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As the bin man suggests, if they block the road they still have to drag the bins across the cycleway, therefore still creating a hazard for cyclists.
Also, in blocking the road zero cars will be able to safely navigate the bin truck. A car pulling into the cycle lane would be both illegal and dangerous. I bet some would still try it, and therefore create a more significant hazard to cyclists. However, by blocking the cycle lane, a cyclist should be able to safely navigate past the truck either by waiting for a gap in the traffic or pushing their bike down the pavement. Neither of these are difficult.
As a result, if you compare the two options for the bin men, i think you can reasonably argue they've chosen the best one and the safest for them. Clearly its not ideal, but this is a big, busy, crowded city, and sometimes you've just got to deal with mild inconvenience in a calm and safe manner.
It's blocking the entire fucking bike lane
they could stop in the road
reschedule collection times
change where the pick ups are
redesign the road
anything but block the fucking lane and endanger cyclists