Unions stymie Lyttelton at peak time

Chris Hutching

Friday 30th April 2004

A six-day work stoppage at Lyttelton Port Company that was due to begin at midnight last night at peak export time has been estimated to reduce the company's forecast net profit after tax by about $400,000 or 3.5%.

The sticking point in negotiations is the combined unions' demand that the company stop employing permanent part-time workers to provide flexibility for round-the-clock loading operations and win back coastal trade. Although a common practice in many other work places and often sought after by employees, the waterfront unions equate permanent part-time work with casualisation and want to control the ratio of part-timers to fulltimers.

About 240 workers were due to take part in the stoppage.

At least one share analysts has rated the stock a "sell" and expects it will underperform long term. The shares have fallen from a high last October of $2.03 to $1.63 this week.

The company has been dogged by industrial relations problems which crystalised 18 months ago when 66% shareholder Christchurch City Council pressured former chairman Brent Layton to resign and he was followed by former CEO David Viles. This led to accusations that the unions were receiving comfort from some quarters at Christchurch City Council, and it might explain the apparent militancy.

Under the new replacement chairman, Barney Sundstrum, the company last year made a provision for $2.9 million in the accounts to achieve an agreement that would provide the employment flexibilities that the port needs to attract coastal shipping. But it turns out the agreement was only for one year and the new chief executive Peter Davie faces the same arguments again.

Worst hit will be the port's biggest customer, Solid Energy, which estimates that the strike could cost it $3 million. Another 60,000 workers in the Canterbury region are directly or indirectly reliant on the port in a host of transport and related occupations.

Davie said he was always optimistic about a breakthrough but indicated that the company would not give away the flexibilities it has obtained. Services unaffected include Pacifica Shipping, Lyttelton Stevedoring Services and Toll Logistics.

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