November 2007

Tristar Continued - The dispute is over

We followed the predicament of the 'Tristar' employees in our July 2007 newsletter. Now the matter has been fully settled.

In June of 2007, a number of employees had been left without their redundancy entitlements because the company was ordering them to turn up to work when there was no work for them to do.

The reason for this was because it was cheaper to keep the employees at work, than pay out their generous redundancy entitlements, which were four weeks pay for every year they had worked for Tristar. This group of approximately 35 employees had an average length of service of 30 years, and the longest serving in of this group had worked at Tristar for 44 years. This person would be entitled to 176 weeks severance pay plus five weeks notice.

The workers were entitled all together to $3.6 million in uncapped severance benefits under their agreement, whereas Tristar opted to keep them in employment for 12 months, spending up to $1.9 million. Hence it was cheaper to keep the workers employed on the basis that the manufacturing facility needed to remain operating. The Australian Manufacturers Workers Union (AMWU) and the Australian Workers Union (AWU) also claimed that it was cheaper to keep the workers in employment rather then paying them their redundancy benefits.

The managers, the computer programmer, the toolmaker and the safety officer all had no tasks to perform.

Despite the fact that the Australian Industrial Relations Commission terminated the original agreement, the severance arrangements continued to apply until June 2009. This was because Family First in June this year successfully altered to 24 months, an amendment to Work Choices which provided 12 months protection for redundancy entitlements when agreements ended.

On 31 August, 13 employees won a settlement with Tristar to receive their entitlements under their employment agreement.

On 4 September, Tristar agreed to a further 11 employees being paid their entitlements. This will leave only seven employees on the payroll. These employees were allegedly entitled to the same redundancy package due to an exchange of letters.

On Thursday 15 November, the dispute over the redundancy payments was resolved. Tristar agreed to pay three employees from the Marrickville plant their redundancy entitlements and the last of 32 manufacturing employee's will be leaving Tristar on November 30.

There seems to be some dispute as to who actually achieved the result for the remaining employees at Tristar. Workplace Relations Minister Joe Hockey has claimed credit for the payment of the entitlements and has welcomed Tristar's decision. However Martin Schutz from the AMWU did not believe that the decision was a result of the Minister and the Government's efforts. He believes that it was the union who persuaded Tristar to make the redundancy payments and that the Government's legal action had been ineffective.

In spite of this disagreement, Tristar will continue to be prosecuted by the Workplace Ombudsman for breaching workplace laws in the Federal Court. They face a maximum fine of $33,000 per breach.

The Workplace Ombudsman called a psychiatrist Dr Ian Hickie, who stated that there were highly elevated levels of psychological stress amongst this group of Tristar workers. He concluded that these were directly attributable to their exposure to their work environment.

McArdle legal will be following Tristar's prosecution closely and will let readers know what happens in the prosecution.

This article is intended to be general information only. It is not presented as legal advice. Since each legal circumstance is different, no action should be taken unless specific prior advice is sought on that action.

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