C3469/500, Transcript of Proceedings [2001] AIRCTrans 1260 (25 June 2001)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS

O/N 7762
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT POLITES
SENIOR DEPUTY PRESIDENT KAUFMAN
COMMISSIONER BACON

C No 34695 of 2000

APPLICATION FOR SUSPENSION OR
TERMINATION OF BARGAINING PERIOD

Application under section 170MW of the Act
by Yallourn Energy Pty Ltd for an order to
terminate bargaining periods arising in
C No 30890 of 2000, C No 22953 of 1999,
C No 37215 of 1999 and C No 36504 of 1999

MELBOURNE

10.17 AM, FRIDAY, 1 JUNE 2001

Continued from 31.5.01

<PAUL HOWELLS, on former affirmation [10.17am]

<CROSS-EXAMINATION BY MR HENDERSON

PN2711

SENIOR DEPUTY PRESIDENT POLITES: Before we resume the proceedings can I announce that we will sit on Tuesday, 12 June in this matter. We were programmed to sit on the 13th. We will sit on the 12th in addition. And we will sit, if necessary, on Friday the 15th until 1 pm on that day.

PN2712

MR GREEN: I am grateful, Commissioner.

PN2713

SENIOR DEPUTY PRESIDENT POLITES: Yes, Mr Slevin?

PN2714

MR SLEVIN: Just before Mr Henderson recommences, your Honour, just a matter of the - when the evidence commenced there was a discussion about witnesses being excluded. Since that time I have had discussions with Mr Green and we are of the understanding that only two of our witnesses will be cross-examined and in those discussions I have mentioned whether the company would accede to the other witnesses in the union's case attending the hearings and the cross-examination. I understand that there is no objection to that course and I just wanted to alert the Commission of that, given that effectively an order of direction was made. So we would seek to be released from that direction.

PN2715

SENIOR DEPUTY PRESIDENT POLITES: Thank you, Mr Slevin.

PN2716

MR GREEN: Yes, that is the position. On this understanding, as my learned friend will confirm, that so long as it is proposed not to adduce any evidence above and beyond that evidence that is in the witness statements, we don't have any objection to those people who have made witness statements now remaining in Court.

PN2717

SENIOR DEPUTY PRESIDENT POLITES: Does that include those who you propose to cross-examine or?

PN2718

MR GREEN: I think that the only other person it touches, your Honour, is Ms Hyler who has never been in Court, so I don't think it is an issue, your Honour.

PN2719

SENIOR DEPUTY PRESIDENT POLITES: Thank you. Mr Slevin, will you confirm that is - - -

PN2720

MR SLEVIN: Yes I confirm that.

PN2721

SENIOR DEPUTY PRESIDENT POLITES: Yes. Thank you. Very well, well we varied the direction accordingly.

PN2722

MR GREEN: Commission please.

PN2723

MR HENDERSON: Your Honour, does that apply with the ASU witnesses, or not?

PN2724

MR GREEN: Well I have had discussions with Mr Henderson about that and the position is this. He tells me any witnesses who potentially might be called are currently in the La Trobe Valley. I have left it on this footing with him that unless he hears from us to the contrary he can assume that we won't be requiring any of his witnesses to be cross-examined. But I did say to Mr Henderson that our attitude to whether we do need anyone to be cross-examined will depend upon the state of the evidence when we close our case.

PN2725

SENIOR DEPUTY PRESIDENT POLITES: Well, if the issue doesn't arise today, Mr Henderson, let us deal with it when it arises.

PN2726

MR HENDERSON: It doesn't arise today, your Honour, but the witnesses wouldn't be remaining in the La Trobe Valley if they had an invitation in, if I could put it that way. Anyway, I will talk to Mr Green later.

PN2727

SENIOR DEPUTY PRESIDENT POLITES: Well I think you need to consider whether you would be wishing to introduce further evidence beyond that which is that which is contained in the material. And if so, you had better reserve your position.

PN2728

MR HENDERSON: Yes, thank you, your Honour.

PN2729

Mr Howells, yesterday, I was asking you some questions about the proposed dredger upgrade. Do you recall those questions?---That is correct, yes.

PN2730

And you indicated that the unions, I think, had resisted the company using contractors for that upgrade?---That is right, yes.

PN2731

And I think you agreed that the unions had not actually said no to the proposed upgrade, but had sought further information. Is that right?---Well I think we had reached the position where they just hadn't agreed to the upgrade being done by contractors.

PN2732

Can I ask you, in relation to the upgrade, is it the case that what was being proposed was really in two steps, the first step being the actual upgrade of the dredger, the second step being the ongoing maintenance of the dredger after the upgrade?---Well we didn't specifically discuss ongoing dredger maintenance after the upgrade.

PN2733

But is it the case that the ongoing maintenance of the dredger after the upgrade, was in the scope of the contract that the company wished to let?---In terms of the performance based contract, I mean, I established that by giving them a written explanation of what the performance based contract was, and what guarantees may come from a contract of actually doing that work, which may constitute some contract work being done after the upgrade.

PN2734

And the contract work after the upgrade would be maintenance work, would it not?---It would be in the form of guarantees on fixed and moving parts, so it would be replacement work or dealing with failures that might occur. So it wasn't actually preventative maintenance work as such.

PN2735

And would you agree that that sort of work normally would be done by Yallourn's in-house maintenance work force?---Not in terms of a guarantee, no. If a contractor does work and guarantees the work, I would expect the contractor to fulfil that work, as part of the contract.

PN2736

Are you aware of the duration that Yallourn intended for the contractor to carry out that sort of work - the length of time that that was intended that would happen?---We had never tendered the contract, so at that stage, no.

PN2737

So you had no idea?---I had not considered it as such, no.

PN2738

So 20 years would be out of the ball park court?---I would suggest that you would be hard pressed to get a contractor who is going to give a 20 year guarantee on dredging.

PN2739

But would you agree that there was an intention on the company's part that the maintenance of the dredger, following the upgrade, would be carried out by the contractor?---No, the maintenance of the dredger would be carried out by the in-house work force. Only the guarantee work would be picked up by the contractor associated with the contract.

PN2740

All right. Now, in your statement - G5 - which is the first statement, at - I want to take you to paragraph 94 and 108, dealing with the coverage of Yallourn's proposed MX award. In clause 94 you note that the proposed award would exclude employees engaged on executive employment contracts. Do you have that part?---Yes.

PN2741

Now, that - sorry, the proposal there is to exclude employees who are currently on those contracts, is that correct?---That is right, yes.

PN2742

If you go then to paragraph 108 - clause 10.2 would enable employees such as shift managers and team leaders to enter into personal contracts, and if I can just - you don't need to go to the proposed award, but if I can just make the observation for you - that the provision in the proposed award is "managerial employees including shift managers and team leaders". Do you recollect that?---Yes.

PN2743

What managerial employees would there be, other than shift managers and team leaders?---Basically just people in managerial positions, who are managing people.

PN2744

All right. Now, are there any employees to your knowledge who are currently working on an executive contract - an executive employment contract, who would not be within that class of employees - managerial employees including shift managers and team leaders?---You mean as it stands now under EB3?

PN2745

As it stands now?---I believe there are, yes.

PN2746

There are. Now if those employees who don't fit into that category of 10.2 - are they in a position to opt out of their contracts at all?---I don't know what it says in their contracts so I can't really answer that question.

PN2747

Are all the contracts the same?---I have never seen the contracts, so I don't know.

PN2748

You have never seen one?---I have never seen one, no.

PN2749

And in clause 10.2 of the proposed award, and in paragraph 108, you note - well the award notes and you note that, "The employees may enter into these contracts provided they are not disadvantaged. What do you understand by that?---What I understand by that is if they offer a contract, if is for them to make the decision whether they wish to enter into that contract, so they would make the decision themselves as to whether they would be disadvantaged.

PN2750

And in relation to clause 10.2, do you agree that it would be possible for a managerial employee as defined there, to decide not to enter into a personal contract?---I don't believe we could force anybody to enter into a personal contract, and we are not seeking to do that.

PN2751

Well, I will ask you a different question. If you have an employee - if an employee at Yallourn is in for a promotion to a managerial position, which would be caught up by that definition, would they be promoted into that position if they declined to enter into the contract?---It would be very likely offered as a personal contract. If it was advertised, it would likely be offered on that basis.

PN2752

And that basis only?---To be honest, I have not given it any consideration, but I would assume that would be the case.

PN2753

So, it would be either enter into the contract or don't have the job, from your point of view?---Well it would be the personal choice of the individual as to whether they wished to go down that route.

PN2754

But getting the job or not would depend on whether they entered into the personal contract, is that - - -?---No, getting the job or not would depend on the merit based interview that would take place.

PN2755

All right, so if they get the job and then decline the contract, do they still have the job?---I have not considered that as a position, to be quite honest, because it would be made clear to them before applying for the job, that it was actually on the basis of a personal contract. So the decision was theirs to make prior to actually making application.

PN2756

So, if they don't want the personal contract, then they don't have the job?---They don't have to apply for the job.

PN2757

Right. I don't think that is clear. I have no further questions. Thank you.

PN2758

SENIOR DEPUTY PRESIDENT POLITES: Thank you, Mr Henderson. Mr Georgiou, have you any questions?

PN2759

MR GEORGIOU: I do. I was going to go after Mr Slevin.

PN2760

SENIOR DEPUTY PRESIDENT POLITES: If you want to go after Mr Slevin, that is fine. I was just reversing the order from the last occasion.

<CROSS-EXAMINATION BY MR SLEVIN [10.29am]

PN2761

MR SLEVIN: Do you have copies of your statements, two statements?---I have got the copy of the first statement.

PN2762

In paragraph 6, Mr Howells, you start dealing with the question of consult and agree. You gave an example yesterday of the CFMEU using the consult and agree provisions to prevent Yallourn from making progress on implementing the changes it needs to remain competitive. Are you familiar with the discussions over the Silcar Alliance?---Yes.

PN2763

Can you describe what the Silcar Alliance is for the Commission, please?---Do you mean what we propose it to be?

PN2764

That is right?---Basically what we are looking at is an alliance between Silcar and Yallourn Energy to cover the whole of maintenance within the power station area which would result in both Silcar and our own employees working together in a team based structure to cut out that maintenance work.

PN2765

So the maintenance work would be - they would be working side by side but they would have different employers?---That is correct.

PN2766

So the alliance itself isn't a separate legal entity. It is just an agreement between Silcar and Yallourn Energy that - - -?---Yes, that is what it would be.

[10.30am]

PN2767

And they will be working under different industrial relations arrangements as well, won't they, Mr Howells?---I am sorry, what do you mean by that?

PN2768

Well, are you aware that Silcar has a certified agreement?---That it applies to Silcar workforce, yes.

PN2769

That is right, yes. And the employees, they will be working side by side with the Yallourn Energy employees?---That is the proposal, yes.

PN2770

And you propose that those employees will be covered by the MX Award that the company seeks in these proceedings?---This is the Yallourn Energy employees?

PN2771

Yes?---That is correct, yes.

PN2772

And I think you suggested yesterday, that the CFMEU has exercised a veto right over the introduction of those new arrangements. Is that your understanding of where that dispute is up to?---It has raised a dispute with respect to those arrangements, yes.

PN2773

You have read the statement of Bradley Gloucester - - -?---That is correct.

PN2774

- - - that was filed in these proceedings. Can I just remind you that it was on 15 March that Mr Gloucester first raised the Silcar Alliance as part of the disputes procedure in EB3?---He may have mentioned it. I don't know the exact date.

PN2775

Around mid March sound familiar to you though?---Possibly. It could have been around that time, yes.

PN2776

And indeed it is in his statement that he wrote a letter and he was requesting a meeting to discuss the Silcar Alliance. Do you recall that that was the nature of the request made by Mr Gloucester at that time?---I don't recall the nature of the letter, but he may have written a letter.

PN2777

And we can see in the statement - you have also seen that he wrote again on 19 March because he had had no reply to his 15 March letter?---Again I can't be sure on those dates or the letters.

PN2778

Do you recall seeing a letter from the company to Mr Gloucester on 19 March?---There certainly was an exchange of letters.

PN2779

And the nature of the exchange of those letters, Mr Howells, was that Mr Gloucester was asking for meetings to occur to discuss the proposal relating to the Silcar Alliance?---Meetings were already occurring to discuss the Silcar Alliance.

PN2780

Mr Gloucester was requesting meetings in accordance with the disputes procedure, however, with the union representatives?---Mr Gloucester raised the dispute but he didn't state what the nature of the dispute was.

PN2781

SENIOR DEPUTY PRESIDENT POLITES: Mr Howells, it would be much easier if you would answer the questions. Ask the question again, Mr Slevin.

PN2782

MR SLEVIN: Thank you, your Honour.

PN2783

And in Mr Gloucester's letters, he was requesting a meeting over the Silcar Alliance, in accordance with the disputes procedure. Do you recall whether - - -?---I don't know whether he requested a meeting or not. I just know there was an exchange of letters, yes. He raised a dispute and Yallourn wrote back requesting the details of what that dispute was, because the first stage of a dispute is to settle it at a local level, to discuss it with the local representative in order to understand exactly what the issue was. And then the next stage would be to go onto a union representative. So at that stage we hadn't really established what the dispute was about. It made it very difficult for us to understand which direction to go.

PN2784

At that stage - and you are talking about 19 March?---Well, it may have been around 19 March.

PN2785

And then on 21 March, there was a letter from the CFMEU setting out the detail of what the dispute was?---I believe that is correct, yes.

PN2786

And again requesting a meeting in accordance with the disputes procedure?---I don't know whether there was a meeting requested, but I know it set out basically - what it said the alleged dispute was.

PN2787

And then - perhaps - I wonder if there is a copy of Mr Gloucester's statement - if the witness can - - -

PN2788

SENIOR DEPUTY PRESIDENT POLITES: Do you have a copy, Mr Howells?---No.

PN2789

MR SLEVIN: Can you go to BG11? Can you see that BG11 is a letter from Mr Van Der Muelen, in response to the letter of Mr Wandmaker? And it sets out in quite some detail that the nature of the dispute, so far as the union was concerned?---It would appear to, yes.

PN2790

And at the end of the letter, Mr Van Der Muelen says that:

PN2791

Mr Gloucester and I would be happy to discuss the above matters involving the Silcar Alliance with you, at a mutually convenient time.

PN2792

And you see then at BG14, there is a reply - the reply is to Mr Gloucester though from Mr Wandmaker? And at the end of that letter, Mr Wandmaker agrees to meet with Mr Gloucester. Now you are aware that there has been some correspondence since Mr Gloucester's statement was filed in these proceedings? Perhaps to assist, I will hand you a bundle of documents, Mr Howells. I don't have copies of these your Honour. With some luck I won't have to burden you with more paperwork in this case. Do you see on 23 April, Mr Van Der Muelen replies to the letter of Mr Wandmaker?---Yes.

PN2793

And requests a further meeting to discuss the Silcar Alliance. I will give you an opportunity to read it, Mr Howells. I don't expect you to just agree with that. Can you see in that letter Mr Van Der Muelen points out that what he understands is proposed by the Silcar Alliance plan, would be caught by schedule A to EB3, which requires that there be consultation and, in fact, agreement in relation to that contract with the unions, the parties?---That is correct.

PN2794

And the dispute at this time between Mr Wandmaker and Mr Van Der Muelen albeit through the good offices of Mr Gloucester who was receiving correspondence from Mr Wandmaker, was that in accordance with the EB, the unions have to be involved at some stage, and Mr Gloucester would like Mr Van Der Muelen to be involved?---Yes.

PN2795

And that Mr Gloucester felt that he was entitled to have his district representative or his union representative be involved in the discussions at that time. But the company's position was that they didn't want to involve anyone other than the local representatives?---That is not true.

PN2796

The second of the documents I have just handed to you, Mr Howells?---Yes.

PN2797

Is a letter from Mr Wandmaker on 26 April 2001. Have you seen that letter before?---Have, I? Yes.

PN2798

You have. Do you need a chance to refresh your memory about it?---Could I just have a moment to read it, yes.

PN2799

And you see Mr Wandmaker's referring to another requirement in EB3, that there be agreement with the affected work group - - -?---That is right.

PN2800

- - - and that is until the settlement. And he says in this letter that:

PN2801

Clause 7 of the Yallourn Energy Pty Ltd Enterprise Agreement 1997 provides that in relation to routine maintenance work which is currently carried out by Yallourn Energy employees, Yallourn Energy will consult and reach agreement with the affected work group before the letting the contract as contained in schedule A.

PN2802

And Mr Wandmaker says that:

PN2803

So far as that requirement of EB3 is concerned, Yallourn Energy is complying.

PN2804

And he ends his letter by saying to Mr Gloucester:

PN2805

Yallourn will respond to the outcome.

PN2806

He indicates that a ballot will be held of the affected work group and he says that:

PN2807

Yallourn will respond to the outcome of the ballot in accordance with the terms of EB3.

PN2808

So Mr Wandmaker was saying to Mr Gloucester, in response to Mr Van Der Muelen's letter, that he didn't want to have discussions because he was having a ballot at the time?---It was following two avenues, yes.

PN2809

And he wasn't following two avenues, he was saying, "We are taking this avenue, we are going to talk directly with the employees through this ballot process and we don't want to talk to you"?---You seem to have neglected to mention the fact that on 16 February, at the start of the consultation process, I made it clear we were seeking agreement with the unions under schedule A. That letter doesn't seem to be here. And that is when the consultative process started and all the consultation that took place, took place with the union representatives on site, prior to moving on to talking to the affected work groups.

PN2810

And so, it was - so you say you had consultation in February with the union?---I had about five or six meetings with the representatives on site, yes.

PN2811

And were they - what were those discussions? Were those discussions about the Alliance or were those the discussions about the fact that you were consolidating your maintenance contract - you had four contractors in the power station at the beginning of the year, I understand, and you had discussions about consolidating those four into one, which was Silcar?---No, that is not correct. Those discussions were about the Alliance, and that is confirmed in the letter of 16 February, which I gave to all the representatives at that meeting.

PN2812

SENIOR DEPUTY PRESIDENT KAUFMAN: Mr Slevin, to be fair - in the letter of 6 April - BG14, Mr Wandmaker says in the third paragraph from the bottom that:

PN2813

At the completion of individual consultations Yallourn will again consult with the union representatives of the work group.

PN2814

So there is no apparent contention to exclude the union there.

PN2815

MR SLEVIN: Yes, your Honour. Well, I appreciate that. At the time, Mr Howells, Mr Wandmaker was saying to the union, "We don't want to meet with you over your dispute", and the reason he was saying that was that he wanted to deal directly with the employees through the work group system that he had set up?---No, he was seeking to comply with clause 7, which said we had to seek and reach an agreement with the affected work groups. We also flagged that we were seeking the agreement of the unions through their representatives, and only the CFMEU objected to that. Other unions have worked with us down that particular path.

[10.45am]

PN2816

And that was the case - that is actually the case throughout this correspondence, isn't it, Mr Howells? It was the company deciding that they would put off the meetings with the unions under EB3 until after they went through this other process that has resulted in the delay in the Silcar Alliance being finalised?---It made it very difficult when one union wanted to go in one direction and the other unions wanted to go in the other as the ASU were very supportive of the avenue that was being taken with the affected work groups and also individual consultation process that was put in place on a voluntary basis.

PN2817

But yesterday, Mr Howells, it was the CFMEU exercising their veto rights.

PN2818

MR GREEN: I object to that. That is not the representation of the evidence. What this witness said yesterday was nothing of the sort. He said the CFMEU would not consult with the client. That was the evidence. Now, my learned friend was out for part of the evidence. That might have been a part of it. On one view this witness's evidence that he is saying a veto had been exercised.

PN2819

MR SLEVIN: Yes, I must - I was out attending to something my learned friend asked me to attend to at the time that evidence was given.

PN2820

Well, I will put it in those terms then, Mr Howells. Yesterday you were making the complaint under the question of where have the unions used the consult and agree provisions to prevent the company from introducing change. And you used this dispute as one example of where the unions, and in particular the CFMEU, was responsible for holding you up. Is that the effect of your evidence yesterday?---In effect, the CFMEU instructed its members not to get involved in the consultative process which was contrary to the direction the other unions were taking.

PN2821

And at the same time the CFMEU were asking to meet with you over concerns they had over the Silcar Alliance?---And I believe those meetings are in hand.

PN2822

If you go to the second last document in that bundle I handed you?---Can you show me which one? What is the heading?

PN2823

A letter to Mr Wandmaker from Mr Gloucester?---Dated?

PN2824

14 May?---Yes.

PN2825

And Mr Gloucester writes:

PN2826

Dear David, Breach of EB Dispute Procedure. Your letter dated 10 May attempts to suggest that only the CFMEU is in dispute or has concerns regarding the Silcar contract. I would think that I am stating the obvious by saying all my workmates have grave concerns regarding every aspect of the Silcar contract. In my capacity as shop steward and in accordance with our current EB I have attempted unsuccessfully everything possible to have these concerns addressed. Having exhausted all avenues I have contacted my union official, Luke Van Der Muelen, and have requested his and my union's representation on this matter. Luke has since written several letters and made attempts to set up a meeting with you so far without success. We are in dispute.

PN2827

Mr Gloucester says:

PN2828

The next step in a disputes procedure in the current EB is for you to meet with my union official. If you are sincere about adequately addressing our concerns, honouring our EB and getting on with maintenance then I respectfully suggest you follow this agreed procedure. I will be happy to discuss this issue with you.

PN2829

And you see the next letter which is 21 May 2000 which is a letter this time to Mr Van Der Muelen from Mr Wandmaker replying to Mr Gloucester's letter. And can you see there that Mr Wandmaker finally invites Mr Van Der Muelen to contact him as to his availability over the coming weeks so that we can arrange a meeting?---That's correct, yes.

PN2830

So the consultation process is still going ahead. That is where the Silcar dispute is at the moment?---The dispute is going ahead in terms of the arrangements are being made to meet with Mr Van Der Muelen.

PN2831

And if there has been any delay in relation to the Silcar Alliance it falls on the head of the company?---I don't believe so because there was a considerable amount of confusion about what the Silcar Alliance was and certainly Mr Van Der Meulen's earlier letters he suggested that we hadn't consulted correctly, we weren't consulting, but we are actually in the process of consultation at the time. Because the first contract that was let was a consolidation of the four previous contracts which didn't have an impact on the workforce because it was exactly the same work. And there seemed to be some confusion that Yallourn had let a contract without consultation and under those circumstances there was no requirement to enter into that consultation to seek agreement because it was in essence the same contract being re-let. It was only when we came to change the contract.

PN2832

Could I return to that question. If there is any blame for any delay in relation to the Silcar contract it falls on the company's head because the company, even though they knew there was a dispute back in the middle of March about the proposal, refused to meet with the union until this recent letter - the union representative - until this recent letter with Mr Wandmaker?---I don't believe so. I believe there was confusion about what the process actually was in terms of the fact there was consultation taking place and it was so we didn't really know as a business what the dispute was actually about.

PN2833

And how can you blame the CFMEU for holding this up if we constantly asked for meetings and you wouldn't meet with us?---Because we were following the process which was to deal with it on site first and we were also following clause 7 which was to deal with the affected work groups.

PN2834

Can I just - are you aware, Mr Howells, that it has been in the order of seven letters from the union and seven replies from the company and 12 weeks later before we had an offer to have a meeting over this issue?---I don't know the time frame. I mean I can only go by the letters you have put in front of me and as I have not been the one writing the letters - - -

PN2835

Mr Howells, just in paragraph number 8 of your statement - do you still have your statement in front of you?---Yes.

PN2836

You make a comment about EB3 and in the second sentence you say that EB3 was signed by Yallourn in the belief that it would facilitate change and enable the business to move forward. It is the case that you weren't employed by - you weren't at Yallourn at the time that the EB3 was signed, that is the case isn't it?---That's correct, yes.

PN2837

And you say in paragraph number 1:

PN2838

That except where I say otherwise I make this witness statement from my own knowledge.

PN2839

We must assume that you don't make that statement from your own knowledge as you weren't at the company at the time?---Well it ties into paragraph 6 where I say I was informed by Gary Smith.

PN2840

I see. So Mr Smith has explained that to you?---Yes.

PN2841

Have you ever heard EB3 referred to as a fixed term agreement?---Yes.

PN2842

And what do you understand by that?---In that all the terms and conditions were - appear to be from some perspective set at the start and unable to be changed throughout the course of the document.

PN2843

And his Honour put to you that the way enterprise agreements have been negotiated since EB1 at Yallourn is that the parties sit down, discuss what is required for the next relevant period, because they are of different duration, and decide, well, these are the arrangements we need and we will fix those arrangements, and so we know what the rosters will be, we know what numbers we need to man those rosters, and then at the end of that agreement we will re-negotiate and on that basis the changes are introduced. Does that reflect your understanding of how enterprise bargaining is worked at Yallourn Energy?---Well, as I wasn't involved in EB1 and EB2, I can't really comment, but I don't say as that is an unfair assessment of it.

PN2844

And to that extent, and in particular EB3 was made for 18 month duration, not so much to facilitate change during the life of EB3, but to set out what would occur during those 18 months?---EB3 was the first EB though under privatisation, operating in a commercial market, so there was a different expectation.

PN2845

Well, I put it to you this way; EB3 indeed facilitated change. It facilitated change from EB2; do you agree with that?---Well, it would be different from EB2, but I have never seen EB2 so I don't know all the detail.

PN2846

I understand that you really only - Mr Smith didn't go into this sort of detail with you when he provided you with this information?---In terms of what?

PN2847

It seems that your expectation is that EB3 would facilitate ongoing change during that 18-month period?---That is what I was led to believe, that that was the purpose of EB3 when it was signed. That was the belief of the company at that time.

PN2848

And I am putting to you that it wasn't an ongoing change, it was to facilitate change at the introduction of EB3?---No, the belief was it would facilitate change throughout the course of EB3 to react to market conditions.

PN2849

And I think I said the length of EB3 was 18 months; it was a two-year agreement, EB3, Mr Howells, so I hope I haven't confused your answers as a result of that?---No, no.

PN2850

You go on in your first statement, Mr Howells, to deal with EB3 and the various impediments that you say were imposed on the business. EB3 is attachment 1 to your statement, I understand; do you have - - -?---I haven't got a copy here, no.

PN2851

You don't have a copy of your - - -?---And I haven't got a copy in here either.

PN2852

Do you have EB3 now?---I have, yes.

PN2853

Can you go to schedule B, in particular B1 - B2.1 rather?---Yes.

PN2854

Now, in your statement you complained that B2.1 and B2.2 amount effectively to fixed manning clauses. First of all if we can go to B2.2. It says operational minimum staffing numbers, and:

PN2855

Yallourn W Power Station Operations Group shall consist of the following:

PN2856

And it sets out there numbers of employees by reference to roster patterns. You describe that as a fixed manning position, Mr Howells. I want to put it to you it is not a fixed manning position. It is a minimum manning provision and it is designed solely to ensure that those particular rosters have enough people assigned to them to ensure they operate correctly?---It is my understanding that - whether it is minimum it is still fixed. It is still a fixed number.

PN2857

Well, it is fixed as far as you cannot go below that number. It is not fixed as if there must be those numbers at all times?---Well, I would still describe that as fixed if you can't go below that number.

PN2858

Well, perhaps that is an easier way to deal with it. When you say fixed do you take no issue about whether the company is required not to employ more than the number?---Well, what it is saying is it can't employ less than that number.

PN2859

Yes, but you are not complaining that it is a restriction that the company is required to have only that number and cannot have more than that number?---So what you are saying, the company can have more but it can't have less.

PN2860

That is right?---Well, it would seem that that would be the case there, yes.

PN2861

Okay?---But it is still fixed as a minimum.

[11.00am]

PN2862

And you say - so that we are fair - you say the same thing about the mine operations area which is C1.2 and C2.5, and can I put to you again that these are minimum - they are fixed minimums, but they are not fixed as in you can't have more?---What it is saying is you can't have more again, but we still can't have less because it is fixed at a minimum point.

PN2863

You see, Mr Howells, from your statement you seem to be suggesting that these minimum manning requirements or these manning requirements are a total restriction on the employment practices in those two areas. I want to suggest to you that if, for instance, to fix the excessive overtime problem that you have you wanted to employ more than the minimum numbers, you could do that?

PN2864

SENIOR DEPUTY PRESIDENT KAUFMAN: Mr Slevin, his complaint in paragraph 10 is that they can't employ less.

PN2865

MR SLEVIN: Sorry?

PN2866

SENIOR DEPUTY PRESIDENT KAUFMAN: His complaint in paragraph 10 seems to be that, having regard to these mannings, they can't employ fewer employees.

PN2867

MR SLEVIN: They - sorry - can't?

PN2868

SENIOR DEPUTY PRESIDENT KAUFMAN: His complaint in paragraph 10 of his statement:

PN2869

With respect to these positions, the fixed manning provisions in EB3 effectively prohibit Yallourn from employing less employees.

PN2870

So that is what he said in his statement, it seems to me, speaking for myself.

PN2871

MR SLEVIN: Yes.

PN2872

SENIOR DEPUTY PRESIDENT KAUFMAN: He is not complaining about not being able to employ more.

PN2873

MR SLEVIN: Elsewhere in the statement, your Honour, there are complaints about overtime, excessive overtime being worked.

PN2874

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes.

PN2875

MR SLEVIN: And it is suggested - and it is not specifically - - -

PN2876

SENIOR DEPUTY PRESIDENT KAUFMAN: And you are going to that, are you?

PN2877

MR SLEVIN: I started at paragraph 10, I appreciate, your Honour, but I am moving on to that.

PN2878

SENIOR DEPUTY PRESIDENT KAUFMAN: You are going to that, thank you.

PN2879

MR SLEVIN: Do you understand the question, Mr Howells? I am suggesting that the fixed and minimum manning provisions - that the manning provisions are not fixed so as to prevent you from putting more employees on to alleviate what you describe as excessive overtime?---It doesn't prevent us putting more on, but it just fixes the minimum.

PN2880

Now, in relation to what was discussed during the negotiations on this issue, I suggest to you that during negotiations in mine operations there were agreements reached to allow reduced manning in mine operations and in particular reduced manning on the dredges; are you aware of those?---I am not aware of any agreements being reached.

PN2881

When you say you are not aware of any agreements, are you aware of something else?---Well, I am aware that the unions were saying we could probably operate with less numbers, but it was still a fixed minimum.

PN2882

But the numbers would accommodate the company's desire to have fewer people on those rosters?---But it still wouldn't alleviate the fact that the company would still be locked into fixed manning.

PN2883

But a different number would be agreed to depending on the rosters proposed or agreed to in the negotiations?---Well, a different number was being suggested by the unions, but as I say, it still inferred fixed manning.

PN2884

And in paragraph 15, and here you are suggesting that you have - as a result of the minimum manning requirements you have problems in the mine in relation to training. The training that occurs in the mine largely occurs on the job, occurs on site; that is the case, isn't it, Mr Howells?---I don't know the detail of how and what the manning - the training arrangements as such in mine operations.

PN2885

Well, you suggest at paragraph 15 that you do know. You say:

PN2886

If mine operators are required to undertake training or attend meetings during their shift, other operators often need to be called in on overtime to ensure fixed and minimum manning levels are maintained.

PN2887

?---Yes, that is on the basis if there is some short duration training to be done, often they have had to call people in for a full 12-hour shift to actually cover that training.

PN2888

Well, I want to suggest to you, Mr Howells, that that doesn't occur, that if there is short term training to be done the mine operators simply leave their post, ensuring that it is safe to do so, attend the training and then return to their post on their allocated machine without the need for other operators to be called in on overtime?---So are you suggesting that their fixed and minimum manning levels are not really required?

PN2889

I am suggesting - - -?---Because they are operating below that level.

PN2890

SENIOR DEPUTY PRESIDENT POLITES: Mr Howells, I would be grateful if you would simply answer the question, not make an assumption about where the question leads and try and answer what you think that might be.

PN2891

Ask the question again, Mr Slevin.

PN2892

MR SLEVIN: Thank you, your Honour.

PN2893

I want to suggest to you that the way it operates is that during a shift if training is required, short term training, an operator will leave their post during that shift, go and do the training, and then return to their post without the need of another operator being called in on overtime?---It will really depend on what levels of coal we have in the bunker at that particular time.

PN2894

But that happens, doesn't it?---It will on some occasions happen, but not on all occasions.

PN2895

And you are suggesting, are you, that on occasions where there is a problem with the level of coal in the bunker, someone might be called in on overtime?---That is possibly the case, yes.

PN2896

It is a possible case?---Well, it is the case that somebody will be called in on overtime or the training will be cancelled.

PN2897

Or the - that is right, or the training could be cancelled. So the company makes that choice as to - has that choice, whether to cancel the training or call someone in on overtime?---It has that choice, yes.

PN2898

SENIOR DEPUTY PRESIDENT KAUFMAN: Mr Slevin, I would be assisted if you could explain what is meant by short duration training. I don't know if that means five minutes or two hours or what.

PN2899

MR SLEVIN: Well, Mr Howells, short duration training courses can be two hours, four hours, within the term of the shift?---Yes, that is correct; it could be two hours, four hours, of that level.

PN2900

And so in that respect, the minimum manning in the agreement where it requires, depending on the configuration of the machines being used on the shift, that 26 posts be filled, it doesn't mean that those 26 posts be filled for the entire duration of the shift, it just means that there be 26 people available on the shift?---On some occasions they will drop below that minimum, but on other occasions they will insist on running to that minimum.

PN2901

Yes, but what I am putting to you is that for - what the agreement means is that you simply have the people available on the shift - - -?---Not necessarily.

PN2902

- - - and if you want to utilise them in training, you can do so without needing to bring someone in on overtime?---Not on all occasions. As I say, on some occasions people will be happy to do that, where on other occasions they insist that the minimum manning actually out on the machines is maintained.

PN2903

But that is not a requirement of the EB. That would be a requirement of, what, the individuals on the shift; is that what you are suggesting?---Well, the EB will say that they have got to have that many people to operate those systems, so if those systems are operating, they will on occasions insist that they have that number of people there.

PN2904

Now, in relation to the power station and how training occurs in the power station, the rosters in the power station actually provide for training day, five training days per annum?---That is correct.

PN2905

And it is open for the company to say to an employee we are organising a training course and you are required to do that and you will do that in accordance with - out of your training day allocation?---The company can do that, yes.

PN2906

That is how that works. And you suggest in your statement that the problem with this training is that the company has been unable to do that - or has not been doing that, but has instead been paying people on overtime to come in and do training. You are the manager of the power station, aren't you, Mr Howells?---That is correct.

PN2907

Why is it that you are - well, first of all, who is it who makes that decision about how the training is done and how it is allocated to employees?---That would be done by the operations manager.

PN2908

Have you inquired of your operations manager why they are not using training days in that this circumstance that you describe that you have to pay overtime has arisen?---Yes, I have spoken to him about that.

PN2909

And what have they said?---What he said basically is we can utilise the training days to a certain extent, but where we would be required to do blanket training where we might require 10, 12 or even 15 people to come in on one occasion to attend a course, say, to do with safety or something like that, it is very difficult to be able to accommodate 10, 12, 15 people all on training days at the one time, in which case we have to pay overtime and we will also have to pay overtime to take people off shift to attend the training because we would have to back-fill those positions.

PN2910

And how often does that happen, that you would need to have 12 or 15 in a training course?---We are endeavouring to do it now because we are moving on to the new safety rules, and we have looked into the cost of actually doing that; even if we utilise all the training days, it is going to cost in the region of $250,000 in overtime just to accommodate that training.

PN2911

And this is an exercise that you have at the moment and you have recently circulated to your employees in the power station that two training days for each station operator - and there is 72 operators - be taken in a block training of two days and each block training will have 10 or more operators carrying out training and that they are all required to utilise their training days. Is that the process you are talking about at the moment?---It would be preferable if we could conduct that training at no cost.

PN2912

And you are attempting to do that and you have notified the employees that that is what you will be doing?---I have discussed that with the operations manager, yes.

PN2913

Well, do you know whether the operations manager has implemented that by notifying the employees? I am suggesting to you that he has?---I don't know whether he has or not. I mean, we have just discussed the cost associated with achieving the objective in the time frame.

PN2914

Now, in paragraph 22 of your statement you describe the four units in the power station and the units are separated into two stages, and there are two control rooms for the two stages. It is the case, isn't it, that the technology in the two stages is completely different?---No.

PN2915

No; you say it is not. You say - well, perhaps I will take a step back. The technology is different though, isn't it?---In what way?

PN2916

In that it requires different training to start with to operate?---Well, it is only a familiarisation training associated with the panels and the operation.

PN2917

The control and protection systems are different between the two stages, aren't they?---The control and protection will be slightly different, but the operation is not going to be radically different.

PN2918

And the boiler ancillary plant is different?---The layout of the plant is different.

PN2919

And the generators are different?---In what way?

PN2920

Different layout as well?---It is not a significant issue though.

PN2921

It is significant enough that there are different training courses for the two?---There will be different training courses for the two, yes.

PN2922

And it is four months that the training courses - to complete those courses take four months?---I don't know the duration of the course, but what training course are you talking about? Train to do what?

PN2923

To operate the control room?---From what position are you in though? I mean, are you talking about a unit controller needs four months training to move from one stage to the other?

PN2924

Well, perhaps I will ask you what you are talking about in paragraph 22, Mr Howells. You are saying that operators in the two rooms perform essentially the same work using different control panels. Are you suggesting unit controllers there?---That is correct, yes.

[11.16am]

PN2925

The unit controllers that are required to do four months' training?---Four months' training - I am confused. Are you saying an assistant unit controller would have to do four months' training to become a unit controller?

PN2926

No, I am saying that a unit controller not familiar with stage 1, who is working in stage 2, would have to do four months' training to have the required training to operate stage 1?---I do not believe they would need four months' training, no.

PN2927

Why don't you believe that?---Because I have already inquired and eight people have already become - they have already worked in stage 1 and stage 2 and they had between two and four weeks' training to achieve that objective.

PN2928

Between two and four weeks' training?---Yes.

PN2929

And that two to four weeks' training, that is refresher training, so that would be training done following or to refresh an operator who has done the four months' training as a unit controller at some other time?---No, I inquired about that as well, and even Mr Wandmaker, who is in the court today, he told me he was on stage 1 and he had about three to four weeks' training before moving to stage 2.

PN2930

But did he say to you whether he had done the initial course in relation to stage 2, the initial four-month course?---He told me he had three to four weeks' training to move from stage 1 to stage 2.

PN2931

But in any event training is required to move an operator from one stage to the other?---Yes, I would agree that training would be required to achieve that.

PN2932

Now, you suggest in paragraph 22 that the operators in the different stages are unwilling to work in the other stage. Let me put to you, Mr Howells, that is not the case, and indeed during discussions for EB4 when this issue was raised the unions agreed that provided the training was done that they would be happy to work across the two stages?---At a certain level, yes.

PN2933

In paragraph 24, Mr Howells, you deal with the industrial dispute that occurred in January or February of last year. It is the case that during that dispute when the power station was not operating that you took the opportunity to do major maintenance work; that is the case, isn't it?---There was some maintenance work done, yes.

PN2934

And some of that work was the sort of work that can indeed only be done on the rare occasion when two or more units are down. I refer to stack work and work on the cooling towers, and work of that nature?---Yes, that is correct.

PN2935

And that is fairly intensive work and it needs a lot of operators in to ensure it gets done in the window of opportunity that is available for it?---I would not suggest it would need a lot of operators; I would say it would need maintenance. It would need operators to provide permits to actually do that work, but not a lot of operators.

PN2936

But operators are still required though, and indeed maintenance people are required as well. And as a result of those needs there was a lot of overtime?---Certainly some of the overtime was due to the fact that there was work ongoing, but some was also due to fixed and minimum manning requirements being met.

PN2937

And in relation to the fixed and minimum manning requirements, did you utilise the de-manning provision in clause B7 of EB3?---I believe that was utilised, yes.

PN2938

So even though you believe it was utilised, do you know whether it was utilised?---It was utilised, yes.

PN2939

So how did it come about then if - and perhaps just to assist, the de-manning provisions in the agreement, Mr Howells, actually relieved you from the minimum manning requirements in circumstances when there is a shut-down of units and, depending on how many units are not operating, there is a reduction in the number of manning levels, and that is how the de-manning provision works?---No, it reduces the number of minimum manning, but nonetheless it still has minimum fixed manning levels in there; they just change.

PN2940

But they are reduced, so you had - did you inquire why it was that you needed to use overtime to cover those posts in those circumstances?---I asked the shift manager why we needed to use overtime and he told me that certain individuals said we had to comply with that fixed manning provision that was in the enterprise bargaining agreement associated with the units that we shut down. But I will accept that there was some overtime incurred by people doing work.

PN2941

Well, let us break that down, Mr Howells, and go first of all to the question of whether you needed those number of operators. I want to put to you first of all that this minimum manning requirement was not a burden on the company because those operators were fully utilised because they were required because of the maintenance work that was being performed, the permit work?---No, I would disagree with that. You would not need that many people to provide service for permits.

PN2942

How many people are you talking about, Mr Howells?---Well, if you look at the numbers there, it is a very slight reduction in terms of an operating unit as against the unit that shut down.

PN2943

If we go to the second aspect of your answer, and that is that you had to utilise overtime - well, perhaps to clarify, first of all, simply meeting the minimum manning requirements does not require you to utilise overtime. You can put people on on ordinary hours to perform those tasks, to meet those - - -?---I am sorry, I am a bit confused by ordinary hours?

PN2944

Well, on their usual shifts?---Well, people would be on their usual shifts. It would be where gaps appeared in those shifts and they were insisting on the fixed and minimum manning requirements being met. It also negated any opportunities to do training because of the fixed and minimum manning

PN2945

In January and February?---Yes.

PN2946

Well, let us go to the question of gaps occurring in the roster, and that is what requires - that is why overtime was utilised. During that period you are suggesting that those that were rostered on became unavailable?---That is correct, and because of the fixed and minimum manning there was an insistence that overtime was utilised to fill those gaps, even though we had absolutely no plan whatsoever running.

PN2947

Well, there was no specific insistence. As a matter of course, you filled those gaps in the roster?---No, I talked to the shift manager and he said he did make inquiries at times as to whether we needed to actually comply with that de-manning clause in there, on the basis that we had got absolutely no plant running. And he said the individuals insisted that we did comply with that de-manning clause and fill those posts.

PN2948

In the circumstances of that dispute, did you consider whether you were entitled to use the provision in the disputes procedure that says during a dispute you can essentially stand down employees who cannot be utilised because industrial action is occurring?---We gave consideration to that, to stand down - - -

PN2949

And what was your conclusion in that regard?---In terms of the actual looking towards standing down, we did at one stage make application to the Commission, I believe, with respect to that.

PN2950

And what happened with that application, Mr Howells?---I am not sure where the application went, but I do not think it was actually followed through on.

PN2951

In paragraph 27 of your first statement, Mr Howells, you say that:

PN2952

In mine operations shift arrangements may not be changed without consultation and agreement, and in practice the unions use this provision as a veto.

PN2953

Do you have a specific example of when the unions have used this provision as a veto?---Well, just recently we looked in mine operations with respect to introducing safety discussions at the commencement of each shift, and notified the shifts of that, that that is what we intended to do, and they immediately pointed to the fact that this was changing the shift arrangements without consultation and agreement.

PN2954

Did you have consultation and agreement about that?---We were not actually changing the shift start and finish times; it was basically the employees on the ground who had elected to start at an earlier time themselves, and we wanted to go back to what was the agreed time to actually facilitate that training, or that safety discussion at the start.

PN2955

So you have - what are you saying was the veto then? The veto was not about any changes to shift arrangements; it was changes - it was about whether there was a safety meeting?---They were actually inferring that we were changing the shift arrangements; the shift start and finish times were being changed, which was not necessarily the case, and were seeking to block that from happening.

PN2956

So they sought to do that but did they achieve it? Have you not proceeded on that basis because you feel that you are restricted by clause C2.6 in the agreement?---There were some issues with respect to that but I believe it was actually resolved eventually.

PN2957

So that is not an example of the unions using this provision as a veto?---They did prevent the safety meetings taking place initially, but eventually the matter was resolved.

PN2958

Is that the only example you have of what you say in paragraph 27?---With respect to changing the shift arrangements or in any area of the business?

PN2959

Well now, I want to be specific in relation to mine operations area shift arrangements. Go to paragraph 27, Mr Howells?---I have got paragraph 27.

PN2960

Have you got that in front of you?---In the course of this - of the EB discussions, yes, there was veto used in order to try and prevent shift arrangements being changed.

PN2961

Now, I want to put to you, Mr Howells, that no, that was just part of the negotiations. The company had a proposal that they wanted new shifts in the mine and the union said, well, we would prefer not to have those new shifts in EB4; we have a different preference. And it was not a case of saying - of vetoing a proposed change that you wanted to implement, it was just part of the negotiations?---They would refuse to change?

PN2962

Yes, in the negotiations?---But nonetheless, they refused to change, as part of the negotiations.

PN2963

And through the course of the negotiations - and you say in paragraph 29 what you wished to implement, that you wished to implement a five-leg family shift roster - in the course of the negotiations in mine ops, the unions have agreed that you can implement that shift roster?---I believe there was an agreement in principle with respect to that shift roster, yes, but not with respect to the 1 by 12 shift roster.

[11.30am]

PN2964

I understand, Mr Howells, that the second issue that you say is not agreed is agreed, that the unions have put to you in relation to the 1 by 12 roster that the unions agree with the unions - the company's proposal as well?---I'm not aware of that agreement.

PN2965

So you are not aware whether there was or was not agreement?---As far as I'm aware, there was no agreement.

PN2966

And how are you aware of that?---Through discussions which took place during the day which I had some involvement with with Mr Mether who was the Mine Operations Manager.

PN2967

Right. But you are not on the mine operations LCG?---No, but I do liaise with Mr Mether because the nature of the shift change also impacts on the maintenance area which I was involved with.

PN2968

Now, in paragraph 32, Mr Howells, you are still dealing with the impediments in EB3 as part of your statement, turning to the last two sentences:

PN2969

EB3 clause 1 foreshadowed moving to a five-leg family roster, but unions will not honour this.

PN2970

And this is an example of where the company relied on goodwill to make changes, but was thwarted. Have you still got EB3?---I have, yes.

PN2971

Now, go to B1, can you see that B1 sets out that the main changes, and there are dot points there, are as follows. The third dot point is a move to a five-leg team roster. Is that what you were referring to?---Yes, that's correct.

PN2972

You call it family roster rather than a team roster, Mr Howells, does anything turn on that distinction between those two words?---It's just semantics, to be quite honest.

PN2973

And now can you go to B5.1.1, and you will see that B1 with a preamble, and that B5.1 deals with roster arrangements. B5.1.1 sets out the roster arrangements for the power station?---Yes.

PN2974

And they are the roster arrangements that are currently being worked in the power station, aren't they?---That's correct.

PN2975

Yes. And so your statement that the unions will not honour this provision of EB3 is incorrect, isn't it, Mr Howells?---Your neglecting to point out the fact that the results are of a relief team which actually makes it six-leg team roster, because if you move on to B5.1.2 it identifies that there is a five-leg team roster concept where there will be a relief line which is a sixth line. So it's a six leg team roster.

PN2976

So are you saying to me that EB3 actually provides for a six leg roster?---Well, that's what it seems to do to me.

PN2977

So you are saying in your statement that we have not honoured EB3, the unions have not honoured EB3?---Well, it says that they're going to move to a five-leg team roster.

PN2978

And you are saying that - are you saying a five-leg team roster is something other than what is set out in the roster arrangements in EB3?---There are six teams.

PN2979

But there are six teams because the agreement sets out that there will be six teams, five teams and a relief team?---But it says they're going to move to a five-leg team roster. That hasn't happened.

PN2980

They say in the preamble that they will move to a five-leg team roster?---Yes.

PN2981

In the agreement the roster arrangement is set out and the agreement calls it a five-team roster with a relief line?---But that's still six teams and that's not how I view a five-leg team roster.

PN2982

Can we confine it to whether you say that we have honoured the requirement in B5.1 in relation to roster arrangements.

PN2983

MR GREEN: Well, with respect, that misrepresents the evidence. What the evidence is in terms is EB3 foreshadowed moving to a five-leg roster, family rosters. My learned friends equate what was foreshadowed with the requirement. In that respect, he misleads the witness.

PN2984

SENIOR DEPUTY PRESIDENT POLITES: I am not sure that that is right, Mr Green. I think the question is fair.

PN2985

MR GREEN: If the Commission pleases.

PN2986

SENIOR DEPUTY PRESIDENT POLITES: Would you ask the question again, please.

PN2987

MR SLEVIN: Do you recall the question, Mr Howells?---Sorry, can you repeat the question, please.

PN2988

What I am asking you is simply in relation to roster arrangements in B5.1 can you tell me whether you say the unions have honoured that agreement?---I don't interpret it that way.

PN2989

That those rosters - - -?---Because I think you've got to read it in conjunction with B5.1.2 which says there is a relief line, which I see as a six-leg roster not a five-leg roster, because there are six teams.

PN2990

Now, I want you for the moment to address my question, which is simply reading B5.1 the heading, Roster Arrangements, paragraphs that follow, those rosters were implemented at the beginning of EB3. That is what I am putting to you, simply that?---So you're asking me to read B5.1.1 in isolation to be 5.1.2, because I'm a bit confused.

PN2991

No, I am asking you to read the roster arrangements as a whole, as you understand them?---Again, I don't interpret it that way. I see it as a six-leg roster because there is a relief team.

PN2992

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, that was not the question, Mr Howells. The question was: has the roster arrangement spelt out in B5.1.1 and onward - - -?---That is the roster arrangement, yes.

PN2993

- - - been introduced?---Yes.

PN2994

MR SLEVIN: Yes. How do you say the company has been thwarted?---Because it was the responsibility of the Ops Working Party to move to what I believe would be a five-leg team roster and that's basically the five family shifts that Yallourn sought throughout the negotiations.

PN2995

Well, Mr Howells, I want to put to you that the unions honoured EB3. They implemented the rosters that were agreed, that there was not agreement that there would be some further roster arrangement put in place in EB3 and that the company has not been thwarted.

PN2996

SENIOR DEPUTY PRESIDENT POLITES: Well, Mr Slevin.

PN2997

MR SLEVIN: Yes, I understand.

PN2998

SENIOR DEPUTY PRESIDENT POLITES: There are at least three questions there.

PN2999

MR SLEVIN: There are three questions there. I want to put to you and I think I put the first of the propositions to you, Mr Howells, but I put to you that there was no agreement that any other roster be implemented in the power station - - -?---The roster - - -

PN3000

- - - during the life of EB3?---The roster is not the issue. It's whether it's a five-leg or a six-leg team. Whether there are five teams or six is the issue, not whether the roster - how the roster looks. When Yallourn put together its attachments through the Commission under a section 99 in September of 1999 we actually put together what we saw as a five-leg team roster and the unions rejected that and they responded in writing by saying we still prefer to work our six-leg team roster.

PN3001

Now, well, Mr Howells - - -?---Which indicated to me that they were also of that view as well.

PN3002

Mr Howells, I am talking about the life of EB3. There was not an agreement in EB3 to do anything other than work the rosters that are proposed in B5.1?---And I interpreted it differently and certainly when I read Mr Heyes statement he interpreted it the same way as I interpreted it as well.

PN3003

Now, and then you go on in that answer to refer to proposals put in the negotiations for a replacement agreement?---Yes.

PN3004

And indeed, the company introduced or suggested that what be introduced is a five-leg family roster?---That's correct, yes.

PN3005

And am I right to say that the distinction between a five-leg family roster and the rosters currently being worked in the power station is that the relief line does go?---That's correct, the relief line or the sixth leg disappears.

PN3006

And in the negotiations in Power Ops there was no agreement reached in the discussions about those roster arrangements?---That's correct, yes.

PN3007

In paragraph 48, Mr Howells, you give us some numbers about the - relating to the voluntary redundancy package. Now, first of all, I just want to ask you something, EB3 clause 6.1, perhaps if you could open that for me, you see there under Security of Employment:

PN3008

It is agreed that the life of this agreement there shall be no forced redundancies.

PN3009

The voluntary departure program shall operate only until 14 days after the date of certification of this agreement.

PN3010

What was the voluntary departure program?---Well, I assumed it was some other voluntary - I mean, it's before I actually arrived at Yallourn, so I assume it was the previous package that was in place at that time.

PN3011

And when you - and you indicated that there is now a voluntary separation package in place and how long has that package been in place?---I can't remember the exact date, but it's a three-year so it would probably be August 1999 it was put in place.

PN3012

Yes. Thank you. So the VSP is different from the VDP and you can't help us whether it is in name only?---I don't know what the detail of the previous package were.

PN3013

Now, you give us some figures that 40 employees have taken VSPs?---That's correct, yes.

PN3014

And there are 31 employees who applied for a VSP. Now, am I right in saying that the reason - the 31 employees are either power operators or mine operators, I think you are saying?---Yes, they're in areas of fixed manning.

PN3015

And that is just the mine operations and the power operations?---To my knowledge, yes.

PN3016

Your statement was made in February, 9 February, Mr Howells, have there been any - is there any other numbers, have the numbers changed?---I'm not aware of but I have not inquired since that day.

PN3017

Paragraph 72 of your first statement, Mr Howells, you mention a meeting on 21 July 2000. I might show you a document. Can I ask you whether this document is from - I just want you to identify that for me. You see that document indicates that it is the meetings of a SBU meeting on 21 July but it does not say what year?---Yes.

PN3018

Are they the minutes of the meeting you referred to on paragraph 72?---Can I just take a moment to read that.

PN3019

I would say, yes, they are probably minutes of that meeting.

[11.45am]

PN3020

Okay, so that is 21 July 2000?---Yes.

PN3021

Your Honour, that is in the folder of subpoenaed documents. I don't think I need to take it - you to it at this stage. I just want to have it identified.

PN3022

SENIOR DEPUTY PRESIDENT POLITES: Yes.

PN3023

MR SLEVIN: You provided in your statement attachment 11, it is a table that deals - we might at this stage, Mr Howells, I might see if we can organise some documents for you. You have got your statement with you with the attachments, can you check whether your copy of the statement has attachment 1 which is EB3?---I have got a copy of EB3, yes.

PN3024

EB2000 which is attachment 4 to your statement?---Yes, I have that as well.

PN3025

And the July 2000 document which is attachment 10?---Yes, I have got that document as well, sir.

PN3026

Do you have a copy of exhibit G3 which is the company's proposed 170 MX award, Mr Howells?---I don't believe I have, no.

PN3027

We will start with exhibit G3, that last document you were handed. Can you go to paragraph 11 for me?---Yes.

PN3028

And that paragraph deals with superannuation and it provides simply that:

PN3029

Yallourn Energy shall continue to be an employer participating in the Equip Super Fund and be subject to the rules of the fund as they apply to Yallourn Energy.

PN3030

Now, the existing superannuation provision, Mr Howells, is contained in EB3 and it is also clause 11 of that document. You see in EB3 that the superannuation clause includes six sub clauses. It is identical to you - to the MX award proposal in the first sub clause and then there are a number of other matters contained there. I just want to put to you first of all that throughout the negotiations for a replacement agreement there was never any claim by the company to alter the existing superannuation provisions. Simply wasn't discussed - - -

PN3031

SENIOR DEPUTY PRESIDENT KAUFMAN: Mr Slevin, could you tell me whether the VEI superannuation fund is the same thing as the Equip super fund? Is that just a new name or - - -

PN3032

MR SLEVIN: My apologies, your Honour. I should have drawn your attention to that. Yes, there has been a name change since EB3. We can't tell you when. Mr Georgiou says last year.

PN3033

SENIOR DEPUTY PRESIDENT KAUFMAN: Yes, thank you.

PN3034

SENIOR DEPUTY PRESIDENT POLITES: Mr Georgiou is the fount of all knowledge.

PN3035

MR GEORGIOU: I wish.

PN3036

MR SLEVIN: I am learning that. Humorous anecdotes as well.

PN3037

Do you understand the question I have just put. That throughout the negotiations it was never discussed by the company that you would be seeking to remove 11.2, 11.3, 11.4, 11.5 or 11.6?---There were discussions about superannuation but they tended to take place with Mr Chapple who was the IR adviser and Mr Jankovic from the ASU. So, I was a party to them discussions but to my knowledge I don't believe there was any discussions appertaining to that but I can't be certain on that.

PN3038

And, indeed, in attachment 11, you indicate what documents during the negotiations actually referred - made reference to the topic of superannuation, and without taking them to you, Mr Howells, none of those documents indicate that - in particular the company documents, indicate the company intended to remove those sub clauses?---I don't know, I will have to take your word for that.

PN3039

Well, did you prepared attachment 11 to your statement?---I was involved in it, yes, but in terms of the superannuation aspects I am not familiar with that. I was guided by others on that particular issue.

PN3040

But the exercise of putting attachment 11 together and actually identifying the documents during the bargaining period that dealt with the issue of superannuation - do you have attachment 11?---I have, yes.

PN3041

Did you actually engage in the physical task of sitting down and saying, well, superannuation, I go to EB 2000, I will find it at paragraphs 259 to 260?---I went through it and it was pointed out to me in some areas where things occurred, but I mean in terms of attachment 11, there is a tremendous amount of detail in there to be able to recall it all. I am afraid I can't.

PN3042

I am not asking you to recall it, it is just the process. Did you sit down and do it yourself - - -?---I went through that with others, yes.

PN3043

With others. And who were the others who went through it with you?---Basically, the others that were involved in the negotiations.

PN3044

So, the other managers on site?---Yes.

PN3045

Okay. Now, and indeed in relation to what was discussed during the bargaining period, the discussions that occurred revolved around the union's claims and the union had two claims. They wanted there to be a capacity for new employees to join division C of the superannuation fund because there was a prohibition on that occurring and that was one of the unions' claims. Do you recall that claim being made?---I believe that is true, yes.

PN3046

And there was a claim from the unions that there be an increase in the accrual multiple for employees and that would apply to divisions B and C?---Again, that may well be true, but I have to be honest, I have no knowledge of the superannuation system and its significance in terms of what these points mean. So, I wasn't actually party to those discussions.

PN3047

Well, do you recall, rather than getting too much into the detail, that essentially the unions were making a claim to increase the super benefit?---I know they made a claim with respect to superannuation, but the significance of it was lost on me. I was not involved in that.

PN3048

And indeed during the negotiations and as is reflected by one of the documents that you refer us to in attachment 11, the July 2000 document, the company indicated that they would accept the first claim in allowing your employees to move into that - - -?---I believe that is correct.

PN3049

And that was the extent of the discussions about superannuation?---No, there was one other issue with respect to that, because I know that Mr Chapple did speak to Equip Super who indicated it may not be in the employees' best interests to actually do the transfers that the unions were seeking, and it would be better of the employees individually spoke to Equip Super about that.

PN3050

In relation to recreation leave, Mr Howells, see in G3?---Yes.

PN3051

At 15.2, the recreation leave entitlement for a day worker is 150 hours per annum calculated at four weeks at 37_ hours, and for shift worker is 187_ hours per annum calculated at five weeks at 37_ hours. In EB3, are you aware that the leave requirements are 167 hours for a day worker and 224 hours for a shift worker?---I am, yes.

PN3052

And in the documents you refer us to in attachment 11, the company offer in EB2000 was to continue that level of rec leave at 167 hours and 224 hours?---There were other discussions that took place about rec leave with respect to the working week and how that impacted.

PN3053

But so far as the quantum of leave was concerned, and I am referring you specifically to EB 2000, 167 and 224 hours were maintained?---I would not argue with that, no.

PN3054

And in the July 2000 document, perhaps this reflects your earlier answer, the 167 hours and the 224 hours were maintained for the 37_ hour week, but 160 hours and 215 hours were suggested for the 36-hour week, on the implementation of the 36-hour week?---Yes, there were discussions about the impact of changing the working week and the application of that.

PN3055

And so it is the case, isn't it, Mr Howells, that the company did not at any stage during the bargaining period make a claim for the reduction in the quantum of recreation leave?---Well, it did in the July 21 document, you have just said, in respect to the working week itself, because the hours you have quoted are pertaining to a 40-hour working week and not a 37_-hour working week.

PN3056

So for the 36-hour week, that was a claim that related to the 36-hour week, but so far as the calculation in respect of the 37_-hour week there was never a claim to reduce the quantum of leave?---Not to my knowledge in that context, no.

PN3057

And certainly even if we take into account the 36-hour week proposal, there was no claim to reduce the leave to 150 hours and 187_ hours which is contained in the company's proposed MX award?---Again, not to my knowledge.

PN3058

And are you also aware that what is proposed in the MX award is below the rec leave entitlement in the safety net awards?---Yes, I am aware of that.

PN3059

Yes, and indeed the safety net awards have 154 hours for day workers and 200 hours for shift workers?---Yes.

PN3060

And were you involved in putting the 170MX award together?---I had some involvement, yes.

PN3061

And who did put that together? Am I right in saying that it was the strategy, the human resources strategy working group?---No, it was just the managers who were involved in the negotiations that had a large input into putting that together.

PN3062

Could I ask you where this 150 hours and 187_ hours came from, Mr Howells?---Well, it was just on the basis that a day worker gets four weeks' holiday and a shift worker gets five weeks' holiday, and based on the 37_-hour week, it was a straight multiplication of that.

[12.01pm]

PN3063

There is another matter I would like to take you to, attachment 11 in your statement, the cancelling of recreation leave at the company's discretion which is in G3, the proposed award, 15.3. Do you see that? There is a provision:

PN3064

Yallourn Energy may cancel recreation leave after it has been approved, where necessary, to meet the needs of the business, in which event Yallourn Energy will recompense the employee for any substantiated financial loss suffered as a direct result of the leave cancellation.

PN3065

There is no equivalent provision in EB3, is there, Mr Howells?---I don't believe so, no.

PN3066

That is a new provision. And you suggest in attachment 11 that that clause was dealt with during the bargaining in paragraph 14 of EB2000. Do you have attachment 4 to your statement available to you there, Mr Howells. The paragraph number again is paragraph 314. There is nothing there about the company having a discretion to cancel leave after it has been granted, Mr Howells, is there?---No, there wouldn't appear to be.

PN3067

And in attachment 10, the July 2000 document, at clause 11.2 similarly there is nothing there that gives the company the right to cancel rec leave after it has been approved?---No, there wouldn't appear to be there.

PN3068

So there was no - I want to put to you there was no claim made during the bargaining period by the company that the company have a discretion to cancel recreation leave after approval has been given. That is the case, isn't it?---No, that is not correct. There were a hearing in front of Commissioner Lewin with respect to that. I can't remember the date but there was a hearing with respect to whether we could cancel rec leave in those circumstances.

PN3069

And do you say it was part of - can you explain to us what that matter before Commissioner Lewin was, Mr Howells?---Well that was as a result of - during the mine maintenance dispute we needed people to actually work and we sought to cancel rec leave of one individual and that was subject to a hearing before Commissioner Lewin.

PN3070

And the hearing was to clarify whether you had the right to do that?---That is correct, yes.

PN3071

And you discovered through those proceedings that you didn't have that right?---That is correct, yes.

PN3072

But that was not part of the negotiations towards a replacement agreement, Mr Howells, was it?---It was a point at issue at that time and it was sought to discuss it at that time.

PN3073

You don't suggest that it was then taken up as a claim in the negotiations; for example, in the common conditions discussions that occurred in March of last year?---I don't know whether it was involved in those discussions because I wasn't party to those discussions.

PN3074

In relation to accident pay, Mr Howells, we might tread that path again: if you could start with G3 and have a look at 15.10. No, you see that is what is sought. Are you aware of the provision in EB3 in relation to accident pay?---No, I am not.

PN3075

Well, can I take you to clause 10.5. Can you see that those two clauses are different, and perhaps if I can simply summarise them and say the effect of what is - well, the first - one effect of what you propose in your MX award is that the length of time before the accident make-up pay is reduced from 104 weeks to 52 weeks; can you see that? I will refer you to 10.5.3, I think is to that effect, Mr Howells?---That is how it would appear to read.

PN3076

And you also delete in your MX the definition of normal weekly pay, and that the effect of the normal weekly pay definition in EB3 is to include certain allowances and benefits that may not otherwise be included in make-up pay; do you accept that?---Well, I accept that, yes.

PN3077

So I am putting to you that there are two reductions that you seek in your 170MX from the existing condition. The first is the length of time the make-up pay will be and the second is the means of calculating the make-up pay?---Yes.

PN3078

Do you accept that is the effect of that?---That would appear to be the effect, yes.

PN3079

That is the effect. Yes, okay. Now, during the negotiations in attachment 11 you refer us to EB2000 paragraphs 265 to 267. Do you see in that document that the company's document simply sets out the EB3 provision again; it is identical to EB3?---It would appear to be, yes.

PN3080

And that if you have a look at attachment 10, the July 2000 document, clause 10.1 is again identical to the EB3 provision?---Again that would appear to be the case, yes.

PN3081

So there was never a claim during the bargaining period, Mr Howells, to reduce the accident pay benefits currently enjoyed by the employees?---I personally wasn't aware of that. I accept that.

PN3082

I want to take you to clause 18 now of G3, Mr Howells. Do you see at 18.1 under: Other employment, you say:

PN3083

There will be no restrictions on the employment of any casual, part time or temporary including fixed term employees.

PN3084

What do you understand by a temporary employee, Mr Howells?---Basically just a short term duration.

PN3085

There is no definitions provided in your award. When you say short term, what are you talking about?---Maybe a few weeks. I don't know. It depends on the circumstances.

PN3086

Now, currently if someone is to be employed for a few weeks, they are employed as a casual employee, aren't they?---That is correct, yes.

PN3087

And they are paid certain benefits in relation to - or under the agreement?---This would be under circumstances where they were employed directly, yes.

PN3088

And they are entitled to loadings, 25 per cent loading, and certain other benefits?---Yes.

PN3089

But in EB3 and currently there is nothing to cover something that is called a temporary employee, is there?---I am not aware of it, no.

PN3090

And in the documents that you refer us to in your attachment 11, you refer us to paragraph 62 to 77 of EB2000. Perhaps you can go to that, Mr Howells. Do you see those paragraphs only refer to casual employment and permanent part time employment. There is no mention of something called a temporary employee?---Yes, I accept that.

PN3091

And EB - or rather July 2000 you refer us to clauses 6.1.6 and 7.1.1, and there again - well, perhaps I will let you go to those, Mr Howells?---Can you give me the numbers again, please?

PN3092

6.1.6?---Yes, and - - -

PN3093

No, I have given you the wrong number. No, I have gone to the wrong provision. In your attachment 11 you don't identify any clause in your July document that relates to these other employment categories. So it is the case then - could I assume from attachment 11 that you are saying to us that in the July 2000 document there were no proposals in relation to other employment - - -?---That would appear to be the case but - - -

PN3094

- - - and consequently there wasn't a claim?--- - - - without looking through the document, I don't know.

PN3095

And consequently there was no claim being made in that document for this new category of temporary employee?---Again, that would appear to be the case but that is without looking through the document.

[12.15pm]

PN3096

So this new category, do you say there were ever any discussion about having a new classification or a new category of employment called "temporary employee"?---I don't know, I'm not aware of any.

PN3097

Then if you go back to G3, clause 21.5. And you see that provision is a provision that picks up termination of employment on the ground of redundancy and states:

PN3098

The employee shall, in addition to the notice for pay in lieu prescribed in that clause, be entitled to the following amount of severance pay.

PN3099

And then a table is set out for severance pay. First of all, in relation to the current situation EB3 has the, and we have seen this clause, has a prohibition on forced retrenchments?---That's correct.

PN3100

And there is a voluntary departure package, voluntary separation - voluntary departure package mentioned in EB3 and you tell us that there is currently a voluntary separation package in place. First of all, the benefits being offered under the voluntary separation package are well in excess of those benefits described in the MX Award on that page aren't they, Mr Howells, you know that?---That's correct.

PN3101

Do you recall off the top of your head what benefits are being offered under the VSP?---I can't recall just off the top of my head, no. But they are certainly over and above what's in the award.

PN3102

Do you recall seeing the voluntary separation - well, I will just put to you, the voluntary separation package is in the evidence, Mr Felsbourg's statement. Hopefully, I won't have to take you to it, Mr Howells, but it's a package that was sent to employees on 12 August 1999. It is a document entitled Blueprint for The New Millennium. Do you remember it was - - -?---I am aware of the document, yes.

PN3103

You are aware of the document. That is the document that sets out the VSP - the current offer in relation to retrenchment pay. Now, if we go to EB2000 it seems that so far as 21.5 is concerned, that document is silent on the question of severance pay. Perhaps if I take you to the document. Do you still have that document?---I'm sure I've got it somewhere.

PN3104

You refer in attachment 11, you refer us to paragraph 4 and paragraph 156. See, there is no mention there of redundancy at all in paragraph 4, first of all, Mr Howells, is there?---No, there's not.

PN3105

And paragraph 156:

PN3106

The use of teams, family rosters and principles of teamwork will be the key mechanisms for involving all employees of Yallourn Energy in driving the performance of the business. The long-term security of employment is dependent on increasing productivity and reducing costs.

PN3107

No mention there of retrenchments or redundancies, Mr Howells?---Not in that - not in that paragraph there, no.

PN3108

And the other company document that is referred to is the July document again and it is 6.1.6 and 6.1.7 of the July document?---6.1.6 and?

PN3109

6.1.7. And in particular I want to ask you about 6.1.7. The word "redundancy" appears there in reference to standard TCR provisions. Do you know what standard TCR provisions are?---No, not off the top of my head.

PN3110

Do you say that 6.1.7 is somehow a claim in relation to what redundancy pay will be paid to employees?---I don't believe there is any mention of redundancy pay in the document.

PN3111

And I asked you about G3. The document on 21 July 2000, were you also involved in putting that document together?---Yes, I had some involvement.

PN3112

And are you aware that in putting that document together there was any intention of the company to be making an offer that set out what payments would be made in the event of forced retrenchments?---No, the company didn't make any offer with respect to any forced retrenchment.

PN3113

And, Mr Howells, is that the case as well during the negotiations - well, that is the case in relation to negotiations as well. Not only is it not in any documents, there was never any discussion about the level of payment to be made in relation to forced retrenchments?---On the basis that the union has refused to accept anything other than a security of employment clause it would be very difficult to engage them on that subject.

PN3114

In relation to stand-downs. If we go to G3 again and proposed clause 23. Give you a chance to read that clause, Mr Howells?---Okay. Okay.

PN3115

You see that stand-downs are proposed in relation to two sets of circumstances. The first is:

PN3116

Any strike or other industrial action including protected industrial action as defined by the Workplace Relations Act.

PN3117

And the second is:

PN3118

Any breakdown in machinery or equipment or any stoppage of work by any cause for which the employer cannot reasonably be held responsible.

PN3119

In relation to this provision you have referred us to paragraphs 46 to 48 in the EB2000 document. And you see that those paragraphs, first of all, are contained within the disputes procedure proposed in that document. You see that a right is given to an employer to withhold remuneration under paragraph 47 but that is only in relation to certain industrial action. Perhaps the easiest way is - I will try to paraphrase it first, that this is essentially the provision that is in the existing disputes procedure, that where there is a dispute on foot it is being dealt with under the disputes procedure, there will be no industrial action. And where there is industrial action the employer will have the right to withhold any remuneration in relation to that industrial action. Do you understand that that is how these provisions operate, Mr Howells?---I believe so, yes.

PN3120

To be fair to you, make it clear first of all that this provision - well, first of all this provision simply repeats what is in EB3 to start with, doesn't it?---I will take your word for that.

PN3121

That what the company was offering in this document was something less than the first dot point in the stand-down provision in your MX Award. In other words, your MX Award says "any strike, any protected action, any industrial action", and what this document is suggesting is that right will only occur where the action is in relation to a dispute being dealt with by the disputes procedure. Do you understand the distinction that I make?---I'm not sure I do, no.

PN3122

No. But the provision that you offered only applies to certain industrial action and that is the industrial action described in the procedure. The industrial action in your proposed MX Award applies, or is described as industrial action in a far more general sense?---Can I take some time to read that and just familiarise myself with it, please? Could you repeat the question again then, please?

PN3123

That the industrial action contemplated in your offer in July - sorry, September 1999, is far more restrictive than the industrial action claimed in your MX Award?---Could you elaborate on that because - - -

PN3124

SENIOR DEPUTY PRESIDENT POLITES: Mr Slevin, before the witness answers that question if he can. Is this not a matter going to the interpretation of the clauses on which the witness' view is not really going to help us? I appreciate why you are asking these questions. I presume they are directed to the question of whether the matter was at issue in the bargaining period. It seems to me that interpreting the actual documents - we are not going to be assisted by the witness' view of that.

[12.30pm]

PN3125

MR SLEVIN: Yes, I understand, your Honour. The questions may not be - perhaps if I start at the end may be the way.

PN3126

MR GREEN: Can I just say in that context. We have had a concern about a number of these questions for the same reason your Honour and presiding members have just mentioned. But it raises another question too. Namely what do those words "matters at issue" mean. So we think it is partly bound up with interpreting the documents that are said to throw light on what the matters at issue. And it is also a question of what construction you put on those words "matters at issue".

PN3127

SENIOR DEPUTY PRESIDENT POLITES: Well, it certainly is, but to the extent that if what is being sought to be elucidated from the witness is what were the discussions about in those documents that had made the evidence which is relevant, and it is a bit hard without hearing it.

PN3128

MR GREEN: And that is why we have not objected, because we do - it is said that it may bear upon that question, your Honour.

PN3129

SENIOR DEPUTY PRESIDENT POLITES: But it is a difficult area and, Mr Slevin, I would ask you to bear in mind that we can construe the documents, and we are not really helped by what the witness thinks about them.

PN3130

MR SLEVIN: Yes, I appreciate that, your Honour.

PN3131

Mr Howells, during the bargaining period, did the company ever make a claim that they wanted a greater capacity to stand down employees in relation to industrial action than they currently have?---In terms of the documentation put across, I mean, I wasn't a party to EB 2000. I mean, it states it there and it was also in other documents, I believe. It was discussed.

PN3132

But you are aware that in the evidence that there is a disagreement between yourself and Mr Felsbourg about what was at issue during the bargaining period?---I am aware of that, yes.

PN3133

And Mr Felsbourg simply says, well, the company never told us that they wanted a stand-down provision?---Well, there were a lot of issues that were passed across, like EB2000, they were never discussed in detail. And parties didn't want to get involved in discussion in detail because they had very different views on that. It was very hard to say whether it was or it wasn't at issue in that context.

PN3134

And your response to Mr Felsbourg in your evidence has been to say, well, have a look at these documents and you will see what I mean, these things were part of the negotiations?---Well, Yallourn put EB2000 to the unions and it rejected EB2000, but it didn't say on what basis it rejected it. I mean, there was some correspondence in respect to that, but it didn't go into any great detail about particular issues.

PN3135

So can I now return to my question, which is the industrial - did the company ever make a claim on the union to say we want to be able to stand employees down in more extensive circumstances than we currently have the right to do?---It did through the documentation it passed to the union such as this document. But I will concede, it wasn't discussed because the parties would not agree that they would accept this document.

PN3136

And it is only what is in the documents that set out the claim. It is not as if you - for example, I am saying to you that in September of '99 you put a document to the employees and it is just the same as your current right, exactly the same as EB3. I am saying to you, give me the opportunity to tell the Commission if the company had actually formed the view that they wanted more than that?---Sorry, I don't quite follow what you said.

PN3137

SENIOR DEPUTY PRESIDENT POLITES: Just take it in stages, Mr Slevin.

PN3138

MR SLEVIN: The company put - the document the company put in September of 1999 was basically just the same as the current disputes procedure?---In September 1999?

PN3139

I am sorry, Mr Howells. Was there a claim - are you aware of any claim during the bargaining period where the company said to the unions, we want a more extensive stand down clause - the capacity to stand down employees than we currently have?---I never made any claim other than what was in the documentation.

PN3140

And I have spoken to you about the industrial action, and I want to speak to you about the break down in machinery or equipment, or any stoppage of work by any cause for which the employee cannot reasonable be held responsible. There was no claim during the bargaining period by the company in regard to those matters, was there?---I am not aware of it being discussed.

PN3141

Thank you, Mr Howells. I am finished with those documents so if they are crowding you in the witness box. I will return to your first statement. Before we do, you said in answer to a question before words to the effect that, and correct me if I am wrong, that during the negotiations some of these documents were tabled and some of the matters in them simply were not discussed?---Well, the documents were rejected. So in some instances you could say none of it is discussed. You could also make the same sort of assessment of the log of claims, that some of the issues there weren't discussed, but the document nonetheless was tabled.

PN3142

And in relation to specific documents, the EB2000 document though was discussed, that is the case, isn't it?---I wasn't at Yallourn when EB2000 was tabled.

PN3143

When did you start getting involved?---I was involved from July onwards.

PN3144

Okay, but from July onwards there was, for example, the Marysville lock-up?---There was, yes, that is correct.

PN3145

And those discussions were based on EB2000, the company's first offer?---No, the unions wouldn't negotiate round EB2000. The document that was used was EB3. We sought to insert clauses from EB2000, yes.

PN3146

So in that process - I think the process is described for us in the evidence, but in that process there was the lock-up, the parties sat down and said, well, here is EB3, here are out claims - the company said, here are our claims in EB2000. The union said, here is our log of claims. An attempt was made to see whether the parties could come to an agreement on the common terms and conditions?---Yes, there was an establishment of positions with respect to that.

PN3147

And is it the case then, are you saying, that during that process that is when the documents were discussed so far as they were relevant to the negotiations?---Some issues were discussed, but I mean we didn't go right through EB2000 because we were there for three days and we had got two huge documents to work from.

PN3148

So that deals with EB2000. As far as the July document is concerned though, and I think you make that clear, there was never any discussion at all about the terms in that agreement?---The terms of the July - the document in its entirety. Well, when we put the document on the table in July 2000, as you are probably aware we sought to utilise that as a starting point for negotiations on the basis we asked the unions to embrace our seven principles, and also to pull away from their industrial action, and they declined.

PN3149

And they declined to meet your two provisos for negotiations but they were willing to have negotiations, that is the case, isn't it?---They weren't - yes, they were prepared to sit down and talk, but they weren't prepared to embrace the seven fundamental principles.

PN3150

And, indeed, at that meeting on 21 July Mr Felsbourg said, well, we are ready to have negotiations about the document and we are available for the entire weekend to do so. Do you recall him saying that?---He may have said that. I can't recall exactly, but he may have said that.

PN3151

And the relevance of that is that the industrial action was not going to commence until the Monday?---That is correct, yes.

PN3152

Paragraph 95 of your first statement. You talk about the company seeking to introduce significant change, and that you will require time to do so. This is in support of a three year duration for your MX award. Within that three year timeframe what change do you say, what significant change do you say is in prospect?---Well, there is undoubtedly going to be change within the mine in terms of moving into a new mine. There is undoubtedly going to be some change in the power station with the EI and C project and the upgrade surrounding the power station itself.

PN3153

If we go to the mine, you are not moving into the new mine in the next three years though, are you, Mr Howells?---No, there are a number of mine plan proposals that are on the table that I have to confess, I am not up with the detail of those, as I don't deal particularly in the mine.

PN3154

So what I put to you, the only change that will occur during the three year life is the introduction of new technology in the mine, the Stamil loaders and the dozers?---Well, that may certainly occur within there, but as I say there are number of options available but I am not up with the detail, but those options may have significant impact in the mine.

PN3155

And the control panel upgrade, are you aware of the time - I think we were given a timetable while we were on the inspection a couple of weeks ago - are you aware of what that timetable is?---Well, there is no fixed timetable associated with that. There are, again, a number of options available to us. We can either do it in a very short timeframe or we can do it over the period of five or six years locked into the planned major overhauls that will occur within the power station at that time.

PN3156

All right. You were there during the inspection when Mr Omar addressed the Commission and the parties?---That is right, I was, yes.

PN3157

Mr Omar's expectation was that with the changes in relation to the first unit of the four units, wouldn't be completed until towards the end of next year?---No. It would be towards the end of this year if we chose to go with the first option that is available to us. We could complete that change this year.

PN3158

I am talking about the presentation Mr Omar gave us though. Mr Omar did say that his expectation was the end of next year?---No, I believe he said September 2001.

PN3159

Are there other options that might be the end - you talked about option 1. How many options are there?---Well, there is probably three options that you could go with. You could go with option 1 which is running over a six year period fitting in with the normal overhauls. You could go with a speedier process to do it over three years if you wanted to introduce that and pick up bits as you were going through boiler cleans and natural outages. Or you could actually go for a third option which would basically be to make that the critical path and do the whole thing in a very very short period of time.

PN3160

And is there a preferred option at the moment?---Well, the preferred option would really be dictated by the board. We would have to prepare papers to actually say which we thought was the right option and make recommendations. We haven't at this stage done that.

PN3161

What is the - well, the people working on the project must be working under some assumption as to what timeframe would be finally used?---No, because there is no - - -

PN3162

MR GREEN: Well, I object to that. If they are working on that assumption, I think it is a matter for those people, not for this witness.

PN3163

SENIOR DEPUTY PRESIDENT POLITES: Yes, I don't know what assumption - what this witness can give about their assumptions, Mr Slevin.

PN3164

MR SLEVIN: Have you given those working on the project an indication of which of the options you believe will be taken?---No.

PN3165

Which of these three options will be taken up?---No, I haven't.

PN3166

And do you have no view on that?---I believe you would have to cost it. We would also have to look at the market conditions, and my preference would be to be able to move from one to the other if the need arose, because it would virtually depend on how the market was performing at any given moment in time.

PN3167

And just to be fair to you, were you in the hearing room when I gave the report to the Commission about the inspection?---No.

PN3168

I just want to be fair to you, that I gave a report following the inspection and following the inspection I said that Mr Omar told us that they were aiming for Board approval in June of this year. This is in relation to the upgrade, and that the earliest unit upgrade would be December of 2002 with following upgrades of the other units taking another two to four years?---Well, that is not the case. The first upgrade would be likely to take place as W2 unit at September 2001, if we go with the original plan.

PN3169

And that is the six year option?---That is the six year option, yes.

PN3170

And is it still June approval from the Board that has been - - -?---Not necessarily. It has been a moving target, to be quite honest. It keeps moving further and further out.

PN3171

You have got these three options and you seem to be suggesting that they have not been taken up - the decision has not been made. In relation to the consultation with the employees about how this will all occur, what sort of timeframes do you think are necessary for that sort of consultation?---Which employees are you - - -

PN3172

The employees in the power station who will be affected by this?---The operations department employees. In terms of consultation about the change?

PN3173

Yes?---I don't really know what the timeframe will be. It will depend on how many issues that actually could come from those collect consultation process. But there has been some discussions with respect to that. I am aware of Mr Wandmaker having talked to the operations LCG about the possible impact as he saw it.

PN3174

And what are the possible impacts?---The possible impact is considerable reduction in numbers in the power station's operations department.

PN3175

Those numbers - there are around 30 employees - a reduction of around 30 employees?---Well I am speaking - I am just making an estimate now. I mean, based on previous operations of this nature that I have been involved with I would say probably you could run the station in those circumstances and there may be 30 to 40 employees but that is without being over the detail.

PN3176

And what does that amount to? A reduction of how many?---Probably about 50 per cent.

PN3177

SENIOR DEPUTY PRESIDENT POLITES: Mr Slevin, the witness has been in the box for over two and a half hours so I think we will adjourn now. We will resume at 2 o'clock and we will sit until five to 4.

LUNCHEON ADJOURNMENT [12.50pm]

RESUMED [2.08pm]

PAUL HOWELLS, on former oath:

PN3178

SENIOR DEPUTY PRESIDENT POLITES: Yes, Mr Slevin.

PN3179

MR SLEVIN: Mr Howells, before lunch you will recall you said there were three options in relation to the control panel changes; one was a six year option, one was a three year option and the third was you could do it straight away option. The third option is very unlikely, isn't it?---I would say yes, that is unlikely.

PN3180

And in relation to the - and we are still around paragraph 96 of your first statement, in relation to the various investments that the company has proposed, you are not saying that the company won't invest in these matters, are you, if they don't get the 170MX award that is proposed - you don't put it as strongly as that, do you?---That is not a decision that I would make. That is a decision the board would actually make.

PN3181

And do you understand that - do you understand that the board's position is that while they need an enabling document, they have never really considered the detail of what industrial instrument is to be put in place?---No, their only position is they would want an enabling document in place.

PN3182

In paragraphs 98 and 99, you say also in support of a three year term for an MX award that you currently do not have a stable workplace environment. What do you mean by that?---We mean a workplace environment where you can effect the change that we require to give confidence to make that investment.

PN3183

And what - there is nothing really in your evidence by way of example of what you mean by an unstable workplace environment?---I would suggest we would need an enabling document that encompasses the seven fundamentals and that would give us the stable environment and give the board the confidence with respect to this particular project.

PN3184

And you refer in paragraphs 98 and 99 in particular to cultural change and a modern workplace culture. What do you mean by modern workplace culture?---A culture again, basically, where the seven fundamentals are right at the heart of the actual culture which allows individuals to develop to their full potential for the best needs of the business and also to meet their aspirations.

PN3185

The mechanics of achieving that though, Mr Howells - is the company's position that the mechanics of that that are relevant to an award are to be able to have team based rosters?---Basically it is a team based culture. It is to have the rosters in place to give the flexibility that is required.

PN3186

So the family rosters are important to this modern workplace culture?---If you are talking particularly in power station operations, yes, and in mine operations.

PN3187

Yes. Are there any other specific things that are referable to the actual terms of an award or an agreement like rosters that encourage this modern workplace culture?---I would say all of the seven fundamentals would encourage that workplace culture.

PN3188

I am asking you about specific award type clauses, not the general fundamental principles?---Well I would say the award was drawn up from the seven fundamentals.

PN3189

Paragraph - - -

PN3190

SENIOR DEPUTY PRESIDENT POLITES: Just before you go on, Mr Howells, did you say you were part of the group that drew up the award?---I was involved in some aspects of it but not all.

PN3191

Were you involved in drawing up the provision on severance payments?---Not specifically, no.

PN3192

Because to be quite frank, this is a particular type of arbitration. That provision is the very minimum provision contained in the safety net awards of the Commission. Did you ever consider the possibility that realistically, measured against the voluntary severance packages that you have offered, the Commission was ever likely to accept that as a provision?---The position of the business was we always felt that the voluntary package should be better than the compulsory package. There was odds with that because clearly we have had discussions with other unions who think it should be the other way around.

PN3193

Why would you say that the voluntary package should be better than the compulsory package?---Because that is our experiences elsewhere, particularly in the UK.

PN3194

Yes. Thank, you, Mr Slevin.

PN3195

MR SLEVIN: In paragraph 102, you say that the rates that you provide in the award at 2.5 per cent increases after 12 months and 24 months respectively take into account increases in the CPI. Did you actually do research to see what forecasts have been done about what the CPI will be over those periods?---I personally did not, no.

PN3196

Did anyone on the team who put the award together - - -?---Well, that part would be drive by HR and I am assuming they would have done that, yes.

PN3197

But no-one has ever shown you any documents that show you the forecasts that underpin that statement that you make in your - - -?---I didn't inquire about that, no.

PN3198

And so your proposal is that there be no increase at the time the award is made?---That is correct.

PN3199

And do you make that proposal on the basis that you understand that the CPI at the moment is zero?---We made that on the basis that we felt the workplace was already well paid, well above the national average in terms of payment.

PN3200

So you made an assumption that the workforce should take a cut in real wages?---No, we made the assumption, as I said, based on the fact that they are already well above the national average.

PN3201

Do you agree with me that the effect of what you have decided is that the workforce will take a cut in real wages?---Well there are also other things in there such as over-award payments which may compensate for that fact based on the productivity that may come from the award.

PN3202

I am assuming that your answer to my question was yes, you do understand that that amounts to a cut in real wages if you - - -?---In the perspective you put on it, yes.

PN3203

Now you now made the statement, and it is in your statement again:

PN3204

Yallourn employees are already very well paid.

PN3205

Again, compared to who?---I think the comparison was done through HR against the national average and it was also done against the awards as it states there in the actual statement itself.

PN3206

Well what national average - we will stay with the national average?---Well they were quoting around about $42,000 is the national average.

PN3207

Is the general average weekly earnings figure?---Yes.

PN3208

And that is your understanding. Was there any comparison done with other workers in the electricity industry?---I don't know.

PN3209

Don't know. And how about comparisons to what wages are paid by your competitors, other brown coal - - -?---Again, I don't know what comparisons were made, if any.

PN3210

SENIOR DEPUTY PRESIDENT POLITES: Do you think that would be relevant, Mr Howells?---As I say, we took it against the national average but it depends if you say relevant, do you take it against all generators in Australia or do you take it locally.

PN3211

Well relevant to this case, to our determining what is an appropriate relator?---I would suspect it could consider the generating of the electricity industry as a whole.

PN3212

MR SLEVIN: What about the generators - - -

PN3213

SENIOR DEPUTY PRESIDENT POLITES: You know the grounds on which the bargaining periods were cancelled?---The fact that there was no possibility of a negotiated settlement.

PN3214

You know that these employees are traditionally covered by paid rights awards?---Yes, we are aware of that as well.

PN3215

So why would you put up the minimum rates payable in a national average if you are talking about realistic document that you expect the Commission to adopt?---As I say, I wouldn't involved directly in actually putting that together.

PN3216

MR SLEVIN: Now in relation to the over award payments, Mr Howells, is there anything you can show the Commission that will provide any form of guidance as to how these over award payments will be made to the employees?---In terms of the personal development plan, we can put things in there to allow people to progress by actually progressing against that plan through an appraisal system.

PN3217

So far as the - but you want to move away from the current PDPs, don't you?---I am talking about a personal development plan that would include an appraisal system.

PN3218

And it is something that hasn't been developed yet, this new PDP system?---I haven't been involved in any development on that front, no.

PN3219

Are you aware that there is any document - - -?---I am not aware of any document. There have been discussions.

PN3220

Mr Howells, have you still got G3 which is the proposed award?---Yes.

PN3221

Can I take you to clause 7.4. Now the award at - I am sorry, Mr Howells. Go back to clause 5. It says:

PN3222

The award shall be read in conjunction with the safety net awards and where there is any consistency with this award and the safety net awards, this award shall prevail to the extent of any inconsistency.

PN3223

Now in preparing the document, was the exercise done where someone actually sat down with the safety net awards and acknowledged what provisions from the safety net awards would be excluded by the MX award?---Yes, somebody sat down with them. As I say, I wasn't involved in that aspect of it.

PN3224

So were you aware that - was it the intention in putting the document together that things like special leave provisions in the safety net awards be replaced by the provisions in the proposed MX award?---Mr Chapple alerted me to the fact that there was some discrepancies but they were only of a minor nature. Other than that, I am not aware of all the detail of those issues.

PN3225

But - so you believe Mr Chapple has gone through the exercise of actually appraising himself of what parts of the safety net award would be removed as a result of the 170MX document?---I believe he was the one who informed me of that, yes.

PN3226

Can I take you to just one example then, Mr Howells, the shift working arrangements, clause 14.2:

PN3227

The terms and conditions under which shift work is performed shall, except as specified in this award, be as prescribed in the safety net awards.

PN3228

And the clause then goes on to describe a very broad discretion for the company. I want to put to you, Mr Howells, that the nature of that clause is that it leaves nothing for the safety net awards to do?---I don't know without looking at it. As I say, I am not aware of the detail of the safety net awards. I will have to take your word for that.

PN3229

I am just wondering if you turned your mind to that sort of question when the award was put together?---No, I took the word of Mr Chapple with respect to that.

PN3230

Do you have your second statement, Mr Howells?---Can you hand me a copy of that.

PN3231

Have a look at paragraph 13 of that statement and you tell us that you are on the power maintenance local consultative group?---That is correct, yes.

PN3232

And you deal there in paragraph 13 with the introduction of dual tradesmen and you say that it wasn't included in the union's letter of claims. In relation to dual tradesmen, that is an issue which was a hotly contested issue on this LCG, wasn't it Mr Howells?---It didn't actually appear on the LCG until probably about seven months into the negotiations.

PN3233

Once it did there were arguments about whether dual tradesmen would be recognised by the company?---There was a position put by Mr Gloucester to that effect, yes.

PN3234

And the position arises because in July '99 the company, along with a number of employees, agreed that they would go off and get their second trade?---I don't know when that was actually done but I believe that was just done as part of their personal development, yes.

PN3235

And it was done because of the introduction of new regulations in relation to electrical work?---No, not to my knowledge.

PN3236

You are not aware of changes to the regulations? You are not aware of the electricity safety installations regulations 1999?---Not in detail, no.

PN3237

Mr Howells, when Mr Gloucester spoke to you about the dual trades in the LCG these were the arguments that was presented?---No, they weren't.

PN3238

No, they were not required?---Sorry?

PN3239

You weren't required to train these people to ensure they would continue to do the work they needed because there were regulatory requirements?---No.

[2.26pm]

PN3240

You say that that was never raised in your LCGs?---Not in that context, no.

PN3241

In any event, you are aware that you had employees who were training up to get their dual trade?---That is correct, yes.

PN3242

And you were aware that the company agreed that those employees undertake that training?---The company did, yes.

PN3243

And that the claim was being made that as those employees were about to finish their apprenticeship in their second trade, that the new EB should recognise those people for having the second trade?---I wasn't aware that they were about to finish with their second trade.

PN3244

You weren't aware? Mr Gloucester didn't point that out to you?---No.

PN3245

And I put it to you that he did, that Mr Gloucester told you that both he and another employee were about to complete their training?---No, Mr Gloucester actually reported Yallourn to the training board to state that they weren't performing the training in accordance with the legislation.

PN3246

And there was - when you say he reported them, is this the meeting that you are talking about in paragraph 17 of your second statement?---That is correct, yes.

PN3247

And there was concern and you met with the training board people, and it was pointed out to Mr Cropley, the nature of the training that was being done, and that it was agreed by Mr Cropley that the training being provided was adequate?---No, it was not.

PN3248

It wasn't agreed?---No, it was agreed that the training being applied was inadequate.

PN3249

At that meeting that was agreed, then Mr Gloucester spoke to Mr Cropley and explained that in the circumstances, he was doing a second trade, he wasn't straight from school as it were, and Mr Cropley agreed that in those circumstances, it was adequate training?---Not to me, he didn't. The message he actually gave to me was that to actually be a tradesman, you needed to spend 100 per cent of your time training within that particular trade. I pointed out to him that because this is a second trade and Mr Gloucester was required to perform as an employee in his first trade, we couldn't possibly comply and give 100 per cent of his time over to training. And I asked Mr Cropley was there any other way we could actually manage that by reduced amount of time. And what he said was, that on a pro rata basis, if you do less training then it will take considerably longer to achieve the apprenticeship.

PN3250

Did you not follow this up from - well the circumstances are that Mr Gloucester is about to complete his apprenticeship, as is Mr Boyd?---I don't believe those circumstances are correct, because when I spoke to Mr Cropley, he said they would have to spend 100 per cent of the time training, and if they were going to be signed off at the end of their apprenticeship, somebody with electrical competence within Yallourn Energy would have to sign off, to say that they were fully trained in all aspects of the business. And I suggested that that would not be possible on the basis of the training they were undertaking.

PN3251

So you are not aware of the circumstances where Mr Gloucester has - well he is currently sitting his exams to actually get his licence in the second trade?---He is sitting his exams, but at the end of the day, somebody in the business of an electrical background still has to sign off that competence. Inquiries to Mr Cropley of the significance of that - the employment of that person would be held liable - and responsible for confirming the training they had undertaken was actually adequate. And I was somewhat concerned that that would not be the case.

PN3252

Mr Howells, Mr Gloucester tells me he has finished his training?---But still I don't believe anybody in the business would have signed off on that particular aspect.

PN3253

You don't think he is going to get his trade for that reason?---Well I certainly couldn't sign onto it on that basis, and I think it is a big ask to ask somebody else to sign onto it as well.

PN3254

Mr Howells, as I understand it, Mr Gloucester has finished his training, he is sitting his exams, and that he was able to complete his apprenticeship or those aspects of his - or get to this stage of his apprenticeship. In other words, almost finish, in a two year period, not the four year period that you are suggesting in paragraph 17?---I am actually suggesting it would be significantly longer than four years, on the basis of the discussions I had with the training board. Because they expressed concerns, that if we weren't giving over 100 per cent of the time training, you would have difficulty in actually getting somebody to sign them off as competent. And he asked me would I be competent in doing that, and my reply to that was no.

PN3255

And do you know if there is somebody else at Yallourn who would be? Is this an issue that you deal with on a day to day basis?---It is not an issue I deal with on a day to day basis, but what Mr Cropley was trying to get across to me, was whoever did sign onto that, was taking on a very hefty liability.

PN3256

And incidentally Mr Howells, are you aware that Silcar only have dual tradesmen?---I have not spoken to Silcar about that issue, no.

PN3257

But are you aware of that though?---Well I have not spoken to them about it, so I am being told they have, but I don't know whether they have or not.

PN3258

And who is telling you?---Well people like Mr Gloucester are telling me that Silcar have that.

PN3259

And are they also telling you that Silcar recognise the dual trades - - -?---Yes, they are

PN3260

- - - and the rates of pay?--- - - - telling me that as well.

PN3261

And so isn't it the case - and assuming that that is the case, what you are proposing is an MX award that for your employees, would not recognise dual trades, so that your employees would not be being paid for the second trade - that is correct isn't it?---During the discussions at the LCG, I made it clear that as a business Yallourn wasn't seeking dual trades, and didn't see a business need to do that.

PN3262

But you do want to use all skills that the employees hold, don't you?---Preferably, yes.

PN3263

Yes. Throughout your evidence you say that - - -?---Yes, that is correct.

PN3264

Yes. And so once Mr Gloucester is signed off to become a second tradesman, your expectation under your MX award is that he will use both his trades at work?---I will have to discuss that with him, but probably yes.

PN3265

And so circumstances are then, that your award won't recognise his second trade?---Only in the terms of a possible over award payment.

PN3266

And he will be working alongside Alliance - provided the company's proposals finally go through - Silcar workers who have dual trades, who will be being paid extra for having the second trade?---I would have to discuss that with Silcar to understand the circumstances.

PN3267

In your second statement there is discussion at paragraph 47, where you suggest that:

PN3268

Outages need not be done on a shift - they are not essential work - here we are dealing with the essential work being done on shift.

PN3269

Isn't it the case that outages are essential work?---In what context - that it requires somebody there the whole time?

PN3270

Well if a unit is down, for maintenance purposes, isn't it in the company's interests to get it back operating as quickly as possible?---Yes, that would be the case.

PN3271

And so the maintenance work being done on it should be done round the clock?---Not necessarily, it depends on the circumstances.

PN3272

Why is that?---Because of the cost of the maintenance.

PN3273

So it is not essential to get the unit back operating as quickly as possible then?---It may be, it may not be, but again it depends on the circumstances of the maintenance. The maintenance may work round the clock but there is not a necessity to have an operations person around the clock.

PN3274

But you said to me earlier this morning, that you still have operators - operators are still required when maintenance is occurring on outages?---Not necessarily, not all the time.

PN3275

In emergency procedures, for example?---Such as what?

PN3276

Done in the control room?---I am afraid you will have to be a bit more specific in terms of an emergency procedures.

PN3277

Mr Howells, the practice is that when there is an outage, the operators are required in the control room for monitoring various things within the unit. That is the current practice, isn't it?---In accordance with the fixed and minimum manning, yes.

PN3278

Not just in accordance with the fixed and minimum manning - you are not suggesting that they sit around and do nothing when there is not - - -?---Well there is nothing running, so what would they be doing?

PN3279

But there are still gas levels to be monitored, that is the case, Mr Howells, isn't it?---Which gas levels?

PN3280

I will help you Mr Howells. Your unit controllers, during an outage, have a number of responsibilities and this is a list, perhaps we will do them one at a time. They:

PN3281

Manage and coordinate plant access permits and test permits and operator stand by work according to regulations and Yallourn Energy permit procedures and work requirements including unit outages. This also involves the complete investigation of plant details to allow safe access to plant by station access procedures.

PN3282

That is done by people in the control room?---But you don't need people 24 hours a day to perform that on a unit that is out of service.

PN3283

I will just take you to the second:

PN3284

Investigate, manage and report on permit anomalies, plant abnormality, health and safety, plant performance, and operational issues.

PN3285

?---But there is no plant performance to monitor and no operational issues to monitor if there is no plant running. It is my experience of having done this - fulfilled this role on many occasions in the past, that it can easily be fulfilled on days. And there are some tasks, I agree, that remain there, but they are not tasks that necessitate an individual being there 24 hours a day. It can be picked up by others.

PN3286

Mr Howells, you are not suggesting that the - you are simply saying that you need fewer people in the control room?---I am saying in terms of managing outages. You don't need someone there 24 hours a day, because there - the jobs that you referred to, they would only be minor work that can be picked up by others on running units. There is nothing to stop that happening, and that is my experience.

PN3287

I will continue with this list then, Mr Howells:

PN3288

Respond to emergency calls and initiate emergency procedure if and when required.

PN3289

Surely that is something that is required 24 hours a day in a power station?---But there are other people there. You seem to be suggesting you have to have somebody there 24 hours a day in case there is an emergency.

PN3290

But doesn't - we were shown the control room and one particular post was responsible for the emergency phone, and that is where the emergencies were run from?---Yes.

PN3291

So are you suggesting that there could be a maintenance worker somewhere who could make their way up to the control room in an emergency, and make the required calls and the like in that fashion?---I am suggesting that there is someone in the control room that can pick up the emergency phone. You don't need an individual 24 hours a day to answer an emergency phone in case it rings. That seems to be what you are suggesting. This is not my experience. I have got a lot of experience in working at many different power stations, and we have never had people 24 hours a day to cover an outage. It has always been done through day work.

[2.40pm]

PN3292

I am not challenging your experience in power stations around the world but your experience at Yallourn is limited in that it is a brown coal fired power station?---That is of no significance.

PN3293

No significance?---No.

PN3294

It is the case that so far as - just on the emergency procedures the only people who are in and about the emergency phone are operators?---That is probably correct, in the control room.

PN3295

Mr Howells, at this point all I am putting to you is you at least need one person in the control room 24 hours a day?---Well you have got one. He is on the other unit. We are looking after the other unit. The job is still operating. So there is an individual there all the time.

PN3296

Now, other tasks. Maintaining and adjusting generator hydrogen pressure and purity?---That is assuming you are leaving the generator full of hydrogen. It is not my experience to leave it full of hydrogen. It is my experience to de-gas to air in which case you don't need that to be managed.

PN3297

The liaison with other sections in commissioning of new plant and modifications to existing plant?---You only commission plant towards the end of the outage, in which case you may need to bring an individual in at that point but not during the outage.

PN3298

Attending meetings as requested for daily planning and information meetings?---Well that would seem to suggest we are having meetings in the middle of the night when there is nobody else there.

PN3299

Maintaining and reporting of plant defects to appropriate sections?---But that saying there is plant defects but non of the plant is running so all the defects will have been reported and the work will have been included in the outage.

PN3300

In relation to the manning on that outages - was that subject to discussions during the bargaining period?---It was subject to one of Yallourn's seven fundamentals, yes.

PN3301

Did you actually say to the LCG in Power Ops that when we do outages we would like to have the control room unmanned?---We didn't say - he didn't say we would like to have the control room unmanned. We said there was not a necessity for an individual to man the unit that was shut down with nothing running. And it comes under one of the seven fundamentals which is essential work only on shift.

PN3302

SENIOR DEPUTY PRESIDENT POLITES: Well, let me understand how that works, Mr Howells. If you have got a regularly rostered shift pattern?---Yes.

PN3303

And all of a sudden you have an outage. What do you do to the crew? Do you knock them off or something?---No. Well what it is - well, we have got two units as you are aware in each of the control rooms, so one unit is now out of service, so what I am saying - once all plant is shut down and there is nothing else running there is no need to actually have people there. That is not to say we are going to remove people from shift. They may continue to come in on shift but what I am saying is you can control the whole of the outage with an individual on days. There is not a need for somebody to actually be there to manage it.

PN3304

Yes.

PN3305

MR SLEVIN: And in relation to the practice when outages occur, Mr Howells, it is the busiest time in the control room?---It is busy at the beginning of an outage and it is busy at the end. But during the major portion of the outage it is busy from a maintenance perspective, not from an operations perspective.

PN3306

See I want to put to you that operators are at the greatest demand during an outage. That there are many things to be done and they are required on overtime in many respects during an outage?---As I said, at the beginning of an outage and at the end that may well be the case. But during the central portion of the outage it is maintenance function that is focussed, and there isn't a requirement for operations to be there 24 hours a day. As long as it is managed during the day.

PN3307

Right. And indeed overtime for operators and some operators will work 80 to 90 hours a week during and outage?---I would suggest that that is not necessary and it is certainly not the experience that I have had. And as I said previously I have been involved and managed a lot of these outages.

PN3308

And you don't believe that it is common knowledge within the power station that if an outage is coming up you want to cancel your fishing trips because you will be required to come into work?---I don't believe there is work to be done. As I have been through, the issues I have stated - - -

PN3309

I am not saying whether there is work to be done, it is whether at the moment the expectation of the workers in the control rooms is that if there is an outage on they will be required for overtime?---Are you talking about a short duration outage or a major overhaul?

PN3310

Well a short term outage - - -?---In a short term outage I wouldn't argue that there will be a need for operations presence. But in a major overhaul there certainly will not.

PN3311

And it is the short term outages that happen most often, isn't it, Mr Howells?---There are probably three, four short term outages per unit per year.

PN3312

And major outages - they are much - - -?---The major outages are once every four or five years but there is a significant difference between the two and the short duration ones are two days and the major outages can be six to ten weeks.

PN3313

Thank you, Mr Howells. I have no further questions.

PN3314

SENIOR DEPUTY PRESIDENT POLITES: Yes, Mr Georgiou?

<CROSS-EXAMINATION BY MR GEORGIOU [2.47pm]

PN3315

MR GEORGIOU: Mr Howells, can I take you to your statement G5 thanks?---Is that the first statement?

PN3316

Yes. The first one. And paragraph 67. In paragraph 66 you talk about a resolution passed by the CFMEU and then in paragraph 67 you say:

PN3317

The ASU and later the APESMA adopted the CFMEUs resolution.

PN3318

Have you got any proof that we adopted that resolution?---Not without the letter in front of me and not without the fact that the proposed EB when it arrived had APESMAs logo on the front.

PN3319

No, this is with regard to the resolution, not to whether we - - -?---I don't know because I don't know without seeing the letters associated with that but that is what I was led to believe.

PN3320

Who led you to believe that?---Well I led to believe that the letters that came associated said that APESMA and the ASU were also adopting that resolution and were going along with formulating that enterprise bargaining agreement.

PN3321

When you wrote this you didn't bother to verify it at all? You just accepted - - -?---I can't remember what the letter actually said.

PN3322

Okay. Paragraph 72 of your statement - you talk about a meeting on 21 July. There was an SBU meeting. Has my organisation ever participated in an SBU meeting?---No.

PN3323

No. So the statement that the unions - and implying that my union also rejected the proposal is perhaps not correct?---Well I was led to believe that when the SBU was formed there was going to be nine union representatives on it and I didn't select the nine union representatives so I can't really comment on that - - -

PN3324

So the - - -?---But you are correct in saying that they weren't present at that union - that meeting.

PN3325

So the last statement:

PN3326

The unions rejected Yallourn's proposal.

PN3327

Would be those unions who participated at that SBU meeting?---That was the people who represented, yes.

PN3328

To go to the issue of who is excluded from your proposed MX Award which is covered in 3.2, do you understand that there are professional engineers employed in the mine maintenance department?---Sorry, three point?

PN3329

Two (a)?---3.2. I honestly don't know but I would assume yes, there probably are.

PN3330

Yes. So they wouldn't be covered by this award?---That is correct.

PN3331

What would they be covered by?---They would be covered by whatever document will cover mine maintenance. Probably and enterprise bargaining agreement in that area.

PN3332

To your knowledge have there been any discussions with my organisation about mine maintenance agreements?---No. There has been no discussions with your organisation.

PN3333

No. Do you intend at any stage to have any negotiations with my organisation about the mine maintenance agreement?---The intent was to conduct those negotiations with the maintenance unions.

PN3334

But you have just acknowledged that we have - - -?---Yes, there was no intent for the APESMA to be involved in those discussions.

PN3335

Is there any reason for that?---Because of why we are here today and that basically that was one of the bargaining periods that was cancelled.

PN3336

So - that still doesn't preclude negotiations but - so what will these engineers be governed by?---Whatever enterprise bargaining agreement covers that particular area.

PN3337

So we will be allowed to be signatories to that enterprise agreement?---I would assume if you approached the company then - I don't know, that is within your - - -

PN3338

No, it is within yours because it is your proposal here as to who is to be excluded - - -?---Well I don't know until we have actually reached a point where we have an enterprise bargaining agreement that - - -

PN3339

How are you going with the other unions in the negotiations, do you know?---

PN3340

MR GREEN: I object to that questions for the reasons I have earlier advanced.

PN3341

MR GEORGIOU: I think it is relevant, your Honour, insofar as the witness has stated that we may be able to be partners to that agreement and he has also said that we haven't been involved in any negotiations and so this is an opportunity for him to inform us (1) whether there will be an agreement and (2) whether or not that agreement is in the near future and whether we can be bound by it.

PN3342

SENIOR DEPUTY PRESIDENT POLITES: Well, I suppose there is an other option, that we ought to make the award binding on your members in respect of mine maintenance matters.

PN3343

MR GEORGIOU: No one has put that yet, your Honour. And if there are submissions from the Bench then we are in strife.

PN3344

SENIOR DEPUTY PRESIDENT POLITES: Well it may not be such a bad thing, you don't know what the content of it is.

PN3345

MR GEORGIOU: Yes, Friday afternoons - crack time.

PN3346

SENIOR DEPUTY PRESIDENT POLITES: Yes, I will allow that question, Mr Georgiou.

PN3347

MR GREEN: If the Commission please?---Unfortunately I can't really answer the question because I have not been party to some of the latest discussions with the mine maintenance. I agree that previously I was when I was the maintenance manager but since moving onto the power station only I have not got directly involved with those discussions so I don't really know exactly where they are.

PN3348

MR GEORGIOU: The proposed MX Award also excludes persons who are employed pursuant to an executive employment contract. How is an executive employment contract applied at Yallourn Energy?---Well there are a number people with executive employment contracts.

PN3349

Who - do they get offered those contracts or do they apply for them?---The only people I have known in my time over there approached the company and asked if it was possible to have an executive employment contract.

PN3350

Because in response to a question from Mr Henderson this morning you stated that the company offered contracts and employees can or cannot accept them, were your words, roughly?---That was in - - -

PN3351

So is that - which of the - - -?---That was in reference to the future. I am talking about in terms of the current enterprise bargaining agreement.

PN3352

No, no. I only took a couple of notes this morning and that was one of them. The company offers contracts and employees can or cannot accept them. So that is a contradiction to the position you gave just before. So which is the position? Does an employee - - -?---The position under the current EB? The current enterprise bargaining agreement?

PN3353

Yes?---The position is to my knowledge and experience is people usually approach the company and request could they go onto an executive employment contract.

PN3354

And how do they know what is in an executive employment contract?---Well they usually request to go on it and they are provided with a copy but I don't get involved in the negotiations associated with that so I don't know the detail.

PN3355

Who determines the contents of the contract?---Well I am led to believe there are a number of standard contracts and they are usually - it is usually dictated by the HR department.

PN3356

Have you seen one of these contracts?---No.

PN3357

In drafting that clause for the MX Award, was there any discussion with regard to the types of people who would be covered by those contracts?---In the future or currently?

PN3358

Well you have put in a clause that excludes certain people from the MX Award?---Yes.

PN3359

Was there any discussion as to the types of people who would therefore be excluded by the award?---Well the only discussion was surrounding the fact that those who have currently got executive employment contracts, with respect to that particular clause.

PN3360

You have got a 25 level structure - classification structure at Yallourn at the moment. Is that correct?---This is in the enterprise bargaining agreement?

PN3361

Yes?---Yes.

PN3362

How far down that structure do you go to be able to qualify for an executive contract?---Well I don't know because - I mean I am not even familiar with exactly who is and who isn't on executive employment contracts. But I do know there are people at different levels or different levels that have approached the company in the past with respect to going onto one of those contracts.

PN3363

So if Mr Felsbourg for example - just to use him as an example - was to approach the company and say "I want an executive contract", is that the way he would go about it? Simply approach his manager and ask for one?---That is how it has been done in the past but Mr Felsbourg sits in a position that is actually covered in the EB, and I am sure Mr Felsbourg would take exception to that.

PN3364

So there are no people who are covered by the EB who are currently on executive contracts using EB3?---To be honest I don't know exactly who and who isn't on executive employment contracts, so I don't know.

[2.55pm]

PN3365

To your knowledge have there ever been any negotiations on the content of executive contracts?---Well, as I have never been involved in them I don't know again.

PN3366

As part of the enterprise bargaining negotiations?---No.

PN3367

You are not aware of meetings held between the company and my organisation on that issue?---Not on that issue because the executive employment contracts are outside the enterprise bargaining agreement.

PN3368

Now, I won't agree with that but I am not going to debate it here with you. Were you surprised, therefore, in the union's proposal for an enterprise agreement that there was a clause with regard to employment contracts?---This is the which?

PN3369

The combined - the three unions - - -?---This is in June of last year.

PN3370

I don't remember the dates but it is about June, yes?---Was I surprised by that?

PN3371

Yes?---I found it difficult to understand what it was there because I assumed those people were outside the enterprise bargaining agreement.

PN3372

Why did you assume that?---Because they were on executive employment contracts.

PN3373

But we have just acknowledged that people who are covered by the EB can still ask for an employment contract. Therefore, they are both covered by the enterprise agreement and the employment contract. Are they in your eyes exclusive?---Well, I said I am not sure who is or who isn't on one of these employment contracts.

PN3374

Do you know how many professional engineers and scientists are employed at Yallourn roughly?---Not really, no.

PN3375

Do you know how many engineers and scientists may be covered by your MX Award given the exclusions that you have got?---Again, I don't know.

PN3376

In clause 100 of your statement you talk about award and agreements that are binding and you gained this knowledge from Mr Chapple. Are you aware that there is a superannuation award that regulates superannuation in this industry?---No, I am not.

PN3377

Did Mr Chapple not inform you of that?---I have not discussed that with him, no.

PN3378

In your remuneration of persons on executive contracts what do you use as the basis of the remuneration that you would provide to those persons?---In terms of an executive contract I don't know because I am not involved in that.

PN3379

You talk about relativities in section 102 with regard to comparing a paid rates award with the minimum rates award and the relativities there. In your executive ranks do you do similarly? Do you find a base rate in an industry that may not be relevant and then pay your executives that level?---I don't know how they arrive at that point, no.

PN3380

You don't know any of that and yet you are prepared to exclude people from the coverage of the enterprise agreement?---The only thing I am aware of with the executive employment contracts is basically it is up to the individual when they are presented with it as to whether they wish to pursue that.

PN3381

But you talk in paragraph 108 that clause 10.2 enables employees such as ship managers and team leaders to enter into personal contracts provided those employees are not disadvantaged?---That is correct.

PN3382

If you don't know what is in the contracts how do you know whether they are disadvantaged or not?---Because that is a matter that is dealt with by the HR Department and whilst they are dealing with it they ensure that there is no disadvantage and it is up to the individual whether they wish to sign on to that contract.

PN3383

You also talk in paragraph 107 that clause 10.1 will provide Yallourn with the option of replacing current remuneration arrangements with annualised salaries. The annualised salary must not, however, globally disadvantage employees. What does globally disadvantage mean?---It means that within the team structure, because as we have said in there we offer in the annualised salary, which on the basis that the whole of the team agrees to that and they are not disadvantaged by that.

PN3384

So the award employees, if I can call them that without referring to EB3, because EB3 covered basically award employees and there are engineers and scientists who were award employees - when their annualised salary was formed as part of their contract you put to me that they are not globally disadvantaged or that they are not disadvantaged, is that correct?---I am becoming confused now. Are you talking within the EB or external to the EB?

PN3385

My point is that there are people who have been offered contracts who are still award employees and, therefore, there are different tests to apply. Do you accept that there are award employees who have been offered executive contracts?---Well, as I say I am not entirely sure who is on an executive employment contract.

PN3386

SENIOR DEPUTY POLITES: That wasn't the question, Mr Howells. Ask it again, Mr Georgiou.

PN3387

MR GEORGIOU: Are you aware as to whether there are award employees who are on executive contracts?---In a particular area because - - -

PN3388

In any area.

PN3389

SENIOR DEPUTY PRESIDENT POLITES: No, Mr Georgiou, that wasn't the question. It was are you aware whether there are award employees who have been offered executive contracts?---There may be award employees who have approached for an executive employment contract but I don't know the detail of that.

PN3390

MR GEORGIOU: When your proposed agreement went for a vote of the employees are you aware of any debate as to who was eligible to vote for that proposed enterprise agreement?---When you say debate do you mean with the unions or within the business itself?

PN3391

No, with the unions and in front of Vice-President Ross; I was going to get to that?---There was some debate about who was eligible to vote.

PN3392

And did it involve my particular organisation?---Well, I don't know - - -

PN3393

As to whether members of my organisation were eligible to vote?---Well, I don't know because when that was being conducted it was done with VP Ross and we were in one room and the unions were in another in terms of deciding who was eligible to vote.

PN3394

I will put it to you in another form. Did the company write to VP Ross raising the issue of whether persons who were members of my organisation were eligible to vote for that proposed agreement?---Did they write to you or VP Ross or - - -

PN3395

To VP Ross?---Well, the discussions were about who was eligible to vote and we did have some debate.

PN3396

Right. And what conclusion did you come to?---That all persons were eligible to vote within that area who were covered by the enterprise bargaining agreement.

PN3397

How did you ascertain who was covered by the enterprise bargaining agreement?---We didn't; we were guided by VP Ross.

PN3398

Didn't you come up with a voting list?---We did, yes.

PN3399

And was there no discussion about who was eligible to be on that list or not?---Yes, and that discussion took place with VP Ross, who gave us the guidance on who could vote.

PN3400

And then couldn't you extract from that that people who are eligible to vote, and let us say there were 400, which is roughly right, and you have 550 employees roughly?---Yes.

PN3401

Don't you then make such deductions as to who is ineligible on the basis of that?---Yes, but some of it was done by unions, some of it was done by contract. But I mean I didn't look at the list of who was ineligible. We only formulated a list of who was eligible.

PN3402

Do you know if anyone at the company did that?---Well, we drew up a list of who was eligible to vote.

PN3403

I have got no further questions, your Honours.

PN3404

SENIOR DEPUTY PRESIDENT POLITES: Thank you, Mr Georgiou. Yes, Mr Green, any re-examination?

PN3405

MR GREEN: May it please the Commission.

<RE-EXAMINATION BY MR GREEN [3.06pm]

PN3406

MR GREEN: You have said to Mr Georgiou, Mr Howells, that you found it difficult to see why executive contracts found their way into the union's proposed award. May the witness be shown attachment to his first statement, which is EB3?---I have got a copy of EB3 here.

PN3407

Yes. Would you go to 4.5 there which is at page 8, clause 4.5. That says:

PN3408

This agreement applies to all Yallourn Energy employees except those who enter into executive employment contracts with Yallourn Energy.

PN3409

What impact, if any, did that clause have on your finding it difficult to understand why executive employment contracts got a look in in the union's proposed award?---Well, because currently as I say we have got the division between those who are covered by the award and - by the EB and those that enter into the executive employment contracts.

PN3410

You said in response to Mr Georgiou that there was a document that you saw that had the APESMA logo or stamp on it. May the witness be shown this document, please. That is a letter dated 14 June 2000 from Mr Georgiou and two others addressed to the then CEO of Yallourn Energy. Have you ever seen that letter before?---Yes, this is the letter I was trying to recall when I was talking to Mr Georgiou.

PN3411

Yes. If the Commission please I tender that. We will have copies made of that your Honours and Commissioner Bacon.

PN3412

MR GEORGIOU: Can I just have a look at that before it goes up?

PN3413

MR GREEN: Sure.

PN3414

MR GEORGIOU: Yes.

EXHIBIT #G8 LETTER DATED 14/06/2000 FROM MR GEORGIOU AND TWO OTHERS ADDRESSED TO THE THEN CEO OF YALLOURN ENERGY

PN3415

SENIOR DEPUTY PRESIDENT POLITES: We will return that to you for copies to be made, Mr Green.

PN3416

MR GREEN: Yes, thank you, your Honour. You were asked some questions about Mr Gloucester and dual tradesmen and the like. Has Mr Gloucester ever told you why he wants a second trade qualification?---He personally hasn't told me, no.

PN3417

Have you ever raised with him why he wants a second trade qualification?---I discussed it with others within that area. I discussed it with Steve Brown in actual fact who was the INC team leader and he indicated to me that people were seeking a second trade in there because they knew that others in the Valley were paying well over the odds for people gaining a second trade.

PN3418

And by others in the Valley, to whom are you referring?---He mentioned Australian Paper for one and he also mentioned Loy Yang for another.

PN3419

Did Mr Gloucester ever say to you why he reported Yallourn Energy to the State Training Board?---Because he felt he wasn't getting the required training in accordance with his apprenticeship.

PN3420

Yes, and what do you say about that?---Well, basically I then contacted the State Training Board because I was concerned that we weren't delivering that training, and as I say, I spoke to Mike Cropley who said we should really be delivering 100 per cent of the time to training and just going to the college course wasn't really sufficient to gain an apprenticeship.

PN3421

Now, you gave some evidence in response to questions from my learned friend, Mr Slevin, about possible reductions - reduction of numbers in the control rooms and you told the Commission that the estimate that you gave was based on your experience of up-grades elsewhere. What is your experience of up-grades elsewhere?---The last power station I was involved in managing we also went through an up-grade of this type and we reduced staffing levels within the operations department down to 55 down to 30 once the up-grade was in place. I have - - -

PN3422

What power station was that?---That was Fiddlers Ferry Power Station in the UK.

PN3423

When was that up-graded?---That was about two years ago.

PN3424

You were asked some questions by my learned friend about this Silcar Alliance. May the witness be shown this document, please. That is a letter dated 30 April 2001 from Mr David Wandmaker, Power Station Maintenance Manager, addressed to Mr Brad Gloucester, CFMEU Shop Steward. Have you seen that letter before?---I believe I have seen this letter, yes.

PN3425

And in the second last paragraph of Mr Wandmaker's letter, having referred to previous correspondence between Mr Van Der Muelen and the company he said:

PN3426

If the approval of the affected work group is obtained -

PN3427

and this is just after a reference to clause 7 of EB3:

PN3428

If the approval of the affected work is obtained Yallourn Energy will continue to consult with the affected parties and will seek agreement from the relevant union parties before proceeding with the alliance. The alliance will not proceed in the absence of this agreement.

PN3429

Now, to your knowledge to what extent do those words reflect the attitude of the company towards whether they would proceed with the alliance under EB3?---It reflects the position I was trying to outline in that we were running two consultation processes together, one with the affected work group. We made it clear from the start we would be seeking the agreement of the union once we had satisfied the concerns and the issues within the affected work groups.

PN3430

If the Commission pleases I tender that letter.

EXHIBIT #G9 LETTER DATED 30/04/2001 FROM MR DAVID WANDMAKER TO MR BRAD GLOUCESTER

[3.11pm]

PN3431

SENIOR DEPUTY PRESIDENT POLITES: Is this already in the material somewhere?

PN3432

MR GREEN: That letter isn't, your Honour.

PN3433

SENIOR DEPUTY PRESIDENT POLITES: I had a feeling, I had read something to similar effect.

PN3434

MR GREEN: Your Honour has probably - it is a recurring theme in a number of matters, your Honour, but your Honour might well have come across some letters just before that one.

PN3435

SENIOR DEPUTY PRESIDENT POLITES: Yes, I see.

PN3436

MR GREEN: You were asked a question about exhibit G7, which sets out a mine maintenance structure, by my friend Mr Henderson, yesterday. Mr Henderson was seeking to clarify the purpose of exhibit G7. Do you have a copy of that in front of you? We can provide one if you haven't?---I don't think I have actually, no.

PN3437

May the witness be shown that please. To what extent does that structure in G7, represent the present position on the ground at Yallourn Energy?---I believe relates to the mine maintenance structure as it stands.

PN3438

To what extent does what is in that structure, reflect or otherwise, what it is that the company is seeking through the award that is proposed?---This is the structure that we would seek at the start. I mean this is the part of the business we see as being mine maintenance - as being defined as mine maintenance.

PN3439

If the Commission pleases.

PN3440

SENIOR DEPUTY PRESIDENT POLITES: Thank you. Thank for your evidence, Mr Howells.

PN3441

MR GREEN: Sorry, there was one other matter I wanted to pursue. Mr Henderson, or one of his successors asked you some questions about an application for a stand down clause, to be inserted or varied in the EB3, in the course of the year 2000. May the witness be shown this document please. Do you identify the document in front of you as a copy application by the company, dated 24 January 2000, to have the certified agreement which is EB3 varied, by the insertion of a stand down clause?---Yes.

PN3442

Yes. If the Commission please, I tender that.

EXHIBIT #E10 COPY APPLICATION DATED 24/01/2000

PN3443

MR GREEN: You have already given evidence about this, but in the event that application wasn't proceeded with. Is that fair comment?---That is correct, yes.

PN3444

If the Commission pleases, that concludes the re-examination.

PN3445

SENIOR DEPUTY PRESIDENT POLITES: This time you are excused.

<THE WITNESS WITHDREW [3.15pm]

PN3446

MR GREEN: That completes the material on behalf of the applicant, your Honours and Commissioner.

PN3447

SENIOR DEPUTY PRESIDENT POLITES: Thank you. Is there any agreement at the Bar table as to who should - - -

PN3448

MR SLEVIN: There was a view expressed, I am not sure there is agreement. I would seek indulgence of the Commission to adjourn at this point, rather than commence our opening, if your Honours and Commissioner please.

PN3449

SENIOR DEPUTY PRESIDENT POLITES: Well, we have set aside some extra time. On that basis, we will adjourn. We will adjourn until 10.30 am on Tuesday, 12 June.

ADJOURNED UNTIL TUESDAY, 12 JUNE 2001 [3.17pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

<PAUL HOWELLS, on former affirmation
CROSS-EXAMINATION BY MR HENDERSON PN2711
CROSS-EXAMINATION BY MR SLEVIN PN2761
CROSS-EXAMINATION BY MR GEORGIOU PN3315
RE-EXAMINATION BY MR GREEN PN3406
EXHIBIT #G8 LETTER DATED 14/06/2000 FROM MR GEORGIOU AND TWO OTHERS ADDRESSED TO THE THEN CEO OF YALLOURN ENERGY PN3415
EXHIBIT #G9 LETTER DATED 30/04/2001 FROM MR DAVID WANDMAKER TO MR BRAD GLOUCESTER PN3431
EXHIBIT #E10 COPY APPLICATION DATED 24/01/2000 PN3443
WITNESS WITHDREW PN3446