C2001/2403, Transcript of Proceedings [2001] AIRCTrans 1145 (18 June 2001)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT DRAKE

C2001/2403

COMMUNITY AND PUBLIC SECTOR UNION-PSU GROUP TAX SECTION

and

CHILD SUPPORT AGENCY (CSA)

Notification pursuant to section 99 of the
Act of a dispute re alleged closure of
Hurstville site and relocation of employees
in contravention of clause 6 of the agreement

SYDNEY

11.12 AM, WEDNESDAY, 23 MAY 2001

Continued from 14.5.01

PN230

THE SENIOR DEPUTY PRESIDENT: Thank you, appearances as before?

PN231

MR P. GIRDLER: For the CPSU yes, thank you, your Honour.

PN232

MS C. ARGALL: I appear for the Child Support Agency. With me is MR M. MADIN, MR B. YOUNG, MR T. SUTTON, and MS S. COLE.

PN233

THE SENIOR DEPUTY PRESIDENT: Yes. Excuse me, I have been in other matters all morning, I have to sort my paper out. So have you had any discussions in the meantime?

PN234

MR GIRDLER: Your Honour, if I may start. There haven't been any discussions formally between CSA and the CPSU, however, there has been some correspondence. If you like I would like to start by updating all the events that have transpired since we were last before you. On Friday, about 6 pm, the CPSU received the following fax from Trevor Sutton of the Child Support Agency. It is about a 4-page fax and I would just like to table that if I may.

PN235

THE SENIOR DEPUTY PRESIDENT: I will just read it thank you. Have a seat.

PN236

MR GIRDLER: Sure.

PN237

THE SENIOR DEPUTY PRESIDENT: Yes. Do you wish to tender the document?

PN238

MR GIRDLER: Yes, please.

EXHIBIT #CPSU6 FAX FROM CSA TO CPSU

PN239

MR GIRDLER: CPSU responded by E-mail to this correspondence on Monday of this week. It also faxed a copy of that E-mail to CSA on the Tuesday morning and I would just like to table a copy of that response, please, your Honour.

EXHIBIT #CPSU7 E-MAIL RESPONSE TO CSA FROM CPSU

PN240

MR GIRDLER: Your Honour, in the transcript of the previous hearing you had stated that:

PN241

The Agency has not satisfied me of that the anticipated closure of the Hurstville site and the movement of staff to Sydney office was prompted by legally unavoidable imperative, it had justified the avoidance of the understanding in clause 6.

PN242

It is the CPSU's contention that in fact the Child Support Agency has still not provided any information which in fact meets the requirements of that recommendation. They have made a range of general statements and have provided some very general correspondence which has obviously been sought from the Australian Taxation Office and has made reference to agreements and relocation packages but there has been absolutely no detail provided to support the fact that these things exist or there is no written evidence whatsoever has been provided to the CPSU.

PN243

In terms of your recommendation, it was indeed that any information, correspondence or material in possession of the agency demonstrating an unavoidable obligation or an overwhelming financial other imperative to move site, as has been submitted by the agency exist and is contemplated, as I found, by the agreement, been provided to union in 4 days. We would submit that in fact that has not happened. In fact all we have in fact received is a very general document outlining what CSA proposes to do and would like to do in the way of accommodation without in fact giving us any details to why in fact the closure of the Hurstville site in unavoidable and an imperative.

PN244

So at the bottom of exhibit CPSU6, in the final paragraph it refers to the relocation package including a $2 million incentive payment from the ATO if all relocations are effected within an agreed time frame. That would seem to suggest, your Honour, that in fact the Child Support Agency has a wide ranging agreement in relation to either the closing or moving of a range of Child Support Agency sites and that in fact there is a financial benefit attached as part of this package. That by itself, your Honour, in our view does not constitute any legal unavoidable reason to close Hurstville.

PN245

An argument that just says from the Child Support Agency that in fact it is a bit expensive does not, in our view, get them out their obligations under clause 6 of the Agreement. Yesterday, your Honour, the CPSU met with its Hurstville CSA members to report back on last week's Commission hearing and also put in front of them some of the proposals that the Child Support Agency had put in terms of assistance that they wish to offer. At this meeting a motion was passed and I would just like to table that as my next exhibit.

EXHIBIT #CSA8 MOTION PASSED BY CSA MEMBERS

PN246

MR GIRDLER: Your Honour, it was clear from that meeting that not only did members did not want to leave Hurstville but they don't believe that suitable - that they also believe that, in fact, suitable alternative accommodation is available in the Hurstville region if, in fact, it is really the case that CSA need to move from ATO premises and, as far as we are concerned, that has not yet been demonstrated. There is, for example, your Honour, a second site currently leased by the Australian Taxation Office and soon to be vacated in Butlers Road, Hurstville, which has computer and telephone wiring and PABX already in place; this would be one option.

PN247

We have been trying to get from the Child Support Agency and have been promised on a number of occasions, your Honour, details of investigations they have - they claim to have made in terms of looking at other sites in the Hurstville area; again, none of that information has been provided to the CPSU if, indeed, it exists and I've to say that there is a huge amount of scepticism from our members at Hurstville that any real efforts to find another Hurstville site had even been made. If they have been made, where is it, where is the information? Your Honour, I would also like to take you back to a diagram, CSA2, which listed total outgoings per square metre and listed high priority, low priority and medium priority sites within the Child Support Agency that were being targeted in terms of trying to reduce accommodation costs.

PN248

These accommodation rates were listed as at 8 September, according to the bottom of the diagram. The current situation in Hurstville and, indeed, it was also the case back in September, was that the numbers of staff in Hurstville had been dramatically reduced from 90 to something like about 60 but, in fact, the actual space that was taken up by staff at the Child Support Agency in Hurstville had not reduced, so there was a lot of vacant space in the Hurstville building which the Child Support Agency have been paying for and, indeed, are still paying for. So what we are, in fact, saying is that in terms of this graph and in terms of some of the details regarding the costs of accommodation in Hurstville these could be reduced for a start by, in fact, the Child Support Agency entering into an agreement with the ATO where, in fact, it only pays for the accommodation that it actually needs and requires.

PN249

Again, without any detail from the Child Support Agency about what the current arrangements are, it is difficult to say as to whether or not that is, in fact, possible but it would seem to us that at the moment, if you have only got to look at the place and I was there yesterday, that there is, in fact, a huge waste of space and there is, in fact, a lot of accommodation being paid for which is not required and which is perhaps putting it into that high priority area when it may not otherwise be there. Your Honour, the CPSU submits that the Child Support Agency is being given ample opportunity to demonstrate that the closure of Hurstville CSA is unavoidable.

PN250

They were given that opportunity at the last hearing, they were given that opportunity to provide us this information within 4 days; they haven't done so. They've been unable to demonstrate that the closure of Hurstville CSA is, in fact, unavoidable or, indeed, that there is - it is not possible to find another site in Hurstville. The CPSU therefore requests from this Commission a recommendation that the Child Support Agency retain a Hurstville site for staffing functionality for individual case management of new clients and clients with established debts, as is committed to, in our view, your Honour, by clause 6 of the agreement. If the Commission pleases.

PN251

THE SENIOR DEPUTY PRESIDENT: Yes, Ms Argall, you are now the advocate for the CSA?

PN252

MS ARGALL: Yes, thank you.

PN253

THE SENIOR DEPUTY PRESIDENT: Yes, what is your position with the CSA?

PN254

MS ARGALL: I'm the general manager of the Child Support Agency, your Honour.

PN255

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN256

MS ARGALL: Your Honour, the CPSU maintains that CSA is in breach of the CSA General Employees Agreement 2000. The CSA firmly believes that there has been no breach of the agreement. We have provided information to the CPSU as requested by your Honour, demonstrating unavoidable obligations and overwhelming financial and other imperatives that require the relocation of our people from Hurstville to Sydney CBD. This is in addition, I make the point, your Honour, in response to Mr Girdler's comment, this is in addition to comprehensive briefings provided during the negotiation of the agency agreement about the financial situation facing the agency in the light of the agreement but also in relation to discussions are subsequent to the negotiation of the agreement ranging back virtually from the signing of the agreement and continuously up until some of the formal discussions that took place on notification of the CPSUs concern about Hurstville relocation. We have no alternative, we must move our people to meet the financial obligations to the Government and to our staff under the agency agreement.

PN257

THE SENIOR DEPUTY PRESIDENT: Ms Argall, I thought that the imperative was - rose out of the insistence of the Australian Taxation Office rather than the financial requirements of the agency agreement?

PN258

MS ARGALL: No, your Honour, there were two issues raised at the last hearing. The fundamental issue is around the financial obligations of the agency and we made the point, I think, in the Commission hearing last week that under the agency agreement there was an obligation for CPSU to work with CSA management to achieve the necessary corporate investment savings by which to fund the agreement. That is the primary driving force.

PN259

THE SENIOR DEPUTY PRESIDENT: Ms Argall, my recollection of the proceedings is fairly clear and as I understood the arrangement the survey was done and there was some high expense areas notified, which are the high priority areas identified on the graph and that those areas with such high expenses were targeted as areas to be dealt with for reduction in the future. I think that arose out of a report that was done in September 2000 but that the intention of the agency was to have them on their agenda for attention but that there was no activity of the agency directed towards closure of those branches until the Australian Taxation Office indicated that there was a requirement visited upon the Agency to vacate the premises. Is that not your understanding of the evidence?

PN260

MS ARGALL: Well, I think that is part of the evidence, your Honour, it is part of the circumstances. What was driving that analysis back in September was the need to identify corporate and investment savings necessary to continue to operate on a financially viable basis. Okay, so - - -

PN261

THE SENIOR DEPUTY PRESIDENT: Without the intervention of the ATO and their requirement to move, as I understood the submissions, there wouldn't have been a decision to activate that strategy - well, at least then or now, that the present situation arose out of the - at the instigation of the ATO.

PN262

MS ARGALL: Your Honour, I regret that that is your understandings of the submissions that were made at the last meeting. Certainly from our perspective we were actively engaged in looking at all the areas of expenditure of the agency from prior to the completion of the agency agreement and that continues today. One of our major expenditure obligations is around accommodation. As an organisation of 2500 - - -

PN263

THE SENIOR DEPUTY PRESIDENT: I wasn't suggesting that you weren't actively looking at these matters and had them on your agenda for change but that my understanding was that the decision to engage in the movement of the site arose during the course of the agreement as a result of the activity of the ATO and wouldn't necessarily have otherwise arisen.

PN264

MS ARGALL: I'm not sure that I would put that conclusion on the event, your Honour. As you will see by that exhibit, there are a number of sites identified under high priority areas, medium priority and low priority. That was an analysis undertaken by the Child Support Agency that then became part of ongoing dialogue with the Australian Taxation Office to seek to come to some agreements about their imperators around accommodation and CSA objectives in terms of rationalising accommodation in order to achieve some financial savings. Okay.

PN265

So there has to be, if you like, a meeting of the minds in relation to those discussions. Now, those discussions continued over a considerable period of time and some decisions were made progressively. The first decisions that were made were around vacating our Chermside and upper Mount Gravatt offices in Brisbane and consolidating our Brisbane activities in the CBD of Brisbane. The second decision that was made was around relocating from our existing site in the CBD of South Australia to an alternative CBD site in South Australia.

PN266

There were pressure emerging in relation to Hurstville from the ATO's perspective from, well, from late last year. It may well have been in terms of our understanding of the process, it may well have been earlier than that and we have records of discussion with the ATO dated around December, I think is the date, 7 December a record of a meeting where the ATO did actually identify that there were some pressures in relation to the Hurstville site. At that time, because there wasn't an alternative option for us, we weren't terribly - we weren't involved actively in that discussion.

PN267

So we had to look at alternative accommodation that was convenient to our people and your Honour, I do want to make the point that in every office relocation that we've undertaken in the organisation, we care about the individual staff in the organisation and we have undertaken extensive consultations, not only in terms of a general office consultation but with individual staff members. We can table the extent to which those consultations have taken place in relation to Hurstville and those consultations will continue to take place but if I go back to the issue around, you know, the imperatives of tax, yes, they had some imperatives.

PN268

We also had some imperatives. Our imperatives were around maintaining operational viability of CSA so it wasn't until some options and alternatives were finally discussed in March and culminating in some agreements in April this year that the relocation from Hurstville became a viable option to CSA to realise the financial imperatives of the organisation.

PN269

THE SENIOR DEPUTY PRESIDENT: When did you look at alternative accommodation in Hurstville?

PN270

MS ARGALL: We have actively sought alternative accommodation in Hurstville, your Honour, we certainly - we know what it costs to set up alternative premises in Hurstville because we have done a lot of costings around establishing regional service centres around the country.

PN271

THE SENIOR DEPUTY PRESIDENT: Why haven't you done that?

PN272

MS ARGALL: Because one of our objectors - which is outlined elsewhere in clause 6, your Honour - is to consolidate our collections of port sites in New South Wales to two primary sites.

PN273

THE SENIOR DEPUTY PRESIDENT: How does sit with the indication in the agreement that he CPSU rely on as to providing certainty for employees as to the location of sites over the life of the agreement? It seems to me that these matters that you speak of, Ms Argall, are all matters known to CSA at the time of making the agreement. You enter into the agreement, you know that you have to accommodate the costs of the pay rises that you negotiated, that the entire agency has to manage that process, they there will be adjustments. You enter into a process to identify what those adjustments are but sitting next to that is a somewhat poorly drafted paragraph about which you identify as a comfort but isn't' specified to be such, merely as sort of a context at least.

PN274

MS ARGALL: Yes.

PN275

THE SENIOR DEPUTY PRESIDENT: At the very least, it is a context and that indicates certainty as to location over the life of the agreement. Now, the life of the agreement has got until, what, 2002, another 12 months to go?

PN276

MS ARGALL: Yes, that is correct.

PN277

THE SENIOR DEPUTY PRESIDENT: When was it certified?

PN278

MR MADIN: 25 September last year.

PN279

THE SENIOR DEPUTY PRESIDENT: Well, the report on which a lot of this change has been predicated was 8 September, wasn't it, although did I just invent that date? I have it in my mind from somewhere.

PN280

MS ARGALL: There's a date on this particular analysis. That was when the analysis was actually drawn up, your Honour, but as was submitted at the first hearing, these discussions were embodied in the discussions around the agency agreement.

PN281

THE SENIOR DEPUTY PRESIDENT: You see the inconsistency?

PN282

MS ARGALL: I see the - - -

PN283

THE SENIOR DEPUTY PRESIDENT:

PN284

The intentions and location of our operations over the life of the agreement provides certainty.

PN285

I don't - I mean, I'm not here to discuss your management. Everyone has financial imperatives and if you don't have a lease, you don't have a lease but, you know, it would be interesting sight to see the Australian Tax Office evicting anybody as well. You do have some power as a tenant but in this process you have information that you had a known cost in the agreement. Now, don't you take that into account when you negotiate. You have some report in progress identifying areas of cost savings and sitting with that you have a clause that indicates certainty over sites. Now, it only gives that certainty over sites at best for another 12 months.

PN286

There's no undertaking - even if you put it as high as an undertaking and I don't say it is that - beyond that but I don't see that faced with that - what is if you characterise it as you have I think as a comfort or you characterise it as at least a context, you can't - stop muttering at the bar table please, Mr Girdler, it really annoys me - you can't have a context that is meaningless and if you say that during the course of this change, you simply have a budgetary constraint and to meet it you enter negotiation and no part of negotiation contemplates retaining the site or even looking at the financial arrangements that might be entered into to engage in that.

PN287

For instance, it is not clear to me that any proposal was put to the ATO that your occupation level of that as just inside Hurstville might be reduced and phased out after the 12 months during which is the time of the effectiveness of the clause. Those are matters - I mean, I'm not here to contest in any respect those very serious financial imperatives that you deal with, they are matters that you have to manage all the time. I have a concern though that the documents that the Commission certifies mean what they say, that but if people who come before members of the Commission for certification of those matters, if they have within them statements that give an impression to people, that is an impression that can be relied on and not one that is set aside for very important financial matters even, that are already known to all of the parties that make the arrangement. When you do a deal for a pay rise the cost of the pay rise must already have been known to you if you have engaged in proper management. So they are the matters, just so that you are informed as to what is on my mind, that are engaging me.

PN288

If I was a member of the public who read that clause, messily drafted as it is, I would think that it was likely that those people who had engaged in personal obligations during the life of that agreement would think that they were staying in Hurstville until July 2001, and pre-existing difficulties of the agency would be matters that I would think had already been taken into account. I would expect that only matters that had arisen after that would be matters that would change that arrangement, or be imposed upon the agency to change what is - if at least not its commitment, its comfort. Do you understand that position?

PN289

MS ARGALL: I understand your position, your Honour, but I think but I think there are other issues that were reflected in the agreement that offset that certainty and it does say "some certainty" and, yes, it is a context. It is an operating model. This is how we do business in CSA with out clients. We have certain metropolitan sites that we operate from. We expand - we have expanded recently into regional service centre sites and we provide a visiting centre for clients with the objective of providing face-to-face contact for our clients. There are a few things and I think we mentioned the earlier hearing - the earlier clauses in the agreement - in terms of a requirement for the CPSU to cooperate with CSA in achieving corporate savings - that is embodied in the agreement.

PN290

THE SENIOR DEPUTY PRESIDENT: Yes. What we should be clear about here is that you have to make your corporate savings and the CPSU is under some obligation to cooperate about making them. It does not seem to me that that involves - unless some situation - some basis on which the agreement was made has radically changed - that involves setting aside the basic premises on which the agreement is made. If persons understood that merely meeting the financial commitments undertaken by the agreement itself would mean that all those motherhood statements contained within it were to be set aside, then persons might not necessarily have engaged in the commitment under the agreement. They may well have, but I cannot know that. All I know is that people read the agreement and the agreement is meant, so far as is possible - setting aside extraneous later matters - should be complied with.

PN291

Ms Argall there are some more practical matters that I think might be of assistance to the parties if I engaged in and that would be to hear what propositions may have been put by you to alleviate the discontent of the people at Hurstville and what some of the negotiations about those matters have been and it might be more fruitful if, at least in the immediately time, I heard about those things in conference. What do you think about that proposition?

PN292

MS ARGALL: I am happy to have some discussions in conference, your Honour, but I would like to make the observation that there is a lot of information - exchange of information - over a long period of time which we haven't sought to inundate the Commission with throughout these hearings. I think you ought to be aware, however, that staff are in the Hurstville site between the period of April '99, through to October 2000. New staff being recruited on that site have actually signed an undertaking to relocate to alternative sites should that be necessary. So, yes, there were some intentions and, yes, with the best intent in the world we have tried to keep faith with those intentions about the context in which we operate, but things do change.

PN293

There are also some comments explicit in the agreement about the consolidation within New South Wales. There are also specific requirements of new staff being engaged by the site that there could well be a requirement to relocate to CBD, so I mean I think there are other activities - other pieces of information that we can provide if that is necessary.

PN294

THE SENIOR DEPUTY PRESIDENT: Yes, Ms Argall, I don't think there is any problem. I have no problem with the notification to new staff that those obligations might arise and it seems entirely appropriate. It is the obligations to existing staff that are my concern and as to the best intentions in the world, the thing that troubles me about that is that I have not seen any evidence, apart from your statement that you know already the cost of setting up in Hurstville, that any attempt was made to negotiate a reduced space for existing employees, at least for the remaining term of the agreement, or to occupy new space for those employees.

PN295

Now, you may have had some financial reason not to make that commitment, but I have not seen - it has not been demonstrated to me and I think I indicated that before that - that an inquiry was made in any real sense - estimates taken, etcetera - and that those results if they were adverse were then discussed with the CPSU, or its members. So I think on that note we should go into conference. Thank you, go off the record.

OFF THE RECORD [11.49am]

NO FURTHER PROCEEDINGS RECORDED

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #CPSU6 FAX FROM CSA TO CPSU PN239
EXHIBIT #CPSU7 E-MAIL RESPONSE TO CSA FROM CPSU PN240
EXHIBIT #CSA8 MOTION PASSED BY CSA MEMBERS PN246