Loss-making New Zealand stores diminishing JB Hi-Fi profits

By Paul Hayes

MELBOURNE, VIC: In the wake of last week’s industrial action in Wellington, JB Hi-Fi chief executive, Richard Uechtritz, has told Current.com.au that his company’s New Zealand division is unprofitable and dragging down overall profits.

Organisers of last Friday’s protests, Unite Union, claim to have been negotiating with JB Hi-Fi for the past six months in an effort to increase hourly pay rates.

The union points to the company’s forecast 2010 profits of between $117 million and $120 million as evidence it can afford to pay a higher rate in New Zealand.

But according to Uechtritz, JB Hi-Fi is being unjustly targeted when stores its stores in New Zealand are contributing nothing to the company’s profits.

“They (union organisers) say we are making all this money.

“But we would make even more money if we didn’t have New Zealand.”

He said he the protests also surprised him because JB Hi-Fi pays its New Zealand employees more per hour than the national minimum of NZ$12.75.

“On average they (NZ JB Hi-Fi workers) actually get a lot more than NZ$13.50, when allowances are factored in.”

The JB Hi-Fi chief also said that union comparisons with Australian wages don’t hold up because factors including taxes and cost of living have to be considered.

“It is totally absurd to argue that point.”

Uechtritz said that while JB Hi-Fi will not be swayed by union protests, the company may reconsider its hourly rates if wider changes are made in New Zealand in the future.

“If the minimum wage goes up, then we will look at adjusting ours as well.”

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