Balancing Competing Interests: The Case Of SPC Ardmona

Imagine you are working at the FairWork Commission in the office of the President, Justice Iain Ross AO. Justice Ross has asked you and your team to write a report on one of the recent industrial disputes that has impacted on Australian Employment Relations – the SPC Ardmona dispute.

Your report will form the basis of a lecture he is giving a LaTrobe University, entitled: ‘Balancing competing interests: the case of SPC Ardmona’.
Your team should undertake extensive research from academic journals, books, industry sources and the media and write a Report which addresses the following issues and questions:

1. What was this industrial dispute about? Provide background information to the factors that lead to the dispute if necessary and explain how the dispute unfolded;
2.  What were the environmental factors contributed to the dispute?

The purpose of the paper is discussing a recent industrial dispute that has impinged on Employment relations in Australia namely the SPC Ardmona dispute. In general, SPC Ardmona is an Australian-based company that got possessed by parent company Coca-Cola Amatil. SPC is specialized in the packaging of the large fruit and this is the reason it actively owns and maneuvers a canning factory in Shepparton and Kyabram. It experienced an industrial dispute and that had badly influenced its working and functioning (Our Business n.d.).

SPC Ardoma in Victoria’s Goulburn Valley experiences serious threat. In the words of Peter Kelly, Managing Director, the company goes through severe problems and that came up as a consequence of economic factors on an external basis. The hike in Australian Dollar that got raised from the year 2009 to 2013 caused significant pressure to the company and the way it carried out its operations. It altered the overflow of the cheap imported product that got traded in Australia and lowers the production cost too. Due to this, the company’s export business becomes wiped out.

Later on, the Productivity Commission also came out with their own verdicts that the things go worst on account of high labor costs and allowances. It is being reported and witnessed that the workers were compensated up to 58% and formed above award wage levels plus nine weeks’ paid leave. The things get more of spoilt in a manner that the customers of the company feel collided with (Fact file: Labour costs not to blame for SPC Ardmona's woes 2014).

This creates panic and trouble for the company to continue with its operations at its best. The possible factors behind this particular industrial dispute were an outbreak of natural calamities, availability of cheaper products, and loss of export market share. All these factors altogether slowdown the business operations and led to a reduction of the scale of operations. There stays great necessity to focus on these areas in order to make out a better way.

The above-discussed factor produced a bottleneck for the company and impact its working and functioning in the highest possible manner. Now, the company is really entangled in a vicious circle and there does not seem to be a proper way to get out of it. The dispute passes through odds and evens and that means a lot for the future of the company. SPC Ardoma asks for a grant from the part of the government in order to get out of this terrible situation. Basically, it requires to make business smoothly running and functioning (Price 2007, p. 541).

Environmental Factors

Finally, the dispute unfolded with the aim to make business consider innovation and to make out niche market to mark a better move ahead. This seems to be the most significant step that would back up the business and allow it to recover from such a trough situation. An announcement from the Australian Stock Exchange in relation to the government and CCA’s investments can be heard. It is being viewed that $100m will be right away put to work by our business in order to impel new product and packaging innovation together with the competence measures. Not only this, it gets an effective assistance from the part of the two renowned universities, Melbourne and Latrobe to lend a hand to SPC Ardmona in its R&D and food-technology needs. With this, the company would be able to sustain its presence for a long period of time (Matthewson 2014).

This serves to be the perfect solution in making the situation under control and come back to a perfect shape. SPC Ardoma goes through difficult times and that makes it feel pressure from the part of the stakeholders being it inside or outside. It shows the way industrial dispute greatly impacted the employment connections and looks forward to better management and control as well (Hor 2009, p. 306).

Moving on to the next part, the need is to determine the environmental factors contributed to the dispute. According to this, the industrial relations system and the workplace environment are a big hurdle to the way business confronts significant issues. There is no doubt that in the country like Australia the industrial relations system turn up a curse for employment relations and puts a question mark on its growth and progress (Nankervis, Baird, Coffey and Shields, 2016, p. 107).

The Protected Industrial Action gives an advantage to a union and its members. If the things do not go as per their wish, they can get protection from the industrial action in order to cause damage to the business. In such a situation, the curatives presented to an employer to end the action are inadequate as well. Strikes commonly occurred in an Industrial Relations System. The Content of Agreements does not go well with forming proper connection amid employer and employees. Rather it goes with the different theme and that has nothing to do with forming a better bond in between these two (Sappey, Maconachie, Sappey and Teo 1999).

Conclusion

The industrial relations system seems to be less of supportive and productive enough in getting a hold on the situation faced at the part of SPC Ardoma. The company lacks the way to deal with such a dispute and to make workforces engaged. Employment relations seems to be going bad and dismal. It is very much required to take in proper steps in order to deal with it. Most importantly, an organization has its workers at the core and that serves to be the pillars for it (Towers 2004, p. 412).

In the case of SPC Ardoma, the internal, as well as external environmental factors, created sabotage for the company and that make things beyond control. Lack of government support and unfavorable economic conditions also lead to the massive destruction of the company. At this point, it is very much necessary to figure out the possible reasons behind just to reach the better verdict. It is indispensable to understand the environmental factors in order to make the things back on track (Murphy 2014).

Industrial disputes at SPC Ardoma is a really a big matter to be taken into consideration. After going through different points, the government grants a fund to the company in order to accommodate as per environmental conditions and to make the business grow and excel at an incessant basis. It becomes equally important to focus more on employment relations as it serves to be the key foundation for the business in order to make liaison with its workers. Workforce environment is crucial enough to make plans work out and to draw in fruitful resultants also. In Australia, the industrial relation system demands a revival (Fastenau 1998).

Conclusion

In the end, it can be summed up that the company SPC Ardoma confronts enormous issues and was to face a closure as well. But, due to its unending efforts and attempts, the company recovered and is capable to stand again. Strong employment relations and the power to innovate make the company strong enough to deal well with the challenges and also to make a better move ahead. Along with this, the company started searching for more of niche markets in order to have a distinct position amid its stakeholders. Strong monitoring of the environmental factors is a must in order to realize greater growth and progress. Being a strong example of an industrial dispute, the company struggled hard to get out of this trouble and marked an effective entry in the market.

References 

‘Fact file: Labour costs not to blame for SPC Ardmona's woes’, 2014, viewed 23 July 2014, <https://www.abc.net.au/news/2014-02-17/fact-file-labour-costs-not-to-blame-for-spc-ardmona-woes/5245260>

Fastenau, M 1998, ‘The SPC Dispute: A Case of Manufacturing Conflict?’, International Journal of Employment Studies, vol. 6, no. 1, pp. 103-126.

Hor, J 2009, Managing Termination of Employment: A Fair Work Act Guide, CCH Australia Limited, Sydney.

Matthewson, P 2014, ‘More than one message in SPC decision’, viewed 30 January 2014,  <https://www.abc.net.au/news/2014-01-31/matthewson-spc/5229740>

Murphy, K 2014, ‘Tony Abbott cabinet rejects $25m assistance plea from SPC Ardmona’, viewed 30 Jan 2014 <https://www.theguardian.com/world/2014/jan/30/tony-abbott-cabinet-rejects-25m-assistance-plea-from-spc-ardmona>

Nankervis, AR, Baird, M, Coffey, J & Shields, J 2016, Human Resource Management: Strategy and Practice, Cengage AU, Victoria.

‘Our Business’, n.d., viewed  n.d. <https://spc.com.au/our-story/>

Price, A 2007, Human Resource Management in a Business Context, Cengage Learning EMEA, Bedford Row.

Sappey, RB, Maconachie, G, Sappey, J & Teo, S 1999, ‘Work Intensification and Social Relations: A study of enterprise agreements in the Queensland food processing industry’, International Journal of Employment Studies, vol. 7, no. 1, pp. 105-124.

Towers, B 2004, The Handbook of Employment Relations: Law and Practice, Kogan Page Publishers, Sterling VA.