C2002/3400, Transcript of Proceedings [2002] AIRCTrans 2740 (18 July 2002)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

JUSTICE MUNRO

C2002/3400

APPLICATION FOR AN ORDER TO STOP
OR PREVENT INDUSTRIAL ACTION

Application under section 127(2) of the Act
by Transfield Services (Australia) Pty Limited
and Automotive, Food, Metals, Engineering, Printing
and Kindred Industries Union and Others for an order
to stop or prevent industrial action at Transfield -
Shell Clyde Refinery

SYDNEY

4.23 PM, WEDNESDAY, 3 JULY 2002

PN1

HIS HONOUR: This is matter C3400 of 2002. It is an application lodged on 3 July this year, that is today at 1.30, seeking an order to stop or prevent industrial action in respect of industrial action alleged to be occurring at the Transfield Shell Clyde Refinery in the form of a stoppage commencing this morning and running through, it would appear, until Monday morning. The matter has been listed on very short notice. In anticipation I'm obliged to the respondents for attending having regard to the brevity of that notice. Could I have appearances, please?

PN2

MR T. DAVIES: If the Commission pleases, I seek leave to appear on behalf of Transfield Services (Australia) Pty Limited.

PN3

MR S. DIXON: If it please the Commission, I appear on behalf of the CFMEU, New South Wales Branch.

PN4

MR L. GILES: Your Honour, I appear for the AMWU.

PN5

MR D. WEIZMAN: If the Commission pleases, I appear for the CEPU.

PN6

MR M. McCANN: If the Commission pleases, I appear for the CEPU.

PN7

HIS HONOUR: Is there any objection to Mr Davies appearing?

PN8

MR DIXON: No, your Honour.

PN9

MR GILES: No, your Honour.

PN10

HIS HONOUR: There being no objection, leave is granted, Mr Davies.

PN11

MR DAVIES: Thank you, your Honour.

PN12

HIS HONOUR: What's the matter about?

PN13

MR DAVIES: Your Honour, I wonder whether I might start with a few housekeeping matters just very quickly. I note that the original application that was filed by facsimile this morning was unsigned by Blake Dawson Waldron. A signed copy has been faxed to each of the unions and I wish to hand up a copy of the signed order and ask under section 111(1), I think it's (q) that any defect in that procedure be waived. I also wish to correct a typographical error contained in one of the grounds of the application.

PN14

HIS HONOUR: Very well.

PN15

MR DAVIES: It's a typographical error that does go to substance as well. In paragraph 7 and I note the Commission noted this at the start, we've said:

PN16

Transfield is told that the employees are meeting on Monday to discuss their course of action.

PN17

That's not correct. We understand that the employees are meeting on Friday, returning to the workplace on Friday. We're not sure what will then happen on Friday. So I wonder whether either that whole sentence be deleted and I can just leave that for evidence might be the best way to deal with it.

PN18

HIS HONOUR: Very well. I note the substance of it. I'll mark at Transfield 1 the signed form of application. I think it has been faxed through but the one that's faxed through still hasn't been signed.

PN19

MR DAVIES: Thank you, your Honour. Your Honour, I do have with me copies of facsimile transmission reports for the notice of listing and applications having been filed but given the parties are all here, I don't propose to burden the Commission by handing those up unless the Commission wished me to do so.

PN20

HIS HONOUR: No, but I think you should express your indebtedness to the representatives, Mr Davies. Attending on such short notice is not a matter that I take for granted at least.

PN21

MR DAVIES: Yes, I think that's correct, your Honour, and I do with respect so. Your Honour, so far as the application is concerned today, it arises out of or as a consequence of strike action which has commenced today. It relates to employees who are covered by a certified agreement which is a multi party agreement, one made by a Full Bench of this Commission on 25 September last year called the Transfield Services and Alliance Contractors Refinery and Installations Certified Agreement 2001-2003.

PN22

That particular certified agreement applies to employees of Transfield Services (Australia) Pty Limited, the applicant in today's application and to other contractors who are engaged at the Shell Clyde Refinery and related sites. The application of the enterprise agreement under its clause 2 is that it applies to employees of the relevant companies listed in clause 3 and those companies include Transfield engaged on contracted maintenance and miscellaneous work as defined at Shell Clyde Refinery and the Bass Hill and Parramatta installations and Gore Bay terminals where contract maintenance and miscellaneous work is carried out.

PN23

It's the employees who are covered by this agreement who work at each of those sites employed by Transfield who are on strike at the moment which has given rise to Transfield's application before the Commission in these proceedings. By way of brief background, the company has some understanding of the cause of the strike action, although it would be fair to say it's a little unclear to the company why the action has taken place but by way of background, under the enterprise agreement clause 32 and appendix A5 and A6, there are three third party funds to which Transfield makes contributions and it's required to make those contributions under the enterprise agreement.

PN24

Those contributions are firstly in respect of super to one of various funds including C+BUS, a contribution in respect of redundancy again to another fund known as A-CIRT, A dash C-I-R-T and then there are contributions in respect of top up insurance which is workers compensation related and that fund is CTAS, C-T-A-S. It's become apparent in recent times that there have been discrepancies in relation to contributions made to various of those funds. In some instances, in error, moneys have not been paid and in some instances applications had not been filled in so that new employees were not recorded as being party to the fund and needing contributions made on their behalf.

PN25

Now, the company recognises that because it administers payments and it needs to make sure that application forms be filled in, that the mistakes were its fault and that it needed to correct those mistakes. It admitted those problems and held discussions with the various unions that are represented here today and asked for time to resolve the discrepancies. It needed time to resolve those discrepancies because it wished to conduct a complete audit in respect of every employee looking at their start date and what contributions had been made to each of the three funds on their behalf.

PN26

Then it set about fixing those problems to the extent that they existed. That has been taking place over the last two to three weeks. There was a meeting with delegates on 27 June where Transfield informed the delegates about what mistakes had been uncovered and the processes and steps that were taken to fix those mistakes and then a report back was scheduled for today.

PN27

In relation to these issues, I should say they were, we would say, escalated to step four of the dispute settlement procedure in the sense that Mr Lee, a representative of the company, and the unions were involved in the discussions to try and resolve these issues. Since those discussions and the audit have taken place, the company has now made all of the payments that it is required to make to each of the funds in respect of each of the employees concerned and I understand has provided detailed paperwork to the unions or at least made it available to them to look at, setting out what amounts of payments have been made, giving photocopies of the relevant cheques that have been sent off to each fund and the other paperwork so that it can be all clearly and properly checked to make sure that everything is up to date.

PN28

Now, so far as those cheques are concerned, as I understand it, in respect of one of the funds, the cheque was received by the fund and the proceeds are still waiting to be cleared. They've been cleared by the bank just in the ordinary course of the cheque being cleared. In respect of C+BUS, the cheques have been received and we understand that they're conducting their reconciliation, identifying each of the persons to whom the amounts relate and that money gets allocated. So the company has provided all the moneys to each of the funds and done everything within its power at this point in time.

PN29

Today the company made a commitment to the unions in respect of allocation to those funds. Those commitments were firstly that all third party funds were up to date in accordance with the proper procedures and in accordance with the enterprise agreements. Secondly, that each month the consultative committee will be provided with a print-out of the previous month's contributions and a copy of the cheque that's been sent off for those contributions so that they can be fully checked.

PN30

Thirdly, that if at any time there was to be a glitch, that no employee would be disadvantaged as a consequence of that glitch, that any error would be fully made up and indeed the company is required to do that under the enterprise agreement or it's in breach of the enterprise agreement. Fourthly, that a compliance manager has been engaged who has as part of the compliance manager's functions to ensure that all payments are up to date and correct and consultative committee members are permitted to contact that compliance manager as need be.

PN31

Those commitments were made in a meeting that took place today. The company understands that subsequent to that meeting, there was a meeting involving employees and I should say that in respect of this information that I'm providing, Mr Lee is available to give evidence if we do need that in the course of the hearing.

PN32

That meeting was held following those commitments having been made and everything having been confirmed as up to date and subsequent to the meeting of employees strike action as been commenced. The strike action commenced at about 11.20 this morning and, as I corrected earlier in the proceedings, we understand that employees are meeting back at the workplace on Friday morning, we don't have a commitment as to whether or not they will go back to work at that point in time but we understand that they will be back at the site. The employees concerned are members of and represented by the various unions that are involved in the proceedings today.

PN33

HIS HONOUR: What was the meeting this morning with whom was that meeting, that was prior to the meeting of employees, was it?

PN34

MR DAVIES: Yes, the company met with union officials and delegates, the consultative committee.

PN35

HIS HONOUR: The consultative committee presumably and the delegates reported to the stop work meeting or to a meeting of employees.

PN36

MR DAVIES: That's correct, yes, they then reported back to the employees thereafter. We're informed that the reason for the strike is that the employees are going out on strike until every red cent is paid. I think your Honour may recall I mentioned earlier that all cheques had been sent to the relevant funds and that copies of those had been provided to the unions, obviously, it's the banks that clear the cheques and in respect of all cheques that takes three to four days I think is the normal bank clearance. So there may be that people are saying we are out until the cheques are cleared and the other message is that if in the future any employees contributions to any of the funds are not made correctly then there will be a strike.

PN37

So the company regards the strike as a wildcat strike which is directed at punishing the company when the company has done everything within its power to fix up the mistakes, it has admitted the mistakes, it's done a full audit in respect of them and it has provided every piece of information that could reasonable be needed to check what the company has done in respect of making those corrections.

PN38

I should say in respect of the enterprise agreement itself that it's still within its nominal term, it was a three year enterprise agreement, I'm sorry, a two year agreement that expires in August 2003. The agreement contains in its dispute settlement procedure a not uncommon form of dispute settlement procedure where there are a number of hieratical steps when disputes arise of escalating the dispute and where a dispute is not resolved under clause 11.2 when settlement cannot be reached appropriate steps can be taken for the issue to be referred to the Australian Industrial Relations Commission.

PN39

HIS HONOUR: I'm broadly familiar with this matter as you no doubt appreciate, Mr Davies and Mr Dixon, but also there is a relative deja vu of the proceeding that was before the Commission on 22 March which I have familiarised myself with. Before that proceeding I was familiar with the Full Bench decision which made this or approved this agreement, the parties made it with Shell and while Mr Giles has replaced Mr Moore, I think, and I'm not sure that the CEPU was represented. I at least am broadly familiar but I haven't interrupted you earlier because I think it probably needs to be on the record.

PN40

MR DAVIES: Thank you, your Honour, I won't press on for very much longer at all because - - -

PN41

HIS HONOUR: I'm not critical of you but I'm just reassuring you that my recall is still adequate and being aided by transcript.

PN42

MR DAVIES: Your Honour, I should say in respect of the dispute settlement procedure that as the company understands that there is now resolution at step four of the procedure there was resolution, the commitments were made and the company understands the unions as being satisfied with those commitments and with the steps the company has taken. Notwithstanding that the employees have gone out on strike thereafter.

PN43

I was going to come very quickly to the orders that were made on the last occasion and perhaps I might hand a copy of those to my colleagues, and your Honour, I wonder whether I might hand up to you a copy of the order and the transcript just for the record on the last occasion.

PN44

HIS HONOUR: That will be Transfield 2, can be the transcript and Transfield 3 can be the order in print 915810.

EXHIBIT #TRANSFIELD 2 TRANSCRIPT

EXHIBIT #TRANSFIELD 3 ORDER IN PRINT 915810

PN45

MR DAVIES: Your Honour, I didn't wish to make a big song and dance about the previous proceedings, I wanted just to make three quick points about them. Firstly, that the order was made on 22 March 2002 in matter C2002/1569. Secondly, as to its term and date of effect those proceedings were on a Friday and the order was made as commencing with effect from 8.30 am the following Monday, 25 March 2002, and it is described as being in force for a period of three months. That is in force until Tuesday of last week. The second point that I brought was perhaps pertinent to raise was that on that occasion the strike also took place during the nominal term of the same enterprise agreement without the dispute settlement procedure having been followed. Your Honour, I think has just mentioned that you had a chance to peruse the transcript of those proceedings.

PN46

I don't propose then to read in any detail but to note that there were some comments made to the parties during the course of the proceedings, in particular, from about paragraph 70 just in respect of the importance during the term of the enterprise agreement and given the sorts of commitments that have been made in the multi-party agreements and the sensitivities of the site that there really should be a proper and concerted effort to follow dispute settlements procedures as the parties have agreed and to try and sort matters out in that manner and to add that bona fide Transfield has genuinely sought to resolve this issue and believes it has done so to the satisfaction of the unions.

PN47

The strike action does come at, well, I guess all strike action at the moment is quite sensitive, there is an HDS plant, a hydro desulphurisation plant project which is an extremely expensive project and a project that has been undertaken by the contractors and by Shell which has extended the life of the refinery in circumstances where it may otherwise have closed, and the parties to the enterprise agreement are remunerated or fees paid having regard to meeting certain key performance indicators, so any stoppage has a critical effect in terms of the probability of the project from the contractors point of view.

PN48

HIS HONOUR: Is that project currently under way, is it?

PN49

MR DAVIES: It is currently under way.

PN50

HIS HONOUR: What is the effect of the stoppage, does this mean that there is a pile up of overtime work or will people be normally working under the Transfield arrangements through the weekend anyhow.

PN51

MR DAVIES: There is a shutdown which is proposed and would be commencing at 7 o'clock tonight and three individual shutdowns are actually taking place so there is obviously a significant impact of the strike on that work. Otherwise, the strike continues to have effect on the other normal work which takes place at the site which is generally speaking day work.

PN52

HIS HONOUR: That's for Transfield.

PN53

MR DAVIES: For Transfield.

PN54

HIS HONOUR: What about for the employees themselves, are they correct in guessing that there can be a benefit to the employees out of it? What is it, a 48-hour stoppage if that what it proves to be and that work that would have been done can then be done at penalty rates?

PN55

MR DAVIES: It could be a result of the strike action. I can't say categorically it would be but certainly it is a distinct possibility because of the need to get back on schedule.

PN56

HIS HONOUR: I'm troubled by this matter, Mr Davies, and I might as well ventilate to you, concerns that the unions will need to address as to whether the power should be exercised. The first order was made in effect to give the company support in relation to a stoppage that to put it fairly plainly, I thought was unnecessary and over reaction to some deficiencies in supplying clean water to some location, that was the poly pipe to, I suppose, reduce it to a minor icon of it, incident. That order in accordance with the application ran for three months, I think, which expired on 25 June and then eventually within a week of its expiry and that may be entirely coincidental, the troops are out again for what may be 48 hours.

PN57

Now, on one view and this would be, I suppose, a view less sympathetic to you, they're going to go back probably on Friday morning and the reason they went out is related to the failure or inability or in any event a failure by the company to punctiliously apply or to adhere to perhaps even the obligations it has to make payments to the three funds. At least it's a pay back for that so I suppose in a sense the view on the shop floor is well, this is fair enough, it is intended to keep the company honest and of course, there is the other side that perhaps by keeping the company honest then people can have 48 hours off and still probably get nearly as much money by working double shifts or whatever is necessary to catch up.

PN58

The question for the Commission is whether it gives you the support of whatever force there is under a section 127 order in the circumstances. I would have to say that my perception has been that the powers in section 127 and before them in the bans clause can be deployed and are to be deployed where the merits of the case justify it. I'd also say that that cuts against the company. In fact, I made, I think, one of the first bans orders against an employer in this place for pretty much the sort of thing that the troops went out over here.

PN59

It was a major Newcastle retailer of vehicles who failed to make payments into one of the earlier C+BUS equivalents and thereby inadvertently I think, to some extent, but basically in self interest overlooked the fact that there was an insurance component that should have been paid and no great tribute to the union involved, it only came to notice when somebody died and the widow went along to claim the insurance benefit and it wasn't there because, oh dear, they hadn't got around to making the payment to the Newcastle fund that they wanted to and avoided the other fund.

PN60

Now, I issued a bans clause on that occasion to make sure, to adopt the lingo of the workplace, that every red cent was paid as quickly as it possibly could be and that every delay after a prospective date would add up as a continuing breach of the award. Whether that power is available or not in relation to agreements is a matter to be tested. I don't expect it would need to be tested in relation to Transfield because its conduct already indicates that it's acknowledged the defect and has made it good.

PN61

But I give the incident only to illustrate that at least as the Commission is constituted, unions would have a prospect under 170LW or under 127 of actually getting an order that cuts against a company that is in breach of what may be an important or an apparent breach of an important provision. In other words, the Commission would lend its weight to enforcing the act as best it could or using the powers of the act against a company that's showing not sufficient regard to the agreement.

PN62

The converse has to be or not has to be as the more usual case, that the same applies on the unions side. I must say, I'm at a bit of a loss why this site, this is the second time it's coming back. Are you really seeking an order? I don't think you've got much chance of getting an order from me to operate from 6pm tonight but you have a fairly good chance from about 7.30am tomorrow which is the commencement of the next shift and a near lay down misere chance in one sense, I wouldn't say it's quite that high perhaps, for the time that the employees resume from on - well, coming back for the meeting on Friday.

PN63

What purpose is an order going to serve and I don't want to give you overkill in relation to the area and I've tried to say that had the union come along and been faced with a situation where you weren't getting about complying with your obligations quick smart because somebody could die in the meantime and the insurer is under C+BUS or whatever, wouldn't have anybody to attach to them, could end up being a large amount of money. I assume they're the normal sorts of things.

PN64

The union might have got every bit of assistance of the kind that you're seeking and it probably would have been more effective in a sense because there would have been liabilities attaching to a failure to at least get the cheques in promptly. What benefit is it going to serve by making an order on this occasion?

PN65

MR DAVIES: Your Honour, we say that there are a number of benefits. Firstly, we say that it is important for both parties to comply with the enterprise agreement and we recognise that there was an error on the part of the company. I don't know if I clarified well enough, the error wasn't in respect of every employee. There were administrative glitches in respect of some employees, I think particularly some of the new starters. So it wasn't like the company was avoiding making payments but it made some errors.

PN66

We say it's important that both comply with the agreement. The company has made a special commitment in terms that nobody would be disadvantaged if there was ever to be a glitch and that commitment was made not because there's any intention that there be a glitch but from time to time mistakes are made accidentally. We say equally from the employees point of view, that it's also important to comply with the enterprise agreement.

PN67

The company's errors were non deliberate and we say that in respect of the employees on this occasion, there's very clearly a deliberate decision made after satisfaction has been expressed with the outcome to send that pay back message and that it is important that some form of order be in place so that employees understand clearly that the dispute settlement procedure agreed upon is to be followed and that it ought not be deliberately breached.

PN68

Secondly, there are a number of significant implications on the project and that's obviously detriment not only to the company but to employees of the form of strike action in circumstances where it does have to compete with competitors for work. The contractors who are together covered by the agreement don't have any sole right to work at the site and they need to perform. The sorts of stoppages that are taking place where the dispute settlement procedure is not being followed are causing harm to the company in a number of ways. I mentioned before not meeting certain KPI measures but in addition to that there are fixed costs that are incurred each time these sorts of strike actions occur, such as other plant and equipment which is on site at a cost and is idle. There is that risk, if the work isn't being performed properly, that there can be loss of contracts.

PN69

We say that the orders are terribly important so that where there are these sorts of disputes the proper process is followed and this Commission has been allocated the position on the parts of the parties of determining, if there is an unresolved dispute between them, how that dispute might be resolved. The company is committed to that process and says that it's important that employees understand the commit to that process as well. I don't know if there's anything I wish to add at this stage, your Honour.

PN70

HIS HONOUR: Yes, thank you, Mr Davies. Yes, Mr Dixon?

PN71

MR DIXON: Your Honour, I don't know that there's much point in requiring the company to call evidence and bring evidence about whether or not there is industrial action. There is. That's quite clear. The men are not at work.

PN72

I think the background to this issue is that there have certainly been numerous problems over time with some employees not having money allocated to their respective funds, whether that be their redundancy fund, their superannuation fund, and so on. There have been negotiations on the issue on site. There was a meeting this morning, as the company has explained. There was a breakdown of people who had not been allocated payments, as it was our understanding that it was resolved.

PN73

We then went to a report-back meeting of the workforce to explain to them what steps had been taken to sort out these issues. then there was a small avalanche of people standing up saying that they had contacted their redundancy fund and their superannuation fund as late as yesterday afternoon, and some this morning, and saying they were informed that they didn't have any money in their account for their period of employment on this site.

PN74

So it became obvious that, regardless of what we believed the facts we, the workers are fairly steamed up about it and they have hit the toe. I'm concerned that to try and organise an orderly return to work prior to Friday could well be disastrous. My assessment is that there is a large number of itinerant workers on the job. It's not simply a normal maintenance program at the moment. There is mechanical construction going on on the site and it's my view there are a lot of people who are itinerant and from other states and other towns and I would be concerned about how we would go about organising another meeting to speak to the workers prior to the next scheduled meeting on Friday. Maybe I'll leave my comments at that, your Honour.

PN75

HIS HONOUR: Yes, thank you, Mr Dixon? Mr Giles?

PN76

MR GILES: Yes, your Honour, I'll just be brief. I would just like to indicate that I'm not privy to the information in relation to the previous dispute but I would like to say a few works in relation to this one.

PN77

When I was filling in for Alan Moore last year for a period of time I was called onto the site for this very problem so it has been an on again off again problem, if you like and it's not been something that has just flared up recently. It has been an ongoing thing. It seems to be fixed and then it's not and then it is and then it's not. So there are problems there that have existed for a period of time, which has in itself created frustration - beyond belief actually. I've never seen so many heated up and frustrated workers. It has played upon them. Where money is concerned people are, with good cause, concerned.

PN78

As I say, it's been a problem. They've waited a long time to get satisfaction. We stood up with our hands on our hearts and we said to them that it was all fixed. They had given the company a period of time to rectify the problems and, as Mr Dixon just indicated, there were people this morning speaking up and saying they contacted their financial institution as recently as this morning, around 9 am I think the times were, and the money hadn't been paid at that stage, which does create a lot of distrust, even though the cheques were sent forward when we were assured by the company they were. It's hard to explain to a group of workers that the amount of time that they have put in waiting for an outcome still has arrived but it doesn't appear to have arrived. It's a very difficult thing.

PN79

I spoke to Mr Lee on Monday in regard to the matter. It told him that there was an extreme element of frustration on the site - I think my terminology was "a simmering pot" - and we discussed the matter at that stage and I indicated to Mr Lee that swift and efficient action had to take place to rectify the problem before it got to this stage.

PN80

We feel that we have followed the disputes procedure so I tend to disagree with the comments that were made earlier. We also acknowledge, and your Honour acknowledges, that there is an EBA breach on both sides here and a potential one in the future. I would like to leave it at that and just indicate that there is a very frustrating and very heartfelt situation. Thank you very much.

PN81

HIS HONOUR: Yes, thank you, Mr Giles.

PN82

MR McCANN: If the Commission pleases, this is a matter I have probably had more involvement with than my colleague from the CEPU, Mr Weizman. He may wish to add some comments about the meeting today because he was actually in attendance at the meeting today. I could not make myself available for that meeting but I have been dealing with this issue of the non-payment of entitlements for some time now, several weeks.

PN83

I think a couple of other matters that need to be pointed out are that part of the frustration for the employees and the delegates concerned is that they feel they have been told untruths in this matter. Originally, when this issue was first raised by myself with several representatives of Transfield, documentation was provided that alluded to the money having been paid when in fact no money had actually been passed on the relevant fund administrators. This was later admitted in meetings had with management and the delegates, that some untruths had been told.

PN84

I also had a discussion with Mr Lee some weeks ago over this matter and I feel it's the recalcitrant nature of this neglect in paying these things that has brought this matter to a head, as my colleagues have concurred. One of the comments made by Mr Lee in my conversation with him on the phone was, "We get this wrong every year, we've got to drag our line managers in and fix this problem once and for all". If I had had more time, your Honour, I would have liked actually to have had the opportunity to back-track some records of the MERC fund which we had in our keeping at the ETU office and actually see if I could verify that there had been under-payments in the past. I'll leave that as my submission, your Honour.

PN85

HIS HONOUR: Yes, thank you, Mr McCann. Did you wish to add anything, Mr Weizman?

PN86

MR WEIZMAN: Just one little thing, your Honour: with some of the different crowds from Victoria talking about administration problems - well, today we discussed, from their part, when workers started that they were told not to fill out forms. So they haven't even got their system in place whereby the employees can get paid their right entitlements from the beginning. It's taken, to this stage, for them to realise to employ somebody to their compliance officer. It hasn't just happened now. As my colleague McCann said, it's been happening over a period of time. Thank you.

PN87

HIS HONOUR: Mr Davies?

PN88

MR DAVIES: Just very briefly in response, your Honour. In respect of the breaches and the comments that have been made there, I think Mr Weizman made a comment at the end that I just wish to clarify for the Commission that one consequence of the errors has been the employment of a full time employee as compliance manager and the making available of that person to members of the consultative committee so that delegates can actually contact that person in relation to compliance with the relevant commitments that we're required to make to the various funds.

PN89

I guess another point in respect of that whole issue of trying to clear things up that we say in the circumstances where materials including copies of cheques had been provided to the unions that there certainly could have been a two day delay to make sure that those cheques had cleared. If they hadn't cleared within the normal relevant time, then of course, employees would again raise the issue, but it really was an appropriate time where perhaps another 48 hours of patience would have resolved that where clearly documentation had been provided.

PN90

In respect of difficulties getting employees back to work, I'm instructed that there are supervisors available and with contact numbers of the relevant employees, that the company is happy together with the union or in any fashion needed to contact the relevant people required to be back at work tomorrow if the Commission was to make an order or minded to make an order that commence from tomorrow morning and really the commitment is there for resources from the company side as well to make that happen.

PN91

The people who would be asked to turn up would normally have to turn up for work on that occasion anyway. That's still some 14-1/2 hours away.

PN92

HIS HONOUR: How practical is that going to be, Mr Davies, though? I have to say forthrightly that I'm adverse to services of notices on people at their homes at night and it's one thing where there is, I suppose, a genuine disposition to bring industrial action to an end and the union can assist in bringing it about but in a practical sense, it's a pretty tall task that you're placing on both union officials and sometimes on your own supervisors to get people back if they've been at a mass meeting.

PN93

Some individuals may be disposed to come back but others are not. Again I don't make apology for it. I tend to, I suppose, lean toward the pragmatic acceptance that I try to make my orders operate from the first sensible opportunity for there to be a meeting. I can indicate to you that I'm disposed to make an order with some reluctance but I would be inclined to make it from Friday morning rather than go through asking people really to do something.

PN94

It's pretty difficult to get people to turn up beforehand if there was some disposition on the part of the union to reach a compromise to say well, look, we'll try to get them back. I'd be prepared to go recommendation courses and so on but a recommendation seems an ineffective way. An order to come back when people are out and are not readily contactable effectively only binds the union unless it's to be enforced pretty rapidly.

PN95

I'm disposed to make an order because there's already been one order in this area and as I explained on the last occasion, I consider that the agreement in this instance particularly should be made to work and whatever anger the employees may feel about issues should be suppressed enough to save it up until they've exhausted the remedies that are available under the dispute resolution procedure.

PN96

It's for that reason that this is the second strike in a baseball sense, there's been one order which was of limited duration of three months and here we go again, the troops on the site have got angry about something where on this occasion the officials as I gather have said well, we've got it in hand. So you'll get your order, not that I think it's going to be a panacea for everything, but at least it's designed to say this is an important agreement, it binds Shell in circumstance or binds those working for Shell in the circumstances where labour hire are coming onto a site.

PN97

It's not without problems for Shell as we said at Full Bench level when it was a multi business agreement approved in the public interest with some jeopardy under the Trade Practices Act. The employees have got to make it work otherwise the model that you've got and it is something of a model at least in my experience, is going to be held out and ridiculed because the troops on the site haven't got enough sense to realise that they're not operating in 1960 or 1980, they're operating under this act under these arrangements and they've got to stick by the deals that they through their officials make and that's essentially the lesson the Commission is, I think, obliged to deliver in these matters, and some reluctance on my part.

PN98

I don't like making orders that unduly limit people and that's why in the Rheem case there's no order made yet because the intention was to give the troops a chance to make it. That's one reason why I didn't fiddle around with the three month on the last occasion. Okay, you're enjoined by the Commission not to go out for three months and it's no sooner over than out they go again in relation to a problem that their officials have negotiated through them which is virtually solved.

PN99

I understand what Mr McCann says. There aren't too many people who don't know that it takes time for cheques to clear. If there are foul ups over new entries to funds, they're going to take time to process. It seems to me that it's basically an assertion of workplace strength and that's the reason why I'll make the order but if it is that case, that's all the more reason why. It's pretty futile really, isn't it, to be expecting people to come back tomorrow.

PN100

MR DAVIES: I wonder whether the Commission might be minded to make the order effective from Friday as it suggested perhaps to recommend that if the parties were able to get a meeting earlier - - -

PN101

HIS HONOUR: I'm certainly prepared to accede to that. It would be my strong recommendation that there be a resumption as a matter of goodwill as soon as practicable.

PN102

MR DAVIES: Thank you, your Honour. If the Commission pleases.

PN103

HIS HONOUR: Well, in relation to the matter for determination, it is an application under section 127 for an order in effect restraining the continuation of resumption of industrial action. The industrial action is occurring at the Shell Clyde Refinery as I understand it. The industrial action is directed effectively in protest at delays in making good payments to funds that are provided for under the agreement that binds the site or the sites, that is the Transfield Services and Alliance Contractors Refinery and Installation Certified Agreement 2001-2003.

PN104

That lack of payment or delay in payment is related to issues that arose in negotiations that have been progressed to a certain stage through the dispute resolution procedure. It appears that Transfield are the respondent employer to this multi business agreement, has acknowledged that there were faults on its part and has taken steps to make good those faults.

PN105

I take into account the industrial action is at least in part a recrimination against some deficiencies in the uniform application or payment of entitlements. However, I am placed in a situation where it's manifest that the jurisdictional requirements for the exercise of the power under section 127 are clearly made out. The work or employment in question is regulated by a certified agreement. There is industrial action occurring.

PN106

I have to say that I find also that having regard to this being a reiterare or a renewal or a recommencement of industrial action after the expiry of a section 127 order made on 22 March 2002 in print 915810 that I am of the state of mind or satisfaction that there is a likelihood of further industrial action occurring. That likelihood is caused because there has been one set of industrial action in breach of section 170MN by employees covered by the agreement. That set of industrial action related to concerns about the failure to provide clean water to a particular part of the site after some delay. At the time I made that order, I sought to make clear the importance that the Commission attached to the particular agreement in this instance being observed and honoured by those bound by it.

PN107

I stress that the agreement is of a relatively singular character. It is an agreement binding multiple businesses. It was approved by a Full Bench. It binds as employers a number of labour hire companies providing services, if I can call them labour hire companies I do so, providing services to Shell at its various refinery operations. It is relatively unusual and as I have said, somewhat intrepid or bold for the respective employer parties to have made the arrangement that is reflected in the agreement.

PN108

The Full Bench when it made the agreement stated that. I won't repeat the terms of the Full Bench statement but it is set out in print 908683. The employees should understand that they should not take for granted that they will have a repetition of an agreement that should be treated as something of a model worth preserving.

PN109

On 22 March, I said and I paraphrase more or less what I said. The employees at the site need to be told that where there is a failure to accord with the substance of the agreement and the dispute resolution procedure, the Commission will waste no time whatever in making as effective as it can the embargo in the act against industrial action being taken.

PN110

I myself would regard almost as illegitimate by definition industrial action at that site that does not go through the disputes resolution procedure. If the worst comes to the worst at the end of that procedure, you have a board of reference. If you agree on it, I think access to the Commission. If you have not, well, that should be sorted through. It seems to me that it ill behoves major unions, the two that are here today and the one that Mr Moore represents, the major unions in this area, not to be making it very clear to people that when they get an agreement of this kind, they stick to it and make it work.

PN111

I won't read out the rest of what I said but I will put it into the reasons for decision that I publish. I add to that the observation that I made today to Mr Davies who appeared on behalf of Transfield. Had the union come or the unions come under a section 127 or any other heading and sought to enlist the Commission's aid by making orders of whatever kind were within jurisdiction against the company for failure to make the payments, then it could have expected and probably would have got from the Commission with alacrity, the use of the Commission's powers to require the company to comply with its side of the agreement under penalty.

PN112

I'm not saying that I know what form that order would take or what form that penalty would be. However, I instanced one of the first bans clauses that were made against an employer in the Commission at least on my time in it which related to a failure by an employer to make timely payments and to enter into a superannuation fund.

PN113

The power of the Commission in this sense cuts both ways, but I expect that employees understand that they have an obligation to go through the processes of their agreement and to go then through those processes to have access to the Commission's powers and so far as practicable, they can expected them to be exercised in a proper case.

PN114

As I've said, the power cuts both ways. I cannot underline enough the importance that I attach to this agreement being made to work by all concerned. I do not consider, resort to a 24 or 48-hour stoppage in relation to this issue having regard to the progress that was made in resolving it as a serious attempt to make the agreement work. It smacks to me of an old style attitude that the troops on the shop floor should show a bit of muscle to, I suppose, put the company onto the back foot as a recrimination against what is seen to be proper action by it.

PN115

It smacks to me too of industrial action that probably has its own reward in terms of getting heightened access to penalty payments. It's a pretty old device. It's been in operation in many union sites, hot shops for many years, the most notable of which was Redfern Mail Exchange. Have the stoppage during the week and pick up the penalty payments on the weekend and you've paid for your couple of days in the sun. Well, that's not the way this agreement should be made to work.

PN116

There are employees under similar arrangements or subject to similar pressures and cost restraints in Brisbane, in Melbourne, on manufacturing sites across the nation and if the Shell Refinery workers can't make this sort of agreement work, then it ill behoves other employees at other sites who hope to get this sort of model followed. That's one reason why at least with the Commission as constituted, the union side would have difficulty persuading me not to give the company the order that it seeks on this occasion.

PN117

I am not one who thinks that the section 127 order will resolve all problems at the site or forever stop industrial action. It simply is another step in the process and if the company wants to enforce it, then it will have to go to the Federal Court, but a section 127 order is about the only step that is within the Commission's power to indicate the height of which it seeks to discourage industrial action during the life of an agreement.

PN118

I have made a strong recommendation that there be as soon as practicable a resumption of work. The root industrial issue at stake has been solved or has been largely solved. If it is not completely solved in a timely way then you have almost an invitation from the Commission to bring it back and it will be resolved.

PN119

In relation to the timing of the order, I will, out of acknowledgment of two factors, defer its implementation until there has been an opportunity for the resumption of work on Friday morning. I do that, firstly, out of recognition of the ostensible reason for the industrial action and, secondly, out of recognition that the practicability of compelling people to return to work before that time is difficult. It's particularly difficult, I think, for union officials and it may be productive of disruption on the site if it is seen to be other than brought about as a measure of goodwill or co-operation through the union applying its best offices where it can. I've made the recommendation for that reason in the hope that those good offices will be used but I'll leave that to the parties to sort out.

PN120

As to the terms of the order: there are, again I have to say, some variations from the draft that is submitted by Mr Davies. They are fairly minor. I am now, for future reference, of a mind to follow pretty rigorously the draft order that I devised in the Rheem matter with which, I think, Mr Davies would probably be familiar. For the sake of the reference I indicate that it's in print 917617. It's a draft attached to it.

PN121

There are only minor differences but one important feature is the attempt in the direction to make the order binding upon employee - not so much binding upon employees but to direct that any enforcement be only in respect of industrial action after the order has been served, so far as it goes, to individual employees. That consideration may be of some importance to the ongoing life of the order.

PN122

I would indicate that the order will operate for the remainder of the life of the agreement. The purpose in making the order extend over that term is again to reinforce the view that the system that we have entitles employees to collectively bargain for an agreement for a particular term. During that period they may take industrial action but it is protected. That opportunity should be used and the agreements that are then struck should be abided by. The Commission order in this instance will simply reinforce what the Act already says in section 170MM. It probably means, however, though, having regard to the terms of the order, that any process, if it has to be taken at court level, will be clearer and more expeditious.

PN123

For the purposes of the employees it is intended as a direct reinforcement of the message that they should abide by the agreement and, if there are deficiencies in it, either use the dispute resolution process in the expectation that they will get hopefully a just hearing from the Commission or from the processes that you have or, if that is not satisfactory, they must await the opportunity, in I think it's August next year, to overcome the deficiencies in the agreement through compelling from the company rectification of any of those deficiencies.

PN124

I'll publish reasons for decision in due course. The order will issue some time tomorrow and be sent out to the parties. The respective times from which it's operating are more or less in terms of the draft. So far as the duties are concerned, they will be made to commence from 7.30am on Friday morning. Very well, the Commission will adjourn.

ADJOURNED INDEFINITELY [5.28pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #TRANSFIELD 2 TRANSCRIPT PN45
EXHIBIT #TRANSFIELD 3 ORDER IN PRINT 915810 PN45