Working to Live - Bulletin 8

Superannuation and our wage increase were the key claims discussed at our recent EBA meeting with Qantas management. The ASU National Negotiating Team held another meeting with the company representatives on 17 August 2004 and we also tabled the remaining detailed claims endorsed by ASU members.

At the meeting we discussed:

• An increase in the company's contribution to superannuation of 1% per year for the life of the agreement
• Limitations on the use of labour hire employees and rates and conditions equivalent to Qantas employees
• No random drug & alcohol testing and clauses consistent with the ACTU proposal
• Ability for part time employees to refuse shift extensions
• Cold work allowance for QFCL staff
• A transparent & fair appraisal system for SPG and QFIT
• A fair wage outcome of 6% pay rise on base salary for all staff

As always copies of our detailed claims are available on our website http://www.asu.asn.au/airlines/qantaseba7.html.

Again the company did not formally respond to our claims, they have promised that they will do this at our next meeting on 24 August 2004.

What does Qantas do for super?

One or our claims for this round of bargaining was to increase the contribution to superannuation by the company. Many people are confused about their super as Qantas has many different divisions in their super scheme - and basically the longer you have been with the company the better the scheme you have.

From 1 July 2003, Qantas, without consulting anyone decided to put all new staff into a lesser super scheme than the majority of ASU members. Many ASU members are in Division 3 of the Qantas super scheme - the company contributes around 10.9% of ordinary time earnings to the scheme and staff 5% for a defined benefit at retirement.

The scheme for new starters is for the company to contribute less money - 9% the superannuation guarantee levy, which is the minimum required under the law. The real question for staff in this scheme and in any of the other divisions is whether you will have enough money to live on when you retire.

How much super is enough

In February 2004, the Association of Superannuation Funds of Australia Ltd (ASFA) published research by Westpac on what Australians will need to have in superannuation to survive in retirement. In their research they provided detailed budgets on what singles and couples would need to spend to have either:

• A modest lifestyle in retirement, better than the lifestyle on just the age pension but still only being able to afford fairly basic activities; or
  
• A more comfortable lifestyle in retirement, enabling an older, healthy retiree to be involved in a broad range of leisure and recreational activities and to have a good standard of living through the purchase of such things as household goods, private health insurance, a reasonable car, good clothes, a range of electronic equipment, and domestic and occasionally international holiday travel.

To have a comfortable lifestyle the research showed that retired singles need to spend $32,800 a year and couples around $43,350. This estimate assumes the retiree owns their own home.

A lump sum of $420,000 is needed at retirement to achieve an income of $32,800. The 9% superannuation guarantee levy amount for someone on average earnings after 30 years employment provides a lump sum of $167,000 and about $19,800 p.a. in retirement income - this includes a part pension.

To achieve $420,000 at retirement, most people will need to save at least 12 - 15% of salary over 30 years, a much higher rate is needed if you have less time in the workforce.

If you want more information on retirement and superannuation check out the ASFA website www.superannuation.asn.au.

With these facts it is clear 9% company contribution to superannuation is not enough. The decisions that Qantas made to unilaterally lower the superannuation contribution for new employees will effect those employees standard of living in retirement. Is this fair? Can we afford not to pursue superannuation as an issue in this EBA?

But it is the community standard

That is going to be the answer from Qantas on super - they will say Qantas staff should only get the community standard because that is what most people get.

The fact is though - Qantas staff provide better than community standard customer service and loyalty to create better than the community standard airline - in fact the best airline in the world.

We also have to ask is the community standard good enough. Our redundancy pay is not the "community standard" so why should our superannuation be this way?

What's next?

We will be holding meetings of members very soon to discuss the Qantas claims and our response. It is vital that you attend the meetings in your area to discuss the progress of negotiations and contribute your view to what we should do next in the negotiations.

Profit update

ASU delegates are attending a profit briefing in Sydney with Geoff Dixon today. Watch out for their report on proceedings in the next bulletin.

Related Documents: