AG2002/2802, Transcript of Proceedings [2002] AIRCTrans 3171 (16 August 2002)

AUSCRIPT PTY LTD
ABN 76 082 664 220

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

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

AG2002/2802

LK VINYARD MANAGEMENT CERTIFIED
AGREEMENT 2002

Application under section 170LK of the Act
by LK Vineyard Management Pty Limited re
agreement with employees (Division 2)

ADELAIDE

10.05 AM, FRIDAY, 2 AUGUST 2002

PN1

THE SENIOR DEPUTY PRESIDENT: Good morning, can I have some appearances please.

PN2

MR C. CINI: Yes, I appear for the Farmers' Federation.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Cini. I understand I have Mr David Gill on the telephone link, is that correct? Hello, have I got Mr David Gill on the phone?

PN4

MR D. GILL: Yes, I'm sorry, it is very hard to hear you.

PN5

THE SENIOR DEPUTY PRESIDENT: That is all right, thank you, Mr Gill. Mr Cini.

PN6

MR CINI: Sir, this is an application under Division 2 of the Part 6B for Certified Agreement. The parties signed off on this agreement on 2 July and the agreement was lodged with the Commission on 23 July. As we know, Mr Gill, here has been nominated as the employee representative.

PN7

THE SENIOR DEPUTY PRESIDENT: Well, we don't yet, Mr Cini.

PN8

MR CINI: Sorry.

PN9

THE SENIOR DEPUTY PRESIDENT: But I guess we will find out.

PN10

MR CINI: I see, okay, sorry, Commissioner. The Certified Agreement sets in place a number of benefits for the parties, including the recognition that it is a vineyard which is a little more specific than the current provision of the award, which tends to be general across a number of areas. It also sets in place a reduction in the ordinary hours as against the award. The award specifies 152 hours for station hands and 160 for shearers, whereas, this agreement puts in place 150 hours over 4 weeks.

PN11

THE SENIOR DEPUTY PRESIDENT: Does it, Mr Cini?

PN12

MR CINI: If you will bear with me, I will go to the clause. Clause 9(a)(1).

PN13

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Cini, I do have significant questions relative to that clause and I'm not sure I accept what you are saying, but I understand what it is you are saying.

PN14

MR CINI: Right.

PN15

THE SENIOR DEPUTY PRESIDENT: That clause simply indicates, as I read it, that the minimum hours are - sorry, that the ordinary hours are a minimum of 150 hours in a 4-week period.

PN16

MR CINI: You are certainly quite correct, sir.

PN17

THE SENIOR DEPUTY PRESIDENT: They don't specify the maximum.

PN18

MR CINI: Yes, it does not specify maximum. 9(a)(4) does limit the span of hours, but I appreciate the point you are making, sir.

PN19

THE SENIOR DEPUTY PRESIDENT: It is a fairly substantial point we may have to return to later.

PN20

MR CINI: Yes, sir, yes. In relation to the wages, the agreement specifies a minimum of 28,000 - and I will refer you to it - clause 10.2, states that: the minimum rate for an adult is 28,000. Using a ballpark figure, sir, the award at the top end, that is a senior station hand rate, is $463.50 per week, which is - - -

PN21

THE SENIOR DEPUTY PRESIDENT: Mr Cini, you have referred a couple of times to "the award". The only statutory declaration that I have in relation to this matter simply references the Pastoral Industry Award. It does not indicate whether or not the parties intend to reference, or consider that the Federal Pastoral Industry Award is the appropriate award, or indeed, that that travesty of an award in terms of a safety net, being the Pastoral Industry (South Australia) Award, is the safety net.

PN22

MR CINI: In the agreement - sorry, in the application, I saw reference to the Pastoral Industry Award, or is it 1998, which I thought was reference to the Federal Award.

PN23

THE SENIOR DEPUTY PRESIDENT: Is the employer a respondent to that award?

PN24

MR CINI: As a member of the Federation, I would expect they would be.

PN25

THE SENIOR DEPUTY PRESIDENT: Well, this is just the question that I'm asking.

PN26

MR CINI: Yes, sir, look, to the best of my knowledge, that is the case.

PN27

THE SENIOR DEPUTY PRESIDENT: Thank you. So it is the Federal Award that you are referring to?

PN28

MR CINI: It is the Federal Award. Clause 1 of the agreement, the title, refers to the Pastoral Industry Award 1998, whereas the State Award has got a different year. The views I'm expressing are based on that provision there.

PN29

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, that is why obviously I was asking the question, because of the very substantial difference between the rates of pay and the State and Federal Awards.

PN30

MR CINI: Yes, sir, bearing in mind the State one has not been varied for about 12 years.

PN31

THE SENIOR DEPUTY PRESIDENT: Yes.

PN32

MR CINI: I appreciate your concern with that.

PN33

THE SENIOR DEPUTY PRESIDENT: Yes, indeed, and hence I called it somewhat of a travesty in terms of the safety net.

PN34

MR CINI: Yes. So in relation to the wages aspect, sir, we say that there is an increase on the minimum of the award rate, but I appreciate the earlier point you made about the hours being specified as a minimum as well, so if you like there is about a $5000 leeway between the ordinary rates prescribed in the award, as against the amount that the employees in this case are being paid, approximately, I'm using ballpark figures.

PN35

THE SENIOR DEPUTY PRESIDENT: Yes.

PN36

MR CINI: There is also provision in the agreement in clause 7 that the company will operate and try and beat the requirements of the Vineyard Quality Assurance Program, which obviously has some benefits for the workplace, both in presumably safety records and also quality of the product. The agreement also recognises that the workload may fluctuate, depending on the season and whether they are harvesting, or whatever else they do. Whereas, the Federal Award treats every week as being the same in many respects.

PN37

There are provisions in this agreement for an ongoing relationship on a casual basis but, as you can see sir in an industry like this, there is some flexibility required. There is a provision for four consecutive hours on any one day in clause 9(b)(3), so that employees who travel from nearby areas, at least, have got some assurance that they are going to earn a reasonable income for the day. The probationary employees are mentioned and there is provision there in the agreement to engage them on that basis. Equally, the agreement recognises the traineeships that are available in the industry.

PN38

The junior rates in clause 10.6 are the hourly rate, it is higher than the Federal Pastoral Industry Award, and the junior rates cease at age 18, as against 21 in the award. Looking at the minimum rate for an adult casual, it is above the award rate sir and that is $13 an hour and it is currently $12.78 in the award. Sir, there is probably not much else I can add to it. There is the standard requirements of grievance settling and dispute resolution in the award anti-discrimination provisions and it sets in place a document from which the parties can work for the next 3 years.

PN39

THE SENIOR DEPUTY PRESIDENT: Mr Cini, before I ask Mr Gill to comment, what can you tell me about the information that was provided to the employees in order to allow them to make an informed decision, relative to the agreement and, in particular, can you tell me whether there was an indication given to those employees that, had they wanted to have a union involved in the process, they could do so?

PN40

MR CINI: Sir, the information that I have in relation to that is only what has been provided in the application and there was in there a statement that the employees were consulted. To the extent of what involvement, or what opportunity they were given, regarding having a union present, I'm not entirely clear on and I would be quite reliant on someone like Mr Gill, who is no doubt aware of what went on but, unfortunately, I'm disadvantaged here, sir.

PN41

THE SENIOR DEPUTY PRESIDENT: Thank you. Can you tell me what period of notice the employees had of the agreement, prior to their endorsement of it?

PN42

MR CINI: In Part 5 of the application, sir, 5.1, it is indicated there that they were given a copy of the agreement, time to pursue it - and in brackets "(7 days)". There was group clarification and discussion and then signed. I don't know if the signature occurred at the end of the 7 days, or whether there was a subsequent period beyond that.

PN43

THE SENIOR DEPUTY PRESIDENT: You see, can I refer you to section 170LK(2) of the Act, do you have the Act there?

PN44

MR CINI: I don't have it with me, sir.

PN45

THE SENIOR DEPUTY PRESIDENT: Well, Section 170LK(2), says, and I quote - perhaps before I do quote - Mr Gill, I'm presuming you can still hear me, is that correct? Mr Gill?

PN46

MR GILL: I'm sorry, I'm having trouble hearing.

PN47

THE SENIOR DEPUTY PRESIDENT: Very well, look, we will endeavour to move the telephone so you can hear more clearly. Mr Gill, I'm asking Mr Cini some questions about the process that was put in place to allow employees to consider the agreement before they voted on it.

PN48

MR GILL: I cannot hear anything now.

PN49

THE SENIOR DEPUTY PRESIDENT: Can you hear me now?

PN50

MR GILL: Vaguely.

PN51

THE COMMISSION: Is there another phone handy, Mr Gill, apart from your mobile?

PN52

MR GILL: Yes, if I can try and locate another phone.

PN53

THE COMMISSION: That is probably a better idea. Well, perhaps I will just disconnect. Do you have that number handy?

PN54

MR GILL: Yes, 88434090.

PN55

THE COMMISSION: 88434090.

PN56

MR GILL: Yes.

PN57

THE COMMISSION: All right, perhaps if you could hang up from your mobile and I will try ringing that number.

PN58

MR GILL: Okay.

PN59

THE SENIOR DEPUTY PRESIDENT: We will adjourn these proceedings for a short time.

SHORT ADJOURNMENT [10.20am]

RESUMED [10.25am]

PN60

THE SENIOR DEPUTY PRESIDENT: Mr Gill, we have re-convened this hearing. What has happened to date is that Mr Cini has taken me through various of the provisions in the proposed agreement and I am now asking him a couple of questions that go to the process, whereby, the employees had an opportunity to consider the agreement in advance of indicating their support for it. Can you hear me now.

PN61

MR GILL: Very faint, but it will do .....

PN62

THE SENIOR DEPUTY PRESIDENT: Very well, I will endeavour to speak up so that you can hear me. Mr Cini, can I refer you to section 170LK(2) of the Act, which reads:

PN63

The employer must take reasonable steps to ensure that every person employed at the time, whose employment will be subject to the agreement, has at least 14 days notice in writing of intention to make the agreement, and the agreement must not be made before those 14 days have passed.

PN64

The issue that I'm specifically raising with you is the difficulty I am having in reconciling that requirement under the Act with the response to the question raised in 5.1 of the employer's statutory declaration.

PN65

MR CINI: Sir, I'm reading it in conjunction with 5.6, where the employer has indicated that the 14 days was given and that a notice R40 was given to all employees. So whilst before we had communication problems - whilst in one area there is reference to 7 days in 5.1, in 5.6 there is reference to the 14 days having been given.

PN66

THE SENIOR DEPUTY PRESIDENT: You have no further information beyond that?

PN67

MR CINI: No, sir, no.

PN68

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN69

MR CINI: Thank you.

PN70

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, Mr Gill, I understand you are here representing the employees, who are covered by this agreement, is that the case?

PN71

MR GILL: Yes, that is right.

PN72

THE SENIOR DEPUTY PRESIDENT: Can you tell me how it is that you come to be representing those employees?

PN73

MR GILL: I'm one of the most senior of the employees.

PN74

THE SENIOR DEPUTY PRESIDENT: And have they asked that you represent them?

PN75

MR GILL: Yes.

PN76

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, can you tell me first of all, what period of notice that you had from the employer of the proposed agreement before you indicated your support to it?

PN77

MR GILL: The first things that we have spoken about had been spoken about for some time. We were given a draft copy which we had for several weeks, then we got together probably a week before we signed it and went through it all and then we were looking at whether to make any changes we needed and then it was signed .....

PN78

THE SENIOR DEPUTY PRESIDENT: Were any changes made in that week before the agreement was signed?

PN79

MR GILL: No, there were no changes made.

PN80

THE SENIOR DEPUTY PRESIDENT: So I can fairly say that you had a copy of the document that you signed at least 14 days prior to signing it?

PN81

MR GILL: Yes.

PN82

THE SENIOR DEPUTY PRESIDENT: Thank you. Can you tell me, Mr Gill, whether you were given any written advice from the employer that recognised the opportunity that you had to be represented by a union in the matter?

PN83

MR GILL: Only insofar as the draft document .....

PN84

THE SENIOR DEPUTY PRESIDENT: Sorry, perhaps you can tell me, whereabouts in the draft document suggests that? What is it in the draft document that suggested that? Do you have the document there in front of you?

PN85

MR GILL: Yes. I cannot find the clause. ..... probably 12 .....

PN86

THE SENIOR DEPUTY PRESIDENT: Yes, now, was there any advice given to you though when you were provided with that draft that recognised that had you wanted to enlist the support of someone else to be involved in the negotiation of the agreement you could do so?

PN87

MR GILL: Yes, that was verbal, not written.

PN88

THE SENIOR DEPUTY PRESIDENT: I see, thank you. Thank you, Mr Gill. Mr Cini, I have to indicate to you that I have some substantial reservations about this agreement. I accept that the very presence of Mr Gill on the telephone and the information provided to me by yourself, is such that it is clear that both parties have entered into an agreement in good faith and have come today to try to achieve certification of that agreement.

PN89

MR CINI: Yes, sir.

PN90

THE SENIOR DEPUTY PRESIDENT: Mr Gill, that is the case from your perspective?

PN91

MR GILL: Yes.

PN92

THE SENIOR DEPUTY PRESIDENT: My concerns fall into two broad categories and it appears to me that there might be some impediments to the certification of this agreement. The first of those categories relate to the requirements outlined in section 170LK. Now, what I propose to do is to outline my concern, perhaps in a little more detail than would normally be the case because, firstly, you do not have a copy of the Act and, secondly, I'm very much aware that Mr Gill is probably not an expert in this field. Mr Gill, the Act under which I am obliged to consider this agreement establishes a number of different types of agreement. This type of agreement is one that is being proposed for certification under a section that we call 170LK. It relates to an agreement reached directly between an employer and his or her employees and, as such, it does not involve a union.

PN93

For that reason, or perhaps I should rephrase that, it need not necessarily involve a union. For that reason the Act is perhaps a little bit more specific than is the case in a number of other areas and the Act requires that the employer provide at least 14 days notice in writing of the intention to make the agreement and that the agreement must not be made before those 14 days have passed. On the basis the information given to me, I can conceive that that requirement has been met. The Act request at section 170LK(3), and I quote:

PN94

At or before the time when the notice is given, the employer must make reasonable steps to ensure that every such person either has, or has ready access to the proposed agreement in writing.

PN95

And I'm satisfied on the basis of the information given to me by Mr Gill that that requirement has been met. The Act requires that that notice must also state that:

PN96

If any person whose employment will be subject to the agreement is a member of an organisation of employees and the organisation is entitled to represent the person's industrial interests in relation to work that will be the subject to the agreement, that person may request the organisation to represent the person in meeting and conferring with the employer about the agreement.

PN97

I must say that I am having substantial difficulty appreciating that that requirement of the Act, which is as I read it a mandatory requirement, has in fact been met in this case. Can you help me in that regard, Mr Cini, first of all. Then I will ask Mr Gill.

PN98

MR CINI: Sir, thank you for the opportunity. I'm not sure that we have established that any employee is a member of an organisation.

PN99

THE SENIOR DEPUTY PRESIDENT: That is not necessarily the issue. The question is: whether or not the notice that was given to the employees, at least 14 days prior to the requirement that they vote on the agreement, stipulated that opportunity. It is that issue that I am having some difficulty with in this matter.

PN100

MR CINI: If you could be a bit patient with me.

PN101

THE SENIOR DEPUTY PRESIDENT: Yes, certainly.

PN102

MR CINI: I will try and flick through the file and see if I can detect anything.

PN103

THE SENIOR DEPUTY PRESIDENT: Certainly. Perhaps while you are doing that I will ask Mr Gill. Mr Gill, first of all, do you understand the question that I'm asking of you?

PN104

MR GILL: Yes.

PN105

THE SENIOR DEPUTY PRESIDENT: Can you confirm to me that my understanding is correct in that you were not given a notice, at least 14 days prior to signing the agreement, that indicated the situation in relation to the potential for representation?

PN106

MR GILL: ..... No, I'm not sure of that.

PN107

THE SENIOR DEPUTY PRESIDENT: Thank you. What we might do now, Mr Gill, is just pause for a moment while Mr Cini looks through his file.

PN108

MR CINI: Sir, I cannot find any reference to it at all here. Unfortunately, I can't give you a definitive answer to that.

PN109

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Cini. Now, the second area of concern that I have relates to what is called the no disadvantage test. For your benefit, Mr Gill, I need to be satisfied that the agreement does not represent the potential to disadvantage employees in terms of a comparison with the award that would otherwise have applied. Now, Mr Cini referred me to clause 9 of the agreement. Clause 9(a)(1), as I read it, stipulates that ordinary hours, or ordinary times shall mean a minimum of 150 hours in a 4-week period.

PN110

What I don't see though, and I suspect it is by way of an oversight, is any form of maximum provision. If I read clause 9(a), Mr Cini, in relation to clause 9(a)(4), there exists the potential to work as I would see it a 10 hour ordinary day on an ongoing regular basis. Now, if the agreement were to be literally applied then I suggest that in that regard it would not be all that hard to see that an amalgamation of those additional 2 hours ordinary time per day together with the requirement stipulated in 9(a)(3) that a permanent employee's ordinary hours of work may include public holidays, would have the potential to mean that the rates of pay specified in the agreement may not be adequate to meet those that are specified in the award.

PN111

Now, I'm certainly not suggesting that there has been any intention here to ask the employees to agree deliberately to a document that sets about removing entitlements and I'm rather suggesting that it is more by way of an oversight. Perhaps the agreement was drafted by people who aren't expert in this field. So as I read the agreement it is only fair that I point out to you that specifically in that respect I have some substantial difficulty in seeing how the "no disadvantage test" is met.

PN112

MR CINI: Sir, if I may, I would suggest that with clause 9 it deals with a number of issues: 9(a)(1) which you quite rightly point out is a minimum of 150 hours. 9(a)(2) recognises that overtime will be paid. I appreciate the dilemma that you are raising and 9(a)(4) refers to a span of hours that is unlikely to be an ongoing arrangement. In other words I would be most surprised, and Mr Gill is better placed than me, but I would be most surprised if employees are likely to work between 5.30 am and 7.30 pm on an ongoing basis and it may be that the drafting is an issue and I would agree with that.

PN113

The situation is vineyards have a tendency to have a demand placed on them by wineries and they have to get the fruit there at an optimum time. Now, their hours are dictated by the wineries to a large extent. That means that there are occasions where they will have to start early or finish late. There are other issues that I can't elaborate on. I think frost is another issue but the situation there, sir, is that if we look at that and we look at the remuneration proposed in clause 10 that we find that there is roughly 4 or $5000 more than the award rate.

PN114

Now, if we then refer again to the highest rate in the award of $12.20, and that is not the casual rate, that is a part time and full time rate of $12.20 per hour, I would suggest that it would take an enormous number of hours to be worked to meet that but I guess in fairness to allay some of your concerns we should do the arithmetic on it.

PN115

THE SENIOR DEPUTY PRESIDENT: Well, a rough calculation would indicate to me that the agreement effectively allows employees to work those 10 hour days 5 days a week at least. Over the course of a year that would if the award rate were to be applied total something like $9500 extra per annum.

PN116

MR CINI: Sir, and if I may ask, your basis on it occurring for 52 weeks of the year or 48 weeks of the year.

PN117

THE SENIOR DEPUTY PRESIDENT: I simply looked there, Mr Cini, at what the agreement appears to allow as distinct from what might be a common practice because I have no information in that respect.

PN118

MR CINI: Sure, and on the face of the document itself there is no limit to the number of weeks this would occur but I would suggest, and Mr Gill can confirm one way or the other, I suspect those longer hours, those longer days would occur only on some occasions during the year but I appreciate what you are saying.

PN119

THE SENIOR DEPUTY PRESIDENT: Well, I would expect that you might well be right but in looking at the application of the "no disadvantage test" in the context of this particular provision I need to indicate that I have a significant concern and I need to keep stressing that I'm not in any way suggesting that there was any deliberate error in this regard. My view, Mr Cini, is that initially because of the difficulty that I have in being satisfied that the requirements of section 170LK(4) have in fact been met, that I am not prepared to certify the agreement at the present point in time.

PN120

Accordingly I'm suggesting that the parties might use the opportunity that is presented by way of a requirement that they go back again and ensure that the specific requirements of section 170LK are met to remedy some of these other potential difficulties and uncertainties associated with the agreement.

PN121

MR CINI: Yes, sir.

PN122

THE SENIOR DEPUTY PRESIDENT: I can indicate clearly to you that in the event that the parties went back and repeated the process provided for in section 170LK and you were to liaise with my office, I would be very happy to ensure a hearing date that would be scheduled for a very short period of time after the employees had indicated support for the agreement because I would be anxious not to delay the process unnecessarily but I would suggest that the parties might consider initially the provisions relating to ordinary hours of work in clause 9(a)(1).

PN123

I suggest also that it might be appropriate that the parties clarify their intention in relation to clause 6 which appears to imply that the agreement ought to be read in concert with the award but is itself somewhat inconsistent, if I can call it that. It might be appropriate for the parties to take the opportunity to clarify what is meant by clause 9(b)(4) which references a clause 9(3) which may or may not refer to 9(b)(3) and I suggest that there may be a typographical error in 9(d) so that that simply refers to trainees or trainee employees as distinct from training employees.

PN124

Mr Cini, they were the questions that I was going to raise. That latter category of question were probably issues that I could have been satisfied on by answers given by both yourself and by Mr Gill but it appears to me that particularly given the significance of the shortcoming in relation to section 170LK of the Act and the difficulty that I have in the application of the "no disadvantage test" it might be an opportune occasion to remedy those issues.

PN125

MR CINI: Yes, sir.

PN126

THE SENIOR DEPUTY PRESIDENT: Mr Gill, do you understand the suggestion that I put back to Mr Cini?

PN127

MR GILL: No, I didn't.

PN128

THE SENIOR DEPUTY PRESIDENT: In effect what I am saying is that I consider that the parties may well have overlooked some of the quite specific requirements in section 170LK of the Act. I'm sure that from both the employer and the employee point of view Mr Cini would be able to give or provide copies of that section of the Act so that both the employer and the employees could understand the requirements that I need to look at so that this sort of oversight can be corrected and I'm suggesting that if the parties do have to go back and repeat the process outlined in section 170LK, then that might be an opportune time to remedy what I suspect is an oversight in terms of the way in which clause 9(a)(1) particularly is worded at the present time.

PN129

MR GILL: Yes.

PN130

THE SENIOR DEPUTY PRESIDENT: And if Mr Cini advises my office, I will endeavour to ensure that provided the requirements of section 170LK are met, so that the employees will have had at least another 14 days notice of the intention to make the agreement, with that notice specifying the opportunity for the potential involvement of a union pursuant to section 170LK(4), then I will list the matter as soon as possible after that time. Mr Cini, is there anything else that you want to raise with me?

PN131

MR CINI: No, sir. I think we can address all that and I undertake to speak to both the employer or the workplace and pass the information on, provide them with a copy of the Act, that relevant part of the Act and get back to you as quickly as we can.

PN132

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN133

MR CINI: Thank you, sir.

PN134

THE SENIOR DEPUTY PRESIDENT: Mr Gill, is there anything further you wish to add?

PN135

MR GILL: No.

PN136

THE SENIOR DEPUTY PRESIDENT: Very well. I will adjourn the matter on this basis. Thank you.

ADJOURNED INDEFINITELY [10.50am]