Issue No 66 | 11 August 2000 | |
NewsSneaky Chubb Forced to Pay RedundancyBy Andrew Casey
One of Australia's big security firms has been told they can't avoid paying redundancy payments when they switch their direct-employees to outsourced contract labour.
Chubb Protective Services has recently adopted a cut-throat strategy to reduce costs and increase profits, by out-sourcing, 'licensing-out' and franchising their security work. The company is part of the British multinational, Chubb Corporation, which last year reported a profit of more than $1 billion in its annual financial returns. Chubb's personnel manager in Australia, Steve Gates, recently boasted to the industry newsletter HR Report that: "with outsourcing you (may) lose control and quality, but you have a higher margin." But a sneaky attempt by Chubb to avoid paying redundancies to their Security Patrol Officers - who had been out-sourced - came to a dead halt this week. The company was forced to pay more than $12,000 to members of the Liquor, Hospitality and Miscellaneous Workers Union (LHMU) in Canberra. Australian Capital Territory LHMU members Peter Merritt and Joe Hudson have, between them, worked for Chubb for 22 years. Peter Merritt has worked in the job for approximately twelve years, and Joe Hudson for ten years In April this year - without any consultation - Peter and Joe were told of a change in their status. The two Security Patrol Officers were told the jobs they had been doing for so long had been 'licenced' back to them. Their ( now former) employer, Chubb, still held the master contract but Peter and Joe were no longer employees, instead they were sub-contractors. Chubb Protective Services tried to have it both ways. They changed the nature of the relationship but argued that as the workers were still doing the same job they didn't have to pay any redundancy monies. Commissioner Ron Jones of the Australian Industrial Relations Commission has now told Chubb they have to pay out the redundancy entitlements - as well as some holiday leave - based on the Security Employees (ACT) Award. Commissioner Jones , in his decision, also noted that because of this desire to squeeze out an extra dollar from their employees the work situation, which had been based on a friendly and open manner, has now been reduced to mistrust and extremely stilted communication.
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