AG2001/5371, Transcript of Proceedings [2001] AIRCTrans 2603 (3 October 2001)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 4, 60-70 Elizabeth St SYDNEY NSW 2000X1344 Sydney Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT KAUFMAN

AG2001/5371
AG2001/5372

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LK of the Act
by Lasercraft Australia Limited for the
certification of Lasercraft Australia Ltd
(Supported Employees) Workplace
Agreement 2001

SYDNEY

11.28 AM, THURSDAY, 13 SEPTEMBER 2001

PN1

THE SENIOR DEPUTY PRESIDENT: Good morning all, I'll take appearances please.

PN2

MR AMOS: Good morning, your Honour. I represent Lasercraft Australia, I act as an agent for them. With me I have MR JOHN LEDDY, a General Manager of Lasercraft Australia. MR MICHAEL TINNOCK, he is a worker rep and also PETER O'FARRELL, a worker rep also. Thank you.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Amos. I will give you leave to appear.

PN4

MR AMOS: Your Honour, I'm not quite sure whether you want me to deal with the determination of the designated award first or the certification of the agreement.

PN5

THE SENIOR DEPUTY PRESIDENT: I think if you deal with them one at a time perhaps with the determination of a designated award first then go on to the matter of the certified agreement.

PN6

MR AMOS: Thank you, your Honour. Your Honour, in matter 2001/5372 the determination of the designated award for the certification of this agreement, we maintain that the relevant award is the Australian Miscellaneous Workers Unions Support and Employees Business Services Award 1993. That award, although it indicates that it is a business service and a supported employee award, is mainly directed towards employees with disabilities that work in open employment situations, not in a situation similar to what we have here. So we are relying on that award to being the relevant award. I might add that I have used that award in a number of agreements that I have put in place in similar organisations and it has been accepted by the Commission as the relevant award.

PN7

THE SENIOR DEPUTY PRESIDENT: Can you give me an indication of what those are because I have a hesitation about that, the applicability of that award and there are some decisions of members of the Commission where they didn't designate the award be it certified an agreement? Quite frankly I'm not sure which way to go on this one, Mr Amos.

PN8

MR AMOS: As late as two weeks ago Senior Deputy President Drake nominated that award as the relevant award in the certification of Summerland House.

PN9

THE SENIOR DEPUTY PRESIDENT: Which one, sorry? What is the name of the agreement?

PN10

MR AMOS: Summerland House.

PN11

THE SENIOR DEPUTY PRESIDENT: Can you spell that for me please?

PN12

MR AMOS: S-U-M-M-E-R-L-A-N-D House.

PN13

THE SENIOR DEPUTY PRESIDENT: Yes.

PN14

MR AMOS: Supported Employees Certified Agreement 2001.

PN15

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN16

MR AMOS: There are a number of others. One prior to that would have been the Challenge Armidale Supported Employees Certified Agreement 2001 also. It might have been 2000, sorry.

PN17

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Amos.

PN18

MR AMOS: We maintain that that is an award that should be used for the no disadvantaged test comparison. It's an award that operates for people with a disability and also people without a disability working in the business services industry.

PN19

THE SENIOR DEPUTY PRESIDENT: Yes.

PN20

MR AMOS: I am aware of arguments against that award being used and I'm not convinced that the arguments were put by those organisations as the right argument. I am convinced that that award is the relevant award in all the circumstances.

PN21

THE SENIOR DEPUTY PRESIDENT: Yes, albeit as it applies, I think you said for people in open employment.

PN22

MR AMOS: It applies mainly for people that have commenced employment for want of a better word in a sheltered work shop situation but move into an open employment or into what they call an enclave situation where they go and work in a mainstream employment. But they need to be measured some way for a wage rate that is comparable to their productivity or their output - - -

PN23

THE SENIOR DEPUTY PRESIDENT: Yes.

PN24

MR AMOS: And that particular award utilises the supported wage system for the determination of wages.

PN25

THE SENIOR DEPUTY PRESIDENT: Yes, and it also has a fairly prescriptive manner of assessing what is the appropriate level of wage to pay.

PN26

MR AMOS: That certainly does. It actually covers a very broad range of types of work from clerical right through to general manufacturing. That is another reason why we utilise that award because the type of work that people are doing in this, certainly in this situation with this company Lasercraft Australia, the type of work is varied and they may move from different types of work on any one day or any week. It is very difficult to allocate a particular award that has particular classifications in it for these people.

PN27

THE SENIOR DEPUTY PRESIDENT: Yes, are you going at some stage to explain to me the nature of the employment of those at Lasercraft?

PN28

MR AMOS: Yes, I am, I will go through that in detail with the certification process.

PN29

THE SENIOR DEPUTY PRESIDENT: Yes.

PN30

MR AMOS: So having said that I might move straight on to the certification process and it will give you a bit of an idea of what this industry is about and certainly what Lasercraft Australia are about.

PN31

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN32

MR AMOS: Your Honour, this is an application under section 170LK for the certification of an agreement known as the Lasercraft Australia (Supported Employees) Workplace Agreement 2001. The relevant documents required by the Commission for making the agreement were forwarded to the Commission with the application. Those documents included the agreement document, we supplied four copies, signed by the parties bound by the agreement; the statutory declarations signed by Mr John Leddy, the General Manager of Lasercraft Australia; minutes of industrial agreement meetings 1 to 17 and Lasercraft Workplace Agreement 2001 training document. I am sure you have all those documents to hand.

PN33

THE SENIOR DEPUTY PRESIDENT: Yes, I think so.

PN34

MR AMOS: I will give you an overview of Lasercraft Australia. Lasercraft Australia is a non-profit organisation partially funded by the Department of Family and Community Service which is a Federal department and the commercial activities undertaken by the organisation. I might say at this point in time the people with a disability that work for Lasercraft Australia are heavily subsidised by the commercial activities of the organisation. In fact I would suggest that the wages paid to the people with a disability would only be half funded by the productivity output of these people so the organisation quite heavily funds the people with a disability.

PN35

It is acknowledged that Lasercraft Australia is an organisation that as a general rule does not operate pure employment service in the strictly commercial sense for people with a disability. The organisation operates in an employment like environment in which a range of additional support services are provided including vocationally related training, work experience and in some cases assistance to progression to open employment. Although it is highly unlikely that the employees at Lasercraft would move to open employment because of the types of disabilities they have.

PN36

THE SENIOR DEPUTY PRESIDENT: Yes.

PN37

MR AMOS: The primary relationship that exists between Lasercraft Australia and its employees with a disability extends beyond that which is generally expected in an employer/employee relationship. It is further acknowledged that this primary relationship will and does have a direct impact on the operational costs of the organisation and the services provided to people with a disability and furthermore, the terms and conditions of employment and wage rates contained in this agreement. So the wage rates in the agreement, the terms and conditions of employment are terms and conditions of employment that are very comparable and in some cases much better than people in open and general employment. Certainly the wage rates contained in the agreement are relative to the productivity output of the people and certainly the operational cost of the organisation.

PN38

The organisation employs both people with a disability and people without a disability. There are 21 people with a disability employed by the organisation and covered by this agreement. Of the 21 employees the majority have been assessed as medium to high dependent need employees. Medium to high dependent need means that they need a lot of supervision and in some cases it is the one on one supervision. The cost of providing such supervision cannot be adequately met by the department's funding and therefore must be subsidised by the commercial activities of the organisation.

PN39

In making the agreement the organisation took into consideration the Department of Family and Community Services content of a draft report formulated and compiled by KPMG and it was called the Business Service Review a joint initiative of Accrod, and Accrod are the industry body that represents organisations such as Lasercraft in matters affecting their funding and the operation of the organisation.

PN40

THE SENIOR DEPUTY PRESIDENT: Sir, before you go on, how many people without a disability are employed?

PN41

MR AMOS: There are 20 without a disability.

PN42

THE SENIOR DEPUTY PRESIDENT: In what capacities are those people employed?

PN43

MR AMOS: Well they're from clerical to graphic artists to people who work under a joint area award. I think then there's just production and sales.

PN44

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN45

MR AMOS: The joint initiative of Accrod in the Department of Community Services entitled "A Viable Future - Strategic Imperatives for Business Services."

PN46

The aim of the Business Service review was to identify strategies that will ensure the business services in the Disability Service industry are able to meet those requirements to continue to provide valuable and viable options for people with disabilities.

PN47

PN48

To understand the complexities and problem associated with the industry and employment of the people with a disability, one would need to read the entire content of the report. However, the executive summary contains the necessary information which would clarify the organisations position regarding wages and terms of conditions of employment.

PN49

PN50

The clarification would justify the Commission's requirements to certify the agreement in the public interest.

PN51

MR AMOS: I didn't bring a copy of that report. I have got a written copy of the executive summary and I am not quite sure whether you want me to read that on transcript, or whether you are willing to accept the document which I have prepared for the Commission and I am reading from now, which is my summary.

PN52

THE SENIOR DEPUTY PRESIDENT: Yes, I think it might be worthwhile if you read it on to the transcript.

PN53

MR AMOS: I will do that, your Honour.

PN54

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN55

MR AMOS: The executive summary;

PN56

For most individuals work is considered to be a major and essential way of gaining an income, increasing self esteem and enhancing quality of life. Over the past 20 years significant changes to policies, attitude and programs have occurred in relation to the employment of people with disabilities. There has been increasing recognition of the value of work and the capacity of people with disabilities to learn the requisite skills to gain employment.

PN57

PN58

Business services are funded to provide meaningful paid employment for people who, due to their disability may find it difficult to obtain or maintain employment in the open labour market, or who choose to seek employment with business services.

PN59

What they are saying in that situation is some employees with a disability would prefer to stay in the environment of a business service environment where they feel secure, they feel that they are able to do the work and they are working with people of similar disabilities. Some feel that they want to move out into open employment situations and the whole context of this report was to set up a mechanism to allow that to happen. For people to choose what they felt was best for them. That's people with a disability:

PN60

The aim of the business service review, a joint initiative between Accrod and the Commonwealth Department of Family and Community Services was to identify strategies that will ensure that business services are able to meet these requirements and continue to provide a valuable and viable employment option for people with a disability.For business services current ambiguities and a mismatch between policy and practice have seen the sector being identified as directionalist and struggling to gain credibility in some arenas.

PN61

PN62

There is urgent need to address a range of key issues so as to provide individual business services, and the industry as a whole with a coherent policy, funding and an operational framework within which to undertake their core activities. In developing our approach, regard has been given to key issues confronting the industry today and to those that will confront in the medium to long term.

PN63

PN64

In addition, this new framework addresses many of the issues that have been of concern to the industry for the last 20 years and have until now, remained unresolved. Our starting point has been to conceptualise and refine the role business services play in the provision of quality employment support for people with a disability. The key strategic imperatives for industry focus on the following themes; establishing a new paradigm for business services, improving performance and developing the industry. A new paradigm for business services.

PN65

The evolution of business services over time has led to an ambiguity about their role and function within the specialised employment system and within the broader labour market. Shifts in policy directions exacerbated this ambiguity which has left many business services unclear about their core roles and functions. Business services must have at their call a dual focus

PN66

It is very important that people understand that there is a dual focus within the business services industry. The dual focus being, firstly they must provide a service for people with a disability and secondly, that they must be a commercially viable operation to provide that service, and both of those coming together creates major problems within the industry, certainly in the cost factor:

PN67

Their duality of focus demands that they balance two effectively completing requirements to achieve success.

PN68

Basically what I was saying that there's on one hand they have got to provide the service and provide education and training for people and at the same remain competitive in the workplace and provide a viable and competing organisation.

PN69

As part of such a model, the target population for business services appears best determined by individual choice and ability and willingness to participate in work activities. This ensures that consistent with Government stated policy objectives for people with a disability, opportunities for employment remain available, not only to people with low support need but also to those with high support needs who wish to be employed. A business services capacity to provide good employment conditions for its employees, that is people with a disability, is dependent in the main on its ability to develop and maintain a commercially viable enterprise. For the business services industry this precondition is difficult to achieve. Currently on 53 per cent of the industry break even or is able to return a profit.

PN70

So the organisations are struggling to meet the requirements of the Government when it comes to a commercially viable operation.

PN71

Financial performance has a direct impact on the ability of business services to meet the costs associated with the provision of comprehensive employment conditions. So in order for business to fulfil their obligations as an employer, financial viability must be addressed concurrently with the establishment of a consistent approach to an industry-based employment conditions.

PN72

Linkages with the employment and income security system. As employers business services have strong links with the labour market, they are subject to the similar pressures and demands as many employers, and have many characteristics that are common to small businesses. Their fundamental business, however, is their duality or focus. Business services have the potential to provide an employment safety net for people with a disability, that traditional employers will not provide. They can achieve this because of their duality of focus, in that they tend not to sacrifice employment opportunities where there is a market downturn. Instead, they attempt to adjust their business focus to accommodate such changes. This disability services obligation plays an important role in the process.

PN73

To elaborate on that a little bit further is that if you had a situation where there was a downturn in the industry in a normal open employment situation the first thing that the organisation would do, would look at their costs and the first thing that would go they would reduce their labour. In the disability services industry and certainly with business services, that's not an option, they don't look at that as an option for their organisation. They look at how they can actually refocus their energies into getting new markets and providing employment for these people. The worst thing that could happen to an organisation like this would be to have to terminate somebody or to retrench somebody.

PN74

THE SENIOR DEPUTY PRESIDENT: Yet the agreement does have a redundancy clause in it.

PN75

MR AMOS: It does but obviously we put that in there because we felt that it was part of a normal employment contract and certainly that they should be part to, that most awards have redundancy provisions, so we put that in there to make it comparable with other awards:

PN76

Similarly due to their inherent purpose there is a nexus between the provision of employment for people with a disability and the income security system. Business services have a potential to enable people with a disability to generate an income over and above that provided by the Government through their income security. In the main this capacity increases the ability of people with disability to achieve financial independence while reducing the outlays from government. So what the Government is trying to achieve here is to increase the productivity of people with a disability and give them access to an increased remuneration at the same time reducing their pensions and reducing the cost to Government.

PN77

So that was the summary of that particular report, the report is some 60-odd pages and I am quite happy to send that down to his Honour if he wishes to have that.

PN78

THE SENIOR DEPUTY PRESIDENT: I think I would be interested to see it if you would be so kind, Mr Amos.

PN79

MR AMOS: I will do that for you.

PN80

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN81

MR AMOS: The agreement document. The negotiations agreement commenced in mid 2000 between the company and all the employees of the company acting as individuals. The initial consultation and negotiation was conducted with the employee committee and work committee representatives. Two of the work committee representatives are here today.

PN82

THE SENIOR DEPUTY PRESIDENT: Yes. How many work committee representatives are there?

PN83

MR AMOS: There was 5. These committees played an integral part in the education and awareness process of employees which was to convey to all employees an understanding of the terms and conditions of employment contained in the agreement. The agreement was not negotiated with an individual employee acting on his or own behalf or on behalf of the other employees.

PN84

THE SENIOR DEPUTY PRESIDENT: Well is that right?

PN85

MR AMOS: That's correct.

PN86

THE SENIOR DEPUTY PRESIDENT: Because it is signed by people who purport to be employee representatives.

PN87

MR AMOS: What we did, instead of having the agreement signed by every individual employee, we decided at the time of taking the vote the employees would also vote to have an individual sign the document on their behalf.

PN88

THE SENIOR DEPUTY PRESIDENT: But it wasn't negotiated by those representatives?

PN89

MR AMOS: It wasn't negotiated by these people, no.

PN90

THE SENIOR DEPUTY PRESIDENT: I see, because it is signed by a Mr Leddy on behalf of the company and by two people who are said to be employee representatives.

PN91

MR AMOS: Yes, they were elected by the employees to sign the document on their behalf to get over the situation of all employees having to sign the document. In some cases some of the employees are unable to sign their name.

PN92

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, go on.

PN93

MR AMOS: Thank you. The content of the agreement formalises and consolidates the terms and conditions already enjoyed by employees into one complete document. Those terms and conditions of employment had been in place and accepted by the company for many years. In fact there is very little change, if any change to the terms and conditions of employment that these employees have been enjoying for many years. The company always took the view that any employee is entitled to the same terms and conditions of employment of people without a disability and they have treated people with a disability exactly that way.

PN94

THE SENIOR DEPUTY PRESIDENT: Yes.

PN95

MR AMOS: It is our view the education and awareness training associated with the making of the agreement helped to reinforce the employees understanding and acceptance of their existing employment arrangements. The organisation has always met its obligations to provide terms and conditions of employment to its employees and in particular those employees with a disability comparable to the terms and conditions enjoyed by employees without a disability and covered by awards that operate within the organisation.

PN96

The agreement will operate for a period of 1 year from the date of certification, and I refer to clause 1.5 date of period of operation, this will allow for the company during the period to refocus on providing more detailed and comprehensive competency and productivity based wage structure for determining wages. This process will meet the requirements of the Federal Department of Family & Community Services Business Services Reform Agenda. That reform agenda at standard 9 talks about employment conditions and it states that:

PN97

Each person with a disability enjoys working conditions comparable to those of the general workforce which requires organisations to provide wages and conditions in accord with a ratified legal industrial agreement and consistent with Workplace Relations Act 1996.

PN98

I might also add that a number of these agreements are being certified or about to be certified in the New South Wales Commission. Some of these organisations are not corporations and obviously to do a non-union certified agreement where there is no union involvement they haven't got access to the Federal jurisdictions so they must go through the State jurisdiction.

PN99

THE SENIOR DEPUTY PRESIDENT: Yes. Is the union not interested in being involved in these sorts of agreements at all, or has it not been invited?

PN100

MR AMOS: No, my experience is that the union will only become involved if they are invited by an employee. They tend not to be too interested in the industry mainly because there is very little reward or remuneration for them out of it, I think. It's very rare that employees with a disability would become members of the union.

PN101

THE SENIOR DEPUTY PRESIDENT: Yes.

PN102

MR AMOS: I might add that I have done agreements where the union has taken an active role and I'm in the process of doing one right at this very minute with an organisation in Newcastle where the union are taking an active role. I might add it is not the LHMU either it's the AWU.

PN103

THE SENIOR DEPUTY PRESIDENT: I was just about to ask, which union is it?

PN104

MR AMOS: The AWU in Newcastle.

PN105

THE SENIOR DEPUTY PRESIDENT: The AWU, yes.

PN106

MR AMOS: They are taking a very active role and are contributing quite substantially to the making of the agreement and the company and myself are quite happy to work along with the union and they are quite happy to work with us and I think at the end of the day we'll end up with an agreement, not unlike the agreement we have go here today.

PN107

THE SENIOR DEPUTY PRESIDENT: Not unlike or?

PN108

MR AMOS: Not unlike, it is very much the same.

PN109

THE SENIOR DEPUTY PRESIDENT: Will you also seek to have designated the Australian Liquor Hospitality and Miscellaneous Workers Union Supported Employees Business Services Award as the appropriate award?

PN110

MR AMOS: Yes we will. They have agreed to that also.

PN111

THE SENIOR DEPUTY PRESIDENT: The AWU?

PN112

MR AMOS: The AWU.

PN113

THE SENIOR DEPUTY PRESIDENT: The status of that award is I understand it is that it has not been simplified.

PN114

MR AMOS: It hasn't, no.

PN115

THE SENIOR DEPUTY PRESIDENT: But there has been a hearing I think before Senior Deputy President Duncan, are you aware of that?

PN116

MR AMOS: I'm not 100 per cent sure of that, your Honour, but I know that the award hasn't been simplified and I'm not quite sure what status it's at the moment with that simplification process.

PN117

THE SENIOR DEPUTY PRESIDENT: Yes, that's one of the factors that make me wonder whether it's appropriate to designate it. It's arguably not appropriate in any event, and in the second place it hasn't yet been simplified. These are the conundrums that I'm facing I think. Have you got any submissions about the fact that it is not simplified and whether it is nevertheless appropriate.

PN118

MR AMOS: I haven't. The only thing that I can suggest is that this particular agreement really does cover all the terms and conditions of employment that would be relevant to this particular organisation and it's quite comprehensive in its content and I would suggest that even if the award is simplified it would not affect the content of this agreement in any shape or form.

PN119

THE SENIOR DEPUTY PRESIDENT: Yes. If I certified the agreement without designating the award, that would not affect the operation of the agreement either, would it?

PN120

MR AMOS: No, it wouldn't, your Honour.

PN121

THE SENIOR DEPUTY PRESIDENT: No. Good.

PN122

MR AMOS: Pro rata wages, award wages in accord with either a legally ratified or legally recognised assessment tool. That's the standard 9 employment conditions that the department is advocating that should be addressed when we are putting agreement together.

PN123

THE SENIOR DEPUTY PRESIDENT: Yes, and where do I find that in the agreement? Which clause do you take me to in the agreement?

PN124

MR AMOS: If you go to schedule C which is the skills assessment process. If you look at schedule A it talks about Competency Based Wage System. They are referred to in clause 4.1, which is remuneration.

PN125

THE SENIOR DEPUTY PRESIDENT: I must say I have read this, but I am not sure in my own mind how it all works and that's what I am asking you to explain to me.

PN126

MR AMOS: Basically what happens is that if you look at schedule B the whole context of the agreement operates around schedule B which describes all the types of activities that are undertaken by employees of the organisation. It is assessed in accordance with National Training Board assessment processes in that a persons skills are assessed against what is required and to the performance criteria that has been established in schedule B.

PN127

THE SENIOR DEPUTY PRESIDENT: Does the agreement require that it be so assessed in accordance with National Training Board requirements?

PN128

MR AMOS: It does.

PN129

THE SENIOR DEPUTY PRESIDENT: Can you just point out to me where it requires that?

PN130

MR AMOS: In clause 3.2 Skills Development on page 14 last paragraph it says:

PN131

The company will endeavour to provide employees with career opportunities linked to their ability to obtain and maintain their required level of skill competence in line with the job models which is contained in schedule B. Training and assessment programs will be structured to meet all current legislative and national training framework requirements.

PN132

The structure will be linked to the acquisition of what we call task related competencies, vocational related competencies and output competencies. Task related competencies being the job that is to be undertaken, vocational type competencies related competencies are general competencies that are more about - and I think the - well I can read the definition of it which is in schedule A:

PN133

Work related competencies are general vocational skills necessary to maintain successful employment.

PN134

Those may be just the ability to get to work, self hygiene, understanding occupational health and safety procedures and those sort of the things. They are just general vocational type competencies. The task related competencies are basically the competencies that are required to undertake a particular job. In fact an example of that in one industry may be to, in a screen printing situation, may be able to, they know how to screen print a piece of cloth. That is a task. Then we have the productivity type competency which is the actual performance outcomes that are required by the organisation to be at a particular level.

PN135

THE SENIOR DEPUTY PRESIDENT: At some stage are you going to explain to me the nature of the work that is performed at Lasercraft?

PN136

MR AMOS: Yes I will, your Honour. As a matter of fact I'll explain that now.

PN137

THE SENIOR DEPUTY PRESIDENT: Whenever it is convenient to you.

PN138

MR AMOS: Lasercraft are a manufacturing organisation that do awards and trophies and those sort of things. I might get Mr Leddy to give you a full overview of what the company does.

PN139

THE SENIOR DEPUTY PRESIDENT: Yes.

PN140

MR AMOS: That would probably be a good idea.

PN141

MR LEDDY: Thank you, your Honour. Basically I am a parent of a severely disabled son and I have been involved in the disability industry for 25 years and my motivation in short is to have a future for my son, hopefully well beyond my passing. Lasercraft Australia was an offshoot of a sheltered work shop type environment that has existed about 10 to 15 years ago. It still exists. Government policy determined that these organisations should be de-institutionalised and we obtained some start up funding to create a business based on the laser engraving, manufacturing and laser engraving of recognition awards and business gifts.

PN142

We have established ourselves as the premier manufacturers supplier and the company was supplying to the top 3000 companies in Australia. Again recognition awards and business gifts including our clients, the Prime Minister's Department, and all the major corporations. The business is, of itself, whilst non-profit, is quite self sufficient from the disability side of the activity. The people with disabilities give some limited input into the manufacturing but the manufacturing stand alone. That is in essence the nature of the building the profits or the excess of income of expenditure that could come from the business operations partially, subsidise the employee support needs in some incidences quite high in probably 60 per cent of our work force almost entirely non productive. So they are very high support need people. My two representatives here are at the upper level of my employees.

PN143

THE SENIOR DEPUTY PRESIDENT: Could you tell me what sort of equipment is being used and what sort of tasks are being performed by the people with disabilities?

PN144

MR LEDDY: Generally speaking, if we manufacture a product which requires a lot of machining and fitting my qualified trades people there are some aspects of cleaning, packaging, assembly to some small extent. Generally speaking, at the moment we are predominantly, we predominantly bring in some small packaging tasks from outside because of the even flow of business. I have a situation here, your Honour, which Peter actually manufactures. We have developed a little promotional gift to assist in our marketing process, we do the machining, people and others do the assembly work.

PN145

In essence it is a work creation situation but it does have the benefit of involving the people with disabilities. At the same time it allows us to forward it to all of our clients, some 3000 in all. There is no direct benefit back to the organisation or tangible benefit in terms of income. But there is other issues in terms of the pride of workmanship and also the benefit of continual marketing. We develop products for argument sake which facilitate the combination of the best levels of the worker skills that we can at the same time integrate them into the marketing process. A combination in short of some minor assembly with the products which are catalogued here if you are interested, your Honour, and some subcontract work and some marketing there.

PN146

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN147

MR AMOS: Your Honour, the rates of pay contained in this agreement and I refer to clause 4.1 Remuneration in schedule A, have been established taking into consideration the following criteria. The rates of pay paid to employees prior to the agreement and the organisation will place all employees at the most appropriate rate relevant to their pre-agreement rate, the capability and their skills having regard to the fact that no employee shall be paid less under the agreement than they would have been paid prior to making the agreement. So they were moving into the structure somewhere around where they currently are. Some employees will get a pay increase out of it, some will stay where they actually are but nobody will get less than they are currently getting.

PN148

THE SENIOR DEPUTY PRESIDENT: Yes, and I take it nobody will get less than they would had this organisation been bound by the award.

PN149

MR AMOS: Well the calculation under the award - the minimum rate that can paid under the award is 15 per cent of the 100 per cent rate which at this point in time I think is $413.40 and 15 per cent of that would be around about $50-odd.

PN150

THE SENIOR DEPUTY PRESIDENT: Yes.

PN151

MR AMOS: Under this agreement the minimum rate which is an entry level employee and even level 1 is $47.50 and $49.40. But it is like comparing apples and oranges for instance. The way that the award works, it works on the supported wage system. This system here works on the skill and the productivity of an employee. I am sure you are familiar with the supported wage system and the way it calculates pay for people.

PN152

THE SENIOR DEPUTY PRESIDENT: Yes, but not in detail I might add.

PN153

MR AMOS: Okay. Well the supported wage system basically is a time and motion study of employees productivity. In other words they are measured against 100 per cent based on the time it takes them to do a particular task and my own personal view is that I am totally against that concept. I don't think I would like to be assessed myself that way and I am sure nobody in this room would like to be assessed that way. But certainly that is the supported wage system and is the system that has been in place for a number of years now. It is not the best system but it is the system we have. The system we are advocating here is based on the skill of an individual measured against the productivity of that individual against 100 per cent of an employee without a disability.

PN154

THE SENIOR DEPUTY PRESIDENT: Where the award provides that:

PN155

Employees with a disability should be paid such a percentage of the rate for the employees where it equals the skill level of the employee assessed as a percentage of the skill of an employee who is not disabled.

PN156

The way in which you measure it under this agreement is not the same.

PN157

MR AMOS: No, it's not. We don't look at the time it takes them to do it. We actually look at the skills and we place the skills into different levels of ability and then we measure that against their output. We don't measure it against an individual's output either, we measure against the grouped output. If you understand the way this industry works is that an employee with a disability on any one day may perform better than they do on another day. There are peaks and troughs. To measure a person at a particular point in time against their productivity is what we don't consider as a relevant measure.

PN158

We need to strike up an average of how they are performing over a period of time, and we need to do that over a group, rather than an individual. That's how we have assessed and got our schedule A together here. I might add, the rates here are higher than what they were getting prior to the agreement being made. The lowest level is 11.5 per cent of the $413.40 which is the agreed one.

PN159

THE SENIOR DEPUTY PRESIDENT: Yes.

PN160

MR AMOS: We also look at the productivity of employees with a disability, the maintenance of the current and future employment levels of people with disability. It's important that no employee will lose their position out of making this agreement, so we needed to ensure that the wage rates were consistent and the organisation was able to fund the rates that are contained in the agreement. The inherent obligation of the organisation to provide employment for people with this disability no matter how severe the disability may be, or how productive or non-productive an employee may be, to generate an income to cover their wages.

PN161

The wage structure contained in the designated award, we did take that into consideration. The continued operation of the commercially viable business to enable the organisation to meet its budget obligations through its commercial activities. When we looked at the relative award the majority of people in this agreement would not ever get to the situation where they would move into an open employment situation. Therefore the award wouldn't come into play when it looked at measuring their productivity. Certainly that minimum 15 per cent, that would never happen.

PN162

The rates of pay may result in pay increases for some employees on the rates paid prior to the agreement, depending on the competency level of the individual employees when assessed against the skills matrix contained in the agreement. The agreement provides also for wage increases during the life of the agreement in accordance with the national wage case decision as determined and agreed by the Australian Industrial Relations Commission from time to time. I refer to clause 4.2. The rates will be increased pro rata, on a pro rata basis, in line with any national wage case decision that is handed down from time to time. The agreement at clause 7.1, "Avoidance of disputes agreements procedure," provides a mechanism for settling disputes and grievances with employees. The object of the procedure and the primary function is to promote the resolution of issues and disagreements through consultation, co-operation and discussion between employees or employee representatives inhouse.

PN163

The procedure also requires either party or if all avenues of resolution have been exhausted, to refer the matter to the Australian Industrial Relations Commission for firstly conciliation and then for arbitration if conciliation is unsuccessful. The agreement does not disadvantage employees on balance with the terms and conditions contained in the designated award. The statutory declaration provided with the application meets all the requirements of the making of an agreement and at clause 5.1, specifies the steps taken by the employer to give all employees whose employment would be subject to the agreement, reasonable opportunity to decide whether they wish to make the agreement.

PN164

At clause 5.10 the statutory declaration specifies the steps taken by the employer to explain the terms of the agreement to the employee subject to it under section 17, your case 7. That is employees with particular circumstances. At clause 5.11 the statutory declaration specifies the appropriate process undertaken to explain to employees the terms of the agreement having regard to persons with particular circumstances and needs. At clause 5.1 the statutory declaration proclaims the majority of employees covered by the agreement wanted to make the agreement.

PN165

THE SENIOR DEPUTY PRESIDENT: Can I just ask you about that? It says that a formal secret vote was taken on Tuesday 21 August and resulted in complete acceptance. Could you just tell me the nature of that vote, how was that adopted?

PN166

MR AMOS: Yes, I might get Mr Leddy to explain in detail to you, your Honour, how that took place.

PN167

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN168

MR LEDDY: Thank you, your Honour. We were particularly anxious that we could give maximum input into peoples understanding of what the whole process was all about, because frankly to the majority of our people, if I were to say to them, "Would you like to have a reduction in pay?", everybody would say, "Yes." So I had to go through a process of educating what entitlements were, how they related to those of non-disabled people, if it was fair for one group would it be fair for another group? A lot of devils advocacy, and so on.

PN169

THE SENIOR DEPUTY PRESIDENT: Yes, I have seen, I have looked through that document that has got photographs in it and demonstrations.

PN170

MR LEDDY: Yes, once we went through that exercise with the people who we felt were reasonably able to understand the fairly basic entitlements, we then created the book and went through maybe half a dozen fairly basic role plays with the group. We then asked the group of people who had represented them to give their individual comments and their reasons why they were in support of the group. We then had four individual training sessions using the book itself for the majority of the people. We explained to them their entitlements, if they didn't like it they had full entitlement not to vote. Again, devil's advocacy. Then after the final agreement everyone was given a copy of this which was an individual voting form, all of which are here.

PN171

THE SENIOR DEPUTY PRESIDENT: Yes, could I just have a quick look at that, please? Was it explained to the people that putting a tick in, indicated that they wanted to have the agreement put across was - - -

PN172

MR LEDDY: We had to go to that level, your Honour. We endeavoured to ensure that it didn't matter to us which way they chose.

PN173

THE SENIOR DEPUTY PRESIDENT: You say it was a secret ballot, how was it secret?

PN174

MR LEDDY: People were asked to take their forms away, go to a quiet corner and return to the meeting room as in five minutes, no identification was given. We had a box, people were asked to put it into a voting box so it was made very similar to, like a vote for politicians what-have-you. People folded or placed their votes in a box, we then asked the people then if they would like to see the results of their voting procedure. We cut the box open and we went through one after the other and laid them all on the table, and there were no rejections, your Honour.

PN175

THE SENIOR DEPUTY PRESIDENT: Yes. What involvement of parents or guardians was there in negotiating the agreement and having to have explained it to the employees concerned?

PN176

MR LEDDY: Formal notification, your Honour, letting you know that the process was to be undertaken. We then had two separate Parent Carer Advocate meetings where everybody was invited, in fact encouraged to participate - they were probably half day meetings.

PN177

THE SENIOR DEPUTY PRESIDENT: Were Parents Carers Advocates well represented at the meeting?

PN178

MR LEDDY: Very well represented. Quite substantially represented, your Honour. At around about that time we had gone through about six meetings, so in order to give the parents the format of what was being undertaken, we made copies of all of two of the employee minutes and distributed those. We distributed the formal agreement, as in the legal language type agreement - - -

PN179

THE SENIOR DEPUTY PRESIDENT: Yes I must say that's one of the things that concerns me. It's an agreement that's fairly long and uses fairly legalistic language and yet I have to be satisfied that a valid majority genuinely approved the agreement in circumstances where it seems that there's little likelihood that the people concerned really understand or can understand the agreement.

PN180

MR LEDDY: I couldn't agree more, your Honour, and I think there is attached to this there's a summary of this agreement and I think in the last couple of paragraphs I've really pointed out that it - - -

PN181

THE SENIOR DEPUTY PRESIDENT: That's in your statutory declaration is it? What you are talking about now or ?

PN182

MR LEDDY: Yes. I think I've actually pointed out that the integrity - - -

PN183

THE SENIOR DEPUTY PRESIDENT: I am not sure at all to what document you are referring there Mr Leddy.

PN184

MR AMOS: It's the statutory declaration document, your Honour.

PN185

THE SENIOR DEPUTY PRESIDENT: Yes, where is it?

PN186

MR AMOS: In conclusion on 5.1.

PN187

MR LEDDY: I have here "Agreement Awareness by Employees with Disabilities" and I was particularly aware of having regard to comments made by - - -

PN188

MR AMOS: Her Honour Deputy President Drake.

PN189

MR LEDDY: Who was concerned about organisations being able to demonstrate an awareness or that that people were aware. If I could go back to one issue. We invited Parents, Carers, Advocates to have any input at any point into the process. We advised that we would keep them fully informed and in particular, prior to the two week period, we invited them in once again and brought them right up to speed on every aspect of the agreement, going through a number of the meetings and presenting this document and allowing them to take that home together with copies of the agreement for a week asking for their input in any way, shape of form that they chose.

PN190

Your Honour, if I might just read this summary

PN191

"Agreement Awareness by Employees with Disabilities". The workplace agreement of Lasercraft's employees with disabilities has been an exhaustive process extending over many months. The employee representatives were elected predominantly as people most likely to understand the concepts and contents of a Workplace Agreement and in so doing, to represent the best interests of fellow employees.

PN192

PN193

Part of our education process was to consistently explain their role in representing others. Notwithstanding the extensive training and frequent reiteration of entitlements owing to employees, periodical revision sessions indicated that the Workplace Agreement was, and continues to be understood only at a fairly basis level. It was only when role play was introduced into the discussion and obvious black and white options presented to employees, that choices were articulated at that point in time.

PN194

Your Honour, the minutes of all of the meetings contain the written words of that which was articulated in heavy printing - - -

PN195

THE SENIOR DEPUTY PRESIDENT: I looked at those minutes. I don't profess to have read them all but that was actually one of the matters that prompted me to ask the question that I asked, because it's clear from those minutes that concepts were explained to people but not the wording of the agreement.

PN196

MR LEDDY: They were in depth, your Honour, and I acknowledge that freely, I acknowledge that freely. It was only when role play was introduced but there is one way in which we were able to - - -

PN197

In the final analysis because it was an extremely frustrating process we then had to begin to say: Well look, there are two groups of employees here. There are those that are covered under their various awards and there are others. So we at least were able to say: Look, if it's good enough for you to have an entitlement, then it's good enough for us. The way we did that was to say: Well, look I'm going to take - instead of having four weeks holiday this year you can only have two. What do you think about it? Oh, well that's okay. No it isn't because if I were to do that to other nondisabled people, would they accept that? No.

PN198

So we had to go at that level. Eventually the group understood that if it was good for one group of people then they felt it was fair for them as well. So we were able to cover a very wide spectrum of some quite difficult points by saying, "If it's good enough there, it's good enough here".

PN199

PN200

Most weekly sessions necessitated substantial revision of the previous weeks meeting contents prior to moving onto a new topic. Following meetings and education sessions for those employees not involved in the Committee process, feedback suggests that the Agreement contents are understood only at those very basis levels contained in the pictorial easy read version.

PN201

The conclusion, your Honour, is important because of the nature of the people that offer the supports to people with disabilities.

PN202

THE SENIOR DEPUTY PRESIDENT: I would ask you to also read that onto the transcript please, Mr Leddy.

PN203

MR LEDDY: Yes, your Honour:

PN204

Lasercraft Australia has resolved to assist in implementing a Workplace Agreement with and for its supported employees which is fair, transparent and which equates with entitlements already enjoyed by both employees with a disability or without a disability. The Supported Employees Workplace Committee have articulated their best efforts in understanding the agreement following the most intensive level of training and awareness that the company could provide.

PN205

There have been no objections from Parents, Carers or Advocates to the Workplace Agreement or its process notwithstanding invitations to thoroughly peruse the contents and express concerns, if any exist. No employee will be disadvantaged by the agreement which formalises and consolidates previously provided entitlements. Opportunities for increased wages now exists through a more clearly defined skills matrix and grading structure for people capable and willing to progress.

PN206

Your Honour, there is something here that I understood that I basically pointed out what the motivation of Lasercraft at a directors level and a management level was in ensuring this. Alas I can't see that, I did forward it. But in short, your Honour, we felt that we wanted to establish an agreement that would go beyond the existing management in ensuring the entitlements of people, if circumstances change with our organisation. Alas, I can't put my finger on it.

PN207

Our Board of Directors being of a similar ilk and coincidentally being business people and coincidentally belonging to Rotary and other Community organisations was strongly supportive of this and felt that it was in the nature of the organisation to ensure that we gave it our full support of education resources. Thank you, your Honour.

PN208

MR AMOS: Your Honour, in closing we would ask the Commission to exercise its power pursuant to section 170LT(3) of the Workplace Relations Act 1996 and certify the agreement known as Lasercraft Australia Limited Supported Employees Workplace Agreement 2001. Then firstly ensure the continued commercial viability of the organisation. Secondly, to enable the organisation to provide continued and future employment to all people with a disability. Three, to meet its legal obligations to provide employment conditions comparable to those of people without a disability, and four, to comply with the reform agenda implemented by the Department of Family and Community Services Federal Department regarding employment of people with a disability.

PN209

Your Honour, in saying that I will draw your attention to the certification of the Summerland House Agreement by Her Honour, Senior Deputy President Drake some two weeks ago. In that she certified the agreement having regard to - the agreement was to only formalise what the employees had been used to and been enjoying for many years. She took the view that if they had been enjoying the conditions for many years then they must understand the terms and conditions of the agreement. If those terms and conditions are no different to what they had been enjoying then she was convinced that they must understand what the terms are.

PN210

THE SENIOR DEPUTY PRESIDENT: Has her Honour published the decision in the Summerland House verdict?

PN211

MR AMOS: There are a number of decisions that talk about this issue. The other decision is the Raymore decision, I'm sorry I haven't got a copy of that decision with me but certainly - and the Summerland House one certainly does - - -

PN212

THE SENIOR DEPUTY PRESIDENT: There is a published decision is there?

PN213

MR AMOS: Yes.

PN214

THE SENIOR DEPUTY PRESIDENT: If you could provide me with a copy of that or the reference to the print number I would appreciate it.

PN215

MR AMOS: I'll do that, your Honour, yes. There is one that, your Honour, I am familiar with in Roytell - - -

PN216

THE SENIOR DEPUTY PRESIDENT: Roytell, that's the one I'm thinking of.

PN217

MR AMOS: In that matter, your Honour, it didn't designate the award.

PN218

THE SENIOR DEPUTY PRESIDENT: No, that was the one you may recall I suggested that the advocate for the organisation argued that that wasn't the designated award or these employees were award free.

PN219

MR AMOS: Yes, that's right.

PN220

THE SENIOR DEPUTY PRESIDENT: Mr Amos, I'm inclined not to designate the award but to nevertheless certify the agreement. Would that cause you any problem?

PN221

MR AMOS: No, your Honour, that wouldn't cause us any problem at all.

PN222

THE SENIOR DEPUTY PRESIDENT: So I am not convinced that it is the appropriate award and if it doesn't cause you problems that may be the better way to go. Perhaps something ought to be done about that award, it's been there for a while and may or may not be the appropriate award. Does section 10 or 12 of the Disability Services Act apply to these people at all?

PN223

MR AMOS: Yes, it does.

PN224

MR LEDDY: Yes, it does, your Honour. Sorry, I keep interrupting.

PN225

MR AMOS: No, I would have no objections to you not using that award as the designated award although we would use that award as this agreement would operate in conjunction with that award to any inconsistencies.

PN226

THE SENIOR DEPUTY PRESIDENT: Yes, well that is a matter that is provided for in the agreement and doesn't require the designation of the award for that matter, yes.

PN227

MR AMOS: We would have no objections to that. Thank you, your Honour, that's the end of my submission. I would just ask that the Commission certify the agreement in the terms presented here today.

PN228

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Amos.

PN229

Well I am in a position to indicate that I will certify the agreement operative from today. I am satisfied now that I have heard from particularly Mr Leddy and also Mr Amos that the employees concerned generally approved it in the only manner in which a genuine approval could be given by them. Despite what appears to be a limited understanding of the technicalities of the agreement having heard Mr Leddy's explanation of the process and the way in which the operation of the agreement was explained to the people concerned I'm satisfied that there was a genuine approval by the majority of the employees concerned.

PN230

That I think was the main matter that was concerning me and why I have asked all the questions this morning that I have asked. The other aspects of the legislation have been complied with. I am satisfied that the agreement is made between an employer that is a constitutional corporation is carrying on a single business and employees employed in a single business. I don't need to be satisfied that the agreement passes the no disadvantage test because I will exercise my discretion and despite the fact that it may or may not satisfy no disadvantage test depending on what decision I come to on the designation of the award, I would exercise no discretion under section 170LT(3). I am certainly satisfied that certifying the agreement is not contrary to the public interest.

PN231

Accordingly I will indicate to the parties that the agreement will be certified operative from today. I will reserve my decision as to the designation of the appropriate award but that won't affect the operation of the agreement and the appropriate instrument will issue as soon as is practicable. Thank you for your attendance and the comprehensive explanation you gave me of the way in which the agreement was negotiated.

ADJOURNED INDEFINITELY [12.32pm]