Home > Dollars & Sense, Social Issues > Harbour battles & casual fear

Harbour battles & casual fear

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Why is newbie National MP, Jamie Lee-Ross, getting involved in pay negotiations that don’t concern him personally?

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Full Story
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Ports of Auckland is not a state Owned enterprise. Therefore, Mr Lee-Ross has as much to do with that company and it’s employer-employee negotiations as he might with any other company in the country.

Is he intending to comment on the next wages-negotiation between Fulton Hogan and it’s staff? Fletcher construction and it’s employees? Perhaps he might feel inclined to comment on Wattie-Heinz negotiations with their workers?

While we’re about it; Mr Lee-Ross has a very generous tax-payer funded salary; with free travel perks; and a gold-plated superannuation fund that tax-payers (again) subsidise.

His  salary comes to $141,800 – quite generous for these recessionary times. In fact, on 17 November last year, it was increased from $134,800, and back-dated to 1 July 2011.

In which case, so what if maritime union workers are well remunerated? They do a hard, dangerous, dirty job – one that most of us would think twice before doing. Being highly paid is also National Party policy, as John Key outlined in 2008;

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We will be unrelenting in our quest to lift our economic growth rate and raise wage rates.” – John Key, 29 January 2008

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Perhaps Mr Lee-Ross is unaware that the Maritime Union appears to be fulfilling National Party policy?

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With a full-blown propaganda war now in effect between the Ports of Auckland management; right wing politicians; and various reactionary groupies on one side, and the Union, workers, their families,  and  supporters on the other – the first casualty has indeed been truth.

Specifically, the amount earned by maritime union members. First of all, I would point out that the wages paid to maritime workers is actually irrelevant.

It’s really no one’s business what Port of Auckland’s employees are paid. That is a matter between bosses and workers.

After all, how many other New Zealanders would really welcome the glare of public scrutiny on their incomes? (Especially self-employed – many of whom have a tradition of doing “cashies”, which they fail to declare to the IRD.)

The spotlight on maritime workers’ incomes seems to have emanated from the Ports of Auckland, CEO, Tony Gibson, who said,
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“…the average wage for a stevedore is more than $90,000 a year and the lowest rate is $17.12 an hour.” – Source

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Catherine Etheredge, Port of Auckland’s Senior Manager Communications, posted this statement on The Standard,

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I can confirm that the average remuneration for a full time stevedore, in the year ended June 30, 2011, was $91,480. The average remuneration for a part time stevedore (guaranteed at least 24 hours work a week) was $65,518.

53% of full time stevedores (123 individuals) earned over $80,000. 28% (43 individuals) earned over $100,000 with the highest earner making $122,000.

The averages were calculated by POAL’s payroll team based on actual payments, including for leave days, medical insurance and superannuation contributions. (For employees covered by the collective agreement, POAL matches their superannuation contributions up to a maximum of 7%.) We excluded those who had worked for less than the full 12 months e.g. had left part way through the year.

Employees are also entitled to 15 days sick leave per annum, accruing up to 45 days. All shift workers are entitled to five weeks annual leave. Training for all stevedoring tasks (crane driving, straddle driving and lashing) is undertaken in house and is paid for by the company.

One question that has been asked is how many hours you have to work to earn that $91,000. Stevedores who earned the average $91,000 in the 2010/11 financial year were paid for an average of 43 hours per week, excluding leave days. If you factor leave days in, that increases to 49 hours per week.

This leads to the key issue for the company – the high amount of paid downtime – an average of 35% of total hours paid. An employee getting paid for a 43 hour week is only working around 28 hours; for a 40 hour week, 26 hours. In a busy week, employees get paid for 66.5 hours but can only work for a maximum of 44.5.

On Monday 9 January, to give a recent example, we paid 26 staff a total of $5,484,80 for downtime, because they were entitled to be paid until the end of their set eight hour shift even though the ship had finished & they had gone home. In another example employees worked two hours of an overtime shift but were paid for the full eight hours.

This is not a cost-efficient nor sustainable labour model, especially when the company is not covering its cost of capital, cannot therefore justify further investment in order to grow, and its closest competitor has a labour utilisation rate in excess of 80%. (At Port of Tauranga stevedores start and finish work when a ship arrives and departs).

The company has offered an upfront 10% increase to hourly rates along with the retention of existing terms and conditions in return for more flexible rosters which would significantly reduce the amount of paid downtime. Employees would have the opportunity to plan their roster a month in advance. This proposal would result in a people being remunerated for fewer overall hours at a higher rate than they would currently get for the same paid hours. To be fair, until such time as container volumes recover/improve, the 10% increase to hourly rates would not (as some commentators have suggested) push average remuneration over $100K.” – Source
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Yet, at least one blog-poster at “The Standard”  noticed a discrepancy in Ms Etheredge’s statement, and questioned her figures,

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I’m not sure this bit adds up – would appreciate someone to check my math 🙂 .

For 123 workers to be 53% of the workforce, that gives a work population of 232. But for 43 individuals to be 28% of the workforce, the population is 153. I assume there’s a typo in there somewhere. If 43 workers are indeed on more than $100k out of a population of 232, then that means an actual top-echelon level of 18% of the workforce.

And I’m not familiar with the organisational structure on the port – does this average include only personnel with no personnel that report to them, or does is include the shift leaders or even a tier above small-team supervision?” – Source

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It is further worth noting that Ms Etheredge states,

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This is not a cost-efficient nor sustainable labour model, especially when the company is not covering its cost of capital…

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“Not covering its cost of capital“? Yet, according to the National Business Review, Ports of Auckland posted a $24.9 million profit in  the year to June – up 2.1% on the previous year.

And in October 2010, Managing director Jens Madsen said that “overall container volumes in the three months to September 30 were up nearly 8% on the same period last year“.

The Maritime Union states,

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A stevedores guarantee for 40 hours per week is $1,090.40 = $56,700.80 per annum @ 260 shifts per year.  To earn the money being quoted by Mr Gibson, stevedores would have to complete an extra 1,377 hours.  Stevedores are required to work days or nights, weekends, public holidays – basically any shifts 24/7 often 16 hour shifts.” – Source

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Helen Kelly, from the CTU says on the same blog-page,

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The first position was that Port workers earn an average of $91,000 for a 26 hour week. This was widely publicised and is now being so seriously challenged they have been flushed out to provide the correct information.

Now it appears the $91,000 is for a 49 hour week and this includes superannuation, medical insurance etc. Assuming the superannuation is 7% then $6,370 of this is a super subsidy, leaving an avearage annual salary of $84,000. Given these “average” workers are working 22.5% more hours than a “normal working week” of 40 hours, then $20,475 of this salary can be considered payment for the extra working hours.

This leaves an avearage wage of $64,155 which includes medical insurance.

The union says a stevedores guarantee for 40 hours per week is $1,090.40 = $56,700.80 per annum @ 260 shifts per year. Regardless, the position has changed dramatically since the Ports first shots rasing questions about the other information they are using to disguise the agenda to make permanent workers into casuals.

It would be great if the Port could provide the avearage salary of the 20% of casuals workers they employ at the port by hours worked?” – Source
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The figures quoted by the Ports of Auckland appear to have been somewhat “massaged” – ie, presented in such a way as to present the best possible “message” for management. Of course, it is difficult to verify what the workers are paid without sighting payslips.

But the wording of Ms Etheredges statement and her reference to “average”, indicates that there is more to this matter than we’ve been told.

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But this isn’t even about a wage-increase – that is a mis-representation by the Ports of Auckland – as the 10% wage-increase was an offer from MANAGEMENT to the Union, in return for casualising the work-force. As the Maritime Union stated,

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The union position is clear. It does not want the 10%; it wants secure, ordered and transparent rosters for its members.”  – Source

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Casualisation would mean that instead of having a 40-hour job (which most New Zealanders aspire to), it  would be part-time, and on-call. Workers would be  sitting at home, waiting for a phone call to come to work.

No one can raise a family; put food on the table; and pay a mortgage with a “McDonalds”-style casual-job.

Jamie Lee-Ross states,

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Every Aucklander has a stake in the Ports of Auckland. It is not a privately owned company. Nor is it listed on any stock exchange. Each and every share in the company is owned by the Auckland Council on behalf of 1.4 million Auckland residents and ratepayers. The destruction in value in one of our city’s largest public assets is alarming and has to be of concern to us all. ” – Source

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Three points:

1. Whilst ratepayers most certainly do own the Ports of Auckland, there is no risk to them, nor the shareholding Auckland City Council.

Ports of Auckland posted a $24.9 million profit in  the year to June 2011. So it is a self-funding operation, and quite a profitable one at that.

2. It is disturbing that Jamie Lee-Ross is not as concerned about the “destruction in value” of jobs. Maritime workers face losing their full-time jobs, and instead turned into casual workers.

How can a workers raise their family when they don’t know what they’ll be earning from day to day; week to week?

3. It’s nice to see a National MP recognising the fact that Ports of Auckland is owned by the people of Auckland. Hopefully, Mr Lee-Ross will remember this when his government colleagues vote to sell the first state owned enterprise, Mighty River Power – which is also owned by the people.

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Despite John Key’s pledge in 2008, it seems clear that National and their business fellow-travellers are content to see wages cut.

Bill English stated as much on “Q+A”, on  10 April 2011, when he seemed to express satisfaction that New Zealand’s wages were more “competitive”, by around 30%, to Australia’s,

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BILL Well, it’s a way of competing, isn’t it?  I mean, if we want to grow this economy, we need the capital – more capital per worker – and we’re competing for people as well.

GUYON So it’s part of our strategy to have wages 30% below Australia?

BILL Well, they are, and we need to get on with competing for Australia.  So if you take an area like tourism, we are competing with Australia.  We’re trying to get Australians here instead of spending their tourist dollar in Australia.

GUYON But is it a good thing?

BILL Well, it is a good thing if we can attract the capital, and the fact is Australians- Australian companies should be looking at bringing activities to New Zealand because we are so much more competitive than most of the Australian economy.

GUYON So let’s get this straight – it’s a good thing for New Zealand that our wages are 30% below Australia?

BILL No, it’s not a good thing, but it is a fact.  We want to close that gap up, and one way to close that gap up is to compete, just like our sports teams are doing.  This weekend we’ve had rugby league, netball, basketball teams, and rugby teams out there competing with Australia.  That’s lifting the standard.  They’re closing up the gap.

GUYON But you said it was an advantage, Minister.

BILL Well, at the moment, if I go to Australia and talk to Australians, I want to put to them a positive case for investment in New Zealand, because while we are saving more, we’re not saving more fast enough to get the capital that we need to close the gap with Australia.  So Australia already has 40 billion of investment in New Zealand.  If we could attract more Australian companies, activities here, that would help us create the jobs and lift incomes.

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Bill English seems to want it both ways; lift wages – but yet keep wages “competitive” with Australia. I guess one day he might make up his mind.

De-unionisation is currently proceeding throughout the country. Another industrial dispute is at CMP Rangitikei where contract negotiations between the ANZCO-owned plant and the NZ Meat Workers Union has resulted in one hundred and eleven  workers locked out at their  plant when they resisted pay cuts of up to 20% and reductions in conditions.
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Full Story

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There is a silent war going on in this country. It is a war to destroy any and all  remaining unionised-protection for workers and to increase “flexibility” and “competitiveness”. Such moves will have the consequences of driving down wages even further, and which will increase business profits, and dividends for shareholders. Tough luck, I guess, if it’s done at the expense of staff.

Businesspeople and shareholders: two of National’s core constituents.

Little wonder that employment confidence has taken a steep nose-dive,
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Full Story

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One thing should be perfectly clear to every worker in this country; if a strongly unionised workforce such as Ports of Auckland workers, and ANZCO freezing workers,  can have their employment conditions arbitrarily changed, and casualised against their wishes – the question on everyone’s mind must be, “Who is next in line? Is it me?”

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As well as attempting to drive down labour costs by destroying the Maritime Union, there appears to be another, lesser-known agenda at work in the backrooms of various “movers and shakers” – privatisation.

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Full Story

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Note that the above article came out on the same day as the NBR published a report, “Imports drive Ports of Auckland profit higher“.

It would appear that this is not just a battle for the control of worker’s pay and conditions – but for the  Ports of Auckland itself.

As the National Business Review reports  stated, the Ports of Auckland is a growing, highly-profitable business.

The attack on Maritime port workers by PoA management is, I believe, designed to achieve a single goal, exploiting several methods,

  • Attack workers’ rights and conditions; create chaos on the waterfront; paint the Union as “lazy greedies”; and stir up Auckland ratepayers’ anger, until they’ve had enough and want the Ports of Auckland sold off. Result: easy privatisation of a very valuable asset.
  • Change the current, permanent, workforce into a casualised workforce. Result: reduce wage costs for new, private owners.
  • Drive the Maritime Union of the Ports of Auckland. Result: greater casualisation if the workforce; lower wages even further; eliminate all workers’ protection.

This, I believe is the real agenda.

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Previous blog story

At gunpoint, maybe?

Sources

Scoop: Union Biting the hand that feeds

National Party MP: Jami-Lee Ross – Biography

John Key  SPEECH: 2008,  A Fresh Start for New Zealand

TVNZ Q+A: Guyon Espiner interviews Bill English (transcript)

Wanganui Chronicle: Overseas labour concerns union

NZ Herald:  Sentiment on work prospects gloomy

NBR:  Imports drive Ports of Auckland profit higher

NBR: Plea for ratepayers to give up port control

NBR: Increased traffic at Ports of Auckland

NBR:  Ports of Auckland profits hold steady

Additional

Scoop: POAL documents show senior management running own agenda

Chris Trotter:  The Auckland Ports Dispute: An Injury To All

Chris Trotter:  Port bosses sensitive to show of union power

Tumeke: The Manufactured Crisis at Ports of Auckland and why did Len Brown walk into it?

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