Huhtamaki, the company responsible for 70 per cent of the nation’s egg packaging, is facing serious industrial disruption at its Preston factory in Melbourne owing to the collapse of enterprise agreement negotiations with the CFMMEU.
Huhtamaki is extremely concerned about the impact the industrial disruption will have on the supply of egg cartons to its customers and, in turn, on the supply of eggs to families and businesses around Australia. Huhtamaki is also very concerned that the union has adopted tactics that threaten Huhtamaki’s business while the company is focussing on maintaining supply in the face of pandemic shocks and challenges.
Based on current inventory, many Australian egg farms low on cartons will be affected immediately by the impending stop work action, impacting the daily packaging of 7.5 million eggs across Australia and disrupting egg supplies into supermarkets and cafes.
Because the ongoing effects of COVID-19 on international supply chains is restricting imported supplies of egg cartons into Australia, many customers have been left waiting 12-18 weeks for delivery on current orders. In order to ensure a steady supply of egg cartons during this time, Huhtamaki has stepped up and is currently supplying roughly 90 per cent of Australia’s egg cartons.
The CFMMEU has given notice of rolling stoppages in the Preston factory commencing Friday that will result in a 70 per cent contraction of output. 35 per cent of Huhtamaki’s customers will be immediately impacted while its remaining customers will suffer carton shortages as the stoppages eat into existing inventory. The CFMMEU has also put a ban on quality checks, shift handovers, housekeeping and cleaning duties in all parts of the workplace.
The union is demanding four per cent annual pay rises each year for the next three years. This is over 50 per cent more than pay rises being granted on average across the manufacturing sector and it comes as Australian families face unprecedented job insecurity and economic hardship owing to the pandemic.
The CFMMEU claims also seek to interfere with the company’s ability to manage staff, which will undermine productivity at the plant and threaten future investment in one of the surviving sectors of Australia’s manufacturing industry.
Huhtamaki is offering a 2.6 per cent per year increase over the next three years back paid to the beginning of the year, on top of generous benefits already enjoyed by its workers, including Double Award payments and 62.5 per cent leave loading. The offer is in line with pay rises in comparable Australian manufacturing industries and results in the Preston factory workers earning well above industry standards.
Huhtamaki is proud of its competitive remuneration and the consistent, reliable employment it has provided for its 130-strong workforce, particularly during the COVID-19 pandemic.
“In a year that has left more than 900,000 Australians, including seven per cent of Victorians, out of a job, the CFMMEU is demanding a four per cent pay rise despite earning almost double the average annual salary of other manufacturing workers in Australia,” said General Manager, Huhtamaki Fiber Packaging Oceania, John Sartori.
“In the middle of a recession, the Union’s action threatens an industry that employs 3,839 people and generates $900 million each year. Domestic supply chains – already under significant strain – are facing further disruptions from the actions of the Union, placing additional pressure on Australian farmers and threatening the supply of eggs to businesses in the food and hospitality industries which are desperately trying to recover from the impact of the pandemic,” he added.
“We recognise our employees’ right to bargain collectively and have continued to work in good faith with the CFMMEU for more than eight months in the hopes of reaching a mutually satisfactory outcome for both parties. Regrettably, we’ve had no success. We urge the Union to work with us to resolve this before any more undue harm is caused to Australian businesses and farmers,” he concluded.
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