C2002/586, Transcript of Proceedings [2002] AIRCTrans 2326 (25 June 2002)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT MARSH
SENIOR DEPUTY PRESIDENT DUNCAN
COMMISSIONER McCUTCHEON

C2002/586

APPEAL UNDER SECTION 45 OF THE ACT
BY AUTOMOTIVE, FOOD, METALS, ENGINEERING,
PRINTING AND KINDRED INDUSTRIES UNION
AGAINST THE DECISION OF SENIOR DEPUTY
PRESIDENT O'CALLAGHAN ISSUED ON 5 MARCH
2002 IN C2002/584 RE APPLICATION TO STOP
OR PREVENT INDUSTRIAL ACTION

ADELAIDE

10.39 AM, TUESDAY, 11 JUNE 2002

PN1

SENIOR DEPUTY PRESIDENT MARSH: Could I take the appearances, please?

PN2

MS J. SMITH: I appear on behalf of the applicant, and with me is MR A. NICHOLSON.

PN3

MR B. AUSTIN: I appear on behalf of the respondent, and with me is MR D. BROWN of Detmold Packaging.

PN4

SENIOR DEPUTY PRESIDENT MARSH: Yes, Ms Smith.

PN5

MS SMITH: First, your Honours, I just simply need to make a correction. At paragraph 1 of the notice of appeal it incorrectly states "the Commissioner." Could that please be changed to "the Senior Deputy President?" Your Honours, this is an appeal against a decision and an order made by Senior Deputy President O'Callaghan on 5 March 2002. The Senior Deputy President held that as Detmold Packaging Enterprise Bargaining Agreement 2001 was currently in operation and was not due to expire until 30 June 2003. As a result of this finding the Senior Deputy President ordered the AMWU and members of the AMWU employed at Detmold Packaging not to engage in industrial action as per terms of the order dated 5 March.

PN6

Your Honours, as much of the evidence before you will be uncontested I doubt that there will be a need to call witness evidence. However, I have Mr Nicholson and Mr Murdoch with me should that be required. I will begin briefly by outlining the background to this industrial dispute. On 17 October 2001 the Detmold Packaging Enterprise Agreement was certified in the Australian Industrial Relations Commission by Commissioner Lesses. This agreement came into force on 1 July 2001 and the nominal expiry date is 30 June 2003. There are no clauses with respect to redundancy in this enterprise agreement.

PN7

Prior to this hearing I have provided the Commission and my learned friend with copies of a transcript from an earlier section 127(2) application by Detmold Packaging against the AMWU and this is dated 14 December 2001. Have your Honours had an opportunity to read that transcript?

PN8

SENIOR DEPUTY PRESIDENT MARSH: That's a transcript circulated last Friday.

PN9

MS SMITH: That's right.

PN10

SENIOR DEPUTY PRESIDENT MARSH: Yes, thank you.

PN11

MS SMITH: I would refer your Honours to paragraph number 10 where Mr David Brown, who at the bar today - he is the Personnel Manager from Detmold Packaging and he states that Detmold Packaging have an over-award redundancy agreement which was established in 1995. However, this agreement was never formally ratified at the Commission but has been authenticated by an exchange of letters between the parties at that time. It was agreed earlier last year to revise and review the Detmold Packaging redundancy agreement prior to Christmas of 2001.

PN12

At paragraph number 35 and 36 of the transcript Mr Brown concedes that the Detmold Packaging Enterprise Agreement 2001 does not have any provisions relating to redundancy. The enterprise agreement does not list the issue of redundancy in clause 20 as a reserved matter either. Most importantly, at paragraph number 60 of the transcript, Mr Brown states, and I quote:

PN13

The Detmold Packaging Enterprise Agreement was ratified in October and the issue of redundancy matters was raised during the course of negotiations but both parties agreed that they would not include it in the -

PN14

and there's a dash -

PN15

reference to it in the enterprise agreement but try and conclude a separate agreement, an outside enterprise agreement after the enterprise agreement had been ratified.

PN16

At paragraph number 62 Mr Brown says, and I quote:

PN17

While it was discussed that the existing Detmold redundancy agreement, which had been in place since 1996, would be the basis for negotiations and that it would be revised and updated and upgraded to some extent.

PN18

In paragraph number 87 of the transcript before your Honours Ms Regione, the Industrial Officer of the AMWU states, and I quote:

PN19

When the enterprise agreement, enterprise bargaining negotiations, started earlier the year the union indicated to the company that we were very keen to see these documents finally registered and included in the enterprise agreement. However, the company were not willing to do that but they did provide us on ratification of the enterprise agreement with a written guarantee that this document, this agreement, would be updated and registered this year.

PN20

At paragraph number 89 Mr Brown acknowledges that he signed this agreement between Detmold Packaging and the union. I have a copy of this signed document and I wish to hand that up and seek that to be tendered and marked as an exhibit. My friend has been given a copy.

PN21

SENIOR DEPUTY PRESIDENT MARSH: Yes, was that an exhibit before Senior Deputy O'Callaghan, Ms Smith?

PN22

MS SMITH: Pardon?

PN23

SENIOR DEPUTY PRESIDENT MARSH: That was an exhibit before Senior Deputy President O'Callaghan.

PN24

MS SMITH: I don't think it was.

PN25

SENIOR DEPUTY PRESIDENT MARSH: Was that A1?

PN26

MS SMITH: Yes, it was, yes.

PN27

SENIOR DEPUTY PRESIDENT MARSH: Yes, thank you. Yes, it wasn't in the appeal folders in the original file that I have. So it's the same document.

PN28

MS SMITH: That's right.

PN29

SENIOR DEPUTY PRESIDENT MARSH: We'll mark this this time exhibit S1.

EXHIBIT #S1 AGREEMENT BETWEEN DETMOLD PACKAGING AND AMWU SIGNED BY MR BROWN

PN30

MS SMITH: Ms Regione states at paragraph 92 of the transcript, and I quote, that:

PN31

At the bottom of this document are listed a number of matters which are to be approved and agreed separately from the enterprise agreement. The first of these is the protection of accrued entitlements, that is insurance cover, and the second matter is updating the redundancy agreement in 2001.

PN32

At paragraph number 145 of the transcript, Ms Regione states that:

PN33

Before the agreement was ratified, this B2 -

PN34

and she is referring to an exhibit -

PN35

was a notice which accompanied the enterprise document draft which went to every employee prior to them taking a vote on it and it was jointly signed by the company and the union and it set out the way in which matters would be dealt with and it clearly stated that the company has agreed to update the redundancy agreement, the safety guidelines on excessive temperature, the chattel offices charter and insurance cover to protect accrued entitlements to continue to discuss those matters.

PN36

Your Honours, it was clearly the intent of the parties that those four matters were not to be considered as being extra claims. They were anticipated and agreed to by both parties to be issues that were exempted from the enterprise agreement to be dealt with by the parties at a later date. Your Honours, although these four matters have not been placed under the reserved matters list in the agreement itself, the intention of the parties was clear. Further discussion and a certification of a redundancy agreement would take place later in 2001. This is supported by paragraph number 181 of the transcript where Mr Brown states:

PN37

The company did make an obligation to revise and update the redundancy agreement by the end of this year and did progress a number of meetings -

PN38

SENIOR DEPUTY PRESIDENT MARSH: Sorry, what paragraph is that?

PN39

MS SMITH: Paragraph number 181 of the transcript.

PN40

SENIOR DEPUTY PRESIDENT MARSH: Yes, sorry.

PN41

MS SMITH: That's all right and:

PN42

update the redundancy agreement by the end of this year and did progress a number of meetings, consultative meetings, to get an updated agreement.

PN43

However, negotiations for the redundancy agreement were not progressing. The final written document, which I seek leave to tender as an exhibit, was the final company offer dated 14 February 2002.

PN44

SENIOR DEPUTY PRESIDENT MARSH: Thank you, Ms Smith.

EXHIBIT #S2 FINAL WRITTEN DOCUMENT

PN45

MS SMITH: As the negotiations for the redundancy agreement were not progressing, Mr Nicholson, the Regional Secretary of the Printing Division, filed a notice of intention of bargaining period on 25 February 2002, together with a notice of intended industrial action. This was served on the company on 26 February 2002. The notice of intended industrial action foreshadowed a meeting of members of the AMWU on 5 March 2002 with possible industrial action in the form of bans, limitations and/or cessations of work, depending on the response of Detmold Packaging to the demands made by the AMWU and its members.

PN46

On 1 March Detmold Packaging filed an application for an order to stop or prevent industrial action pursuant to section 127(2) of the Act. Detmold Packaging stated that pursuant to section 170MN of the Act the AMWU and its members are prohibited from engaging in industrial action as the nominal expiry date for the enterprise agreement had not yet passed. Detmold Packaging alleged that the threatened industrial action is not protected and in their draft order which was provided to the Commission Detmold Packaging sought that the order shall remain in force for a period of 6 months.

PN47

The Senior Deputy President issued an order in the same terms as the draft order with the exception that the order was to remain in force until the expiry of the enterprise agreement which is 30 June 2003. Your Honours, it is our submission that the Senior Deputy President erred in law. In our submission, he was bound to follow the decision of the Federal Court of Australia in Emwest Products Proprietary Limited v The Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union. In this decision Kenny J held that Part VIB of the Act also contemplates that employees may be subject to more than one certified agreement, the nominal expiry date of which has not passed at any one time. This is referred to in section 170LY(1)(b) of the Act.

PN48

Kenny J held that section 170MN(1) does not prohibit industrial action for the purpose of advancing redundancy claims of employees, notwithstanding that the current enterprise agreement was still in operation. As in the matter before you, your Honours, there was a history of the co-existence of two enterprise agreements, one general enterprise agreement and one enterprise agreement specifically addressing redundancy. Both of these - - -

PN49

SENIOR DEPUTY PRESIDENT MARSH: Ms Smith, can I just interrupt you?

PN50

MS SMITH: Yes, your Honour.

PN51

SENIOR DEPUTY PRESIDENT MARSH: This authority you're now relying on, that wasn't raised before the Senior Deputy President below, was it?

PN52

MS SMITH: No, I don't think it was. Mr Nicholson appeared before the Senior Deputy President. So therefore he didn't have any legal representation at that time and he wouldn't have been aware of that decision, your Honour.

PN53

SENIOR DEPUTY PRESIDENT MARSH: Yes, I think this decision had been issued a month or so before the proceedings before his Honour.

PN54

MS SMITH: Yes, I wasn't at the application for the 127 order. Mr Nicholson was in attendance on that day and I understand when Mr Austin sought leave to appear Mr Nicholson said he had no objections at that time. However, should he need to obtain legal advice he reserved the right to do so. As I said, both the agreements had different expiry dates. However, in the matter before you, your Honours, although Detmold Packaging had a separate agreement for redundancy which had been in operation since 1995, this agreement had never been ratified or certified in the Commission.

PN55

Your Honours, the Emwest case resulted from the union serving on Emwest a notice pursuant to section 170MO of the Act stating that employees at Newport intended to take industrial action from 4 o'clock on Friday, 7 September 2001. At the time of the notice there was a current enterprise agreement in operation. Emwest submitted that section 170MN(1) of the Act prohibited the union from engaging in any industrial action in support of employer's redundancy claims because their employment was subject to the 2000 agreement, the nominal expiry date of which had not yet passed.

PN56

The union, on the other hand, submitted that section 170MN(1) does not prohibit the union from engaging in industrial action in this case because the subject matter in dispute, which was redundancy, is not dealt with in the 2000 enterprise agreement. It is our submission, your Honours, that the decision of the Senior Deputy President did not take into account the binding authority of the Federal Court in the Emwest decision. Kenny J stated that the issue arose out of the ambiguity created by the use of the expression in respect of the employment of employees whose employment is subject to the agreement.

PN57

The reference to the agreement is a reference to the certified agreement and she held that the whole expression is capable of having more than one meaning. The expression may be read as referring to the employment of employees where this employment is specifically subject to the agreement. That is the expression may refer only to the matters actually agreed upon by the parties in the agreement.

PN58

SENIOR DEPUTY PRESIDENT MARSH: Yes, what paragraph are you referring to of her Honour's decision?

PN59

MS SMITH: I would have to find that out. Paragraph 43, your Honour.

PN60

SENIOR DEPUTY PRESIDENT MARSH: Yes, thank you.

PN61

MS SMITH: That begins at paragraph 43. If so their prohibition would relevantly extend only to industrial action taken for the purpose of advancing claims in respect of such ..... matters. Kenny J said that if the expression is open to more than one meaning it is to be construed in the way that best promotes the relevant statutory object and she referred to the Act's Interpretation Act section 15AA. The principal objects of the Act are set out in section 3 and include the following enabling employers and employees to choose the most appropriate form of agreement for the particular circumstances, whether or not that form is provided for by the Act.

PN62

Kenny J held that the policy is sufficiently protected if section 170MN(1) is construed as prohibiting parties to a certified agreement from resorting to industrial action to undo the matters that they have agreed upon in the agreement if its nominal expiry date has not yet passed. It is our submission that the enterprise agreement no further claims clause only relates to subjects covered by the agreement. This was not the intent of the parties at the time of the agreement. There could have been a clause inserted stating that this enterprise agreement is intended to cover the field.

PN63

Furthermore, the transcript provided to your Honours shows that the parties intended and agreed to negotiate and certify a redundancy agreement during the life of the current enterprise agreement. Detmold Packaging were not only aware but agreed to review and certify a separate redundancy agreement to replace the 1996 redundancy agreement. Once the certified agreement had been certified the union was faced with the position that Detmold Packaging said: here's the final offer, take it or leave it; and then they applied for a 127 order to prevent the union from taking industrial action.

PN64

Your Honours, we seek that the order of the Senior Deputy President be quashed and that his decision be overturned. This will then give the union more influence in their bargaining and negotiation and result, hopefully, in a certified redundancy agreement or, as is the union's preferred view, to have a redundancy agreement incorporated into the current enterprise agreement by variation by consent. Thank you, those are our submissions, your Honours.

PN65

SENIOR DEPUTY PRESIDENT MARSH: Yes, thank you, Ms Smith. Yes, Mr Austin.

PN66

MR AUSTIN: Yes, thank you, your Honours. Firstly, I question whether the threshold of establishing the entitlement to the leave to be granted to proceed with the appeal has been satisfied and there has been no identification of a matter of such importance that it is in the public interest that leave should be granted. The matter is of very limited effect. Interestingly it is not of such importance or of pressing effect that the employees or the unions made an application to stay the appeal under section 45(4) after it was granted. In fact, the parties have continued to have further negotiations in respect of the agreement since then but have not been able to reach final agreement.

PN67

SENIOR DEPUTY PRESIDENT MARSH: Mr Austin, I wouldn't have thought that an order that extended for the duration of an enterprise agreement made under 127 was of limited importance.

PN68

MR AUSTIN: Well, your Honour, it is not a case that we are dealing with anything new here. My friend has referred to the Emwest decision which has set out a certain view in relation to when industrial action can be taken during the life of an agreement. 170MN which sets out the prohibition again puts limits on that prohibition. I mean, the importance, if you like, your Honour, is highlighted by us, it has not affected the day-to-day relationship between the employer and the unions and the employers and its employees during this time because they are able to continue with Senior Deputy President O'Callaghan's order in place and not seek to have the matter stayed and I think that is a bit of a hint as to how important or how unimportant this matter is.

PN69

Dealing with the merits of the appeal, your Honours, as you will see from the agreement and the appeal books - before I say that, as Ms Smith said at the outset or foreshadowed, there is not a great deal of factual dispute in the matter but there is an important matter of factual dispute, if you like, that Ms Smith said that the parties' intentions were clear and they intended to ratify another agreement. Now, that is not the - we don't want to see certified agreement. The reference was made to in the prior transcript of Mr Brown at paragraphs 60 and 62. Mr Brown said the Detmold Packaging Enterprise Agreement was ratified in October:

PN70

The issue of redundancy matters was raised during the course of negotiations but both parties agreed they had not included in the reference in the enterprise agreement but try and conclude a separate agreement, an outside enterprise agreement, after the enterprise agreement had been ratified.

PN71

Then there's a question of clarification from the Senior Deputy President:

PN72

Can I ask whether any thought or agreement had been reached, thought had been given to or agreement reached on the form of the separate agreement.

PN73

Mr Brown's was discussed and the existing Detmold Redundancy Agreement which had been in place since 1996 would be the basis for negotiation and it would be revised and updated and upgraded to some extent. There is nothing in that that says they contemplated there would be another certified agreement in relation to that. Ms Smith referred to Ms Regione's submissions at paragraph number 87 and said that:

PN74

When the enterprise bargaining negotiation started earlier this year the union indicated to the company that it would be very keen to see the documents finally registered and included in the enterprise agreement.

PN75

Now, that was the negotiations albeit earlier this year refer to the whole negotiation. Then she goes on:

PN76

However, the company were not willing to do that but they did provide us on ratification of the enterprise agreement the written guarantee in this document. This document will be updated and registered this year. We have here a copy jointly signed by the company and the shop steward to that effect and a newsletter to the workers advising that.

PN77

That was then the reference to exhibit S1 which was A1 in the hearing before Senior Deputy President O'Callaghan and has been S1 today.

PN78

SENIOR DEPUTY PRESIDENT DUNCAN: This one - I may have marked the wrong document - was A1 before the Senior Deputy President?

PN79

MR AUSTIN: It is a document headed: Detmold Packaging Consultative Committee.

PN80

SENIOR DEPUTY PRESIDENT DUNCAN: Proposed enterprise agreement 2001.

PN81

MR AUSTIN: 2001. It was dated 23 August.

PN82

SENIOR DEPUTY PRESIDENT DUNCAN: It is the same document but it is marked exhibit A1, that is in the proceedings below.

PN83

MR AUSTIN: In that, I mean, contrary to what Ms Regione said in paragraph 87 about having ratification of the agreement, be registered, that in fact the parties' intentions are set out there. It says:

PN84

Other employee initiatives -

PN85

this is the bottom bold heading on the page -

PN86

Actions approved and agreed separately from the agreement.

PN87

I do highlight the phrase: separately from the agreement. It talks about protection of accrued entitlements, the redundancy agreement:

PN88

The consultative committee will advise and update this year.

PN89

Then some reference to excessive temperature in the Chapel Officers Charter and that has been signed off by Mr Brown on behalf of the management representative on the consultative committee, a Mr M. Murdoch who is the employer representative for the consultative committee. That sets out the situation with the parties at the time they ratified the agreement. Now, the Emwest decision also made reference to what the parties had in mind at the time and what rights they could have left themselves at the time that they went ahead and formalised the agreement.

PN90

If I can take you to the Detmold Packaging Enterprise Agreement at clause 20 talks about reserve matters. As Ms Smith said, those matters were not included in the reserve matters and the parties would have been aware at the time that they negotiated the agreement, finalised it and then sought to have it proved by the Commission that to leave matters reserved in there would have reserved the right to take protected industrial action in relation to those matters. Certainly the agreement says there that during the life of the agreement and no later than 1.7.02:

PN91

...the consultative committee agreed to discuss measures pertaining to alone directing employees with specific gain share targets.

PN92

Then it lists a category of employees. He didn't refer to when the reserve matters, the protection of the accrued entitlements or the redundancy agreement or the excessive temperature of the Chapel Offices Charter. Clearly the parties' intention there was that they turn their mind at the time of negotiating the agreement and at the time of registering the agreement as to the matters about which they wanted to reserve their rights and those matters or that matter was listed in clause 20, as opposed to the document S1 dated 23 August 2001 prior to the ratification of the agreement. It sets out the matters that they will deal with on an informal basis. I think it was mentioned in the hearing before Senior Deputy President O'Callaghan that those other matters were being addressed in the informal setting and there was not an issue with them.

PN93

Nextly the agreement includes at clause 21 a "no extra claims" clause. Contrary to - the no extra claims clause gets a mention in the Emwest decision at paragraph 57. In that Kenny J said that the no extra claims clause was presumably negotiated with the agreement in mind and that agreement was that redundancy issues weren't going to form part of the initial - part of the main agreement but would be dropped and negotiated in the following year. Again Kenny J is looking at what the parties' intentions were at the time, did they include the no extra claims clause. We say there is evidence of what the parties' intentions were in relation to extra claims. Where you can anticipate that comes in in relation to this agreement is set out in paragraph 20. Where they are dealt with in a more informal way is dealt with in paragraph - in document S1, the final paragraph there.

PN94

The other important distinction that needs to be drawn too in relation to M-West is to clarify Ms Smith's submissions. She said that, well, the M-West decision was the same as what we had here in that we had one general certified agreement and there was a redundancy certified agreement with different expiry dates. That is not what we have here. We have one general certified agreement and we have a redundancy retrenchment agreement negotiated by the parties. It has been in place for a number of years. It has no expiry dated, it is not registered. It had never been in the contemplation of the parties that redundancy entitlements be part of a certified agreement and contrary to Ms Smith's submission likening this to Emwest, that was not in fact the case. The other cause of the - - -

PN95

SENIOR DEPUTY PRESIDENT MARSH: Mr Austin, you might be able to help me on a factual matter in the Emwest case. Was there a certified redundancy agreement in existence at the time?

PN96

MR AUSTIN: There was one - my understanding and recollection of M-West is that there was a - had been a certified redundancy agreement in place when that expired.

PN97

SENIOR DEPUTY PRESIDENT DUNCAN: I think paragraph 4 perhaps sets out the position in relation to the employees who were relevant to the decision.

PN98

SENIOR DEPUTY PRESIDENT MARSH: Yes, that is what I was looking for, thank you.

PN99

MR AUSTIN: I think it is the case, your Honour, that there was a redundancy agreement in place for the 1998 redundancy agreement which expired in 2000.

PN100

SENIOR DEPUTY PRESIDENT MARSH: Yes.

PN101

MR AUSTIN: I think that is an important distinction in relation to M-West. I think another important distinction is the fact that the parties had produced in writing what they were - was going to be agreed and separately from the agreement. Certainly in that, which has been signed up by both parties, no commitment that it should be formalised or ratified in the form of an agreement. I think again Emwest looked considerably at what the parties turned their mind to at the time that they certified the agreement and certainly if the parties wanted to keep open the right to take industrial action in this way, that there was plenty of room for this issue to be included in the reserve matters if that is what the employees or the AMWU intention was.

PN102

SENIOR DEPUTY PRESIDENT DUNCAN: What do you say to the proposition that the reserved rights are rights associated with the agreement, they are part of the agreement? These other matters, the redundancy matters, we can call them, were very clearly - the record is quite clear - were not to be part of the agreement in any way, shape or form. Aren't they at large?

PN103

MR AUSTIN: Well, not entirely at large but they are qualified by the fact that the references to the transcript that Ms Smith referred to about Mr Brown and then the other references here in exhibit S1, so they are not entirely at large because they have been talked about being resolved in an informal way through informal negotiation, to be the parties' intention, whereas if they were at large then it would be left open for the parties to negotiate them in a formal setting.

PN104

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, I accept that as part of your argument but it does not alter the fact that they are not contemplated by the agreement, the certified agreement.

PN105

MR AUSTIN: They are not referred to in the certified agreement at all.

PN106

SENIOR DEPUTY PRESIDENT DUNCAN: In no way.

PN107

MR AUSTIN: Certainly in relation to the timing of the issues the agreement was registered on 17 October 2001 and these matters were being discussed by the parties and negotiations taking place on 23 August by the date of the S1 exhibits.

PN108

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, although the document of 23 August simply says that they will be the subject of further discussion, does it not?

PN109

MR AUSTIN: Yes, actually it said - well, it talks about key points to the agreement. The third - - -

PN110

SENIOR DEPUTY PRESIDENT DUNCAN: The second dot point.

PN111

MR AUSTIN: - - - dot point of the first heading, it talks about productivity gain share. Then you see part of the game share was the matter that was kept as a lead reserved.

PN112

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, but that was acknowledged to be key points or changes to the agreement.

PN113

MR AUSTIN: Yes.

PN114

SENIOR DEPUTY PRESIDENT DUNCAN: At the foot of the page it is:

PN115

Other employee relations, initiatives, action approved and agreed separately from the agreement.

PN116

MR AUSTIN: Yes, sir. So whilst you say they are at large, the other issue is that they do relate to terms and conditions of their employment.

PN117

SENIOR DEPUTY PRESIDENT MARSH: They don't relate in any way to the agreement itself, the parameters of the certified agreement to which denotes to a claims provision - which forms a part of.

PN118

MR AUSTIN: Well, they are caught by the grievance procedure in the agreement, clause 18. It is not limited to just matters the subject of the agreement. It says that all parties to the agreement should try and avoid any forms of industrial disputation, including bans, limitations or restrictions to production. On it goes. Then over the page it mentions at point 1:

PN119

Notification to and consultation between enterprise consultative committee concerning any industrial issues.

PN120

So again it talks about any industrial issues, not just matters the subject of this agreement. Then it talks about if the issues are not resolved there would be a cooling-off period of 48 hours to facilitate conciliation and then either party may take preventative action to seek a resolution of possible industrial dispute in relation to the certified agreement by seeking the protection of the Industrial Relations Commission as per the Federal Industrial Relations Legislation. Now, that was an important part of the Senior Deputy President's decision in that he has said at page 23 of the appeal books at paragraph 120 of the transcript of 5 March:

PN121

It is my conclusion the parties entered into an agreement which does not envisage additional claims and which clearly prohibits industrial action in support of these claims. It is clear that other discussions and negotiations are proposed in relation to protection of employees' entitlements, redundancy, excessive temperatures in the Chapel Offices Charter. I consider any such discussion should be convened within the dispute resolution processes outlined by the agreement. They should not be subject to industrial action.

PN122

That is why we say that whilst these matters are not contained in the agreement, those four points, it was certainly not contemplated they be the subject of industrial action and that if the parties couldn't reach agreement they had available to them the dispute resolution procedures under clause 18 of the agreement and as a step in that process, if the parties didn't agree they would have been able to notify a dispute to the Commission and seek the Commission's assistance in resolving a dispute rather than resorting to taking industrial action.

PN123

SENIOR DEPUTY PRESIDENT MARSH: Yes, but under a 170LW the Commission's power is empowered with respect to the application of the agreement. If the Commission so approves, this is LW, procedures in the certified agreement from preventing the settling of disputes that is what you are taking us to, whose employment subject to the agreement may, if the Commission so approves empower the Commission to do it either or both of the following: (a) to settle disputes over the application of the agreement. That is the parameter of LW.

PN124

MR AUSTIN: Yes, ma'am.

PN125

SENIOR DEPUTY PRESIDENT MARSH: That is it is matters or issues covered by the agreement. So you are saying there is really a wider power under the clause 18 and that is that any dispute can be processed and brought to the Commission for settlement under clause 18 of the Detmold Packaging Agreement.

PN126

MR AUSTIN: Well, 170L(1) says that - talks about preventing the settling of disputes between employer and employees whose employment be subject to the agreement may, if the Commission so approves, empower the Commission to either or both of the following. We actually - - -

PN127

SENIOR DEPUTY PRESIDENT MARSH: Yes, (a) over the application of the agreement.

PN128

MR AUSTIN: It is in relation to the application of the agreement, yes.

PN129

SENIOR DEPUTY PRESIDENT MARSH: Yes, that is the parameters with which LW(1) empowers the Commission to settle disputes. I am just asking you to explain to how - to clarify how your submissions on clause 18 fit in with what the Commission is empowered to do under 170LW. You are saying, clause 18, as I understand and please correct me if I am misinterpreting you, you are saying that any matter can be raised and can be brought to the Commission for settlement - - -

PN130

MR AUSTIN: Yes.

PN131

SENIOR DEPUTY PRESIDENT MARSH: - - - under the disputes settling procedure.

PN132

MR AUSTIN: That is right.

PN133

SENIOR DEPUTY PRESIDENT MARSH: So LW is wide.

PN134

MR AUSTIN: LW just deals with the application of the agreement. We are saying, in this case, any employee or union subject to the agreement - who is subject to the agreement can bring or seek the assistance of the Commission under clause 18. It talks there about an internal in-house dispute resolution procedure then in the event that that is not successful referring the matter to the Commission for assistance. It is not limited to - it talks about notification to and consultation between the Enterprise Consultative Committee considering any industrial issues. Then if these issues are not resolved - a cooling off period then either party may take preventative action to seek the resolution to a possible industrial dispute.

PN135

SENIOR DEPUTY PRESIDENT MARSH: Yes, thank you.

PN136

MR AUSTIN: Thank you. Just in summary, I would like to refer back to Senior Deputy President O'Callaghan's reasons for his decision which are at page 22 of the appeal book at paragraph 118. It says:

PN137

That the agreement clause 18 contains a dispute resolution procedure which is clearly intended to avoid the need for industrial action.

PN138

That is not challenged as part of this appeal. Next again, there is a confirmation at paragraph 119 the second sentence there:

PN139

There is a series of issues relating to starting times and redundancy A ...(reads)... of the Workplace Relations Act.

PN140

Again, it is paragraph 120:

PN141

It is my conclusion the parties entered into an agreement which does ...(reads)... and not be the subject of industrial action.

PN142

Again, it has been nothing in the appellant's submission that says that the discussions that were proposed and were intended to be part of another enterprise agreement, there has been the - so the references to Mr Brown's submissions in the earlier transcript. Ms Regione indicating that it may have, in fact, been a registered agreement but then that's clarified by S1 which talks about being the more informal process. So I do - it is not a matter that is completely at large and where there is an unfettered ability to negotiate.

PN143

The parties by their conduct in negotiating the matter on an informal basis and actually by setting it out in an agreement that it is to be dealt with on an informal basis does provide a restriction on the basis to say: look, if they don't get what they want it is not covered by the agreement, then industrial action may be taken. Further again, I will just reinforce Senior Deputy President O'Callaghan's view of the dispute resolution procedures, it is put there for a purpose and that purpose being to provide the basis to deal with any industrial action or any industrial issues between the parties and that was available and not sort of used on this occasion. Those are my submissions.

PN144

SENIOR DEPUTY PRESIDENT MARSH: Thank you Mr West. Yes, thank you, Ms Smith.

PN145

MS SMITH: Your Honours, I am instructed by Mr Nicholson that when the enterprise agreement was certified this was deliberately done so without the redundancy clauses as the parties were unable to agree at that time and there was - it was agreed that there was no point in further holding up the certification of the enterprise agreement. However, I have no personal knowledge of that Mr Nicholson is here and may elaborate further should you wish.

PN146

COMMISSIONER McCUTCHEON: Was there a transcript taken at the certification proceeding?

PN147

MS SMITH: There was no discussion at the certification of the enterprise agreement with respect to the absence of a clause in relation to redundancy. My friend stated that I didn't outline the distinction between the N-West - I was of the opinion that I clearly stated the difference here is that Detmold Packaging have never had a certified redundancy agreement although they have had an unregistered agreement that has been in operation since 1995 and I understand that this has been honoured. However, that does not have an expiry date.

PN148

I just wish to make one comment with respect to the dispute resolution clause in our submission a dispute resolution clause in an enterprise agreement is not capable of expanding the powers and the jurisdiction of the Commission and section 170LW clearly limits the power of the Commission to settle disputes over the application of the agreement. This clearly cannot be the case in this situation. Those are our submissions, your Honour.

PN149

SENIOR DEPUTY PRESIDENT MARSH: Are you going to address us on leave, Ms Smith? Leave to appeal?

PN150

MS SMITH: Pardon?

PN151

SENIOR DEPUTY PRESIDENT MARSH: Were you going to address us on leave to appeal?

PN152

MS SMITH: I sought leave - the issue is of such importance the Senior Deputy President has placed a section 127(2) order on the AMWU and AMWU members at Detmold which is current until the life of the expiring of the agreement which is June 2003. It is the - and my learned friend has addressed the dispute resolution clause I could also point to the protected action clause in the Act that is there for a reason to enable the bargaining power of the parties to become more equal and not for an employer just to say: that is not included, we have got the agreement now, you didn't have it on leave reserved, it has got no further claims here, this is our final offer, take it or leave it.

PN153

That is the situation here, however, there were a few discussions which, in my view, should have happened much earlier prior to this hearing, but we had to inform my friend that we are unable to answer any offers or proposals that they must put forward because it is up, you know, to the members and it must go before them on a vote. So we would say this is a very important issue. It is probably - I don't know, Mr Nicholson may be able to answer why it wasn't put in the leave reserve clause.

PN154

If it was, we wouldn't be here before you today. However, it is clear that the parties intended to negotiate and certify a redundancy agreement prior to the end of last year. The enterprise agreement was certified on - we took Detmold Packaging's undertakings in good faith and unfortunately they have failed to act in good faith. Those are our submissions, your Honours.

PN155

SENIOR DEPUTY PRESIDENT MARCH: Yes, thank you.

PN156

SENIOR DEPUTY PRESIDENT DUNCAN: Ms Smith, are you saying that if the redundancy matter had been placed in the leave reserved part of the certified agreement protected industrial action would have been possible?

PN157

MS SMITH: No, I would say that then it would come within clause 18 of the dispute resolution clause and the Commission could come before and assist the parties in resolving the dispute because it would then be as part of the agreement.

PN158

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, Mr Austin may have a comment to make on this too, but as far as you are concerned I draw your attention to the last sentence at paragraph 58 of the N-West decision where her Honour says that:

PN159

No attempt was made by N-West at that time or at the hearing ...(reads)... no issue arises concerning the clause.

PN160

MS SMITH: Yes.

PN161

SENIOR DEPUTY PRESIDENT DUNCAN: You place a lot of weight on the N-West decision - - -

PN162

MS SMITH: Yes.

PN163

SENIOR DEPUTY PRESIDENT DUNCAN: - - - but it would appear that it specifically does not say anything at all about the effect of the "no extra claims clause". If that is so, I would like to hear from you as to why you think that the "no extra claims clause" which is not the most complex sentence I have ever struck in my career to date - - -

PN164

MS SMITH: Yes.

PN165

SENIOR DEPUTY PRESIDENT DUNCAN: - - - shouldn't be simply given its plain and ordinary meaning.

PN166

MS SMITH: Yes, as I said, your Honour, the "no extra claims clause" in our submissions would apply to the agreed matters within the agreement so then both parties can be reassured that what has been agreed will remain agreed until such time as when a new negotiation commences and further the parties could have chosen to put a clause in saying that this enterprise agreement covers the field in relation to the employee's covered and you know there would be nothing, you know, if something is missed out or not included then you would have to wait until the expiry of the agreement to address that issue, your Honour.

PN167

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, in short you are saying that the "no extra claims clause" relates only to matters within the agreement including, as it might be in your argument, reserved matters.

PN168

MS SMITH: Exactly, your Honour.

PN169

SENIOR DEPUTY PRESIDENT DUNCAN: Very well, thank you. Mr Austin, did you want to venture anything on the - I suppose we are really talking about the interpretation of the "no extra claims clause".

PN170

MR AUSTIN: Yes, sire, thank you. I see the "no extra claims clause" as speaking for itself and I was endeavouring to refer to that as a distinction with the N-West situation because there was no endeavour to rely on it in that case, but it states quite clearly that it is agreed during the life of the agreement that there would be no extra claims made by one party against the other. Now, it doesn't say no extra claims in relation to matters subject to this agreement. It just says there will be no extra claims made by one party against the other. The reserve matters tend to fit within that, well no other claims but it is subject to what sort of matters are left reserve or are still to be agreed.

PN171

SENIOR DEPUTY PRESIDENT DUNCAN: Yes.

PN172

MR AUSTIN: Apart from that it is very much a straight forward sentence, very much a plain English sentence without there being any risk of it being mis-understood.

PN173

SENIOR DEPUTY PRESIDENT DUNCAN: What weight do you say should be attached to the possibility that the employees were induced - I don't use that in a pejorative sense, to agree to the actual certified agreement by the fact that they were advised that there would be action approved and agreed separately from the agreement in relation to, amongst other things, redundancy.

PN174

MR AUSTIN: Well, I think it applies both ways, it would be the case of the employer would have been induced or encouraged to go ahead with the agreement as it stood in the expectation that something else could have been agreed separately.

PN175

SENIOR DEPUTY PRESIDENT DUNCAN: Yes, because it was a claim wasn't it. It was presumably a claim for improved redundancy payments. Yes, you can see how it gets - - -

PN176

MR AUSTIN: It was certainly up for discussion between the parties prior to this going on. I know I just don't - it is a matter for clarification, and I don't - it is not a matter that is the subject of appeal. Ms Smith is talking about the company not negotiating in good faith on this matter certainly that is something we take issue with and want that on record unanswered. In fact, the record can show that negotiations have continued. There has been correspondence in the matter as recently as the middle of last month in relation to further negotiation of the redundancy provisions between the company and the union.

PN177

SENIOR DEPUTY PRESIDENT MARSH: Mr Austin, I understand the interpretation of the no extra claims provision that you gave to his Honour. How does that interpretation sit in circumstances such as N-West where there were more than one parallel certified agreements in place? Is that a distinguishable aspect that in that matter there was, in fact, a specific redundancy agreement. Does that distinguish itself from the interpretation - - -

PN178

MR AUSTIN: I have certainly seen that as being the case - - -

PN179

SENIOR DEPUTY PRESIDENT MARSH: Yes.

PN180

MR AUSTIN: - - - with N-West otherwise you end up with the situation I think to the union's position there that if you had one agreement that had - that was still current and one agreement that was expired, that the application of a no further claims clause in that situation would prevent you from trying to negotiate the expired agreement.

PN181

SENIOR DEPUTY PRESIDENT MARSH: Yes.

PN182

MR AUSTIN: I see that as being an important distinction here. If that would be the case it would have to be ripped out.

PN183

SENIOR DEPUTY PRESIDENT MARSH: So that would distinguish the circumstances from - - -

PN184

MR AUSTIN: Yes, ma'am.

PN185

SENIOR DEPUTY PRESIDENT MARSH: Thank you. I understand, thank you. Well, thank you for the submissions. We will reserve our decision in this matter. The Commission stands adjourned.

ADJOURNED INDEFINITELY [11.42am]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #S1 AGREEMENT BETWEEN DETMOLD PACKAGING AND AMWU SIGNED BY MR BROWN PN30
EXHIBIT #S2 FINAL WRITTEN DOCUMENT PN45