TWU wins 14% wage increase for transport workers

Release date: 25/11/2010

The Transport Workers Union has secured above-inflation wages rises of between 14 and 21 per cent for air freight workers.

Ewin Hannan, Industrial Editor, The Australia

The deal, the union has declared, will be a benchmark for its national pay strategy on behalf of 50,000 aviation and transport employees.

In a statement that sparked criticism from employers last night, the union's federal secretary, Tony Sheldon, said the agreement reached with Australian Air Express did not contain any productivity trade-offs by the employees.

Following union strike action last week in support of an initial 16per cent pay claim, the company agreed to pay three annual wage rises of 4.5 per cent and an extra 0.5 per cent increase for the last three months of the agreement to about 450 workers.

Mr Sheldon said a new classification structure would deliver a further 7 per cent increase to an initial 10 to 15 per cent of the workers affected, resulting in those workers receiving an initial 11.5 per cent pay rise backdated to July this year.

He said the deal would be a model for other agreements the union was pursuing on behalf of 35,000 workers in the transport sector and 15,000 aviation industry employees.

"It is a significant agreement," Mr Sheldon said. "It does set a benchmark and a precedent."

Asked if there were any productivity trade-offs by the employees in exchange for the pay increases, he said: "No, there isn't any productivity trade-offs."

Mr Sheldon said employees had kept their claims low during the global financial crisis and the agreement "pales into insignificance when measured against the growth in company profits and executive salaries over the past 12 months".

Employers last week warned that rising wage settlements were "out of kilter" with inflation and productivity growth, after new figures showed wages were increasing at their quickest rate in two years.

Among the wage claims is a push by the Communications Electrical and Plumbing Union for above-inflation annual pay rises of 5 per cent for workers engaged on the National Broadband Network.

The Australian Chamber of Commerce and Industry said yesterday that productivity growth generally appeared to be "stagnant" and it was concerning that the air freight deal delivered substantial pay rises without any trade-offs.

"It is disappointing to hear there were no productivity changes," said the chamber's workplace policy director, David Gregory.

He said employers were concerned that the union strategy would drive up costs for business.

"It's early, early days but there are some genuine concerns that, post the election, with a tightening labour market and with the economy improving, that we are going to see some substantial wage rises being pursued."

He said Mr Sheldon's assertion that the growth in executive salaries was "far outstripping" the pay claims by union members was a "cheap shot".

ACTU president Ged Kearney said this week that some employer and business organisations were using wage rises as a "proxy for what is their real agenda: a renewed attack on workplace rights protected by the Fair Work Act".

She said any discussion about a wages breakout should be held "in the mahogany-lined boardrooms of Collins Street and Martin Place, because this is where we are really seeing a pay boom".

"Any claims by employers that a big wage rise in one sector will flow through to the rest of the economy must be taken with a grain of salt," Ms Kearney said.

"This may have been the case in a more centralised IR system in the 1980s, but under the Fair Work Act, our system remains based around enterprise bargaining with natural brakes on a wages break-out," she said.

In a short statement yesterday, Australian Air Express said it had reached a "mutually beneficial agreement which will see AAE continue to provide a high level of service to our customers".

The deal also represents a breakthrough in the ACTU push to restrict the use of casual labour, with the company agreeing to limit the introduction of casual and part-time employees and guarantee that regular casuals would have the right to convert to permanent employment after 12 months.

The company will be required to consult the union before using any outside contractors or labour-hire employees, with the latter to be paid the union-negotiated wages rates when employed by AAE, a joint venture between Qantas and Australia Post.

Workers will be able to access extra annual leave of one week through an agreed salary-sacrificing arrangement, while the company had committed to provide the union with access to details of company security and training programs.

Mr Sheldon said the strike action last week had "forced the company's hand" as it had been adamant it intended to hire outside labour on lesser pay rates.

The union is due to start bargaining with Qantas over a new pay deal early next year.

The deal will be presented to union members for consideration over coming days but delegates will recommend it be supported.

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