Wage Slavery

What are the common wages of labour, depends everywhere upon the contract usually made between those two parties, whose interests are by no means the same. The workmen desire to get as much, the masters to give as little as possible. The former are disposed to combine in order to raise, the latter in order to lower the wages of labour. – Adam Smith in Wealth of Nations.

In March 1970, in Queensland, the average weekly wage was $64.70. A 21 year old female nurse was paid $26 per week by the Mater Public Hospital. In 1968, at 17 years, I was paid $28 per week as a laboratory cadet at the University of Queensland Veterinary School. Queensland was the lowest paid state in the Commonwealth, with average weekly earnings nearly $10 a week less than in New South Wales and Victoria. Wage inequality was widespread with many people in the pastoral sector being paid very low wages for long hours and difficult work. Aboriginal and Torres Strait Islander people had their wages taken from them and managed by the racist Department of Aboriginal Affairs. Women were paid less than men across-the-board.

The nurse employed by the Mater Hospital in Brisbane in 1970 had this to say 50 years later: “Times change but not always fairly for all.”

In 2018, Coles employed a chef in a local Tavern. The following year Coles sold the restaurant part of the tavern business to Australian Venue Company retaining the liquor licence in the adjoining pub. AVC is owned by private equity firm, Kohlberg Kravis Roberts & Co. L.P. (KKR). The new owners put in a 28 year old manager to run the restaurant. They amended the chef’s contract of employment putting him on call for 42 hours a week. This was in excess of the NES standard of 38 hours per week provided for in s 62(1) of the Fair Work Act 2009. AVC would not pay penalty rates because they had lifted his base rate of pay. However under that agreement he was supposed to be working only 38 hours a week. Was he paid overtime? No. As a result of mismanagement of the roster and the failure of the company to pass the better-off-overall-test (BOOT), the chef left the company. Unlike in Hart’s case described below, the chef did not have the wherewithal to run a test case against AVC or Coles. It is likely that AVC contracts for its managers is similar to this one; that is, screw the chefs working in the 87 hotels AVC bought from Coles.

AVC paid Coles $200 million for the pubs in this portfolio. Coles Chief Executive Officer, Steven Cain had this to say about the joint venture: “The agreement with AVC will enable each party to bring relevant expertise to the joint venture … AVC is a highly experienced and responsible operator of quality hospitality venues … AVC has plans to grow the hotel portfolio in Queensland which will in turn provide Coles with the opportunity to further grow its Retail Liquor business in that state.” [Portfolio of 87 Coles pubs sold to Australian Venue Co for $200m] But he would say that, wouldn’t he?

In Ben Schneider’s book Hard Labour the author says that Coles were exploiting 77,000 workers on a mass scale at the same time as the chef was having difficulties at one of their restaurants. The Fair Work Commission found in Duncan Hart’s case that Coles had failed the better-off -overall-test in the Fair Work Act. The book went on to say that 750,000 workers in Australia are subsist in Australia under visa conditions that restrict their work rights. They have no right to citizenship. Nearly 1,000,000 workers are underpaid in an environment where accommodation food and energy costs are skyrocketing.

So in 2022 Wesfarmers, the owner of Coles, Myers, Officeworks and Bunnings, puts out a statement about its aversion to modern slavery. They employ people in retail giants to be on the lookout for unethical work practices and human rights abuses in their global supply chain, looking closely at products from Southeast Asia, Africa and South America.

Since 2012, companies like Coles had been systematically abusing it’s responsibilities under the Fair Work Act introduced by the Gillard and Rudd governments. They were aided and abetted in this by the catholic union SDA run by National Civic Council member, Joe DeBruyn. Ben Schneider states: “A little over a year later, the full bench of the Fair Work Commission decided that the appeal driven by Cullinane’s analysis – along with the work of Duncan Hart and lawyer Siobhan Kelly – returned this decades old rort on its head. ‘That just burst it open and made it clear that this wasn’t just a one off with Coles. That was the inescapable’. Later the federal Department of Employment, in a submission to a Senate inquiry, further confirmed the analysis. It was basic maths that the SDA deals locked in much lower wages – unlawfully so – for most workers.” [Hard Labour, from Friend to Foe, page 112 – 113.]

During the pandemic, Coles supermarket sales soared by 6.9% & earnings increased by 10.7%. Its top executives are paid up to $7million per annum. At the same time, according to Ben Schneider’s Hard Labour, Coles engaged in unlawful and systematic wage theft from its workers. In 2021 Coles management locked out its workers at its Smeaton Grange warehouse seeking to automate its warehouse functions and to make 2,200 workers redundant nationwide by 2023. [https://www.wsws.org/en/articles/2021/04/22/cole-a22.html].

Duncan vs Goliath
There is an interesting story in Ben Schneider’s* “Hard Labour” about Duncan Hart who took on both Coles and the Catholic union, Shop, Distributive and Allied Employees’ Association (SDA), as they assisted HR to steal the wages of workers at Coles. This conflict between rank and file workers pitted against a right-wing union and big business led to the formation of the Retail and Fast Food Workers Union (RAFFWU) which had about 3,300 members at the time of writing Hard Labour in comparison with SDA which has over 200,000 members.

In the chapter titled Duncan versus Goliath the author was drawn into a debate with Joe De Bruyn about marriage equality. Curious, in a book about industrial struggles over wages. Both De Bruyn and Schneider both have Dutch catholic backgrounds but very different points of view on social issues like marriage equality and the rights of women.

Importing non-union labour
Under Labor and LNP governments scab labour has been imported into the country for systematic exploitation buy a big companies like Wesfarmers.

Enterprise bargaining agreements in office supplies industries routinely have no-strike clauses signed by CEOs employed by overseas companies.

MELBOURNE, 18 MARCH 2022
Troy Swan, the  general counsel and company secretary of WINC (a merger of Staples/Corporate Express/OfficeMax), signed an enterprise bargaining agreement for WINC employees claiming that it passed the better-off-overall-test. I doubt it. Harvard Law School graduate, Troy Swan was a candidate for the presidency of the New South Wales law society. He is employed by Platinum Equity which is a private equity firm whose Chairman and CEO, Tom Gores, is a billionaire from the exploitation capital of the world Flint Michigan. Platinum Equity specialises in acquisition and merges driving down costs and wages and maximising profits. With the merger of three of the largest of wholesale office supply companies in Australia the ACCC investigated and gave the green light saying that there was little risk of this merger reducing competition.

In 2017, one of the firms later acquired by Platinum Equity, Staples, had been found guilty of unfair dismissal of four employees making out that they were redundant when in fact they were just simply sacking them.

The employees’ representative argued that Staples approach to redeployment was “little more than a fig leaf”, as there was no realistic or practical exploration of redeployment options.

Commissioner Ian Cambridge said that Staples’ approach to consultation for the redundancies was “unduly hasty and largely tokenistic“.

“Staples management did not engage in genuine or meaningful consultation with its employees and their representatives, but instead made disingenuous gestures which it sought to portray as consultation,” Cambridge said.

Despite this, United Workers Union signed the enterprise bargaining agreement put forward by Troy Swan claiming that it passed the BOOT test.

Conclusions
Private equity firms routinely employ managers and HR people under the condition that they reduce the wages and conditions of the workers below them.

The Fair Work Commission signed off on enterprise bargaining agreements that unlawfully exploited workers at Coles. This decision had a flow-on-effect affecting over 1 million workers Australia-wide. 750,000 workers in Australia are on visas that restrict their work rights;

There are attempts by supermarket chains worldwide to automate the distribution process from warehouses to retail outlets, thus compelling customers to pick out and pay for their purchases. Under automation, gone will be the Coles worker who provides friendly service. She will be replaced by an automated stacking and a soulless check-out machine.

Coles and Woolworths are virtual monopolies, controlling prices at the farm gate and at the checkout in your local supermarket. They have a cosy agreement with the right-wing Catholic union SDA.

In 2018, large American retail chains like Walmart and Amazon paid their workers $US11 and $US15 per hour. The minimum wage in Australia was $A21. Were it not for a labour shortage in Australia, our wages and conditions in the retails sector would be as bad as for workers in the United States.

Ian Curr
6 Jan 2022

References