Aware Super sees protests over alleged non-union labour contracts

2 April 2024
| By Rhea Nath |
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One of Australia’s mega funds has been the focus of trade union action over labour standards on a New York City development project.

Announced in 2020 as a joint venture with Lendlease, the $1 billion project at 1 Java Street was intended to develop a 2.6-hectare site located on the Greenpoint-Williamsburg waterfront for residential apartments. Once developed, the building was expected to be New York State’s largest geothermal residential building.

The acquisition of the land was based on a 25 per cent interest for Lendlease and a 75 per cent interest for Aware Super.

However, Unions NSW, CFMEU, Public Service Association, and Health Services Union raised a number of concerns regarding the project as they picketed Aware Super’s office in Sydney last week.

“Unions NSW first alerted Aware Super’s leadership to serious concerns about labour standards on the project in May 2022,” Unions NSW said in a statement.

In the statement, the peak body for unions in NSW alleged that the project has contracted companies with a history of wage theft and union busting, such as one contractor whose owner allegedly served 11 months in prison for tax evasion from defrauding a union pension fund, and avoiding social security taxes for its use of non-union workers. 

The group also highlighted the alleged use of underpaid and undertrained workers on the project, who earn less than the prevailing industry wage. 

Moreover, quoted in the statement, Mark Morey, secretary of Unions NSW alleged that Aware Super, which consists of more than 1.1 million members including nurses, paramedics, and other essential workers, “loves to burnish its cuddly ESG values when it is trying to recruit or retain essential workers to its fund”.

“Super funds like Aware need to realise they can’t speak with a forked tongue. They can’t pretend to care about social housing or carbon emissions but then turn a blind eye to poor labour practices,” Morey said.

“All we are seeking is basic answers. ESG is all about transparency. Despite committing to an audit of labour practices, Aware now wants to keep the results under wraps. Why?”

The group called on the fund to publicly release its audit of labour practices to show compliance with modern slavery and ESG principles. 

“Australian workers will rightly be appalled to learn their retirement savings are bankrolling anti-worker firms whose owners have been jailed for defrauding the US pensions funds and avoiding social security taxes. If the shoe was on the other foot, and members of Aware Super were being dudded by bad bosses, the fund’s executive leadership would rightly be appalled,” Morey said. 

“While union appointed directors of Aware are legally prevented from discussing board matters, I imagine they are seething about this episode. We are confident they are holding executives to account. But those executives need to explain themselves publicly.”

Super Review reached out to Aware Super for comment and was told that what is being reported regarding workers employed on the 1 Java Street project isn’t entirely correct. 

A spokesperson for the fund said: “Throughout the project life cycle, the project worksite is utilising both union and non-union subcontractors, including the initial work having been awarded to a union subcontractor. 

“We are deeply committed to the safety of workers across all of our investments, wherever they are in the world. It is unequivocal, and we are unwavering in our commitment to workplace benefits, health and safety with all our investment partners, as we invest for the best financial interests of our 1.1 million members who work, live and retire here in Australia.”

Super Review understands that 30 per cent of the 1 Java Street contract value to date has been awarded to union contractors, representing approximately 150 union jobs.

“Like all companies in our sector, we align with the custom and practice of our local markets – always with a focus on safety, efficiency, and quality,” a spokesperson for Lendlease told Super Review.

The project partner also reiterated that it holds a strong track record of working constructively with organised labour on its projects globally.

“We continue to be in regular dialogue with unions in the US regarding our New York City projects,” it said.

Unions NSW is, however, vowing to continue the protest, noting also last week that “workers’ hard-earned superannuation money shouldn’t be used to undermine the wages and conditions of workers anywhere in the world”.

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