C2001/4996, Transcript of Proceedings [2001] AIRCTrans 2719 (10 October 2001)

AUSCRIPT PTY LTD
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Level 7, ANZ House 13 Grenfell St ADELAIDE SA 5000
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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER FOGGO

C2001/4996

COMMUNICATIONS, ELECTRICAL, ELECTRONIC, ENERGY, INFORMATION, POSTAL, PLUMBING AND ALLIED SERVICES UNION OF AUSTRALIA

and

DIRECT ENGINEERING SERVICES TRADING AS FRIGRITE AIR CONDITIONING

Notification pursuant to section 99 of the Act
of a dispute re company not providing rostered
days of pursuant to the award

ADELAIDE

11.05 AM, MONDAY, 24 SEPTEMBER 2001

PN1

THE COMMISSIONER: Could I have appearance in both matters please?

PN2

MR A. SHORT: If the Commission pleases I seek leave to appear for the company. Appearing with me is MR A. MARKIEWICZ.

PN3

MR W. DEAKIN: If the Commissioner pleases, I appear on behalf of the CEPU Electrical Division.

PN4

THE COMMISSIONER: Is there good reason we have been waiting 20 minutes?

PN5

MR DEAKIN: Yes, sorry, Commissioner, but the car parking out there is everything is loaded up at the moment, I've been chasing around Adelaide trying to get car parking.

PN6

THE COMMISSIONER: Yes, apology accepted, Mr Deakin.

PN7

MR DEAKIN: Thank you.

PN8

THE COMMISSIONER: Mr Deakin, I understand that there is some concern in relation to the hearing of this time of the section 127 application, is that correct?

PN9

MR DEAKIN: Yes, Commissioner.

PN10

THE COMMISSIONER: All right, could you explain to me why please?

PN11

MR DEAKIN: Well, it has been run at the same time as we got we have got a section 99 dispute. As far as we are concerned we have complied with the Act as far as our notification of disputes and we believe that the parties have been acting capriciously in this matter.

PN12

THE COMMISSIONER: All right. In relation to the section 99 application, notification from the CEPU is received concerning the company allegedly not providing rostered days off pursuant to the award. Now, do you say that is a different matter to the section 127 application from the company?

PN13

MR DEAKIN: Yes, Commissioner.

PN14

THE COMMISSIONER: All right, well, if that is the case what I intend to do is to deal with the section 99 application first and then proceed to hear the section 127 application. Mr Short, do you have anything to say in relation to that?

PN15

MR SHORT: No, that is for main import for the Commission.

PN16

THE COMMISSIONER: All right, thank you. Mr Deakin? And leave is granted, Mr Short.

PN17

MR DEAKIN: Commissioner, the problem we have had in the last few months with the employees at Frigrite's is the concern over the proposed agreement that was put in place in lieu of the award entitlements. There was two issues and I've got them down there on our section 99, was underpayment of wages and the rostered day off.

PN18

THE COMMISSIONER: Well, there is nothing about payment of wages in relation to this. Your application indicates that the rostered days off pursuant to the award is the issue which is the subject of the application.

PN19

MR DEAKIN: I disagree with that. Okay, well, it was agreed anyhow, Commissioner that I would speak to Mr Vanis on the issue of the payment of wages that we perceived to be happening. But the rostered days off, Commissioner, came about with an agreement tried to be put in place by the company with people in the company that they wanted to change their hours from the 38-hour week to a 40-hour week. It was initially proposed to do that as a consent matter as agreed matter which had a flexibility they didn't like, they couldn't revert back to.

PN20

We have two people in the company who chose not to and stayed on the 38-hour week with a rostered day off. The others chose to try it, try the issue. What happened was the company then turned around and said to them, well, now it is in. There is no changing back. It is a 40-hour week, all new employees that were coming into the company were having to comply with the 40-hour week. Although all the workers down there don't want to work a 40-hour week. They want to go back to the 38-hour week that had been - that was - they were employed originally. What has happened now is the company is saying, no, it is not happening.

PN21

That has also been part of our log of claims that they are able to revert back to their 38 week. However because it would become a major sticking point we thought the best point would be would be to bring the matter into the Commission under a section 99 as a dispute. There is another couple of issues associated with that one form of transactions. It does not identify on the pay sheets appropriately how this 40 hour is working and we asked on a number of occasions to - for the company to prove to us or identify the payslips what is the basic hourly rate. In fact we have had to go through some organisation, another association to find out what the appropriate hourly rate is for these people and all the wages on above. What is happening is that we don't have - I will just give you - I will hand up Commissioner, a copy of the payslips.

EXHIBIT #D1 COPY OF PAYSLIPS

PN22

MR DEAKIN: Commissioner, under the Act regulations, all allowances and such like have got to be identified on payslips. I would like to hand up a copy of the award requirements and a copy of the Workplace Regulations on payslips.

PN23

THE COMMISSIONER: The excerpt in relation to the payment of wages comes out of what document?

PN24

MR DEAKIN: Yes, it is out of the Metal Engineering Association Industries Award.

PN25

THE COMMISSIONER: 1998?

PN26

MR DEAKIN: Yes. Sorry, 1999 edition.

PN27

MR SHORT: It does not look like this Commissioner, it looks like it is someone's summary of it, a note. That is not the language of the award.

PN28

THE COMMISSIONER: That is not. I have the award with me.

PN29

MR DEAKIN: There is a summary there, Commissioner, page 49.

PN30

THE COMMISSIONER: Yes, 5.11 of the Metal Engineering and Associated Industries Award 1998 is language which you would expect in the award. It seems to me that this sheet is as Mr Short says, a summary of what is actually in the thing - so does this come from an internal document of the CEPU?

PN31

MR DEAKIN: Well, it comes actually from the part 9B 132B of the Workplace Regulation.

PN32

THE COMMISSIONER: No, no not that one. This one that has got the black background?

PN33

MR DEAKIN: Yes, it has come out of - it is the CEPU booklet on the Metal Engineering Association Industries Award.

PN34

THE COMMISSIONER: Yes, it is a summary of what is in the award.

PN35

MR DEAKIN: Yes.

PN36

THE COMMISSIONER: For the purposes of these proceedings I will rely on the actual award rather than the summary because that is the Commission document.

PN37

MR DEAKIN: Okay. But the other documentation we have placed in front of you, ma'am, is the payslips part 9B of the Workplace Regulations and it is the same.

PN38

THE COMMISSIONER: Yes, it is. I don't need to mark either of those documents they are documents of the Commission. You are referring to 132B of that?

PN39

MR DEAKIN: Yes. Referring to that it goes through the list of things that have got to be identified upon the make up of the hourly rate, how many hours it is for, any allowances, any deductions, going through and just itemising, that is what happens but if you look at the payslip that was handed up in front of you, it just said is a 40-hour week. Well, for 40 hours at $18 per hour. Now, that is not correct, because what they are doing they are asking the guys to work 40 hours and under the award because it is a 38-hour week the 40 hours is paid at time and a half as I've been informed. Well, then if you take that there is another hour there, there is an hour missing ..... they termed as a time sheet.

PN40

But what they have said to me on a quick discussion that we have had what we do we check, we take that 1 hour that is at penalty rates, and divide by 38 and put it into the hourly rate. I have said you can't do that. What it should be if it is a 38-hour week the people are working 40 and that becomes the hourly rate, then what you have got to do is take those 2 hours at penalty rate, divide by 38 put into the - as the hourly rate and you have got to put something on your payslips to identify how that transaction has occurred and what the basic hourly rate that the people are entitled to because they can't - they don't know from this documentation placed in front of you.

PN41

So this is all tied up with the rostered days off. It creates many problems for us and for the employees because they can't tell me and I can't tell you right now the make up of that $18. Not any allowances on top, not any overtime. I can't find out what makes up that $18 and neither do the employees and that is because of the 40 hour week. So that is one of the side issues that we have relating to this 40 hour week that the employers are now forcing on the workers to participate in.

PN42

The other matter with this, and I have been referring to time and a half for the first 2 hours as has been told to me, on many occasions, whilst sitting down negotiating with the employers, they get 2 hours at time and a half. However, coming from that, we have got documentation saying that the original agreement was a flexible agreement, a 1 year agreement, and that people had the choice whether to go back to the 38 hour week. It is suppose to have been in that - it is suppose to have been a flexible agreement for a 1 year period and they could go back to a 38 hour week and the rostered day off if they chose to. I would like to present this up to the Commission, a copy of this agreement.

EXHIBIT #D2 AGREEMENT

PN43

MR DEAKIN: As you can see in the opening statement, this a trial period for 1 year:

PN44

Frigrite Airconditioning Service department is interested in revising the hours of work, normally worked by refrigeration mechanic in South Australian service department. Participation in this agreement is to be by mutual agreement between the employee and the company and is not considered compulsory by any party.

PN45

THE COMMISSIONER: Mr Deakin on the front page of the memorandum, the memo is dated 2 October 1996.

PN46

MR DEAKIN: That is right.

PN47

THE COMMISSIONER: So the 1 year trial period has well and truly finished, hasn't it?

PN48

MR DEAKIN: Yes, Commissioner, certainly has and in none of the cases the employees agreed or signed any documentation to say that they would continue with this flexible agreement. In fact, all of the employees that have started there since have been informed it is a 40 hour week. They are not getting a choice. They are saying, well, that is what you have got to do. Now, people are told what the hourly rate is on a 40 hour week. People, whether they wanted to go back to a 38 hour week, is they can't. In other words, the employees are being forced, I say to the Commission, forced to work 40 hours whether they want to or not. There is no flexibility with those 2 hours, which is contrary to the awards. There is no forcing of people to work. There is the issue of considerable amount of overtime, we have got no problem with that one but being forced on a regular basis to do a 40 hour week.

PN49

THE COMMISSIONER: What do you call "considerable"?

PN50

MR DEAKIN: Well, it is in the award is everybody is prepared to work a certain amount of overtime. You know it is - - -

PN51

THE COMMISSIONER: Are words "a reasonable amount of overtime"?

PN52

MR DEAKIN: A reasonable amount of overtime and there is no problem with that. However, they are not getting a choice. New people coming into the company have no choice, this is it. Now, I have read the award and the award says that if there is an agreement in place by the employees, they can work that and then later on down the track that is what the company has agreed to, that is what the employees agreed to, that is the working position. However, the agreement that was put in place originally was for 1 year. It was flexible. They could go back to the 38 hour week and they have been denied that.

PN53

They have been told: you don't have a choice. That is it. That's what agreed to. If you look down, there is another part in there that is conflict. Whilst sitting around negotiating the EBA across the wage rates and trying to understand the wage rates, and this is the great difficulty for us all, if you look at point 5, payment: (a), is a $50 week increase to the current weekly rate. 2 hours previously accrued on RDOs will be paid at the current double time rates. Now, we are being told it is time and a half.

PN54

So I can't come to the Commission and I don't think the company can come to the Commission and tell you how this is all made up because sitting around the table and the other two parties too, the employees representatives for the consultative committee, were at a loss when the company kept talking about time and a half. One of the parties there pulled out the document which reminded everybody that it was double time. Now, they are being paid at time and a half for the first 2 hours.

PN55

Not only that, it raised another question. If they are working these 2 hours at a time and a half then other overtime that they do, there should only be another 1 hour and then it goes onto double time. Now, I don't think that is happening. I think if they work 3 or 4 hours, they still have to work time and a half on the first two or three. We have not had any information placed in front of us that can identify all this. So that is what why we are here today, Commissioner, is to try and - people want to go back to the 38 hour week.

PN56

Like I said, there is two people who chose not to adopt this and are working a 38 hour week and are getting rostered days off. The rest of the company on the engineering and construction sites are on a 38 hour week. It is just about 12 to 14 people - sorry, about 18 people in the service area that have been denied that. We proposed that we would stagger the 38 hour week. We would stagger the rostered days off to make it less hard on the company. We would accommodate the company in any way we could so that these people could take their rostered day off.

PN57

However, we hit a brick wall with the company. They are saying: no, we have an agreement in place, that is the company policy. Now, everybody comes into this company has to work a 40 hour week. We are not doing anything else. So that is how the matter was taken out of the EBA area. I believe it was going to be one major sticking point on formalising a suitable form of agreement because the workers are adamant they want to go back to a 38 hour week and to bring it up to here and notify the parties that we would be bringing this here plus the underpayment of wages that is tied up with the rostered days off, identification of the wages, to the Industrial Commission was a section 99 and that is front of you today, Commissioner.

PN58

THE COMMISSIONER: Yes, thank you, Mr Deakin. Mr Short.

PN59

MR SHORT: Thank you, Commissioner. Just by way of background in relation to the company and it's operations it might be helpful just to have a bit of background, if not simply for this application but for the 127 in due course. This company operates in South Australia, WA, Queensland and Victoria. In South Australia there are three areas of work all concerned with air-conditioning units. Only one of those areas is affected. There is about 20 employees engaged in manufacturing work covered by the Metal Industries Award and with an enterprise agreement in place.

PN60

There is 20-25 site installation employees under the Federal Plumbing Southern States Award and again there is a Federal enterprise agreement in place. The relevant section is about 20 service employees covered under the Federal Metal Engineering and Associated Industries Award 1998 and with no enterprise agreement. It is those service employees that are the subject of the dispute, the application. In respect of - - -

PN61

THE COMMISSIONER: What did you say in relation to their enterprise agreement?

PN62

MR SHORT: There is no enterprise agreement.

PN63

THE COMMISSIONER: There is no enterprise agreement.

PN64

MR SHORT: No. In respect of the section 99 application - - -

PN65

THE COMMISSIONER: Just before you go on, in relation to these service employees are there service employees in - what did you say, WA, Queensland and Victoria?

PN66

MR SHORT: Yes.

PN67

THE COMMISSIONER: Are there service employees in those states?

PN68

MR SHORT: Yes, there are.

PN69

THE COMMISSIONER: Do they have agreements?

PN70

MR PURDY: Not in Victoria, Commissioner. In Western Australia there is a remote area agreement. It relates to one of the branches in the mining area.

PN71

THE COMMISSIONER: Thank you.

PN72

MR SHORT: Yes, that is Mr John Purdy, the General Manager. Now, in respect to the application today, we understood that was about rostered days off. The matter about payslips, I can say to you I have no knowledge of that, that is news to me and we will see how far we can take that. It certainly wasn't a matter that we apprehended was being dealt with by the Commission or we needed to give any consideration to and I have not.

PN73

THE COMMISSIONER: Have you been asked many questions about the issue of payslips?

PN74

MR SHORT: None that I am aware of but I have come into this of recent times.

PN75

THE COMMISSIONER: What about someone who is aware of what has been asked.

PN76

MR SHORT: I am getting a shaking of heads, as you can see, Commissioner. In respect of the RDOs, now Mr Deakin has - I might also say though, perhaps to assist, the company did write to the union beforehand in respect of section 99 application to try and find out what it was about and it might be convenient if I provide you both with a copy of the letter the company sent and the union's response.

EXHIBIT #S1 LETTER DATED 19/09/2001

EXHIBIT #S2 LETTER DATED 20/09/2001

PN77

MR SHORT: You will see from the union's letter, Commissioner, that there was an issue raised of underpayment of wages and it is my understanding that the Commission is not being asked to deal with that, that that is being dealt with outside of the Commission and an issue about rostered days off.

PN78

THE COMMISSIONER: Perhaps if you could just be seated for a moment, Mr Short.

PN79

MR SHORT: Yes, certainly.

PN80

THE COMMISSIONER: Look, there are issues to do with this, if you just look through the letters. Mr Deakin, have you seen these letters before?

PN81

MR DEAKIN: Beg your pardon, Commissioner?

PN82

THE COMMISSIONER: Have you seen these letters before?

PN83

MR DEAKIN: Yes, Commissioner.

PN84

MR SHORT: Mr Deakin wrote the union's letter.

PN85

THE COMMISSIONER: Have there been any meetings with the company about this matter in relation to the payslips?

PN86

MR DEAKIN: The payslips?

PN87

THE COMMISSIONER: Yes.

PN88

MR DEAKIN: There was one taking place Friday - - -

PN89

THE COMMISSIONER: This Friday just gone?

PN90

MR DEAKIN: Just gone with Mr Vanis and we talked about the make up of the wages, there was something wrong with it, and I preferred to take that to one side on the wages and how it is made up. However, as we are here today, I think it is relevant we put it on transcript because I think the matter might be coming back again, simply because we couldn't get our points through but I will be taking with Mr Vanis after we have finished here, Commissioner, but I would just like to - - -

PN91

THE COMMISSIONER: I am going to set aside the matters that are raised because there has not been, in my view, adequate consultation to try and resolve this issue. Now, the detail that is in your letter and the detail that has come out this morning is something that the company will act on and will have a look at its records over. The fact that the company was not aware, obviously, from the letter of 19 September, which I have marked as exhibit S1, that there was a dispute over this matter I think shows that there was not sufficient consultation prior to this matter being listed. Now, I will assist the parties at any time any place after they have had meaningful discussions in relation to these matters and I still think the meaningful discussions have to occur.

PN92

Now, in relation to the issue of whether or not there is a 40 hour working week in place, perhaps then I will ask the company for a response on that but it might also be that I will deal with that matter in the same way but I will be - - -

PN93

MR DEAKIN: We have discussed the rostered day off, Commissioner, on many occasions and the company has come back: no, it is a 40 hour week, we are not going to back to a 38 hour week and that is it.

PN94

THE COMMISSIONER: Well, I want to hear the company's response just on that matter. It might also be that you confer over that if there is still some misunderstanding but I will hear from the company on that matter.

PN95

MR SHORT: Commissioner, it might also assist if I put before you the 1996 trial agreement. I think Mr Deakin filed it, an incomplete document, there's a second page to it.

PN96

THE COMMISSIONER: Yes, I see. All right.

EXHIBIT #S3 1996 TRIAL AGREEMENT

PN97

THE COMMISSIONER: I will note that that is the complete document.

PN98

MR SHORT: Yes, Commissioner. Now, you quite rightly identified, Commissioner, that that document was 1996 and it was a trial period of 1 year and that trial period has well and truly expired. Two employees currently are paid - currently work 38 hours, have rostered days off and are paid accordingly. The balance of the service employees actually carry out 40 hours of work. They are paid 38 hours at ordinary time as per the award, save that their rates of pay are over the award. They are also paid in respect of the 2 hours of overtime at time-and-a-half. That is, they perform 40 hours of work, they are paid for 41 hours of work. They are paid over-award rate of pay.

PN99

Under the award, Commissioner, clause 6.1.1(c), the ordinary hours of work have been worked continuously except from your breaks at the discretion of the employer between 6 am and 6 pm. So within the span of hours, if you like, the employer has the discretion as to when the hours are worked. If I could then invite your attention, Commissioner, to clause 6.4.2 which deals with the requirement to work reasonable overtime, under which an employer - - -

PN100

MR DEAKIN: What clause is that again?

PN101

MR SHORT: 6.4.2, under which an employer may require any employee to work reasonable overtime at overtime rates and the employee shall work overtime as required. Now, the employer is requiring the employees to work 2 hours overtime per week. Commissioner, Mr Deakin may be looking at 6.1.4.(a) and may have misinterpreted that clause. That deals with matters in which agreement might be reached including rostered days off but it commences:

PN102

Subject to the employers right to fix the daily hours of work -

PN103

within the spread of hours and also deals with shift work, but these are not shift workers -

PN104

subject to that the arrangement of ordinary working hours is to be by agreement.

PN105

But of course they key qualification is that the matters of agreement are subject to the employer's right to fix the hours. If however the employer chose not to fix them but to reach agreement then 6.1.4(b) would provide that rostered days off might be a matter on which agreement could be reached. There is no requirement for rostered days off. The employer finds that the nature of its business is such that the current work arrangements are much preferable. It enables service of clients, employees go out to various sites and provide service on site without the need for rosters. So the company does not have a desire to extend the availability of rostered days off. I can also provide you, Commissioner, with a copy of the standard application for employment so that Commissioner - - -

EXHIBIT #S4 COPY OF STANDARD APPLICATION FOR EMPLOYMENT

PN106

MR SHORT: Thank you, Commissioner. You will see that all employees on their application are asked and it is at the bottom of the front page:

PN107

Are you able to work reasonable amounts of overtime?

PN108

Ambitions have indicate yes.

PN109

THE COMMISSIONER: Sorry, where is basis at?

PN110

MR SHORT: At the bottom of the front page, you see the question:

PN111

Are you able to work reasonable amounts of overtime?

PN112

Then on the reverse side you will see at the bottom the employee's signature and if you go up about five lines you will see a line beginning:

PN113

Weekly Rate, and it has got $570 per 40 hour week. My instructions are that that is on there when the employee signs, that every employee is informed that they will be working for 40 hours and they understand what they will be getting paid. Now, while the award talks of 38 hours and reasonable overtime, there is no barrier to an employer saying, well, this is what I will pay you for these hours of work provided of course it is more than the award or at least not less than the award requirement in terms of pay. These employees are receiving as I say over the award rate of pay.

PN114

So my instructions are that what is in place accords with the award and accords with what has been advised to and agreed to each of the relevant employees. I understand that the weekly pay rate on the payslip and I can't take it very far but I understand that what has happened is that the 41 hours of pay have been divided so as to give an hourly rate spread across 40 hours actually worked. Commissioner, if that assists that is the company's perspective.

PN115

THE COMMISSIONER: Yes, thank you. I do have some sympathy with the issue that Mr Deakin has phrased in relation to the actual calculation.

PN116

MR SHORT: Yes, I can understand that and we have heard that today.

PN117

THE COMMISSIONER: The payslip regulations are quite specific in relation to that. Thank you. I think it might be useful if we went into conference on this matter.

OFF THE RECORD

ADJOURNED INDEFINITELY [11.57am]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #D1 COPY OF PAYSLIPS PN22
EXHIBIT #D2 AGREEMENT PN43
EXHIBIT #S1 LETTER DATED 19/09/2001 PN77
EXHIBIT #S2 LETTER DATED 20/09/2001 PN77
EXHIBIT #S3 1996 TRIAL AGREEMENT PN97
EXHIBIT #S4 COPY OF STANDARD APPLICATION FOR EMPLOYMENT PN106