Critical Times

Source: The Guardian 20 August, 2008

Editorial

The media has spilled the beans on a secret Telstra plan to divide and conquer its workforce and to force them into pay-cutting “agreements”. At the same time company CEO Sol Trujillo is getting a $1.5 million boost in pay to bring his total package up to $13.4 million for 2007-08, Telstra has been planning how to keep any pay rise for its technicians, call centre workers and other staff below the rate of inflation. It wants to drag out stalled “negotiations” to wipe more value off the final percentage increase and to drive workers harder to claw back the miserable bonuses to be put on offer.

Slides from the leaked PowerPoint are now available on the net at http://yourrightsattelstra.com/. It was prepared by Telstra’s Human Resources (HR) department and gives a rare insight into corporate strategising in the struggle to keep the profits made by the workers away from their pay packets.

“This plan by Telstra Human Resources to deceive and trick workers has been in operation since February. The documents show that Telstra’s human resources have had no intention of genuinely consulting with staff or taking into account their concerns over pay and conditions,” ACTU Secretary Jeff Lawrence said.

The current enterprise agreement expires next month and the HR documents reveal that Telstra management intends to negotiate the next agreement effectively with itself. Telstra broke off negotiations with unions in July and it is now plain that this was part of a thoroughly worked out plan. Workers not accepting one of the company’s preferred options could be punished with a year-long wage freeze.

Workers can now see that, despite public denials, Telstra has hatched a scheme to sideline unions and roll out non-negotiated, non-union agreements over the next twelve months. WorkChoices is alive and kicking at Telstra. Three options have been worked out to offer to staff; all of them below the minimum demand made by the relevant unions and all of them below the rate of inflation. An estimate made by Trujillo-appointed US consulting firm Bain puts savings from the bottom line at about $37 million.

A graph on one of the slides explains that part of the plan “assumes incentive pay equals productivity gains.” In other words, workers who meet “performance benchmarks” will need to work off the niggardly incentives to be paid. They will not be available under all the “options” to be presented. There is no information about the objectivity or fairness of the merit-based pay system. Telstra has done the sums and admits the merit-based increases will not cost much. Most workers will average just $77 in performance-based pay increases per year. That’s $1.50 a week after tax.

Another slide — “Timing of Company Rate Increase” — lays bare a trick to put back the date for the introduction of the new “agreements” to reduce the effective percentage increase presented in the “take it or leave it” offer.

“If the annual Company Rate increase were to be paid at the first full pay period in November (i.e. 12 November) compared to October 1, the following saving would result in year 1:

Telstra: $3.9m
Telstra Operations: $2.9m
Wholesale: $0.07m

“The changed timing of the increase reduces the 4.5% pay increase to 4%”

Jeff Lawrence noted, “It is appalling that one of Australia’s largest and most profitable companies can engage in this sort of dishonest and unethical business behaviour under our current IR laws.”

We could add that it is a company originally built upon the contributions of the Australian people over decades with the intention of having a publicly owned comprehensive communications network that invested its profits in developing world first, cutting edge technology at the service of the community.

The privatised Telstra has now demonstrated that it has no interest outside of turning maximum profits out of that same community and its workforce. It is pursuing these goals with drive and a good measure of cynicism and manipulation.