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Call to action: Lufthansa’s Global Tele Sales uses laws to cut wages

Call centre workers at Global Tele Sales (GTS), a wholly owned subsidiary of Lufthansa Airlines, have been offered individual contracts (known as AWAs) under the new federal industrial relations laws that slash their existing wages and conditions. The call centre employs 80 people in Melbourne and is part of the Lufthansa multi-billion dollar network worldwide.

Despite having a collective agreement that does not expire until December 2006, the Company has offered this substandard deal.

In the Company's own briefing they concede that employees' base wages will be cut by up to 10 per cent. Penalty rates are also cut, which is significant for this almost 24 hour operation, with penalties for work on public holidays and Sundays reduced from 100% to 75% and the penalty for work before 7am and after 7pm Monday to Fridays removed completely.

According to the Company's own figures, the removal of these penalties reduces each employee's annual salary by almost 5%.

The combination of these two cuts means that employees lose between 8-15% of base salary under the new individual contracts.

No pay rises guaranteed

The two (2) year individual contracts do not guarantee any pay rises, instead they provide for a "review of wages in January 2008 in line with the most recent increase in minimum wages in the Australian Fair Pay Commission." No-one knows what that will be, or whether there will be an increase, or what the review will bring.

The Company has introduced an elaborate and confusing performance bonus scheme which delivers bonuses ranging from 0% - 4% per quarter. Maximum bonuses are linked to exceeding KPIs (key performance indicators), taking no more than one personal leave day, and never being late for work.

On the face of it employees could earn 16% bonuses each year, but in reality the thresholds for doing so are so high - never being sick, achieving 110% of already high KPIs, and never being late - it is hard to see even the best of the best making the standard.

A breach of discrimination laws?

The bonus scheme unfairly discriminates against workers who get sick, and those caring for elderly parents or children. According to Equal Opportunity Commission Victoria Chief Executive Helen Szoke, it might be a breach of federal anti discrimination laws (The Age - 28 June 2006).

The full analysis of the individual contract offer is available for download below.

No bargaining – no negotiation – not fair

Global Tele Sales claim that it is not putting pressure on employees to sign the AWAs, but in their own documentation the Company makes it clear that:

• The conditions offered are not negotiable;
• The Company will not negotiate a new collective agreement, but if it does it will be on the same or less favourable terms;
• Any employee who doesn't sign won't get Lufthansa travel privileges (which is a significant benefit); and
• If targets for productivity increase and cost efficiencies are not met, "the Company [will have] no choice but to seek concessions from those who have not signed an AWA."

Profits before people – social partnership out the window

This move by Lufthansa comes despite a report by the Company in May 2006 that the Company was expecting an operating result at least on a level of the previous year's 577 million euros. In the first quarter of 2006, Lufthansa group revenue rose by 13.9% and traffic revenue by 12.9%. Although expenses are up due to the oil price increases, the Company is travelling well against its competitors.

In global terms, Lufthansa is doing pretty well, and slashing the wages and conditions of its Australian workforce is a slap in the face for the mainly female workforce, and a completely different approach to the "social partnership" model the Company adopts in Germany.

There is no way the Company could get away with a refusal to deal with staff and their union in Germany; Germany and the European labour laws would prevent this. But this just goes to show that Big Business will do what it likes if there are not laws to protect workers, and Lufthansa is no different.

What can you do

You can show support for the staff at Global Tele Sales by joining our email campaign. Staff are extremely frightened by these developments, they fear for their jobs as the Company has fewer than 100 staff so are exempt from unfair dismissal laws. Email Thomas Bartsch, Managing Director Global Tele Sales and tell him to deal fairly with staff by withdrawing the individual contracts and negotiating a fair and reasonable deal with the union.

Further information

For further information contact Ingrid Stitt, Secretary, Australian Services Union - Victorian Private Sector Branch - 0418 357 440.

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