Fonterra workers to fight penalty cuts

REGIONAL milk processor Fonterra has waded into the wage debate, arguing removing penalties at its factories including those in the south-west will help it compete globally. 

Fonterra Australia managing director Judith Swales told Fairfax Media this week that overhauling penalty rates would allow for the company to become more flexible by correlating work hours with seasonal milk supply. 

“Essentially you are not legislating that people have to work 38 hours a week, 48 weeks a year,’’ she said. 

“They can work longer hours without penalty (during peak supply periods) but then they get time off either side of the peak,” Ms Swales said.

The comments come as a federal review of workplace laws gets under way. Fonterra operates processing sites in Dennington and Cobden.

But a union representing hundreds of Fonterra staff says it will fight any changes to the penalty system. 

National Union of Workers (NUW) Western District organiser Darren Stiles said the remarks were “surprising”, adding that penalties had not come up in recent talks between the union and the company. 

“They talk about highly paid employees,” he said. ‘‘The average worker at Fonterra makes $50,000 a year and the average Australian wage is $55,000,” Mr Stiles said. 

“The only reason they (Fonterra workers) make more than that is because of penalties.” 

He said the union would oppose any move by the Commonwealth to remove penalties and instead allow for more time in lieu.

“We are very strongly of the belief that our penalties are not up for negotiation. We won’t give up our penalty rates,” Mr Stiles said.  The union is due to negotiate a new enterprise bargaining agreement for Cobden later this year. 

He doubted that Prime Minister Tony Abbott’s 2013 election campaign slogan that WorkChoices was dead, buried and cremated. 

“It’s really only sedated at the end of the day,” Mr Stiles said. 

But the Fonterra boss drew links between high wages and the demise of the car industry. 

“But I think more flexibility, not to disadvantage people but to make us more competitive, is kind of the name of the game,” Ms Swales said.

“If we want to be serious players on a global scale we have to have seriously competitive and efficient manufacturing operations.

“You could argue it’s one of the issues for car manufacturing. We didn’t have a globally competitive manufacturing cost base in terms of some of the enterprise agreements and maybe some of the technology. In dairy we are no different.’’

With The Age

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