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THE pay dispute between management and workers at Don KR Castlemaine reflects broader problems with the Fair Work Act, member for Bendigo Lisa Chesters says.
Workers initially rejected the latest enterprise bargaining agreement, in which casual employees would see their pay cut to match the pay available for contracted workers.
Ms Chesters said it was an example of Australia’s contracted worker system being misused.
“It’s happening across the food and processing sector, when a company – rather than paying their workers from a collective bargain – is using workers from a labour hire company,” she said.
“I believe it is wrong a that company can use a third party firm to undercut wages of employees.”
Don KRC also offered to move 200 casual workers to permanent positions should they accept the offer next month, plus at least a four per cent pay rise for permanent staff over two years.
But some casual workers say they will lose their jobs and be replaced with contract workers if they refuse the offer.
The company started using workers on 417 visas to help in peak periods from September last year, with the workers increasingly being used for shift work.
Ms Chesters said the contracted worker system – as well as the temporary work visa system – was being misused by companies.
“We need to look at what is genuine subcontracting and what isn’t. It’s obvious these workers are forming part of their permanent structure, this isn’t a temporary measure,” she said.
“We also need to look at good faith bargaining.”
Labor and the Greens launched a Senate Inquiry into the impact of Australia’s temporary work visa programs on the labour market earlier this year.
Don KRC gave evidence to the inquiry after it was singled out by Ms Chesters, along with two other central Victorian meat processing companies.
The reporting date for the inquiry has been extended into 2016.
Earlier this week, Don KRC managing director Stuart Grainger did not rule out that casual workers would lose their jobs if the agreement was not finalised by December.
He said the company had been upfront with its plans to reverse multimillion dollar losses, and it required greater flexibility to cope with peaks and troughs throughout the year.
Ms Chesters said it was unfair for companies to look to cut wages before other options.