Stern letter to ExxonMobil chief

FEDERAL Opposition leader Bill Shorten has again weighed into the Bass Strait and Longford UGL dispute, telling Esso that Labor plans to put an end to “sham” work agreements.

Mr Shorten sent a curt letter to ExxonMobil Australia chair Richard Owen last week, saying Labor would change the law so that workers and their unions could apply to the Fair Work Commission to re-negotiate “sham agreements”.

“I am particularly concerned that UGL tendered on the basis of an enterprise ‘agreement’ approved by just five casuals in Western Australia, through its shell subsidiary MTCT, none of whom worked in the area the company now seeks to use the agreement,” Mr Shorten wrote.

“Labor is very concerned about these sham agreements, and has promised to legislate to make clear that the workers who vote on an agreement must be representative of the workers who may ultimately be covered by the agreement.”

Mr Shorten told Mr Owen he had been advised the new agreement had cut wages by 30 per cent or more, cut annual leave entitlements, allowances and shift loadings, and introduced a new, less family friendly, roster “that is inconsistent with workers having a decent quality of life”. 

“As you should be aware, Carlton and United Breweries used a similar approach with their maintenance contractors and after 180 days were forced to reverse their decision, but only after significant reputational damage and loss of market share,” Mr Shorten added.

“Resource companies operating in Australia should be conscious of the social licence with which they operate.”

Electrical Trades Union Victoria secretary Troy Gray said using an EBA agreed by five “handpicked workers” to cut the pay of 230 other workers was not acceptable in Australia.

“It is a sham,” he said.

“We’re glad Bill Shorten has put this corporation on notice.

“Foreign-owned Exxon needs to get with the program.”

Mr Gray said Australians were beginning to “cotton onto” what some big businesses were doing to workers. 

“They’re cutting our pay, they’re making our work casual — and a third of them aren’t even paying tax,” he said.

“ExxonMobil is the largest oil and gas company in the world.

“You tell me how they made $24.8 billion tax free in Australia, but they haven’t got the money for fair pay and a predictable roster.”

Mr Shorten also addressed the issue of corporate tax in his letter to Mr Owen, noting that the Senate Inquiry into Multinational Tax Avoidance had been extended so as to allow ExxonMobil to be questioned about its arrangements.

In December, ExxonMobil reported through the Australian Tax Office that the company paid no corporate income tax for a third consecutive year, bringing its tax-free earnings since 2013 to $24.8 billion.

In answer  to questions from the Gippsland Times, an Esso spokesperson said he believed Mr Shorten’s letter was being responded to, and he hoped to issue more information next week.

He pointed to online information about Esso’s tax contributions, available at

It states that since 1990, when Petroleum Resources Rent Tax  was first applied to the Gippsland Basin, Esso Australia had paid “more than $12 billion in this tax alone”. 

“This is on average more than $450 million paid to the federal government each year for nearly a quarter of a century,” the statement reads.

“When combined with corporate income tax, this equates to an effective tax rate on profit of over 50 cents per dollar over the last decade.”

Mr Shorten’s stern letter comes days before Exxon executives are due to face questions from senators at the inquiry, next Wednesday, March 14, in Melbourne.

The 230 onshore and offshore maintenance workers are represented by the Electrical Trades Union, the Australian Manufacturing Workers’ Union and the Australian Workers’ Union.

The unions have launched a marginal seat campaign across the country to push Coalition MPs to crack down on corporations avoiding company tax.

Protesters have now been camped outside the Longford Gas Plants for 261 days.

It is currently the longest running industrial dispute in Australia, and one of the longest ever in Australia’s history.

Mr Shorten invited Mr Owen to meet with him to discuss the issues raised in his letter.