When ninety United Workers Union members went on strike on June 4 at General Mills in Rooty Hill, in Sydney’s outer-west, they knew they were up against a powerful international corporation. But they also began to sense their collective power as workers and union members.
“We don’t care how long this lasts,” one of the striking workers told me. “We’re here for as long as it takes. Another day longer, another day stronger!”
On June 25, the workers at General Mills celebrated a remarkable victory. The company had stubbornly refused to countenance their claims, offering them an average pay rise of just 1.5 percent, offset by cuts to their conditions and new clauses that could see them having to take on more weekend work.
After three weeks on strike, the global food giant backed down, offering a wage rise of 9 percent over three years without any trade off in conditions. The workers also won a $1,500 bonus and protection for all labor hire casuals and contractors who participated in the strike.
The workers, who were members of the United Workers Union (UWU), stood strong. Although they were up against a multinational company, they were not about to beg, or accept the crumbs that fell from the giant’s table. The community rallied behind them. Locals visited the picket line bringing food and solidarity.
Unions from around the country and outside it threw their support behind the United Workers Unions. On June 16, the UWU spokesperson Erryn Creshull chaired an economics forum at the picket line, discussing the crisis of low wages. I participated alongside Frances Chan, a UWU workplace delegate, UWU president Jo Schofield, Australia Institute economist David Richardson, and ACTU secretary Sally McManus.
On June 23, UWU staged a global day of action. Workers around the world responded to the call, using the hashtags #WorkersRaiseWages and #PassOnOldElPaso to call a boycott of General Mills products.
The strikers’ spirits were high. They knew they were standing up for their dignity as workers. They also understood first-hand the strength of working-class solidarity, raising $35,000 from the community. By standing strong, they showed workers everywhere that they don’t have to bear the brunt of manufactured inequality.
As essential workers, employees at General Mills had kept working through the pandemic, despite the risk to their health. When it came time to negotiate a new enterprise agreement, they demanded a pay rise to help them keep up with the cost of living.
As one of the strikers explained during the dispute:
When General Mills came to us and offered us an average pay raise of 1.5 percent, we felt like crying. Instead of crying, we decided to fight . . . one of the managers told us that we wouldn’t go on strike because we live from pay-check to pay-check. Well, yes — we do live from pay-check to pay-check. But we are proud of our work and willing to fight for respect.
A lot has changed in twelve months. Last March, Australia’s prime minister Scott Morrison was praising essential workers to the skies:
Everyone who has a job in this economy is an essential worker. Every single job that is being done in our economy with these severe restrictions that are taking place is essential.
Now, Morrison seems to have lost his ardor for essential workers, and his government has made the suppression of wages burdening our economy even worse.
Earlier this year, the Coalition government introduced the Industrial Relations Omnibus Bill. It was designed to reduce workers’ wages and conditions, allow employers to bypass penalty rates and leave entitlements, and further entrench insecure work. The senate rejected much of the bill — but that hasn’t deterred Morrison.
Industrial relations minister Michaelia Cash has recently confirmed that the government will once more pursue some of the legislation’s worst aspects. This includes provisions that will allow large companies to sidestep existing enterprise agreements by setting up greenfield agreements to cover new projects.
In addition to this, as Fair Work Australia was deciding on the annual minimum wage increase, the government refused to support the push for a raise. You might be forgiven for thinking the Morrison government’s effusive praise for essential workers in 2020 was insincere.
Morrison, Cash, and Treasurer John Frydenberg are fervent believers in trickle-down economics. They want low-paid workers — on wages as low as $24 an hour — to believe that there will be more jobs and better wages if the multinational corporations who employ them receive fatter profits.
The facts tell a starkly different story. In Australia, profits increased across the board by 15 percent over the last twelve months while jobs growth and wages have continued to stagnate. The recession of 2020 translated into personal pain for workers and profit growth for the big corporations. This was particularly true for Minneapolis-based General Mills.
General Mills workers in Australia manufacture products such as Old El Paso, Latina, and Betty Crocker. The firm’s corporate strategy is straight out of the neoliberal playbook. They employ a significant cohort of casual labor hire workers who are desperate for job security. Yet the company is adamant that these workers should be denied the luxury of a permanent job.
During the pandemic, General Mills saw their net sales increase by 5 percent, for a total of US$17.6 billion. This resulted in an operating profit increase of 17 percent. Over the last five years, General Mills profits have risen by 40 percent.
Despite this, the company only offered workers at Rooty Hill an average pay rise of 1.5 percent per year for three years, which was insufficient to keep up with the rising cost of living. The company also recently announced plans to cut up to fourteen hundred jobs worldwide.
Meanwhile, the cost of non-discretionary consumer goods has risen much faster than discretionary ones. Prices for household essentials have gone up by 44 percent over the last fifteen years.
You don’t need to be an economist to understand that there are dire consequences when workers can’t afford to buy what they need, not only for their families, but for the economy as a whole. Wealth doesn’t trickle down in Australia — it trickles up.
To Win Higher Wages, Workers Need to Strike
In his recent Monetary Policy Decision statement, Reserve Bank governor Philip Lowe noted that “despite the strong recovery in the economy and jobs, inflation and wage pressures are subdued.” In 2017, well before the pandemic, Lowe made a similar point, noting a crisis in wage growth. He observed that “it would be a good thing” if workers were prepared to ask for larger wage rises.
Despite the stagnation of wages, Morrison’s government and neoliberal economists have celebrated Australia’s economic recovery. In fact, while business profits may have soared, the economy hasn’t recovered for workers. Capital is gaining strength and power, but working people are finding it harder to pay the rent.
For the disproportionately precarious and low-wage essential workers who kept the economy going in the thick of a pandemic, there’s little to celebrate, and too little money to celebrate with. Labor’s share of total national income has been falling for more than fifty years.
On top of this, the government is accelerating the growth of casual work. It’s a recipe for inequality and hardship. Insecure workers are less likely to take the kind of strike action that the General Mills staff took, because they feel atomized, vulnerable, and in no position to demand better wages and conditions. That’s why the ACTU’s campaign against insecure work is so important.
We need to stand alongside workers who organize collectively through their unions and take action. General Mills showed us that corporations suppress wages because they can. Striking UWU members showed us that by standing strong, strikes can win — for casual workers too, who won protections at General Mills alongside their permanent workmates. When the going gets tough, the only way for workers to win is to get organized in their unions — and to strike.