Tristar coughs up a fraction of Beaven’s entitlements
My prediction was right: the Government convinced Tristar to cough up some money, so that bad publicity about its redundancy policy would go away — but nothing has been done to solve the underlying problem.
According to reports, Mr Beaven will be paid $50 000. That’s good news for his three kids, but it’s not as good as it should be. Contrary to Joe Hockey’s claims, this is not a “full payment” — far from it.
Under the Tristar workers’ enterprise bargaining agreement, “[a]n employee who worked for Tristar for 32 years expected a payout of $160,000″. It’s only because Tristar has been playing the waiting game that they’ve managed to get away with paying much less than what they agreed.
And as I pointed out in my previous post, the Howard Government has made it easier and more profitable for companies to pull the same move under WorkChoices. As long as they can sit and wait, they will be able to avoid paying workers their full entitlements.
Will any journalists ask Joe Hockey about this scandal? Of course not. They’ll portray him as “a big bear of a man” who saved the day, instead of someone who provided official support for Tristar’s dodgy practices.
Trevor, could you spell out in more detail the difference between what he would’ve got and what he is getting? I don’t think I precisely understand how they are able to just “wait” as you say.
Sure, no problem.
Tristar has an enterprise bargaining agreement with its employees, which provides four weeks of redundancy pay for every year of service. For someone like Beaven, with 40+ loyal years, his redundancy entitlement is getting up around $200 000.
But the enterprise bargaining agreement only runs for, say, three years. After its nominal expiry date, its terms continue until a new agreement is reached, or until it is terminated. Under the pre-WorkChoices law, the employer could terminate the agreement by applying to the AIRC, where the workers had a chance to argue the termination was not in the public interest.
Assuming the termination was approved, the workers would revert back to whichever award applied to them. This is where the Tristar workers went down from the $150k-$200k under the EBA to the $50k that is their new (and current) entitlement.
Under WorkChoices, the employer can terminate the agreement without going to the AIRC, and the workers drop down to the AFPC, which is even less than many awards. So under WorkChoices, the situation is worse.
The one protection the Government introduced was that the EBA redundancy entitlements would be “preserved” for a maximum of 12 months after the EBA is terminated. That will help some people when a company suddenly finds itself in financial strife and has to lay people off quickly: it won’t have time to pull these stunts.
But Tristar, like many manufacturers, has known for years that it was going to have to lay off workers, and it has played the waiting game to minimise the workers’ entitlements. After it announced it had no work left, it laid off a fair number of workers who had not accumulated much leave. But it refused to lay off the older, long-serving employees.
Instead, it insisted that they turn up to work even though there was no work to do. Essentially it waited until their EBA had expired, terminated it, and instantly slashed their entitlements to about 25% of what it had originally agreed to pay. This, of course, was perfectly legal — and as the changes in WorkChoices show, it’s something the Government wants to encourage.
Waiting for Mr Beaven to die (so that he had no entitlement) was just a logical extension of the existing strategy.
I should add that while the company is waiting the twelve months for the “preserved” condition to lapse, they only have to pay minimum wage. Not only does this make it much cheaper for the company to keep waiting, it also means there is massive pressure on the worker to accept a voluntary redundancy at much less than their full entitlement.