Victorian chicken growers continue collective bargaining

Posted by Josette Dunn on 24th March 2010

The Australian Competition and Consumer Commission has issued a draft decision proposing to re-authorise collective bargaining arrangements put forward by the Victorian Farmers Federation on behalf of its chicken grower members for a further five years.Victorian chicken growers and processors have been collectively negotiating contracts since 2005 under an existing ACCC authorisation that is due to expire shortly.

Authorisation was granted in 2005 following deregulation of the Victorian broiler chicken growing industry. The VFF advises that since the arrangements were first authorised they have been successfully used by some grower groups while other groups are close to finalising contracts.

The arrangements allow growers to form bargaining groups according to which of Victoria’s four chicken processors, Baiada Poultry, Inghams Enterprises, Hazeldene Chicken Farm or Turi Foods they supply.

“The ACCC considers that the collective bargaining arrangements are likely to continue to be of benefit particularly by providing the opportunity for increased grower input into contracts,” ACCC chairman Graeme Samuel said.

Importantly, the arrangements are voluntary for both processors and growers. Individual growers remain free to directly negotiate with their processor if either party wishes to do so.

The VFF sought re-authorisation under the ACCC’s streamlined collective bargaining process. Under this process, the ACCC seeks to issue a draft determination within 28 days of receiving an application and issue a final determination within three months.

Collective bargaining refers to competitors collectively negotiating terms and conditions with a supplier or customer. Without authorisation, it can raise concerns under the competition provisions of the Trade Practices Act 1974. Broadly, the ACCC may grant authorisation when it is satisfied that the public benefit from the conduct outweighs any public detriment.