Toyota has decided to discontinue manufacturing vehicles in
Australia by late 2017. Around 2,500 workers will be made
redundant. Toyota's decision was long-anticipated, Ford and
General Motors have each made similar decisions in recent years.
The Australian Manufacturing Workers' Union
(AMWU) and the Federal Government have each blamed
the other for the death of Australia's large-scale auto
In late 2013, Toyota sought to renegotiate key elements of the
Award (the agreement regulating pay, leave and employment
conditions) in place at its plant in Melbourne. Among 28 other
variations, Toyota wanted greater flexibility to shorten the
plant's annual three week shutdown over Christmas, claiming it
often starved supply to Middle East markets and required expensive
overtime to clear the backlog. The AMWU, which represents 90
percent of Toyota plant workers, objected to Toyota's
proposals. The union claimed Toyota was "trying it on"
and would not pull out of Australia, and on 12 December 2013
procured an injunction preventing Toyota's proposals being put
to workers at a vote. (Justice Bromberg, who heard the issue in the
Federal Court, described the injunction application as raising
"interesting and complicated issues" even by the
standards of Australian labour law).
Federal Treasurer Joe Hockey subsequently claimed that Max
Yasuda, the head of Toyota Australia, had privately told Hockey
that AMWU's litigation and intransigence meant Toyota's
global leadership could not be convinced that significant
efficiencies could be made in Melbourne. However, Mr Yasuda and
Toyota flatly denied that that was what Mr Hockey had been told,
and said its ceasing manufacturing was the result of Australian
market and economic conditions, not labour issues in particular.
For its part, the AMWU denied it bore "any blame at all",
and identified the Federal Coalition Government's "policy
failures" as the cause of Toyota's decision.
Regardless of whether labour issues were indeed the final straw
for Toyota, the complexity of the Toyota Award and the difficulties
encountered in inflexibility of trade unions are illustrative of
the labour-related challenges faced by many manufacturers in
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Long experience representing many of Australia's leading employers has taught us that in employment litigation the identity of an employee's representative is a major factor in how employee litigation runs.
Australian employees receive certain entitlements (such as annual leave and superannuation) where contractors do not.
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