C2001/4719, Transcript of Proceedings [2001] AIRCTrans 2492 (1 October 2001)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 4, 179 Queen St MELBOURNE Vic 3000
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TRANSCRIPT OF PROCEEDINGS


O/N 0128
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER JONES

C2001/4719

BRAMBLES AUSTRALIA LIMITED

and

TRANSPORT WORKERS' UNION OF AUSTRALIA

Notification pursuant to section 99
of the Act of a dispute re subcontracting
out of a collection of hard waste

MELBOURNE

4.06 PM, THURSDAY, 6 SEPTEMBER 2001

PN1

THE COMMISSIONER: May I have the appearances, please?

PN2

MS D. HOLLYOAK: I appear on behalf of Brambles Australia Limited trading as Cleanaway. I also have with me, Commissioner, at the Bar table, MR D. CROOKS, who is the Melbourne branch manager. And I also have MR J. AGOSTINO, who is the operation manager for Cleanaway Bayswater.

PN3

THE COMMISSIONER: Thanks very much, Ms Hollyoak.

PN4

MR M. FAWKNER: With me I have MR M. LEVER and MR P. THORNE, Phil Thorne being a delegate and Malcolm Lever being the assistant delegate of the - - -

PN5

THE COMMISSIONER: Thank you, Mr Fawkner. Mr Hollyoak?

PN6

MS HOLLYOAK: Thank you, Commissioner. Commissioner, the purpose for notifying the dispute in relation to this issue was that the company were seeking to rely on the settlements of disputes procedure within the Cleanaway Knox Collection Agreement 1999, which was certified on 29 August 2000. The agreement still is in place, Commissioner. It ceases to exist 30 September this year. To that end, Commissioner, the dispute, as indicated on the dispute notification, relates to the company subcontracting out one of its runs.

PN7

The arrangement of subcontracting one of its runs relating to hard waste commenced only Monday this week. The discussion in relation to subcontracting that particular run did take place, or did commence six weeks ago. That involved the Operations Manager and all of the employees relating to this particular contract. I might - I might just make you aware, Commissioner, we are only talking about one contract, which is the City of Knox. Within the City of Knox contract you have a number of aspects to the waste collection. That involves collection of green waste, collection of hard waste, garbage and recycling.

PN8

The subcontracting arrangement that we put in place Monday this week is in relation to subcontracting of hard waste. The discussions that took place six weeks ago, as I say, included the Operations Manager speak to all the employees in relation to the company's intention to subcontract one of the runs. After that meeting the company became aware that there was a mass meeting for a discussion on that issue. We were advised after that meeting that in fact it was not a discussion but rather all the employees had voted on whether they approved of the company putting out this run to subcontracting.

PN9

When we spoke with the employees further I am led to believe that some of the concerns of the employees were that they thought it was going to result in loss of employment. The subcontracting arrangement has not led to any loss of employment for permanent employees. We did in fact have one full time employee on the job who has been allocated to another permanent job. And two labour agencies, as I understand it, are no longer required as a result of this subcontracting arrangement. The person of whom - is subcontracting to the company has in fact been subcontracting to Cleanaway for quite some time, I think a couple of years. Due to the concerns that the employees raised with the management of Cleanaway about this subcontracting arrangement, Mr Crooks put a letter to the employees indicating that no full time employees would be replaced by subcontractors during the terms of the contract.

PN10

And the term of the contract is four years remaining on it. It was our understanding, Commissioner, that the issue was resolved. However, that became - it became apparent Tuesday this week that it was not resolved. We were advised that if we did not cease the arrangement with the subcontractor and go back to the status quo that we would incur industrial action by all the employees. It is on that basis, Commissioner, that we have notified a dispute under section 10F of the Cleanaway Knox agreement.

PN11

And essentially what we are seeking this afternoon, Commissioner, from yourself would be possibly some conciliation in relation to the matter. And certainly an undertaking on behalf of the employees that there would be no further industrial action. The position of the company is very clear. We believe that we have fulfilled all of our requirements in respect to consultation of the employees. It hasn't resulted in any loss of full time employees. The reason as to why that particular run was contracted out was because of the losses that we were incurring on that particular contract.

PN12

And by our subcontracting that particular run out we are now only in a position to break even with that particular aspect of the contract. And it is obviously our intention to continue with the subcontract arrangement. Obviously the company is in a position where we have entered into a subcontract arrangement with the employee - sorry, with the subcontractor, and obviously we have had to cease that arrangement and obviously we are wanting the ability to indicate to the subcontractor that he can continue his work, tomorrow as per the contract that we have entered into with him.

PN13

So that is essentially the outline of the dispute before you, Commissioner, from the company's perspective.

PN14

THE COMMISSIONER: Okay. Thanks. Mr Fawkner.

PN15

MR FAWKNER: Well the one problem we have got with the company is we haven't stopped the subcontractor doing work to - to keep his workers employed, so that doesn't affect his boys at all. There is two young guys involved there. They are still doing work for the company. We have allowed that. But the biggest problem we have got it during the discussions of the EBA back in August - before August '99, actually - it was actually 29 August, was that the workers were very scared that there may be - subcontractors would be brought in. And they asked Mr Crooks during the EBA talks, in fact on the day of the vote, whether the company would introduce subcontractors. And they were given verbal assurance that no subcontractors would be brought in for the life of the contract. And then, at another meeting on 4 October '99, the meeting between the employees again, the question was asked by the fellows, in fact by Mr Malcolm Lever. First off was:

PN16

Will there be any more subbies?

PN17

And David Crooks replied:

PN18

As far as I am concerned any company that has to get subcontractors to do their work is not operating their business efficiently, and as far as I am concerned, while I am in charge there will not be any subcontractors operating in the City of Knox.

PN19

And then there was other discussions which David Crooks stated:

PN20

Will you be using subcontractors in the next contract? It is not Brambles policy to use subcontractors, and we have no intention of using subcontractors.

PN21

And present were Mr David Crooks and Phil Thorne. And then at the later hearing there was Mr Crooks, Phil Thorne, and Mr Privitera that works for the company as well. So what we are saying is the company has verbally broken an agreement with the drivers and the runners that they would bring subcontractors in for the life of that contract, Commissioner.

PN22

THE COMMISSIONER: That says it all. Ms Hollyoak?

PN23

MS HOLLYOAK: Thank you, Commissioner. Commissioner, whilst the company accepts the fact that there was some discussion in relation to the company's intention as far as some contractors are concerned, obviously with this issue arising I have had extensive discussion with Mr Crooks. I am led to believe that the discussion that took place with Mr Lever and for which Mike Fawkner has just referenced, was that Mr Crooks indicated that the preference was to use employees rather than subcontractor. And there was in fact at the time, which is August '99, a briefing paper which was put out.

PN24

And it was very clearly indicated to the - and communicated to the employees that Cleanaway did tender the Knox contract on the basis that it was our preference to use employees and not subcontractors. However, the company is in a situation where, due to the financials of one particular run, we have to subcontract the arrangement out, otherwise we are ceasing to be able to supply the principal contractor with our obligations under the Knox contract. To that end, that is why we have entered into a subcontractor arrangement and my position in relation to this issue is that we have communicated and consulted the union quite extensively in relation to this issue.

PN25

And we have clearly indicated that the ramifications for the employees is that it has not replaced any employees' employment. And that in fact it has just merely put in another person of whom - the one person who is currently doing the subcontracting arrangement was already a subcontractor to us. He was a subcontractor on the Lilydale contract I am led to believe, and has now transferred across on to this particular contract. So it is my understanding that what we are introducing is nothing new. We also have another subcontractor who does the delivery of containers, and also bin work, and that arrangement has been in place after the actual commencement of this Knox contract.

PN26

So I don't quite understand why the issue has been brought up now, especially when, as I understand it, the main concern would be loss of - a loss of jobs, and that hasn't resulted.

PN27

THE COMMISSIONER: Thank you. What the union seems to be saying is - to me anyway is that statement made surrounding this issue of contractors being used or not is a little bit stronger than what you are saying. Now I am not saying who is right or wrong. You seem to be saying that - the emphasis that they have placed on as a result of what has been said to them was that there would be a blanket no contracting situation or subcontracting situation until the life of the agreement. Now, whilst there may be no job losses occurring as a result of what has happened here, it seems to me that the drivers - some of the drivers at least are concerned that okay, if that alleged promise was correct at the beginning, how can we say with any assurances that this is going to occur during the life of the agreement.

PN28

That we are going to protect them. Whilst recognising that it may no be affecting them now, how are we going to guarantee that?

PN29

MS HOLLYOAK: I believe, Commissioner, that we have already done that. When the - as I indicated earlier, when the employees raised their concern - - -

PN30

THE COMMISSIONER: Well, you - excuse me for interrupting. You may have done it, you may have believed you have done that.

PN31

MS HOLLYOAK: Yes.

PN32

THE COMMISSIONER: But what is resulting from the other end does suggest that it has been .....

PN33

MS HOLLYOAK: Commissioner, I am happy to put on record that the indication or the undertaking that was given by Mr Crooks to the employees by way of a letter. I am happy to do that on transcript for the purposes of today, whereby no full time employees will be replaced by subcontractors during the term of this contract. I am happy to put that on the transcript. However, obviously what the company will not do and as I indicated, the reference to what Mr Crooks believes he said 18 months ago, was that the preference was to use employees rather than subcontractors. Mr Crooks has been in this line of industry for 27 years, and I think it fair to say that he would not have given any undertaking stronger than that because we all know that you can not anticipate how the operations change from one day to the next to give an undertaking that you won't go with one particular formal business undertaking.

PN34

THE COMMISSIONER: Well I accept that in this day and age it is a rather rash promise to make, if it was made. Because I - I just see it time and time again that circumstances change. So promises don't necessarily - or can't necessarily be kept because of the way the businesses drop off or that is how it goes out there. Unfortunately we are all affected by it, even in fundamentals such as this, what is occurring out there. But, you know, you have got an assurance in writing. Is that what you have got? It is written down?

PN35

MR FAWKNER: Well, Commissioner, I think the company has already answered a few of the questions that you have just asked there and that is that they have brought in another subcontractor to do bins, after the EBA was signed over. Now the fellows are saying, well hang on. If we let that subcontractor come in - - -

PN36

THE COMMISSIONER: Yes, I know what you are saying.

PN37

MR FAWKNER: Down the track we get another one, this is just going to keep going.

PN38

THE COMMISSIONER: Yes. Well that is - - -

PN39

MR FAWKNER: And one of the questions I would ask the company is, the only reason there is no loss of jobs is because they have had to put another two trucks in runs because of a growth in the contract. That is the only reason. And what I would be saying to the company is, well if that growth hadn't come and they didn't have to get those other two trucks in, which gave those two drivers - or those two people extra work, or other work, sorry, alternative work, what would we be doing now? I mean, we would be saying job losses, if that hadn't happened.

PN40

MS HOLLYOAK: Commissioner, in respect to Mr Fawkner's concerns. Yes, quite correct in that we have had to put on extra vehicles. However in relation to his claim, and I think it was more in response to my claim that we have had two subcontractors put on during the - sorry. One subcontractor put on during the term of this contract. That work was never done by the company. It has never been done by the company at all.

PN41

THE COMMISSIONER: In this contract.

PN42

MS HOLLYOAK: Sorry, in this contract. So I don't think we have already breached the arrangement so that - in relation to Mr Fawkner's concerns. But certainly, as I have indicated we are happy to give an undertaking to the best that we think we can give an undertaking, is that we won't replace any full time employees with subcontractors. And obviously in relation to if this issue arises, I think it fair to say that we would continue what we have done in the past, which is have a consultation with the union organiser as well as the union delegates, as per the disputes procedure. So I think it fair to say that the union and the employees can be - rest assured that the company is not going to be doing this without consultation, like it has never done it before.

PN43

THE COMMISSIONER: Well given that I have got to accept that circumstances do change. They are just evolving so fast in some areas it is just impossible for people working in there to control the situations, as we all know. But given the circumstances that exist out there, what Ms Hollyoak is saying to us now is that except for the union, you have got something in mind which you mightn't have known about before.

PN44

MR FAWKNER: Commissioner, a few things that worry me in this, and that is that the company has assured us from day one there would be no subcontractors to get the EBA voted on. Because at that stage there was some very big concerns about subcontractors. The fellows agreed to the EBA on the fact that the company gave them assurances no subbies would be coming in. They have now changed from a job and finish criteria in the respect that before they used to start and as soon as they finished their map, which is their area, they would go home.

PN45

Now they have moved from that area to what they call a fixed hourly run, and that means they could do an eight hour run, or a ten hour run. Some of them are doing 12 hours.

PN46

THE COMMISSIONER: What? As part of the EBA?

PN47

MR FAWKNER: Yes.

PN48

THE COMMISSIONER: Well, yes. Okay. That's the agreement you reached, that both of you reached.

PN49

MR FAWKNER: That's right. But I mean, they have worked hard to keep their jobs because the company kept stressing to them that if they didn't work this way they wouldn't have a job. Now they feel that because this has happened that sooner or later they are going to be told in discussions - in consultation, that look, sorry. The green is not viable. We are going to have to subby that out too. And what another problem is the drivers are having, and the runners, is if Cleanaway, the company it is with the buying power it has, cannot run that contract viably and without loss, how come they are able to subcontract it out with the same amount of people? Two runners, running behind the truck. And yet it is cheaper than running their own truck.

PN50

THE COMMISSIONER: Well - - -

PN51

MR FAWKNER: Because the subcontractor has to pay for his truck.

PN52

THE COMMISSIONER: There can be a lot of factors in that, Mr Fawkner, I think you would be aware of one of those right here.

PN53

MR FAWKNER: I realise that.

PN54

THE COMMISSIONER: There are a lot of factors of why a subby can do things cheaper than a major contractor, if you like.

PN55

MR FAWKNER: Well one of the things that probably you would be looking at as to - - -

PN56

THE COMMISSIONER: They haven't got the overheads for a start, probably.

PN57

MR FAWKNER: Yes. And one of the things that worries us is the workers on that job are not being paid by the current EBA that sits on that contract.

PN58

THE COMMISSIONER: Well that is a matter for you take up elsewhere, isn't it?

PN59

MR FAWKNER: That is right. I know that, Commissioner.

PN60

THE COMMISSIONER: It is not Brambles fault and it is not your fault, nor is it the drivers' fault by the sound of it. It sounds as if something has to be done to make certain that occurs with subbies.

PN61

MR FAWKNER: Well, why we are in dispute is when we were having discussions with the - in a consultative way, it was agreed that a letter would go out to go on a noticeboard for the fellows to be assured that there would be no more subcontractors coming into contracts. We had that last meeting on 23 August - I will just make sure - on 23 August and it never was handed out to be put up on noticeboard until Friday 31st to tell the guys that on the following Monday the subcontractors were coming in. At that stage we still were in discussions as far as we are concerned. We want the letter to go out for the guys to then have another meeting to discuss whether they would accept that.

PN62

THE COMMISSIONER: So what you are saying would be the actions or the inactions, if you like, appear to be possible, deliberate.

PN63

MR FAWKNER: Well I found it was sneaky, Commissioner, because it never came out until the Friday after they had all gone home from work.

PN64

MS HOLLYOAK: Commissioner, given a lot of what Mr Fawkner has just raised is in relation to the previous enterprise agreement discussions, given that I wasn't present, are you happy for Mr Crooks to respond in relation to those?

PN65

THE COMMISSIONER: Yes, yes.

PN66

MS HOLLYOAK: Yes, thank you, Mr Crooks.

PN67

MR CROOKS: Sorry, Commissioner. Just from my point of view, there is a couple of interpretations about what took place. Back in '99 when this contract was actually let, the question of reference to subcontractors was in relevance to what was happening within this industry and what was happening with regards to our opposition who were utilising subcontractors with a view to get reduced prices doing work. Now this contract was in jeopardy of being lost because of those types of implications. Now, at the time that I was asked, the reference was more to the garbage collection, the recycling collection and the solo vehicles where subcontracts were required to put their own capital in and that was the reference that it was made to.

PN68

Now, I answered the question with a view to it wasn't my intentions and I certainly stick by that. It never has been my intentions. The intentions of this hard garbage collection was it is nearly three years ago that we started this contract. In three years, we are not completing the work and we are getting flack back from the council with regards to the waste has been left in the street. On numerous occasions, we have got to bring the subcontractor in to collection the waste that we cannot collect and it is a fact of life so this subcontractor has virtually worked for us more than 50 per cent of the time anyway to collect the same waste that we are talking about contracting to them now so what we are saying is that instead of doing 50 per cent or greater, we give them responsibility for the lot, that way we can start to control the contract rather than have this give or take.

PN69

With regards to what happened with a previous contract, it was completely different conditions and that was spelled out at the end of the previous contract and the people were given an opportunity to actually take redundancies or step into different positions of which job descriptions were spelled out and given to individuals and they were asked to apply so it was clearly spelled out that what the new contract was going to work and job and finish and was never a requirement of the new contract and it was clearly spelled out and accepted at that time and there was quite a number of employees who actually took redundancies at the end of the old contract and the old working conditions who then decided to go elsewhere. The people who stayed, stayed under the conditions and signed off with regards to their own job descriptions so those were all clearly spelled out.

PN70

I have got no intentions of re..... My preference is I don't like subcontractors. I will be honest, I will state it. My problem is that for three years we cannot fulfil the contract and we continue to lose money. It ain't working for us, it hasn't worked for us and I have tried for three years. I have got no alternative but to try and make the change because we can't continue to look. The problem is I have got a good garbage collection service, I have got a good recycle collection service and I have got a good group of workers but they see waste in the street and the council says Cleanaway doesn't do the job because the hard garbage is out there and it is physically seen. The fact is that I have one system of one truck which creates that philosophy. All I am trying to do is solve the problem. We are not making money out of it, we are not in it to make money but what we want to do is secure this contract for the next term. In four years time this goes to re-tender. I would like to think that Cleanaway can re-win it and these jobs and this work continues on.

PN71

We have had the Knox contract now for 17 years because our service is good. In the previous contract, we did this entire area with two trucks doing hard and green collection over five week periods. The current contract is 13 week periods so we cover less than 50 per cent of the same area. It was a fair assumption that we could do it with one vehicle when we were considered. Previously, the jobs were being finished in five to six hours with two trucks doing two systems. Now we have got one system doing less than half the area and we cannot complete the work and we haven't been able to do it for three years. I didn't have much choice. Had the work been done, I would not have made the change.

PN72

THE COMMISSIONER: Well, it seemed to me - - -

PN73

MR CROOKS: Sorry, if I - sorry, your Honour.

PN74

THE COMMISSIONER: Yes.

PN75

MR CROOKS: It is just with regards to the letter. The letter - I was away and the letter was left at reception and the delegate came in and asked me. I told him I would do the letter. At the meeting I agreed to the letter and I made it quite clear that I would give them the letter so it was verbally told by me in front of the organiser and the delegate that I had agreed to the letter and that I would supply the letter. I missed the letter the next day. The following day I left it at reception and it was at the reception on the Wednesday afternoon. It was picked up on the Friday and I told Phil that I would leave it at reception and it was at the reception and Mike Fawkner rang me and I told Mike I had left it at the reception.

PN76

THE COMMISSIONER: Well it seems as if this message has somewhere along the line, certain personnel are being read one way when they should be read completely different but it seems to me that you have got an assurance from the company now that they are prepared to give you in writing which, even to some extent, would probably go further than what I can do in this day and age but the change will occur in the ..... Probably going to accept the fact that yes, you might have been suspicious with good cause and that is one of the things I am talking about, the actions of - certain actions causing problems have been read the wrong way and I think that might be the case on the basis that there was no intent or attempt to hid anything by what occurred with the notice going out on that Friday but, you know, that is something I think you are going to have to sort out yourselves.

PN77

Long term, I think you are both going to have to work together to ensure that you have got the contract continuing, if you like, in four years time. You know, I have had a couple of disputes recently in this area - not in this State, but in this area and it is basically how the company, through its drivers, receive work that is causing the problem. The contract has been let elsewhere and, you know, they have wrongly been perceived unless it has been affecting people who are responsible for tenders and something has to be done with you both working together to try and resolve that so that there is no misconceptions out there, what the company is on about, what the drivers are on about and ..... so you don't get the situation where employees are telling Knox Council or any other council saying that you are not doing your job because that reflects on you.

PN78

MS HOLLYOAK: Commissioner - - -

PN79

MR FAWKNER: If Ms Hollyoak doesn't mind, I wouldn't mind going into private discussions or private conference.

PN80

THE COMMISSIONER: Yes, by all means. Do you want me to sit in on it or do you want - - -

PN81

MR FAWKNER: Yes, please.

PN82

THE COMMISSIONER: Okay.

PN83

MS HOLLYOAK: I am happy to do that, Commissioner.

PN84

THE COMMISSIONER: We will go into private conference, then.

ADJOURNED INTO CONFERENCE [4.33pm]