Telstra's snub to labour a blow to ACTU

UNIONS have hit a brick wall in negotiations with Telstra for a new wage agreement after the telco refused point-blank to deal with them any more.

Telstra's decision is a blow to the ACTU-led campaign to rebuild a union-friendly environment in one of the nation's biggest employers after the Rudd Government's election win.

ACTU secretary Jeff Lawrence yesterday urged Telstra to resume talks with the unions immediately, saying he had a letter from Department of Workplace Relations Minister Julia Gillard declaring that union wage proposals were not unlawful.

Telstra received legal advice last month that a "constructive relationship agreement" proposed by the unions contained prohibited content, and therefore breached the construction industry's code of conduct.

Telstra broke off negotiations, saying the ACTU's push for a side-agreement containing the prohibited content would jeopardise its bid to build the nation's broadband network if the company was found to have failed to comply with the code.

Mr Lawrence said a letter the ACTU had received from Cath Day, the director of Ms Gillard's departmental building industry branch, confirmed that a revised union memorandum of understanding that omitted parts declared illegal by Telstra's lawyers was "code compliant".

The ACTU leader said Ms Day's letter removed excuses for Telstra to impose further delays. Negotiations have dragged on since May about Telstra's future relationship with unions, even before unions lodged a pay claim.

Telstra spokesman Martin Barr yesterday dismissed Ms Day's letter as ambiguous, saying it was based on a "doctored document" from the ACTU that omitted important material containing broader union demands.

He said Telstra had negotiated since May without result, and reaffirmed the company's position two weeks ago that discussions had ended.

"Let me make this clear," he said. "We have moved on and we are now looking for better ways to guarantee employees' future rights and conditions."

The strong line is disturbing for the ACTU after Telstra's aggressive push to put two-thirds of its 32,000 workforce on Australian Workplace Agreements and other individual non-union employment contracts. The Rudd Government abolished AWAs in April, but still allows employers other forms of non-union individual contracts with improved minimum standards.

In January, hoping to capitalise on the change of political climate, the ACTU identified Telstra as a priority in its bid to re-establish trade union influence from the ground up.