions of work and life of workers, and is attended by government delegations and advisers from most member states and these comprise government, employer, and worker representatives, (2) the Governing Body which determines the Conference agenda and directs the work of the International Labour Office, and is composed of government, employer, and worker members who meet two or three times a year, and (3) the International Labour Office, which is the permanent secretariat of the ILO, and executes decisions of the Conference and Governing Body.
There is a Maritime Industries Branch within the International Labour Office (Nilssen 1994(a), pp. 1-12), and this deals with shipping, fishing, ports, and inland waterways transport. The objective of the Branch’s activities is the enhancement of social and economic progress in these industries as a whole and particularly for workers. This is achieved through a number of activities that include standard-setting, which involves the development of international labour standards for maritime industries in consultation with other technical departments, and the analysis of technical reports by governments on the application of conventions, recommendations, and other Conference decisions relevant to the maritime industries.
Special maritime sessions of the International Labour Conference are convened from time to time to deal exclusively with merchant seafarers. From 1920 to 1987 there were ten maritime sessions of the Conference which adopted a total of thirty-six conventions and twenty-seven recommendations (Nilssen 1994(a), pp. 3-6). A Joint Maritime Commission composed mainly of shipowner and seafarer members advises the Governing Body of the ILO on maritime questions, particularly the selection of items to be submitted to the maritime sessions of the Conference, and the Chairman of the Commission is the Chairman of the Governing Body. Conventions and recommendations setting standards for seafarers have been adopted by the ILO on a range of matters covering general standards, training and entry into employment, conditions for admission to employment, certificates of competency, general conditions of employment, safety, health and welfare, labour inspection, and social security as seen in International Labour Organisation (1994, pp. 7-157).
The maritime labour conventions and recommendations taken together provide a comprehensive set of minimum standards covering almost all aspects of the conditions of work and life of merchant seafarers, and are frequently referred to as the ‘International Seafarers’ Code’ (Nilssen 1994(b), p. 1). In addition, there are ILO conventions dealing with international labour standards applying to all workers including seafarers. The maritime labour conventions and recommendations of the ILO, as well as a record of ratifications for each country of maritime and other international labour conventions as at 14th December, 1993, are listed in International Labour Organisation (1994, Annexes 1-111, pp. 183-190).
The ratification of a convention by a State imposes binding international commitments, and places an obligation on the State to make the provisions of the convention effective through law and practice (Nilssen 1994(a), p. 4). However, a recommendation does not create any international obligation, but is designed to provide guidance to governments in formulating policies. Furthermore, a convention must formally have entered into force before it becomes binding on a ratifying State, and generally ILO conventions provide for entry into force twelve months after registration of the second ratification then for each new ratifying State twelve months after registration of its ratification (Wagner 1994(a), p. 2). However, some maritime conventions require a greater number of ratifications and/or a minimum percentage of world shipping tonnage prior to the initial entry into force. Convention No 147 – Merchant Shipping (Minimum Standards), 1976 is such a convention, and did not enter into force until twelve months after registration of ratification by at least ten States with a total share of world shipping of 25%.
The ILO conventions including maritime conventions ratified by Australia as at September 1994 are shown in Australian Shipowners Association (1994, Attachment A). It is seen that Australia has ratified a total of fifty-four ILO conventions, and these include fifteen maritime conventions. Among the maritime conventions ratified by Australia are No. 9 – Placing of Seamen, 1920 (ratified 1925); No. 16 – Medical Examination of Young Persons (Sea), 1921 (ratified 1935); No. 22 – Seamen’s Articles of Agreement, 1926 (ratified 1935); No. 58 – Minimum Age (Sea) (Revised), 1936 (ratified 1992); No. 92 – Accommodation of Crews (Revised), 1949 (ratified 1992); No. 109 – Wages, Hours of Work and Manning (Sea) (Revised), 1958 (ratified 1972); and No 133 – Accommodation of Crews (Supplementary Provisions), 1970 (ratified 1992). Some of these are revised versions of earlier conventions of similar title that were also ratified by Australia. ILO conventions other than maritime conventions ratified by Australia include No. 87 – Freedom of Association and Protection of the Right to Organise, 1948 (ratified 1973); No. 98 – Right to Organise and Collective Bargaining, 1949 (ratified 1973); and No. 131 – Minimum Wage Fixing, 1970 (ratified 1973). It should be mentioned that Convention No. 109 – Wages, Hours of Work and Manning (Sea) (Revised), 1958 as well as its predecessors Nos 57, 76 and 93 which deal with similar matters, even though ratified by Australia, did not receive the required number of ratifications to enter into force (International Labour Organisation 1994, Annex 1, p. 183).
Among the ILO conventions not ratified by Australia is No. 147 – Merchant Shipping (Minimum Standards), 1976 as discussed subsequently. Convention No. 147 is described by Nilssen (1994(b), p. 2) as constituting the core statement of the International Labour Conference as to what may be regarded as the minimum internationally acceptable labour standards in merchant ships, and prescribes minimum standards of safety, social security, and shipboard conditions relating to the employment and living arrangements that should be observed in merchant shipping under any flag. A number of other ILO conventions are included in the appendix of Convention No. 147, and these cover minimum age, medical examination, articles of agreement, officer’s competency certificates, food and catering on-board ship, crew accommodation, prevention of occupational accidents, sickness or injury benefits, repatriation, freedom of association, protection of the right to organise, and collective bargaining (Nilssen 1994(b), p. 2). Further, there is a provision in Convention No. 147 referring to standards for hours of work and manning to ensure the safety of human life aboard ships.
Convention No. 147 applies, essentially, to all seagoing ships employed for commercial purposes, and came into operation in November 1981. Indeed, it is provided in Convention No. 147 that a ratifying State may, on the basis of a complaint or evidence that a ship fails to conform to the standards of the convention, inspect a foreign ship visiting its ports, whether or not the flag state has ratified the convention (Nilssen 1994(b), p. 3). Such an approach was innovative as, prior to the adoption of Convention No. 147, international rules had been concerned almost entirely with the condition of vessels in the light of any threat they posed to safety or the external environment, and port states refrained from interference in the internal affairs of ships such as the conditions of crew, except where safety was concerned.
It is pertinent to note, however, in the Ships of Shame report (House of Representatives Standing Committee on Transport, Communications and Infrastructure 1992, Overview, pp. xviii-xix and Appendix 5, pp. 129-133) that considerable concern was expressed by the Committee at the treatment by shipowners and operators of many seamen from non-traditional maritime countries, and this concern was based on evidence that there were many occasions where crew were under-paid and under-fed, and worked and lived in conditions not meeting the minimum standards laid down in ILO Convention No. 147, a copy of which is reproduced as an appendix in the Ships of Shame report. Further, the Committee was of the opinion that abuse of crews posed a threat to ship safety. It appears that greater use of port state control as provided for in Convention No. 147 will be required to reduce or eliminate the peril to crews of substandard ships. Indeed, the Committee found that the failure of some flag states to comply with international conventions was a major impediment to the improvement of ship safety.
In the case of Australia, the delay in ratification of Convention No. 147, along with some other conventions, has arisen from the need to determine a suitable definition of ‘sea-going ship’ for the purposes of these conventions, a difficulty arising from the existence in Australia of State and Territory Governments in addition to the Federal Government. The adoption of a definition proposed in 1992 would result in most ships being covered by either the provisions of the Navigation Act 1912 or relevant Federal awards (Australian Shipowners Association 1994, pp. 2-3). This would improve considerably the prospects of ratification by Australia of a number of ILO conventions including Convention No. 147, and it is an Australian policy objective that Convention No. 147 should be ratified. In the meantime, Australia has in place regulations introduced in 1986 by means of Marine Orders Part 11 – Substandard Ships made under the Navigation Act 1912 that provide for the inspection of ships visiting Australian ports to determine their standard in relation to health and safety in the spirit of Convention No. 147. A substandard ship, even though seaworthy, may be detained by the Australian Maritime Safety Authority when conditions on board are clearly hazardous to safety and health (Australian Shipowners Association 1994, p. 3).
It can be expected that in Australia the presence of substandard or unsafe ships of any nation will be effectively monitored, controlled, and deterred by the activities of the Australian Maritime Safety Authority, as evidenced by the high ship inspection rate of 57% during 1994, in the exercise of Australia’s right of territorial jurisdiction under international law, and its role in port state control provided for by international maritime conventions (Australian Maritime Safety Authority 1995, pp. i & 1). This should assist to some extent in increasing the competitiveness of Australian international shipping. It is unlikely that Australian controlled ships, including any that employ foreign seafarers in the international trades, will be found to be substandard, and in any event Australian ships are subject to port state control by other countries including those that have ratified Convention No. 147. The future ratification by Australia of Convention No. 147 should not represent an impediment to the employment of foreign seafarers on Australian controlled ships, and it is interesting to note that several other countries that do employ foreign seafarers on their ships have ratified Convention No. 147. These include the United States (ratified 1988) and Japan (ratified 1983) which control many ships flying Flags of Convenience; Norway (ratified 1979) and Denmark (ratified 1980) which operate second registers; and Liberia (ratified 1981) which has an open register classified by the International Transport Workers’ Federation as a Flag of Convenience (Nilssen 1994(b), Attachment; International Shipping Federation & Lloyd’s Ship Manager 1996, pp. 30, 56 & 64).
Convention No. 109 – Wages, Hours of Work and Manning (Sea) (Revised) Convention, 1958 was ratified by Australia, but did not receive a sufficient number of ratifications to enter into force, and in consequence is not legally binding on Australia. The convention provided for the setting of a minimum basic pay or wages for a calendar month of service by an able seaman, and the means by which the wage figure should be adjusted to take account of matters such as exchange rates and the value of money (Wagner 1994(b), p. 3). Further, the convention urged member States to ensure that the remuneration paid was not less than the minimum rate in the convention. Convention No. 109 was accompanied by Recommendation No. 109 of similar title (Wagner 1994(b), p. 4), and like all recommendations it does not impose any legal obligation, but is adopted to provide guidance only. The provisions on wages in Recommendation No. 109 are similar to those in the corresponding convention, but the wage figure in the recommendation is higher, and this minimum basic wage for able seamen established in the recommendation is updated periodically at sessions of the Joint Maritime Commission comprising shipowners and seafarers.
It was reported in Liberian Shipowners’ Council (1994, p. 3) that it was agreed at a meeting of the Joint Maritime Commission to increase the ILO minimum wage from $356 per month to $385 per month effective for two years from 1 January, 1995. Regular increases in the ILO recommended minimum wage have provided the International Transport Workers’ Federation (ITF) with an accepted criterion on which to judge whether wages on Flag of Convenience ships are ‘substandard’ (Northrup & Rowan 1983, p. 220), and indeed courts in various countries have tended to take into account the ILO minimum wage when considering the legality of an ITF boycott. Moreover, regular increases in the ILO minimum wage have had the effect of reducing the differential between maritime wages in western Europe and North America and those paid to seafarers in developing countries, and this assists the alleged ITF policy of protecting the employment of seafarers from developed countries. Mention should be made in the context of wages of the practice known as double bookkeeping (Forsyth 1993, p. 210) whereby some shipping companies keep two sets of books, and this involves, basically, the signing by seafarers of two separate contracts specifying different wage levels that reflect on the one hand ITF acceptable wages and on the other much lower wages actually paid to the seafarers. The scheme is enforced through the blacklisting of seamen who refuse to accept the system or complain subsequently, in circumstances where employment opportunities at sea are better than those available in their home countries. The existence of this double bookkeeping practice means that the operations of some shipowners are more competitive in terms of crew costs than might appear to be the case.
In addition to ratifying Convention No. 109 discussed above, which did not come into force, Australia has ratified Convention No. 131 – Minimum Wage Fixing, 1970, which is a convention of general application related to the establishment of a system of minimum wages covering all groups of wage-earners whose terms of employment are such that coverage would be appropriate (Industrial Relations Act 1988, Schedule 5). The convention concerns the question of awards discussed earlier, and its application in Australia needs to be considered further to ensure that it does not present any problem to the employment of foreign seafarers on Australian-controlled ships involved in the international trades. In this context it might be important to draw a distinction between the domestic employment of seafarers in the coasting trade, and the employment of foreign seafarers in the international trades, where such seafarers are employed on a regular basis by many countries engaged in these trades.
As mentioned earlier, other conventions of general application ratified by Australia include Convention No. 87 – Freedom of Association and Protection of the Right to Organise, 1948 and Convention No. 98 – Right to Organise and Collective Bargaining, 1949. Both these conventions have been ratified by a great many countries (International Labour Organisation 1994, Annex 111, pp. 187-190), including those on whose ships foreign seafarers are employed, such as Norway and Denmark which have established second registers, Liberia and Panama which operate open registers regarded by the ITF as Flags of Convenience, and Japan which controls ships flying various flags, and the ratification by Australia of Conventions Nos 87 and 98 should not be an impediment to the employment of foreign seafarers on Australian controlled ships.
In 1958 the Intergovernmental Maritime Consultative Organisation (IMCO) was established as a permanent specialised agency of the United Nations to deal with technical matters related to shipping. In 1982 the name of the organisation was changed to the International Maritime Organisation (IMO) as described by Ross (1995, pp. 8-9). The two main objectives of the IMO are the promotion of maritime safety and the prevention of pollution from ships, as enshrined in the slogan ‘safer shipping and cleaner seas’. The organs through which the IMO operates are the Assembly, which is composed of representatives of more than one hundred and thirty member States which meets every two years and a Council comprised of representatives of thirty-two member States which acts as the executive governing body and an administrative Secretariat headed by the Secretary-General based in London. The IMO is an intergovernmental body with shipowners and unions acting in an advisory capacity to their respective governments. The technical work of the IMO is conducted through a number of committees and subcommittees that include the Maritime Safety Committee and the Marine Environment Protection Committee.
The IMO is renowned particularly for its work in the development of international maritime conventions which are adopted at conferences of the Assembly and ratified subsequently by individual governments. According to Ross (1995, p. 8) the main IMO conventions are accepted by countries with combined merchant fleets accounting for 97% of total world shipping. Among the international conventions adopted by the IMO are the International Convention for the Safety of Life at Sea, 1974, and its Protocols of 1978 and 1988; the Convention on International Regulations for Preventing Collisions at Sea, 1972; the International Convention on Load Lines, 1966, and its Protocol of 1988; the International Convention for the Prevention of Pollution from Ships, 1973, and its Protocol of 1978; and the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978. In addition, the IMO has developed a number of Codes containing recommendations that provide a guide to standards. Such a code is the International Safety Management (ISM) Code which is discussed in more detail later.
After many years of preparation, the International Convention on Standards of Training, Certification and Watchkeeping for Seafarers, 1978, known as the STCW Convention, 1978, was adopted at an international conference convened by the IMO in association with the ILO, and this convention entered into force in April 1984 (Gaskell, Debattista & Swatton 1987, pp. 118-119). The States parties to the STCW Convention were obliged through domestic legislation to give effect to the Convention and its Annex to ensure, from the viewpoint of safety and the environment, that seafarers on board ships were qualified and fit for their duties. Regulations in the Annex contained basic principles and a syllabus for the training of each category of seafarer, and this varied with the type and size of ship. However, this first attempt at establishing crew standards on a global basis became progressively out of date, and in December 1992 it was decided (O’Neil 1993, p. 13) that the convention should be completely revised to allow for more flexible certification arrangements and for new developments such as the use of training simulators.
Australia participated in the IMO Subcommittee on Standards of Training, Certification and Watchkeeping with shipowner, union, and training representatives being included in the Australian delegation (Australian Maritime Safety Authority 1994, pp. 32-33), and it was anticipated that the new STCW Convention would retain the traditional approach to training and certification, while providing for the multi-skilling of crew appropriate to reduced manning in the operation of future high-technology shipping. Naturally, it was regarded as important to Australia that the gains from recent reforms in the shipping industry should not be disadvantaged by the inactions of other countries in the proper implementation of standards, and that the revised STCW Convention should enhance rather than impede further restructuring in the Australian maritime industry. Indeed, it was asserted in International Chamber of Shipping and International Shipping Federation (1995, p. 1) that the conference scheduled to finalise the adoption of the revised STCW Convention must agree to an effective mechanism to ensure compliance, otherwise the competency of many seafarers around the world will not be improved and a genuine opportunity to raise standards will have been lost.
In July 1995 a substantially revised STCW Convention was adopted by the IMO for entry into force in February 1997. It concentrates on three main themes (Horrocks 1995, pp. 2-4), namely the attainment of precise mandatory levels of competence, the compliance of training and certification systems as well as validation of foreign certificates with STCW standards, and alternative approaches to certification including greater flexibility between deck and engine department training. It can be expected that the training and certification of any foreign seafarers employed on Australian controlled ships will conform to the standards of the revised STCW Convention.
Another important initiative of the IMO was the development of a new and detailed international safety management code based on recognition that the shipowner has primary responsibility for safety and that such responsibility does not cease when a ship leaves port (O’Neil 1993, p. 14). The International Safety Management Code (ISM Code) was adopted by the Assembly of the IMO in November 1993, and is reproduced in Australian Shipowners Association and Australian Maritime Safety Authority 1995 (Appendix D, pp. 61-69). The ISM Code is intended to provide an international standard for the safe management and operation of ships and for pollution prevention (Quirk 1995, p. 7). According to Lloyd’s Ship Manager (1995(b), p. 16) the ISM Code constitutes the inaugural international auditable quality management standard dealing with safety and environmental protection for shipping at sea, and imposes ten broad responsibilities embracing disclosure of information; statement of policy; involvement of top management; authority of the ship’s master; written procedures; issue of manual; adequacy of resources; emergency response plan; reporting procedures; and review. The ISM Code, along with other quality systems already adopted voluntarily by a number of shipowners, is intended to ensure (Horrocks 1995, p. 2) that the safety process is applied at all levels within a shipping company so that operations afloat and ashore are complementary, and not just two separate and unconnected entities related to safety.
The ISM Code was to be incorporated in July 1998 as a new Chapter IX in the International Convention for the Safety of Life at Sea, 1974 (the SOLAS Convention, 1974), and from July 1998 was to become mandatory on a sliding time scale depending of the type and size of ship (Lloyd’s Ship Manager 1995(b), p. 16). However, the earlier application of the ISM Code for Australian ships was introduced on a voluntary basis, and from July 1998 compliance with the ISM Code was to become the responsibility of the Australian Maritime Safety Authority as part of its port state control activities (Quirk 1995, pp. 8-9). The ISM Code will apply to the management of Australian-controlled ships on which foreign seafarers are employed, and this needs to be borne in mind in any consideration of contracting out crewing services.
Finally, it should be mentioned that the IMO conventions involve a three-tier system in which the IMO adopts legislation, flag states implement and enforce it, and port states verify its compliance, and this should ensure the safety of shipping and environmental protection of the oceans, provided all parties carry out their duties with diligence and determination, as observed by O’Neil (1993, p. 15). In more recent years the role of port state control has been assisted by regional co-operative arrangements between countries, exemplified by the Paris Memorandum of Understanding on port state control in Europe, and more recently the Tokyo Memorandum of Understanding covering port state control in the Asia-Pacific region (Australian Maritime Safety Authority 1994, pp. 19-20). However, the first responsibility for the advancement of safety at sea rests with the shipowner as stated by Papachristidis (1993, p. 3), and attention is drawn by Yamana (1993, p. 8) to the fact that the interests of an independent ship manager in the operation of a vessel are not necessarily the same as those of the shipowner. In the Ships of Shame report (House of Representatives Standing Committee on Transport, Communications and Infrastructure 1992, Overview, p. xviii) the Committee concluded on the basis of evidence before it that the IMO international convention standards were adequate, and that the problem was non-compliance with those standards.
The International Transport Workers’ Federation is essentially similar to other major international trade union secretariats in terms of structure, management, and finance, but is clearly distinguishable from them because of its activities in relation to ocean transport, and in particular its campaign against ‘Flag of Convenience’ ships (Northrup & Rowan 1983, pp. 1 & 30).
Since 1948 the International Transport Workers’ Federation (ITF) has maintained a campaign against the use of Flag of Convenience (FOC) shipping, which is a practice whereby shipowners register ships they control in countries other than their own, such as Liberia and Panama, in order to benefit from lower costs, particularly crewing costs. The ITF campaign against FOC ships has been directed especially at increasing the wages of seafarers crewing such ships and indirectly at protecting the employment opportunities for mariners in developed countries (Gaskell, Debattista & Swatton 1987, p. 145). In ascertaining whether a particular ship is flying a flag of convenience the ITF emphasises the lack of a ‘genuine link’ between the country of beneficial ownership and the country of registration as stated in a 1990 ILO Conference paper quoted by Payne (1991, p. 7), and where there is absence of such a link the ship is regarded by the ITF as sailing under a flag of convenience.
A general classification of FOC registers and second registers has been drawn up by the ITF ‘Fair Practices Committee’, which is a joint committee of ITF seafarer and dockworker unions that runs the ITF campaign against FOC shipping, and lists of both FOC and second registers are published by the ITF (Lloyd’s Ship Manager 1995(a), p. 3). In 1994 the ITF list of FOC registers comprised Antigua and Barbuda, Bahamas, Belize, Bermuda, Canary Islands (Spain), Cayman Islands, Cyprus, Cook Islands, Gibraltar, Honduras, Lebanon, Liberia, Malta, Marshall Islands, Mauritius, Myanmar, Netherlands Antilles, Panama, St. Vincent, Sri Lanka, Tuvalu, and Vanuatu, while the ITF list of second registers covered those of the British Isles (Isle of Man), Denmark (DIS), Germany (GIS), France (Kerguelen Islands), Portugal (Madeira), and Norway (NIS). The most important criterion used by the ITF in drawing up the list of FOC registers is that the majority of vessels on the register are foreign-owned or controlled (Lloyd’s Ship Manager 1995(a), p. 3). However, a ship that is proved to be genuinely owned in a country designated by the ITF as a FOC will be regarded as a national flag vessel, and conversely a ship that is registered on a traditional or second register, but not nationally owned, will be regarded by the ITF as a FOC vessel. Some registers such as those of Hong Kong, the Philippines, and Singapore do not fit clearly into the ITF classification, and vessels on these registers are considered by the ITF on a ship-by-ship basis. More recently, the German international register (GIS) was redesignated by the ITF from second register to FOC status as from April 1995 following pressure from German seafarers after a failed attempt to have the register declared illegal under domestic legislation, and this reflected a hardening in position of the ITF in relation to second registers (International Shipping Federation & Lloyd’s Ship Manager 1996, p. 4). In consequence, ships on the GIS register became potentially subject to boycott action unless covered by ITF approved collective agreements.
In the conduct of its campaign against FOC ships, the ITF issues a ‘blue certificate’ to an FOC vessel in respect of which there is an ITF ‘Special Agreement’ between the ITF and the shipowner covering matters such as minimum wages, holidays, hours of work, and other conditions of employment, and providing for the payment of financial contributions by the shipowner to the ITF ‘Seafarers’ International Assistance, Welfare and Protection Fund’. ITF policy against FOC ships is enforced by the ‘blacking’ of a ship that is unable to produce a blue certificate to an ITF inspector (Gaskell, Debattista & Swatton 1987, pp. 145-146). The blacking of a ship can be made effective by stevedoring employees and tug crews refusing to handle the ship until ITF conditions such as demands for backpay and ITF Welfare Fund contributions are met, and frequently shipowners succumb to such demands to avoid large costs involved in the delay of a ship that can result from time-consuming legal action. The standard terms and conditions that apply to seafarers serving on a ship for which there is a ‘Special Agreement’ are set out in the ITF Standard Collective Agreement for crews on Flag of Convenience ships (International Transport Workers’ Federation 1994, pp. 1-26), and this agreement includes in Annex 1 the ITF Wage Scale that covers each category of seafarer and in the case of an able seaman prescribes a basic pay from January 1994 of US$856 per month to which certain specified supplementary payments are added. The ITF accepts national collective agreements of affiliated unions as an alternative to its own agreement provided they are at least as favourable to seafarers (Northrup & Rowan 1983, p. 125), but problems can arise if such national agreements are not enforced.
It has been acknowledged by David Cockcroft, General Secretary of the ITF, that growth in the number of ITF approved collective agreements was a sign of failure of the FOC campaign, and that the ITF had not achieved the central objective of the FOC campaign, namely returning ships to their genuine national flag, but he asserted that this remained the main political aim of the ITF and would not be abandoned (Lloyd’s Ship Manager 1995(a), p. 3). In the case of the United Kingdom it is interesting to observe (Gaskell, Debattista & Swatton 1987, pp. 146-147) that the Employment Acts of 1980 and 1982 have made the ITF very vulnerable to actions in tort that could result from interference by unlawful means in the performance of a contract, and further that the absence of provisions in the ITF rules for secret pre-strike ballots could make ITF action unlawful under the Trade Union Act 1984.
The ITF basic wage of US$856 per month that applied in January 1994 for an able seaman engaged on a FOC ship covered by a ‘Special Agreement’ (International Transport Workers’ Federation 1994, Annex 1) was very substantially higher than the ILO recommended minimum wage of US$356 per month applying at that time (Liberian Shipowners’ Council 1994, p. 3). Furthermore, there is considerable opposition in the developing countries of Asia to the view of the ITF that governments should be encouraged to implement the ILO recommended minimum wage on the grounds that this would create undesirable ‘islands of wealth’ in these countries (N. Chambers, pers. comm. 1994). Indeed, disparity in 1973 between the ILO recommended minimum wage of £48 per month that the ITF was demanding should be paid on all ships and the lower wage levels then prevailing for able seamen in India, Pakistan, and Bangladesh, coupled with the prohibition by the governments of those countries against domestic shipowners registered in their countries from paying more than £32 per month, resulted in an historical agreement between the ITF and the International Shipping Federation (ISF) that lasted from 1973 to 1978 and provided for the payment of wages less than the ILO recommended minimum by shipowners employing seafarers from the Indian subcontinent (Northrup & Rowan 1983, pp. 96-99). However, it was made clear by the ITF that the agreement with the ISF did not apply to ships classified by the ITF as flying a FOC. More recently, it was reported (International Shipping Federation 1993, pp. 1-2) that a meeting of the Asian Seafarers’ Summit held in Manila in December 1993 had passed a resolution urging the ITF not to increase wages for at least a year on the grounds that the imposition of a 10% increase demanded by the European affiliates of the ITF would prejudice the interests of Asian seafarers. The decision was described as responsible by David Dearsley, Secretary of the ISF, and the unions signing the resolution represented a large majority of the world’s seafarers. In practice, many seafarers working on FOC ships do not receive, or are suspected of not receiving, ITF minimum wages, and the seafarers availing themselves of ITF assistance in obtaining backpay are frequently blacklisted by their own countries or by shipping companies (Northrup & Rowan 1983, pp. 106-111; Forsyth 1993, p. 210).
Mention should be made that the ITF is not even-handed in its actions in relation to the level of wages paid to seafarers, but rather is preoccupied with FOC shipping in this regard. The ITF was not concerned with the operation of ships registered in the former communist bloc countries of eastern Europe even though it was generally recognised that the terms and conditions of employment on these ships were considerably inferior to those applying on many FOC vessels (Northrup & Rowan 1983, pp. 123 & 125). Also, it does not generally take action against ships such as those of the People’s Republic of China and India which pay very low wages to national crews and trade internationally, but fly the national flag so are not targeted by the ITF which is concerned primarily with FOC ships (Craig-Bennett 1995, p. 2). Moreover, the ITF has been accused by the Liberian Shipowners’ Council (1994, pp. 1-2) in the operation of its myopic policy in relation to open registers of not recognising the variable quality of standards exhibited by different open registers, and of knowingly treating good and bad shipowners alike with resulting benefit to the ITF.
The role of collective agreements between shipowners and seafarer unions has become widely accepted in most countries in the Asian region, and an important contribution to the success of both India and the Philippines in promoting their seafarers on foreign ships has been the part played by unions in these countries in gaining the support of the ITF (Sien 1994, pp. 7 & 13). Further, acceptance by the Japan Seamen’s Union was essential to the employment of Philippine seafarers on Japanese Maru ships.
In the case of the Norwegian second register (NIS) that was created by act of parliament (the NIS Act) in 1987, there are no restrictions on the nationality of a ship’s crew except that the master must be Norwegian, and even this is subject to dispensation for which applications are treated liberally (International Shipping Federation & Lloyd’s Ship Manager 1996, pp. 64 & 66). The NIS Act provides that collective agreements can be entered into by shipowners with Norwegian and foreign unions, and there is no general agreement between the Norwegian Shipping and Offshore Federation (ASO) with Norwegian unions regarding collective agreements for non-Norwegian seafarers. Indeed, the ASO believes that collective agreements covering non-Norwegian seafarers should be negotiated with national and local seafarer unions that organise the non-Norwegian seafarers that are employed on NIS ships, whereas the Norwegian unions are of the opinion that ITF policy should be followed with Norwegian unions participating in negotiations for all seafarers on NIS ships, what ever their nationality, and being party to all collective agreements covering NIS vessels (International Shipping Federation & Lloyd’s Ship Manager 1996, p. 66).
This difference of opinion between Norwegian shipowners and unions has not prevented the conclusion by the ASO of collective bargaining agreements with maritime unions in Norway, India, and the Philippines covering seafarers employed on ships registered on the NIS, and an outline of these agreements is given in International Shipping Federation and Lloyd’s Ship Manager (1996, p. 67). In addition, Norwegian unions have entered into agreements involving foreign seafarers with shipowners without participation of the ASO, and the ASO has concluded agreements with Indonesian, Pakistani, and Polish unions without Norwegian union involvement. Further, there are several company collective bargaining agreements for Russian, Croatian, Portuguese, and British seafarers. Finally, it is possible in the case of the NIS for shipowners to engage seafarers on employment contracts without reference to a collective agreement or approval from a trade union, subject to the contract conforming with the Norwegian Seamen’s Act which provides, among other things, for an agreement to run for an unlimited period of time. It is seen that a number of different agreement options for employing foreign seafarers are available under the Norwegian second register, and further consideration of these would be useful in connection with the possible establishment of a second register for Australian shipping.
The Danish Shipowners’ Association (DSA) has concluded collective bargaining agreements with unions in India and the Philippines without participation of Danish unions for the employment of seafarers from these two countries on Danish second register (DIS) ships (International Shipping Federation & Lloyd’s Ship Manager 1996, pp. 57-58). In both the Philippine and Indian agreements wages are generally comparable with the ITF concept of ‘total crew cost’, and in addition special provisions have been agreed with Danish trade unions that where mixed nationality crews are employed on the same ship, then similar conditions in relation to work and wages should apply to all seafarers engaged in the same capacity on that ship. Such an agreement as the latter, if made, should not present a difficulty for the employment of foreign seafarers on Australian controlled ships in the international trades, and it is most likely that all seafarers employed in the same capacity on the same ship would have the same nationality.
Historically, Australia has proved to be fertile ground for ITF activities against FOC shipping, and the participation of Australian maritime unions in the ITF campaign has led to considerable success in relation to campaign objectives (Northrup & Rowan 1983, pp. 155-178). Further, the attitude of Australian shipowners to the ITF campaign appears to have been one of either indifference or prudent inactivity. In the case of the Australian government it has depended largely on the political persuasion of the party in power. For instance, in 1974, Mr C. K. Jones, the then Minister for Transport in a Labour government, stated in the Australian parliament that he agreed ITF rates should be paid to all crews on international ships, and that it was part of Labour Party and trade union movement policy (Northrup & Rowan 1983, p. 174), whereas in 1977 the then Liberal-National Party coalition government joined Utah (prior to its acquisition by BHP in 1983) in legal action against the then existing Seamen’s Union of Australia (SUA) in the Federal Court of Australia seeking an injunction against a SUA boycott pursuant to s. 45D of the Trade Practices Act 1974 (Northrup & Rowan 1983, pp. 90-91). In that case the ITF was prepared to issue a blue certificate, but could give no guarantee that its affiliated SUA would recognise it. The legal action by Utah was successful, and the SUA failed in an appeal to the High Court of Australia against the decision of the Federal Court. Since that time the Trade Practices Act 1974 has been modified by the Industrial Relations Act 1988 as discussed earlier, but it is possible that the previously existing secondary boycott provisions of the Trade Practices Act 1974 could be restored by the Liberal-National Party government (Lewis & Thomas 1996, p. 5).
If the employment of foreign seafarers on Australian-controlled ships is achieved by means of a traditional register or second register, there would be a ‘genuine link’ between the country of ownership or control and the country of registration, and Australian ships should not become part of the ITF campaign against FOC shipping. However, the decision by the ITF to classify the German second register (GIS) as a FOC gives rise to some concern. In the case of employing foreign seafarers on Australian-controlled ships under foreign registry, it could be expected that such ships would be targeted by the ITF as flying a FOC, and in the absence of collective agreements acceptable to the ITF the ships would become subject to ITF boycott activity. However, ships regarded by the ITF as FOC continue to operate successfully around the world, and it is possible also that Australia could introduce legislation as was done in the United Kingdom that makes the activities of the ITF against FOC ships more difficult.
Industrial matters related to the employment of seafarers are covered by both domestic legislation and international conventions, and are influenced by the operations of the International Transport Workers’ Federation. However, there do not appear to be any major impediments to the employment of foreign seafarers on Australian controlled ships, although progress will need to be made towards company employment of ratings as distinct from the current engagement system. Moreover, it is desirable for any employment of foreign seafarers to be achieved through cooperation between shipowners, unions, and government.
The author expresses particular thanks to Mr Lachlan Payne of the Australian Shipowners Association for his support and the provision of access to library facilities, to Commodore Sam Bateman of the Centre for Maritime Policy at the University of Wollongong for his encouragement and making possible the publication of the present work, and to Mrs Jillian Stevens of Adelaide for her dedication with the word-processing. The series of three companion articles is based on the thesis of the author that resulted in him becoming in 1997 the first Master of Business (Maritime Management) graduate of the Australian Maritime College.
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[1] This is the second of three major articles by Dr Eadie dealing with the employment of foreign seafarers in Australian ships to be published in successive issues of Maritime Studies.
[2] Research Consultant, Adelaide, South Australia.
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