ACCC allows Victorian chicken growers to collectively bargain with processors on interim basis

Victorian chicken meat growers will be able to collectively negotiate the terms and conditions of growing contracts with processors under interim authorisations granted by the Australian Competition and Consumer Commission, Acting ACCC Chair, Ms Louise Sylvan, said today. 

"The growers and the processors have sought separate authorisations for proposed collective bargaining", Ms Sylvan said. "The interim authorisations will allow the parties to begin the process of negotiating contracts and bring back some certainty and stability in the industry.

"A recent Federal Court decision set aside previously authorised collective bargaining arrangements after an appeal by the Victorian Farmers' Federation on behalf of their member growers on the grounds that the application was not validly lodged.  Since then the industry has effectively been fully deregulated".

The applications have been lodged by Victoria's five chicken meat processors and also by the VFF, on behalf of chicken meat growers.

"The processors have lodged applications for authorisation which do not, for the most part, have the support of their contract growers.  This means that while any authorisation granted would protect the processors' conduct in collective negotiations it would not, where there is no grower consent, protect the conduct of growers.

"Therefore, the ACCC has only granted interim authorisation to those parts of the processors' applications that will be able to work in practice.  These cover contracts negotiated under the previously authorised arrangements, and also the negotiation of new contracts with growers who do support the applications.

"The ACCC considers that the application lodged by the VFF will provide a more effective framework for negotiations as it is supported by a majority of growers.  Interim authorisation is granted to the VFF's application insofar as it relates to collective bargaining.

"The growers want to establish a prescribed timeframe for negotiations which would be enforceable by having the option to collectively boycott processors if negotiations were not finalised by the due date. The growers propose that right could only be exercised after a seven-month negotiating period.

"The ACCC did not consider it necessary to address the collective boycott issue now and therefore has not granted interim authorisation to this aspect of the VFF's application.  It has, however, authorised growers to begin collective negotiations under their proposed framework.  The ACCC will fully consider the growers' application for the right to collectively boycott when it issues its draft determination in the next few months".    

While interim authorisation allows the parties to engage in the conduct while the ACCC considers the merits of the substantive application, a decision to grant interim authorisation is not necessarily indicative of the ACCC's final decision.

"Ideally, the ACCC would like to see the processors and growers develop a single set of arrangements suitable for both parties and seek authorisation for those arrangements. 

"However, the ACCC's role in this respect is necessarily limited by law to separately considering each of the applications submitted to it.  The ACCC has no power or discretion to amalgamate the two proposals into a single set of arrangements.

"The ACCC encourages the processors and growers to consider developing a single set of mutually suitable collective bargaining arrangements and would be pleased to assist in facilitating the development of such arrangements in any way that it can".

This interim authorisation does not compel any party to take part in the proposed arrangements but will provide immunity against prosecution under the Trade Practices Act 1974 for the conduct covered.  Individual growers and processors retain sole discretion about whether they choose to take part in the collective bargaining arrangements.