€¦ · web viewroyal commission into trade union governance and corruption. maritime union of...

ROYAL COMMISSION INTO TRADE UNIONGOVERNANCE AND CORRUPTION

Maritime Union of Australia

Level 5, 55 Market Street, Sydney, NSW 2000

On Monday, 29 September 2014 at 10.00am

Before the Commissioner: The Hon. John Dyson Heydon AC QC

Counsel Assisting: Mr Jeremy Stoljar SCMs Fiona Roughley

Instructed by: Minter Ellison, Solicitors,

.29/09/2014 1Transcript produced by Merrill Corporation

1 THE COMMISSIONER: Yes, Mr Stoljar.23 MR STOLJAR: Today's hearing concerns the Western4 Australian Branch of the Maritime Union of Australia,5 Commissioner. The hearing will consider the circumstances6 in which numerous companies have agreed to pay substantial7 sums to the MUA or related entities of the MUA. The8 payments have ranged from the thousands of dollars to, in9 one case, $1 million. The Commission will hear evidence10 that many of these payments were made by the companies11 effectively in order to buy or maintain industrial peace12 with the MUA and its members.1314 Four case studies will be explored in the evidence15 today.1617 Saipem and the Blacktip Gas Project1819 The first concerns the Blacktip Gas Project. The20 Blacktip gas field is located west of Darwin in the21 Timor Sea's Bonaparte Basin. It supplies gas to the22 Northern Territory's domestic market. The gas field is23 owned and operated by ENI. The project was worth24 approximately $700 million and included an offshore25 platform, a 108-kilometre offshore pipeline, an onshore gas26 processing plant and a 285-kilometre onshore pipeline.2728 The company, Saipem (Portugal) Commercio Maritimo,29 Sociedade Unipessoal, LDA, won the Engineering,30 Procurement, Installation and Construction contract for the31 Blacktip platform and export pipeline. That necessitated32 it requiring tugboats to assist in its pipe laying and33 other associated activities.3435 In August 2008, Saipem was confronted with a shortage36 of domestic tugboats and crew available to service its37 Blacktip Project works. Saipem proposed to source foreign38 tugs and crew to work on this aspect of its Blacktip39 activities. The Commission will hear evidence that40 Saipem's proposal was fiercely opposed by the MUA, in41 particular the State Secretary of the MUA Branch,42 Mr Christopher Cain. The MUA, led by Mr Cain, said that it43 would not accept foreign tugs entering the Australian44 Maritime Complex at Henderson or the Port of Darwin and45 threatened that, if this did happen, it would take action46 to disrupt the project supply chain and activities on the47 project site.


12 It needs to be remembered that these discussions did3 not form part of any formal bargaining process between4 Saipem and the MUA relating to employment conditions for5 crew engaged on the tugs or the broader Blacktip Project.6 Rather, the MUA's threat, and the location of its muscle,7 was that the union and its members engaged elsewhere on the8 Blacktip Project would cause strife to Saipem's broader9 operations if Saipem proceeded with its proposal to source10 foreign-crewed tugs.1112 Eventually the MUA and Saipem reached a deal. Saipem,13 on behalf of ENI, agreed to commit $1 million to a newly14 created relevant entity associated with the MUA. That15 entity is the Maritime Employees Training Limited (METL).16 Saipem and ENI understood that, in return for this17 commitment, the MUA would assist in achieving a successful18 project and that the MUA's members and officials would not19 impact negatively on the Blacktip Project by causing20 industrial strife.2122 METL is a registered training organisation, or RTO.23 It is a not-for-profit unlisted public company established24 in August 2008 by Mr Paddy Crumlin, Mr Chris Cain,25 Mr Rod Pickette and the MUA's lawyer, Mr Bill McNally.26 Mr Crumlin is the National Secretary of the MUA.27 Mr Pickette is also an official of the MUA. The CEO of28 METL is Mr Simon Earle.2930 METL was established because there appeared to be31 a lack of planning for training in the maritime industry32 and there was a need for a co-ordinated approach to support33 growth in the industry, particularly in the oil and gas34 sector. The type of training that METL provides - for35 example, training for a person's integrated ratings36 ticket - is cost and labour intensive. It takes about37 18 months and $77,000 per trainee to qualify for the38 integrated ratings ticket.3940 When companies like Saipem come to Australia with41 a short-term project needing qualified seamen, a shortfall42 in supply in the domestic labour market cannot be met in43 the short term. The purpose of METL was to provide44 training and associated facilities to maritime employees so45 as to build up domestic labour supply to meet the46 anticipated demands of future projects particularly in the47 oil and gas space, like the Blacktip Project, and another,


1 the Gorgon Gas Project, to which I shall return.23 METL's Board of Directors comprises Mr Crumlin,4 Mr Cain and two employer representatives. Its accounts are5 audited. Whilst the financial management and governance6 arrangements of METL are of relevance to paragraph (a) of7 the Terms of Reference, it is not named here today because8 of any concern on the part of the Commission as to the9 legitimacy of its operations or governance arrangements.10 Rather, the concern relates to an issue that falls within11 paragraph (d) of the Terms of Reference, being the12 circumstances in which the MUA has extracted significant13 funds from companies such as Saipem and directed that those14 moneys be paid to METL as a condition of receiving15 industrial peace. The net effect of these types of16 arrangements is to add to the bottom line of those17 projects.1819 The Commission will hear evidence from Mr Fabio20 Di Giorgi, who was appointed the Australian Project Manager21 of the Blacktip Project. The Commission will also receive22 an affidavit from Mr David Lansbury, who was an external23 industrial relations consultant to Saipem in connection24 with the Black Tip Project. Mr Danilo Codazzi, the25 Administration, Finance and Control Manager of Saipem, has26 also supplied a statement to the Commission to evidence the27 fact and timing of the payments Saipem made.2829 Finally, the Commission will receive evidence from30 Mr Earle as to the operations of METL, Mr Paddy Crumlin31 concerning the Saipem contributions and the activities of32 METL more broadly, and Mr Chris Cain.3334 Sapura and the Gorgon Gas Project3536 The Gorgon Gas Project is one of the world's largest37 natural gas projects and is the largest single resource38 development in Australia's history. It is located off the39 north-west coast of Western Australia. It is operated by40 Chevron Australia Pty Ltd and is a joint venture project of41 Australian subsidiaries of Chevron, ExxonMobil, Shell,42 Osaka Gas, Tokyo Gas and Chubu Electric Power. In 2010,43 Chevron and SapuraKencana Australia Pty Ltd, "Sapura",44 executed a contract for pipeline works known as the DomGas45 Pipeline Installation as part of the Gorgon Gas Project.4647 This was the first time Sapura sought to enter the


1 Australian maritime space. In May 2012, Sapura, like2 Saipem three and a half years earlier, faced a shortage of3 tugs and proposed to use foreign crew to overcome the4 shortfall. Even if domestic crew could be found, there was5 also an enormous potential saving to Sapura if it used6 foreign crew. Sapura's internal briefing documents7 estimated that the cost saving was in the order of8 20 per cent, or $AU2 million, to the costs of pipe9 transportation to the project.1011 In early May 2012, representatives of Sapura met with12 the MUA. The Commission will hear evidence from Mr Guido13 Bressani, the Chief Executive Officer of Sapura, that at14 that meeting the MUA took issue with the plans developed by15 Sapura in relation to pipe transportation. Mr Cain16 expressed dissatisfaction that Sapura was attempting to17 gain commercial benefit by using foreign-crewed tugs to the18 detriment of utilisation of Australian nationals and MUA19 members.2021 A short time after this, a breakfast meeting was held22 on 14 May 2012. Mr Bressani was in attendance on behalf of23 Sapura, together with Mr Di Giorgi, who by this time had24 left Saipem to become the Chief Operating Officer at25 Sapura. The MUA was represented by Mr Cain and another26 official at the MUA, Mr Will Tracey.2728 At the breakfast meeting, the parties agreed that29 Sapura would finance the training of four trainees through30 METL at a cost of $77,000 per trainee and also sponsor the31 MUA State Delegates' Conference to the tune of $50,000.32 Mr Bressani's evidence will be that Sapura agreed to the33 proposed sponsorship in return for an understanding with34 the MUA that it would support Sapura's project and35 specifically the use of foreign-crewed tugs by Sapura.3637 The next day, 15 May 2012, the MUA invoiced Sapura for38 $50,000 payable to a fund identified as the Fremantle39 Special Purpose Fund.4041 This fund is variously identified in the documents as42 the "Fremantle Special Purpose Fund" or the "Fighting43 Fund". It is a bank account of the MUA and its bank44 balance contributes to the total assets recorded in the45 MUA's accounts. It currently has net assets of46 $1.88 million. It derives 60 per cent of its income from47 donations. It is not a "fighting fund" in the sense of an


1 election fighting fund used for the re-election of union2 officials. Rather, it is a bank account of the MUA that is3 used in connection with the activities of the WA Branch of4 the MUA. It pays, for example, some of the general5 expenses of the Branch, including groceries and stationery.6 It also pays for the cost of conferences, such as the State7 MUA Delegates' Conference. The picture that emerges is8 that when companies pay into this fund, they are, in9 effect, subsidising the ordinary operating activities of10 the WA Branch of the MUA.1112 Dredging International and the 2012 Dredging Enterprise13 Agreement1415 The next case study is Dredging International16 (Australia) Pty Ltd. Unlike Saipem and Sapura, which were17 new entrants into the maritime space, Dredging18 International has run operations in Australia for decades.19 It was incorporated in 1973.2021 In 2009, Dredging International concluded a two-year22 Enterprise Agreement with the MUA. It was concluded around23 the time that METL was being established. Clause 4124 provided that Dredging International would enter into25 a memorandum of understanding with the MUA to provide26 contributions to METL consistent with the contributions27 made by other participants in the dredging industry. No28 separate agreement or understanding was reached between the29 MUA and Dredging International and it would appear that no30 payments were in fact made by Dredging International to31 METL pursuant to clause 41.3233 In 2012, in connection with negotiations for the next34 Enterprise Agreement, the MUA asserted that there had been35 non-compliance by Dredging International with training36 obligations under the 2009 Agreement. A compromise was37 reached. Clause 9 of the 2012 Agreement provided that38 Dredging International would pay a compulsory 1 per cent of39 its payroll to METL and that this amount would increase to40 4 per cent by the fourth year of the operation of the 201241 Agreement. This amount was in fact carved out of42 employees' pay increases. That is, the 2012 Agreement43 provided that, in effect, employees would forego some of44 the negotiated pay rise and Dredging International would45 deduct from its employees' salaries this proportion of46 their pay as a compulsory contribution to METL.47


1 However, METL was not the only beneficiary of the2 MUA's negotiating success. The 2012 Agreement was approved3 by the Fair Work Commission on 8 May 2012. The next day,4 MUA invoiced Dredging International for $200,000 payable to5 the Fremantle Special Purpose Fighting Fund. It was said6 that this money was for a four-year sponsorship of the7 WA Branch annual Delegates' Conference. The Commission8 will hear evidence from Mr Joris De Meulenaere that this9 payment and others like it to the Special Purpose Fund were10 made for - this is a quote from the evidence - "no11 appreciable benefit" to the company other than the12 "intangible benefit" of being seen to maintain a working13 relationship with the MUA.1415 Van Oord1617 The final case study concerns the company Van Oord18 Australia Pty Ltd. Van Oord is an international contractor19 for dredging, marine engineering and offshore energy20 projects. The Commission will hear evidence from21 Mr Martin Meijers. Mr Meijers is the Managing Director of22 Van Oord and is also a Director of METL. His evidence will23 address the payments made by Van Oord to METL, some of24 which relate to training of Van Oord employees. He will25 also give evidence of a substantial number of additional26 payments made by Van Oord to a training fund of the MUA.2728 In the period 2012 to February 2014, Van Oord agreed29 to sponsor the MUA's Training and Development Fund for30 $281,000. The Training and Development Fund is another31 bank account of the MUA. It was closed shortly after the32 announcement of the Royal Commission this year. Some but33 not all of its balance was transferred to METL. The34 remainder was paid to the Special Purpose Fund.3536 THE COMMISSIONER: Yes, thank you.3738 MR STOLJAR: Commissioner, the first witness is Mr Fabio39 Di Giorgi, but there are some appearances.4041 THE COMMISSIONER: Yes, Mr Crawshaw. You appear for the42 MUA?4344 MR S CRAWSHAW SC: Yes. I think we've had written45 authorisation to appear for the MUA. I also seek46 authorisation to appear for Mr Cain and Mr Crumlin.47


1 THE COMMISSIONER: Yes, you have that authorisation.23 MR CRAWSHAW: They're giving evidence today.45 THE COMMISSIONER: Yes.67 MR CRAWSHAW: After you've taken the appearances, I just8 want to say something about the breadth of the opening.910 THE COMMISSIONER: Yes. Are there any other appearances?1112 MR M COX: Your Honour, I appear for Mr Di Giorgi.1314 THE COMMISSIONER: Thank you.1516 MR N ELLERY: Your Honour, I appear for Mr Bressani.1718 THE COMMISSIONER: Very well.1920 MR A KOSTOPOULOS: May it please the Commission, my21 application is for authorisation to appear for Van Oord22 Australia and also Marinus Meijers.2324 THE COMMISSIONER: Yes, that authorisation is granted.2526 MR I NEIL SC: If it please the Commission, I appear with27 my learned friend Mr Gardiner to ask for authorisation to28 appear for Dredging International (Australia) Pty Ltd and29 Mr De Meulenaere.3031 THE COMMISSIONER: That too is granted.3233 MR W G McNALLY: If the Commission pleases, I seek leave34 to appear on behalf of Mr Simon Earle, who will be called35 as a witness today.3637 THE COMMISSIONER: Yes, Mr McNally, leave is granted.3839 Yes Mr Crawshaw?4041 MR CRAWSHAW: Mr Commissioner, what I wanted to say about42 the opening - and this applies to the proposed evidence43 also - is that it appears to me that it goes beyond the44 Terms of Reference of the Commission in that it is45 inquiring into, as my learned friend called them, bank46 accounts of the MUA. They are not separate entities to the47 MUA and therefore, in our submission, are not caught by the


1 Terms of Reference that refer to separate entities and2 relevant entities.34 In other words, my learned friend mentioned Term of5 Reference (d), the circumstances in which funds have been6 sought from any third parties and paid to relevant7 entities. That of course, we accept, applies to payments8 into METL, but it doesn't apply to payments into either of9 the MUA bank accounts that my learned friend mentioned.1011 Therefore, the only way those matters could come12 within the Terms of Reference is if they fell within (g)13 or (h), namely, breach of any law, regulation or14 professional standard by any officer of an employer15 association to procure advantage or cause detriment; or16 (h), bribe, secret commission or unlawful payment or17 benefit.1819 My friend, quite properly, didn't open that there was20 any conduct that fell within (g) or (h). Indeed, if you21 look at the proposed evidence, as we have, there is not22 a skerrick of evidence to suggest that there's any unlawful23 conduct, any bribe, any unlawful payments or unlawful24 benefits or anything of that nature. We come back to the25 fact that these bank accounts fall outside the Terms of26 Reference because they don't constitute such conduct and27 payments into them are not payments into relevant entities,28 because the relevant entities, of course, are the separate29 entities that are the focus of most of the Terms of30 Reference of the Royal Commission.3132 THE COMMISSIONER: What about the definition of "separate33 entity"? Do you have the Terms of Reference there? It34 appears on a page numbered 4 in my copy.3536 MR CRAWSHAW: Yes. It has to be --3738 THE COMMISSIONER: You're now on paragraph (c)?3940 MR CRAWSHAW: Yes. Accepting that they could fall within41 (a) or (b), we say it is not a separate legal entity. As42 my learned friend quite properly said, they're bank43 accounts of the MUA.4445 THE COMMISSIONER: Yes. Mr Stoljar?4647 MR STOLJAR: Two points - first, there's quite a deal of


1 evidence about money travelling to or from these accounts2 to METL. METL is a relevant entity and, in those3 circumstances, the operation of these funds is relevant to4 and associated with the activities of METL and thereby5 a proper subject of the Terms of Reference. That's the6 first point.78 The second point is my friend correctly directed your9 attention, Commissioner, to Terms of Reference (g) and (h).10 I haven't used the language appearing in the first part of11 (h) in the opening. However, I will be taking you to12 correspondence, Commissioner in which that language was13 used.1415 In any event, (g) and (h), particularly H, are in16 broad terms. It would extend to, for example, procuring17 money for one purpose and using it for another. I referred18 a number of times in the opening to seeking money on the19 face of it for training or development but in truth seeking20 it for procuring industrial peace.2122 If that is the case - and I said that in opening on23 several occasions - then that conduct is caught by (g) or24 (h) and is conduct which properly falls within the Terms of25 Reference. That's the second and standalone basis on which26 the evidence today is within the Terms of Reference,27 Commissioner.2829 THE COMMISSIONER: Is there anything further you want to30 say Mr Crawshaw?3132 MR CRAWSHAW: Yes, Commissioner. We don't object to33 evidence being called about moneys coming from either of34 those funds and going into METL. That's the first matter35 my learned friend addressed. METL is a separate entity.36 That doesn't justify a total inquiry into the whole of the37 bank account because funds come from there. That's not38 incidental or reasonably incidental to the payment from the39 account into METL. My learned friend says "quite a few40 payments". On my reading of the evidence, it is just41 a one-off payment that was made from those accounts into42 METL. Of course, that comes within the Terms of Reference.4344 My learned friend now resorts to (g) and (h).45 "Procuring industrial peace" does not, we suggest, set out46 any case for there being a bribe, a secret commission or an47 unlawful payment or benefit. Those Terms of Reference all


1 go to illegal and unlawful acts, and there's not a skerrick2 in this proposed evidence - and we've seen it all - to3 suggest that the MUA has been involved in anything illegal4 or unlawful. The idea that procuring industrial peace has5 occurred suggests that there was a threat of industrial6 war. You won't find that in any of the proposed evidence.78 THE COMMISSIONER: Yes. I think the way to proceed is9 simply to take the evidence in, and if at the end of the10 evidence it seems that there are chunks of factual material11 that are outside the Terms of Reference, that can be raised12 in final address, so that if the submissions are valid, the13 Commission can steer away from dealing with those topics.14 I think it may just be a little hard to cut it up into15 neatly assigned slices at the moment, Mr Crawshaw, but16 I understand and your point is, of course, noted.1718 MR CRAWSHAW: This affects all the proposed evidence.19 I won't jump up with each witness and make the objection,20 because you will understand I'm making a general objection21 to all those.2223 THE COMMISSIONER: As they say, you're protected.2425 Yes, Mr Stoljar?2627 MR STOLJAR: The first witness is Mr Di Giorgi.2829 <FABIO DI GIORGI, affirmed: [10.26am]3031 <EXAMINATION BY MR STOLJAR:3233 MR STOLJAR: Q. Could you tell the Commission your full34 name?35 A. Fabio Di Giorgi.3637 Q. You're a resident of New South Wales?38 A. Sorry?3940 Q. Are you a resident of New South Wales?41 A. No, I'm a resident in Western Australia.4243 Q. I'm sorry, Western Australia. What's your current44 position, Mr Di Giorgi?45 A. I'm Chief Operating Officer of SapuraKencana46 Australia.47

.29/09/2014 11 F DI GIORGI (Mr Stoljar)Transcript produced by Merrill Corporation

1 Q. You've prepared a witness statement dated 26 September2 2014?3 A. Yes.45 Q. Do you have a copy of that with you?6 A. Yes, I have.78 Q. Is the content of that statement true and correct?9 A. I have one correction; that's two points.1011 Q. Yes, what's your correction?12 A. So item 11. Instead of "CFMEU", it is actually13 "AMWU".1415 Q. BMWU?16 A. AM - Australian --1718 THE COMMISSIONER: Q. AMWU?19 A. AM. And the same for item 39. Sorry about that.2021 MR STOLJAR: Q. I'm sorry, the same for item?22 A. Item 39.2324 Q. Did you wish to make any other corrections?25 A. No.2627 Q. Save for those two matters, the content of your28 statement is true and correct?29 A. Correct, yes.3031 MR STOLJAR: Commissioner, I would ask that Mr Di Giorgi's32 statement be received into evidence.3334 THE COMMISSIONER: Yes, that will be received into35 evidence, together with FDG1.3637 MR STOLJAR: I appear to have, Commissioner, the original38 of that statement, which I will provide for the39 Commission's records.4041 #STATEMENT OF FABIO DI GIORGI DATED 26/09/2014, TOGETHER42 WITH FDG14344 MR STOLJAR: Q. Mr Di Giorgi, can I direct you to45 paragraph 4 of your statement. Can you just tell us a bit46 more about Saipem; what does it do?47 A. Saipem is today an EPCI contractor, which means that


1 they provide the full package from engineering up to2 fabrication, installation and commissioning of platforms,3 of pipelines and other activity related to this.45 Q. Maritime activities?6 A. Including a lot of maritime activity as well. So it7 was both onshore and offshore, actually, yes.89 Q. In connection with this project, the Blacktip Project,10 Saipem's principal was ENI?11 A. Correct.1213 Q. Can you tell us a bit more about ENI?14 A. ENI is another company and owns 40 per cent of15 Saipem - I'm not sure whether it is still 40, but at the16 time it was 40 per cent - and has interests all around the17 world, including Australia, and was developing the Blacktip18 field.1920 Q. The Blacktip field?21 A. Yes.2223 Q. You were project manager for the Blacktip field?24 A. I was the project manager for Saipem.2526 Q. You mention in paragraph 13 Mr Legrand. He reported27 to you, as you say?28 A. Yes.2930 Q. You've mentioned also Mr Lansbury in paragraph 17.31 What was his role?32 A. He was a consultant specifically for IR matters and --3334 Q. He was assisting Mr Legrand, was he?35 A. Yes.3637 Q. But he was retained by Saipem, was he, or his company38 was retained by Saipem?39 A. His fees were paid by Saipem, yes.4041 Q. In paragraph 19, you say:4243 Antoine Legrand reported that the MUA had44 advised that MUA workers on the Blacktip45 Project were against the idea of using46 foreign crews and vessels, but the MUA had47 suggested that additional training of


1 Australian maritime workers may be2 a solution.34 Do you know who at the MUA suggested that?5 A. I think that was a meeting with Chris Cain and others6 from MUA.78 Q. You weren't there yourself?9 A. I wasn't, no.1011 Q. Just to understand, did Saipem have employees in12 Australia other than yourself and Mr Legrand?13 A. Yes. Yes, we had.1415 Q. Were its employees members of the MUA?16 A. No.1718 Q. I take it from that it didn't have an EBA with the19 MUA?20 A. No, I don't think so.2122 Q. Just for completeness, I take it that ENI didn't have23 an EBA with the MUA?24 A. I don't think so.2526 Q. In paragraph 21, you say:2728 The training was also a gesture of good29 faith towards the maritime employees ...3031 Then you say "to calm them down". What do you mean by32 that?33 A. What we knew from what was reported to us is that the34 crew on board was not accepting the fact that our plan was35 to use foreign tugs to transport pipes to the vessel.3637 Q. Well, foreign crews on tugs?38 A. And foreign crews as well, so both, foreign tugs and39 foreign crews.4041 Q. Which vessel are you talking about there?42 A. There was a main vessel, that is the pipe layer, the43 Castoro Otto, and then there were approximately 9 to 1244 support vessels that were used to transport materials and45 pipes to the Castoro Otto.4647 Q. In paragraph 22, you refer to discussions between


1 Mr Legrand and the MUA. You say:23 I also took part from time to time ...45 Then just looking at paragraph 22, you say:67 In those discussions with Chris Cain, he8 told me a number of times ...910 You mean he, Mr Cain, told you a number of times?11 A. I think it was Antoine.1213 Q. Oh, Antoine?14 A. Sorry, yes.1516 Q. So Antoine told you a number of times that Australian17 maritime employees would not work with foreign --18 A. I would say both of them, yes.1920 Q. You were there as well?21 A. Yes.2223 Q. Is that what you're saying?24 A. "He" is referring to Antoine.2526 Q. "He", okay.27 A. Yes.2829 Q. But you were present at some of those discussions?30 A. I was present at some of the discussions, yes.3132 Q. Did anyone say to you that Australian maritime workers33 would not work with foreign workers?34 A. Yes, I heard this from Chris Cain.3536 Q. Did he say what they might do - that is, what37 Australian maritime employees might do - if there were38 foreign workers?39 A. Yes. Disrupt the project.4041 Q. How do you disrupt a project?42 A. You slow down the project.4344 Q. By doing what?45 A. Working very slow or maybe not working at all,46 depending. It was not clear exactly what the definition of47 "disruption" was.


12 Q. I'm going to show you some documents.3 A. Yes.45 Q. These are documents, just so you understand,6 Mr Di Giorgi, which have been, for the most part, produced7 on notices to produce.89 MR STOLJAR: Commissioner, I might do this at the outset,10 so I don't overlook it. I tender a two-volume MUA tender11 bundle dated 29 September 2014.1213 THE COMMISSIONER: Yes. Subject to the rights of any14 legal representative to object to any part of those two15 volumes, they will be admitted as Di Giorgi MFI-1.1617 DI GIORGI MFI#1 TWO-VOLUME MUA TENDER BUNDLE DATED18 29/09/20141920 MR STOLJAR: Q. If you would go to tab 2 in volume 1,21 Mr Di Giorgi, could I take you to page 269.22 A. Yes.2324 Q. You should be looking at an email in about the middle25 of the page, 16 July 2008, sent by Mr Legrand to26 Ms Patterson. Pausing there, Ms Patterson is ENI?27 A. Yes.2829 Q. I don't suppose you remember her position, do you?30 A. HR, IR of ENI.3132 Q. You were copied in to that email?33 A. Yes.3435 Q. He says:3637 We have had the inspection of Castoro 8 ...3839 I think you called it "Castoro Otto" in your evidence.40 A. Yes.4142 Q. If you don't mind, I'll call it "Castoro 8".43 A. Yes, no problem.4445 Q. And:4647 We have had the inspection of


1 Castoro 8/meetings on board with MUA2 officials yesterday.34 Because we're not as familiar with the way this works as5 you are, Mr Di Giorgi, there are actual meetings on board6 the vessel, attended by the union and by representatives of7 --8 A. They're inspections.910 Q. Vessel inspections?11 A. Vessel inspections.1213 Q. Did you go yourself, by the way, or was that14 Mr Legrand?15 A. Sorry?1617 Q. Did you go yourself to that vessel inspection or was18 that Mr Legrand?19 A. No, it was Mr Legrand.2021 Q. He says:2223 Several claims were raised (Mainly 15%24 bonus, hardlying allowance, contribution to25 training fund ...); we should be able to26 finalise an MOU for our current project27 next week ...2829 Then he says:3031 As you are already aware, our client ...3233 That's ENI, I take it; is that right?34 A. Yes.3536 Q.37 ... is ready to pay some of the claims to38 close the issues. As we agreed, we39 clarified that these engagements were only40 taken for the current project ...4142 That's the Blacktip Project?43 A. 16 July 2008. Let me think. Yes, I think - let me44 think. It could be - because the vessel was coming, the45 Castoro 8 was coming, for another project before Blacktip.46 That is the Montara Project. So I don't remember whether47 the inspection for both projects was combined and this was


1 the meeting - this was the - it could be for Montara or for2 Blacktip, but - yes.34 Q. I will take you to --5 A. Because Antoine was IR for both projects. No, sorry,6 it's to ENI. It must be ENI. The email was sent to ENI.7 Sorry, for ENI.89 Q. It was for ENI, so it's Blacktip?10 A. Yes, it must be for Blacktip. Sorry.1112 Q. The other project wasn't ENI?13 A. No.1415 Q. He says the engagement is maintained for the current16 project, which is Blacktip:1718 ... but it is obvious that this creates19 a precedent. To summarise situation on20 board, works are going well but maritime21 crew is creating a lot of technical22 issues ...2324 Do you know what he meant by that?25 A. I believe that is on the condition of the vessel, yes.2627 Q. Then he says:2829 What is positive is that construction30 unions didn't want to get involved in this.31 We'll meet them after the meeting with MUA32 next week to finalise the training33 contribution.3435 Then if you go to the next page, a file note of a meeting36 in Sydney on 15 August, so it is a few weeks later. This37 relates to the Blacktip Project. Mr Lansbury is at that38 meeting, who is the consultant to Saipem that you referred39 to earlier, and Mr Legrand?40 A. Yes.4142 Q. You weren't in attendance yourself. Did you review43 the file note at some stage?44 A. 15 August, I was on leave in Italy. Or I was back45 from Italy in that period, I remember, yes. I was only for46 one month from approximately - or less than one month, 20,47 20-odd days, 25 days from July, so --


12 Q. Under the heading "Briefing presentation", there's3 a reference to a document achieving its purpose by bringing4 an initial reaction to highlighting the need to use5 foreign-crewed spot hire tow tugs?6 A. Yes.78 Q. Then in about the fifth paragraph under that heading,9 it says:1011 ... there was a grudging acceptance by the12 unions that there may well be a short13 supply of spot hire vessels and Australian14 crews.1516 If you were on leave at about this time, I won't take you17 through this in detail, but that's at one of the early18 meetings. Then why don't you come through to page 272?19 A. 272, you say?2021 Q. Yes. This was a letter addressed to Mr Legrand, but22 is it one that you saw as well?23 A. I'm sure that I've seen it, yes, I saw it.2425 Q. You can see from the next page it is signed by26 Mr Crumlin, and Mr Cain is copied in?27 A. Yes.2829 Q. This is shortly after METL, that is the Maritime30 Employee Training Limited company, has been set up. The31 MUA says in about the third paragraph:3233 One initiative that is at a relatively34 advanced stage is the establishment of an35 industry managed maritime training company36 to receive and disburse funds for industry37 training.3839 Then it says a bit further down the page that the training40 levy contribution that's being discussed with the WA Branch41 will be directed to Maritime Employees Training Limited.42 Was that your understanding at that time or do you not43 remember specifically?44 A. I can't remember specifically, but it is the same as45 this one, yes.4647 Q. Could you come through to page 274. It is a meeting


1 in Fremantle on 25 August. Again, you're not there2 yourself. Mr Legrand is there for Saipem, and Mr Lansbury.3 Was Mr Legrand reporting back to you, by the way, about the4 progress of his negotiations?5 A. He was reporting to me, yes.67 Q. You can see the note records at that meeting - under8 the heading "Briefing Document", it says vessels are9 available and crew as well. And really spelt out in the10 final dot point, this is the response from the MUA:1112 Their immediate concern is the foreign crew13 tug bringing the empty barges to AMC14 facility "onto their patch" & that such15 situation could create a massive issue.1617 At this point, the tugs were bringing in some barges; is18 that right?19 A. Yes, this was onshore in the AMC facility, so there20 was an empty barge that was going to pick up, yes,21 equipment to be dispersed offshore.2223 Q. You were being told that such a situation could create24 a massive incident. Does that accord with your25 recollection?26 A. Yes.2728 Q. Did anyone spell out to you what the massive issue29 would be, what would actually happen?30 A. Possibility of strike, possibility of worker31 disruption.3233 Q. And then at page 275, there's reference to a letter34 that the MUA will provide. That may well be the letter35 that we looked at at page 272. Then it is said at page 27536 that Saipem undertook to brief ENI on the training claim.37 The next day, if you come to page 276 --38 A. Yes.3940 Q. -- there's a meeting between Saipem and ENI in Perth41 and you did attend at that meeting?42 A. Yes.4344 Q. And Mr Guaita from ENI and Ms Patterson came. So some45 people have come in from ENI and a number of46 representatives of Saipem and Mr Lansbury as well. Union47 not present here. This was just to brief ENI, is that


1 right?2 A. It was a project meeting.34 Q. It says:56 ... plenty of discussion on this topic7 including the various options available8 including legal remedies should the MUA9 disrupt the AMC Facility over the delivery10 of two barges by foreign crewed tugs.11 Saipem informed the meeting that there was12 little chance of the MUA backing away from13 their claim that Australians should crew14 these two tugs.1516 Had you actually briefed lawyers or the like at that stage?17 A. We briefed lawyers at the beginning of the project -18 lawyers were briefed probably at the beginning of the19 project, so we had a kind of strategy in place in case20 these things - for the better.2122 Q. Had you raised with the lawyers the question of what23 you could do if the MUA sought to disrupt the AMC facility?24 A. I'm sure it was, yes.2526 Q. Then the notes record that there was further27 discussion and, in the second dot point, the fourth line,28 they were going to continue to push the foreign crew issue,29 and then there's a paragraph beginning:3031 The Saipem made the following32 recommendation ...3334 Would you have been the person speaking on behalf of35 Saipem, you as the project manager?36 A. I think at this stage it was Antoine, because he was37 specifically - everything related to IR was managed and he38 was the person who was 100 per cent --3940 Q. They say:4142 The foreign crew tug currently in transit43 towing Barge 1 to the AMC facility should44 be diverted ... The point where the barge45 will be picked was discussed and Saipem46 made it clear they would prefer outside47 Australian waters ...


12 Barge 2 tug should also be crewed by3 Australians.45 Just go back to page 276. Those were recommendations that6 you or Mr Legrand were making on behalf of Saipem?7 A. Yes.89 Q. You have told us what was being talked about, possible10 disruption. Are you able to give an estimate of what it11 would actually cost Saipem or ENI if they had problems12 bringing those barges in, barges 1 and 2?13 A. Specifically, these barges were required to load the14 equipment that was required offshore, so any day of delay15 would have caused a delay of the vessel, of the pipe layer16 offshore, which means the cost of the spread offshore was17 in the region of $1 million per day. So every day was18 $1 million lost.1920 Q. I'm just trying to get a sense of how this works.21 Where exactly is the AMC facility?22 A. It is not too far from Perth, onshore, not far from23 Perth, yes.2425 Q. So equipment was going to come from Fremantle, do you26 mean?27 A. We basically built the top side and the jacket in28 Australia, not far from Fremantle, and then there were -29 and this is where AMC is.3031 Q. The barge is going to take that equipment all the way32 up to the Blacktip Project?33 A. Correct.3435 Q. Up near Darwin, effectively?36 A. Yes.3738 Q. I won't take you through every detail, but on39 page 277, in conclusion, ENI tells you they want to meet40 prior to the next meeting to give instructions. Then a few41 days later - go to page 278 - there's another meeting in42 Fremantle. The purpose is to continue negotiating issues43 raised by the MUA relating to foreign-crewed tugs,44 hardlying and training, Mr Cain, Mr Legrand, et cetera.4546 In short the MUA remain steadfast in their47 rejection of any foreign-crewed vessels ...


12 MUA also stated they did not as a rule3 accept bridle transfers offshore.45 Could you just explain what that is?6 A. So one of the options was to transport the barge up to7 outside the Australian waters and then send, outside8 Australian waters, an Australian tug and pick up basically9 the barge. The bridle is the connection, so the bridle10 from a foreign tug to an Australian tug.1112 Q.13 ... MUA again made it clear that they would14 not accept foreign tugs entering AMC or15 Darwin and if this did happen they would16 take action to disrupt the Project supply17 chain and activities on the Project site.1819 Then in that paragraph beginning "At the conclusion of20 these discussions", it says:2122 ... the MUA accepted that there may have to23 be transfers at see ...2425 That should be "sea", S-E-A, out in the ocean?26 A. Yes.2728 Q. Come over to the next page. There were really now29 discussions beginning to take shape about how much money30 would have to be paid to resolve this issue. The MUA31 wanted additional money to the training fund equalling the32 difference between bringing down a foreign tug rather than33 an Australian one. Bringing a foreign tug is cheaper,34 I suppose. You pay the foreign crew less; is that the35 short point?36 A. Absolutely.3738 Q. The difference between what you pay the foreign crew39 and what you pay the Australian crew - that was rejected.40 But at the conclusion, it says:4142 The willingness to close the deal is43 certain ... Negotiations will certainly be44 between 200,000 AUD and the current45 1,830,000.4647 So $1.8 million was what MUA was looking for, was it?


1 A. I think so, yes.23 Q. At the next page, there is some more discussion about4 that. Could we come through to page 284. This is an email5 from ENI to Saipem, to your attention. It is from6 Mr Guaita. Skim through the whole thing if you need to,7 but what he's essentially saying in the fourth paragraph is8 that ENI is amenable to make provision for a sum of money9 to assist in the provision of training, but there were10 certain conditions that ENI wanted. These are set out11 beginning at paragraph 1. ENI recognises - this is12 paragraph 2 - the skills shortage. It is not unreasonable13 to provide support for training. Paragraph 3:1415 ENI also wishes Saipem to get the point16 across that while there will be17 a longer-term benefit ... ENI will not18 directly benefit in any way from any such19 initiative.2021 And then at paragraph 5, they say:2223 ENI also requires Saipem to make clear the24 position that agreement from ENI to make25 any such payment is contingent upon the MUA26 agreeing to allow the nominated foreign27 crewed vessels to deliver materials ...2829 They say, on that basis, they are prepared to allow an30 amount of $200,000. So that was the starting point; is31 that right?32 A. The starting point.3334 Q. Then we come to page 287. This was a meeting just35 between Mr Cain and Mr Legrand. I'm not going to take you36 through this in detail, but at page 288, MUA wants37 $1 million; Saipem explains "only ready to pay $750,000".38 So the negotiations were continuing as to how much to pay.39 By the way, if you come back to page 287, it says:4041 MUA claims that they know that some tugs42 are available currently. Saipem explains43 again that there isn't.4445 Could you explain that? What was going on there?46 A. I think this was, again, a negotiation game. We had47 already - at that time we had already committed all the


1 tugs, which means we already paid, we could not escape, so2 at the time we couldn't change from foreign tug to3 Australian tug for economical reasons. So MUA was pushing4 to use Australian tugs.56 Q. Could you come through to page 290. It is a further7 letter from ENI to yourself. In the third paragraph,8 you've now got authority to go up to $750,000, and there9 are more conditions. The first one is that:1011 MUA agrees to allow [Saipem] to deliver all12 remaining line pipe and equipment barges to13 a point near Australian waters where14 a hand-over to Australian crewed tugs can15 occur for delivery to the [Castoro 8].1617 I want to direct your attention in particular to some of18 the conditions on the next page. At number 7:1920 MUA agrees that the funds will be paid in21 2 equal instalments, one at the beginning22 of the Project ... and a final instalment23 at the project completion.2425 ENI was seeking MUA's agreement to work cooperatively and26 positively with the contractor. And then 9 - this is what27 ENI wanted:2829 MUA agrees that Company [Saipem] may30 withhold the final instalment if the31 Project is impacted negatively due to32 actions by MUA officials or any MUA members33 involved with the Project.3435 By "impacted negatively", what do you understand that to36 mean?37 A. Disrupting the project.3839 Q. By industrial unrest?40 A. Yes.4142 Q. The payment of the final instalment - whatever that43 might be would depend on the final dollar figure reached -44 was conditional on there being no such unrest; is that what45 you're saying?46 A. That was the ENI position.47


1 Q. That was what?2 A. This was the ENI position, so what they wanted.34 Q. That's the position they're putting to you; is that5 right?6 A. Yes.78 Q. And you were going into the negotiations with that as9 your instruction?10 A. I think that we tried to avoid the negotiation with11 this specific point with the union, because it was clear12 from the beginning that the money was for training.1314 Q. We will come back to that.15 A. Yes.1617 Q. That was the position being communicated to you by18 ENI?19 A. Yes.2021 Q. Can you come through to page 292. This is an email22 from Mr Legrand to Ms Patterson and others, including23 Mr Stephen Walton. What was Mr Walton's position?24 A. He was another IR consultant of ENI.2526 Q. He worked for ENI --27 A. Yes.2829 Q. -- or was he a consultant? He worked for ENI?30 A. Yes.3132 Q. But in IR. So Mr Legrand is reporting on another33 vessel inspection. If you would just skim through it for34 yourself, I want you to stop at the paragraph beginning35 "On board":3637 ... at the attention to all the crew, and38 again during the meeting with us and the39 delegates, the MUA clearly stated that,40 considering all the efforts, the41 transparency and the approach of Saipem,42 the employees must work hard to deliver43 this project on time and stop "the44 bullshit".4546 What was being referred to there, do you know?47 A. Let me read it again, sorry.


12 Q. Of course.3 A. Okay, so this was a meeting on board with Chris Cain4 and Antoine. I think that this was the message that5 Chris Cain sent to their members on board the vessel to6 stop creating issues or disrupting the project.78 Q. That description of what was being done was something9 that Mr Cain came up with, is it, to your knowledge?10 A. Can you repeat, sorry?1112 Q. I won't take that any further. Don't worry. Can we13 then come through to page 294, a further meeting. Again,14 that's between MUA and Saipem. If you come over to15 page 295, it is reported that Mr Cain was angry about the16 hold-up. The second paragraph says:1718 After a break the meeting resumed ...1920 In effect, it's described as tense. It says that21 discussions got quite heated. Was that reported back to22 you, that discussions were getting heated at this point?23 A. I'm sure it was, yes.2425 Q. That was because no agreement had been reached about26 what was going to be paid?27 A. Yes, or there were delays on this, yes.2829 Q. Then on page 295, there is a paragraph beginning, "The30 following understandings were reached", a reference to MUA31 claiming a million, but the final dot point says:3233 Saipem/ENI to produce a side letter34 explaining the circumstances that have35 brought about the utilisation of foreign36 crewed tugs ...3738 If you go back to the penultimate dot point:3940 . There would be no mention of Training41 Levy in the MOU.4243 The last dot point:4445 . Saipem/ENI to produce a side letter ...4647 Why put it in a side letter? Why not put it in the MOU?


1 A. I don't know. Honestly, I don't know.23 Q. There's then a draft of the side letter on page 296,4 and then there's quite a few pages of documentation,5 Mr Di Giorgi, about the side letter and what's going to be6 paid. I won't take you through it all. Could I take you7 directly to page 313. We have now come through to October8 2008. Mr Legrand is reporting to Mr Guaita and you're9 copied in in an email?10 A. 303, yes.1112 Q. Page 313.13 A. 313, sorry. Yes.1415 Q. This was an email you received back in October 2008?16 A. Sorry, what was the question?1718 Q. You were cc'd into this email?19 A. Yes.2021 Q. So you received it back in October 2008?22 A. Absolutely, yes.2324 Q. Do you remember it?25 A. Yes, when I read it, yes, I remember - I remember this26 was the normal situation, yes. I can't remember27 specifically now this email, but I remember the facts.2829 Q. What do you mean it was the "normal situation"?30 A. Well, no, I mean, this was the discussion ongoing.3132 Q. But Mr Cain is recorded as being:3334 ... furious and completely pissed off. He35 spent the whole time [yelling] and36 screaming at Saipem/ENI. He threatened to37 shut down the whole job at several38 occasions ...3940 Do you remember that being reported to you or reading this?41 A. I remember, yes.4243 Q. Mr Legrand says:4445 Sparing to you the swearing, the insults,46 the confusion and the denial of the47 evidence, here is a brief description of


1 the mentioned topics:2 . He was demanding a meeting with ENI this3 afternoon, not even next week, otherwise4 the job will be shut down ...56 Is that a reference to the Blacktip Project?7 A. Yes.89 Q. Come down a few dot points, but read the whole thing10 if you need to:1112 "After having so much helped Saipem for the13 asbestos, the importation of C8, the bed14 bugs, Saipem is bringing foreign vessels15 and is doing everything to delay the money16 wired to the fund ...1718 Anyway, he was annoyed?19 A. Yes.2021 Q. Mr Legrand springs into action. On the next page,22 he's sending emails, to which you're copied in, saying:2324 ... we need to send ASAP the RFA ...2526 What's the RFA?27 A. Request for - sorry, I can't remember. It's request28 for --2930 THE COMMISSIONER: Q. Request for funds application?31 A. No - yes, it would --3233 MR STOLJAR: Yes, it may well be.3435 THE WITNESS: Yes, application for payment.3637 MR STOLJAR: Q. Miron is at Saipem, I take it?38 A. Miron was the cost controller.3940 Q. He's saying to Miron, "Look, we've got to quickly seek41 payment from ENI, asking for this $1 million - $500,000 now42 and $500,000 when it ends", and then:4344 As soon as the approval of the training45 fund constitution document and the letter46 are received from ENI ... Fabio -47


1 that's you -23 will confirm and we need to be able to make4 the first payment of half million.56 So you had, by this stage, arrived at the view that you7 were going to pay the $1 million?8 A. I assume so, yes.910 Q. Was that triggered in part by the anger that Mr Cain11 had demonstrated - in fact, yes, you can see Antoine has12 forwarded on the email containing his description of his13 conversation with Mr Cain. Did you make the decision on14 24 October 2008?15 A. I think it was agreed, it was agreed that we would16 contribute to the training for $1 million and --1718 Q. On that day?19 A. During all the previous - during the previous period,20 and so there was no reason to postpone that.2122 Q. Could you then come through to page 318. I'm just23 reminded, before we come to page 318, I'll just take you24 back to page 312 for a moment, Mr Di Giorgi.25 A. Yes - 312, you're saying?2627 Q. Page 312.28 A. Yes.2930 Q. It is an email from Mr Legrand to you.3132 THE COMMISSIONER: Request for award.3334 MR STOLJAR: Yes.3536 Q. It says:3738 ENI requested a "Request for award" ...3940 So that would be the RFA?41 A. Yes. It was - basically, for them to pay, they needed42 a document.4344 Q. Mr Legrand says:4546 I would suggest we prepare it soon to get47 an approval fast ... The advantages that


1 we'll get from this contribution ...23 That is this contribution of $1 million, I take it; is that4 right?5 A. Yes.67 Q. The advantages that Mr Legrand sets out are use of8 foreign tugs to deliver and re-collect pipe, et cetera; it9 drops down the hardlying claim from $200 to $30 per10 employee - is that right?11 A. Yes.1213 Q. It ensures pipe supply - that's pipe supply up to the14 Blacktip Project?15 A. Yes.1617 Q.18 Relations with the MUA are going well. If19 you see anything else ...2021 Did you write back to him with anything else?22 A. I can't remember.2324 Q. Can we take it that what Mr Legrand sets out are the25 advantages that both you and he could see with paying the26 $1 million?2728 MR CRAWSHAW: I object to that. The witness says he can't29 remember whether he wrote back, so there may have been30 other things that he can't remember.3132 THE COMMISSIONER: What's your question again? It was33 more open-ended than that.3435 MR STOLJAR: I said, "May we take it that what's set out36 in this email reflects the advantages that both you and37 Mr Legrand could see arising from the payment of the38 $1 million?"3940 MR CRAWSHAW: I further object on the basis that he can't41 give evidence on behalf Mr Legrand, anyway.4243 THE COMMISSIONER: That's a brilliant point. With that44 amendment, the question is just open-ended. It is not45 hanging off any further document that might or might not46 have been created that the witness can't remember.47


1 MR STOLJAR: No, I framed it in that way because --23 THE COMMISSIONER: I allow the question minus Mr Legrand.45 MR STOLJAR: I'll put it again without involving6 Mr Legrand.78 Q. Do the five dot points set out in the email reproduced9 on page 312 reflect the benefits which you could see10 flowing to Saipem and ENI as a consequence of the payment11 of the $1 million?12 A. Item 1, for sure. Item 1 - the first bullet. And I'm13 not sure for item 2. It probably was part of the14 negotiation to bring down also - the million was inclusive15 of this.1617 Q. Yes?18 A. But item 3 - yes.1920 Q. Yes?21 A. Item 4 is irrelevant for me because I didn't see any22 improvement on the relationship, actually, towards the end23 - on board. I'm saying on board.2425 Q. No, I'm not asking about what happened at the end.26 I'm saying on 22 October 2008, when you were thinking about27 whether to cause this payment to be made or not, one of the28 factors that you took into account was that relations with29 the MUA were going well; is that right?30 A. Probably, yes. Yes.3132 Q. You wanted to keep those relations going well;33 correct?34 A. For the benefit of the project, yes.3536 Q. If you come over to page 318, this is a letter that37 you sent on 28 October 2008. The reference number is38 0796-SAI-ENI-E. You say:3940 Dear Sir -4142 this is ENI -4344 Contractor recommends Company to effect45 a contribution of AUD 1,000,000 ...4647 Just glance through the rest of paragraph 1, and then you


1 say:23 This training contribution is intended to4 maintain the relationships established with5 the maritime unions and facilitate their6 cooperation to mitigate the risks with7 HSE/IR issues in relation to Blacktip8 Project activities ...910 Pausing there, "HSE" is health, safety and environment; is11 that right? Is that right, Mr Di Giorgi?12 A. Yes.1314 Q.15 ... to mitigate the risks with HSE/IR16 issues in relation to Blacktip Project17 activities (eg use of foreign tugs to18 deliver and re-collect pipe, material,19 topside, jacket and SPM barges to a point20 offshore ...2122 Then you say:2324 In view of the current pressure exerted by25 the maritime unions to receive this26 training contribution Contractor awaits27 Company's urgent agreement for this28 recommendation and payment of the specified29 amount to Contractor.3031 When you wrote this letter on 28 October 2008, that's what32 you saw as being achieved by the training contribution;33 correct? It would mitigate the risks with HSE/IR issues;34 is that right?35 A. It will calm down the people on board and, in a way,36 mitigate the disruptions for the project.3738 Q. It will calm them down because they'll stop raising39 industrial issues; is that right?40 A. Yes.4142 Q. Then Mr Walton, on the next page, 319, writes to43 Mr Guaita. I don't know whether you were forwarded this or44 not. I think you were at some stage, but anyway. This is45 a person at ENI to the head of ENI, or the relevant head.46 He says:47


1 The attached recommendation from Saipem is2 recommending ENI to pay the MUA training3 fund ...45 In the second paragraph:67 In addition the correspondence states the8 intention for the contribution as being "to9 maintain the relationships established with10 the maritime unions and to facilitate their11 cooperations to mitigate the risks with12 HSE/IR issues in relation to ..."1314 Then he says:1516 I think this sounds a little too much like17 a bribe. My understanding of the reason we18 are making this contribution is in19 recognition that there is a Shortage of20 Australian Seafarers and as such we have21 had to utilise foreign vessels on the22 project and therefore we are providing23 funds to the Maritime Industry to support24 the training of additional seafarers for25 the future?2627 I'm not sure how you want to deal with this28 issue - do you want to call Fabio and tell29 him to re-do his note or do you want to30 respond formally?3132 Now, someone did respond to you, I take it?33 A. I think he sent an email out.3435 Q. I see. So you received that in due course. In fact,36 if you come through to page 321, Mr Guaita sends yourself37 and Mr Legrand Mr Walton's email and he says:3839 The second comment is instead important to40 me.4142 That's the comment we were just talking about.4344 None of us has the interest in having45 correspondence that could be used to46 configure a case of bribing when the47 reality is definitely clear and honest.


12 Would you be able to reissue the letter ...34 Just come back to page 318 for the minute. Let's not worry5 about attaching labels to it in the way Mr Walton did, or6 legal conclusions, but what you had said in your letter at7 page 318 is exactly how you saw it on 28 October 2008,8 isn't it, that is to say, it would mitigate risks9 associated with HSE/IR issues; that's right, isn't it?10 A. Well, the problem is what was before. The fact that11 the payment was delayed was creating a bit of discomfort on12 board. People on board probably came to know through13 Chris Cain, and we were trying to expedite this payment.1415 Q. But you were concerned to mitigate risks associated16 with HSE and IR issues; that's right, isn't it?17 A. That was my concern, as a concern of any project18 manager, yes, in Australia.1920 Q. Come through to page 323. Mr Legrand writes to you.21 This is an email that now is just between yourself and22 Mr Legrand. He says:2324 The reason below that Steve mentions is25 correct ... "Shortage of Australian26 Sea Farers and as such we have had to27 utilise foreign vessels ...2829 Et cetera. He adds:3031 For me we can re-draft our letter instead32 of having: "to maintain the relationships33 established with the maritime unions ...3435 Et cetera. He's suggesting to redraft your original36 letter. Then come through to page 325.37 A. Can I add one thing before we go there?3839 Q. Yes, please.40 A. Of course, this is a statement of one person and it is41 his statement. I never believed that this was a bribe.42 I want to confirm this.4344 Q. Thank you. Yes, all right. Can you come through to45 page 325.46 A. Sorry, 325, do you say?47


1 Q. Yes. The Project Secretary stays:23 Dear Sir -45 this is to Mr Guaita -67 Please disregard the previous communication8 with the same number. Here is the9 communication with attachments ...1011 A. Yes.1213 Q. The redraft that you've come up with is at page 327.14 This is now 3 November, but if you flick between pages 32715 and 318 for the minute, it has the same reference number,16 0796-SAI-ENI-E. Version one on page 318 says that the17 contractor recommends the company do certain things. Now18 on page 327, the contractor intends to effect19 a contribution of $1 million. The certificates of20 incorporation and constitution are enclosed. Then you say:2122 Contractor advises that the Fund23 Constitution is currently being revised ...2425 The wording you've come up with is different. You wrote26 this letter yourself, did you, the one on 3 November 2008?27 A. I don't remember. Normally, letters were written by28 Antoine or by our legals.2930 Q. You signed off on it?31 A. Yes.3233 Q. You satisfied yourself it was correct before you34 signed it?35 A. I need to - I need - I was, yes.3637 Q. So whoever has drafted the words you'd satisfied38 yourself were correct says:3940 This training contribution is intended to41 sustain the training of new and existing42 Employee, in relation to future projects in43 Australia, at Company's benefit as well.4445 Just pausing there, you haven't used the words along the46 lines that Mr Walton suggested, have you?47 A. I don't think so, no. I don't remember what it was he


1 suggested.23 Q. He's really talking about - page 319, for example.4 A. Yes.56 Q. You don't, for example, talk about recognising there's7 a shortage of Australian seafarers and the like.8 A. Yes, correct, I didn't.910 Q. If you come back to page 327, you've said:1112 This training contribution is intended to13 sustain the training of new and existing14 Employee ...1516 Employees of who?17 A. Which employees, is the question?1819 Q. Employees of who? You say "the training of new and20 existing Employee"?21 A. We are talking - we're probably referring to the crew22 on board.2324 Q. They're not your employees, are they?25 A. You're right, yes, they're not our employees.26 Actually, they are, they are, because we paid them.2728 Q. I'm sorry, who are you talking about "on board"? Do29 you mean the foreign crews on the tugs?30 A. No, no, I'm talking about the crew on board the31 vessel, so the Australian crew on board the vessel.3233 Q. On the Castoro 8?34 A. Of any vessel working in the field. There were35 12 vessels probably overall.3637 Q. But they're not Saipem's employees, are they?38 A. They are not Saipem employees because we were using39 many agents, but officially they - okay. I think it's a40 technicality, yes. I agree, they're not directly, yes, our41 employees.4243 Q.44 ... in relation to future projects in45 Australia, at Company's benefit ...4647 That means, what, at ENI's benefit?


1 A. ENI, yes.23 Q. What were the future projects you had in mind?4 A. Well, Saipem had a lot of targets in Australia.5 Currently, Saipem is in Australia working for the longest6 pipeline ever, so there were a lot of projects in the7 pipeline for Saipem in Australia and there are a lot of8 projects.910 Q. But not necessarily with ENI?11 A. With ENI - ENI has also, I assume, project targets in12 Australia.1314 Q. Do I take it from that answer that you had no15 particular projects in mind when you wrote this letter?16 A. For Saipem it was a group strategy, so IR was - any17 decision that would have affected the future of IR was18 taken at a group level.1920 Q. My question was do I take it that you had no21 particular projects in mind when you wrote this letter?22 Are you able to answer that question?23 A. I don't remember, but I remember at this stage we were24 tendering for a lot of projects.2526 Q. Really, the position was you just wanted to get the27 Blacktip Project done as quickly and as cheaply as28 possible?29 A. Yes.3031 Q. You didn't want to get interrupted by a lot of IR32 disputes and the like?33 A. Correct.3435 Q. You thought that you were going to be interrupted if36 you didn't make this payment?37 A. Correct.3839 Q. The best way of achieving a prompt and quick and40 efficient and expeditious project was to just make the41 payment of $1 million; that's right, isn't it?42 A. Was to maintain the words with the unions.4344 Q. Maintain the what?45 A. Maintains the words, what we agreed, so to train46 people.47


1 Q. Are you saying maintain your word?2 A. The "words" means the agreement done.34 Q. Yes, quite so, but what you were trying to achieve by5 the making of that agreement was industrial peace; that's6 right, isn't it?7 A. It was to calm down the people on board the vessel.89 Q. And by calming them down you mean achieve industrial10 peace, because they're calmed down; that's right, isn't it?11 A. By "calm down", I intend, yes, no disruption, no12 disruption for the project.1314 Q. Well, no disruption is just another way of saying15 industrial peace; that's right, isn't it?16 A. I'm not 100 per cent sure, but probably, yes.1718 Q. Could you come through to page 351. Mr Legrand is19 writing to a number of persons, including yourself. He20 says Mr Cain is upset because you were "trying to fix21 things with Paddi". Now, had you or Saipem gone off and22 engaged in some negotiations with Mr Crumlin?23 A. Sorry, can you repeat the question?2425 Q. Had Saipem or ENI gone off and engaged in some26 negotiations with Mr Crumlin, Paddy Crumlin, or do you not27 remember?28 A. I know that there were - that there were different29 meetings in Sydney, so that Antoine met Paddy, and I think30 I met, as well, Paddy once.3132 Q. Mr Cain is saying to you, in the third paragraph,33 "Don't care", in effect, "what you do with Paddi. I am34 going to shut down this job; you'll see what happens on35 this rig." By that, you understood him to mean the36 Blacktip Project?37 A. Yes.3839 Q. Then come through to page 354. By this stage, there's40 an escrow deed in contemplation. I think it was signed41 a short time later. In the bottom main paragraph of that42 email from Mr Legrand, he says:4344 Chris Cain mentioned he will want to go to45 C8 [Castoro 8] but we agreed to wait for46 the money to be in the Escrow.47


1 Then the italics is Mr Legrand's observations:23 The sooner it will be, the fewer risks we4 take to have a problem offshore.56 By "problem", he meant an IR problem?7 A. Our intended disruption, yes.89 Q. Disruption?10 A. Yes.1112 Q. What's the connection between the disruption and13 paying the money, that is, paying the first instalment for14 the training fund?15 A. Because I think that at that stage, because the16 agreement was delayed, delayed and delayed, the people on17 board were receiving a message from onshore that we didn't18 want to fund any more this training, and this was causing -19 could have caused an issue, IR issue.2021 Q. Mr Legrand was suggesting that the sooner the money22 was paid, the less risk there would be of industrial23 relations disruption?24 A. Yes, because it was a clear message that, yes, we25 maintain what we agreed.2627 Q. Could you come back to your statement for a minute.28 A. Yes.2930 Q. In paragraph 25, you say the purpose of paying for31 industrial training was to address the skills shortage and32 calm down the workforce. The real purpose was calming down33 the workforce; that's right, isn't it?34 A. That was also a real issue of skills shortage, sure.3536 Q. In paragraphs 27 and 28, you're saying that the37 $1 million was to be paid in two tranches. You say at38 paragraph 28 that it was important to manage cashflow.39 But that wasn't the real issue, was it, the real reason for40 breaking it up?41 A. It was one of the issues. I can't exactly - I think42 at the beginning, the union - Chris Cain wanted only one43 tranche, and we of course tried to split it into two44 tranches because it was, yes, a kind of cashflow issue as45 well.4647 Q. The real point is that he wanted to have something to


1 hold over the MUA in the event of any disruption; that's2 right, isn't it?3 A. No. No, this was not the purpose of this meeting.45 Q. I'm sorry?6 A. No. I disagree, sorry.78 Q. That was discussed, wasn't it - you needed to have9 some leverage?10 A. That was what ENI wanted, but this is not what we11 wanted. This was what Paolo Guaita wanted. We clearly say12 this is not the purpose of this meeting, and I think - yes,13 sorry, go ahead.1415 Q. It's not quite as simple as that, is it, Mr Di Giorgi?16 I'll take you back to some of the documents. Come to17 page 366.18 A. 366?1920 Q. Yes. On 27 January 2009, Mr Guaita sends an email to21 you, and he says in the second paragraph:2223 ... contractor has established with the MUA24 an Escrow Deed ...2526 That, in effect, allows for two tranches, two lots of27 $500,000, one at the end and one at the beginning. Then he28 says:2930 Company does not agree with the contents of31 Contractor correspondence ...3233 And he gives a reference. Then the third dot point:3435 Company reminds Contractor as previously36 advised ... that Company may withhold the37 final instalment if the Project is impacted38 negatively due to actions by MUA officials39 or any MUA members involved with the40 Project.4142 I take your point that you're saying this is what ENI is43 saying to you?44 A. Yes. I remember very well this, yes.4546 Q. ENI is saying to you, "If there's any industrial47 unrest" - this is how you understood it - "we don't want to


1 have to pay that last $500,000"?2 A. This was what Paolo Guaita wanted, yes.34 Q. That of course is, in effect, exactly what you'd5 said - I'll put it in different words, but it is the same6 basic point that you were making back on page 318?7 A. Page 318.89 Q. Yes, go back to page 318. The way you put it was:1011 The training contribution is intended to12 maintain the relationships established with13 the maritime unions and facilitate their14 cooperation to mitigate the risks with15 HSE/IR issues ...1617 We've looked at that. Then on the next page, 319, ENI18 says, "Oh, that looks too much like a bribe." So you then19 reword it in the way we've looked at. Then we come through20 to January 2009, early the next year, and ENI is saying to21 you:2223 Company reminds Contractor as previously24 advised ... that Company may withhold the25 final instalment if the Project is impacted26 negatively due to actions by MUA officials27 or any MUA members involved with the28 Project.2930 Now they're suddenly telling you, "We want that as an31 express part of the agreement, that we can withhold that32 last $500,000", and you had changed your letter earlier to33 water down that aspect of the matter; that's right, isn't34 it?35 A. No, we totally disagreed with this statement.36 I remember we totally disagreed with this statement. We37 totally - and we discussed with Paolo the purpose of this38 is for training. We can't use this for any other reason.3940 Q. Come to page 368. I think this is where you're41 saying, "We disagree." Saipem writes back and says:4243 ... Company was kept fully updated ...4445 The very next day, you send this. This is 28 January. And46 you send him every document along the way. You must have47 been pretty concerned about what was now being put; is that


1 right?2 A. Yes, we were very - I remember this very well. We3 were very upset by this letter, because it was like ENI was4 just forgetting what was discussed up to that stage.56 Q. Because you didn't have anything in the escrow deed to7 that effect?8 A. Sorry?910 Q. You didn't have anything in the escrow deed to that11 effect?12 A. What do you mean, sorry? I can't understand.1314 THE COMMISSIONER: Could I just interrupt. Mr Di Giorgi15 obviously speaks English almost perfectly, but you are16 sometimes going rather fast and colloquially. I think you17 should be clear with him.1819 MR STOLJAR: I'll slow down, yes. Thank you.2021 Q. Perhaps we'll do it in this way, Mr Di Giorgi. Let's22 look at your response. It begins on page 368. You say in23 the second paragraph:2425 Contractor notes that although the MUA26 agreed the training fund contribution only27 in relation to the issue of the foreign28 tugs ... [Page 369] Company requires the29 right to withhold the final instalment if30 Project is impacted negatively due actions31 by MUA officials or any MUA members32 involved in the Project which are matters33 not covered by the current fund.3435 So you're saying, "Really this arose out of a dispute about36 foreign tugs"?37 A. Yes.3839 Q. "And we can't extend it to other issues"?40 A. That was for training. We agreed this for training.41 We could not use this as a leverage for anything else than42 training, so only training.4344 Q. Look at the next paragraph:4546 It is our view that imposing such condition47 ... will probably determine ...


12 I think you mean "cause the MUA to determine"?3 A. Yes.45 Q.6 ... to renegotiate the value of the fund7 contribution and in the meantime leverage8 their position with retaliatory IR actions9 offshore to receive the full payment10 upfront. The consequential schedule impact11 of such IR actions is clearly not in the12 interests of Company ...1314 You're really talking about something different here,15 aren't you? You're talking about industrial unrest in16 relation to matters unconnected with the issues arising17 from the crew of foreign tugs; is that right?18 A. I was saying that this was not what was agreed.1920 Q. Could you come through to page 371. Two days later,21 Mr Guaita sends you an email. He says at the third dot22 point:2324 Contractor -2526 that's Saipem -2728 has confirmed that as per Company's29 previous correspondence ... that Contractor30 has communicated with the MUA regarding the31 conditions for the payment into the32 Training Fund. Company again reiterates33 its verbal communication to Contractor that34 this contribution should be used as35 a leverage tool with the MUA to assist in36 achieving a successful project that is not37 impacted negatively due to actions by MUA38 officials or any MUA members ...3940 Let's take that in steps. Had there been communications41 between yourself or Mr Legrand and the MUA as a result of42 what ENI had put to you?43 A. Are you referring to the conditions of the payment44 into the training fund?4546 Q. Yes.47 A. I think these are the conditions which we wanted for


1 the money to automatically go from the escrow fund to them.2 The conditions were four conditions.34 Q. It then says:56 Company -78 that's ENI -910 again reiterates its verbal communication11 to Contractor ...1213 That's something Mr Guaita had said to you, is it?14 A. Again, it was Paolo's position, and, as you can15 understand, we were not --1617 Q. For his part, he was saying:1819 ... this contribution -2021 that's the $500,000 -2223 should be used as a leverage tool with the24 MUA to assist in achieving a successful25 project ...2627 That's what he was telling you he wanted?28 A. Yes. And I disagreed with this, also.2930 Q. You say you disagreed, but if you look at the bottom31 of the page:3233 In consideration of the above, Company will34 accept Contractor's invoice for the first35 instalment.3637 Saipem was going to invoice ENI for that first instalment?38 A. Yes.3940 Q. And Mr Guaita is telling you that he will accept -41 that is, ENI will accept - that invoice in consideration of42 what's set out above?43 A. This is what he's saying, yes. I don't think - they44 never paid this actually. It was - anyway, I'm sorry.4546 Q. In due course, the $1 million was paid, was it not?47 A. It was paid - I think it was paid. I can't remember


1 exactly the timing, but half a million was paid on the2 escrow fund, and towards the end of the project the other3 half a million was paid.45 MR STOLJAR: I note the time, Commissioner.67 THE COMMISSIONER: Do you want to adjourn now?89 MR STOLJAR: If that's convenient.1011 THE COMMISSIONER: Yes, all right. Further hearing will12 resume at noon.1314 SHORT ADJOURNMENT1516 MR STOLJAR: Q. Mr Di Giorgi, could you come to17 a different topic. In 2011 you left Saipem and you went to18 Sapura?19 A. Yes.2021 Q. What was your position at Sapura?22 A. Chief Operating Officer.2324 Q. And you reported to Mr Bressani?25 A. Yes.2627 Q. While you were at Sapura, you had been involved in28 more negotiations with the MUA?29 A. Not really. Not a lot.3031 Q. Not a lot?32 A. No.3334 Q. But at least one. Could I show you volume 2. Do you35 have that in front of you?36 A. Yes.3738 Q. Before I come to a particular page, you had a meeting,39 didn't you, with Mr Bressani and Mr Cain in May 2012? Just40 to jog your memory, you encountered the same problem,41 didn't you, about the use of foreign crews on tugs?42 A. Yes, correct.4344 Q. You had a meeting with Mr Bressani and Mr Cain about45 that matter in 2012, about two years ago?46 A. Yes, correct, yes.47


1 Q. That meeting took place in Perth?2 A. Yes.34 Q. The background was that Mr Bressani had had a few5 meetings with Mr Cain and others at the MUA about this6 issue, and then you came to a breakfast meeting in7 Cottesloe about that?8 A. Yes.910 Q. Did you only go to the one meeting yourself?11 A. I remember only that meeting. Maybe - yes.1213 Q. At this meeting --14 A. Yes, only one.1516 Q. -- it was at Clancy's Restaurant, and Mr Cain went17 along with Mr Tracey, Mr Will Tracey?18 A. Yes.1920 Q. You went along with Mr Bressani?21 A. Correct, yes.2223 Q. Again, one of the key issues was the use of foreign24 crews?25 A. Yes.2627 Q. This, by the way, related to the DomGas project?28 A. Yes.2930 Q. We're not talking about Blacktip any more?31 A. Yes, yes.3233 Q. You had some negotiations at this breakfast meeting?34 A. I don't recall we had that earlier negotiation.3536 Q. I'm sorry?37 A. I don't recall we had a negotiation. I think that the38 principle of the training fund was discussed.3940 Q. Just to remind you, this meeting was on 14 May 2012;41 does that sound right?42 A. I can't remember exactly the date, but that's probably43 right.4445 Q. Did you agree at this meeting that Sapura would46 finance training of four people, through METL, for $77,00047 each?


1 A. Yes.23 Q. Sapura also agreed to sponsor $50,000 towards an MUA4 conference?5 A. Yes.67 Q. That, as I say, occurred on 14 May. Now if you have8 a look at volume 2 and go to page 394, which is behind the9 first tab, tab 3. That's an email from the office manager10 at the WA Branch to Mr Bressani. It says:1112 Please see attached correspondence and13 invoice relating to MUA State Conference as14 discussed with the Branch Secretary,15 Chris Cain.1617 That had been the discussion the day before at the meeting.18 Do you remember what was actually said about the19 conference? Did Mr Cain tell you about it?20 A. I think it was just about the sponsoring of the21 conference, that they had this conference - I can't22 remember the details - and whether there was an interest to23 sponsor the conference.2425 Q. The DomGas project was operating at that point, I take26 it?27 A. Yes. Can I say something?2829 Q. If you need to to answer the question, yes.30 A. Yes, I think so.3132 Q. Okay.33 A. I had nothing to do with the DomGas project.3435 Q. You yourself, you mean?36 A. Yes.3738 Q. Sapura did, but not you; is that what you mean?39 A. Yes, so I may not know everything, because also the40 project manager of DomGas reports directly to Guido, so41 it's completely outside my control.4243 Q. So why did you go to the meeting?44 A. I went to the meeting because it was, I think, the45 second meeting and Guido needed support, because there was46 Chris and another person, and Guido knew that there was47 another person, and he thought that there was a negotiation


1 on numbers and he wanted support for the negotiation.23 Q. Where was the project manager for DomGas - physically,4 I mean?5 A. He wasn't --67 Q. He wasn't there?8 A. He wasn't there, yes.910 Q. All right. The next page, 395, is a letter to11 Mr Bressani. It is sent the next day, 15 May. Mr Cain12 says:1314 ...[we] would like to sincerely thank [you]15 for your sponsorship of our State16 Conference/Committee.1718 Was that the letter that you saw at the time?19 A. I haven't seen this letter before.2021 Q. You've never seen it before?22 A. I remember talking with Guido when having the coffee23 that - we probably discussed this letter.2425 Q. You discussed it because you had some discussion with26 him about whether to show the logo, didn't you?27 A. Okay, yes.2829 Q. Just read it.30 A. We discussed this, yes.3132 Q. Just read the letter to give yourself the context.33 A. Yes.3435 Q. In fact, if you come through to page 397, you can see36 there's a few emails about the pros and cons of disclosing37 the sponsorship. Why was Sapura sponsoring the conference?38 A. I don't know. I don't know why.3940 Q. Was it to get, again, good relations with the union?41 A. Probably, yes.4243 Q. And to alleviate any industrial unrest in connection44 with the DomGas Project?4546 MR CRAWSHAW: I object to this. The witness has said he47 doesn't know why. Now my learned friend is basically


1 asking him to speculate.23 THE COMMISSIONER: He started out not knowing anything at4 all about the events surrounding this May 2012 meeting, and5 his memory has come back to him in some respects. I think6 he's entitled to see whether he can get it to come back in7 more respects.89 MR STOLJAR: Q. Was part of the reason for the10 sponsorship to alleviate any industrial unrest in11 connection with the DomGas Project?12 A. I think it was to maintain a good relationship with13 the MUA.1415 Q. Isn't that really a way of saying that you were trying16 to alleviate industrial unrest in connection with the17 DomGas Project?18 A. It can be, yes, as well, yes, more as a long-term19 matter as well, yes.2021 Q. You had some emails about whether to disclose the22 sponsorship, and then if you come to page 399, Mr Bressani23 sends an email to Mr Cain, and you're copied in?24 A. Yes.2526 Q. It says:2728 Hello Christy2930 We have mobilised for DomGas. We are31 setting up on Site as we speak.3233 The project is very difficult and we34 already lost few millions ... The attached35 agreement -3637 I'll take you to that in a moment, but that's an MOU -3839 reflects our discussions to contribute an40 amount of $50,000AUD towards sponsorship of41 the MUA State Conference at a total amount42 of $308,000AUD to be used to provide43 industry specific training to 4 ...44 trainees representing a training cost of45 $77,000AUD per trainee.4647 Please check it is all in order ...


12 Then he says:34 Meanwhile I am heading back to Europe for5 a few weeks of leave and I am delegating my6 authority to Fabio in copy who will be7 heading our organisation in my absence.89 Pausing there, that's right, isn't it, you held the fort10 for Mr Bressani while he was away?11 A. Yes.1213 Q. He says:1415 Our word is what count. Help to us have a16 good project and we will honour our words.17 We need a very smooth execution. We need18 to improve productivity if we want to make19 money.2021 What he means, to your understanding, by "smooth execution"22 and "we need to improve productivity" is that he didn't23 want to have --24 A. We need to avoid disruption to the project.2526 Q. By "disruption", you mean industrial unrest?27 A. Disruption, yes.2829 Q. Industrial disruption - people taking action?30 A. Industrial disruption.3132 Q. Go slow, and that sort of thing?33 A. Yes, or finding problems or - yes.3435 Q. You mean finding problems --36 A. Yes, creating problems that maybe are not real37 problems, yes.3839 Q. What he was saying, to your understanding, was, "We'll40 pay you this money, but this is what we want in exchange:41 smooth execution, improved productivity"?42 A. This was a statement saying that, "We need a smooth43 execution if, as a company, we want to make money", yes.4445 Q. You took over when he was away; that's what he says?46 A. Yes.47


1 Q. And that was your understanding as well while you were2 heading the organisation; that's right?3 A. Yes.45 Q. You were doing a deal with the MUA, weren't you,6 "We'll pay this money and we'll get industrial peace in7 exchange", simple as that?8 A. No, I don't think this was exactly the reason.910 Q. Well, that's what Mr Bressani has spelt out in his11 email, hasn't he, "We need a very smooth execution. We12 need to improve productivity if we want to make money"? He13 says, "We've already had problems. We've lost a few14 million." Really, to your understanding, that was the15 deal, wasn't it? "We'll pay you over this money, and in16 exchange we'll get industrial peace"?17 A. No. My understanding is that this money was, again,18 for training.1920 Q. What, the $50,000 was for training, was it?21 A. Not the 50 - yes.2223 Q. Is that what you say?24 A. No, no. The $50,000 was a sponsorship.2526 Q. I'm asking you what was the point of the $50,000,27 Mr Di Giorgi?28 A. The $50,000 was a request coming from Chris Cain, "Can29 you sponsor our" --3031 Q. Yes?32 A. And I think that the decision was there was nothing33 against it. "Yes, we can sponsor."3435 Q. The deal was, "We'll pay you the money. We'll get36 industrial peace", as simple as that; that's right, isn't37 it?38 A. No.3940 Q. It was the same deal as you'd done with Saipem?41 A. No, I've not done the same deal, absolutely.4243 Q. Come to page 400. This is the MOU that was included44 in the email. Skim through or read through the whole45 thing, if you need to. I want to ask you about46 paragraph 6: (a) $25,000 within five business days, and47 (b) $25,000 on successful completion. And also the


1 training money was split up as well, wasn't it: $100,0002 now and $208,000 on completion? That was because Sapura3 wanted to keep some leverage over the MUA; that's right,4 isn't it?5 A. I don't think you should discuss this with me, because6 I was not - I'm not really the person in charge to discuss7 about this.89 Q. You were in charge then, weren't you?10 A. I think this was done before.1112 Q. I'm sorry?13 A. This was done before. I didn't prepare these for14 sure. I didn't --1516 Q. Would you agree with this proposition, that you - that17 is, Sapura - were paying the money over so you wouldn't get18 IR issues, like complaints about the use of foreign19 workers? That was the deal?20 A. There was, again, a risk identified. There was a risk21 identified on the project because we were bringing pipes22 with foreign tugs and foreign crews. There was a risk23 identified of potential disruption of the project, yes.2425 Q. That's right, and you were trying to alleviate that26 disruption by making these payments?27 A. By making these payments for training.2829 Q. Not in respect of the $50,000, Mr Di Giorgi?30 A. The $50,000 I really don't know. I really don't know31 why it was --3233 Q. You've got no idea?34 A. It was a sponsorship for - for --3536 Q. Is there any benefit to Sapura that you're aware of37 from paying that $50,000?38 A. I think it was to improve our relationship with the39 MUA.4041 Q. That's the only thing you can point to?42 A. Yes.4344 Q. Why keep it secret?45 A. I think one of the risks identified is that other46 unions would have come and asked the same training, same --47


1 Q. Paragraph 8 of the MOU says it is going to be kept2 confidential and won't be disclosed to any third parties3 for any reason whatsoever. Do you see that?4 A. Yes.56 Q. That's a very broad confidentiality clause, isn't it,7 "any reason whatsoever"?8 A. But the risk identified was that other unions would9 have come and asked in the same manner, the same things.1011 Q. And they would put you over a barrel and you'd have to12 pay them as well; is that the problem? I withdraw that.13 They would make you pay sums of money to them for so-called14 training or for conferences, is that the problem?15 A. This I don't know, but it was eventually a risk16 identified.1718 Q. Can you come to page 402. This is a tax invoice that19 was sent seeking the two tranches of $25,000.20 A. Yes.2122 Q. Again, the second tranche, the second payment of23 $25,000, is payable only on "successful completion". As24 I said to you, that's so that you could keep some leverage;25 that's right, isn't it? Are you able to answer that or26 not?27 A. I'm trying to remember, understand why it was done in28 two tranches.2930 Q. If you don't remember, I'm not trying to rush you, but31 it has been quite a while now.32 A. Yes, sorry.3334 Q. If you don't remember, just say you don't remember.35 A. I don't remember.3637 Q. Could you come to page 403.38 A. Yes.3940 Q. That's an email talking about payment under41 clause 6(a). It says:4243 Per Guido this is to be a DomGas project44 cost.4546 This is an email from the finance manager?47 A. Yes.


12 Q. And in fact you've written - if you look at the email3 below, you were chasing up the finance manager or finding4 out when that could be paid. So come back to the email5 I was showing you, which said:67 Per Guido this is to be a DomGas project8 cost.910 Is that consistent with your understanding, that these11 costs were just project costs?12 A. Yes.1314 Q. So is this the position, that Sapura had to pay money15 of this kind - that is, the training money and the16 sponsorship conference - as a project cost to achieve17 industrial peace?18 A. It was to let the members of MUA on board, that we19 would sponsor their training.2021 Q. I just want to put this to you, that the $1 million22 payment that Saipem made was also a project cost. Do you23 agree with that?24 A. Yes.2526 Q. Could you come to page 428. It is a letter to27 Mr Bressani, but did you see it yourself?28 A. I really don't remember this letter. We may have29 discussed with Guido that he has received it, but I don't30 remember.3132 Q. Did you discuss with Mr Bressani the fact that the33 money had not been deployed towards the state conference?34 A. No, I'm saying I don't remember this letter and - can35 you repeat your question, sorry?3637 Q. Let me come at it this way. You said you weren't sure38 if you remembered it, but I think you said you had some39 discussions with Mr Bressani about it; is that right?40 You're not sure?41 A. No, not sure. Really, I don't remember this letter.42 I don't remember - I don't know anything about this letter.4344 Q. Would you go back to page 400. Paragraph 7 says that45 the sponsorship funds will be applied solely and46 exclusively to the "MUA State Conference/State Committee".47 Do you see that? Now come back to page 428. You're being


1 told that you'd assisted in the delivery and convening of2 these two events. Do you see that?3 A. Yes, actually, Guido has been told, not me.45 Q. Did you have any discussion with him about the fact6 the money had been used for some other purpose?7 A. No.89 Q. Did you ask for any detail as to how your money was10 being spent - budgets, quotes, anything?11 A. Not me. As I say, I was not really --1213 MR COX: Could I rise to make this objection, or this14 observation. This witness has already given evidence that15 he didn't participate in the drafting or the work that16 ended up in the memorandum of understanding at page 400.17 How he can then give evidence about whether or not those18 objectives were met or what the money was applied to19 consistent with that subsequently is doubtful. He didn't20 participate in arriving at the objectives in the first21 place, and he can't be asked about whether they were met or22 whether there was an explanation if they apparently weren't23 met.2425 THE COMMISSIONER: I think he can be. It may be26 a fruitless inquiry, but Mr Stoljar is not bound to accept27 every answer he gets as final. He was present at the May28 2012 meeting. He was, in effect, the acting boss for some29 period. There's no preclusion of Mr Stoljar testing the30 issue or testing the proposition, if it is a correct31 proposition, that clause 6 of the memorandum of32 understanding was breached. Yes, Mr Stoljar?3334 MR STOLJAR: Q. I think I was asking you whether you35 had - by "you", I mean Sapura.36 A. Yes.3738 Q. And to your knowledge from your role and your39 discussions with Mr Bressani and the like, did you ask for40 any detail as to how Sapura's money was being spent -41 budgets, quotes, anything like that?42 A. Never.4344 Q. Is that really because you didn't care much what the45 MUA did with the money?46 A. Because this was not my project and I was not involved47 at all. I --


12 Q. Well, you say that, but - I'm sorry to interrupt.3 Please continue?4 A. I was not involved in this project.56 Q. There's a whole series of emails that you were copied7 into. For example, on page 430, in fact it is addressed to8 you, "Hi Fabio. Thanks for the update." This is about the9 training money, not the sponsorship money; I'll be clear.10 A. Yes.1112 Q. The next page?13 A. In fact, sorry, can you see that I was asking the14 installation manager the status of the project? I was15 requesting from the installation manager some information16 about the project, if you read the email on 8 April, 3:42.1718 Q. 3:42?19 A. I was just acting as - I was just forwarding mail20 and - yes.2122 Q. You say that your involvement was peripheral to this23 project, do you?24 A. It was absolutely zero.2526 Q. Can you come through to page 442.27 A. 442?2829 Q. Yes. You have a sentence in Italian there that you30 say to Mr Bressani. What does that mean?31 A. I said, "Hurry up", and it said, "Stop", because32 I think - let me read what was before. Otherwise I can't33 understand everything. So if I go to the very beginning,34 there are basically postponements. We keep postponing35 I think it was the second tranche.3637 Q. Yes.38 A. Because the project was not finished, so we were39 postponing, postponing, postponing. At a certain stage,40 I was starting receiving emails because I - because he was41 away, I became the contact point with them and I was42 starting to keep receiving email, and I was saying, "Please43 pay it. Let's stop these emails."4445 Q. Does it mean something like, "Let's pay them and be46 done with it"?47 A. No. They said, "Let's pay and that's it." I'm


1 basically getting tired of still receiving emails that the2 payment has to be done, and I was replying, "The project is3 not finished, the project is not finished", which actually4 it was almost finished; we were.56 MR STOLJAR: Nothing further, thank you Commissioner.78 THE COMMISSIONER: Mr Crawshaw?910 MR CRAWSHAW: No questions.1112 THE COMMISSIONER: Does any other legal representative13 want to ask any questions of Mr Di Giorgi?1415 MR COX: No, thank you, Commissioner.1617 THE COMMISSIONER: Can Mr Di Giorgi be excused?1819 MR STOLJAR: Yes.2021 THE COMMISSIONER: Mr Di Giorgi, thank you for attending22 today. You are excused from further attendance on the23 summons that brought you here. You may leave the witness24 box.2526 <THE WITNESS WITHDREW2728 MR STOLJAR: Could I now, Commissioner, read the affidavit29 of David Lansbury. The position is that Mr Lansbury is 7730 and has some health issues, so he will not be here in31 person today. He can't travel from Perth. I'm simply32 reading his affidavit. I can provide, for the Commission's33 records, the original of his affidavit.3435 THE COMMISSIONER: Very well. Does anyone have any36 objection to his affidavit?3738 MR CRAWSHAW: I have one objection: the second sentence39 in paragraph 17.4041 THE COMMISSIONER: That's the one that begins, "Saipem and42 ENI"?4344 MR CRAWSHAW: Yes. The reason for the objection is the45 limited nature of his industrial relations advice, which in46 turn is spelt out at paragraph 19 and in exhibits DL-7 and47 DL-7. DL-7 and DL-8 appear to be directed at documentation


1 in relation to the agreement that had already been reached2 rather than the lead-up.34 THE COMMISSIONER: Mr Stoljar?56 MR STOLJAR: As I understand it, the objection is only to7 that second sentence, Commissioner.89 THE COMMISSIONER: Yes.1011 MR STOLJAR: The documents which record the IR advice are12 those enumerated in 19. That sentence really will -13 I don't press it, as long as the documents are in.1415 THE COMMISSIONER: Yes, I think that is the position.16 Only that sentence is objected to. Mr Lansbury's affidavit17 will be received without the second sentence to18 paragraph 17, which after being objected to is not pressed.19 Mr Lansbury's affidavit is received into evidence.2021 #AFFIDAVIT OF DAVID LANSBURY DATED 26/09/20142223 MR STOLJAR: I note for the record that it is 26 September24 2014. I omitted to say that. I provide the original for25 the Commission's records.2627 THE COMMISSIONER: Very well.2829 MR STOLJAR: There is another witness who is unable to be30 here, because he's travelling overseas, Mr Danilo Codazzi.31 I tender his statutory declaration dated 20 September 201432 and I have the original for the Commission's records.3334 THE COMMISSIONER: Is there any objection to any part of35 that?3637 MR CRAWSHAW: No objections.3839 THE COMMISSIONER: Mr Codazzi's statutory declaration will40 be received into evidence.4142 #STATUTORY DECLARATION OF DANILO CODAZZI DATED 20/09/20144344 MR STOLJAR: The next witness is Mr Bressani.454647


12 <GUIDO BRESSANI, affirmed: [12.35pm]34 <EXAMINATION BY MR STOLJAR:56 MR STOLJAR: Q. Your full name is Guido Bressani?7 A. Guido Bressani, yes.89 Q. You're a resident of Western Australia?10 A. Correct.1112 Q. Can you tell the Commission your present position?13 A. I head the organisation called SapuraKencana Australia14 and my job title is Chief Executive Officer.1516 Q. Thank you. You've prepared a witness statement dated17 24 September 2014?18 A. That's correct.1920 Q. Do you have a copy of that with you in the witness21 box?22 A. Yes, I have a clean copy.2324 Q. Do you need to make any correction to that statement?25 A. Negative.2627 Q. Is the content of your statement true and correct?28 A. Yes.2930 MR STOLJAR: Commissioner, I would ask that Mr Bressani's31 statement of 24 September 2014 be received into evidence32 and I provide the original for the Commission's records.3334 THE COMMISSIONER: Mr Bressani's statement is received35 into evidence.3637 #STATEMENT OF GUIDO BRESSANI DATED 24/09/20143839 MR STOLJAR: Q. Mr Bressani, could you have a look at40 paragraph 6 of your statement. You're making reference41 there to agreements to undertake the DomGas pipeline42 installation works. Can you just tell us in a few43 sentences what that project is, the DomGas Project?44 A. Within the Gorgon Project, we were to install45 a pipeline from the jetty at Barrow Island to mainland at46 an intersection point with the Dampier to Bunbury pipeline.47 It was 90 kilometres of pipeline, 60 offshore and

.29/09/2014 60 G BRESSANI (Mr Stoljar)Transcript produced by Merrill Corporation

1 30 onshore.23 Q. In paragraph 8, you say that as part of the contract4 scope of work, it was planned to utilise six barges.5 Towards the end of paragraph 8, you say:67 Sourcing Australian crew ... would have8 been a challenge because of the limited9 resources available in Australia ...1011 And then you go on to say something else. Just explain12 what you meant by the limited resources available in13 Australia?14 A. I'm talking about the limited resources available in15 Australia for the intended scope, which was seafarers,16 which was manning the tugs.1718 Q. So you're talking about crews for the tugs?19 A. Yes.2021 Q. Why do you say that sourcing Australian crew would22 have brought safety and operational issues due to the lack23 of familiarity of the crew with the tugs?24 A. The problem is compounded in these instances by the25 fact that not only is there a limited pool of resources,26 also there is a limited pool of assets or vessels. So for27 us to employ Australian crews on this large number of tugs28 would have meant that we would have taken normally29 foreign-crewed tugs operated by an overseas owner and in30 one day put - generally it's 12, the complement of crew -31 12 new people on board the vessel. This comes with32 inherent intrinsic safety problems. No matter how33 experienced are the guys, they are not necessarily34 experienced with that vessel, with the systems of the35 vessel, with the owner, and there is a learning curve which36 is generally affected by safety issues, because they don't37 know the ins and outs of the specific asset.3839 Q. In paragraph 11, you're talking about project40 briefings, and are you talking here about industry41 practice?42 A. Correct.4344 Q. Where are the project briefings normally held?45 A. In terms of the location itself?4647 Q. Mmm.


1 A. I actually don't know.23 Q. It varies?4 A. It could be in our office. It could be in the union's5 office.67 Q. I see. Can I ask you to come to paragraph 12. In8 this case, there was a project briefing in Fremantle. Did9 people report back to you after that meeting?10 A. That's correct.1112 Q. In paragraph 13, you say:1314 ... the tone of the meeting escalated ...1516 What did you mean by that? It got a bit heated; is that17 what you mean?18 A. Yes, yes, colourful, yes, heated.1920 Q. Your first meeting was two days later, on 10 May 2012.21 Where were you based at that time? Were you in Perth?22 A. In Perth.2324 Q. You've described what happened at that meeting in25 paragraph 15. In a nutshell, the gist of it was that26 Mr Cain was unhappy about the use of foreign-crewed tugs?27 A. Correct.2829 Q. You say in paragraph 16 that you thought it was30 unavoidable. Then why don't we come directly to the31 meeting on the 14th. There's an agreement here that you32 would finance training of four people for $77,000 each and33 you would sponsor $50,000 towards an MUA conference. What34 did Mr Cain tell you about the conference?35 A. What I recollect is that it was explained to us that36 the conference was an event where members were given the37 opportunity to be presented with an update on the industry,38 opportunities in the industry, safety issues - in a way,39 a form of training; that's what it was represented to us.4041 Q. Do you have two folders of documents on the desk in42 front of you there?43 A. Yes.4445 Q. Could you have a look at volume 2 and would you come46 through to page 394. The day after your meeting on the47 15th you got an email from the office manager at the


1 WA Branch and a letter was attached. That's at page 3952 and that's a letter that you read on or about that day?3 A. Yes.45 Q. It says "Sponsorship of MUA WA Branch State6 Conference/State Committee". They're thanking you for your7 sponsorship of that conference, in the first paragraph.8 The second paragraph:910 We appreciate your support so far and your11 anticipated sponsorship of $50,000 for the12 MUA Conference ...1314 You were hoping to improve relations with the union as15 a result of making that payment?16 A. As well, yes.1718 Q. And you were hoping to procure a circumstance in which19 there was limited or no industrial unrest on the DomGas20 Project?21 A. I'm sorry, I'm not sure what you mean by "procure".2223 Q. There had already been some industrial unrest in24 relation to the DomGas Project?25 A. Negative.2627 Q. None at all?28 A. Negative.2930 Q. Okay. Had you done other projects in Australia at31 that time?32 A. Yes.3334 Q. Had you encountered any situations in which there had35 been industrial unrest?36 A. Yes.3738 Q. And were you hoping to avoid that by making these39 payments?40 A. Yes, it was part of that.4142 Q. An invoice was attached, page 396, seeking $50,000 in43 sponsorship. That was going to be payable, it looks like,44 immediately or at least within a reasonable period after45 the date of the invoice. Then on page 397 you had an46 exchange of emails about using the logo. What did you47 decide to do, in the end, to use it or not?


1 A. No, I decided not to use it.23 Q. At the top of that page, Mr Flood says to you:45 Guido6 There are pros and cons, of course. On7 balance I don't believe it will do any8 harm ...910 In the final sentence, he says:1112 Clients normally do not get to see any of13 this.1415 Who are the clients he's referring to?16 A. I believe he was making reference - and I'm only17 assuming here - to Chevron, which was the client.1819 Q. That's right. So he said, "Chevron won't see it, but20 the MUA officials and members might", or "would", in fact?21 A. I think that's the essence of this email.2223 Q. Anyway, you decided not to. If you come through to24 page 399, you sent an email to Mr Cain on 21 June 2012.25 I'll take you through the email, but have a look at26 page 400. That was an MOU that you drafted at this point?27 A. I did not draft this. Members of my team did for me.2829 Q. Members of your team drafted it?30 A. But I own this, yes.3132 Q. You read through it and you were happy with it?33 A. In detail, yes.3435 Q. Come back to the email. You say:3637 Hello Christy3839 We have mobilised for DomGas. We are40 setting up on Site as we speak.4142 The project is very difficult ... The43 attached agreement reflects our discussions44 to contribute ...4546 Meanwhile I am heading back to Europe for47 few weeks ... and I am delegating my


1 authority to Fabio ...23 Then this paragraph:45 Our word is what count. Help us to have a6 good project and we will honour our words.7 We need a very smooth execution. We need8 to improve productivity if we want to make9 money.1011 By that, you meant you didn't want to have a lot of12 disruption?13 A. Ultimately, yes.1415 Q. By "disruption", you mean industrial unrest?16 A. Well, it doesn't have to get to that. There are17 stages to get to that, and the stages are fabricating18 issues that are maybe not really there that attract the19 attention of our group, as opposed to focusing on20 delivering a safe product to our customer. So industrial21 unrest, for me, is where we don't have to get to. We need22 to --2324 Q. By "fabricating issues", you mean, what, creating25 safety concerns when there really weren't any?26 A. Or in my previous experience - not in this project,27 which was very smooth - we had issues associated with the28 level of the accommodations or to fumes on the deck, things29 where I believed that with the support of the MUA in30 talking to their members, this could have been not raised31 as an issue, not attract our attention, not distract our32 focus from what was important.3334 Q. You were hoping to get the MUA to assist in dealing35 with those issues by making these payments?36 A. That's affirmative, yes.3738 Q. If you come over to page 400 - I'm sorry, I just want39 to pick up one thing you said, before we leave that. You40 said that this project, the DomGas Project, didn't have the41 kinds of issues you were describing; it went very smoothly?42 A. Yes. From an industrial relations point of view, it43 was a very good project, yes.4445 Q. You attribute part of the reason for that, I take it,46 to the fact that you made these payments that you had been47 asked to do by the MUA?


1 A. Well, MUA was a relatively small part of the project.2 Our main vessels were not self-propelled vessels. That3 means they did not attract MUA personnel. So MUA was part4 of the equation, and keeping a good relationship with MUA5 definitely contributed to the smooth execution of the6 project insofar as MUA members were concerned.78 Q. Did you need to make similar payments to any other9 unions?10 A. No, we did not pay other unions.1112 Q. Did you pay other funds that they were asked to --13 A. We made contribution to another training fund, funded14 for what we called construction union training, which was15 the Brunel Fund, yes.1617 Q. The which fund?18 A. The employing entity used for construction crew, which19 is AWU, AMWU, CEPU personnel. It's called Brunel Energy,20 or Brunel. I'm not sure of the name of the legal entity.21 In their EBA, they had a commitment to train people, and we22 contributed to that commitment.2324 Q. Can you have a look at the MOU. It's on page 400.25 Have a read through the whole thing if you need to, but26 I want to ask about paragraph 6. The payments were to be27 paid made in two tranches, one at the beginning and one at28 the end, in effect?29 A. Correct.3031 Q. Is that because you wanted to keep some leverage over32 the MOU in connection with these payments?33 A. Affirmative.3435 Q. So if, for example, relations broke down and there was36 a lot of industrial unrest, you wanted to be in a position37 to say, "Well, we're not going to pay you that second38 tranche"?39 A. Yes.4041 Q. Then paragraph 7 says:4243 The parties agree that the sponsorship44 funds ... shall be applied solely and45 exclusively to sponsor the MUA State46 Conference/State Committee.47


1 That's what had been suggested to you at the breakfast2 meeting?3 A. That's correct.45 Q. And paragraph 8:67 The parties agree that the terms of the MOU8 are confidential ...910 Who wanted to have the confidentiality clause? Was that11 you or the union, or both?12 A. Look, we generated this. They did not comment. So it13 is on our part. I did not specifically request14 confidentiality in - I would say it's present in all of our15 agreements, a certain level of confidentiality. This is16 very broad, I realise, but it is common practice in any17 agreement we have, with any entity, to have confidentiality18 agreement.1920 Q. It is, but as you fairly acknowledge, it is a very21 broad confidential clause?22 A. I realise it's a very - it's a very broad MOU, I mean,23 yes.2425 Q. Were you particularly concerned about confidentiality26 in respect of this MOU?27 A. No, not necessarily.2829 Q. Could you come through to page 402. That's a copy of30 tax invoice 808. Without leaping around too much, if you31 go back to page 396, there's a version of tax invoice 808.32 It is the one we looked at, and it just has an amount of33 $50,000. The one on 402 is in two tranches. Was that34 prepared after your MOU?35 A. Yes.3637 Q. Then on page 407, Mr Cain sent through a signed38 version of the MOU in July. I will take you right through39 to page 428. That was a letter you received from Mr Cain40 on or about 12 September 2012?41 A. Correct.4243 Q. He's thanking you, or Sapura, for the sponsorship. He44 doesn't make reference to the state conference in his45 letter, does he?46 A. No, he doesn't.47


1 Q. Were you concerned, when you got the letter, that the2 money had not been used for the state conference but for3 something else?4 A. I realise today that there was a breach in that.5 I honestly did not realise that we were very specific in6 the MOU about this type of conference. In my mind, the7 intent was to say "conference events". This is something8 that happened, and I realised just 20 minutes ago that9 there was --1011 Q. You mean listening to Mr Di Giorgi's evidence?12 A. Yes.1314 Q. It's not so much "conference" or not, but weren't you15 concerned about how the money was going to be used? Did16 you ask for quotes or brochures or any information?17 A. Yes. I asked at the meeting and I said, "What are18 these conferences?", and I was provided I think the day19 after, by Will Tracey, a little bit of details, "This is20 what we have done in the past."2122 Q. I think we have that material. I'll just see if I can23 track it down, Mr Bressani. Is that the material in --24 A. Affirmative, yes.2526 Q. -- your statement?27 A. Not in my statement. I think it is material in the28 evidence I provided before the statement.2930 Q. Yes. You've got a copy of your statement there?31 A. Yes. Yes.3233 Q. Could you come through to attachment C. The pages in34 your statement aren't numbered. You'll just have to go to35 the attachments and keep going until you get to36 attachment C in the top right-hand corner.37 A. Yes, I'm there.3839 Q. That's the email from Mr Tracey that you made40 reference to?41 A. Yes.4243 Q. He attaches, does he, a few pages in, a copy from what44 is said to be the 2011 State Conference Agenda?45 A. Yes, that's correct.4647 Q. Did you read through that?


1 A. No, not in detail. For sure, I didn't read it in2 detail.34 Q. You didn't read it?5 A. Look, I read it much more in detail in the past weeks6 rather than at that time.78 Q. At the time, you didn't really read it?9 A. Correct.1011 Q. Could you come through to page 430 in the bundle.12 This is an email from Mr Earle. It is addressed to13 Mr Di Giorgi, but as you've heard - you heard14 Mr Di Giorgi's giving evidence?15 A. Affirmative.1617 Q. He was saying that he didn't actually have much18 involvement in this project, so I'll ask you about it,19 although the email is addressed to him. This is in20 relation to the training money as distinct from the21 sponsorship money. He says:2223 Six TIRs completed college last year.24 All are now serving on vessels in order to25 complete their required sea-service.2627 Do you know whether those are Sapura vessels?28 A. I can tell you they were not Sapura vessels.2930 Q. They were not. Were they tugs?31 A. I don't know.3233 Q. Well, if you don't know whether they're tugs and34 they're not Sapura vessels, the fact that they were working35 on vessels somewhere doesn't help Sapura to complete the36 DomGas Project, does it?37 A. That's correct, there was no direct relation there.38 I had a vested interest to ensure the growth of local39 opportunities and providing training. We were not trying40 to say they're going to train on our project. We did not41 own and operate self-propelled vessels that could have42 hosted these people, because that would have been the43 preferred way, but we didn't have them.4445 Q. So it is really just that, in a general sense, you46 were providing some funds for people to be trained for47 vessels quite unconnected with Sapura?


1 A. Yes.23 MR STOLJAR: Nothing further. Thank you Commissioner.45 THE COMMISSIONER: Mr Crawshaw?67 MR CRAWSHAW: No.89 THE COMMISSIONER: Does anyone else want to ask10 Mr Bressani any questions?1112 MR ELLERY: Nothing further, Commissioner.1314 THE COMMISSIONER: Mr Bressani may be excused?1516 MR STOLJAR: Yes, Commissioner.1718 THE COMMISSIONER: Thank you, Mr Bressani, for attending.19 You are excused from any further attendance on your20 summons.2122 <THE WITNESS WITHDREW2324 MR STOLJAR: Commissioner, the next witness is25 Mr De Meulenaere.2627 <JORIS DE MEULENAERE, affirmed: [12.59pm]2829 <EXAMINATION BY MR STOLJAR.3031 MR STOLJAR: Q. Could you tell the Commission your full32 name?33 A. Joris De Meulenaere.3435 Q. You're a resident of Queensland?36 A. Correct.3738 Q. You are the Human Resources Manager of Dredging39 International (Australia) Pty Ltd?40 A. Correct.4142 Q. You have prepared a witness statement dated43 24 September 2014?44 A. Correct.4546 Q. Do you have a copy of that with you?47 A. I have a copy.

.29/09/2014 70 J DE MEULENAERE (Mr Stoljar)Transcript produced by Merrill Corporation

12 Q. Do you need to make any correction to it?3 A. No.45 Q. Is the content of your statement true and correct?6 A. Yes.78 MR STOLJAR: Commissioner, I would ask that9 Mr De Meulenaere's statement be received into evidence.1011 THE COMMISSIONER: Yes. As there are no objections, that12 will be received into evidence.1314 #STATEMENT OF JORIS DE MEULENAERE DATED 24/09/20141516 MR STOLJAR: Q. Mr De Meulenaere, in paragraph 4 you say17 that you started working for DIAU on 17 April 2012 and you18 reported there to Mr Vermeulen?19 A. Correct.2021 Q. He left in October 2013 and you were then promoted to22 Human Resources Manager?23 A. Correct.2425 Q. Did you only come to Australia on 17 April 2012?26 A. Yes, correct.2728 Q. In paragraph 12 of your statement, you say that in29 2009 an EBA was entered into. Do you know how many30 workers, approximately, that covered?31 A. The EBA covered approximately 105 employees.3233 Q. Do you know what sorts of jobs they were doing, what34 sort of work they were doing, the 105?35 A. The eligible employees were working on propelled36 vessels in the positions covered by the EBA.3738 Q. I can work off your statement at least for now,39 because there are page numbers in the middle of the page,40 but can I take you through to clause 41 of the 2009 EBA.41 I'm trying to read the bottom. I think it might be page 2942 of 35. Do you have a copy of the attachments to your43 statement or just the statement itself?44 A. I only have my statement here.4546 Q. Let me give you a full copy of your statement. You47 may have a limited knowledge of the circumstances in


1 which - just when you've found it, if you go to JDM1,2 page 29 of 35, the numbering in the middle of the page at3 the bottom, clause 41.4 A. Yes.56 Q. Have you found it?7 A. Yes.89 Q. It was before your arrival, but do you know from your10 discussions with Mr Vermeulen or otherwise anything about11 the negotiations for this clause 41?12 A. No.1314 Q. Do you know why there was an MOU separate from the EBA15 itself?16 A. No. I actually don't know anything about these17 negotiations.1819 Q. You don't know anything about them, all right. Could20 you come back to paragraph 19 of your statement. You're21 making reference there to the 2012 EBA. Did that cover22 approximately the same number of employees?23 A. I don't know how many employees it would cover at that24 time. Now, today, we are covering 119 employees. But25 that's today. I don't know the figures of that day.2627 Q. For 2012?28 A. No.2930 Q. So that's JDM2. Could you come through to clause 9.31 These clauses are rather hard to read. You'll find32 a better copy of that clause in the bundle. Do you have33 volume 2 there, Mr De Meulenaere?34 A. Yes.3536 Q. If you have a look at page 486, that's a slightly37 better version.38 A. Yes.3940 Q. Clause 9 regulates payments to the training fund or41 a training plan. Clause 9.2, compulsory 1 per cent42 training by employees, training contribution. That43 increases each year, does it?44 A. It is 1 per cent of the - actually, they agreed on45 a 6 per cent salary increase, but 1 per cent would go into46 employees' contribution for training.47


1 Q. But it then says in about the middle of 9.2.3:23 The employee contribution to METL shall4 grow to a total of 4% by the 4th year of5 operation of this Agreement.67 Is that the case? Is the payroll contribution increasing?8 A. No. It's 1 per cent, it's still 1 per cent, but at9 the end it will be 4 per cent. It's the sum of four times10 1 per cent.1112 Q. So is it growing by 1 per cent each year?13 A. It's 1 per cent each year, and that's it.1415 Q. It remains at 1 per cent, but you say it will still be16 1 per cent in the fourth year of operation?17 A. Yes.1819 Q. Would you have a look at clause 9.3. That's in the20 event the employer does not make or ceases to continue to21 making the training contribution. It says that the22 employer shall instead increase the wage rates by23 1 per cent each contribution year up to the maximum of24 4 per cent. Doesn't that suggest that the way it works is25 that it is 1 per cent, then the next year it's 2 and the26 next year it's 3?27 A. Our interpretation is that it is 1 per cent for each28 year, and if you add four times 1 per cent, it's29 4 per cent.3031 Q. So that's what's being paid at the moment, is it -32 1 per cent?33 A. Yes, correct.3435 MR STOLJAR: I am about to move to another topic, if36 that's a convenient time, Commissioner.3738 THE COMMISSIONER: Yes. The hearing will resume at 2pm.3940 LUNCHEON ADJOURNMENT41424344454647


1 UPON RESUMPTION:23 THE COMMISSIONER: Yes, Mr Stoljar.45 MR STOLJAR: Q. Mr De Meulenaere, could you go to6 volume 2, page 480. That's some minutes of a meeting7 attended by your predecessor, January 2012, just before you8 arrived. I just want to ask a few questions about it. If9 you just come to paragraph 15, it's recorded that the -10 this is a discussion between the MUA and Dredging11 International. Paragraph 15 says:1213 [Company] needs to agree to cover Union14 Officials travel and accommodation costs15 during the negotiations.1617 Was that typical, so far as you knew?18 A. I wasn't there at the meeting.1920 Q. No, but is that the practice that you've come to be21 familiar with?22 A. It is my understanding that it is the practice, yes.2324 Q. If I show you page 483, those are the sorts of25 expenses that the company will pay?26 A. This is referring to EBA negotiations, yes.2728 Q. Then come back to page 481. It says at paragraph 16:2930 When DIAU is awarded a Project:3132 a. the Company will provide the Union with33 a detailed "Briefing" to resolve any34 anticipated/possible issues ...3536 Again, that's your understanding of industry practice?37 A. Yes, correct.3839 Q. Or at least the practice that your company has40 followed?41 A. Correct.4243 Q. On page 503, this looks like a trip in connection with44 the Wheatstone Project for a number of persons, but that's45 in September 2013, so you had been there for a while then.46 That's the sort of briefings that the company will pay for?47 A. That's my understanding, yes.


12 Q. Come back to page 481, and 16(b) deals with vessel3 inspections. Is it also the case, to your understanding,4 that the company will pay for union officials to carry out5 vessel inspections?6 A. Correct.78 Q. An example of that is at page 491. Travel to Europe9 by Mr Cain in June 2012 for international vessel10 inspections. That's an example of the company picking up11 or paying for that kind of vessel inspection?12 A. Correct.1314 Q. So all these are expenses that the company meets in15 connection with the EBA negotiations?16 A. The vessel inspections are not necessarily related to17 EBA negotiations.1819 Q. In any event, they're expenses that the company meets?20 A. Yes.2122 Q. Shortly after your arrival in Australia, the 2012 EBA23 was approved. One can see that at page 484. That EBA was24 approved on 8 May 2012?25 A. Correct.2627 Q. You had been with the company in Australia for about28 a month by that stage?29 A. Correct.3031 Q. Had you been involved in the negotiations in respect32 of the EBA in the period leading up to 8 May 2012?33 A. No.3435 Q. Were you involved in an agreement by Dredging36 International to sponsor the MUA conference which was37 reached at about that time?38 A. No, I was not involved.3940 Q. You were reporting to Mr Vermeulen?41 A. That's correct, I was reporting to Mr Vermeulen.4243 Q. And would he have been the person at Dredging44 International who was negotiating that matter?45 A. He was the one negotiating, yes.4647 Q. If you come to page 488, on 9 May 2012 Mr Cain wrote


1 in respect of Dredging International sponsoring the MUA2 WA Branch State Conference and referred to an agreement to3 sponsor in an amount of $200,000 for a four-year period,4 2012 to 2015. Do you see that?5 A. Yes.67 Q. I take it you've become familiar with that since that8 time, even if you weren't involved at the time?9 A. I was not involved and I was not familiar with this10 agreement at that time, no.1112 Q. No, but once you took over from Mr Vermeulen, did you13 become aware of it or was it just not something that you14 ever really thought about?15 A. I only became aware of it whilst we had the handover,16 Mr Vermeulen and I, yes.1718 Q. In about October last year?19 A. That's October last year, yes.2021 Q. Did Mr Vermeulen tell you about it? Did he say22 anything about how it came to be agreed?23 A. No.2425 Q. Did he tell you that it was conditional on the EBA26 being approved?27 A. No, he didn't tell me.2829 Q. You mean he didn't say one way or the other?30 A. He didn't tell me anything about the negotiation.3132 Q. The fact that this letter was sent on 9 May 2012, the33 day after the EBA was approved, does that suggest to you or34 does that remind you that it may have been conditional on35 that EBA being approved?36 A. I don't know.3738 Q. Page 489 is an invoice. Did you have any discussion39 about that with Mr Vermeulen?40 A. No.4142 Q. Go back to your statement for a minute, paragraph 40.43 You're dealing with some correspondence about these issues.44 In subparagraph 40(1) you mention reimbursement of travel45 costs, and then subparagraph (2) is sponsorship. In46 paragraph 41 you say travel costs - "based on my discussion47 with Mr Vermeulen". Pausing there, you mean in October


1 2013?2 A. No. I called Mr Vermeulen on 11 September, after3 I got the phone call from Mr Molan.45 Q. He told you then, did he, that the travel costs were6 for industry practice. In subparagraph 41(2):78 (2) the payments for the sponsorship of the9 state conference ... were made at the10 request of the MUA. I do not know who ...11 made this request or why DIAU agreed to12 make the payments.1314 You didn't ask him about that matter?15 A. I didn't ask him why they made the payment, no.1617 Q. You set out the quantum of contributions in18 paragraph 42. In paragraph 44, you say what the purpose of19 the sponsorship was, but you say in paragraph 45:2021 [That] is based entirely on the22 correspondence referred to in the next23 three paragraphs.2425 If I take you to that, it might be easier, because the26 pages attached to your statement aren't numbered. If we go27 back to the bundle, page 488 is the letter we were just28 looking at. Did you only just see this letter relatively29 recently when you were preparing your statement as well?30 A. Yes, that's correct.3132 Q. The next two letters you refer to - the first is at33 page 492. It is thanking Dredging International for34 supporting these two conferences. Then page 493 is another35 letter of 19 September 2012. These are the further two36 items of correspondence that you refer to in your37 statement. Is this the position, and tell me if it isn't:38 you can't say anything more than what you have read in39 these letters; you don't know anything about them?40 A. That's correct.4142 Q. Are you able to shed any light on why other43 conferences are being referred to when the $200,000 related44 to the state conference, or you just don't know one way or45 the other?46 A. I don't know.47


1 Q. Would you come back to paragraph 49 of your statement.2 You say:34 In my opinion [Dredging International]5 obtains no appreciable benefit as a direct6 consequence of the payments, other than the7 intangible benefit of being seen to8 maintain a working relationship with the9 MUA, and the indirect benefits that might10 come from consideration of the issues11 identified in paragraph 44.1213 Is that also based on your conversation with Mr Vermeulen?14 A. The intangible --1516 Q. That whole paragraph.17 A. It's based on the documents that I have found, the18 letters and my opinion.1920 Q. Just before we leave paragraph 49, it says "the21 intangible benefit of being seen to maintain a working22 relationship with the MUA". What did you mean by that?23 A. That it's an intangible benefit, that you can't24 measure the real benefit of it.2526 Q. But did you mean that the union is less likely to27 incite its members to take action?28 A. No, it shows that we as a company are not hostile to29 a union and that we work together.3031 Q. Can I ask you to have a look at the heading32 "MUA Training and Development Fund". You now start dealing33 with some more payments into various funds. You say at34 paragraph 53:3536 I understand based on my discussion with37 Mr Vermeulen ...3839 That again is just in the last few days, is it?40 A. 11 September, yes.4142 Q. Where is Mr Vermeulen?43 A. In Europe.4445 Q. You say:4647 ... as a result of discussions between the


1 MUA and Mr Vermeulen.23 Did he say who at the MUA he was dealing with?4 A. No, he just mentioned the union.56 Q. Then you say you weren't in Australia at the time.7 Paragraph 54 has the quantum. If you've still got volume 28 there, the first amount is $338,000 and there was an9 invoice issued 14 December for that sum. Then the next10 amount you refer to is two lots of $169,409, the first of11 which was the subject of an invoice that's on page 497 and12 the second of which is at page 501. 25 March to 4 June13 2013 - to be clear, in subparagraph 56(2) you make14 reference to a letter of 4 June 2014. Did you mean the15 letter at page 500, which is 4 June 2013?16 A. Can you repeat that question, please?1718 Q. Yes. In subparagraph 56(2), you make reference to19 a letter of 4 June 2014 from Mr Cain. I think you're20 referring to the letter on page 500 of the bundle, which is21 4 June 2013; is that right? It's just a typo, that's all.22 I'm just trying to identify if that's the correct date.23 A. Yes, that's correct. Sorry.2425 Q. Let's focus on these two payments of $169,000-odd, so26 the two invoices at pages 407 and 501. If I understand27 your statement correctly, you say the only information you28 can find about the reason for those payments are the29 letters at pages 496 and 500; is that right?30 A. That's right.3132 Q. Let's have a look at page 496. It is a letter of33 25 March 2013 that attaches invoice number 865. That's the34 invoice on page 497. It says:3536 ... [we] would like to thank you ...3738 Support for training and development will39 assist us in the delivery and convening40 and/or attendance of our members and41 officials at the following events ...4243 The first is "State and National MUA conferences". Do you44 see that?45 A. Yes.4647 Q. You'd already agreed and had paid $200,000 in 2012 for


1 the state conferences, hadn't you?2 A. Yes, but, again, I don't know why it has been agreed3 or why it has been said as such in this letter.45 Q. Have you asked anybody?6 A. No.78 Q. You're the Human Resources Manager, aren't you?9 A. That's correct.1011 Q. You have been for the last year?12 A. That's correct.1314 Q. You've taken over from Mr Vermeulen?15 A. That's correct.1617 Q. This is your responsibility?18 A. Correct.1920 Q. So have you wondered why you were being charged in21 excess of $300,000 for, among other things, state and22 national MUA conferences when Dredging International had23 already paid $200,000 for the state conferences?24 A. This letter was not sent to me; it was sent to25 Mr Vermeulen and I only found this letter when I was asked26 to provide evidence.2728 Q. Even since then, have you wondered about it at all?29 What's going on, Mr De Meulenaere? It seems as if there's30 money flooding out of this company to this union, and31 no-one can tell us why?32 A. It is my understanding that the payments have been33 made for the purposes that are described in the letters.3435 Q. The letter says "state and national MUA conferences".36 That's what it says on 25 March 2013. If we come to 4 June37 2013, it says exactly the same thing, "state and national38 MUA conferences". Item 1, there's another $169,000; is39 that right?40 A. That's correct, yes.4142 Q. In both cases, you had already paid, one year before,43 approximately, $200,000 for this very same thing, the state44 conference?45 A. Correct.4647 Q. And you haven't asked anybody about it; no-one has


1 raised that as a concern with you?2 A. It hasn't been raised to me, no.34 Q. That's because the real reason for the payment is to5 minimise any industrial disruptions that might be caused by6 the MUA in respect of Dredging International's work; that's7 right, isn't it?8 A. I don't think so.910 Q. You don't care, really, what they do with the money11 once they've received it, because that's the true purpose12 of the payments; that's right, isn't it?13 A. The purpose of the payments is, as far as I'm aware,14 for the purposes that are set out in the correspondence15 that I have received, or that DI has received.1617 Q. We've just discussed that, haven't we,18 Mr De Meulenaere, and what's abundantly clear is that this19 really sheds no light whatsoever on what this money was20 used for? What do you say is the true purpose of Dredging21 International paying this money?22 A. Excuse me?2324 Q. What is the true purpose of Dredging International25 paying this money? What do you say it is?26 A. I can only base my opinion on the documentation that27 I have, and it is used for the purposes that are mentioned28 in the letter.2930 Q. You can't shed any light on why, when the letters31 refer to the state conference - the two letters, 25 March32 and 4 June, both refer to the state conference - the fact33 that you'd already paid $200,000 for the state conference34 a year before, you just say you've got no idea?35 A. The letters were sent to Mr Vermeulen and, as I said,36 I was not involved.3738 Q. No, but you are now.39 A. That's correct.4041 Q. You're the man now, aren't you, who has responsibility42 for all this, Mr De Meulenaere?43 A. That's correct.4445 Q. You were his deputy at the time?46 A. Yes, that's correct.47


1 Q. And you were reporting to him?2 A. I was reporting to him.34 Q. Didn't you discuss it?5 A. I was not involved in any discussion with the union at6 that time.78 Q. Did you get back to the MUA, or anyone there, to your9 knowledge, and say, "Why are you charging us twice?"10 A. I was not involved in the discussions.1112 Q. You're the man now making decisions, I take it?13 A. Correct.1415 Q. Would you now pay for an MUA state conference, given16 these letters you've been looking at?17 A. I will have a discussion with the union what the18 purpose of the money is.1920 Q. You'll have a discussion?21 A. Yes.2223 MR STOLJAR: Nothing further.2425 <EXAMINATION BY MR CRAWSHAW:2627 MR CRAWSHAW: Q. Mr De Meulenaere, just keeping with28 those documents, or keep them open, in your statement at29 paragraph 60, under the heading "Benefits DIAU received in30 return", you say:3132 It is imperative for [Dredging33 International] to have trained and capable34 Australian employees within the maritime35 industry to man its vessels according to36 the flag state requirements.3738 Do you see that?39 A. Yes.4041 Q. You also say:4243 The company obtains a benefit from having44 a skilled workforce. These skills may take45 a number of forms including the "hard"46 skills of formal training and47 qualifications to the "softer" skills of

.29/09/2014 82 J DE MEULENAERE (Mr Crawshaw)Transcript produced by Merrill Corporation

1 understanding the applicable safety2 legislation and being able to appropriately3 contribute as health and safety4 representatives on the projects that DIAU5 is involved in.67 Do you see that?8 A. Yes.910 Q. I suggest to you that the letters that my learned11 friend has just taken you to at pages 496 and 500 are an12 example of employees being trained in the softer skills of13 understanding the applicable safety legislation and being14 able to appropriately contribute as health and safety15 representatives; is that right?16 A. That's correct.1718 Q. In particular, when you talked about those benefits,19 you had regard not only to what happened at the state20 conference but also to what happened at these other21 conferences named in those letters, namely, the offshore22 divers' conferences, the NOPESMA health and safety23 representatives being discussed there, the national safety24 conference and the health and safety representatives'25 courses; that's what you were talking about in paragraph 6026 when you referred to the benefits?27 A. That's correct.2829 MR CRAWSHAW: Thank you.3031 THE COMMISSIONER: Do any other people want to ask any32 questions?3334 MR NEIL: No, thank you, Commissioner.3536 THE COMMISSIONER: Very well. There's no objection to37 Mr De Meulenaere being excused?3839 MR STOLJAR: No, Commissioner.4041 THE COMMISSIONER: Mr De Meulenaere, you are excused from42 any further attendance on the summons. You can leave the43 witness box now, thank you very much.4445 THE WITNESS: Thank you.4647 <THE WITNESS WITHDREW

.29/09/2014 83 J DE MEULENAERE (Mr Crawshaw)Transcript produced by Merrill Corporation

12 MR STOLJAR: The next witness is Mr Meijers.34 MR KOSTOPOULOS: To assist the Commission, he has his5 entire statement. He will be giving evidence on oath.67 <MARINUS PIETER MEIJERS, sworn: [2.28pm]89 <EXAMINATION BY MR STOLJAR:1011 MR STOLJAR: Q. Could you tell the Commission your full12 name?13 A. Marinus Pieter Meijers in my passport and my call name14 is Martin.1516 Q. You're a resident of Queensland?17 A. Correct.1819 Q. Can you tell the Commission your current position?20 A. I'm an area manager for Van Oord. I'm looking after21 the area Australia and New Zealand, and, as such, we have22 an entity here, which is Van Oord Australia Pty Ltd. I'm23 managing director of that entity, and for two other24 entities we have in this region.2526 Q. You have prepared a witness statement dated27 24 September 2014?28 A. Correct.2930 Q. I gather you have a copy of that with you in the31 witness box?32 A. Yes.3334 Q. Is the content of your statement true and correct?35 A. I believe so.3637 MR STOLJAR: Commissioner, I would ask that that statement38 be received into evidence and I provide a copy of the39 original for the Commission's records.4041 THE COMMISSIONER: Yes, that will be received into42 evidence.4344 #STATEMENT OF MARINUS PIETER MEIJERS DATED 24/09/20144546 MR STOLJAR: Q. Meijers, you have been, since October47 2013, a director of METL?

.29/09/2014 84 M P MEIJERS (Mr Stoljar)Transcript produced by Merrill Corporation

1 A. Correct.23 Q. I will take you directly through to paragraph 94. You4 set out here a series of payments made to MUA's Training5 and Development Fund. These are quite separate from the6 payments that Van Oord has made to METL?7 A. Correct.89 Q. Once you had established METL, was there any10 particular reason to start making payments to MUA directly?11 A. At that time, there was. The whole discussion -12 I came in July 2011 and what you saw at that time, you had13 two things. You had either training in general, which we14 had to do for various unions, like the officers, the15 engineers and the functions covered by MUA, but apart from16 that, you also had that we, as Van Oord, saw a big boom in17 the west. What we saw in the west was, because we work on18 a project basis - a vessel comes, so we have to employ19 a lot of persons, and what we saw is that each time when20 those persons came on board, they were missing dogging and21 rigging and working at heights, so we all started again.22 Starting when those people came on board the vessel, before23 they could climb on something, first we had to do "working24 at heights", for example.2526 So it was commonsense, and it was initiated by the MUA27 and I found it a good plan. If you start a WA training28 school to focus particularly on dogging, rigging and29 working at heights, if they could train their members30 because most of those people we employ in the functions we31 have under the EBA. Anyway, in times there was not so much32 work, then at least when the guys came on board, I didn't33 have to start again - or we, as Van Oord, didn't have to34 start again to do all the training. So I saw merit in it,35 especially because you saw that in the west a lot of work36 was coming. Most was for tender, there was work we were37 tendering for in Wheatstone, working on Gorgon.3839 Q. The training school to which you make reference is the40 one that you refer to in paragraph 100?41 A. Yes, that is the same in 100 - we still speak about42 what we write in 94. So in 94, we say the payments we did43 make for the WA training fund and then we go and explain44 what all happened. During that process, it was45 commonsense, although it was an initiative of the Western46 Australian MUA Branch to start the training school, to hand47 that over to METL, because METL was really kicking in, you


1 understand what I mean? In 2011, when I came, I got the2 feeling that although METL was established in 2008/2009,3 I really saw that by, say, early 2012 METL was really4 starting to work. And then I knew that there were - I had5 discussions, I heard that the MUA was thinking to hand it -6 although it was an initiative and allocated money for7 a training school in the west, to bring it under METL and8 METL would take it under their umbrella. I don't know if9 I'm allowed to say it, but if you look at the board papers10 of METL, you still see that that money is allocated for11 a training school to be established in the west.1213 Q. That's something that METL is looking at doing, is it?14 A. Yes.1516 Q. At paragraph 101 you deal with payments to sponsor the17 MUA state conference?18 A. Yes, I heard the statements of all the other guys this19 morning, but it was totally different. I came in 2011;20 I wrote it in my statement. So we had EBA negotiations,21 and there was to me never - nothing mentioned about any22 sponsorship about MUA events. And I remember very well23 that we did make a shake - we did make a deal in that we24 had the heads of agreement, you know, we agreed what the25 heads of agreement was, for how we would write the EBA.26 And then Chris came - oh, sorry, Mr Cain came with the27 story, "Oh, Martin, we also have state conferences, and28 everybody is sponsoring that, so you should also." It was29 after we agreed on the heads of agreement. How could that30 now be the case? When he speaks about "everybody",31 I really had in my head that it was four of us, because,32 yes, I'm a major - Van Oord is a major dredging operation.3334 Q. Who are the other three?35 A. The other three is Dredging International, Boskalis36 and Jan De Nul. I was really - I live really in the world37 of dredging. So I thought - when he said the other ones38 are also sponsoring, I thought it was the other three.39 I never realised that also other operators also did. And40 then I asked, and he said, "Yes, the other ones commit to41 X times for $50,000." I said, "I'm not going to commit for42 X times $50,000." I said, "What kind of ballroom are you43 hiring, then?" He said, "We are, because people are coming44 there and getting there" - I said, "Yeah, if everybody is45 sponsoring, four of us, level playing field", I found46 $30,000 reasonable, so that is what we sponsored, $30,000.47 And then later, a year later, again that question came and


1 it came, I think - the HR manager and he said, "Since when2 are we sponsoring? Do we do that?" Then somebody said,3 "Yes, we did that last year as well", and they asked me,4 "Do we do it this year again?" "Yeah, why not?"56 Q. When you say, "Why not?", you say paragraph 1027 Van Oord didn't receive any benefits from making the8 contributions?9 A. It's sponsorship.1011 Q. But what did you get for your sponsorship?12 A. You don't get anything for sponsorships. I also13 sponsor, for example, the Dutch school in Brisbane.14 I don't get anything for it. I also sponsor, for example,15 to put a sign that the Duyfken arrived in Mapoon, so if you16 go to Mapoon, you see a sign that the Duyfken arrived17 there.1819 Q. What arrived there?20 A. How do you call it? Remember that site we sponsored21 that the Duyfken - the Duyfken is a vessel that came to22 Australia. We also sponsored the Duyfken, for example.2324 Q. These are charitable sponsorships you're talking25 about - a Dutch school, for kids to go and, what, speak in26 Dutch, is it?27 A. Yes.2829 Q. And this is to remember a particular vessel. What's30 the rationale for sponsoring the MUA state conference?31 A. There is no rationale.3233 Q. It is just to develop good relations with the MUA, is34 it?35 A. I saw merit in it because they said that it was an36 opportunity to get everybody on the same place and they37 could tell things about the industry. It was fine with me.3839 Q. You're not able to point to any other benefit which40 flows to your company from making those contributions?41 A. No, but maybe I may say something on this subject?4243 Q. No, you can answer my question. In paragraph 107, you44 say:4546 ... Van Oord made a donation of AUD $30,00047 to the Hasluck Election Campaign fund.


12 Mr Adrian Evans was the Federal candidate, you say, for the3 seat of Hasluck and you knew that he was Deputy State4 Secretary of the WA Branch?5 A. Yes. He was not re-elected again. That's how they6 told me, yes.78 Q. In paragraph 113, you say that you didn't think the9 donation was appropriate. Why do you say that?10 A. My colleague came back with the story that he was11 approached by Chris after a meeting or he was willing to12 donate. Oh, sorry, Mr Cain. He said yes, so then he came13 to me and said, "I promised $30,000 to sponsor for somebody14 in Hasluck." So I asked him --1516 Q. Well, it's not just somebody, is it?17 A. Sorry?1819 Q. It's not just somebody; it's the Deputy State20 Secretary of the WA Branch?21 A. Yes, which - yes. I didn't know him, but, yes, I know22 he was, yes.2324 Q. Go on. He told you that he agreed to sponsor him.25 Yes?26 A. That's why I asked him, "What's the sense of it?" He27 returned with, "You sponsored the Duyfken and all the other28 things. Also no sense." Then I explained to him that29 I read in the paper, if you read in the paper, there was a30 lot of fuss in the paper about builders giving money to31 political parties. He said, "It seems to me rather stupid32 that we're doing that now." We came to the conclusion that33 we were not really a builder and that, if at all we would34 sponsor, it would never be Labor. So, yes, to be honest,35 I could have stopped it at that moment. I could have said,36 yes, we don't do it, but --3738 Q. You said that Mr Pol had been having a meeting with39 Mr Cain, is that what you said, when he came to see you?40 A. I know that he met him somewhere, yes.4142 Q. What was that meeting about?43 A. I think it was in Sydney, and I think it was about44 manning levels, I think.4546 Q. Such as what?47 A. You have to agree on, if you start a new project, what


1 the manning levels are.23 Q. So it was about industrial issues?4 A. No, it was not really. We don't industrial issues, to5 be honest.67 Q. With the MUA?8 A. No.910 Q. No. Well, is that because of the generosity that you11 show in making these donations?12 A. No, it's more due to faults of our own. I sincerely13 think from all the unions who raise issues - because it is14 not only the MUA; also the engineers and officers raise15 issues, but to be honest, then I get very excited site16 people and say that there is an issue, but, to be honest,17 for the 100 times an issue comes up, 99 times, I think,18 yes, there is merit in it. So my policy was a little bit19 let's better do our job good. Then you never have20 industrial issues.2122 Q. He'd been having a meeting with Mr Cain, and no doubt23 others, about work matters, if I can put it that way,24 manning levels and the like, and it was during the course25 of that meeting that this came up, did it?26 A. No, he said it was afterwards. Similar as what27 happened with that sponsorship. I remember that the28 sponsorship which came up was really after we finished all29 negotiations about the EBA; then Chris came, "Now we have30 to do sponsorship. Now we have to do it. The other ones31 are also doing sponsorship." So my colleague said it came32 totally after the meeting.3334 Q. After the meeting?35 A. Yes.3637 Q. But you decided to pay it, anyway?38 A. Yes, which was rather stupid, I get the feeling, but39 I did, yes.4041 Q. It is a bit of a problem, isn't it, for the union, for42 this to be coming up at a meeting where you're talking43 about manning levels, and the like, or straight afterwards?44 A. I object.4546 Q. You object, do you?47 A. It was after the meeting. You suggest now that it was


1 during the meeting, but I told you twice already it was2 after the meeting.34 Q. All right, after the meeting. That didn't cause you5 any concern - that straight after the meeting, this came6 up?7 A. Why?89 Q. Why? You can't see any problem with that --10 A. No.1112 Q. -- is that your serious evidence?1314 MR STOLJAR: Oh well. Nothing further, thank you15 Commissioner.1617 THE COMMISSIONER: Mr Crawshaw?1819 <EXAMINATION BY MR CRAWSHAW:2021 MR CRAWSHAW: Q. Just a couple of questions, Mr Meijers.22 I appear for the MUA and Mr Cain and Mr Crumlin. Have you23 got your statement there?24 A. Yes.2526 Q. Could you just go to paragraph 35. You say you were27 advised by various parties that the AIMPE, the MUA and the28 AMOU did not want to meet to negotiate the 2011 EBA on29 a cooperative basis. That could be read two ways: that30 all the unions didn't want to cooperate with your company31 or that the unions didn't want to jointly negotiate.32 I take it that it was the latter, they didn't want to33 jointly negotiate?34 A. I know this is a sensitive issue, so let me rephrase35 what I tried to explain here. I was told for the 2009 EBAs36 that three parties - Van Oord was discussing together with37 the engineers, the officers and the MUA, each for their own38 EBA, and I was advised that it was a mission impossible to39 get the three together on the table again. Let's put it in40 a nice way.4142 Q. Thank you. My next question is that at paragraph 4943 you said that you became aware that METL's reputation in44 the industry - and this is in 2011 - was that it operated45 a "slush fund" for the MUA. What was the basis for you46 making that statement about reputation in the industry?47 Did someone say to you that METL was operated as a slush

.29/09/2014 90 M P MEIJERS (Mr Crawshaw)Transcript produced by Merrill Corporation

1 fund?2 A. Does it surprise you that people thought that?34 Q. Well, my surprise is neither here nor there. I want5 to know who told you?6 A. In general speaking, and even, maybe, I don't know7 exactly where, but say up till a year ago, some people who8 don't know METL, the first reaction is, "It is a slush9 fund." Sorry, I don't want to offend anybody, but you hear10 people say, "Oh, METL is a slush fund for the MUA." That11 is how people speak about it in Australia. I cannot change12 that.1314 Q. But you can't identify any of the people who15 actually --16 A. No, because I hear it via via, you understand what17 I mean? And somebody tells me that he spoke with somebody18 and he says that it is a slush fund.1920 Q. In any event, you say that anyone that spreads that21 reputation is ignorant of the true operation of METL?22 A. Well, I get directly from the feeling in 2011. I came23 in in July. People were explaining me how it would work,24 or how it did work, and I figure that, for us, it was25 really a solution, because we did separate training for26 officers and engineers and we didn't really upgrade for27 IR tickets, which we needed, so I saw merit with it.2829 Q. On the basis of what you then found out, you reject30 the proposition that it is a slush fund?31 A. Yes, but I cannot judge for other people what they32 think.3334 Q. No. There's just one other thing I want to ask you.35 If you go to subparagraph 94(e), you make mention there of36 two $25,000 contributions to METL in December 2013 and37 January 2014. Do you see that?38 A. Yes, because that was when, to my opinion, the fund39 was transferred. Then already the WA fund was in40 transition to METL, so that was the reason why, instead of41 that invoice coming from the MUA, it came from METL. So42 that is why I knew that it was transferred.4344 Q. That's what I was going to try to clarify with you.45 At paragraph 99, you actually say that those two payments46 were paid to METL, but at paragraph 100, you say,47 "I believed this sponsorship with MUA" - it was really


1 a sponsorship with METL, if you're going to call it2 a sponsorship, wasn't it?3 A. No, when we initiated it, it was something from the4 MUA in Western Australia, only, say, by shortly before5 December 2013 the MUA, together with METL I presume - it6 may have also already been before I came on to the board,7 to be honest. When I was in a board meeting in December,8 then it was already going on. So at a certain moment, say,9 before November 2013, the MUA Western Australia and METL10 must have come to a consensus that that fund would be11 transferred to METL.1213 Q. So it was your understanding that it was originally14 going to be paid into the Western Australian Branch of the15 MUA; is that right?16 A. When it started, it was really a baby of the Western17 Australian MUA Branch.1819 Q. No, I'm not talking about METL. I'm just talking20 about this payment. Are you saying that at any time it was21 meant to go into the Western Australian Branch of the MUA's22 bank accounts?23 A. Yes.2425 Q. And then at some time before December 2013, it was26 agreed that rather than go into the Western Australian27 Branch of the MUA's bank accounts, it would go into METL?28 A. And that the part from the MUA which I already paid,29 that that would be transferred to METL. It would remain30 the Western Australian training school only under the31 umbrella of METL.3233 Q. You didn't pay anything into the MUA in relation to34 those $25,000?35 A. No, that went directly to METL.3637 Q. Yes, that's all I'm asking about.38 A. Oh, sorry.3940 Q. I just want to suggest to you that the talk about the41 training school is actually a talk about the MUA buying42 property for a training school?43 A. That had to do with it.4445 Q. Yes.46 A. That had to do with it, that they would buy property.47 That was for me already totally - where I was coming from,


1 really from, was the idea to have a training school, invest2 in Australia and make sure that in time that there was not3 much work - that those workers would upgrade to tickets for4 dogging and rigging and height. What was good for Van Oord5 was good for the industry, to my opinion.67 Q. All I'm saying is that the talk about the training8 school was about the MUA buying property for the training9 school?10 A. And they would rent it out to METL, yes. To be11 honest, yes, that talk is going on, but it is not finally12 decided yet in the board of METL. I don't know which --1314 Q. But that has - sorry. But that has been the15 discussion about the training school?16 A. Correct.1718 MR CRAWSHAW: Thank you.1920 THE COMMISSIONER: Does anyone else want to ask any21 questions?2223 MR KOSTOPOULOS: No, Commissioner.2425 THE COMMISSIONER: Thank you, Mr Meijers, for attending.26 You are free from further attendance and you are excused27 from the summons that brought you here.2829 THE WITNESS: Thank you very much, Commissioner.3031 <THE WITNESS WITHDREW3233 MR STOLJAR: Commissioner, the next witness is Mr Cain.3435 <CHRISTOPHER CAIN, sworn: [2.50pm]3637 <EXAMINATION BY MR STOLJAR:3839 MR STOLJAR: Q. Could you tell the Commission your full40 name?41 A. Christopher Cain.4243 Q. You're a resident of Western Australia?44 A. I am, sir.4546 Q. You're the Branch Secretary for the Western Australian47 Branch of the MUA?

.29/09/2014 93 C CAIN (Mr Stoljar)Transcript produced by Merrill Corporation

1 A. Yes.23 Q. You have prepared a witness statement dated4 25 September 2014?5 A. Yes.67 Q. Do you have a copy of it there with you?8 A. No.910 Q. Do you want me to give you one?11 A. Yes. Thank you.1213 Q. Take a moment to look through it if you need to, but14 is the content of your statement true and correct?15 A. Yes.1617 MR STOLJAR: I would ask that Mr Cain's statement be18 received into evidence, Commissioner.1920 THE COMMISSIONER: That will be received into evidence.2122 #STATEMENT OF CHRISTOPHER CAIN DATED 25/09/20142324 MR STOLJAR: Q. Could I ask you to have a look at25 paragraph 12. The "vessel rolling fund" - just to26 understand it a little bit better, that's obviously money27 raised on that particular vessel or on that particular28 voyage, is it?29 A. On the vessel, yes, sir.3031 Q. I'm sorry?32 A. Yes, sir.3334 Q. Yes, that's on a voyage?35 A. Yes.3637 Q. How does it actually work? Who decides what the38 contributions will be and who collects them?39 A. Our members decide, who are on that vessel, where they40 put them contributions.4142 Q. Is there a vote or something?43 A. Yes, they've got rolling fund books on there, and then44 it could go, for example, to the children's hospital. It45 could go to the Kids For Cancer. It could go to motor46 neurone diseases. We're very good, our members, with47 charities, and it could come down then to the branch, to


1 the special purpose.23 Q. Is there a vote at the end of the voyage or something?4 A. They vote. Depending on how long the vessel is there,5 they take minutes; they have meetings; they then decide6 where the money goes.78 Q. Paragraph 17. You're dealing there with sponsorship.9 Have you been hearing the evidence so far today?10 A. Yes, sir.1112 Q. I won't, as it were, start from scratch. I'll assume13 you've heard a fair bit of it. We know that Sapura, for14 example, paid certain amounts of money by way of15 sponsorship. It paid the $50,000. You've heard, for16 example, Mr Di Giorgi say that that was to get good17 relations and I think he used the expression "calm" the18 employees. Do you agree with that characterisation?19 A. Not necessarily. We have a good relationship with20 lots of employers.2122 Q. But he said it was to calm down industrial unrest23 among some workers at least. Do you accept that?24 A. I can say this to you, sir, that the MUA treats every25 employer the same. And if you're suggesting through the26 question that there was some type of thing with27 SapuraClough or something from me, every employer is28 treated the same.2930 Q. That's what you wish to say in response to what31 Mr Di Giorgi said?3233 MR CRAWSHAW: I object to this. I think my friend is34 putting a bit of a gloss on what Mr Di Giorgi said. If he35 wants to cross-examine by reference to Mr Di Giorgi's36 evidence, he should go back and put it all. I think I saw37 this come up the other day in the CFMEU hearing.38 Commissioner, you suggested he not do it by reference to39 another witness but, rather, put propositions independent40 of what the other witness said.4142 MR STOLJAR: I can do it that way. This hasn't proceeded43 by way of exchange of statements, so Mr Cain hasn't had the44 opportunity to answer some things directly and I was trying45 to give him that opportunity if he wished to take it.46 Perhaps I'll do it this way.47


1 Q. I will do it step by step, Mr Cain, since the2 objection has been taken. It will be a bit slower, but3 anyway. Did you have a meeting with Mr Di Giorgi,4 Mr Bressani and Mr Tracey in May 2012 to discuss crewing of5 foreign crews on tugs?6 A. Yes.78 Q. If I suggest to you it occurred on 14 May 2012, does9 that sound about right?10 A. If that's what it says. I'm not sure.1112 Q. It was at Clancy's Restaurant in City Beach; does that13 sound right?14 A. Yes.1516 Q. The four of you were there, and there were17 negotiations around the number of people to be trained and18 the amounts involved?19 A. There was - well, when I say that, we discussed the20 project.2122 Q. This is the DomGas pipeline?23 A. Yes.2425 Q. There had been a few earlier meetings with yourself26 and Mr Bressani?27 A. I think there was one.2829 Q. Did you suggest that Sapura finance training of four30 people for an amount of $77,000 each?31 A. Firstly, I objected to foreign crews. They're32 obviously taking Australian jobs on Australian projects33 where there are Australians, if we could get Australians34 available for work who pay taxes in this country. So35 obviously, you know, I disapproved of bringing in foreign36 labour.3738 Q. Did you make that proposal, that Sapura finance39 training of four people for an amount of $77,000 each?40 A. There was talk about how we could deal with the issue,41 and one of the ways of dealing with the issue, because it42 was a short-term job, was for them to leave something when43 that job finished for training young Australian kids, and44 I think that's a good thing.4546 Q. Did you ask them to sponsor $50,000 towards an MUA47 conference?


1 A. Yes. The $50,000 for the conference sponsorship was a2 range of things. It was obviously to train the people that3 came in occ health and safety, indigenous issues,4 indigenous awareness, White Ribbon - you know, lots of5 things the company would have got out of there, and I've6 got to tell you, quite clearly, it's also about people7 being aware of seagoing - when they go to sea, in respect8 to suicide that's going on at sea and making them aware.9 You know, so there was a lot - the company got a lot out of10 it in respect to them people going on the job and the11 trainees going forward.1213 Q. Do you have two folders there?14 A. Yes.1516 Q. Can you have a look at volume 2?17 A. Yes.1819 Q. Page 395. That's a letter you sent the next day to20 Mr Bressani?21 A. No, he sent one to me. Oh, 395?2223 Q. Page 395.2425 MR CRAWSHAW: It doesn't mean much, saying "the next day"26 when we haven't got to the previous day.2728 MR STOLJAR: I thought he had agreed that it was about29 14 May.3031 MR CRAWSHAW: Well, that was a while ago.3233 MR STOLJAR: Q. The day after the breakfast meeting was34 all I meant, Mr Cain. That's a letter you sent the day35 following the breakfast meeting?36 A. Yes.3738 Q. You attached an invoice for $50,000?39 A. Yes.4041 Q. Then at page 399, he sent you an email on 21 June?42 A. Yes.4344 Q. He attached an MOU, which you signed in due course.45 Just looking at the email, he says in the penultimate46 paragraph:47


1 ... I am delegating my authority to2 Fabio ...34 That's Mr Di Giorgi. Please read through the first part of5 the email, if you need to, to put it in context.67 Our word is what count. Help us to have a8 good project and we will honour our words.9 We need a very smooth execution. We need10 to improve productivity if we want to make11 money.1213 When he says, "We need a smooth execution. We need to14 improve productivity", he's saying, "We don't want any15 interruptions on the site"?1617 MR CRAWSHAW: I object.1819 MR STOLJAR: Q. To your understanding?20 A. That's not correct.2122 Q. He told you earlier on:2324 The project is very difficult and we25 already lost few millions ...2627 A. Yes, I'm not interested in that, really.2829 Q. You're not interested?30 A. I wasn't interested in what he'd said about losing31 millions. My view is I don't treat any employer any32 different in respect to projects.3334 Q. What's that got to do with what I was asking you?35 What I was asking you was, he says:3637 Help us to have a good project and we will38 honour our words. We need a very smooth39 execution. We need to improve productivity40 if we want to make money.4142 You understood him to be saying, I suggest to you, "We43 don't want any interruptions. We don't want any industrial44 unrest"?45 A. I've got to say to you, if there was a safety issue on46 board that vessel, or any other vessel, and it was47 requiring attention, then regardless of what he's saying


1 there, it would be attended to, whether it is taken to2 Fair Work Australia or anywhere else.34 Q. Do I take it from that answer that you accept that you5 understood him to be saying to you on 21 June, at 1.33pm,6 regardless of what might happen in the future, that he7 wanted the project to operate smoothly with no industrial8 unrest?9 A. And so do we. We wanted --1011 Q. You agree that that's what he was saying to you?12 A. Well, I don't know. That's what you're saying he's13 saying there, but what I'm saying is we want the jobs to go14 well as well. I mean, there is employers who we do get on15 with.1617 Q. Yes. Page 400 is an MOU. They were suggesting to18 break up the $50,000 into two tranches and you were content19 to go along with that?20 A. Fine.2122 Q. Similarly, the training money was to be broken up into23 two tranches. And at point 7 he says:2425 ... funds ... shall be applied solely and26 exclusively to sponsor the MUA27 State Conference ...2829 If you come through to page 428, you wrote on30 September 2012 and you thanked them for their contribution31 and you say that the money had been used to sponsor these32 two particular conferences, in 1 and 2. You didn't use it33 for the state conference, you used it for those two34 conferences?35 A. No, we used it for conferences, yes, all conferences.3637 Q. Where do I draw that from?38 A. Well, it looks like you're drawing it from that letter39 there or the previous letters, but I'm sure the40 conversation I had with him was for all conferences.4142 Q. All conferences?43 A. Yes.4445 Q. All right. You say, as far as you were concerned, he46 wasn't sponsoring any particular conference?47 A. Yes, but in that letter you'll see --


12 Q. Which one - the one on page 428?3 A. Yes. Yes. You'll see quite clearly FPSO conference,4 skills set, indigenous and women's issues, NOPSEMA, safety5 reps, occ health and safety, the offshore divers, both of6 them conferences would be where - in the offshore oil and7 gas, so you're aware, their members would possibly go on to8 work on them other ships what they were on, so that's why9 it was - they're sort of linked together.1011 Q. MUA members?12 A. Yes.1314 Q. Would you have a look in that same volume at page 488.15 That is a letter that you sent to Mr Vermeulen in respect16 of the sponsorship by Dredging International of the state17 conference. They had agreed to pay $50,000 for four years.18 That is to say, $200,000 in total - you say that in the19 second paragraph - for a four-year period, 2012 to 2015.20 By the way was this discussed with Dredging International21 as part of the negotiations for the EBA?22 A. No.2324 Q. Did you say to them, when negotiating the EBA, that25 everyone in the dredging industry was paying sponsorships26 of this kind?27 A. Not at all. Over the process of the dredging EBAs28 they were done individually, so for each of the four29 dredging companies they were done individually and it's at30 different times. Certainly, they had an EBA or a dredging31 EBA and then there was a discussion about sponsorship for32 the conference.3334 Q. When you were negotiating the Van Oord EBA, you put to35 them that the other dredging companies were all kicking in36 $50,000; correct?37 A. No, it wasn't.3839 Q. And that's how --40 A. That's not correct.4142 Q. That's how Mr Meijers came to agree to pay $30,000.43 He said he wouldn't pay $50,000, he would pay something44 else?45 A. Yes, there was a discussion with them, but I mean46 different companies pay different, depending on how many47 people were on the job, how big the jobs were, in respect


1 to what had gone on.23 Q. Did you say something similar to4 Dredging International, that the other companies were5 kicking in money for the state conference and they should6 too?7 A. No. I explained what the state conference was about8 to each and every one of them individually.910 Q. You may have done, but why don't you answer my11 question? Did you put to Dredging International that the12 other dredging companies were kicking in for the state13 conference and they should too?14 A. I just no; I said no to you, sir.1516 Q. You said no. The fact that you wrote this letter the17 day after the EBA was approved, that was just coincidental,18 was it?19 A. Very coincidental.2021 Q. Just complete coincidence?22 A. Just complete coincidental.2324 Q. It must have been connected with the EBA discussions,25 Mr Cain, it can't have been a coincidence?26 A. I'm sorry you think that but I was there and you27 wasn't and I've already answered the question.2829 Q. That's true. Dredging International obtained no30 appreciable benefit in exchange for its sponsorship, do you31 agree with that?32 A. No, I don't.3334 Q. And Van Oord obtained no benefit whatsoever from its35 sponsorship of the conference. Do you agree with that?36 A. I don't.3738 Q. In the 2012 year Sapura had paid a sum of money,39 $50,000, Dredging International had agreed to pay $200,000,40 although only $50,000 related to 2012 and Van Oord had41 agreed to pay a sum of money as well; so you had obtained42 sponsorship of the state conference from all those43 entities. Who else?44 A. There was lots of companies.4546 Q. Lots of companies?47 A. Yeah.


12 Q. And they were all agreeing to sponsor your conference?3 A. Yes, because they see the benefits of it.45 Q. The benefit is they get good relations with the union?6 A. I'm not sure whether they get good relationships with7 the union. They understand that when we have a conference8 and an international conference at that, even though it's a9 state, they are people from all over the world, they share10 their experiences, they talk about occ health and safety,11 they talk about issues on the job, where they may be going12 to the next job. They talk about skill set and safety and,13 you know, charities, what they want to donate to. There's14 lots of thing they talk about and there's lots of things15 that the company get out of the sponsorship.1617 Q. You go on in your statement to talk about commissions18 paid by Protect: that's at paragraph 18. Protect is, as19 you say, the income protection fund. Those commissions are20 deposited into the WASP. You say this in 18, that your21 EBAs identified Protect as the income protection fund?22 A. Yes.2324 Q. Or at least the dredging ones do?25 A. Yes.2627 Q. Do other ones?28 A. Yes, there is another one down at the AMC in29 Henderson.3031 Q. That's a Commission paid from Protect to the MUA, is32 it?33 A. Protect. Yes, it's in the EBA.3435 Q. The fact that Protect is chosen is in the EBA. Is36 there a disclosure of the fact to the Commission?37 A. Yes. All over the place.3839 Q. I'm sorry?40 A. Yes, it's everywhere.4142 Q. Everywhere?43 A. We don't hide that. You can actually see, if you look44 through the 47 boxes you've got, we sent over to you, it45 was in there. Quite clearly, in our newspaper, in respect46 to commissions.47


1 Q. In a newsletter that's sent out?2 A. Not only in the newsletter. I've got to tell you, the3 employers knew about it as well.45 Q. How did they know about it?6 A. Well, it's in the newspaper and they get the7 newspaper.89 Q. Is that the only place it's disclosed?10 A. No, no, it's disclosed in the brochure that goes out11 to the members on board the ships, it's disclosed at12 stop-work meetings, it's disclosed at ship-board meetings,13 it's disclosed down on the dock, it's disclosed everywhere.14 We make no secret that there is a commission coming back to15 the benefit of the members.1617 Q. But what about the employers? I can understand you'd18 send the newsletter. You say that goes to members and it19 may be disclosed to members. What about the other parties20 to the EBA?21 A. Well, I can tell you that I walked into an AMMA office22 to a meeting and as soon as our newspaper was out, you23 wouldn't believe it, they had it on their computer screen24 up and they were actually looking at Protect. So,25 you know, they had - the industry group for the employers,26 I've had many employers come back to me in respect to27 understanding Protect. There's nothing wrong with Protect.28 It's an insurance for our members, what we're happy with29 and they're happy with and they voted unanimously on it.3031 Q. Do you disclose the quantum or the percentage?32 A. We disclose that there is a commission.3334 Q. I just want to ask you a bit more about the WASP fund.35 I just want to understand it a bit better. Could I show36 you these.37 A. Thank you.3839 Q. Just so you understand, Mr Cain, these aren't your40 documents. These are documents that were prepared by41 accountants working for the Commission and they have looked42 at the accounts and tried to summarise them rather than43 wade through a whole lot of stuff.44 A. Okay. No problem.4546 Q. The first few relate to pages relating to METL.47 I won't even take you through those, I think. Could we


1 just come to WASP profit and loss. Do you see the folder2 pages, bottom right, there is some numbering? It's 5.3 A. Profit and loss.45 Q. I just want to look at income first to the WASP. The6 third line is "Donations Received". That's donations from7 companies like Sapura, Dredging International and the like?8 A. Sorry, sir, which page are we on here?910 Q. Page 5, if you look at the bottom right-hand corner.11 Keep coming through. I will see if Mr Molan can assist you12 finding the right page.13 A. Yes.1415 Q. It's WASP?16 A. Yes.1718 Q. This is the P&L, profit and loss. It says19 "Profit & Loss Summary. Income", in the left column,20 "Donations Received" and one can see that the bulk of the21 income is donations. That is from companies like Sapura22 and Dredging International and the like?23 A. No, that's not right.2425 Q. No. Who are the companies?26 A. They're donations that come from our members and27 you've already articulated that yourself, the way of28 rolling funds; we would get thousands and thousands of29 dollars from our members.3031 Q. There's a break-down of donations we can come to, but32 I'm just trying to understand if that line - for the 201333 year, $807,000, that would include, I'm not saying it's34 limited to it, donations from companies like Sapura and35 Dredging International?36 A. Yes.3738 Q. And then levies received is the other significant one,39 271; that's levies on members allocated for specific40 purposes?41 A. Levies over and above their union dues that get42 articulated back to our branch.4344 Q. Yes, and I think you have covered that in your45 statement?46 A. Yes, you see that, yes.47


1 Q. This all goes into the one account?2 A. Yes.34 Q. And then if one looks at "Expenses", the largest item5 is "Conferences"; for the 2013 year that's $309,000?6 A. Yes, that's what we paid for the conference.78 Q. And then "Donations" is probably the next largest,9 that's $135,000, and I think we've got a break-down of what10 - if you come through to page 13, if you look at the bottom11 right-hand corner, there is some numbering.12 A. Yes.1314 Q. That's a list of all the donations.15 A. Yes.1617 Q. For example, 28 May 2013, an ALP branch donation is18 one of the large ones. I'm just trying to pick up the19 larger ones, so that's one, and then the next largest is20 18 April 2013, that's the donation for the21 Hasluck campaign; so that would be Mr Evans.22 A. Yes.2324 MR CRAWSHAW: I don't know whether my friend is suggesting25 the ALP is a special entity in terms of the Terms of26 Reference. It was established by the union movement,27 I think, before the predecessors to this union was set up.2829 THE COMMISSIONER: I remember that.3031 MR STOLJAR: Q. In any event, this is the money that32 flows out that's allocated as donations --33 A. Yes.3435 Q. -- or accounted for as donations. If we come back to36 the P&L, there are quite a few expenses which are really37 just, I suppose, branch expenses; is that a fair way to38 describe them?39 A. Yes.4041 Q. Is this the position; that the funds come in as42 sponsorship of the state conference, it goes into this one43 account and then funds flow out again, some of which are44 just used for day-to-day expenses of the branch?45 A. Yes, of course, you know, maintenance, all kinds of46 things.47


1 Q. And groceries and that sort of thing?2 A. Groceries.34 Q. So the Coles, et cetera, is just groceries, I take it?5 A. Yes, but you've got to understand, in respect to that,6 and I thought you might bring that up, but our stuff is7 audited --89 Q. Which one do you want me to --10 A. No, you just brought up Coles expenses or something.1112 Q. Oh, Coles, yes.13 A. I'm quite happy with that.1415 Q. That may be, but I'm just trying to work out where it16 goes. It goes into this account?17 A. Yes.1819 Q. And then that gets used for day-to-day expenses of the20 branch?21 A. Yes.2223 MR STOLJAR: Commissioner, I tender the bundle of24 financial documents.2526 THE COMMISSIONER: That will be admitted as Cain MFI-1,27 subject to the right of any legal representative to object28 later.2930 MR CRAWSHAW: Might we also have leave - our forensic31 accountant hasn't analysed it completely but there's the32 possibility that there might be a short analysis.3334 THE COMMISSIONER: A responsive-type document?3536 MR CRAWSHAW: Yes.3738 THE COMMISSIONER: Yes, you have that leave. How long do39 you want? Maybe you don't know.4041 MR CRAWSHAW: Until the end of next week would be42 sufficient.4344 THE COMMISSIONER: Yes.4546 CAIN MFI#1 BUNDLE OF FINANCIAL DOCUMENTS47


1 MR STOLJAR: Q. Mr Cain, I think you touched on this2 when you said the accounts were audited. This account, the3 WASP account, is that - let's take it in steps. That's4 audited, is it, by external auditors; is that right?5 A. Yes.67 Q. Is it part of the accounting records of the branch or8 is it kept separately?9 A. No. The accountant --1011 Q. It's all in the one?12 A. Yes, of course.1314 Q. Can I ask you a bit about the training fund?15 A. Yes.1617 Q. There's one anomaly in your statement, Mr Cain. The18 numbering is all a bit out of whack. In paragraph 47, for19 example, we get up to 45 and then it starts again at 42.20 A. Okay. Sorry about that.2122 Q. It's no problem. I just don't want any confusion.23 When I say go to paragraph 43, I mean the one on page 8.24 A. Yes.2526 Q. At least at the top of page 8. There is another 43 in27 the middle of the page, but if you start there. The28 training fund is now closed.29 A. Yes.3031 Q. At paragraph 44 you say that, in addition, some32 dredging companies elected to contribute money to the MUA33 Training and Development Fund on the basis that the moneys34 would be used to undertake training activities. Would you35 come back to volume 2, page 496. You wrote to Mr Vermeulen36 on 25 March 2013 and you attached invoice 865. That is an37 invoice for $169,000-odd. Had you had discussions with38 Mr Vermeulen leading up to that?39 A. In respect to what?4041 Q. In respect of your letter and sending an invoice?42 A. I'd spoken to Mr Vermeulen - and all the dredging43 companies - about how we could work together in the44 long term to establish training for Australians in their45 own country. These dredging companies come and go and we46 had a number of discussions of how we could leave something47 not for the union but back in Australia, whether it be a


1 school, so that kids could go through a full career path2 and it wasn't just with Mr Vermeulen. I done that with3 actually AMMA, their representatives and a number of4 companies.56 Q. Were other companies also contributing in 2013 to the7 training fund?8 A. Lots of them do, yes.910 Q. The training and development fund, I should say.11 A. Yes. Yes.1213 Q. You attached an invoice and you said:1415 Support for training and development will16 assist us in the delivery and convening ...1718 And you have a number of things set out. And then on19 4 June you send another letter, it is on page 500, which is20 in very similar terms. You were seeking, in both letters,21 support for the state and national MUA conferences?22 A. Yes.2324 Q. If you come back to 25 March, let's just look at that25 one on page 496, the fact is that Dredging International26 have already paid $200,000 the previous year for the state27 conference?28 A. Yes.2930 Q. They were agreeing to pay, both on 25 March and on31 4 June, further money for the state conference?32 A. I think that's great.3334 Q. Is that right?35 A. I think it's great that they want to get involved in36 the --3738 Q. You think it's great, did you say? I'm sorry,39 I misunderstood.40 A. I think it's good, yes.4142 THE COMMISSIONER: You said in the previous year they'd43 paid $200,000. Was it paid or promised?4445 MR STOLJAR: It was paid, I think, Commissioner. I think46 they paid it in one lot. The invoice is on page 489.47


1 THE COMMISSIONER: Yes, I see. The letter says "your2 anticipated sponsorship of $200,000 for the four-year3 period", but they didn't pay in instalments; they paid at4 the beginning.56 MR STOLJAR: Yes, I thought that was the case. We will7 check the accounting records and see if we can shed any8 light on that, Commissioner. In fact, if I take you,9 Commissioner, to the financial documents and one goes to10 page 6, in the bottom right-hand corner, there's an entry11 of 12 July 2012 marked "Sponsorship of WA State12 Conference", credit amount of $213,372, which is invoices13 800 and 806. 806 is the one for $200,000.1415 THE COMMISSIONER: Where does the $13,372 come from?1617 MR STOLJAR: That's at page 483 and that's reimbursement18 of the travel expenses associated with the EBA19 negotiations.2021 THE COMMISSIONER: Thanks.2223 MR STOLJAR: Q. Dredging International obtained no24 appreciable benefit from the making of those payments,25 those two lots of $169,000; correct?26 A. No.2728 Q. The only benefit that they obtained was alleviating29 industrial unrest?30 A. You keep asking me that and I keep saying the same31 thing, but if you can tell me what industrial unrest they32 had on that project, please tell me. Enlighten me.3334 Q. That may be the case, that they got what they paid35 for.36 A. What do you mean might be? I don't talk about might37 bes. It's certainly not the case.3839 Q. In 46 you deal with transfer of funds to METL: that's40 46 of your statement. You say that $580,000 comes from the41 training fund and goes to METL. I am talking about the42 "46" at the bottom of page 8, Mr Cain.43 A. Oh, sorry.4445 Q. It is the second 46 on page 8. I am just trying to46 sort out the sequence of events. On 19 February 201447 you've got an amount of $580,000 that comes out of the


1 training fund, goes into WASP and then goes to METL; is2 that right?3 A. Yes.45 Q. It may be that nothing much turns on it, Mr Cain, but6 why go to WASP and then to METL; why not straight to METL?7 A. Well, I'm not sure. I think we just used to go -8 everything used to go through WASP, not for any particular9 reason, but I will say this, sir, every bit of money that10 goes in or comes out is there for the right purposes, so if11 you're asking --1213 Q. No, I was actually just trying to see why it went in14 that way.15 A. Okay. All right.1617 Q. But it may be that nothing turns on it. A further18 amount of $447,000 from WASP was paid to METL?19 A. Yes.2021 Q. In fact, maybe one needs to look at (ii) before (i),22 if that makes sense. On 18 February 2014, $600,000 is23 transferred from the training fund to WASP.24 A. Yes.2526 Q. Along with the amount of $580,000?27 A. Yes.2829 Q. Does that mean that a total amount of about30 $1.1 million was transferred out?31 A. Yes.3233 Q. Is that right?34 A. (Witness nods).3536 Q. I am going to ask you some more questions about a37 spreadsheet, Mr Cain. Page 18. I will tell you what the38 issue is and it may be that you can answer on the spot, but39 it may be that the forensic accountants that your counsel40 has referred to would be better placed to give an answer,41 in which case just say, "They'll have to deal with it",42 okay?43 A. Yes, sure.4445 Q. If that's not something you can deal with on the spot.46 If you come to page 18 --47 A. On?


12 Q. In the green folder?3 A. Oh, okay. Yes.45 Q. Our accountants, looking at it, and looking at your6 paragraph 46 on page 8, at the bottom of page 8, have come7 up with invoices paid to METL of $1,027,870, which I think8 reflects the two figures you've got in your (i), $580,4709 and $447,000.10 A. Yes.1112 Q. And then there's an amount of $145,990 which appears13 to be moneys that were paid in by employers for training14 and development into the Training and Development Fund but15 which hasn't gone to METL. In fact, it says there that as16 at 13 April 2014, there was no evidence of these amounts17 being remitted to METL. Are you able to shed any light on18 that, as you sit there now?19 A. No. We'd have to go and have a look. I couldn't tell20 you offhand, sir.2122 Q. But your understanding was that all the amounts23 contributed for training and development have gone across24 to METL?25 A. No. Some of it had stayed in special purpose.2627 Q. I thought you'd said in your statement, Mr Cain -28 I may have got this wrong - that all of the training and29 development money had gone to METL?30 A. No.3132 Q. No? Some had stayed?33 A. Yes.3435 Q. This is where I've got it, Mr Cain. Page 507. It is36 not in your statement, I'm sorry, it's page 507 of the37 bundle. That's a letter to Dredging International?38 A. Yes.3940 Q. The first paragraph we don't need to take up time41 with. The second paragraph:4243 The MUA WA Branch is in the process of44 transferring all contributions made for45 training and development to the ... [METL].46 This is a not-for-profit company jointly47 established ...


12 Et cetera, et cetera. Your understanding is that some of3 the contributions are still in the Training and Development4 Fund?5 A. No, the Training and Development Fund is closed.67 Q. I'm sorry, in WASP?8 A. In WASP, yes.910 Q. Is it the intention that that money will go across to11 METL or do you have no --12 A. No. It all depends. See, a lot of our people put in,13 our own members put in, but I think some of that money will14 be used - I'm just going off the top of my head here, but15 I think it will be used for the training school. I haven't16 had any complaints back from the employers about that17 either.1819 Q. About it going to METL?20 A. No, no, about it going towards a training school. All21 the discussions we've had with the employers is basically a22 non-profit organisation where the employers and the23 employees get benefits from a training school and, you24 know, we want to - when I eventually leave the union I want25 to leave something behind for the Australian kids and to26 give them a career path.2728 Q. Just coming back to page 18 in the spreadsheet on that29 page, can I just ask you this: if you have your30 accountants, when they're preparing something in reply by31 the end of next week, if they could just say whether they32 agree with those calculations or not?33 A. Yes, sir.3435 MR CRAWSHAW: Or if they don't, we'll just make an36 agreement anyway.3738 THE COMMISSIONER: I didn't quite catch that.3940 MR CRAWSHAW: I was just saying if we don't put a41 statement in from the accountants, we can do that just from42 my instructing solicitor.4344 THE COMMISSIONER: Yes.4546 MR STOLJAR: Q. I just want to ask you a bit about the47 establishment of METL. Can you have a look at volume 1.


1 Why don't we start with page 270. You weren't at that2 meeting. Mr Doleman, Mr Bray and Mr Cushion were there for3 MUA. You're aware that discussions had commenced at about4 that time between Saipem and MUA and the issue was crew of5 foreign tugs?6 A. This is with the Saipem stuff?78 Q. Yes.9 A. Yes.1011 Q. Come to page 272. Mr Crumlin writes to Mr Legrand and12 tells him, in effect, that METL has been set up and then if13 you come through to 274, this is a meeting in Fremantle and14 you've attended that meeting.15 A. Mmm.1617 Q. As I understand it, the barges were actually being18 brought to the AMC facility at about that time while the19 meetings were under way. Do you remember that one way or20 the other?21 A. No, I'm not sure if they were on their way down.2223 Q. If you come through to page 276, I'm sorry, that's24 actually between Saipem and ENI, but on 26 August they say,25 "Foreign crew currently in transit." And then come through26 to page 278, there was a meeting in Fremantle on 28 August27 2008. At that meeting it is said that you were steadfast28 in your rejection of foreign-crewed vessels. This record29 recites that the MUA - I'm looking at the first paragraph30 not in bold under the heading "Tugs":3132 ... MUA again made it clear that they would33 not accept foreign tugs entering AMC or34 Darwin and if this did happen they would35 take action to disrupt the Project supply36 chain and activities on the Project site.3738 That is the Blacktip Project and that's what you're saying39 at the meeting?40 A. No.4142 Q. You're saying that --43 A. No. Look, I certainly - my job is to maximise44 Australian content and there was - obviously, there was a45 heated discussion around that, but certainly I wouldn't46 have said to them in that meeting that we were going to47 disrupt the job.


12 Q. They have you recorded as saying that you wouldn't3 just disrupt the job, you would disrupt the project supply4 chain and activities on the project site?5 A. No, I disagree.67 Q. Come to 287. You had a meeting in Darwin with8 Mr Legrand. I think Mr Lindsay was there as well.9 A. 287, yes.1011 Q. You're really talking about what sum of money might be12 paid by Saipem, page 288. You wanted around $1 million;13 they said they were only ready to pay $750,000. Then you14 had a meeting with Mr Legrand on the ship, the Castoro 8.15 Do you remember that?16 A. Yes, vaguely.1718 Q. Vaguely? With him and the delegates?19 A. Not with Mr Legrand and the delegates, no. I would20 have met the delegates, my delegates and our members21 myself.2223 Q. Didn't you tell the crew and the delegates that24 considering all the efforts that Saipem were making, they25 had to work hard, deliver the project on time and "stop the26 bullshit"?27 A. I've always said that. If we can work with companies28 and they can work with us, I think that's a good thing.2930 Q. But the way they were working with you was moving31 towards making the contributions that you were seeking from32 them?33 A. Not at all. I've explained, Mr Stoljar, on numerous34 times to numerous companies about working together and how35 we could jointly, in a bipartisan approach, a social36 compact, if you want to say, work together so that when37 these companies leave Australia and they come back, that38 the skills will be there for Australians to do that work39 and I think that's a good thing.4041 Q. You then had another meeting in Fremantle on42 11 September: that's at page 294?43 A. 294. Yes.4445 Q. You got annoyed at this meeting about the hold up and46 closing out the training levy?47 A. No.


12 Q. No?3 A. No.45 Q. And the meeting became tense?6 A. The meetings were pretty tense anyway in respect to -7 when someone tells me they're going to bring in foreign8 labour at the expend of Australian labour when there's9 Australian labour there, meetings are always tense, but10 I've got to tell you - when was that meeting? 2008. I've11 worked as a union official for 12 years and I've got to say12 I worked with Saipem right the way through that, even when13 meetings are tense and even right now I'm just in the14 process of doing an MOU for the Inpex project where we're15 working constructively together, so to say that, meetings16 are tense and I work for the union, not for the company.1718 Q. About six weeks later you had a telephone conversation19 with Mr Legrand. Do you remember that?20 A. No, where's that?2122 Q. It's not an email that you would have seen. I'll just23 ask you about the telephone call. He says that you spent24 the whole time yelling and screaming?25 A. Well, I don't know whether there's a mix up. I think26 it was on the escrow. When it was all agreed, I think27 there was a mix up with the funds on our side and I think28 you'll find that if Mr Legrand was here, I'd apologise to29 him because it wasn't his stuff-up, it was ours.3031 Q. But you were demanding a meeting with ENI that day,32 otherwise the job would be shut down?33 A. Not at all.3435 Q. You deny that? You deny saying that?36 A. Yes. I certainly had a heated debate with him, but37 I have never said to Saipem that I would close the job38 down, ever. He may have heard members say it and I've had39 to calm members down, I don't know. I went out to the40 Castoro Otto. Actually, I thought I'd done a good job for41 both sides in respect of getting that project on time. We42 don't always argue. We've never stopped a job. We've43 never had any industrial disputes, so it's just a furphy,44 it's a nonsense.4546 Q. Can I ask you then about a later meeting. This would47 have been around about early November 2008, a breakfast


1 meeting with Mr Legrand?2 A. Yes.34 Q. I take that back. It was a telephone conversation5 again with Mr Legrand. It was about 7 November. You were6 annoyed because they'd gone to see Mr Crumlin or were7 having discussions with Mr Crumlin?8 A. I don't know. I think that's taken out of context.9 I get on very very well my National Secretary.1011 Q. I'm not suggesting you don't, but you were upset by12 the fact that they had gone to Mr Crumlin?13 A. I don't know about that. As I say, I get on - that's14 an external memo for them. Maybe they thought I was upset.15 I don't think I was. I always get on well with him. We're16 good mates.1718 Q. You said, in effect, "I don't care what you do with19 Paddy. I'm going to shut down this job. You'll see what20 happens on this rig." You said that to Mr Legrand?21 A. No, that's fanciful, that's fanciful, not at all.2223 Q. Just briefly, Mr Evans is the Deputy Secretary of the24 Branch?25 A. Mr Adrian Evans, yes.2627 Q. You sought that Van Oord make a contribution to his28 campaign expenses?29 A. No.3031 Q. You never asked them to?32 A. Yes.3334 Q. You did ask them?35 A. Look, it's up to them what they do. I ask a lot of36 people.3738 Q. Was that request communicated immediately following a39 meeting that you'd had about manning levels?40 A. No, no, I'd had meetings - there was a meeting and a41 general discussion and I wouldn't even know if it was about42 manning levels, I can't remember, but --4344 Q. Who was at the meeting?45 A. Myself and Herm Pol.4647 Q. So it was at the end of the meeting?


1 A. No. No. I can't - I can't actually remember, but it2 certainly wasn't in that discussion I had about anything3 else. What I did say to Mr Pol was, "Adrian Evans is4 running for the seat of Hasluck. Do you want to support5 him?" Now, you know, that's up to them if they support him6 or not. Like I'd go the unions and ask them for support,7 you know, I wasn't - it was neither here nor there to me.89 MR STOLJAR: I have nothing further, thank you,10 Commissioner.1112 MR NEIL: I wonder, Commissioner, if I might interrupt13 just to ask whether I might ask some short questions of14 Mr Cain so that Mr Crawshaw has the opportunity to hear15 them?1617 THE COMMISSIONER: Yes, certainly.1819 <EXAMINATION BY MR NEIL:2021 MR NEIL: Q. Mr Cain, I appear for22 Dredging International.23 A. Yes, sir.2425 Q. I wonder if you would be good enough to go to the26 bundle please and look at page 488.27 A. On which one?2829 Q. I think it's behind tab 4, whichever volume that is.30 A. Is it volume 2?3132 Q. It is volume 2, I think, page 488.33 A. Okay. 488. Yes.3435 Q. That's a letter written by you bearing the date of36 9 May 2012; is that right?37 A. Correct, sir.3839 Q. Do you remember you were asked some questions about40 that letter?41 A. Yes, sir.4243 Q. Would you be good enough to turn back to page 484,44 please.45 A. Yes, sir.4647 Q. You recognise that page to be a copy of the decision

.29/09/2014 117 C CAIN (Mr Neil)Transcript produced by Merrill Corporation

1 by which the Dredging International enterprise agreement of2 2012 was approved?3 A. Yes, sir.45 Q. And do you see that that bears the date of 8 May 2012,6 only the day before your letter?7 A. Yes, sir.89 Q. Do you remember you were asked some questions about10 the coincidence between those two dates?11 A. Yes, sir.1213 Q. You've been involved or participated in the processes14 of bargaining for and approving very many enterprise15 agreements, haven't you?16 A. Yes, sir.1718 Q. You regard yourself as having a deep experience of19 those processes; is that right?20 A. Yes. Oh, yes.2122 Q. An early part of those processes concerns the23 bargaining for the enterprise agreement; is that right?24 A. Yes.2526 Q. In the case of this enterprise agreement, the Dredging27 International 2012 enterprise agreement, the bargaining28 took place between the MUA and Dredging International; is29 that correct?30 A. Yes, sir.3132 Q. The MUA was acting as a bargaining representative in33 that process; is that right?34 A. Yes, sir.3536 Q. That bargaining concluded with an agreement between37 the MUA as a bargaining representative and the company; is38 that correct?39 A. Yes, sir.4041 Q. An agreement which settled the terms of the proposed42 enterprise agreement; is that right?43 A. Yes.4445 Q. Immediately after that the terms of the proposed46 enterprise agreement were put to the employees who would be47 covered by the enterprise agreement for their approval; is


1 that right?2 A. Yes.34 Q. That is, their approval under sections 181 and 182 of5 the Fair Work Act; is that correct?6 A. Yes.78 Q. And that process required the employees have time to9 consider the proposed enterprise agreement; is that right?10 A. Yes.1112 Q. And then there was a ballot; is that correct?13 A. Yes, there would be a ballot to accept it or reject14 it.1516 Q. In this case your recollection is, is it not, that the17 proposed enterprise agreement was approved by the employees18 by ballot; correct?19 A. Finished with, yes.2021 Q. Once the process of approval by the employees was22 complete, an application had to be made --23 A. To the Commission.2425 Q. -- to what was then Fair Work Australia for its26 approval; is that correct?27 A. That's correct.2829 Q. That was an application that in this case was made30 under section 185; is that right?31 A. Yes, sir.3233 Q. After that application was made, Fair Work Australia34 took time to examine the enterprise agreement; is that35 correct?36 A. Yes, sir.3738 Q. And only once it had done so did it approve the39 agreement under section 186; is that right?40 A. Yes, sir.4142 Q. The processes that I've just been asking you about43 took very many weeks to complete; is that correct?44 A. Yes, sir.4546 Q. A very long time passed between the date when the MUA47 and the company agreed upon the terms of the proposed


1 enterprise agreements and its approval by Fair Work2 Australia; is that correct?3 A. Yes, sir.45 Q. A time involving very many weeks at least; do you6 agree?7 A. Yes.89 MR NEIL: Thank you.1011 THE COMMISSIONER: Does anyone else want to ask any12 questions other than Mr Crawshaw? Mr Crawshaw.1314 <EXAMINATION BY CRAWSHAW:1516 MR CRAWSHAW: My learned friend has made my questioning17 shorter, actually.1819 Q. There are two areas I want to ask you about, Mr Cain.20 Firstly, the question of the training school that I think21 was mentioned in your evidence, and it was also mentioned22 in Mr Meijers' evidence, is it proposed that the MUA rather23 than METL buy property for the training school?24 A. Yes, sir.2526 Q. There was some talk about some moneys that were27 transferred from the training fund to the special purpose28 fund that didn't in turn go on to METL?29 A. Yes, sir.3031 Q. Do you remember you were asked about that and the32 accountants are going to have a look at that?33 A. Yes.3435 Q. Is it your understanding that the moneys that come36 into that category, namely, had their origin in the37 training fund, will be used to buy the property for the38 training school?39 A. Yes, sir.4041 Q. That's the proposal?42 A. Yes, sir.4344 Q. The only other area I wanted to ask you about was just45 to revisit my learned friend Mr Stoljar's questioning about46 the Protect commissions. Firstly, you gave evidence that47 employers get information about those commissions from the

.29/09/2014 120 C CAIN (Mr Crawshaw)Transcript produced by Merrill Corporation

1 union newspaper; do you remember that?2 A. Yes.34 Q. What I want to ask you is whether additionally you5 also, when negotiating enterprise bargaining agreements and6 in particular the question of the clauses relating to7 Protect, tell the employers about the fact that the union8 gets commissions from Protect?9 A. Yes, I did.1011 Q. Is that a practice?12 A. Yes, because we want to be fair and open about it.1314 Q. You mentioned the newspaper articles, the union15 newspaper articles. Can I just show you this document. Is16 that an example of a union newspaper article about Protect?17 A. Yes, and there would be roughly about 5,000 of them go18 out.1920 Q. Yes.21 A. And the employers have them as well.2223 Q. Did you see this this morning and have marked up the24 sections that are relevant to the payment of commissions?25 A. Yes.2627 Q. By the way, who was it who wrote that article?28 There's a photo of someone in the top.29 A. Yes, sorry, Daniel Gerard.3031 Q. Did he have any responsibility for Protect within the32 union?33 A. Yes.3435 Q. What was his responsibility?36 A. Well, to make sure that companies, you know, paid it,37 that the benefits were going out. He done a lot of work on38 administration, other bits and pieces.3940 MR CRAWSHAW: I ask my learned friend whether he might41 tender that.4243 MR STOLJAR: Yes, I tender that.4445 THE COMMISSIONER: That will be Cain MFI-2. It is page 746 of WA Rank and File Voice for May 2013.47


1 CAIN MFI#2 PAGE 7 OF WA RANK AND FILE VOICE, MAY 201323 MR CRAWSHAW: Q. Can I show you another document?4 A. Thank you.56 Q. You saw this document this morning as well?7 A. Yes, sir.89 Q. And marked it up?10 A. Yes.1112 Q. And the part of it that you've marked up, what is13 that?14 A. It actually tells them in respect to commissions - do15 you want me to read it out or --1617 Q. No. What does it form part of? The half of the page18 that contains the marked-up bit, is that an ad for Protect,19 is it?20 A. Yes, it's an ad and it quite clearly articulates about21 commissions and what goes on in that respect.2223 Q. And that's an ad in the union newspaper?24 A. Yes, sir.2526 MR STOLJAR: I tender that page as well, Commissioner.2728 THE COMMISSIONER: That will be Cain MFI-3. It is page 2829 of WA Rank and File Voice for March 20143031 CAIN MFI#3 PAGE 28 OF WA RANK AND FILE VOICE, MARCH 20143233 MR CRAWSHAW: Q. Finally, can I show you this document.34 Is that a document that you had sent over from35 Western Australia today despite the fact it is on a public36 holiday?37 A. Yes, sir.3839 Q. Is that a copy of the Protect brochure that the union40 keeps or advertises at its office?41 A. Yes.4243 Q. Once again, on the last page there's that same44 financial benefit disclosure that was at the bottom of the45 ad?46 A. Yes, that's right.47


1 MR CRAWSHAW: I ask my friend to tender that.23 MR STOLJAR: Yes, I tender that.45 THE COMMISSIONER: That will be Cain MFI-4. It is part of6 the Protect brochure.78 CAIN MFI#4 PART OF THE PROJECT BROCHURE910 MR CRAWSHAW: I have nothing further.1112 THE COMMISSIONER: Q. This is nothing peculiar to you,13 Mr Cain. We have the practice of not giving any publicity14 to the addresses of witnesses. Your witness statement15 contains your address. I will make a direction that that16 address be kept confidential.17 A. Thank you.1819 MR CRAWSHAW: That is the work address.2021 MR STOLJAR: That is the union address.2223 THE COMMISSIONER: I apologise. There is no need to make24 any direction. I revoke what I just said. Any more,25 Mr Stoljar?2627 MR STOLJAR: No, Commissioner.2829 THE COMMISSIONER: There is no objection to Mr Cain being30 excused?3132 MR STOLJAR: No, Commissioner.3334 THE COMMISSIONER: You are excused, Mr Cain, from any35 further attendance on your summons. Thank you for coming36 today. I think we had better stop now.3738 MR KOSTOPOULOS: Commissioner, in respect of the direction39 you've just made, I have noticed that in my client's40 statement he actually has his address as well. Could41 I possibly have the same direction, an order for42 non-publication? It's on page 1.4344 THE COMMISSIONER: You're Mr Meijers?4546 MR KOSTOPOULOS: Yes.47


1 THE COMMISSIONER: I direct that Mr Meijers' address be2 kept confidential.34 MR KOSTOPOULOS: Thank you, Commissioner.56 <THE WITNESS WITHDREW78 MR STOLJAR: Commissioner, we are running very low on9 time. There are two more witnesses. In respect to10 Mr Earle, I might just tender his witness statement so he11 will not have to return: 24 September 2014.1213 THE COMMISSIONER: Does anyone want to cross-examine14 Mr Earle? Very well. Mr Earle's statement is received.1516 #STATEMENT OF SIMON EARLE DATED 24/09/20141718 MR STOLJAR: The final witness is Mr Crumlin. I did have19 some questions of Mr Crumlin but given the hour, I might20 just tender his statement as well and reserve what I wish21 to say for submissions.2223 THE COMMISSIONER: Yes, very well.2425 MR STOLJAR: I tender his statement of 25 September 2014.2627 THE COMMISSIONER: Mr Crumlin's statement is received into28 evidence.2930 #STATEMENT OF PADRAIGH CRUMLIN DATED 25/9/20143132 MR CRAWSHAW: I think there was one correction that33 Mr Crumlin wanted to make. It was minor. If you go to34 paragraph 25, at the top of page 5, the first line says:3536 In around 2010 the Federal Government37 established the ...3839 It should have inserted in there "Workplace Development40 Forum" and then the reference to "the Forum" in the last41 line is a reference to that forum.4243 THE COMMISSIONER: Yes. I think it is pretty innocuous,44 Mr Stoljar, if we accept that correction from Mr Crawshaw.4546 MR STOLJAR: No, there is no difficulty with that,47 Commissioner.


12 THE COMMISSIONER: The statement will be received with3 that change to paragraph 25.45 MR STOLJAR: Thank you, Commissioner.67 THE COMMISSIONER: Will we adjourn until 10am on Thursday8 for CFMEU matters?910 MR STOLJAR: Yes.1112 THE COMMISSIONER: The hearing will resume at 10am on13 Thursday.1415 AT 4.07PM THE COMMISSION ADJOURNED ACCORDINGLY1617181920212223242526272829303132333435363738394041424344454647


€¦ · web viewroyal commission into trade union governance and corruption. maritime union of...

Documents