Supermarket giant Coles has launched a high-level independent probe into the employment practices of poultry giant Baiada following a string of alleged breaches of the retailer’s ethical sourcing policy at chicken plants across Australia.

Baiada, the owner of dominant supermarket brands Lilydale and Steggles, has been accused of serious infringements of Coles’ expansive Ethical Sourcing Policy, after it allegedly embarked on a campaign of union busting, worker intimidation and sham contracting that has drawn the attention of unions and the Fair Work Ombudsman.

The company, the country’s second largest chicken processor after Inghams, is currently party to multiple cases at Fair Work Australia  following repeated allegations of labour abuses perpetrated on its mostly migrant workforce. Last year, WorkSafe investigators were called in following the decapitation of an Indian worker at its Victorian processing plant.

But under the grocery chain’s guidelines for Australian suppliers, launched last year amid huge fanfare, strongly-worded sections ban workplace bullying and mandate freedom of association and occupational health and safety requirements. The independent auditor is believed to be combing through the policy and was recently spotted by Baiada workers on the factory floor.

If the company fails the audit, Coles — which has rights to the “free range” Lilydale brand — must halt purchases until a program is put in place to ensure compliance.

Crikey has been told of workers that Baiada fingers as “ringleaders” being dragged into one-on-one meetings, with a lawyer present, with the aim of crushing dissent. The notorious tactic often used by United States-based union-busting firms is specifically ruled out in Coles’ policy, which mandates that all workers should be treated with dignity and respect:

“Suppliers will not use (either directly or indirectly) any physical abuse or discipline, the threat of physical abuse, sexual or other harassment, verbal abuse or other forms of intimidation in any of its premises.”

Intimidation of workplace activists is a specific no-no, the document reads:

“Suppliers acknowledge that workers have the right to join or form trade unions of their own choosing and to bargain collectively.”

South Australian National Union of Workers organiser Dave Garland told Crikey the chicken behemoth was often difficult to deal with, in line with the rest of the industry which is notorious for its intransigence.

“The employer has leaned on people to have people resign from the union. This is less about divide and rule tactics than individually singling people out,” he said.

Garland says Fair Work Australia is currently dealing with a backlog of Baiada matters, including unfair dismissal, disputes over casualisation, right of entry provisions and pay-slip fiddles. But the private firm, which apparently has a “no media” policy, was a laggard when it comes to addressing the complaints.

“Some of the issues are reflected in the poultry industry nationally, but our goal is to get Baiaida to the table and that’s been very difficult.”

Last week, Fair Work Australia was presented by the union with detailed records of phone interviews, signed witness statements and other documents such as pay slips, laying bare alleged underpayments, safety issues, workers compensation concerns, union-busting behaviour and other matters.

Concerns about Baiada’s South Australian plant were raised by the union last year, leading to Lateline stories over allegations of bullying, harrassment and unsafe work practices and an investigation by the Ombudsman that involved 30 inspectors raiding five facilities. There were also reports of alleged racial discrimination on SA production lines, made up overwhelmingly of Sudanese migrants.

The Baiada family are fixtures on the BRW Rich List, with their wealth skyrocketing to $372 million following the acquisition of Bartter-Steggles in 2009, leaving them with 35% of the Australian poultry market. General manager John Camilleri’s grandfather, Celestino Baiada, was a Maltese immigrant who arrived in Australia in 1916 and got his start cleaning 30 chickens a day in his bathtub.

Coles, under fire from suppliers and regulators in recent days for slashing the price of its milk to $1 a litre, has previously trumpeted its commitment to ethical sourcing through its decision to introduce hormone-free beef. The Baiada audit is the first step to extending that initiative to chickens.

A spokesperson for Coles, Jim Cooper, did not respond to Crikey‘s specific queries, referring us instead to a letter sent to NUW general secretary Paul Richardson in January that stated the Baiada investigations are “not a public forum that provides third parties with standing to progress grievances about our suppliers”. Baiada did not return calls.

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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