C2001/339, Transcript of Proceedings [2001] AIRCTrans 750 (3 May 2001)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

BOULTON J

C2001/339

APPEAL UNDER SECTION 45 OF THE ACT
BY CFMEU AGAINST A DECISION OF
COMMISSIONER BACON IN MELBOURNE ON
19 MARCH 2001 IN C NO 41028 OF 2000
RE. TERMINATION OF A CERTIFIED AGREEMENT

SYDNEY

2.18 PM, THURSDAY, 12 APRIL 2001

ADJOURNED INDEFINITELY

PN1

HIS HONOUR: Can I have the appearances please?

PN2

MS C. HOWELL: May it please the Commission, I seek leave to appear for the appellants.

PN3

MR J.E. MURDOCH: If your Honour pleases, I seek leave to appear with my learned friend MS C.J. ARNOLD for the respondent, BHP Coal.

PN4

HIS HONOUR: Leave is granted in each case. My apologies for calling this matter on on Thursday afternoon before the Easter break. Mr Murdoch, not you have had to travel through the event. Ms Howell?

PN5

MS HOWELL: Thank you, your Honour. The matter is listed for the hearing of a stay application in relation to a decision of Commissioner Bacon of 19 March 2001 matter number C 41028 of 2000 which was an application by BHP for the termination of the Crinam Mine CFMEU Agreement 1997 pursuant to section 170MH of the Act. That decision to terminate the said agreement is appealed from by the CFMEU. Your Honour, the respondent to the appeal has just given me an affidavit of Mr Keith Glen Ritchie. The appellant did not have any intention to call any evidence on the stay application beyond matters which were before the Commissioner in the hearing.

PN6

I should say firstly that I would seek to cross-examine Mr Ritchie on some of the matters contained in the affidavit about which I do have instructions, however, because the affidavit was handed to me immediately not immediately but shortly before the commencement of the hearing there are some matters about which I have not been able to obtain instructions which does cause a little bit of difficulty at least if your Honour was disposed to rely on those particular matters as being weighty matters as to whether your Honour would grant a stay or not.

PN7

HIS HONOUR: I haven't seen the affidavit and I don't know what's raised by it and to what extent I would be relying on whatever is in it.

PN8

MR MURDOCH: I had been about to get to my feet to indicate to your Honour that we do have it and to seek leave to read and file it and present Mr Ritchie for cross-examination. It goes, your Honour, to matters directly relevant to balance of convenience and consequently it is important to our case that it be before your Honour. As to the matter of it being handed to my learned friend just before the hearing with the best will in the world, your Honour, we were unable to do any better because Mr Ritchie is based in central Queensland. We met him in Sydney this morning and he swore his affidavit not long before it was given to my learned friend.

PN9

We were only advised of the listing of this matter some 48 hours ago. I'm not complaining about that, your Honour, but as I indicated with the best will in the world the taking of instructions, the arranging for him to attend, the preparation of the affidavit meant that we weren't able to give the courtesy that we would normally endeavour to give. Having said that, your Honour, the matters contained in it would I would suggest not be matters of great surprise to my learned friend's clients. Your Honour is in the difficult position where you don't have it. Might I hand the affidavit up and in a formal way seek leave to read and file. It's the affidavit of Keith Glen Ritchie sworn today.

PN10

MS HOWELL: Your Honour, I didn't intend to criticise the respondent for the lateness of service but I did intend to point out the forensic disadvantage that creates for my clients. I don't accept my learned friend's contention that these matters are all matters which would not come as a surprise to my client.

PN11

HIS HONOUR: Have you got any objection to the tender of the affidavit?

PN12

MS HOWELL: Yes, I do have to object, your Honour, just on the basis that not having had instructions on the contents I'm not in a position to cross-examine fully on that and it does create a difficulty because of the possibility that your Honour might be disposed to give some weight to some of the matters which are deposed to.

PN13

HIS HONOUR: There's a number of possibilities. It's fairly unusual for evidence to be sought to be led in a hearing of stay applications. In fact I can't recall one that I've dealt with where evidence has been sought to be adduced. The applications are usually dealt with rather expeditiously on the basis of submissions from the parties. I say this having not had the opportunity of reading the affidavit and it's not appropriate for me to read it at this stage if there is a possible objection which I'm going to have to hear to its tender.

PN14

There would be a number of options. We could adjourn the proceedings so as to allow you to get instructions. That might be on the basis that some understanding between the parties as to what might prevail in the mean time. We will adjourn it until next week although if the matter is to be called back on in Sydney I wouldn't be available in Sydney until possibly the Friday but I would be available in Brisbane because I have other matters in Brisbane. Alternatively, we can proceed as far as we can today and leave the rest of it to some other time or I can hear whatever application you're going to make, Ms Howell, in relation to how I should proceed. So, I really would like to hear from the parties as to how you propose I should proceed in the circumstances.

PN15

MR MURDOCH: Your Honour, might I very briefly deal with some particular features which arise as to the balance of convenience in this matter.

PN16

HIS HONOUR: Do I take it that you're proceeding to put an argument as to why I should admit this document?

PN17

MR MURDOCH; Your Honour, I don't want to be presumptuous in the light of your comments, but it is, I think, relevant for you to understand a contextual matter. The context is that in Commissioner Bacon's decision of 19 March, the - - -

PN18

HIS HONOUR: I just don't want to let you go too far because it isn't your application.

PN19

MR MURDOCH: I understand that, your Honour, but it's relevant to why I would like to put some material on. The relevance is, and I won't abuse the privilege, the relevance is that the Commissioner's order arising out of the decision said that the termination of the agreement was to come into force from midnight on 7 April 2001. The decision was on 19 March. The appeal was filed on 6 April, and we were not aware of the matter until 48 hours ago. So what the affidavit deals with were the practical steps that my clients had to take between 19th and midnight on 7 April to gear up for the conversion from certified agreement to an award based set of employment conditions.

PN20

The affidavit deals in large part with the considerable steps that my clients had to take towards the smooth transition, the fact that the transition has now taken place and the difficulties which will now occur should your Honour impose a stay, and there are particular elements which arise out of the fact that at this underground mine employees work to a roster system that covers a period of weeks, and consequently it is difficult without considerable chaos to change horses in mid stream.

PN21

Your Honour, I agree that in a normal case the parties wouldn't be putting on material. However, in this case, there is the peculiar circumstance that arose out of the terms of the Commissioner's order, the necessary steps that had to be taken arising out of it, and the consequences which would flow back if a stay is now granted, and they are matters that go directly to balance of convenience. So, your Honour, so far as our case is concerned, we press the tender. If it means the matter being held over to perhaps Tuesday when your Honour is in Brisbane, well, that may be the price we pay to enable my learned friend to get instructions.

PN22

HIS HONOUR: Well, Ms Howell?

PN23

MS HOWELL: Your Honour, firstly I should say the affidavits certainly cover a range of issues going far beyond what my learned friend has suggested, that's one component of it. Secondly, as far as I apprehend the material, it suggests that some changes are going to come into effect on the 15th. Whilst I appreciate that some steps must have been taken in the interim, it's not a question of a fate accompli which has already been put into place, which has already been enacted and effected which we are talking about here.

PN24

The difficulty of adjourning the matter, I suppose, is that it gives the respondent the opportunity to put into place those changes and then face the appellant with an argument, well, now we really have implemented these changes it's all the more difficult to turn them around. We don't say that any of the changes would cause any difficulty in reversal in any event, but that's no doubt a submission which we would be faced with if an adjournment was granted to enable the appellant to get proper instructions on some of these matters. I don't think there's anything further I can say, your Honour. We press the objection.

PN25

HIS HONOUR: The objection you press is that I should not admit this material?

PN26

MS HOWELL: Yes, your Honour, that leave should not be granted for the tendering of the material. I should also say though that Tuesday is not a convenient day for me.

PN27

HIS HONOUR: I'm not sure about what you said might happen on the 15th; you said certain things were going to be implemented on the 15th?

PN28

MS HOWELL: Your Honour, I apprehend from the evidence which is sought to be filed that certain changes in various arrangements that apply at the mine would come into effect on the 15th. The appellants case is that none of those changes would cause any significant difficulty in reversal in any event, but it be argued against us that those changes having come into effect is a further factor on the grounds of convenience.

PN29

HIS HONOUR: Mr Murdoch, what do you have to say?

PN30

MR MURDOCH: The position is that a range of changes have already been implemented, I'm instructed, in accord with the terms of the Commission's order. There's another change in relation to some transportation, some bus arrangements from one of the centres where employees reside, and it's true that's to come into effect on the 15th, and there are some rostering changes which have been the subject of extensive organisation which are to kick in on the 15th, but frankly in relation to those, your Honour, our view is that with the preparation which is necessary in rostering staff, we have already passed the point of no return, and I don't say that in a way that assumes anything, but this an underground mine that works on a seven day a week basis with quite a sophisticated rostering system involving both supervisory production and maintenance personnel, and with respect, your Honour, given the day being Easter, it is a case where we have passed the point of no return, so the difference between today and Monday in our view is not of any practical consequence.

PN31

HIS HONOUR: Why can't these issues and problems simply be alluded to in your submissions. Why do they need evidence? Normally in these sort of matters, the practical problems that might be caused by the granting of a stay are dealt with in submissions. It's unusual for, I mean, there might be debate about those practical problems, but there isn't usually a challenge to the actual making of submissions about them.

PN32

MR MURDOCH: Your Honour, given the time we have already devoted to this and having respect for your Honour's advice in relation to that, I would be prepared to proceed on the basis that I'll deal with those issues as part of my submission. However, if it becomes an issue where I'm saying black and my learned friend is saying white, we might have to then return to the matter of settling it by means of evidence, but we may not get to that.

PN33

HIS HONOUR: Yes, Ms Howell?

PN34

MS HOWELL: Does your Honour have the notice of appeal?

PN35

HIS HONOUR: Yes.

PN36

MS HOWELL: I turn first to the issue of whether the appellant has an arguable case on appeal as that's one of the two factors which would be regarded as relevant. I don't propose to take the Commission to all of the grounds on appeal but I do want to select a number of those grounds. I take the Commission first to ground 3.

PN37

It's a contention of the appellant that the Commissioner failed to take into account an extremely significant matter in that the termination of the agreement was likely to lead to an increase in stoppages of production, in circumstances where the respondent itself had put forward evidence to prove that stoppages of work, whatever the cause, generated significant safety risks, so it was submitted before the Commissioner that the effect of terminating the agreement would be to increase stoppages and consequently to increase safety risks to people working in the mine.

PN38

The relevant evidence that the respondent, BHP, relied upon before the Commissioner was the affidavit of Daniel Allan Payne which is tab 8 of the Appeal Book. It's a relatively short affidavit, your Honour, and I would take the Commission to it. I take the Commission to paragraph 8 of Mr Payne's affidavit. Mr Payne is, in essence, a person with some technical expertise. He gives his professional opinion, supported by the history of Crinam mine, that the likelihood of a roof collapse is significantly increased where there has been a stoppage for whatever reason in long wharf production.

PN39

In paragraph 9 he gives further evidence to the same effect. Mr Ivanoff, the Crinam Lodge secretary, also gave evidence in the proceedings. He gave evidence and this is at tab 16, paragraph 42, that the step of terminating the agreement would be regarded by the membership as extremely provocative, and it would be highly likely that there would be further industrial action in support of a new agreement, and that the general industrial climate at the mine would be severely damaged.

PN40

Mr Ivanoff was not challenged on that evidence and the submission that was made was on the basis of that unchallenged evidence, the likelihood was that the termination of the agreement would result in increased likelihood of industrial action and on the basis of BHP's own evidence, increased dangers of roof collapse as a result of any stoppages which might occur. Now that's clearly a matter which in the public interest, in our submission, the Commissioner should have taken into account.

PN41

It was adverted to in some detail in the submissions but it wasn't taken into account, and we say that is a fundamental error on the part of the Commissioner. A further ground of appeal which I wish to draw the Commission's attention to is ground 4, which is the allegation by the appellant that the respondent, BHP, was making the application to terminate the agreement for an improper purpose. The evidence on which the appellant relied below were two media releases, which were annexures to Mr Ivanoff's statements and I must say do not appear to be reproduced in the book, but also the statement of Peter Howlett which is the very last tab, tab 17.

PN42

Mr Howlett is the Vice President of the Crinam Lodge and he deposed to a conversation he had with Mr Ritchie of BHP where Mr Ritchie said words to the effect of:

PN43

You have got the right to have protected action to go on strike. We have got the right to cancel your agreement. The main reason is so that we can take away the rights to strike under protected action.

PN44

That was in response to a question as to why BHP was taking the step of seeking to cancel the agreement. The Commissioner seemed to form the view that the step of taking, of cancelling the certified agreement would not have the effect of preventing the CFMEU from taking industrial action, and no doubt that's correct. However the submission was that the purpose of BHP in making the application was an improper one, and because of that the application should not be acceded to.

PN45

His Honour didn't properly consider the doctrine of improper purpose which is discussed in a large number of authorities, but essentially is to the effect that if an application to a court or tribunal is made for a purpose other than that for which the statute is designed, than it is for an improper purpose and would not be permitted. That proposition is discussed in such cases as Williams v Pautz [1992] HCA 34; (1992) 174 CLR 509, so that's a further ground which we would rely on. There was another matter about which the appellant's made some submissions and which is of some significance both in terms of balance of convenience and arguable case and that is the question of shift arrangements.

PN46

HIS HONOUR: If you cancel the agreement, why would it take away the right to take industrial action which was protected action?

PN47

MS HOWELL: We don't say that it would, your Honour, but we say that senior management of BHP expressed the view that it would and expressed to CFMEU officials that the purpose of making the application was to achieve that objective, and that's why we say regardless of whether the view was correctly held or not, the application was made for an improper purpose.

PN48

HIS HONOUR: But the application is incapable of achieving that improper purpose.

PN49

MS HOWELL: That's so, your Honour, but we say that doesn't matter, the question is whether the purpose is one which the statute contemplates or not. There's a further important issue, your Honour, and that is the issue of shift arrangements.

PN50

HIS HONOUR: But surely with the improper purpose test, there must be some coming together of the improper purpose and what's achieved by, as it were, success in an application.

PN51

MS HOWELL: Not necessarily, on the authorities, your Honour. It's really in the nature of a concept of abuse of process. The courts have said that they wouldn't contemplate their processes being used for purposes for which they were not designed. The question of shift arrangements is an important one both with respect to the arguable case and the balance of convenience. The situation is that the certified agreements permitted shifts of 12 hours whereas the terms of the award, and I don't have copies but perhaps I'll just read the relevant terms.

PN52

HIS HONOUR: It allows 10 hours.

PN53

MS HOWELL: 10 hours, thank you. There was much evidence before the Commission.

PN54

HIS HONOUR: I think it's 10 hours and, further, with agreement.

PN55

MS HOWELL: That's so, with agreement or by order of the Commission, 10 hours can be exceeded. The arrangements in place were for a range of shifts including 12 and three quarter hours and I think a minority of workers on 13 and three quarter hour shifts. The union has indicated it's intention to revert to the award provisions with respect to shift times because, colloquially, all bets are off once the agreement is cancelled. As I'm instructed, there have been no changes by the company to those shift arrangements to date, even though the award is now in place.

PN56

At the time that the company made the arrangements in the knowledge that the effect of its application was that the award's shift provisions would apply, it had taken no steps to consider how it was intending to accommodate the award provisions with respect to maximum shift length and this is evidenced on the transcript, which is tab 3, at paragraph PN459. At the very time the respondent was making the application there was some rather clumsy cross-examination by myself immediately before Commissioner Bateman interceded and said:

PN57

Perhaps we can cut some of this short. Mr Taylor, what roster are you going ...(reads)... we will wait and see what happens at that time.

PN58

So, in other words, the respondent simply hadn't determined, hadn't even discussed with the union what arrangements would apply once the situation reverted to the award where the 10 hour shift would be the maximum. Certainly there was, and is, no agreement with a majority of the workers concerned that anything other than the award provision would apply. The first point is that the Commissioner didn't have regard to this in considering whether it was in the public interest that the agreements be terminated and the second point is that even to date, no arrangements have been made to accommodate the award provisions with respect to shifts.

PN59

The unions position, as I'm instructed, is that it does not consent to any deviation from the award provisions should the decision to terminate the agreements remain on foot. So we have a situation where, if the stay is not granted, the company is proceeding in breach of the award by requiring shifts which were in excess of 10 hours. It would also be noted that the evidence of the company was overwhelmingly to the effect that it required shifts in excess of 10 hours and seems to have proceeding on the assumption that what the company wants will, in fact, be delivered to it by some process unknown.

PN60

HIS HONOUR: That's a matter that you say goes to balance of convenience and arguable case.

PN61

MS HOWELL: Yes, your Honour, because it was fact on which we say the Commission should have had regard to but apparently did not.

PN62

HIS HONOUR: But it would seem to me, at least on the face of it, that the company is restrained by the terms of the award if,indeed, it's seeking to do what you suggest, and that is to have shift arrangements which aren't in compliance with the award provisions.

PN63

MS HOWELL: Your Honour, as we apprehend the position, the company is proceeding on that basis, that it is not so constrained.

PN64

HIS HONOUR: But it's not the sort of matter that you would usually grant a stay to restrain, it's a matter which, as it were, is dealt with by virtue of the award arrangements.

PN65

MS HOWELL: Well, your Honour, it is not just a matter of breaching the award. It's a matter of, we say, the company should be assumed to be prepared to comply with its legal obligations with respect to the award. Now what that means is that the company will be required to revert to the 10 hour arrangements, albeit belatedly and should the appeal be successful, then there will be a further aversion to the longer shifts. Now that's where the balance of convenience comes in.

PN66

We are going to have to revert to 10 hour shifts and then, if the appeal is successful, go back to the old shift arrangements. That's disruptive. I'm not going to come here and complain about disruption to BHP, but it's certainly disruptive and uncertain as far as the members go. Your Honour, we also say that the Commissioner erred in failing to take account of and to give proper weight to the substantial unfairness and disadvantage to employees arising from the termination of the agreement.

PN67

Commissioner Bacon, in his decision at paragraph 14, reproduces a letter which was tendered by BHP. The letter could be regarded, I suppose, as a statement of intention on BHP's part at it's highest to continue with some of the benefits which flowed to employees arising from the certified agreement. Now, your Honour, we make some criticisms of the latter and we also rely on these in our grounds of appeal, in that BHP reserves its rights to change any of these terms and conditions consistent with the award.

PN68

Not only, as Commissioner Bacon inferred, if there was some untoward event, but in any circumstance when BHP wanted so to do. But more importantly, for the purpose of the stay application at least, the significant components of the employees' remuneration which is not in any way protected by this undertaking is the bonus scheme which is provided for under the certified agreement, which Mr Ivanoff gave evidence, is worth approximately $18,000 per employee per annum.

PN69

Now tat is a factor to which we say his Honour should have had regard, the fact that the termination of the agreement had the potential to affect that bonus in circumstances where the respondent, BHP, had provided a letter of intention which expressly excluded any reference to a bonus which is worth about $18,000 a year. Now there's a couple of things which could be said about that. Firstly, we do say that there is a public interest consideration arising from very substantial reductions to employee's remuneration and I think there's some support for that proposition in the authorities, including Munro J's decision in Joy Mining.

PN70

But a significant point in terms of the appeal is that Commissioner Bacon appears to have proceeded on the basis that the employees' remuneration was substantially protected by this letter of intention, when in fact clearly it wasn't because the bonus is a very substantial component of that remuneration. Your Honour, as I'm instructed, what the employees have been told about the bonus is that the bonus scheme will remain in force until a revised bonus scheme is developed, which could be any time in the future.

PN71

Of course, that revised bonus scheme is entirely at the discretion of the respondent, not being provided for in the award. So that's the situation with respect to bonus.

PN72

HIS HONOUR: That's not covered in the letter, the bonus scheme?

PN73

MS HOWELL: No, your Honour, it's a very conspicuous omission.

PN74

HIS HONOUR: Where was this other undertaking given?

PN75

MS HOWELL: The undertaking in paragraph 14, your Honour?

PN76

HIS HONOUR: No. You say there's some undertaking or arrangement in regard to the bonus scheme.

PN77

MS HOWELL: Your Honour, a letter has gone out to employees which, amongst other things as I'm instructed, does say that the bonus scheme will continue to operate pending the finalisation of a revised scheme. It doesn't say at the discretion of the employer, but clearly that's the case.

PN78

HIS HONOUR: Well was this issue raised before the Commission?

PN79

MS HOWELL: Yes, your Honour. Your Honour, it's paragraph 1052 when we are in submissions.

PN80

HIS HONOUR: Well isn't it covered - in his decision he says:

PN81

There remains other conditions in the agreement which are not the subject of any undertaking. The loss of those conditions needs to be considered

PN82

This is at the end of paragraph 16.

PN83

MS HOWELL: Yes. Your Honour, I don't read "conditions" as referring to bonus. But in any event, it's not clear what the Commissioner is referring to. You see, it's not really consistent with the earlier sentence to regard that as referring to bonus, because it says here in paragraph 16, the third sentence, that:

PN84

The letter demonstrates an intention of BHP not to significantly, if at all, reduce employee remuneration

PN85

It's not consistent with that, to think that the later sentence refers to the bonus because in our submission, the absence of any undertaking with respect to the bonus does signal a likelihood that the bonus scheme is going to be revised.

PN86

HIS HONOUR: Where is it in the submissions?

PN87

MS HOWELL: The submissions at paragraph 1052. Secondly, your Honour, in the proceedings there was no suggestion that any scheme of any comparable magnitude would be put in place to replace the existing system, it has to be said.

PN88

HIS HONOUR: That's where you refer to paragraph 42 and he seems to have referred and set out that paragraph .....

PN89

MS HOWELL: Your Honour, we would submit that nothing in the Commissioner's decision suggests that he's taken into account the very substantial disadvantage effected by the loss of the bonus scheme and his comments to the effect that it appears that BHP had no intention of significantly reducing remuneration would suggest that that bonus was not a factor to which the Commissioner either turned his mind or alternatively gave sufficient weight.

PN90

With respect to the strength of the appellant's case, there's only one factor which I really want to touch upon and that is the fact that the Commissioner in his decision - this is with respect to good faith bargaining, places some weight on events which have occurred since the date of the hearing and the date on which submissions were made. This starts at paragraph 23 and goes on through paragraphs 24 and 25. There were some further negotiations, that's undoubtedly true but on my instructions, the appellant would have wished to make some submissions as to whether, in the course of those negotiations, the respondent was negotiating in good faith and there is no question on the basis of the authorities that the question as to whether a party is negotiating in good faith is relevant to the public interest test.

PN91

The Commissioner has taken into account those negotiations in finding that the respondent did negotiate in good faith without giving the CFMEU the opportunity to be heard on the weight that should be given to those factors and indeed on the - to present any evidence it may wish to do as to those matters. So, that point is a simple natural justice point, but we say, a compelling one because a decision which is vitiated by natural justice by a failure to grant a party natural justice, would ordinarily be overturned irrespective of whether in fact, the result would have been altered.

PN92

It is obviously not possible to say in the present case whether the Commissioner would have come to a different decision had the CFMEU had the opportunity and taken the opportunity to put on evidence and submissions as to those matters. It may have done and it may not have done but in any event, it is a denial of natural justice which is a substantial one because it would appear that some weight was given to those matters in the Commission reaching its decision. We say, that the appellant has a strong case on those grounds and others as to why the decision of Commissioner Bacon should be set aside.

PN93

HIS HONOUR: The sequence of events was that the application for the termination of the agreement was heard and those hearings included on 30 October and then after that there were a series of negotiations between the parties, some of which were convened by the Commission and those negotiations didn't lead to an agreement being made and on that basis, on 19 March and without, as it were, calling the matter on again for further submissions, the Commissioner announced his decision.

PN94

MS HOWELL: That is so, your Honour, that's my understanding.

PN95

HIS HONOUR: And he took into account, what had taken place between the time that he concluded the formal submissions.

PN96

MS HOWELL: Yes, your Honour. One would have thought that he would have been in a rather good position to make an assessment of that matter on the basis of his participation in the conferences between the parties.

PN97

MS HOWELL: He didn't participate in all of the meetings which occurred but notwithstanding that he was in that position, the CFMEU was entitled to be heard on whether any of the conduct of the respondent effected the CFMEUs submission that the respondent did not bargain in good faith. It has to be said, your Honour, that there was a lot of evidence led by the CFMEU on the issue of lack of good faith bargaining which I don't need to take your Honour, but it essentially went to a very abrupt last minute change in the respondent's position.

PN98

It was an important submission which the appellant put below based on this - what we said was in substance the respondent walking away from the product of some long term negotiations and certainly the CFMEU would have wanted to be heard further as to whether the conduct of the respondent subsequent to the hearing in any way, altered that position. Your Honour, with respect to the balance of convenience, we do say that the alterations to roster arrangements which are required by the award and which the respondent apparently has taken no steps to introduce thus far, are a very significant consideration.

PN99

There are also other changes which are - will cause some difficulty if they have to be implemented and then the agreement comes back into operation. Those include the last on, first off principle which I think I'm right in saying, is in the agreement but not in the award in terms of redundancy. There are also some, not only changes to the bonus scheme which could be introduced at any time but also changes to the remuneration - I withdraw that. I think perhaps in light of the fact, I suppose the general presumption would be that the agreement having been in place for well in excess of two years and an appeal presumably not being too far off in the absence of any strong reasons to the contrary, a stay would ordinarily be granted, so that the status quo can remain until the matter is resolved on appeal. Particularly having regard to the strength of the appellant's case and the substantial changes to rosters which would be required if the award is to be applied. Beyond that I think it is really a matter for Mr Murdoch to address other issues and I would endeavour to deal with those in reply. If it please your Honour, that's all I wish to say on the question of the granting of a stay.

PN100

HIS HONOUR: Thank you, Mr Murdoch?

PN101

MR MURDOCH: Commissioner, I have a precis. It is only two or three pages long. It deals with the relevant principles. I don't intend to read it out aloud but I thought it might assist your Honour having regard to the day and the time. In so far as the principles are concerned - - -

PN102

HIS HONOUR: I will mark it exhibit M1.

EXHIBIT #M1 PRECIS OF RELEVANT PRINCIPLES

PN103

MR MURDOCH: Our case is that the matters which my learned friend has addressed do not raise an arguable appeal case and further to that, none of the matters which she has raised are matters which for section 45 purposes, raise a prima facie case that would satisfy the public interest requirement. Further to that your Honour, we contend that the balance of convenience lies very strongly against any stay of the Commissioner's order and I will deal with that in a little more detail. Commissioner, so far as the background to the matter is concerned, I would ask you to note that the nominal expiry date of the certified agreement was 16 October 1999. The Commissioner's order made on 19 March 2001, came some 17 months after the nominal expiry date of the agreement.

PN104

It also came in circumstances where the record contains detailed evidence going to the reasons why the agreement is no longer appropriate for my client's business at Crinam mine. For example, in tab 6 there is the affidavit of Keith Glen Ritchie, BHP 2 and I would refer you to paragraph 18 commencing on sheet 5 and running over to conclude on sheet 9. Again I won't read it all, but refer your Honour to it because it was evidence that put before the Commissioner a very strong basis to ensure that there was no means by which any public interest against the termination of the agreement could be developed. Your Honour, for practical purposes my clients have on the record substantial issues which they put forward as obstacles to the efficient conduct of the business and we deal with clause 7, employment security, clause 16, the roster system, clause 23 sick leave, clause 41 demarcation,

PN105

clause 42 engagement of contractors. Your Honour, while I have that reference open, can I take you into the reference in sub-paragraph B on sheet 6, to clause 16, the roster system, and I do so for the purpose of clearing up some matters, which with respect to my learned friend are misconceptions. The plain facts are your Honour, that the parties have, since 10 April 2000, by agreement, departed from the hours provisions in the certified agreement.

PN106

The details of that agreement, we set out on sheet 6 and 7 and I emphasise that the arrangements that were in place at the time the Commission terminated the agreement were not arrangements as to rosters and hours that arose out of the certified agreement, the parties having abandoned them as early as April 2000. That agreement, your Honour, the April 2000 agreement is annexed as RGT2, to Mr Taylor's affidavit which is at tab 7 of the appeal book. Again I won't read it your Honour, but it deals with the departure that the parties put in place. Your Honour, the clients have been in a situation where they have since 16 October 1999 had their business impeded by provisions in the agreement which they resisted and which they endeavoured to negotiate their way out of. The negotiations failed.

PN107

There is in my submission, quite a compelling case that was before the Commissioner below, which was a case very clearly against any public interest consideration being enlivened so as to frustrate the statutory imperative, which is an imperative which requires the Commission to terminate the agreement once it has reached the nominal expiry date. It if only if that public interest consideration is enlivened, a consideration in which there is a public interest contrary to the agreement being terminated. That's the only circumstances in which the agreement is not to be terminated. Now, your Honour, the Commissioner had before him, in my submission, a very strong case in relation to the balancing of factors insofar as the company's interests were concerned. As against that there was no factor developed either before the Commissioner or by my learned friend this afternoon to demonstrate where the public interest is supposed to arise.

PN108

Even if the matters that my learned friend referred to this afternoon are based on substance, and we contend they're not, none of them enliven the public interest. None of them go to factors which, if the Commissioner had given them all the weight that my learned friend contends that they should have been given, would've given rise to the Commissioner being freed from the obligation that the statute imposes on him to terminate the agreement.

PN109

The matters that my learned friend raises, Commissioner, might go to the respect of interest of the parties but the respect of interest of the parties are on the authorities which we are referred to at the conclusion of our synopsis of authorities. Those matters are not synonymous with the public interest. There is nothing in the matters that my learned friend has raised with you to indicate that in any way the Commissioner failed to have regard to a relevant public interest consideration which impeded the statutory obligation imposed on him that required him to terminate the agreement.

PN110

Your Honour, might I hand up a copy of the decision of Munro J in the Joy Mining case that is in print T1133. I take your Honour to page 7 paragraph 27 which deals with the public interest in which his Honour quoted earlier authority including High Court authority and then adopted the statement of principle. Further, at page 10 paragraph 38, the whole of the paragraph is relevant your Honour but might I read the last sentence where his Honour says:

PN111

The more fundamental considerations relevant to the public interest must be those which have the most substance to what are perceived to be the interest and welfare of the community.

PN112

In paragraph 40, might I read the sentence commencing on the fourth line:

PN113

Regrettably though it may be, the parties' inability to secure agreement and the remoteness of there being likely to do so does not of itself generate a public interest in whether or not the expired agreement should be terminated.

PN114

And near the foot of that page, four lines from the bottom:

PN115

It is sufficient that the Commission finds that the effect of termination of the agreement is not contrary to the public interest.

PN116

On page 11, paragraph 42, I commend the whole of the paragraph to your Honour, however, having regard to the submissions of my learned friend this afternoon, I commend to you the last two sentences which read:

PN117

Something additional to the simple loss of those conditions is necessary to excite a public interest about the loss of particular conditions at enterprise level. I consider that such a public interest might be generated if the termination of an agreement were to divest crude rights to a significant degree. Other instances might be conceived.

PN118

Then on page 12 at paragraph 46, the first sentence:

PN119

In the circumstances and notwithstanding the manifest difficulty that confronts Joy in resuming normal operations, I do not consider that an adverse effect ...(reads)... in accordance with the Act.

PN120

Page 14 of the Joy decision, the paragraph that ends at the top of the page is relevant. Paragraph 53 in the Joy decision deals with the allegations that were raised in that matter about the company not acting with good faith and the dot points describe the case that was run against the company there. The final dot point at the top of page 15 being an allegation that Joy was not consistent in its negotiating position it switched and altered the demands made and the positions agreed to. It had raised new issues after matters had apparently been settled etcetera.

PN121

In paragraph 55, Munro J says, and this is on page 15:

PN122

It is sufficient to indicate that my conclusion about Joy's failure to bargain in good faith is based upon several circumstances. ...(reads)... with its bargaining position, industrial and related conduct.

PN123

Page 17 at the conclusion of paragraph 61 his Honour said and I quote:

PN124

It would be contrary to the public interest to set aside subsisting conditions for the benefit of the party ...(reads)... to reach a replacement agreement.

PN125

Now, your Honour, in the present matter there is no such scenario of allegations that can be made against my clients. Indeed the position is that our clients were involved in more than 40 meetings at enterprise level for the purpose of attempting to negotiate a replacement certified agreement. Many of those meetings were full day meetings and Commissioner Bacon chaired the meetings on 31 October and 1, 2 and 3 November 2000.

PN126

The submissions by Dr Jessup who appeared for my clients in the hearing below dealing with this from paragraphs PN981 on and the relevant paragraphs go through and include PN985 and in those paragraphs Dr Jessup put forward in my submission a strong set of contentions which rebutted any suggestion that there had been a failure to negotiate in good faith.

PN127

Your Honour, it's probably convenient to proceed on to the point that my learned friend raises as her natural justice point. There's no substance in that argument your Honour. Firstly, because there's authority closely on point that establishes that my learned friend's proposition is a flawed one and secondly, having regard to the particular facts of this matter there's no substance in the facts to support it in any event.

PN128

Your Honour, there's a little glitch in the system here but what I want to refer to is a decision in print R5283, the Full Bench of the Commission, the President Giudice, Senior Deputy President Polites and Commissioner Lewin, 27 May 1999, the glitch is your Honour I thought we had copies for you and my learned friend, unfortunately we don't seem to but I'll make my copy available to both of you as soon as I've used it.

PN129

What occurred there was that the appellant AWU submitted that it had been denied natural justice in the proceedings below because the Commissioner took into account his own knowledge of issues which had arisen and industrial action which had occurred on the project. Reliance was placed in particular on a paragraph from the Commissioner's decision which is set out and I'm reading from paragraph 5. In paragraph 10 of the Full Bench decision the Full Bench said this and I quote:

PN130

We are concerned that allegations of a denial of natural justice has been made. We accept that inasmuch as the Commissioner took into account industrial action ...(reads)... dealing with industrial disputes on the project.

PN131

Paragraph 13 the bench said among other things:

PN132

His decision to issue the order was reasonably open to him ...(reads)... industrial disputation on the project.

PN133

Your Honour, the situation is that we have a comparable situation here. Commissioner Bacon had been intimately involved in this matter, indeed he had as I referred you to earlier chaired a series of conferences between the parties. He had also in February 2001 prior to this decision chaired a conference of the parties whereby he endeavoured through conciliation at state level with the officials of the company and the unions involved endeavour to make a last ditch attempt to achieve a resolution of the matter, that again failed. So the Commissioner had conduct that put him directly into the bargaining conciliation process and it was relatively contemporary.

PN134

Now, so far as the Commissioner's decision goes it's not as if the Commissioner's decision after many months of delay dropped out of the sky. In fact what occurred, and I'll tender the correspondence, was that on 26 February my instructing solicitors wrote to the associate for Commissioner Bacon and copied in Mr Vickers, the President of the Queensland District Branch of the CFMEU Mining and Energy Division and the terms were that:

PN135

We confirm that we act for BHP Coal in relation to its application to terminate ...(reads)... issue his decision in respect of this matter.

PN136

Now that was on 26 February. There was a period then which elapsed before the Commissioner's decision came out on 19 March. Your Honour, this is not a case where anyone suggests that the Commissioner had been told something by somebody in a coffee shop and he then went away and took it into account. To use the expression of the Full Bench in the Walsley case this was a matter of shared knowledge.

PN137

There was in my submission, every reasonable opportunity for my learned friend's clients, in the period from 26 February 2001 up to 19 March, whereby if they had a request to be heard in relation to events since the submissions in the case have been concluded, they could have asked for it. In my submission, when a reasonable practical approach is taken, and having regard to the state of shared knowledge, that was a course that was reasonably open, there is in my submission, no basis upon which, on appeal, the Commissioner's decision can be challenged on denial of natural justice grounds. So that, in my submission, that plank in my learned friend's argument is one that does not assist her case.

PN138

May I tender the correspondence that I referred to. I will also hand up the Full Bench decision in the Wolseley matter that I referred to before, your Honour, and I apologise for the fact that it's got highlighter and markings on it.

PN139

HIS HONOUR: Yes, I will mark the correspondence, exhibit M2.

EXHIBIT #M2 CORRESPONDENCE

PN140

MR MURDOCH: Moving on then, to another of the grounds argued by my learned friend, the matter of bonus is one which the material in the appeal book suggests was, while not expressly referred to by the Commissioner, certainly a part of his considerations, in that the Commissioner at paragraph 16 dealt with the company's undertaking. He also recognised that on the material before him, the undertaking was genuinely given and in the absent any untoward event, would be honoured. Your Honour, that is a finding which I would submit until such time as an appeal court sets it aside, ought to be treated as prima facie correct.

PN141

However, his decision also recognised that there might be other conditions that would be lost and that appears in the last sentence of paragraph 16. His Honour, clearly turned his mind to the possible loss of conditions and we see this from his proceeding from paragraph 16 to a comment in paragraph 17 on the legislative scheme and the fact that there is a safety net award and then, very significantly, to an adoption of paragraph 42 of Munro Js decision in the Joy case. Then, in relation to matters flowing out of the Munro analysis in Joy, his Honour proceeded to paragraph 19 and made the finding that there was no evidence that accrued rights of employees will be divested to a significant degree if the agreement is terminated.

PN142

Your Honour, so far as bonus is concerned, as indicated by my learned friend, there is correspondence which my clients have sent to members of the work force, and I would hand up a copy of it. This is a letter of 3 April 2001 and I believe it is the letter to which my learned friend referred.

PN143

HIS HONOUR: Exhibit M3.

EXHIBIT #M3 LETTER DATED 03/04/2001

PN144

MR MURDOCH: Might I pause for a moment to give your Honour a chance to have a look at it.

PN145

HIS HONOUR: Yes.

PN146

MR MURDOCH: Your Honour, so far as bonus is concerned, my learned friend overstates the situation when she contended that the bonus could be removed at any time. Your Honour, that's not the tenor of the correspondence to the employees.

PN147

HIS HONOUR: But this letter is subsequent to the decision.

PN148

MR MURDOCH: Yes, that's right.

PN149

HIS HONOUR: The point that was being made as I understood it, was that the Commissioner failed to take into account, or failed to give sufficient consideration to the fact that employees might lose the benefit of the bonus arrangements.

PN150

MR MURDOCH: Your Honour, I have already dealt with that in the earlier submissions in which I pointed to the fact that the Commissioner in a general way, recognised that the employees might lose conditions. However, my learned friend went on to address you in relation to more recent correspondence, and that's the correspondence that I've handed up to you.

PN151

HIS HONOUR: I don't see - how does that answer the point that was raised in the appeal grounds?

PN152

MR MURDOCH: I apprehend that there were two elements to my learned friend's argument. First she said, bonus was a matter where employees potentially could lose. She then said the Commissioner didn't take into account that factor. That's incorrect, your Honour, on the face of the Commissioner's decision, because he does recognise that employees might lose matters that are not contained in the Safety Net Award. He then went through the Joy analysis.

PN153

Now, closing off on that, I move to the other submission my learned friend made, which is one in which she referred to the letter of recent date. Now since she has raised it, I need to deal with it. You will remember, your Honour, my learned friend said employees have been given a letter of any recent days that says - - -

PN154

HIS HONOUR: I remember, I made a note. I just don't see how it's really relevant.

PN155

MR MURDOCH: Your Honour, if it is relevant, it's very relevant to the matter of balance of convenience because while there's nothing in the substantive point, I have dealt with that, if you go to balance of convenience there's clearly nothing there for my learned friend either, because it's abundantly clear that the transitional arrangements put in place pursuant to the letter to employees of 3 April, are on the basis that the current Crinam mine bonus scheme will continue to operate. Now certainly it's pending certain other things happening.

PN156

But, your Honour, we are not dealing here with the arrangements for the long term. We are simply dealing here with the arrangements pending the hearing of the appeal, which naturally my clients will assist in facilitating the early hearing of. There is no suggestion, your Honour, from a balance of convenience point of view, that before the appeal is heard my clients will quickly swoop and take away the bonus. Your Honour, there's just no basis for that.

PN157

HIS HONOUR: Well there is a basis in that one would imagine that the finalisation of a revised bonus scheme could occur at any time and there's no assurance that it will occur only after the appeal has been heard and determined.

PN158

MR MURDOCH: Your Honour, it's theoretically possible. But it assumes, your Honour, a very big thing and it assumes that the company would want to reduce the bonus. It's just as likely that employees will do as well out of the bonus, or even better. The possibility, your Honour, is a theoretical one and in a balancing on convenience, what your Honour has in the letter that my learned friend introduced to the debate, is a letter that indicates that the current scheme will continue to operate pending etcetera, etcetera.

PN159

Now, your Honour, we are about balancing factors here. This is the arrangement we have put in by way of transition. It's not as if one waits a lengthy period for these appeals to be heard. There is no suggestion, your Honour, that my clients, as I said before, are going to swoop and even if they did revise the bonus, nothing to indicate hat they are going to eliminate it, that they are going to take that form or that amount of income away from employees.

PN160

So, your Honour, I don't need to repeat that there is nothing in my submission, either on a substantive basis or a balance of convenience basis, that arises out of the bonus. Your Honour, my learned friend then said that the Commissioner hadn't taken into account the fact that under the agreement there's a provision for last on, first off and that that was a change - - -

PN161

MS HOWELL: Sorry, I just think that was a balance of convenience thing.

PN162

MR MURDOCH: Thank you, well I will deal with it now it's raised. Balance of convenience, it's said well Lofo disappears. Your Honour, yes, Lofo does disappear. But as against that, that is a loss of an agreement provision in circumstances where the legislation contemplates that agreements don't live forever and that there will be circumstances under which agreements are terminated after their nominal expiry date is reached.

PN163

Apart rom putting up the fact that it's said to relate to balance of convenience, there is nothing before you, your Honour, to indicate that it will have, in the short term or medium term, any need to be applied. Your Honour, I'm instructed that in fact my clients are refusing applications at present from employees who would like to take redundancies and they are doing that because they need delay. So from a balance of convenience point of view, your Honour, there's nothing in that one.

PN164

Your Honour, so far as rosters are concerned, I took you earlier to the parts of the evidentiary material which deal with the matter of rosters. We disagree with my learned friend, who contended that there was no agreement between the parties. Our contention is that there are provisions that fall into that category. My instructions are that since the Commissioner's decision, my clients have briefed employees in small groups as to the rostering arrangements to take place.

PN165

Our clients have gone into great detail and there is, on my instructions, no impediment raised which prevents the rosters proceeding as my clients have organised them. This is not, in my submission, your Honour, a situation where employees are going to have their rostered income slashed as a result of my clients reducing the nature of the roster. The prospect that my learned friend adverts to of a reduction to a 10 hour shift is one that is not contemplated.

PN166

Now, your Honour, if it is said by my learned friend that there's an argument that under the award implementation of that might lead to employees being entitled to overtime or some penalty rates, well that's a matter that can be sorted out in due course. But on our construction of the matter, under the agreement there was a very restrictive set of provisions as to working hours. The parties departed from that in the agreement that was reached and I referred you to that earlier.

PN167

Those agreed arrangement effectively supplanted the provisions of the certified agreement in any event. So that so far as hours are concerned, the termination of the certified agreement did not remove the basis that underpinned the hours that were operating at the mine, because the parties had themselves abandoned that basis in relation to the hours. So far as the record is concerned, the evidence of Mr Taylor - - -

PN168

HIS HONOUR: So, let me just confirm the impression I'm getting from that submission. You say there is an agreed set of roster arrangements which are applying at the mine which do not depend on the agreement that's been terminated?

PN169

MR MURDOCH: Yes, your Honour.

PN170

HIS HONOUR: Those roster arrangements are different from what is provided for under the agreement?

PN171

MR MURDOCH: That's right, your Honour. Effectively, the mine has worked on a seven day basis.

PN172

HIS HONOUR: It's not proposed to change those existing roster arrangements?

PN173

MR MURDOCH: Your Honour, I think there's some adjustment of 15 minutes in the roster but essentially no change. In the transcript, paragraph 548, there's a series of questions there. I won't read them aloud but there appear to be an acceptance there of the so-called new roster arrangements that I've referred to. In the letter of 10 April 2000, which is RGT2 that I referred you to earlier, there was a paragraph in that.

PN174

HIS HONOUR: Sorry, this is behind tab 7, is it?

PN175

MR MURDOCH: Yes. Under the table there was a reference there to a review. That was the subject of some questioning at that part of the record that I referred you to, paragraph 548, 549, 550.

PN176

HIS HONOUR: What's a KPI?

PN177

MR MURDOCH: Key Performance Indicator.

PN178

HIS HONOUR: So that's the reference to review?

PN179

MR MURDOCH: Yes.

PN180

HIS HONOUR: And then there's a reference to an immediate review of a roster trial?

PN181

MR MURDOCH: Yes, and he's dealt with why the review hasn't taken place and it's because the triggering factors had not arisen. So, your Honour, so far as the arrangements are concerned, in my submission, the Commissioner's decision is not in any way jeopardised through the position as to rosters and from a balance of convenience point of view, my submission is that in an effective sense employees will not suffer and consequently there is no basis upon which the Commission would intervene to attempt to preserve any form of status quo.

PN182

If there is an issue related to whether arrangements in place that we believe are by agreement, not by agreement, it might, in the fullness of time, give rise to claims for overtime or penalty rates and they're matters that, in the fullness of time can be determined and where delay, if anything, would favour employees and not prejudice them. If my learned friend is right that a shift should only be 10 hours and not 12, well then, it can only disadvantage my client and not the employees so that there is no issue at all so far as the status quo is concerned. Going on to another matter, your Honour, this is the point that my learned friend suggests is a prospect of appeal point in relation to the decision.

PN183

The Howlett affidavit, tab 17, CFMEU5. When one looks at the contents of the Howlett affidavit, it's abundant, on its face, that it's a point without any relevance because even if the statement was correct, it's meaningless and irrelevant. It's supposedly a question about cancellation of the agreement and a suggestion that the main reason is so we can take away the right to strike under protected action. Well, that's not the law, it couldn't have that effect and it's informative to see the rest of the conversation:

PN184

HOWLETT: No I understand it that when we go back to the award we can then put in a bargaining period. KR: Yeah, right, whatever.

PN185

Your Honour, might I again refer you to the material which I took you to earlier, it details the provisions in the agreement which my clients contend are impediments to the efficient conduct of the business and I'd submit that there are, manifestly, reasons why a company would wish to be rid of the agreement. However, more importantly, is the fact that under the relevant section, none of the elements that are relevant for the Commissioner go to the reason behind the applicant bringing the application. The reason behind the application is not one of the statutory elements. In my submission, the application, once it is instituted, will lead and must lead inevitably to a termination of the agreement unless it is against public interest.

PN186

The Statute has not, in my submission, introduced any element that requires the applicant to put forward a reason or that invalidates an application or prevents the exercise of jurisdiction if the reason is said to be of a particular kind. This was dealt with in the submissions of my learned friend, Mr Jessup, on behalf of my client before the Commissioner. He dealt with this in proper purpose issue in paragraphs 1008 and 1009 of the transcript and he emphasised particularly the proposition that, under section 170MH, the company in making the application doesn't have to have a purpose and whatever its purposes are,are entirely matters for itself.

PN187

Your Honour, the next point that we need to go to is the argument that the Commissioner was derelict in his decision prima facie able to be challenged. On the basis that the union said, if you terminate the agreement, we might strike and if we strike that might destabilise parts of the mine and we might then be in danger, ground 3 of the Notice of Appeal. Your Honour, it is a curious submission, a submission whereby a party making a threat they would strike if the Commission issues a particular order and by striking might put themselves in danger and therefore the Commission might have erred by not giving weight to that factor.

PN188

It is curious logic and, in my submission, not a ground upon which the Commissioner's decision could sensibly be imperilled on appeal. Your Honour, it is also on that point relevant to state that there is an application to terminate the bargaining period at Crinam. That matter has been heard by Commissioner Bacon. His decisions is reserved and I understand that the Commissioner - we are unaware as to when the Commissioner's decision will be given. There has been, your Honour, been a strike at Crinam. That strike though concluded some two weeks ago and since that time the employees have worked and continued to work normally.

PN189

Your Honour, could I turn then finally to the matter of balance of convenience? So far as the balance of convenience goes, I have indicated earlier that my clients have taken extensive steps to accommodate the change from the certified agreement to the award. Mr Ritchie and other representatives of the company have been involved in detailed and extensive discussions with employees commencing on 3 April 2001 through to Friday 6 April 2001. Mr Ritchie and Mr Taylor gave a series of presentations to all crews about the implementation of Commissioner Bacon's decision.

PN190

The sessions generally lasted two hours in duration. All employees were given the opportunity to ask questions on the implementation of the Award - - -

PN191

MS HOWELL: If my friend is just going to read the entirety of an affidavit, then I am going to ask for the opportunity to cross-examine.

PN192

MR MURDOCH: Your Honour, I am not reading the entirety of the application. I have skipped paragraph 12. Well, my learned friend stops. I am endeavouring to conform to the way in which these matters are conducted and it is relevant to balance of convenience that I put forward in a concise way what the clients have done. Your Honour, a series of slides was used for the two hour presentation to the groups of employees. The slides are here in court and available for your Honour to examine if your Honour wishes to examine them.

PN193

On 3 April 2001, my client sent a letter to Mr Barnes, the President of the CFMEU Crinam Lodge about the implementation of Commissioner Bacon's decision. I will hand up a copy of that letter.

PN194

MS HOWELL: I don't object, your Honour.

PN195

HIS HONOUR: Exhibit M4.

EXHIBIT #M4 LETTER SENT TO MR BARNES FROM BHP COAL DATED 03/04/2001

PN196

MR MURDOCH: Your Honour, there are some other practical considerations that I will endeavour to deal with very concisely. A provision in the certified agreement which is not to be continued relates to the provision of a bus service to and from work for employees who live in Emerald. That is not to be continued. It will not be continued.

PN197

HIS HONOUR: Yes. That is in the - - -

PN198

MR MURDOCH: Certified agreement.

PN199

HIS HONOUR: I thought that was in something else that I have read here, but maybe it was one of the exhibits I've been taken to. Was that in those dot points regarding the implications? No, it's in this exhibit M3.

PN200

MR MURDOCH: It's in clause 34 of the certified agreement, your Honour.

PN201

HIS HONOUR: It's in exhibit M4. It set out the bus service receipts as from the date to be advised.

PN202

MR MURDOCH: Your Honour, the actual date is the 15th of this month, and the position is that there was a contract between my client and a company known as McCaffertys, and that contract is already the subject of a formal notice from my client dated 6 April 2001, which I tender.

PN203

MS HOWELL: No objection.

PN204

HIS HONOUR: Exhibit M5.

EXHIBIT #M5 CONTRACT

PN205

MR MURDOCH: Your Honour, so far as that bus service went, my instructions are that about 50 per cent of the employees were making their own transport arrangements to and from the mine site in any event. The arrangement of course was under the agreement confined to employees who lived in the town of Emerald. Those who lived elsewhere had no entitlement. To that extent the transport arrangements are now subject of the uninformative, it did not exist in the past.

PN206

Letters have been sent to individual employees advising them of the change in bus services as from the cessation of day shift on Sunday, 15 April, 2001, and I tender a copy of that letter.

PN207

HIS HONOUR: Exhibit M6.

EXHIBIT #M6 LETTER ADVISING OF CHANGE IN BUS SERVICES

PN208

MR MURDOCH: So that your Honour is fully appraised of matters of immediate impact, there was a provision in the certified agreement that related to vehicle leasing, a notated leasing scheme.

PN209

HIS HONOUR: Doesn't this matter and all these matters raise that generally difficult problem of how do you unscramble the egg in the event that the appeal was successful? How do you, for example, if the appeal was successful and the agreement continues, how do you compensate people for the fact that you have withdraw a bus service? How do you compensate people in terms of potential changes to their employment conditions? Is any action going to take place that is going to apply, as it were, or not apply the last on first off principle and for people to be terminated and presumably paid out their entitles on termination? How are those people going to be compensated or put back into a position that they might be entitled to be in should the agreement not be terminated?

PN210

MR MURDOCH: Well, your Honour, so far as last on first off is concerned, that is totally academic because that only arises if my clients retrench. My clients in fact are knocking back people who want to go as voluntary retrenchees.

PN211

HIS HONOUR: So is there some sort of a commitment or undertaking that there won't be retrenchments applying or not applying the last on first off principle in the period before the appeal was determined?

PN212

MR MURDOCH: Your Honour, i think I can probably do better. I'll see if I can get an undertaking that there will be no forced retrenchments pending the appeal, but let me get instructions.

PN213

HIS HONOUR: I mean, you know the issue that I'm raising with you, and that issue is the general one of what happens if the appeal is successful? And there have been a number of things which have been changed. The company would have changed these things acting on the basis of what it believes its entitlements to be, but if it's proved that it wasn't acting on a proper basis, the company is the one that is going to, as it were, have to bear the cost of trying to put that situation back into a situation which complies with a company observing the terms of an agreement which might have continued to apply.

PN214

MR MURDOCH: Which your Honour, if that occurred, we would do, because it is a far lesser burden, the prospect of that, than being burdened with the intolerable burden that my clients have suffered for such a long time since the nominal expiry date of this agreement in 1999 with the provisions which shackle the ability to get productivity out of the mine. It's a matter of balance.

PN215

HIS HONOUR: But could I be assured that nothing is going to happen which is as it were not reversible in the event that the appeal was successful? That is why I raised with you this problem about the last on first off because there might be a difficult exercise in working out someone's entitlements if they continue to work under slightly different arrangements than in the past, but it would be possible to work out that. But if somebody has actually been dismissed, they're out of the operation, they've received their entitlements, they might be forced to sell houses - - -

PN216

MR MURDOCH: Would you excuse me one moment, your Honour?

PN217

HIS HONOUR: I mean, that's the nature of the concern that I'm raising.

PN218

MR MURDOCH: I'd rather deal with it, your Honour, on specifics, and that's one where I will get some instructions. Was there another one your Honour had?

PN219

HIS HONOUR: I must say, I'm not so completely across all these changes because you would have to analyse exactly what changes were involved, for example, the bonus scheme. It seems to me, at least, that there is no significant change involved in relation to the bonus scheme.

PN220

MR MURDOCH: And that is the case, your Honour.

PN221

HIS HONOUR: Other than it was underpinned by an agreement which has been terminated

PN222

MR MURDOCH: That's right.

PN223

HIS HONOUR: Even if the bonus scheme was to be revised downwards, if the appeal was successful then one would imagine the bonus payments under the agreed agreement arrangements could be calculated and made good.

PN224

MR MURDOCH: That's right, your Honour.

PN225

HIS HONOUR: But that's one thing. I mean, the roster arrangements from what you're saying it's not anticipated that it's other than a relatively minor change in what was applying at the mine prior to the termination of the agreement?

PN226

MR MURDOCH: It is certainly not the case where people will drop from 12 to 10 hours as our learned friend suggested.

PN227

HIS HONOUR: If there was a change it might be slightly more difficult to work out the different entitlements but one could imagine it could be worked out.

PN228

MR MURDOCH: It doesn't appear to be an issue of substance, your Honour.

PN229

HIS HONOUR: The rates of pay - are they being maintained or not? I am clear with the rates under the would be different from under the award but this is covered by the agreement - - -

PN230

MR MURDOCH: Your Honour, if it's covered by the letter. The difference becomes an over award payment.

PN231

HIS HONOUR: Yes. There's some changes to sick leave but I'm not sure what the ..... West Fund Scheme is but that's going to be discontinued.

PN232

MR MURDOCH: The issue there is that the company has been paying the contributions of employees toward a medical top-up scheme. It amounts to approximately $500 or $600 a year. Under the change, the employees would be responsible for that themselves.

PN233

HIS HONOUR: In effect and subject to the matter on which you're getting instructions on, what you're putting to me is that there will be some changes but those changes are not overwhelmingly significant and to the extent that there are changes, in the event of the appeal being successful, they are changes that could be corrected?

PN234

MR MURDOCH: That's the case, your Honour. I want to be very frank about this. The only one that your Honour might have overlooked is the one of the removal of the bus, in that you can't retrospectively reinstate a bus. You can put it on from - - -

PN235

HIS HONOUR: That's the one that started me thinking about it. People who haven't had the advantage of the transport, you can't retrospectively provide the transport which they didn't get and they might have gone to some expense in making other arrangements. One can imagine taxis or people have to go to the extent to buying second cards in families or car pooling arrangements or whatever.

PN236

MR MURDOCH: So far as the bus is concerned, if the appeal was successful and the agreement reinstated, the bus obligations would need to be recontracted or a fresh contract entered into and buses re-engaged. So far as the intervening period is concerned, if that scenario unfolded, I do acknowledge that it would be not possible to retrospectively unravel that for the intervening period. That really stands on its own and it is a matter of again weighing up balance of convenience issues.

PN237

On one view of the matter, your Honour, the employees have had the benefit of that bus arrangement for far longer than the company had contracted for under the certified agreement. They've had the benefit of it now for many months since the nominal expiry date which was 16 October, 1999.

PN238

HIS HONOUR: Are you in a position to tell me what you are going to say about the forced retrenchments?

PN239

MR MURDOCH: Just endeavouring to get those instructions. I hope to have them in a moment.

PN240

HIS HONOUR: How much longer might you be?

PN241

MR MURDOCH: Given the time, I think I would conclude now, subject to getting those instructions.

SHORT ADJOURNMENT [4.44pm]

RESUMES [5.02pm]

PN242

MR MURDOCH: Your Honour, I am able to give an undertaking on behalf of my client. May I say that it is on the assumption and I think the reasonable one, that there will be cooperation between the respective parties and the Commission in an effort to program the appeal for hearing as soon as possible. Your Honour, on the assumption that that set of facts is good, my client will undertake that at Crinam Mine which is the mine, the subject of the certified agreement, there will be no forced retrenchments pending the hearing of the appeal. In so far as the transport arrangements are concerned pending the hearing of the appeal, the provision of buses will continue as now. To round off, your Honour, in other respects, in my submission, if we were ultimately to be unsuccessful on the appeal, the matters are capable of adjustment.

PN243

HIS HONOUR: Ms Howell?

PN244

MS HOWELL: Some comments were made about the roster system to the effect that in fact, the agreement has simply been disregarded and there is a separate agreement between the parties which is annexed to Mr Taylor's affidavit, that's not the case. The agreement expressly provides for agreements between the parties, that is the CFMEU and BHP. This is one such agreement, however, its term has obviously long since expired and it is no longer an operative agreement; that's annexure RGT2.

PN245

The award doesn't even contemplate agreements between the CFMEU and BHP so consensual variations can only be by agreement with the majority of the employees effected. There is no such agreement in place. The result of that is that the proposed shifts which might contain minor variations to the present arrangements without consent, I might add, are in breach of the award. The union has no intention assuming the respondent is successful on appeal or prior to that date of consenting, to any variation or of recommending the same to its members. The position is that under the award, we say, the respondent would be required if the decision is not stayed, to revert to the award provisions which is a maximum of 10 hours.

PN246

My learned friend has painted a picture of the severe disadvantages which it alleges would arise in terms of the continued of the agreement. The very matter which was most prominently complained of in the proceedings before Commission Bacon was the fact that, there might be a reversion to the provisions under the agreement with respect to rosters; that is a maximum of 12 hours when the supplementary agreement between the parties allowed for 12 and three quarter hours and so forth. The outcome of a stay not being granted, is one which would be more severe than this unless the respondent proposes to ignore its award obligations which is not something the Commission would assume in my submission and that is, the reversion to the 10 hour provision, which the respondent was at pains to point out the disadvantages of.

PN247

Now as to the severe disadvantages in terms of the continued operation of the business, those matters were asserted before Commissioner Bacon. As I've already alluded to, one of the major factors asserted to be a constraint was the possible reversion to the limitation of 12 hours per shift, but the Commissioner, in my respectful submission, rightfully held that those considerations were not relevant to the consideration of the public interest, and even if they were relevant to the stay application, what we are talking about is an extension of those conditions for a further month or two when they have, in fact, been in place for a very substantial time already.

PN248

On the question of bonus, first of all, to the extent that it's alleged that the Commissioner did, in fact, deal with the question of bonus, a number of other terms and conditions of employment which are being lost if the agreement is terminated have been referred to, in the letter which is M3. That includes such things as loss of health insurance, loss of transport, loss of unlimited sick leave. In my submission it's clear that that is what the Commissioner is referring to, and he is not referring to the possible loss of an $18,000 a year bonus.

PN249

Such a focus would be inconsistent with the statement that the letter which is referred to demonstrates an intention not to significantly, if at all, reduce employee remuneration. So it's clear in my submission that no regard was paid to the loss of the bonus and the express exclusion of the bonus from the statement of intent, and accordingly, the ground that the Commissioner didn't have regard to a matter which had significance, in my submission would clearly be made out and in accordance with the decision of Munro J that would be a factor touching on the public interest, because of the magnitude of the potential loss.

PN250

Now as to the reliance on the Worsley, I think it was, decision, print R5283, concerning the right to be heard, I haven't had a chance to fully read that decision but it's clear that section 127 application is of a very different nature to an application requiring consideration of public interest factors, such as the present. Beyond that, the only thing that the Commissioner took into account in that case was matters which were directly within his own knowledge as to industrial action.

PN251

What's been taken into account here is a series of negotiations, some of which the Commissioner attended, so the Commissioner took into account various negotiations, the content of which he was not aware of in part at least, in a situation where a complaint of bad faith formed a strong part of the applicant's case, based on conduct which was not dissimilar to the .... conduct in some respects, including the very substantial change of position by the respondent when negotiations had almost been finalised.

PN252

So this scenario is clearly distinguishable and it's a case where the respondent should properly have been heard and could not have been expected to anticipate that the Commissioner would take into account those factors, without giving an opportunity to be heard. Just again with respect to bonus, I think paragraph 19 which was pointed out by the respondent does confirm that the Commissioner didn't properly take into account the lack of an undertaking with respect to the bonus, because the Commissioner says there's no evidence that accrued rights of employees will be divested to a significant degree, if the agreement is terminated. Potential loss of an $18,000 bonus would obviously constitute a significant loss.

PN253

HIS HONOUR: What you're saying is that there was nothing before the Commissioner from which the Commissioner could have concluded that the bonus scheme would have been maintained?

PN254

MS HOWELL: Your Honour, there was nothing before the Commissioner to suggest that the bonus scheme was going to be maintained, and indeed the respondent expressly failed to give any undertaking or even any statement of intent with respect to bonus, and the mere fact that the respondent is simply conducting a review at this stage doesn't suggest that the entitlement is in any way protected.

PN255

In fact it would only give significant cause for concern at this stage. But on the material before the Commissioner the inference was that there would be changes to the bonus scheme, because it was expressly excluded from the statement of intent. When Mr Ivanoff, for the CFMEU, had expressly referred in his affidavit or statement to the fact that the loss of the bonus could amount to a loss of about $18,000 per annum.

PN256

Now with respect to my learned friend's submissions on improper purpose, there is a very well developed doctrine, your Honour, that where a proceeding is commenced for an improper purpose that that proceeding constitutes an abuse of process. Now you won't find any statute anywhere on the statute books that says if an application is commenced for an improper purpose it's an abuse of process. That is a common law doctrine, but it's equally applicable to Tribunal proceedings as it is in any other jurisdiction.

PN257

And the fact that it doesn't appear in the statute is simply irrelevant and misunderstands the basic argument, with respect. In this case, the statement which is recorded by Mr Howlett shows a purpose that is contrary to the fundamental principles of the Act, which is that parties should be entitled to bargain by using protected industrial action in order to pursue industrial agreements. The very purpose of the application, if Mr Howlett's evidence is accepted, and there was some other evidence tending to support that, was to take away the right to strike under protected action.

PN258

Now finally, we have, with respect to the ground 3 of the appeal, it's said that the CFMEU is making a peculiar argument by saying that the company is - I'll withdraw that. The argument as I understood it, was that it was peculiar for the union to say that it was the party putting safety at risk and therefore that wouldn't be a relevant consideration under the application. That in itself, is a rather peculiar argument. What the respondent is saying is we can terminate the agreement and it is not relevant to the public interest that the fact of terminating the agreement is likely to increase industrial conflict and if you exercise your rights under the Act, the rights which are given to you to enable you to bargain in this scenario, then, if that brings about a health and safety risk, a risk of collapse of the roof, then so be it, be it on your own heads and that is not a public interest matter.

PN259

There was no pun intended and I apologise, but if that's effectively the submission, then so be it, you have got a choice, you either refrain from exercising your right to take protected action, or, you take protected action as is intended under the Act and take the consequences in terms of safety risks, that's the proposition which is put. Irrespective of the rights and wrongs of that, in my respectful submission, the question as to whether the termination of the agreement would increase the prospects of industrial action, and consequently increase the likelihood of risk to health and safety, is a matter which in the public interest has to be relevant to a decision as to whether the agreement should be terminated. The complaint at the moment is that the Commission failed to take into account that very relevant factor.

PN260

As to whether the company has now applied to terminate the bargaining period, that is simply irrelevant to the argument, the ground of appeal and also to the balance of convenience to which that factor obviously also is relevant. It should be said that Mr Ivanoff's evidence to the effect that the termination of the agreement would increase the likelihood of industrial action was not challenged before the Commissioner. As to the respondent's arguments on the balance of convenience, they would have to put up with the onerous provisions of the agreement, they say, well, again Commissioner Bacon made no findings about the matters which the respondent said inconvenienced it in the agreement but, I have already referred to the main one which was the rostering arrangements and the possibility of reversing to the 12 hour shift.

PN261

The other matter which was relied on significantly was the process of approval of contractors entering onto the site. Even if that was relevant to the balance of convenience, one wouldn't think that it would be a significant matter in terms of balance of convenience when we are talking about a continuation of the existing arrangements for a further month or two. The other matters, the extensive steps which have been taken, came down to the fact that the respondent has had some talks with its employees about their various loss of entitlements, such as sick leave etcetera and withdrawal of transport. That is the first matter which is relied upon and the second matter is the cancellation of the bus contract which now seems to have been fixed in any event. So, in terms of inconvenience to the respondent of continuing the arrangement, really nothing is put forward before the Commission of any substance whatsoever. The only thing which is really going to cause inconvenience is if the 10 hour shifts are reverted to which is the precise consequence of the termination of the agreement.

PN262

HIS HONOUR: If you are right on the 10 hour shifts, the union in a sense has it both ways, does it, if the agreement is terminated, you say, the company under the proposed arrangements is in breach of the award. Yes, your Honour, we would say that. If the agreement isn't terminated, do I understand you say that the current arrangements or proposed are in breach of the agreement?

PN263

MS HOWELL: No, your Honour, they are not because the current arrangements are by way of an agreement between the parties which is contemplated by the certified agreement and obviously any agreement which is contemplated by the certified agreement would cease to operate once the certified agreement was terminated. The award has no provision for agreements between the parties. It only has provision for agreement between the majority of employees and the employer. It is not an agreement which is recognised under the award. Your Honour, there is no reason in our submission to depart from the status quo.

PN264

HIS HONOUR: Let me just understand the form of the rosters. Does the union want to revert to 10 hour shifts?

PN265

MS HOWELL: The union is not in a position of consenting to any other arrangements. I don't have instructions that it is going to insist on reversion. I think it is really awaiting the outcome of this application but the possibility is that the majority of employees would agree, but that is certainly not something that is in the bag by any stretch, so it is possible that to the extent that the union and the members are the same thing, there would be insistence on reversion to that arrangement.

PN266

HIS HONOUR: If I can sum up the balance of convenience on that particular point, the union is not opposed to the continuation of roster arrangements under the agreement?

PN267

MS HOWELL: Yes, your Honour. Assuming that all of the agreement remains in place. That's the assumption.

PN268

HIS HONOUR: That's the proviso, but I am just isolating the roster arrangements. If I was to grant a stay, then presumably, one of the implications of that is that the agreement roster arrangements continue to apply.

PN269

MS HOWELL: At present, yes, your Honour.

PN270

HIS HONOUR: If I don't grant a stay, the consequence of that seems to be under what's been put to me by the company, the current roster arrangements continue to apply, with some minor modifications. The difference between the two situations being that the company is at risk under the second set of arrangements of being in breach of the award, according to your submission.

PN271

MS HOWELL: It is also at risk of the employees insisting on reversion to 10 hours and working in accordance with the award, I would have thought, your Honour.

PN272

HIS HONOUR: Yes, that's encompassed in the concept of them being in breach of the award, not being allowed to do it, being able to be prosecuted if they do do it, and the employees being able to insist on their award entitlements.

PN273

MS HOWELL: That's so, your Honour. The other aspect is that the union is not under the award entitlements itself, able to agree to any variation, so it really is a matter that the individual employees are required to agree to, so, it is certainly can only be said to be a situation of extreme uncertainty until - - -

PN274

HIS HONOUR: I think it is a majority of employees, isn't it?

PN275

MS HOWELL: Yes, your Honour.

PN276

HIS HONOUR: I assume that the workforce at Crinam is still relatively heavily unionised.

PN277

MS HOWELL: That is so, your Honour.

PN278

HIS HONOUR: Right.

PN279

MS HOWELL: I don't think I have anything further to say, if it please the Commission.

PN280

MR MURDOCH: Might I be heard about those questions you asked my learned friend in relation to the award provisions on rostering?

PN281

HIS HONOUR: Yes.

PN282

MR MURDOCH: Your Honour, the relevant provisions of the award are in clause 24. Under 24(2) there are provisions about length of shifts, under 24.2.2, it says:

PN283

Shifts, including more than 10 ordinary time hours can only be implemented by agreement between the employer and the majority of affected employees.

PN284

24.2.3:

PN285

In the event that the employer wishes to introduce shift lengths greater than 10 ordinary hours and the employer ...(reads)... the matter may be referred to the Commission for determination.

PN286

Then in 24.3, Number and Spread of Shifts:

PN287

The number and spread of ordinary shifts may be varied by the employer or by order of the Commission.

PN288

Your Honour, our view is that the distinction sought to be drawn here between the union and the employees is quite artificial and I, in my submissions, advised you of the fact that we had been to the employees, we discussed it with the employees, we have had an agreement in place now for many months. We don't see that agreement as evaporating. This issue, with respect, your Honour, is one that doesn't affect the status quo. My client's mistaken, it's on the client's head.

PN289

HIS HONOUR: Thank you for the submissions. This is clearly an important matter and quite detailed submissions have been put in the proceedings this afternoon. It's also a matter which does have some immediate import in terms of the timing of proposed changes and arrangements following from the termination of the agreement by Commissioner Bacon. It's also a matter which is being heard before a major holiday and I realise that a number of people have travelled in order to be at the proceedings today. In all the circumstances, I've decided to simply announce a decision in this matter and to indicate to you that I will publish the reasons for that decision as soon as I can.

PN290

The decision that I have reached is that I will not make any order staying the decision or the order which has been made by the Commissioner. As I have indicated, I will publish reasons for this decision as soon as possible.
That concludes these proceedings.

ADJOURNED INDEFINITELY [5.32pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #M1 PRECIS OF RELEVANT PRINCIPLES PN103

EXHIBIT #M2 CORRESPONDENCE PN140

EXHIBIT #M3 LETTER DATED 03/04/2001 PN144

EXHIBIT #M4 LETTER SENT TO MR BARNES FROM BHP COAL DATED 03/04/2001 PN196

EXHIBIT #M5 CONTRACT PN205

EXHIBIT #M6 LETTER ADVISING OF CHANGE IN
BUS SERVICES PN208