company blames underpaid workforce for large profit

The sight today at the local Foodtown was one of hundreds of white tickets peppering the aisles reading,

We're sorry your favourite product is out of stock.

Why? According to the full page ad taken by Progressive Enterprises Ltd in today's Herald,

PEL is suspending grocery distribution centre operations indefinitely to ensure the continued supply of grocery products to customers of Foodtown, Woolworths and Countdown supermarkets ... Industrial action at our distribution center's prevents us from supplying our stores with grocery goods via these center's.

Progressive claims that the Union demand for a single agreement for the distribution centre (DC) workers across the Christchurch, Palmerston North and Auckland DC's and an 8% pay rise will bring the multi-billion company to its knees. 500 employees want to be paid the same rate for the same job. 500 out of 18000 NZ employees will make or break this country's food supply.

Progressive's PR offensive continues to say

PEL is seeking urgent mediation to find a fast resolution and to ensure the union demands for less than three per cent of our staff don't threaten the job security of our entire18,000-plus workforce. We are always prepared to negotiate but not until striking staff return to work.

Which is a bit disingenuous. Urgent mediation and negotiation are usually things that happen immediately before strike action is called, not after. Certainly not after suspending staff for taking industrial action, locking out staff, demanding they return to work without changes to their employment conditions.

The union, the National Distribution Workers Union, responded to the newspaper ad with the following:

Progressive rehired the redundant workers on the lower pay (up to $3 less) and conditions (i.e. ending almost all allowances) of the Progressive Shands Rd Supply Chain and ended the Woolworths National Collective Agreement. Workers at Palmerston North retained the pay and allowances of the original national agreement as the company could not find another location for a new distribution centre and therefore could not legally rehire workers on lower
rates.

All this amongst a fantastic corporate (PDF) result for both PEL and its Australian owner Woolworths Australia Limited. The New Zealand operations reported $2.93 billion sales, reported EBIT of $122 million, sales increase of 3.5% in Q3 and 3.8% in Q4. Food inflation was significantly less at 1.5-2%.

The striking workers aren't getting paid at the moment. Donations can be made to the National Distribution Union at the BNZ account 02-0200-0217968-00 with the reference "Lock Out" to give them a hand.

Kiwi Herald also reports on the issue.