NBN Co accused of turning a blind eye to its subcontractor workforce

NBN Co has denied ignoring the welfare of its subcontractor field force that does its installation and maintenance work, though it relies heavily on the word of its delivery partners that everyone under them is treated fairly and lawfully.

CEO Stephen Rue and chief operating officer Kathrine Dyer were grilled by a parliamentary committee on Tuesday afternoon, which earlier heard damning evidence of pay and conditions from disaffected subcontractors.

The company was accused point-blank of turning a blind eye to the issues and not caring about people that performed NBN work.

“We do care,” Rue said. “I’m not sure we’re saying that [it’s not our problem].”

However, the hearing raised substantial questions about NBN Co’s contracting model and the governance and assurance processes it has to ensure that everyone performing NBN work is treated fairly and in accordance with the law.

Repeatedly, NBN Co said that responsibility fell to the delivery partners, and that their methods weren’t NBN Co’s concern.

Dyer said that if a new test tool was required to perform NBN work, it was up to delivery partners and contractors to determine who paid for it.

Similarly, the pay that subcontractors ended up with, as well as any pass-through, was a problem for the delivery partner.

“How that is operating is not a matter for NBN Co,” Dyer said.

“It is not a matter for NBN Co to reach inside the delivery partner’s business in relation to that. 

“We are expecting them to comply with the law.”

Dyer revealed that NBN Co puts considerable weight in effectively a statutory document that partners must file with every invoice to the company.

“Every time a delivery partner submits an invoice to NBN Co, they make a declaration that they have paid their subcontractors or their workforce, and they make that declaration at every point in time,” she said.

“So we’re confident, particularly with the additional governance that we have in place with those delivery partners, that the system is working well.”

Challenged as to the extent to which NBN Co then checked up on the truth of the declaration, Dyer said that “we are asking them to make a declaration that they are paying people fairly and on-time, we are checking the completion of their work, and we do have a comprehensive governance framework in place.”

“The stat dec process that our delivery partners are obliged to follow, it’s a serious document,” she said.

Dyer also defended the contracting arrangement as a “common industry model” that pre-dated the NBN and is “well known [and] well disciplined”.

“This isn’t something special that nbn has conjured up in the last 10 years,” she said.

Dyer also defended what she said were additional layers of governance and assurance.

“We have a very robust contractual and commercial framework with our delivery partners, we have very strong governance principles, we’re very active at all layers of NBN Co’s management with the delivery partners, and we do have safety nets such as our whistleblower policy and other policies and codes of conduct, which are in the public domain,” she said.

“This is absolutely an area of focus for us. 

“We work tirelessly to ensure our contracts are strong and people are paid fairly.”

These layers did not appear to uncover the current problems besetting NBN Co, its delivery partners and their subcontracted workforce, however.

These only came to light when a botched workforce scheduling system implementation left subcontractors angry and without work, leading to a series of nationwide protests, a NBN Co-commissioned audit by KPMG and now this parliamentary inquiry.

On the KPMG audit, Rue said that the first draft is currently sitting with NBN Co. He deferred any commitment to make the findings of the audit public.