Mill growth won't work without worker inclusion: union

By NZPA

Monday 19th August 2002

The union representing forestry workers is welcoming suggestions that several plants the size of Kinleith may be built to process New Zealand's "wall of wood", but says employers are pursuing a flawed labour strategy.

"The business strategy of contracting out maintenance is a flawed strategy for improving processing," Engineering, Printing and Manufacturing Union national secretary Andrew Little said today.

His union is locked in a dispute with Carter Holt Harvey at the Kinleith plant in Tokoroa where the company wants to cut the 770-strong workforce by a third, including contracting out work done by 190 maintenance staff.

"Contracting out those sort of functions means that part of the workforce is not committed to the industry or the manufacturing plant," Mr Little told NZPA.

In order to build processing, there needed to be greater commitment to developing the skills base, which was already inadequate, he said.

The average age of workers at Kinleith is 49. Contracting out exacerbated the problem.

"It reflects a huge shortage of labour that is skilled in those kind of disciplines. It reflects a failure to invest in training for the future.

"They do it to improve their bottom line, but it doesn't improve their business."

He noted many telcos around the world which had subcontracted maintenance were facing difficulties keeping their basic infrastructure operating.

If Carter Holt was getting a low return "our union has a record of coming to the party on that", he said.

New Zealand's wood production is set to double by 2020. Some $6 billion is needed to develop processing plants and key player Carter Holt says that will only happen if plants become internationally competitive.

Mr Little said his union was not opposed to improving efficiency.

"We know that mill can be run more efficiently and more effectively and we are not opposed to some of the measures to make it run more efficiently. But what we are opposed to, because we think it is a poor business strategy, is the wholesale contracting out of the core functions to the operating of the mill."

Union members have boycotted job advertisements placed by Swedish company ABB, which has won the maintenance contract at Kinleith.

Mr Little said the economics of contracting out would be thrown into question when there was a major breakdown in the plant.

"A longer than usual outage at that plant will have a huge impact on the bottom line, therefore on its economic viability."

Overseas research had shown it to be an uneconomic business strategy, he said.

The union was optimistic more facilities would be built but did not believe unintegrated plants would work.

"If Carter Holt says we should just atomise the operation and contract in anything other than the production labour, then I don't think you could set up three or four mills like Kinleith."

He said the communities where there the wood was growing needed a commitment to an integrated processing facility and a commitment to training and skills at each of those plants.

If, as Carter Holt says, it wanted its workforce to go down a high wage path, then it needed to support a high skill workforce, he said.

The union has taken the dispute to court claiming Carter Holt has failed to bargain in good faith. A decision is expected in a week or so.

But Mr Little said he believed it didn't really matter what the court decision was because "attitudes have been formed and have hardened".

"What really needs to happen is the parties need to get together and start the process of developing some trust and work out a different way of doing things.

"The signals aren't good so far. Every time we approach the company to talk we just get the company's commitment to its original proposal and nothing changes."

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