Six Darrell Lea staff denied redundancy payments as shell company DL Employment enters liquidation

Updated February 14, 2015 00:05:37

Six Darrell Lea workers face losing $400,000 in redundancy entitlements after a shell company employing them was put into liquidation.

In July 2012, things looked dire for Darrell Lea and almost 700 people who worked for the confectionery maker. Most of the company's staff did lose their jobs as its unprofitable store network was shut.

However, more than 80 jobs were saved when the Quinn family, owners of VIP Petfoods, stepped in to buy the brand and its manufacturing operations.

Part of their restructure was to move the factory from Kogarah in Sydney's south to Ingleburn on the city's outer south-western fringes. That move has been the source of a fresh employment dispute.

"Most of the workforce were happy to go. A small number of the employees, this half a dozen, they're unable to travel to Ingleburn for a range of personal, family reasons," said Lucy Saunders, a legal officer with the Australian Manufacturing Workers' Union (AMWU), which is representing the six staff.

Among them is Steve Perry, 64, who worked at the company for 36 years. He has an eye condition which means he cannot drive.

"If all trains run on time, it's nothing under three-and-three-quarter hours everyday, and then there's still a 1.25-kilometre walk from Ingleburn Station to the factory," he said.

The Darrell Lea business has indicated to us that they will not be paying the redundancies that the Fair Work Commission has ordered.

Lucy Saunders from the AMWU

Ironically, around six years before the takeover, Mr Perry had moved from Raby, a suburb right next door to Ingleburn, to Como in Sydney's south because he felt he was getting to old for the long commute and wanted to live closer to work.

Another of the six workers, Mark McNeil from Kogarah, said he could not work in Ingleburn because the minimum 40-minute drive was too long for him to be able to get home quickly when there is an emergency with his disabled adult sister and his frail 87-year-old mother.

"[My mother] used to look after my disabled sister - my sister had an accident when she was young, 10 years old, on a pushbike," he said.

"Now that mum's too old, it's up to me, I'm the only family member in Australia at the moment."

Darrell Lea 'will not be paying the redundancies'

The union took the employer to the Fair Work Commission arguing that eight workers were entitled to redundancy payments, as they were not being offered suitable alternative employment by being asked to travel to Ingleburn.

The commission found that six of the eight were entitled to redundancies because of their personal circumstances, and the wording of the enterprise agreement.

The employer appealed to the full bench of Fair Work, but the original decision was upheld.

On January 28, the Fair Work Commission gave the employer 14 days to pay the six staff a total of around $400,000 in entitlements that they were owed.

The individual entitlements ranged from more than $50,000 to almost $90,000.

The problem for the workers is that their employer was a labour hire firm, a shell company, called DL Employment.

... if you say you're going to do something, do it. If you owe something, clear the debt.

Steve Perry

In the days after the Fair Work decision, a range of corporate actions took place.

"On the 29th of January the Quinns created a new company, it's called KQ employment Pty Ltd, it's ultimately owned by Klark Quinn, who manages the Darrell Lea site," Ms Saunders said.

"Then on the 30th of January Sinclair Quinn, who is the sole shareholder of DL Employment, placed the company into a voluntary winding up.

"So DL employment is the company the orders are made against, it's the one that technically owes the money.

"The Darrell Lea business has indicated to us that they will not be paying the redundancies that the Fair Work Commission has ordered."

Former employees have 'no hope'

The ABC spoke with the liquidator of DL Employment, Jason Bettles from the Gold Coast office of insolvency firm Worrells.

He said DL Employment has no physical assets, and that its sole director, Sinclair Quinn, told him that there was no money in any of its bank accounts.

Ms Saunders said that leaves the former employees in limbo.

"The six employees are left with a company with no assets, no hope of recovery in the normal course," she said.

The liquidator told the ABC that he is an independent party whose role is to maximise the return for creditors, including by pursuing directors personally if they have breached their duties.

In this case the main creditors are the six employees, and the union says it is considering Federal Court action if the entitlements are not forthcoming.

Mr McNeil, 57, said he had applied for a couple of jobs since, but his caring responsibilities, his age and the ongoing legal battle were barriers to finding a new job.

"I've just been exhausting my savings trying to get by until this court case was finished," he said.

Mr Perry said it should never have had to come to this.

"It just makes you wonder. We as family members, as workers, teach our kids meet your commitments - if you say you're going to do something, do it. If you owe something, clear the debt," he said.

The day before DL Employment went into liquidation, Darrell Lea announced a new sponsorship deal with V8 Supercar racing outfit Tekno Autosport

Topics:industrial-relations, company-news, business-economics-and-finance, food-processing, food-and-beverage, australia, nsw

First posted February 14, 2015 00:02:33

ยง

Updated February 14, 2015 00:50:04

Veteran Liberal MP Philip Ruddock has been sacked as chief government whip in the wake of the failed leadership spill motion, a move one MP likened to the start of "the night of the long knives".

Mr Ruddock, who is currently the longest-serving member of the House of Representatives, will be replaced by Queensland MP Scott Buchholz.

Tasmanian MP Andrew Nikolic, a prominent supporter of the Prime Minister, will also be promoted to a whip position.

On Monday Mr Abbott came within 12 votes of facing a leadership spill and his narrow victory shocked the Prime Minister's loyalists.

Some senior ministers hold Mr Ruddock partly to blame, saying one of his roles should have been to rally support for the leader.

But others believe his job is to act as a sounding board for the backbench and to pass on MPs' concerns to Mr Abbott.

They say if that had happened, the Prime Minister would have been forewarned disquiet was building in his ranks.

When contacted by the ABC, Mr Ruddock said "the position of whip is in the gift of the leader, and any advice about that position should come from him [the Prime Minister]".

'Night of the long knives has begun'

Those willing to comment on the record are few and far between, but in a statement Queensland MP Andrew Laming described Mr Ruddock's sacking as "scapegoating of Godzilla proportions".

Another MP said it had gone down badly in the Liberal Party, and that it displayed a "tin ear to the party room."

A common complaint among Liberal MPs was that the news had been broadcast before they were consulted.

"So much for the new era of consultation," one senior MP said. Another suggested it was "yet another captain's call".

Philip Ruddock career highlights

  • Elected to House of Representatives 1973
  • Minister for immigration and multicultural affairs 1996-2001
  • Minister for immigration and multicultural and indigenous affairs 2001-03
  • Minister for administrative services 1997
  • Minister assisting the prime minister for reconciliation 1998-2003
  • Minister for reconciliation and Aboriginal and Torres Strait Islander affairs 2001
  • Attorney-general 2003-07
  • Chief government whip 2013-15

One senator said "this is nuts", while an MP stated "the night of the long knives has begun".

When asked if Mr Ruddock's departure was linked to this week's leadership spill motion, Foreign Minister Julie Bishop said: "I don't believe there's any connection between the two matters.

"These matters are for the leadership to determine as to who is best placed to act as chief government whip.

"A decision has been made."

Other MPs the ABC spoke to thought it was a good move, saying Mr Ruddock had not done the job well.

Frontbencher Steve Ciobo rejected suggestions the decision was an act of recrimination.

"This reflects a change made by the Prime Minister to reflect feedback that he feels is appropriate in terms of the line-up of personnel," Mr Ciobo told Radio National Drive.

"I think this is a good outcome.

"It just so happens Scott Buchholz has an adjoining seat to me, I know him very very well, I think he's a very sound and solid Queensland Member of Parliament.

"I think he'll do an outstanding job as whip, but by the same token let me also just sing immense praise for Philip Ruddock, the father of the house, a long standing and long serving member of the Australian Parliament."

Prime Minister pays tribute to Father of the House

Mr Abbott is known to have great respect for Mr Ruddock and he paid tribute in a statement confirming the changes Friday afternoon.

"I acknowledge and thank the Hon Philip Ruddock MP for his extraordinary contribution to our country, this Government and the Liberal Party," Mr Abbott wrote.

"As Father of the House, Philip has given over four decades of service to the Australian Parliament and the Australian people.

"He was a senior minister throughout the life of the Howard government and was shadow cabinet secretary in opposition.

"Later this year he will become the second longest-serving parliamentarian in our history."

The move has been under discussion for more than a day.

The two men met after Parliament rose on Thursday.

Topics:liberals, liberal-national-party-queensland, political-parties, government-and-politics, federal-government, federal-parliament, abbott-tony, australia

First posted February 13, 2015 16:59:34

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