Two former directors paid themselves nearly $700,000 in ‘redundancy payments’ before their company entered administration without enough money to pay workers’ entitlements.
Heated scenes and cries of ‘shame’ characterised the ACL creditors meeting in Launceston Tasmania this week, as workers demanded answers.
Workers were upset and angry, confronting CEO Ivan James about why two former directors of the company received generous redundancies when they knew the business was in trouble and at a time when workers had cut back to four days a week to keep their jobs.
AMWU National Secretary, Dave Oliver, who was at the meeting and questioned Mr James, said the case was one of the most outrageous he had seen.
“Workers were asked to take a 20% pay cut. In effect their pay cut was used to pay redundancies for the directors while many workers face financial ruin”, said Mr Oliver.
“Even worse, these “redundancies” were paid out of ACL finances in relation to roles the directors had with ACL subsidiary, National Parts, where workers lost all their entitlements when it collapsed last year.
The two hundred and seventy workers stand to lose all their entitlements while two former directors, Michael Sarward and Joe Capuano were paid $400,000 and $265,000 respectively.
Mr Oliver labelled their behaviour as ‘morally corrupt’ and formally asked them to repay the money.
“Workers are devastated. They feel now they have been kicked in the guts by directors who have turned their backs and left them high and dry,” he said.
Worker Tracy Nicholson expressed disbelief that management had been so dishonest.
“He still managed to look at us in the eye at the creditors meeting and tell us we’re all in the same boat - when he’s on half a million dollars a year.”
Ms Nicholson says everyone at ACL is on edge and worried about hanging onto their homes.
“Many of us will be scratching out a living if we lose our jobs with none of our hard earned entitlements to see us through the dark days.
“We asked him ‘How can you sleep at night after what you did?’”
Delegate Garry Budgeon is particularly worried about the workers in their fifties who had been looking forward to putting some savings into their super.
“If we lose our jobs, it’s going to be so hard for a lot of us to find work and we miss out on the chance to top up our super and look forward to a comfortable retirement.
“We are not feeling optimistic, that’s for sure.”
The AMWU is working closely with both the receivers and the administrators to maintain all jobs until the end of September.
While investigations are ongoing, it is unlikely there will be funds to cover entitlements.
Mr Oliver said the GEERS system would not adequately cover what the workers are owed.
“We simply can’t leave this system in place where bosses can just rely on GEERS and engage in behaviour that can only be called morally corrupt – spending money that doesn’t belong to them and getting away with total impunity.”
Mr Oliver said the AMWU will continue its longstanding campaign to reform corporations law and set up a system which guarantees workers’ entitlements in full.