Telstra and unions at loggerheads over redundancy benefits

Talks between union bosses and Telstra have hit a stalemate over the telco’s proposed revival of a contentious redundancy offer for laid-off workers.

The unions’ Single Bargaining Unit (SBU) has raised concerns over Telstra’s offer for a 'Transfer of Business', known as ‘Clause 45’, a measure that gives axed Telstra workers employment with one of its subsidiaries without receiving redundancy benefits.

This latest dispute comes amid negotiations between the parties as the unions continue to fight for a new, fair enterprise bargaining agreement (EBA) – including a pay rise.

According to the Communications Workers Union (CWU), the proposed ‘Clause 45’ gives employees the chance to work for a Telstra subsidiary in a role that it “substantially the same and the terms and conditions of employment are no worse”.

However, if accepted, the employment will be terminated with Telstra without receiving redundancy benefits, and employment would commence with the new company. 

If the employee rejects the employment offer, they could be retrenched from Telstra with no retrenchment benefits payable — a rule that is already in place for transfers within the company.

The SBU expressed “disappointment” with the telco, claiming ”aspects of the clause were too vague to give any consideration to”.

In light of the tabled Clause 45, the SBU said it would not be able to accept Telstra’s latest pay offer of a 1.8 per cent yearly rise, which falls short of the initially proposed 2.5 per cent. This marks a lower figure than the original three per cent proposal, which it says was “repeatedly rejected” by Telstra.

The latest dispute follows ‘promising breakthrough’ in negotiations between Telstra and CWU in April, which led to the suspension of a number of work stoppages.

These follow on from Telstra’s decision to let go 9,500 staff by 2022, roughly 10 per cent of its workforce. The telco said it expected to cut up to 6,000 roles by the end of the 2019 financial year, putting it "on track" to reach the previously announced net cost out target of $2.5 billion.

In a statement to ARN, Telstra said the 1.8 per cent offer was an increase  from the 1.5 per cent paid in FY19, adding that it was above the inflation rate of 1.3 per cent. 

“This offer is based on a careful assessment of what will continue to be a competitive and challenging operating environment for us over the next 18 months to two years,” a spokesman said.

On the subject of Clause 45, the spokesman added: “This is an important way for us to retain those with the skills and capabilities we need for the future. It would help ensure we provide every employee with the best opportunity to retain employment with Telstra while also protecting our shareholders’ interests.”

The two parties are due to revisit the issues of pay and Clause 45 within the next two weeks.