E-Malt.com News article: Australia: Leaked documents reveal Carlton & United Breweries struggling to meet demand due to low production rates

Leaked documents from Carlton & United Breweries have revealed the brewer is struggling to meet demand due to low production rates, skill shortages and "excessive financial and people cost", as its Victorian factory enters the fifth month of a long-running industrial dispute, The Australian Financial Review reported on November 4.

The maintenance review produced just before the Melbourne Cup belies official CUB statements that the company is not at risk of running out of beer during peak season.

It comes as the plant's senior manager, seen by unions as the architect of the dispute, left the company following a wave of new leadership appointments by CUB, whose parent company SABMiller recently merged with global rival Anheuser-Busch InBev.

CUB's Abbotsford plant in Melbourne has been facing a union picket since June after it refused to renew its maintenance contract covering 55 workers and instead offered to engage them under significantly lower pay and conditions.

The brewer has sought to deny the Electrical Trades Union's claims the plant is facing A$2 million a week in production losses due to lengthy machine stoppages and a lack of skilled maintenance staff.

However, a review of maintenance work prepared October 31 for senior management and seen by AFR Weekend confirmed "machine and factory efficiency is low at Abbotsford packaging".

"As a result, to ensure that we can meet the requirements of our customers we are having to work longer hours to achieve the planned volume," the report said.

"The financial and people cost of this is excessive."

The report said the plant had been forced to move planned maintenance to Sundays, copping penalty rates on rostered days off and weekends and suffering a "limited availability of trades to complete corrective, inspection and lubrication work orders".

Graphs also revealed a four-month gap following the retrenchment of the 55 workers where the plant appeared to do no preventative maintenance work.

The time taken to complete maintenance tasks also shot up and the cancellation of work orders is high.

ETU state secretary Troy Gray said the leaked data "clearly shows the deception of the CUB management who have been insisting to us, the media, to the Fair Work Commission and ultimately to their shareholders, that the layoffs have not impacted production".

"We have no idea if the local management have even disclosed to the new owners the true impact of their irresponsible, excessively costly decision to sack the workers vital to their business."

Former CUB machine specialist and one of the 55 workers, Chris Brown, said the revelation CUB failed to do preventative maintenance, which was necessary for both production and safety, was "potentially catastrophic".

"It's pretty dangerous and the most expensive way of running a factory," he said. "You run the risk of having machines failing and parts flying off and hitting someone."

The union has said that even if CUB went back to normal levels it would not be able to meet the doubling in demand in the lead-up to Christmas.

The union and CUB are currently in mediation at the Fair Work Commission, with the brewer recently bringing the next meeting forward from November 16 to November 11.

On November 3, CUB announced general manager of southern operations Gary Woodburn, who heads Abbotsford, was leaving the company.

Mr Woodburn had been a strong spokesperson for the cuts in pay and conditions and told 3AW in September that Abbotsford had lost 30 per cent of production to CUB's Queensland brewery since 2009 because it was not "cost competitive".

"We can't afford for volume to seep away, month by month, year by year, we need to be competitive."

CUB did not respond to requests for comment before publication.

Last week, it said it had listened to union concerns and recently engaged a contractor offering "union-endorsed conditions with competitive rates between A$70,000 and A$120,000 before overtime – well above award rates".


03 November, 2016