BP2001/3211, Transcript of Proceedings [2001] AIRCTrans 2249 (6 September 2001)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER REDMOND

BP2001/3211

TRISTAR STEERING AND SUSPENSION
AUSTRALIA LIMITED

Application under section 170MW of the Act
to suspend/terminate bargaining period with
AWU, AMWU, CEPU and NUW

SYDNEY

3.15 PM, MONDAY 6 AUGUST 2001

Continued from 2.8.01

PN860

THE COMMISSIONER: Any changes in appearances?

PN861

MR HIGGINS: If I could just announce, Commissioner, I have with me today STEPHEN SMITH who is National Industrial Relations Manager of Australian Industry Group.

PN862

THE COMMISSIONER: Yes, thank you.

PN863

MR THISTLEWAITE: If it pleases, Commissioner, with me is MR B. SHORTEN, the National Secretary of the Australian Workers Union.

PN864

THE COMMISSIONER: Thank you, Mr Thistlewaite.

PN865

MR WALLACE: Commissioner, with me MR D. CAMERON, the Secretary of the AMWU and MR D. OLIVER, the Assistant National Secretary of the AMWU.

PN866

THE COMMISSIONER: Yes, thank you, Mr Wallace. Gentlemen, I heard this matter on Wednesday and Thursday of last week. I indicated to the parties that I would make a decision in respect of this matter today. However, I asked the parties to go away an conciliate on the matter over Friday and the weekend. I understand that has happened and I was before deciding on my decision requiring the parties to give me a report back on those matters. Yes, Mr Cameron.

PN867

MR CAMERON: Thank you, Mr Commissioner. Since the last hearing in the Commission there have been two meetings between the parties, one meeting on Friday, 3 August, and another meeting on Sunday 5 August. Those meetings lasted approximately 17 hours in total. I have to say, Mr Commissioner, I have been a full-time official in the union movement now for 20 years and I have got to say these discussions were the most frustrating, most amateurish and non-productive meetings that I have ever been involved in.

PN868

I believe that the behaviour of the company and AIG were simply designed to filibuster until the Australian Industrial Relations Commission terminates or suspends the bargaining period. It is my submission that no genuine attempt was made to bargain, no concessions were made under fundamental claim of the work-force for a trust fund such as Manusafe and the AIGs focus was simply on an insurance bond, and the threshold issue of the security of entitlement and safeguarding workers' entitlements was not dealt with legitimately or genuinely.

PN869

Mr Commissioner, we had one delegate at those discussions. That delegate is 52 years old. He has got two children. He earns $35,000 a year and his total superannuation entitlements at this stage are $15,000. He has absolutely a push and a commitment to have the security of his entitlements because with $15,000 superannuation there is absolutely no chance that that will secure his, his children's or his family's future. So it is a fundamental issue. I have to say this delegate is not unique at Tristar. The key issues in these meetings were the trust fund such as Manusafe, wages, the issue of contract labour and the issue of award coverage for salary and supervisory people at Tristar.

PN870

With the threshold issue, Commissioner, was the protection of entitlements, and given what I have outlined by the delegate's financial position, the security of entitlements for workers at Tristar is absolutely fundamental. We had a meeting on the 3rd, last Friday. Attending that meeting were Vincent Kong, the General Manager, Robyn Matthews, I think he is the Production Manager of Tristar, and David Hargraves from AIG, not one of those people a decision maker, not one of them. Not one person of substance in relation to this dispute. Not one person with the capacity to bring closure to this dispute.

PN871

As an initial situation we sought details of Tristar's financial position. We wanted to inform ourselves of the issues confronting the company in relation to employee entitlements. We asked for details which are normal balance sheet information, issues such as the assets of the company, the cash at hand, the receivables, the inventories and any other cash or current assets. Related to non-current assets we sought information and the company's position on property, plant and equipment and we asked what current liabilities, such as accounts payable and provisions, the company had on its books.

PN872

The company refused to answer and the delegate's advice to me is that the company has previously refused to answer any questions on its financial viability or status. Mr Commissioner, we are so unclear as to whether Tristar has any liquid assets. We are unclear as to whether this company is viable and whether this company can protect the entitlements that are accruing through our members and members of the unions at the plant. Given our concerns over this, we made an initial claim on the company as part of negotiations for the estimated accrued entitlements of $17,000,000 to be paid into a trust fund and that trust fund be Manusafe.

PN873

The company's position was that the bond was the only way forward. The company claimed that the bond was at considerable cost to the company, therefore the package of 5 per cent in the first year of the forthcoming agreement and 5 per cent in the second year of the forthcoming agreement would be discounted by 1 per cent in the first year and 1 per cent in the second year to help pay for the bond. Mr Commissioner, that is approximately $750 loss of pay for the average worker at Tristar. It is the most bizarre offer, and I use offer loosely, is the most bizarre offer that I have ever heard in an attempt to settle a serious industrial dispute.

PN874

I would submit it was not a serious attempt. It was a continuation of the filibuster approach not to bargain seriously, not to bargain in good faith and to attempt to bring this dispute to this Commission where the company can run and hide under the protection of the Act. Mr Commissioner, on the 3rd no further progress was made because of this bizarre position that the company put to the unions. Discussions broke down.

PN875

Mr Commissioner, if you have been following this dispute in the media, and I am sure you have, you would understand that the unions have said on several occasions that we are extremely keen to resolve this dispute. We want a negotiated settlement and on that basis I left a message with the Chief Executive Officer of the AIG at AIGs head office in North Sydney for Bob Herbert to contact me, and I also left a message on his mobile phone. I left a message for him to ring to discuss whether further discussions could take place over the weekend and I also made public statements proposing a meeting over that weekend.

PN876

I was contacted by the AIG over that weekend by Stephen Smith and we organised to meet initially at the Chalmers Street offices of the AMWU at 2 pm on Sunday. I received a couple of what I would describe as fairly frantic phone calls to say no, we cannot meet at Chalmers Street, we should meet at the Australian Industrial Relations Commission and negotiations would take place there. No problem. We came along at 2 o'clock on Sunday to the Industrial Commission. I have to say, Mr Commissioner, this venue is totally unsatisfactory for serious industrial negotiations, totally unsatisfactory.

PN877

We did not even have enough chairs for our delegates to sit down. There were no whiteboards, no computers, nothing to record any of the discussions or try and work through any progress. We did not even have any drinking water at one stage in the place. Every time we left the meeting to stretch our legs - and that was numerous occasions because we had to continually wait for this company who had no decision makers at the meeting to confer for lengthy periods of time either with the AIG or with Tristar management. Every time we left the building we were locked out. It was a joke. It was almost like Abbott and Costello, and I do not know who is the funniest, the current or the past.

PN878

I must say, Mr Commissioner, the issues are still before us that we moved to deal with in relation to this dispute. Initially we raised the issue of portability of entitlements, protection of entitlements, the use of a trust fund, for example, Manusafe. I did indicate and tabled to the company that there was huge public support for this dispute, and I tabled an editorial from the Sun Herald of that day, that Sunday. Mr Commissioner, that was August 5 2001. It was part of the negotiations and part of the tabling of documents and I would like to read it into the record to inform the Commission. In the editorial of the Sun Herald in Sydney on August 2001 is headed: these strikers' right to fight. It goes on to say:

PN879

No one likes a strike. Federal Workplace Relations Minister Tony Abbott seems to believe that unions revel in industrial action. The reality is that very few union leaders enjoy a fight that costs their members money and raises tempers in the workplace, but sometimes issues of great principle, such as job security, are at stake. The dispute at car parts manufacturer Tristar is one such case and Abbott should think very carefully before denouncing strikers as economic traitors as he did on Thursday.

PN880

The 300 Tristar workers are striking to protect their entitlements in the all too frequent event of a company collapse leaving the trained staff without holiday pay, long-service leave, superannuation and redundancy pay. Given the events of the past two years as countless small factories hit the wall short changing employees, who can blame them? What estimate puts the amount lost in employee entitlements at $400,000,000 a year? Remember when National Textiles in the Hunter Valley collapsed early last year with the Prime Minister's brother Stan Howard at the helm as chairman. It took massive national pressure to ensure that the employees, mostly middle aged women with children to educate and mortgages to pay, got their due.

PN881

Tristar changed hands in a fire sale late last year. The employees are understandably suspicious that the company could be stripped of assets leaving them in the lurch. The new owners have also discarded an earlier agreement to ensure redundancy payments. The workers could be forced out of their jobs and made to walk away with empty pockets. Can we blame them for standing up for themselves? The Tristar dispute is a direct result of the Howard government's failure to protect workers' entitlements. Abbott's economic treachery outburst was based on his claim that a strike would encourage Mitsubishi to pull out of Australia a $17 billion a year car making industry. He was crying wolf. Mitsubishi has decided to maintain its Adelaide plant and build another range of Magnas.

PN882

Of course, if the unions escalate the strike to other companies they would find it hard to maintain the public sympathy they presently and legitimately enjoy on this issue. It could also damage the Federal election prospects for the Labour opposition which may not get to realise its stated commitment to secure hard won entitlements. The government clearly bungled the dispute. Before Peter Reith became the Minister against industrial relations, as opposition front bencher Bob McMullen once cheekily observed, and long before Abbott began hurling accusations of treachery, Industrial Relations Ministers actually tried to mediate in industrial dispute. Recall Lawrie Brereton's hands on work during the 1995 Weipa mining dispute. Who is offering to broker a deal today?

PN883

I would like to remind the Commission that this is the Murdoch press, this is the Sun Herald, this is an editorial. It is not my column that the AMWU use. This is a serious analysis by the Murdoch press of this dispute.

PN884

THE COMMISSIONER: What paper did you say it was?

PN885

MR CAMERON: It is the Sun Herald.

PN886

THE COMMISSIONER: I do not think he owns that paper, does he?

PN887

MR ..........: Fairfax.

PN888

MR CAMERON: Fairfax. Sorry.

PN889

THE COMMISSIONER: You can blame him for a lot of things but not that, Mr Cameron.

PN890

MR CAMERON: I thought I had really hit the jackpot when Murdoch was there. Fairfax will do. I do not agree with him all the time, especially a well known industrial reporter at times, Mr Commissioner, but that will do for an editorial. Seriously, it is a very telling analysis by a body independent of this industrial dispute, by a newspaper who are saying that this dispute is a legitimate dispute and the workers are entitled to strike. The matter that is before you today is an application to say that the workers should not be entitled to strike.

PN891

We indicated through the meeting on the Sunday that we had huge public support, and that is the position. We have huge public support in this dispute. This dispute could be resolved, could be resolved. It should not be a political issue. I put this position to the company. It should not be a political issue. We do not need Tony Abbott using invective and vindictive language from the side line. We would welcome the Minister being here to sit down with the parties to help negotiate the matter through. If that is too much for the Minister, so be it. If all he is good at is invective and workers that are engaged in economic treason, he will be judged by the community on that position.

PN892

It should not be a political dispute. It should not be an industrial dispute. It is really an issue of morality. It is an issue of the workers having the rights to their own money. It is a moral issue. We believe strongly that the company has a moral obligation to settle it. They should not be coming here trying to use the Industrial Legislation and the Industrial Commission to justify their position of not bringing one person of substance to the bargaining table and filibustering for 17 hours on this issue. The threshold issue is the issue of a trust fund such as Manusafe.

PN893

We indicated from our first position we moved a long way. We indicated our first position was Manusafe. We then said we would compromise on Manusafe and a bond. We said let us have a position where we can satisfy the company's position of a bond and satisfy the union's position of a trust fund. We indicated initially that the total long-service leave provisions accrued for all workers at Tristar should be transferred to a trust fund, transferred to Manusafe and the ongoing entitlements looked after by a 1.5 per cent payment into Manusafe each week. We tried to dispel the company argument that the 1.5 per cent was some 1.5 per cent cost. It is not a 1.5 per cent cost because the bulk of that 1.5 per cent is already an existing obligation on the company for its long-service leave entitlements.

PN894

The company raised the issue of portability and argued that what we were trying to achieve was a new improved condition. We did indicate to the company that we were prepared to moderate that position, move away from that position if it allowed a settlement of the dispute, another compromise position from the unions. We compromised on, say, 17,000,000 at Manusafe. We moved to the long-service leave provisions plus portability. We moved back off that and said put in the long-service leave provisions. At each step the AIG and the company were under instructions not to move, under instructions. It was not a genuine position by the parties at the table because they had no independent position, no independent authority to negotiate.

PN895

We had compromised. We then said let us move to the bond. Let us identify the issues of this bond. We said firstly we want a copy of the bond. We want to know who the underwriters are. We want to know what the conditions are in the bond. We want to know what the cost is on the bond. We want to know if you are prepared to pay the bond up front. We want to know how you will deal with the issue of renewal of the bond. We want to know what you will do about future increases in the bond. What is the position if cover is withdrawn. Given that AIG had said none of these issues were a problem, this is bullet proof, this approach, we said, well, let the directors underwrite it if it is so great. If it is so bullet proof give us an underwritten position that that will be the position.

PN896

If the insurance company goes down, if we have another HIH on our hands you let the directors underwrite this. Then we moved on and said we should then discuss Manusafe when we had a position back on these issues. I am not sure how long the recess was or whether we were locked downstairs or what happened, but hours later we finally get the company coming back after they go and get their instructions again to come back and say: well, the document is not drawn up yet. Here we are, probably one of the most serious industrial disputes for a long time in this country and the fundamental issue in the company's argument to settle it, the core settling position, they do not have a document that they can put to us. Not one word can they put to us.

PN897

On the underwriters, they must have went to the phone book and said: give us some underwriters quick. They came back with Zurich, Tralich, American IE, National Australia Trustees. I am not sure whether it was pick-a-box, where we were being asked to pick one, but these underwriters were all there, all queuing up to have this great fix to this industrial dispute. It just so happened we had no documentation and absolutely nothing of substance before us. Again I say it is a demonstration that this company and the AIG had no intention of negotiating during those 17 hours, absolutely no intention.

PN898

They then told us that the conditions in the bond would be those of some previous bond which included penal provisions against the unions if they misbehaved. They said the cost of the bond was somewhere in the region of 3 to 4 per cent of payroll. It could be anywhere up to $400,000 per annum, more. We have got estimates that this could be a commitment and an obligation on this company of about $1.6 million over the life of the agreement. It is a huge amount of money for a bond, an insurance of the entitlements that should be safe. They should not need to insure this because they should be set aside, they should be safe.

PN899

We rejected that position. We then had the debate about entitlements and who they belonged to. I am sure we can go back and we can look at law books, we can look at industrial relations history, we can get precedents, we can spend all day looking at what entitlements are, but we are now in the 21st century, Mr Commissioner, and I would have thought it is pretty obvious, pretty obvious that the entitlements that belong to a worker are actually workers' entitlements, their money, not money for companies to do with what they would like, not the position. Mr Kong under not very vigorous questioning, I must say, not very vigorous questioning, considered that the money was the workers'.

PN900

We asked a couple of the delegates: how much have you got in long-service leave? I think somebody said: I've got about $9000. We said: Mr Kong, whose money is that? Mr Kong being what I thought was fairly honest at that time said it is the workers' money. Unfortunately the AIG went into apoplexy and Mr Kong's left ear was chewed off, chewed off. Then Mr Kong had to recant his position, recant his position. It was not really the workers' money because they have only got an entitlement, they do not have money, was the advice from the AIG to Mr Kong.

PN901

Well, we do not believe that is good enough and we are determined that that position must change at Tristar. We then raised the issue of Manusafe. That issue was again swiftly rejected, no considered position, simply rejected. The company said there are administrative problems with Manusafe. Dave Oliver, Mr Commissioner, will make some submissions on our response to the detail of that because they are very, very important to this hearing. They said there are administrative problems, there are cost problems, there are cash flow issues and there are taxation issues. We indicated to the company that there were answers on each one of them. Dave Oliver will take us to them in detail but let me just give you a couple of examples.

PN902

In terms of the cash flow issue, we estimate they have the long-service leave entitlements in a trust fund, that those long-service leave entitlements would amount to some $3000 a week. If this creates cash flow problems for Tristar we have got real concerns as to whether this company has got liquid assets. We are very concerned as to what the Sun Herald is saying, has there been asset stripping in this company? Where is the money because no one will tell us. The workers tell us that the parent company has got assets but nobody will tell us that Tristar has got assets and that is where the employer-employee relationship stands, with the company and the employees, not with any parent company.

PN903

In relation to the taxation issues they said: we will have this huge problem in tax. We indicated that we had verbal advice from Gardens, who are specialist taxation lawyers, that that was not the case. We have correspondence here from Ross Sellar from Gardens lawyers - remember these are specialist taxation lawyers, not like the general lawyers that the AIG used to propagate their propaganda and misinformation. This correspondence says this. It is for Jim Angelas, the Coverforce Director. "Dear Mr Angelas -" and it is headed: Manusafe Benefit Trust:

PN904

I refer to our telephone conversation this morning relating to the Manusafe Benefit Trust. As requested I can confirm that we received preliminary comments from the ATO on 25 July 2001. In relation to the deductions to be claimed by employers for contributions to the trust the ATO has confirmed verbally that employers will be able to claim an income tax deduction for such payments and that given the nature of the trust the general anti-avoidance provisions of the Income Tax Assessment Act will not apply. I trust this is sufficient for your immediate purposes. If you have any further queries, please do not hesitate to contact me.

PN905

So the issue of cash flow, $3000 a week, they cannot afford that, this company is in substantial trouble, substantial trouble. If they cannot resolve a dispute that they claim is threatening the whole world, not just the vehicle manufacturing industry, then they are in significant financial problems. $300,000 over a two-year agreement will fix this dispute. We have dealt with every issue and Dave Oliver will deal with that in detail. We then raised with the company the issue that two companies - because the company was starting to talk like: we don't want to be the first cab off the rank. Said there were two companies that served Australia, Walkers and Monro Springs, who had placed written offers on the table during the current bargaining round to say that they would pay into a trust fund 1.5 per cent which represented the long-service leave provision and the accruing entitlements.

PN906

That would have provided portability of entitlements and an improved benefit at both those companies. Well, we thought we were trying to be reasonable. We thought we were trying to be open and honest with the AIG and this company. But what has happened today, Mr Commissioner? People talk about pattern bargaining. Well, the author is off the table at Walkers. The author is off the table at Monro Springs. Why is the author off the table? I would speculate that maybe Bob Herbert has eventually got up off his backside and done something but Bob will inflame this dispute by getting these companies to take this off the table so there is no precedent for this company to have to deal with.

PN907

The company then put a position to us, that they would put wording in the agreement that said: three months before expiry we will talk to you about trust funds, what is the most appropriate way to deal with employee entitlements. We will put that in the agreement and then we can have a look at it. It just shows you how confident they are about the insurance bond. They are either telling us lies or they are not confident about the insurance bond. If they were confident of the insurance bond they would not be saying: let us assess this three months prior to expiry. They would be saying: we've got the fix. But no, they are saying: we will have a look at this three months from expiry.

PN908

My view is they are doing exactly the same thing they did in the last agreement. When workers raised the issue of a trust fund, Manusafe, for their entitlements, what they did last time was say: we will talk to you about this. They did that, looked workers in the eye and said: we will do that genuinely. When we raised that - and it was before proceedings in this Commission, Mr Commissioner, I think in January 2000, before proceedings in this Commission - do you know the responses, how genuine these people are? They said basically: we've had a look at it, we've assessed it, we've rejected it. That is how their commitments operate, absolutely no validity, absolutely no courage, absolutely no commitment, and we are being asked to trust this company. No way.

PN909

They also said, AIG: take the insurance bond, take that bond and we'll sit down with you at the national level and discuss this thing. Well, I think that offer is every bit as genuine as the Tristar workers' offer that AIG brokered last time. It is meaningless. It is a con. It is a meaningless tactic to try and deflect away from the importance of dealing with this issue at Tristar. I have got to say to you if this company has got a cash flow problem for $3000 we want to know where the money is. I would ask you, with respect, Mr Commissioner, with your obligation to settle disputes, you have got an obligation to find out whether this company has got any liquid assets or whether they have been dealing with us right throughout these negotiations in a very, very unprincipled way.

PN910

Our view is the company's strategy was they hang these negotiations out, never ever being genuine about resolving it. If they were genuine about resolving it Bob Herbert and Chen Hong, the Managing Director, would have been sitting there with the national leadership of the unions, the state leadership of the unions and the leadership of the workers at the local level. They would have been sitting there working this through. But what did they do? They sent in the B team. They sent in the B team. The B team could not make a decision. The B team had no authority to do anything, nothing. Seventeen hours of: we've got to go and make a phone call. It is an absolute disgrace. It is the most amateurish performance I have ever seen from AIG in my experience.

PN911

Their view is: hang them out, con them and what we'll do is we'll get them in the Commission on Monday afternoon. 3 o'clock Monday afternoon the bargaining period is terminated. We can ring Bob Herbert up. We can ring Chen Hong up and say: your problem is over. You did not really need to make a commitment to resolve this because the bargaining period is terminated and Commissioner Redmond is ordering a return to work. That is the strategy. That is the simple position from these people and I would not call them negotiators because they were not negotiators. They were there to filibuster. They would have made some of our politicians in the New South Wales Upper House look as if they were dumb mutes.

PN912

Mr Commissioner, we understand that Tony Abbott has made some public statements about intervening in this dispute. As I understood it he was going to intervene on the basis of supporting a termination of the bargaining period or a suspension of the bargaining period with a view to resolving the dispute. Where does this Minister get off? I mean, that will not resolve this dispute. That is not a process to have a genuine bargaining system in this country. The Minister is demonstrating his total lack of experience in his portfolio and his ideological venom against working people in this country by the position he has taken against workers at Tristar.

PN913

I have to say there was one issue that came out loud and clear by our members at Tristar today when we had a meeting there today. They are absolutely appalled. They are angry over the public comments of Tony Abbott accusing them of treason, accusing working people of treason in an unprecedented outburst from that so-called Minister of the Crown. Our position is Tony Abbott should get his backside down here now and he should help us negotiate our way through this issue. He should show some intellectual leadership, he should show some intestinal fortitude and he should be here assisting in the resolution of this dispute, not from the side lines telling these companies that they should hang tough and they should force workers into capitulation. It is absolutely disgraceful.

PN914

We understand that the AIG have put processes in place, the 127 orders against the unions, as soon as your decision is made. Mr Commissioner, I hope you give them a surprise. I hope you give them a surprise. I hope that you, with the greatest of respect, analyse this dispute in the context of this company's behaviour, in the context that the vehicle industry from time to time does suffer problems and that this issue does not create the basis of terminating the bargaining period in this dispute. Because, Mr Commissioner, all you will be doing is rewarding the bad behaviour of Tristar and the AIG. All you will be doing is rewarding Tony Abbott for his venom and vindictiveness. You should not, with the greatest respect, Mr Commissioner, allow that to happen.

PN915

You should consider very, very carefully, very carefully the rights of these workers who are being treated with absolute contempt by both the Minister, the employer and the AIG. Let me tell you we have got the Australian public on our side, the Minister, the AIG and the company on the other side. That is the reality, and if you take, Mr Commissioner, a courageous decision, a courageous decision, you will not terminate this bargaining period and you will order an immediate resumption of the discussions and you will order Bob Herbert to get his backside up here and you will order Chen Hong to be here as well so that the A team is playing and the B team can go and have a rest and watch from the side lines. That is what you should be doing, with the greatest respect, Mr Commissioner.

PN916

We would seek a compulsory conference in relation to this. We would ask you to support that position. The last thing I want to put to you though is the resolution that was carried by Tristar workers this morning. The resolution says the following:

PN917

This meetings of Tristar workers expresses grave concern as to the failure of the company to provide a negotiating group with sufficient information to satisfy the membership of the financial viability of the company. We note that the company has refused to provide information on whether there is sufficient cash at hand to cover accrued long-service leave entitlements or any other benefits due to workers. This meeting believes that we have no option but to continue to fight for an agreement which secures our legal entitlements in a secure trust fund, eg, Manusafe. We regret the disruption to our fellow workers in the vehicle industry and ask for their continued understanding of the importance of this dispute to safeguard our financial entitlements and security.

PN918

Mr Commissioner, there were two representatives of the workers at Mitsubishi in South Australia and General Motors in South Australia who came to the meeting this morning to express their solidarity and support for those workers at Tristar. The workers at Tristar then went on to say:

PN919

We thank vehicle industry workers for the expressions of support and solidarity. We endorse the position adopted by the negotiating group to negotiate in good faith and compromise on a range of matters designed to secure a fair and equitable resolution to the dispute. We express our concerns at the vagueness and uncertainty of the company's insurance bond proposal and reject the bond in isolation as a fair, proper and equitable settlement of the dispute. On the basis of the company's failure to respond to the genuine fears and concerns raised by the negotiating group we have no option but to continue the dispute. Further, we call on AIG Chief Executive Officer Bob Herbert and the Chief Executive Officer of Tristar Chen Hong to immediately commence negotiations in good faith with the negotiating team.

PN920

Mr Commissioner, that resolution was carried unanimously by the membership of the four unions at Tristar this morning. Mr Commissioner, I would urge you to take into consideration the issues that arise from this fiasco that was supposed to be negotiations. We would urge you to look further into the financial viability of this company. We would ask you to have a compulsory conference to ensure that Tristar workers get a fair go in this Commission. We would ask you, with the greatest of respect, to exercise your powers with some compassion, some wisdom and with an eye to resolving this dispute. If the Commission pleases, that is my submissions on this matter and I would ask Bill Shorten to take up some of these matters I have raised and put whatever submissions he would have, if the Commission pleases.

PN921

THE COMMISSIONER: Yes. Mr Shorten.

PN922

MR SHORTEN: If the Commission pleases, this is my first appearance in front of the Sydney Commission and I did not think it would be in such circumstances. For the Australian Workers Union what we see at stake is a debate about $17,000,000 in existing entitlements, what happens to future entitlements as they fall due at Tristar in Marrickville where it is probably the largest manufacturing employer remaining and where the employees are genuinely concerned about their future.

PN923

The Australian Workers Union does not believe that we are at an impossible distance between ourselves and the company in this dispute. If you like, what we shall do briefly is Mr Cameron has taken the traditional bad cop role in the dispute and it is probably left to us to be the good cop in the negotiations.

PN924

MR CAMERON: I had not noticed.

PN925

MR SHORTEN: I will just in my submissions touch briefly on where we see that we are apart factually, why we see we are apart and what steps we believe would fix this matter rather than the termination of the bargaining period. If in the event the Commission is still so minded to terminate the bargaining period or suspend the bargaining period we would say that in the light of our submissions that I shall make the conciliation of this matter at the earliest possible time is the most obvious step towards resolving the dispute.

PN926

In addition we have been informed, and we will just touch upon briefly, by the employers in negotiations during the weekend that it is their intention to lodge a section 127 application under the Workplace Relations Act. Whilst we have not been served we have been told this is coming - we have not seen it - we believe that that application would be premature and if the Commission wishes we are happy to respond on that point. Turning to what we think is where we are apart. When the sound and the fury of the debate is moved we think that this is clearly primarily a dispute about the security of entitlements of workers.

PN927

There have been two proposals when we talk about the security of employee entitlements on the table. First of all, what is the adequacy of the company's proposal of an insurance bond and what is the adequacy of the combined trade unions' position in terms of Manusafe for an independent trust fund? Where we see ourselves on the insurance bond is the AWU do believe the company did make some efforts to try and address our concerns but some key questions did remain unresolved. These, the membership at Tristar today quite rightly resolved, meant that we could not move further on accepting the insurance bond proposition.

PN928

The sort of questions we asked, and in all good due diligence to our members we need the information on, is the company could not provide us with any policy statements. They could provide us with a list of recitals or principles which would go into an insurance bond but they could not provide us the details - and I do not just mean the speculative names of a list of underwriters. They could not provide us with the policy statements. They could not provide us with the quotes from the underwriters. They could not provide us with documents which we could reasonably cross-check with our own business and financial advisers.

PN929

To put simply and to finish on this point, they were basically recommending to us that we say to our members: accept a home insurance policy without knowing who the insurance company is, without being able to see the details of the insurance, without knowing exactly what is covered. Now, we would not recommend that to our members to do that in their domestic lives so we would hardly be carrying out or role as union officials to recommend a speculative document which we had not sighted to our members in this industrial dispute.

PN930

We do not say that we think it is beyond the company to develop this information but we think it is exceedingly naive that the company, and almost unfair of them, to characterise our position as unreasonable when they cannot provide something as basic as an insurance policy. Turning to the issue of the role of the independent trust account. There has been a lot written about Manusafe which was the initial preferred prototype of the unions. The company said: well, listen, we are offering you a perfectly good insurance bond proposition, which we could not sight, other than the general principles, but in turn they said: but your Manusafe is - and without going into hours of what they described it - is a union dominated program full of costs and lots of potential tricks and shadows.

PN931

The AMWU and the AWU and the ETU who were present at these negotiations did make this very significant concession. They did indicate: we are prepared, we cannot convince you, providing you give a fair hearing on Manusafe. We do want to talk about the principle of an independent trust account. We believe it is appropriate that if you expect the unions to recommend to their members to accept an insurance policy, which we cannot sight, for $17,000,000 of pre-existing entitlements, we said if we are all concerned about employee entitlements, and I do not particularly suppose the company is not, then what we need to do is see a package of items, and we did suggest as a compromise - and I will come back to this point - we did suggest as a concession, as a significant concession, not without heartache to some of the union officials in the negotiations, that all that we required for a trust account would be the future accruals of long-service leave. I will come back to what we think that is and the numbers.

PN932

I think removing the rhetoric and the political sort of smoke from the debate, when we get down to the bottom of it this is such a fixable dispute that we do believe it would be inappropriate at this stage to terminate the bargaining period. Specifically we indicated there is no cost. There is no administrative fee. We indicated that the cash flow to the company, the big debate about can a company secure employees' entitlements in a trust account outside its own balance sheet would affect radically its cash flow. We have identified, and it is a matter of record, that Tristar paid $11.6 million approximately in the last financial year in salaries, 11.6 million.

PN933

We indicated that we did not as a concession expect them to pay future long-service leave accruals for people who were not currently eligible. So we indicated that we believed as a package for us to go out and satisfy a concern of membership about the security of entitlements. We indicated that the minimum position which we thought might float with our membership would be 1.5 per cent of the salary bill of the company for those who are eligible to receive long-service leave.

PN934

So when we talk about a big company, which Tristar is, of $11.6 million and a dispute which apparently is causing great heartache to the car industry - and I am not necessarily saying that the stand-downs are not happening because they are - it would have cost Tristar to satisfy the concerns of their employees $130,000 a year. What we also said is this is not a union run plot, this is not a cabal of Sydney union officials trying to raise some war chests for strikes or what have you. Instead we offered that Tristar would have some representatives on a committee and employees from the various unions could be on a committee.

PN935

This is not radical interference with the company's finances. What is does undeniably do is in an enterprise agreement where it is appropriate for members to seek conditions pertaining to their employment relationship, what is keeping us apart, the unions are willing, provided the company can convince us of all of the bona fides and details of the insurance bond, to accept that the company is at least trying to do something. What the company could not bring itself to do despite the union, you know, reducing its position from the tallest tree in the forest to the equivalent of a toothpick almost, they still could not bring themselves to that option of compromise.

PN936

Our members then, of course, say this is one of the reasons why we are apart, the insurance bond details, and the second reason being that if the company cannot come to the party in terms of assuring ourselves for the future, in terms of future accrual of entitlements, then we have not got an agreement, but that distance is not great. I will come back finally to that figure at the end. In addition there are three other matters which do not appear to be causing the same amount of controversy, although the company has not proven able to provide us a response.

PN937

We have concerns about the way labour hire is employed on the site, in terms of the duration, in terms of the percentage of the total work-force. We think these matters can be conciliated on. We have a concern that employees - there are a number of employees between 21 and 30 who have not been covered by the current enterprise agreements. Their classifications fall appropriately within part 2 of the Metal Engineering Award and we think that this could be fixed. We also do have a probably more significant concern which is inextricably bound up with the package, both the trust account and the insurance bond. This is the fifth and final issue.

PN938

The company did offer 5 and 5 for the enterprise agreement. On Friday they however said: we will reduce the 5 and 5 per cent per annum to 4 and 4. Instead, the 2 per cent which we had offered you as pay we will put towards the cost of the insurance bond. Now, there has been an insurance bond on this site. So what the company did, and it is not sophisticated bargaining, is they put on 5 and 5, remembering that the employees already had the entitlement of the insurance bond, they already had it. Then they came back in a master stroke and said, one step forward and two steps back: we will reduce the pay offer and we will discount the proposed pay rise and get you to pay part of the cost of the insurance bond.

PN939

Now, I have not seen in industrial relations in recent times - that is an obvious provocative step whereby they are asking you to discount an offer you have already had on the table in order to gain a condition which you previously enjoyed. This is novel. So it is these five issues where we think we are apart. Having said that, this is not the Grand Canyon that we are apart. It is not even the Murray. I do not know enough rivers up here or creeks. Why I think we are still having this dispute is, and without perhaps travelling all the way to Canberra to describe it, we do not believe that the Federal government's contribution has been well considered.

PN940

The comments by Tony Abbott to call a group of workers taking legally protected industrial action traitors, that is a significant step forward in the Oxford English dictionary. This is legally protected action under the laws which they themselves passed. So it very conceivably opens the criteria that if you follow the laws which the Federal government pass, you too could be deemed a traitor. In fact, the only other point I would make on this is that the AWU does not view the Tristar as Abbott's traitors but rather Howard's battlers trying to seek security.

PN941

We believe this could have been resolved and we believe the Federal government's comments are - they are not mediating. Our view is that the role of the government is to mediate. The role of the government is not to put on the footy jumper of one team, rush down onto the field and try and grab the ball and carry it up where the company cannot. We also believe that why we are here is that there is a legitimate concern about employee entitlements. I think this is something the Australian Industry Group and some commentators have failed to realise. One Tel, HIH, any number of closures in the metal industry, the textile industry, the building industry, has meant that as inevitably happens in history, times come where arguments come of age.

PN942

Now, I accept that the debate has become polarised between on one hand do nothing about security of entitlements and on the other, if you like, you know, you must take all $17 million of a company's entitlements and put it overnight into a particular fund. In the absence of an intelligent informed response from the employers it is easy to see why putting everything into one account is not such an unreasonable proposition because there is no other agenda. We do not believe that the employers or the government or those who are interested in cooperative industrial relations do themselves a favour by simply denying the argument exists about employee entitlements.

PN943

It is not enough as the company and the AI group offered last night to say: we will have a talk three months before the end of this agreement. The genie is out of the bottle, and simply trying to pretend that it is not there does not assist the debate. We do, however, recognise that there are elements within the Tristar company who are at least trying to get their head around the debate, what is the best way to secure entitlements. The best characterisation of the dispute where we are at now and the reason why we think it is still capable of conciliation is people of good will are concerned that there is this disruption.

PN944

Our members do not want to disrupt anyone. Our members do not even want to be on strike at one level and lose money. They are not getting paid. On the other hand, for people who do not earn a lot of money, for whom taking industrial action - this is the longest strike this company has had. For them to do something so significant at cost to themselves shows there is a genuine concern out there which has to be addressed. So therefore we think that at least at the Tristar level, if not at the level of public policy, there is an acceptance that something needs to be seen to be done on employee entitlements.

PN945

The insurance bond itself with the remarkable lack of detail is insufficient. Whilst I do think over the weekend steps were made by the AI group and the company to put in place some of the details, I do think that the compromises by the unions about saying: if it is not Manusafe, if you have some sort of bogy man attitude towards that, let us look at a joint bipartisan approach of employer and employee to set up some form of future basis for accruing long-service leave. Well, we think that probably was sensible. The other reason why we think this dispute is where it is at is we think the company still has a misunderstanding about enterprise bargaining.

PN946

This is not a system which the union movement actively sought to insert into industrial relations but it is the system we operate under. The company said - and I thought this was as revealing as earlier comments by Mr Cameron that it is the workers' money. The company said: why should we put any of our money in another account? It is a fair question but there is a fair answer. In enterprise bargaining if a membership strongly advance a claim and strongly believe it and it is pertaining to the employment relationship it is not objectionable. It is an appropriate issue to talk about.

PN947

If the work-force have a sufficient concern and then they come up with such a remarkable compromise of $150,000 roughly per year, well, I just wonder if the principle is beginning to outweigh the pragmatism, the commercial reality of what we are trying to seek. The final point about why I think we are at the dispute we are at - and I actually do not want Mr Abbott anywhere near this dispute. I just wish he would perhaps take a media blackout, but other than that we do not want him, because all he will do is become like an overzealous footy fan running around the field.

PN948

What we do think is that Bob Herbert should be here. He has had a fair bit to say. We do think that the CEO of Tristar should be here. The unions are taking this seriously. The senior national leadership of the two largest unions on the site are here. This is a dispute, allegedly, and probably it is, affecting thousands of people. It is not appropriate and it is disrespectful, in our opinion, to the enterprise bargaining process to have people available at some length by telephone and the only way we can commune with them is watching them on the channel 9 news.

PN949

So that is why we think we are where we are. We do believe that we are not far apart. Where we would say we go from here is the issue here is the labour hire, the part 2 employees, the 5 per cent pay per annum, the partnership of insurance bond and trust fund. We see the key differential is the quantum. If the company can accept that it has to put - we do not believe and no serious accountant would tell us that if you have a corporate turnover of $25,000,000 a year, that $150,000 a year in a trust account which also comes off your liabilities, this is not a big challenge by Australian accounting standards.

PN950

The unions were prepared - and it was at our initiative that we met yesterday and we did meet for 12 hours. Everyone knows this is pretty important. Everyone will have a pretty red hot go and I am sure the company will. If there is a bona fide problem with some sort of joint trust account, industrial solutions do involve compromise. The insurance bond on its own raises concerns, and rather than rush in some higgledy piggledy fashion, if we can get the principles of some sort of joint approach between work-force and company I think the rest of Australia will be grateful.

PN951

I think the rest of Australia is probably a bit bored with the detail of what is the Holy Grail of securing entitlements. We think that this would be a positive step forward. In conclusion, to quote Mr Norrington of the Sydney Morning Herald, as he was quoted once before today, there is a whiff of compromise. We have a concern that by terminating the bargaining period and looking for legal options that that will turn into the stench of battle. We think that this Commission and its facilities will be appropriate to go on tonight.

PN952

THE COMMISSIONER: Yes. Thank you, Mr Shorten. To probably use your analogy of letting the genie out of the bottle, I wonder if the parties really have considered what happens if the genie is out of the bottle and then arbitration occurs. Mr Murphy?

PN953

MR MURPHY: Thank you, Commissioner. Commissioner, most of the detail, in fact all of the detail required for a report back has been presented to you by Mr Cameron and Mr Shorten. However, there were a couple of points that I wanted to make in relation to where we stand today. Commissioner, you should be in no doubt, as I am sure you are not, that the issue is the protection of employees' entitlements. Particularly, Commissioner, it is I think the protection of money that people have already earned.

PN954

The issues of HIH, One Tel, Steel Tank and Pipe, National Textiles were all dealt with retrospectively, always done retrospectively. They were dealt with industrially and judicially. It is on that point, dealing with it judicially, and noting that this Tribunal's function is conciliation and arbitration, that this Tribunal has the ability, has the capacity to fix this problem prospectively. That is why we have the simple exercise of that conciliation and arbitration function, particularly the first one.

PN955

Commissioner, our submissions last week I believe were correct, still believe they are correct. The CEPU urges you, as the other two advocates have mentioned, not to terminate the bargaining period. We are open to further conciliation and we demonstrated that last night and into the early hours of this morning. Commissioner, I do not speak from behind the armoured veil of Parliamentary privilege, but I will say this. The bandying about of terms such as economic treason in relation to people who are fighting for their entitlements that they have already earned, well, people of a rational mind can make their own assessments as to the validity of those comments. Commissioner, I want to keep the submissions brief because I am absolutely dying to hear the responses from the employer.

PN956

THE COMMISSIONER: I thought you wanted to go home.

PN957

MR MURPHY: Because, Commissioner, after the 17 hours that Mr Cameron referred to of negotiations over the past few days and the recalcitrant attitude in relation to these employees' entitlements, I really want to see them demonstrate and actually prove in front of the Australian public how they can actually refuse to give us information how they are going to protect our members' entitlements. I will leave my comments to that, Commissioner.

PN958

THE COMMISSIONER: Yes. Yes, Mr Oliver.

PN959

MR OLIVER: Mr Commissioner, I might just want to pick up on a number of points that Mr Cameron alluded to regarding some of the finer details of the issues that the company raised regarding the question of their concerns with the trust fund. What is absolutely clear is that the nub of this whole dispute is the question of employee entitlements. On one hand we have got the company offering solutions saying: the perfect solution to provide 100 per cent security of employee entitlements is through an insurance bond. Our position, as you know, Mr Commissioner, was: well, our position is the best way to protect employee entitlements 100 per cent is to set that money aside into trust and that trust would have been Manusafe.

PN960

Mr Shorten has pointed out that as part of the negotiations and in the spirit and compromise and in the spirit of trying to move forward we were prepared to look at accommodation of both models. It seemed to be the case yesterday that when we sat down in good faith, in good faith - and that seems something that has been lacking on the other side through this process - in good faith we said to the company: yes, we are prepared to look at the option of the insurance bond, but of course we need to be satisfied on a number of those fundamental principles, because a fundamental principle is, one, who the insurer is going to be and those other details that Mr Cameron has outlined, and I do not intend on going over.

PN961

We said we would actually look at that and seriously consider it but on the basis that they would seriously consider the option of Manusafe and the option of a trust fund. When we got to the point of negotiation around the trust fund we got to the same old stonewalling that we have had throughout the history of this dispute and that is, no, no, not interested. Now, I have been involved for a number of years in looking at the whole notion of trust funds. I have personally been involved in playing a major role in establishing Manusafe in conjunction with the other manufacturing unions which all of them are sitting at this table and in addition a number of others that are not here today.

PN962

I asked the company specifically, I asked Vincent Kong: what is your concern with Manusafe? What are the specific details? Basically I could not get any concise answers, but after some further deliberations there was a preparedness from the AIG and the company to actually put on the table what their concerns were. As Mr Cameron pointed out, they came down with four fundamental ones. First there was the question of the administration problems, and it was clear that the company was unfamiliar with the way that the fund would have been operating and there is plenty of information around which the company has which indicates in regards to administration process.

PN963

We explained to the company quite late last night the administration process has minimal impact on the company, that the administrators who are backing Manusafe, which are ING - and as you can appreciate, they are well known and a very substantial organisation. We indicated to the company that ING have invested almost $1,000,000 in setting up the computer and software systems for that very reason, to have minimal impact on the administration processes of the company. We explained to them the way the administration would work. It would be B to B, that once an amount was struck, for example, as Mr Shorten pointed out, that the solution we were moving towards was to say 1.5 per cent payment for a long-service leave accrual in the future.

PN964

We explained to the company that automatically ING in conjunction with the officers of the relevant factories have set up the software where that administration process would be minimal. First we addressed that. The second issue was the company had expressed concern regarding the additional cost. Now, if you look at the existing long-service leave accrual for employees, on average they are around 1.65 or 2 per cent of an employee's salary. What we are after is a down payment, a down payment towards that entitlement. Not the full amount but a down payment of 1.5 per cent.

PN965

Now, it is arguable, the company can argue, well, because we are getting access to that entitlement before a qualifying period there may be an additional cost, and we accept that, we always have and we have never shied away. I refute the comments from Bob Herbert through the media that our scheme is a sham and we are trying to hoodwink our members. I totally refute that. We have made it clear from day one through the pursuit of our fund we are after protection and portability. We accept there is an additional cost for the portability.

PN966

We took the company through it in some detail last night. In the case of Tristar we understand that they have a history of 90 per cent of their work-force stay with them to such a time that they have a qualifying period and receive long-service leave after seven years. So the additional cost of 1.5 per cent to the company would actually be 10 per cent of that, because it would only have applied to 10 per cent of the work-force, hence, an additional cost to their wages bill of .15 per cent which we said we were prepared to offset against our wage increase.

PN967

The company came back, unacceptable. The other compromise position that we made was to simply say: okay, the concern is the employers have indicated why should employees who do not stay for a qualifying period get access to a new entitlement? On the basis of trying to move this dispute further we put up another proposition to say that we will reach agreement that for the life of this agreement we set aside accruals for employees who are eligible for a long-service leave entitlement at the moment, and that would have been 1.5 per cent over the two-year period and we estimated the cost of that would have been in the vicinity of $300,000 over the life of the agreement, two years, $150,000 per annum and that may well be the only major thing that is standing in regards to reaching agreement on this very important issue of security of workers' entitlements.

PN968

The employers then raised the issue of cash flow, the impact of cash flow. As we have said, we are not after 20 per cent or 19 per cent, some of the figures that have been pronounced and promoted by the AIG in a lot of their material that they have put around. We are after 1.5 per cent. I have to say, Commissioner, if an employer tells me that 1.5 per cent is going to be a major impact on their cash flow, I would have to say that is even a stronger argument for our position of securing employee entitlements. It is 1.5 per cent.

PN969

The other concern they have raised - and this is where the AIGs main concern and main driving force in opposing our scheme comes out. They believe that a long-term agenda is, well, let us get 1.5 per cent now and in the future we are going to crank it up to 3, to 5, to 19 and 20 per cent. We accept this is part of the system we operate in. The claim that is on the company now is 1.5 per cent and it will be locked up for the life of the agreement which would be two years. It cannot be varied, it cannot be increased through the life of the agreement.

PN970

The fourth and final point the company raised was in respect of concerns they had over taxation. I must say, as I said, for three years we have been looking at putting this fund together. We have not rushed into this. We have not rushed into it. It has only been April this year that the trustees had agreed on the appropriate administrator being ING to administer the fund. In that three-year period we had nothing but rhetoric, uninformed material going out by the AIG against the fund, not based on any factual stuff but just based on the hysteria of whipping up this notion that the unions are now coming after employers to try and take away cash flow in the vicinity of 19 or 20 per cent.

PN971

Not once have we had a round table discussion with the AIG and ourselves up until last night. So it took a dispute of this magnitude to get the AIG across the table and to start putting on the table what their genuine concerns are regarding our scheme. Up until now it has been a debate that has been fought over the internet, over the radio and through propaganda. So finally, on the question of taxation again, they raise concerns saying, well, their advice seems to be that their current concession that they receive for employers on paying long-service leave will be gone. I indicated to them that we had advice and I could quickly get that in writing which I have presented today.

PN972

Now, the history of Manusafe and the history of this debate of employee entitlements, the AIG have been consistent on one thing. They have consistently put up arguments and we have consistently knocked them down, and quite frankly, they are running out of arguments. Again, as I have demonstrated, the arguments that they have put up I will put that we have adequately addressed those concerns that they raised last night. I will seriously support the earlier submissions about we are not far apart. We are not far apart and I am happy to address any other concerns that the AIG or the employer themselves may wish to raise in regards the setting aside of entitlements into a trust fund during any further conciliation process.

PN973

THE COMMISSIONER: Yes. Mr Higgins. We do not want five people from every union. Mr Wallace, I have asked for a report back on the meeting and I think I have got the trend.

PN974

MR WALLACE: Commissioner, I am not standing up to report back. I faxed to your office earlier on an application of 111(1)(t).

PN975

THE COMMISSIONER: Yes.

PN976

MR WALLACE: I thought it would be convenient for both the parties and for yourself if Mr Higgins responds to that at the same time. So I would like to formally tender that application.

PN977

THE COMMISSIONER: Yes.

PN978

MR WALLACE: And at the same time to tender the latest financial statements of the company that have been put into the Australian Securities Commission.

PN979

THE COMMISSIONER: Yes, thank you, Mr Wallace.

PN980

MR WALLACE: Sorry, just to assist. Mr Higgins might like to respond as to whether or not that 111(1)(t) application is opposed or not, but I just draw your attention to the fifth page of the financial statements which shows that as at January 2000 Tristar was $16,000,000 in the red.

PN981

THE COMMISSIONER: Yes.

PN982

MR WALLACE: Hence the concerns of the workers.

PN983

THE COMMISSIONER: Yes, thank you, Mr Wallace. I apologise for not understanding what you were going to do.

PN984

MR WALLACE: You are forgiven, Commissioner.

PN985

THE COMMISSIONER: Yes, maybe, for how long? Yes.

PN986

MR CAMERON: We have had a long day too, Commissioner.

PN987

THE COMMISSIONER: It has not finished yet.

PN988

MR HIGGINS: Commissioner, I cannot respond to this document which was just handed to me 15 second ago, of course, Commissioner. My understanding of today is it is to report back to you as to what the position is as of now and that the purpose was not for a series of new submissions. I do have some concerns about that document being handed up at this stage. Can I indicate, Commissioner, that as was said, there was a meeting on Friday. The company suggested that there should be a further meeting on the weekend which the unions readily agreed to. There was a very lengthy meeting yesterday which I understand concluded at about 1.30 this morning.

PN989

As a result of negotiations which commenced in May, there is a proposal from the company which deals with a number of areas. It deals with access to long-service leave after seven years of employment. It deals with pay-out of sick leave on retirement, out-placement service on redundancy, paid meetings, various other conditions, but also it includes the insurance bond and you have heard quite a bit said about that today. There was an insurance bond previously in place and what is proposed by the company is that there be another bond which will address the issue of employment security of entitlements.

PN990

As part of that the company has proposed to improve the current arrangement. It has offered to pay the premium on the insurance bond for the full period of the enterprise agreement up front. It is said that the offer ensures that employees will be paid their entitlement immediately in the very unlikely event of insolvency - and there is no evidence of insolvency facing the company at the moment - the removal of a clause which was referred to today regarding the bond being cancelled if industrial action was taken. That is not going to be the case, Commissioner, and only reputable insurance underwriters are being considered.

PN991

Now, it is put, well, who will be the insurer? What the company is doing is it is seeking four quotations. Having received quotations it will examine both the product and the credit rating of each company. It will then have discussions with the trade unions about which would be the appropriate insurance company and bond to establish. The great difficulty is, Commissioner, that there is certainly an issue between the parties which certainly would have manifested itself in this hearing and certainly today concerning Manusafe or a trust fund. The parties are simply unable to reach agreement on that matter.

PN992

It is not that the company has dragged the chain. It can be seen that the company has made various offers and offered various improvements, but on that matter the parties simply cannot agree. The industrial action has therefore been continuing and the position currently at Holden is that in Elizabeth 4000 employees today are affected. I understand that at Fishermans Bend in Victoria 150 employees are affected. At Ford 1000 employees have been stood down without pay today and at Geelong tomorrow it is expected that 2000 employees will be stood down without pay and, of course, at Ford the evidence of Ms Ronaldson was that there is a three-day leave time. So if work resumes today it would be three days before product would flow at Ford.

PN993

We reject suggestions that the company has not been approaching this with senior management. Vincent Kong is the General Manager of Tristar and he has had assistance from David Hargraves of AIG. More recently Mr Smith on the weekend became involved and he is the most senior Industrial Relations manager at Australian Industry Group. Mr Cameron gave what was at times a quite colourful submission, certainly at times vitriolic and various derogatory remarks were made. I do not see it as appropriate for the purposes of today to deal with those. I do not think that will assist the Commission.

PN994

I would think that Mr Cameron's submission would not give any encouragement to the Commission that the parties were able to deal with these matters through direct negotiations. If you proceed to terminate the bargaining period there will be conciliation, indeed, there must be conciliation pursuant to the Act. If no agreement is reached on certain issues then there can be arbitration. That would seem in the context of this dispute to commend termination of the bargaining period. If it please the Commission I have nothing to add.

PN995

THE COMMISSIONER: Yes. Thank you, Mr Higgins. This matter was listed today for me to hand down my decision on the matter which I heard last Wednesday and Thursday, that is, to terminate the bargaining periods of the unions. I should I suppose make a statement before I go on to read what I have got to read to the parties, that this Commission has never accused the workers at Tristar of taking any industrial action that is against the law.

PN996

The workers at Tristar have always conducted themselves in accordance with the Act and the Commission makes no judgment or comment condemning those people, for they have complied with the Workplace Relations Act 1996 as it is written. So the Commission makes no comment as to what has been said in newspapers by other people. The Commission simply says that these people have conducted themselves properly and that should be on the public record. I propose to make the following statement.

PN997

For reasons beyond the control of the Commission I have not been able to formally write a decision in this matter. Reasons for my decision will be published and supplied to the parties as soon as practicable. In this application by Tristar Steering and Suspension Australia Pty Limited, pursuant to section 170MW of the Workplace Relations Act, Tristar seeks an order terminating the bargaining period which has been commenced by the AMWU, the AWU, the CEPU and the NUW. I have taken into account all the evidence that has been put before me in this matter.

PN998

The termination of the bargaining period. The Act provides at section 170MW3 that the bargaining period can be terminated in the circumstances where, to endanger the life, the personal safety, the health or the welfare of the population or part thereof. I have considered the submissions made to me in this matter and I have formed the view that Tristar has failed to meet the test required by the Commission in this section of the Act and therefore I refuse to terminate the bargaining period on those grounds.

PN999

The application was also made on the basis of section 170MWB, that the bargaining period can be terminated in the circumstances where, to cause significant damage to the Australian economy or an important part of it. I have taken this into account. I note that a large number of employees have been stood down in the vehicle industry. I accept that more will occur in the following days. On this ground I accept the arguments of Mr Higgins, that this will cause significant damage to an important part of the Australian economy and I have decided to terminate the bargaining period.

PN1000

An order in print number PR907393 will terminate the bargaining period from 3 pm on Tuesday, 7 August, 2001. In accordance with section 170MX2 of the Act the Commission is required to conciliate this matter as soon as practicable. I propose to do so now. The Commission stands adjourned.

OFF THE RECORD

NO FURTHER PROCEEDINGS RECORDED [4.50pm]