Letter to the Editor in Chief of The Australian

1 December 2006

Mr Chris Mitchell
The Editor In Chief
The Australian

Re: Michael Costello Opinion Piece 1/12/2006

Dear Sir

Today’s opinion piece by Michael Costello (Shades of Orwell in Howard’s hard sell) contained a considerable number of errors about the Commonwealth Bank which I believe need to be corrected.

His allegation that employees of The Commonwealth Bank who choose to be employed under the Enterprise Bargaining Agreement (EBA) are in effect condemning themselves to a permanent wage freeze is wrong.

Since 2002 the Bank has unilaterally awarded an annual 4% pay increase, well above the inflation rate for most of this period, to these employees, the latest occurring in July 2006.

Moreover these employees have also been paid each year $1,000 worth of Bank shares, one of Australia’s most secure and valuable stocks.

The Bank will continue the practice of generously remunerating staff who choose to be employed on the Bank’s EBA.

Mr Costello also asserted that our new Australian Workplace Agreement (AWA) did not meet the no disadvantage test. This is also wrong.

Since 1997 the Commonwealth Bank has been offering employees AWAs. In that time about 8,000 of the Bank’s 35,000 employees have made the choice to work on an AWA. All Commonwealth Bank AWAs, including our most recent, meet the no disadvantage test.

Both Mr Costello and the ACTU have also omitted significant facts from their public statements over the past week.

  • The Finance Sector Union was a signatory to the EBA which expressly allowed staff to choose to work under an AWA. They signed off on this five years ago.
  • In doing so the Finance Sector Union were party to the agreement that Commonwealth Bank staff working on an AWA could choose not to receive rostered days off, overtime and separate allowances, meal allowances, leave in lieu of travelling time, on-call allowances, telephone availability allowance, higher duty allowance and annual leave loading in return for a considerably larger base salary.
  • This is the same union movement which this week criticised the Bank for the removal of these conditions in return for much high salary.

In a competitive labour market, the Commonwealth Bank has a vested interest in employees who are happy, engaged and willing to give great service to our customers.

This year the Bank introduced a care package which establishes priority access for staff in nominated child care centres, mothers’ nursing rooms, the capacity for employees to purchase additional annual leave and a raft of other employee friendly initiatives.

The Bank also engages an external company, the Gallup organisation to measure the contentment of its staff and to compare the results to leading banks around the world. The Commonwealth Bank is second on the list of Banks with the happiest staff in the Asia-Pacific region. Moreover ASB Bank in New Zealand is in first place and it is a wholly owned subsidiary of the Commonwealth Bank.

There is nothing to be gained by the Bank being anything other than completely fair in the way we remunerate our people. This is something we are committed to continuing.


Yours faithfully,

Barbara Chapman
Group Executive
People Services

02 93785965 (w) 0400096924 (m)