About the campaign

COMPANIES

Who owns our supermarkets and how much money do they make?

New Zealand’s supermarket industry is a ‘duopoly’ of two huge companies – the Foodstuffs group and Progressive Enterprises.

Progressive (Woolworths, Countdown and Foodtown) control 44% of the market and has recently been bought by Woolworths Australia.

Foodstuffs (Pak N Save, 4 Square and New World) has about 56% of the market. Each Pak n Save, New World and 4 Square is owned by a different employer, and those employers together own the wholesale businesses and the house brand, "Pam’s"

The two chains had sales of more than $10 billion between them last year.

Foodstuffs is New Zealand’s fifth biggest company and its profits rose by 7.8% last year. In South Island Foodstuffs, 23 staff earned $100,000 plus last year and one earned over $660,000. In Auckland, 69 staff earned more than $100,000, and the highest paid person only had $550,000 to get by on!

Woolworths Australia is a gigantic company (and the third largest Australian company and biggest retailer Australasia) had a turnover of $A32 billion last year (excluding Progressive Enterprises) and recently announced a 24.3% increase in profits of $1.2 billion dollars (A$1.1 billion). The company expects sales to increase by 8-12% next year.

The CEO of Woolworths Australia, Roger Corbett, takes home $A8.5 million a year – 340 times more than a full time checkout operator.

Supermarkets disproportionately employ migrants, pacific islanders, maori, youth and women who are the lowest earning workers in New Zealand. Compare this with the all white Central Foodstuffs board.

CUSTOMERS

How much do they charge their customers?

 

Product

Australia ($NZ)

NZ

Harris Coffee

$6.71

$7.17

Nescafe Gold 100

$9.28

$9.67

Kelloggs Just Right

$6.08

$7.20

Signature Range peaches in syrup

$1.55

$1.89

Signature Range Olive Oil 500ml

$4.33

$5.40

Milk 2 lt standard

$2.88

$3.25

Panadol 24/20

$3.65

$3.93

Totals

$34.48

$38.51

(Sourced from Woolworths online shopping in NZ and Australia)

One argument that the Australian owners of Progessive Enterprises make is that they can’t pay their workers as much as their Australian workers because their costs and the cost of living are higher there. But any kiwi who has crossed the ditch or has family living in Australia know this is not the case.

You only have to compare the prices of some basic items sold by Woolworths on both sides of the Tasman to see that not only do their Aussie staff get paid more, but their customers get charged less.

With food prices skyrocketing, those on low and minimum wages are hit hardest.

SUPPLIERS

What about the suppliers?

Suppliers to both Foodstuffs and Progressive have been raising concerns recently about the pressure on them to cut their selling price to these companies.

The consolidation of supermarkets into two companies has increased their control of the food supply chain which allows them to pressure suppliers to depress their prices.

One concern suppliers have is the requirement to provide enough product for both NZ and Australia which could put small suppliers out of business.

When you think about how much of your family income you spend at the supermarket – let’s say 15% - and you multiply that by all households – you can begin to imagine what gigantic businesses supermarkets are. We spend over $11 billion at the checkout each year. That means nearly $1 in every $10 spent by individuals, government and businesses each year is spent at the supermarket

WORKERS

How much do they pay their workers?

 

Company

Shop Assistant Adult Rate

Youth Rate

Union membership

Woolworths Australia

$15.26-$16.06 (+ penal rates and overtime)

$6.10-$14.45 (+ penal rates and overtime)

80%

Progressive (New Zealand branch of Woolworths Australia)

$11.11-$12.38

$6.25-$8.20

21% and rising

Pak N Save

$10.25+

$6.25-$8.20

Less than 3%

Between 2001 and 2005 wages increased more slowly in wholesale and retail jobs than the average for all jobs. This means that already low-paid supermarket workers have fallen further behind other workers. Over this four year period, overall wages had risen by around ten percent. But in the retail and wholesale trade sector the increase was only around eight percent, meaning a yearly increase of only two percent. Because the increases were below inflation it meant we had been earning less every year.

Until last year.

Our campaign at Woolworths, Countdown and Foodtown last year that won us a 60 cents an hour pay rise was the biggest pay catch up we’ve had since the 1990’s when the Employment Contracts Act dragged supermarket wages way down.

But there is still a long way to go. A significant proportion of supermarket wages losses came from the removal of penal rates - which most young workers haven’t even heard of. All New Zealand supermarkets are still paying youth rates and it’s time they stopped.

PROGRESSIVE DISTRIBUTION WORKERS

How do they treat their distribution workers?

500 NDU and EPMU members at Auckland, Palmerston North and Christchurch Distribution Centres supplying Countdown, Foodtown and Woolworths supermarkets have been locked out by their Australian-owned employer, Progressive Enterprises (owned by Woolworths Australia) until they agree to abandon their claim for a national collective agreement.

• The lockout follows the indefinite suspension of workers after commencing a 48 hour strike.

• Workers are claiming an 8% wage increase and allowance parity between the four distribution centres.

• Christchurch workers earn $1.80-$2.00 less p/hr than Palmerston North workers with Auckland workers earn 80c-$1 less p/hr.

• The differences in allowances resulted from Progressive closing the Auckland and Christchurch Woolworths distribution centres in 2003 and rehiring the redundant workers on worse conditions.

• These closures ended the Woolworths National Agreement.

• Palmerston North retained their higher pay and allowances as the company could not find another location for a new distribution centre and therefore could not legally rehire workers on lower rates.

• The NDU represent 98% of Progressive Supply Chain distribution workers with the EPMU, 80% of Progressive’s meat processing workers with the Meat Workers Union and 25% of Progressive supermarket workers.

• Woolworths Australia is the largest retailer in Australasia and recently announced a 24.3% increase in profits of $1.2 billion dollars (A$1.1 billion) and expects sales to increase by 8-12% next year.

• Australian distribution, meat processing and supermarket workers earn up to 35% more than their kiwi co-workers (who do the same job) despite food prices being generally cheaper in Australia.

We are calling on customers and communities to support the locked our workers. Donations can be made to the National Distribution Union at the BNZ account: 02-0200-0217968-00 with the reference “Lock Out”.

PROGRESSIVE MEAT PROCESSORS

How much do they pay their meat processing workers?

The Meat Workers union is seeking a 16 month contract with a 12% pay rise which would take workers up to $15.50 an hour in a first step towards pay parity with other workers in the industry.

Progressive want to treat our member’s as though they are supermarket workers and have used this argument to justify paying them the same low wages that they pay their supermarket workers.

The meat processors only earn an average of $13.73 an hour - including an incentive bonus - despite doing the same job and being as productive as other workers in the meat industry who are earning between $18 and $30 an hour.

It is indicative of how the company treats its workers when it took them 100 days to respond to the union’s initiation of bargaining, and only after workers threatened a strike ballot. (Foodstuffs, who own Pak ‘n Save, sourced their meat from companies paying the standard rate.)

The company's final offer was a 3.5% pay rise in the first year and 3% in the second year, despite the fact that the union had dropped additional claims such as overtime, weekend rates and piece-rates for production workers.

Butchers who had worked in Progressive supermarkets for as long as 20 years have recently been made redundant in Auckland to make way for Progressive’s centralised meat factory.