Private equity and labour management in Australia: the case of Myer created by Mark Westcott and Andrew Pendleton

Private equity has been controversial because of its apparent impact on labour and employment. Analysis of the effects has generated mixed results in the literature, and the reasons for this divergence remain unclear. The article considers whether labour regulation, business strategy and the role of labour in the process of value creation moderate the impact of private equity ownership on labour. It does so by examining the case of Myer, one of the largest private equity buyouts in Australia to date. The article examines the range of initiatives taken by management after the buyout. It is found that the business strategy, the state of the business and the nature of labour’s contribution are all key influences on what happens to labour after private equity buyouts. By contrast, the potential to take advantage of the weakening of labour regulation in Work Choices to make major changes was not exploited by management.