Teys looks at closing abattoirs

17 Feb, 2015 04:18 AM
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If the Prime Minister is serious about jobs they will reform the industrial relation system

ONE of Australia's largest meat processors says it is contemplating closing abattoirs because the industrial relations system overruled an agreement that its workers agreed to but was opposed by the industry union.

Teys Australia - which has been in a long battle with the Australian Meat Industry Employees Union over an enterprise agreement - said last week's loss in the Federal Court had forced it to consider closing the plant in Beenleigh, south of Brisbane, which would result in 800 job losses.

"At the end of the day we said we had to completely restructure that business to make it viable in the long term. Nothing's changed," Teys general manager of corporate affairs Tom Maguire said.

The union said Teys - which has six other meat processing plants around Australia - should stop pursuing legal options and sit-down with unions to negotiate a fair and decent agreement for employees.

"The 'reform' of course was about securing huge workload increases at their Beenleigh plant. It wasn't really as noble as reforming the meat industry, it was simply about them securing fat profits. In other words - pure greed," the Australian Meat Industry Employees Union said in a statement.

Mr Maguire said the company was still deciding whether to take the appeal to the High Court, but called on Prime Minister Tony Abbott and Industrial Relations Minister Eric Abetz to tackle industrial relations reform in the lead-up to the 2016 election.

"If the Prime Minister is serious about jobs they will reform the industrial relation system so we can protect some jobs in manufacturing," he said.

"At the very least, the minister needs to look at the appeals jurisdiction because it has failed. The Federal Court has basically said that the decision by the full bench of the Fair Work Commission was wrong but they are legally entitled to make wrong decisions. This highlights the brokenness of the current IR system."

The meatworks came into the national spotlight during the 2013 federal election campaign when then opposition leader Tony Abbott questioned why the Fair Work Commission would not endorse a workplace agreement supported by most of the staff.

The current dispute revolves around the 2013 agreement which Teys says was supported by the majority of employees. The unions claim the agreement was invalid because of the close vote and questioned if some of the employees should have been allowed to vote.

Teys Australia says the 2013 enterprise agreement had allowed a restructuring of the processing plant that saw 500 employees receive an average bonus of $4500 in 2014. It claims 35 jobs have been created since the new workplace agreement came into effect.

The agreement was given the green light by a Fair Work Commission deputy president Ingrid Asbury before unions appealed to the full bench of the Fair Work Commission.

It was sent back to Deputy President Asbury who later stood by her original decision.

The unions then appealed the decision to the full bench of the Federal Court. Another related matter on the same enterprise agreement is still before the courts.

Mr Maguire said a decision about the future of the Beenleigh plant was fast approaching with cattle herds falling later this year and tougher international competition from the United States and Brazil which can produce at half the cost of Australian processors.

It costs about $300 a head to process cattle in Australia compared to about $165 in the US and Brazil.

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READER COMMENTS

Northern Exporter
17/02/2015 8:13:31 AM

well it looks like the cracks are appearing in the superstructure! It wouldn't be that live export is a new competitive force in the grassfed cattle market? It wouldn't be that the China FTA provides a live-ex market for southern blacks and bos Taurus cattle at a price 50% above the current market? Teys and the processors have been able to discount the grassfed market by at least $150-$300 per head over the last few years on USA saleyard prices here in Australia. So whats different now - stiff competition from live-ex!
beeffarmer
17/02/2015 12:26:09 PM

Mr. MaGuire again! First we push the saleyard at Wodonga to try to get post sale weighing. Now we push for the industrial relations system to be fixed. Perhaps Mr. MaGuire could move to the US. I doubt that producers nor employees will miss the one sided view points of this man. He doesn't speak for the producer, nor the worker. Stiff competition from export markets for dwindling numbers of stock is the only thing that will produce an appropriate return for cattle producers. Let Mr Macguire explain exactly how much money each beast makes, then let's look at who gets what.
Sir Les P
17/02/2015 6:04:51 PM

Well Teys & other processors have had Christmas every week for the last 20 years thanks to producers, now it's our turn.
David Hill
18/02/2015 6:24:18 AM

If you are to have a realistic value of what processing costs in this country, wouldn't you need to add the value of co-products? which don't get much of a mention, I have heard these products could be worth upwards of $400 at times. Given that the producer receives nothing for co-products, could the true cost of processing be nearer to $700? I have recently seen an article that quoted US per head margins of $60, these are said to have been as high as $700 in this country recently, could the production sector mount a case that they are the ones most affected by the cost of processing?
Philip Downie
18/02/2015 7:00:25 AM

It may well cost more to process but in costs about 1/2 to buy the animal so maybe they should look at total cost? While you are at it how about we see the total returns to the processor, not likely. Never forget these savings go to the processor bottom line nothing to the farmer.
qlander
18/02/2015 7:15:33 AM

I seen a report saying a major processor reckons it could generate a profit while paying $5/kg dressed (about $1650 for a 600kg steer) If that is true they were making more then $1000/head last year. Dinmore can kill 3000/day = about $3million/day profit.
trader
19/02/2015 11:56:10 AM

Come on you selfish cattle producers, us processors are actually making a trading loss in Australia because when we sell boxed beef to our tax haven based off shore trading company we price it at or below the cost of production then while it is on the water beef becomes real dear for us to sell it to our US or other destination based distribution company so we don't make any money there either. You have to understand we processors like making lots of money and we do not like paying tax! and we are all private companies so we do not have to bear much public exposure to how we operate.
the advocate
28/02/2015 4:11:24 PM

northern exporter - the prices here were $1000 to $2000 a head cheaper than America and Canada, not $150 to $300!! I think qlander is probably close to the money!
Tony Hogben
1/03/2015 5:17:33 AM

...bad management, bad union practices, bad meat inspection behavior, have been destroying this industry for decades....
BeefedOff
2/03/2015 6:22:01 AM

If i get charged $100/hd to process an animal, and then $180/hd to put it all in a box, thats one thing, but I dont get the luxury of then sell it into the US for $/Lb. Pay the workers a decent wage for a bloody hard job, and engage with the producers so they can share in the downstream wealth. If there is no money in it, sell it back to Australian interests so that we can build an Australian owned processing sector to compete in your home market. Bet you won't let that happen.

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