Solidarity

Infamous car parts manufacturer Tristar is screwing its workers again, this time picking on a dying man. John Beaven put in 43 years of loyal service to the company, but now that he is on his death bed with cancer, the company is refusing to offer him a redundancy package:

When Tristar began to wind down its Australian operations two years ago and offered voluntary redundancy to its employees, Mr Beaven, an accounts manager, applied. But although 20 of his colleagues were given redundancy, Mr Beaven was refused.

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After months of frustrated negotiations, Mr Beaven now has days to live. Mr Wood, who is Mr Beaven’s brother-in-law, believes the company, which may owe millions in entitlements to other workers, is waiting for Mr Beaven to die, so he will be one fewer liability on its books. His two sons, both at university, and his daughter, who is doing her HSC, will have no income when he dies.

It’s cheaper for the company to wait until Mr Beaven passes away than to pay him his redundancy now.

An Australian Associated Press article published on the Sydney Morning Herald website this morning bears the headline, Howard may intervene in Tristar dispute. But when you read the body of the article, you’ll find it says exactly the opposite. Howard has defended the legality of the company’s actions, and ruled out intervening:

On the information that I have the company has taken legal advice and has been told that because it’s not a voluntary redundancy it’s not obliged to make the payment. … I’m trying to point out that in this particular case it has applied the letter of the law, I think insensitively and unfairly and wrongly.

It’s a very big step to have a situation where you’ve got to give a discretion to a minister or a prime minister or an industrial relations commissioner to make moral judgments about the behaviour of individual companies.

I don’t think that’s something that would be workable.

Talk is cheap. Howard is flogging the company with a wet lettuce, while reminding everyone that what they are doing is perfectly legal. And the company knows the Government is unlikely to make any serious attempt to crack down — this is only the latest of Tristar’s attempts to circumvent its redundancy obligations, and every step of the way it has been supported by the Howard Government.

Way back in 2001, the AMWU had doubts about Tristar’s commitment to paying workers their entitlements. As part of EBA negotiations, it tried to sign the company up to the Manusafe workers’ entitlement fund — essentially an insurance policy so that if the company went bankrupt, the workers would still be paid their full entitlements. The company refused, agreeing only to protect a fraction of the money owed. When negotiations broke down, the workers went on strike to show they were seriously worried about being ripped off, and then-IR minister Tony Abbott described the workers’ campaign as “economic treason”.

Down the track, we know the workers were right to be worried. When the company decided to start laying off workers, it offered voluntary redundancies, but only allowed “cheap” workers to accept the offer. Anyone with years of service to the company — those who the company should be working hardest to look after — were kept on the payroll instead, with no work to do: “I start at 7:30 in the morning. I come in, I clock on. I go to my desk. And that’s it, that’s all I do all day. I sit at a desk.”

The company decided to play a waiting game (much as it is doing with Mr Beaven). As Labor’s Anthony Albanese explained, the company was hoping to avoid paying the workers their full entitlements:

In spite of there being no work at Tristar, the longest serving employees are being kept on until after 30 September, when their Enterprise Bargaining Agreement expires.

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An employee who worked for Tristar for 32 years expected a payout of $160,000, but all he and his family may get for those loyal years of service is 12 weeks’ pay. That is because the termination of the agreement after 30 September will remove the previous entitlements. This explains why it is the longest serving employees who have not been offered redundancies to date.

At this stage, the Howard Government again did nothing. In fact, WorkChoices made the situation worse. When pre-reform agreements are unilaterally terminated, the workers fall back to the relevant award. As Ron McCallum points out, in the Tristar case people like Mr Beaven get “about a quarter at the very most of their redundancy payments under the award than they would get if the certified agreement was fully honoured.” If companies want to do this, they need to apply to the Industrial Relations Commission.

But under WorkChoices, the company can terminate the agreement unilaterally — and when they do, the workers’ entitlements are even lower than the award: they go back to the so-called “Fair Pay & Conditions Standard”. This is the bare minimum safety net, which is often much, much lower than the applicable award. In other words, WorkChoices increased the incentive for employers to terminate an agreement to avoid making full redundancy payments.

After an outcry from unions about this attack on redundancy entitlements, the Government amended WorkChoices to “preserve” the old entitlements for a maximum of twelve months. This is a slight improvement, but look at Tristar: they’re happy to sit and wait for those entitlements to expire — and if workers die within that twelve months, then so much the better.

So ever since 2001, the Howard Government has supported companies like Tristar trying to wriggle out from their legal obligations. It accused workers of “economic treason” for trying to protect their redundancies. It used WorkChoices to make it easier and more profitable to exploit the “termination of agreement” loophole. And now that Tristar has taken the next logical step — trying to dodge the redundancy payment altogether — the Government says “naughty, naughty” but refuses to lift a finger to discourage companies from going down this dodgy path to begin with.

If Tristar backs down, it will be to avoid bad PR in an election year — the last thing they want is a Labor Government that will actually punish companies that consistently shaft their employees and renege on their agreements. But Tristar and its friends in the business lobby will be waiting for the public to look the other way so they can start pulling these stunts again.