Calls to investigate logging companies

The Commerce Commission is assessing a union call for two logging companies that went bust owing $26 million to be investigated for allegedly trading while insolvent. PHOTO/FILE

The Commerce Commission is assessing a union call for two logging companies that went bust owing $26 million to be investigated for allegedly trading while insolvent.

First Union took up the fight for 17 truck drivers with Smith and Davies NZ in Whangarei, who lost their jobs on March 16 after parent company Kiwi Forestry International's assets were seized.

The union alleged Smith and Davies NZ breached a collective agreement requiring the company to give redundant workers two weeks notice and one month's redundancy compensation.

In letters to the commission and the Companies Office dated June 2, union organiser Bryce Hamilton said his members were concerned about the legal status of Smith and Davies, HarvestPro, Pounamu, and Kiwi Forestry and their subsidiaries.

He said there was no record of the companies going into liquidation, voluntary liquidation or insolvency in the Companies Office register, yet workers had been made redundant.

Mr Hamilton said the affected workers and the union were not notified of any liquidation or given written confirmation they would be made redundant.

The decision to transfer equipment and staff to Stan Semenoff Logging with continued union membership, without redundancy payment, was misleading and/or deceptive, Mr Hamilton alleged.

"There are suspicions amongst members that a formal investigation may reveal more than this complaint can detail and that the complicated business structures may be the result of tax evasion and regulatory avoidance," he said.

Commission spokeswoman Michelle Vieira confirmed that matters raised by the union were been assessed.

The Companies Office has yet to receive the letter.