The Mudginberri Abattoir Dispute

(Mudginberri Station Pty Ltd v  the Australasian Meat Industry Employees Union & Ors)

The Mudginberri Abattoir Dispute was the crucible from which the Australian Farmers’ Fighting Fund (AFFF) was born, and a major landmark in Australian industrial law.

Taking place from 1983-1985, the Mudginberri Dispute was the first successful use of legal action against a union in over a decade at that time. This outcome permanently reshaped workplace standards and industrial relations in Australia, and led to a realignment of the balance of power between Unions and employers that has endured to this day.

Though stemming from a central set of disagreements over industrial standards, the Dispute came to involve 27 separate legal actions and two full years of ongoing litigation.

By the 1980s, the meat production industry in Australia was facing considerable pressure – with wide-ranging closures affecting abattoirs and meat-processing centres across the country. Herd numbers were in decline, and the pressure on the Mudginberri abattoir (which primarily processed for the export trade) was substantial.

Located in Kakadu National Park, 250km East of Darwin, Mudginberri was one of the most remotely located meat processing centres in the country at the time. The abattoir benefited from Government contracts to catch feral buffalo in the South Alligator area, which were subsequently brought to Mudginberri for processing.

Due to its remoteness, and like most abattoirs in the NT at the time, workers at Mudginberri were largely hired on an individual contract basis through labour hire companies with little-to-no Union involvement. Most of these were itinerant workers who lived in the area and worked for only short periods of a few months each year before moving on to other opportunities during the less-busy wet season.

In 1983, the Australasian Meat Employees Union (AMIEU) issued demands that abattoirs in the Northern Territory not already utilising a unit tally system adopt the practice, as part of a push for new industry Award. Mudginberri Abattoir was, at the time, a member of the Northern Territory Cattleman’s Association (NTCA). The NTCA itself was (and remains) a member of the National Farmers’ Federation (NFF).

Unit tally systems operate on a plant-wide single-shift basis with daily kill-quotas. In contrast to this, Mudginberri Abattoir and its contracting partners primarily operated through enterprise bargaining agreements (EBAs) which alternatively allowed for increased flexibility, greater productivity and increased rates of pay.

When the push to adopt a unit tally system was resisted, the AMIEU responded by setting up picket lines at abattoirs including Mudginberri in 1984.

By 1985, the dispute was coming to a head. Unionised workers from an abattoir in Katherine picketed Mudginberri from early May, although the actual Mudginberri workers almost universally refused to participate. Government inspectors were unable to cross the picket line, and production at the abattoir ground to a halt.

By the 24^th of June, work tentatively resumed at the abattoir. However, due to inspection difficulties, the product could only be approved for domestic consumption at just ½ the ordinary export price. AMIEU refused to lift the picket line, despite continued non-participation from the Mudginberri workers and, as a consequence, was heavily fined and had its assets frozen.

In response to this, virtually all Union-affiliated meatworkers went on strike across the country. Clearly, events were spiralling out of control. The NFF, its members and individual farmers recognised that a major financial commitment would be required in order to engage the Unions directly in a court of law and secure a just outcome.

Mudginberri’s owner, Mr Jay Perdarvis, moved to commence legal proceedings against the AMIEU. The proceedings were to be funded by Perdarvis himself, the NT Government (who contributed a $2M conditional loan to Perdarvis) and the NFF and its members. The legal fund set up by the NFF would eventually grow into the modern AFFF.

The next two years saw 27 separate legal actions brought as a result of the AMIEU pickets and strikes. The NFF stated that it was vital that they continue their involvement through the AFFF in order to address “the extreme inefficiencies that exist in most parts of the meat processing industry, due to the enormously powerful position enjoyed in the industry by the AMIEU, and, in particular, because of the most common piecework method employed, that is the unit tally system.”

Ultimately, the Federal Court found that AMIEU’s conduct had amounted to an illegal secondary boycott. An injunction was granted to stop the picket-line blockade, and AMIEU was made to pay close to $2m in damages and additional fines of $2000 per day for each additional day that the blockade remained in place after the granting of the injunction. Jay Pendarvis was awarded damages amounting to $1,759,444.00.

Mudginberri proved to be a tremendous victory for agriculture and the cause of industrial justice across Australia. Major precedents were set in relation to anti-competitive conduct, and the balance of power between the interests of workers, business owners and militant Unions was restored. Ian McLachlan AO, then the president of the NFF remarked that Mudginberri “turned the tide against Union power” and “changed the nature of industrial relations in Australia”. For the AFFF it was both a birthplace and the site of an intense trial-by-fire – one that has led to great advances in access to justice for farmers and agricultural businesses across Australia.