Another day, another closure: Pacific Brand’s Gone

Media Release: National Distribution Union
Wednesday March 4 2009

Another day, another closure: Pacific Brand’s NZ workers get the bad news

“New Zealanders must join the chorus of opposition from across the Tasman at the decision of Pacific Brands to cease its manufacturing in Australia and New Zealand and move operations to China and other low waged countries,” says Robert Reid, President of the National Distribution Union.

Last week PacBrands told its Australian workforce that it was closing its Australian manufacturing plants. Today it gave a similar announcement to workers at its Christchurch and Palmerston North factories.

The National Distribution Union represents textile and clothing workers at both plants. A total of 38 workers including 9 salaried staff are employed in Christchurch and 51, including 5 salaried staff are employed in Palmerston North.

Workers at both plants were called to meetings at 2.00 pm today where the company told them of the company’s new manufacturing policy and announced that it was formally beginning the consultation process with the union as required by the Collective Employment Agreement.

“The PacBrands story reads just like a re-run of Feltex and we fear that PacBrand workers will suffer the same fate,” says Robert Reid.

“In 2001 PacBrands was bought from Pacific Dunlop for AUD $730 million by the private equity funds CVC Asia Pacific and Catalyst Investment Managers backed by the Macquarie Bank.

“Australian analysts say that the private equity funds took AUD $100 million out in cash, loaded the company with debt and then sold it on the share market for AUD $1 billion. A cool AUD $370 million profit. At the same time PacBrands told its NZ workers that it could not afford decent wage increases and from time to time forced them onto 4 day weeks.

“Today, PacBrands shares are only worth AUD 17 cents, the banks are breathing down Pacific Brand’s neck and the Australian public are rallying behind calls to boycott the iconic brands marketed by the firm.

“On one hand, like the Australian Unions we want to work with PacBrands to see if there is any way the plants can remain open and jobs can be saved.

“But on the other hand we want to ensure that PacBrands’ workers redundancy payments are safe if closure and redundancy is the final decision.

“The redundancy payments for NZ Pacific Brand workers are very modest. They are just over 1/3 the entitlements that Australian Pacific Brands workers will receive and nowhere near the AUD $4 million redundancy that the former CEO received last year,” Robert Reid says.

“The NDU is demanding that Pacific Brands immediately puts the redundancy compensation in trust to ensure that it is safe for workers if redundancies do occur,” Robert Reid says.

ENDS

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