Originally posted on Political Duo.
Pacific Brands chief executive Sue Morphet has announced that the company will slash more than 1,850 jobs as well as closing seven factories. Well-known for its ‘made in Australia’ labels such as Bonds, Morphet has said that it was a tough decision which has to be made because it was no longer ‘competitive’ for the company to do so on the long term.
The disgust cannot be any stronger on how Pacific Brands went about this whole affair:
1. Workers are warned that if they walked out of their job prior to being given company notice of their retrenchment, they would lose their redundancy pay. Textile Clothing and Footwear Union NSW Assistant Secretary said ‘workers should not be penalised for leaving early if they found another job’. Why should workers who knew that they would be retrenched be forced to work for a company that has little regard for their interests?
2. According to Textile, Clothing and Footwear Union national secretary Michele O’Neil, it does not make sense to ‘close those parts of the business that are profitable’. If O’Neil is right, then, presumably, certain operations, including those that have been scheduled for closure must be commercially viable. This makes the claim that the company’s net loss of $149.956 million a rather weak argument. Perhaps the major factor driving this decision has been lost amongst the reporting and debate. Let us reiterate: It is based on ‘cost-cutting strategy to save the company $150 million a year’.
3. It has also received governmental assistance of up to ‘$17million’ over the past two years. This offshore move to other countries, despite plea from the government, means the company is happy to receive taxpayers money when it benefits them. For a company that calls itself proudly made in Australia, 75% of its manufacturing were already done in South-East Asian countries including China prior to this announcement. By moving more operations offshore, it has shown itself as a corporation that has scant regard for its community – whether to the workers or the suppliers who would be heavily affected by the decision.
4. While Pacific Brands claims that moving their manufacturing operations to other South- East Asian countries including China was motivated by lower cost of operations, the decision to do so is more than just that. It knows that it can relocate its manufacturing bases to these countries because of their less rigorous pro-labour governmental regulations, non-existing or weak trade unions and a distinct lack of respect for worker rights in comparison to domestic Australian labour laws.
As the debate on the global financial crisis rages on, many multi-national corporations will follow the footsteps of Pacific Brands and come up with feeble excuses to slash local jobs or relocate to jurisdictions with weak labour laws. The workers will be at the suffering end, whether the ones who are retrenched or those in developing countries, forced to work for a pittance. Meanwhile, MNCs will continue to pile the blame on other parties or insist on factors outside their control, except themselves, for the ‘difficult’ decisions they have to make.
Ultimately, the global financial crisis will act as a convenient cover for many unethical MNCs to continue its misbehaviour: be it laying off workers at their home country, or moving their plants to countries that continue to exploit workers in the South.