Coles workers seeking five per cent pay rise

Matthew Dunckley
June 10, 2014
The Age
Supermarket chain Coles faces a demand for pay increases well above inflation for thousands of its workers after one of Australia’s biggest unions declared last week’s minimum wage decision had set a new bottom line for wage claims.
The union representing most Coles workers, the Shop, Distributive and Allied Employees’ Association (SDA), is seeking a 5 per cent pay rise from the ­Wesfarmers-owned Coles, which is in the early stages of bargaining with the unions representing some 80,000 workers.
SDA national secretary Joe de Bruyn said a successful wage claim in retail, including Coles, would need to include annual raises in excess of the 3 per cent increase granted in the national minimum wage case.
“We absolutely are looking at over 3 per cent as a wages settlement. Our claim is 5 per cent,” he said.
The agreement is important because it is seen as setting broader conditions in the retail sector.
A Coles spokesman said the ­company looked forward to ­discussions with the unions and declined to comment on pay claims.
“We will continue to work towards an agreement which includes a ­satisfactory pay increase for team members based on the overall package and the proposed flexibility improvements,” he said.
Investors are demanding to know how the new-look Coles leadership will continue the strong earnings growth of the past five years amid signs the ­business is slowing down.
New Coles managing director John Durkan has pledged to cut more costs out of the business.
Australian Retailers Association executive director Russell Zimmerman said agreements with big employers such as Coles set precedents for union claims at other companies and across the industry through ­workplace awards.
He said small to medium-sized retailers could not match a 5 per cent pay claim.
“They could never afford to follow that,” he said.
A Productivity Commission interim report released on Friday showed that supermarket labour costs in Australia were comparable to Britain and the United States as a proportion of ­business costs.
Strong opposition
Coles is pushing for a single agreement to cover all workers in its retail outlets that would combine six agreements into one deal. The Australasian Meat Industry Employees Union (AMIEU) and the Transport Workers Union fiercely oppose the deal, while the SDA and the Australian Workers Union support the proposal. The push follows a similar move by Woolworths.
“To help our stores meet these changes, we need a simpler agreement that brings all Coles supermarkets in line with what already happens in some states and store departments,” a Coles spokesman said.
The added flexibility would allow for better service and “cut out complexity caused by operating six different agreements”, he said.
The move faces some opposition.
“We are opposed to being roped into that agreement,” AMIEU national ­secretary Graham Smith said. “This is extremely important. We have managed to maintain some relatively good conditions of employment at Coles. This process is trying to strip away those conditions.”
He said a single agreement would see deals torn up that had years to run.
“The ink is not even dry on the page yet,” he said.
He said he was also concerned this would mean that his members could not take protected industrial action as part of the negotiations.
“It is a real problem with the Fair Work Act,” he said.
“They are making a list of demands . . . and holding people’s arms up their backs and saying they can’t do anything about it.”
The union had a list of 80 or 90 changes it claimed would worsen its members conditions, he said.
“The conditions . . . would be deteriorated to a huge extent,” he said.
One example was a move to make the ordinary hours of work run from 5am until 10pm, meaning workers on those shifts would not qualify for current benefits of overtime or penalty rates, he said.
He declined to comment when asked for his view of the SDA’s stance on the prospect of a single agreement.
A common agreement would also mean that the votes of AMIEU members, of which there are about 2000 at Coles, would be swamped by the SDA’s membership.
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