Sharechat Logo

Work-shy watersiders get $3m bribe to be 'flexible'

By Chris Hutching

Friday 21st February 2003

Text too small?
Lyttelton Port Co and its 65% owner, Christchurch City Holdings, yesterday denied bowing to blackmail from work-shy waterside unions demanding a $3 million payment for more flexible work arrangements.

Although the company has already made provision for the $3 million payment in its half-year accounts and some of the money has been paid out, waterside workers continue to hold out over two final clauses in the employment contract.

Lyttelton Port chairman Barney Sundstrum declined to reveal the sticking points but said he expected the final signing to take place next week. He said the deal would speed up ships' turnaround times.

The simmering four-year industrial dispute came to a head last year when a container shipping service decided to bypass the port because of slow turnaround times, prompting municipal-
owned Christchurch City Holdings to replace the then chairman, Brent Layton, with Mr Sundstrum, who approved the latest $3 million payoff.

Christchurch City Holdings chairman Paddy Austin, a city councillor, said she was pleased with a "tradeoff" that would benefit the company in the long term.

"It was always known there would be a cost in the settlement, especially where anyone is voluntarily retiring or there are redundancies. And if people give away conditions there's usually a cost to it.

"It's not for me as chair of the shareholding company to analyse specific aspects of the industrial agreement but our response is on the larger issue of the strategic direction the company is headed and we're pleased with the early signs," she said.

"Our reaction also gives a lie to the perception that Christchurch city is only in it for what cash it can grab out of the company. We made it clear to the company we want to pursue long-term viability and a good sustainable business practice rather than focus on dividends in the short term."

Waterside workers were reluctant to accept the deal, including a 3% pay rise, and it was achieved only after negotiations involving Council of Trade Unions secretary Paul Goulter.

Ironically, when Mr Layton was sacked six months ago, he had just announced a record annual profit to June 30, 2002, of $16 million and paid the council shareholders a dividend of 11c a share.

Since his departure the share price has fallen from $1.90 to $1.60, wiping millions off the value of Christchurch ratepayers' investment in the port.

In the latest half-year under review, one-off costs, including the $3 million payment, contributed to a drop in after-tax net profit to $4.4 million from $7.8 million in the previous corresponding period.

The dividend payout for the half-year ended December 2002 has been reduced to 3.75c a share, about half of what it normally is.

The company was on track for a full-year pre-tax profit ending June 2003 of about $10 million (after the $3 million payment), Mr Sundstrum said.

He said the port had a solid cashflow and had the advantage of being a practical monopoly.

The company was also paying more attention to upgrading and improving services.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Pushpay buys Colorado rival for US$87.5m
Xero chair to retire early as family’s health comes first
Business leaders quiz finance minister on capacity to spend $12b
House prices are accelerating again, even in Auckland
13th December 2019 Morning Report
Tourists still coming but growth is slowing
Peters backs StuffME merger bid
Supplements, skincare firm poised for reverse listing
NZX, EEX eye carbon auction opportunity
A2 Milk boss steps down, shares fall 7.7%

IRG See IRG research reports