C2002/4825, Transcript of Proceedings [2002] AIRCTrans 4090 (15 October 2002)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS


AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT DUNCAN

C2002/4825
C2002/4838

APPLICATIONS FOR AN ORDER TO STOP
OR PREVENT INDUSTRIAL ACTION

Application under section 127(2) of the
Act by Carlton and United Breweries Limited
for an order to stop or prevent industrial
action

Application under section 127(2) of the
Act by the Australian Liquor, Hospitality and
Miscellaneous Workers Union for an order to stop
or prevent industrial action

MELBOURNE

10.07 AM, WEDNESDAY, 2 OCTOBER 2002

C2000/4825

SECTION 127(2) APPLICATION BY CARLTON
AND UNITED BREWERIES

PN1

MR J. TUCK: I seek leave to appear on behalf of the applicant, CUB. I appear with MS BARNESBY.

PN2

MR J. MADDISON: I appear on behalf of the CFMEU, FEDFA Division. While I am on my feet, your Honour, I indicate there will be no opposition to leave today. Unless it can be done selectively I apprehend Mr Hinkley seeking leave on behalf of the ALHMWU. And also, your Honour, while I am on my feet, I foreshadow an adjournment application on behalf of the CFMEU.

PN3

MR J. NUCIFORA: I appear for the Australian Services Union. I have MR WILLIAMS appearing with me.

PN4

MR R. HINKLEY: I seek leave to appear as counsel in the matter that has been called on. Your Honour, I did understand there is another matter listed. I suppose it is yet to be called.

PN5

THE SENIOR DEPUTY PRESIDENT: That is correct.

PN6

MR HINKLEY: Thank you, sir.

PN7

THE SENIOR DEPUTY PRESIDENT: I take it there is no difficulty. As you have indicated, Mr Maddison, with the applications for leave, and accordingly I grant them. Having got that far with this matter I intend to have the NX matter called on so that we can sort out what is going to happen to them.

C2002/4838

SECTION 127(2) APPLICATION BY AUSTRALIAN LIQUOR, HOSPITALITY AND MISCELLANEOUS WORKERS UNION

PN8

THE SENIOR DEPUTY PRESIDENT: Could I have appearances?

PN9

MR R. HINKLEY: I seek leave to appear as counsel for the applicant in that matter.

PN10

MR J. TUCK: I seek leave to appear on behalf of the CUB with MS BARNESBY in that matter.

PN11

MR J. NUCIFORA: I seek leave to appear for the Australian Services Union.

PN12

THE SENIOR DEPUTY PRESIDENT: You are in effect intervening?

PN13

MR NUCIFORA: Intervening, your Honour, yes.

PN14

THE SENIOR DEPUTY PRESIDENT: Yes. Very well, Mr Nucifora, any other applications of that kind?

PN15

MR J. MADDISON: Your Honour, I, at this stage, reserve my position pursuant to section 34 to intervene in respect of that second matter called on.

PN16

THE SENIOR DEPUTY PRESIDENT: You will make an application at the appropriate time, in your view?

PN17

MR MADDISON: Yes, yes.

PN18

THE SENIOR DEPUTY PRESIDENT: All right, Mr Maddison.

PN19

MR MADDISON: Thank your, your Honour.

PN20

THE SENIOR DEPUTY PRESIDENT: And, once again, in this matter, I take it that there is no objection to the leave being sought by counsel and Mr Tuck and accordingly will grant that leave. Now, Mr Tuck?

PN21

MR TUCK: Your Honour, are you going to call on the first matter to deal with?

PN22

THE SENIOR DEPUTY PRESIDENT: Yes, sit down for a moment, Mr Tuck, I will get it clear what is going to happen. The matters are listed together. They are certainly not joined. The query in my mind is do we deal with them seriatim or do we deal with them in a confused fashion. For example, if there is evidence to be given by one witness in both matters one time on the stand.

PN23

MR HINKLEY: I would suggest, your Honour, if I may, and I regret I didn't have a chance to talk to this - to the other side about this, but they should at least be heard concurrently and that would enable a witness in one matter to be also the witness in the other. We wouldn't object to them being joined but they should be at least heard concurrently. Really, your Honour, as your Honour is probably aware, they are a mirror image of each other.

PN24

THE SENIOR DEPUTY PRESIDENT: They certainly do seem to have some common root.

PN25

MR HINKLEY: That is the drafting.

PN26

THE SENIOR DEPUTY PRESIDENT: Mr Tuck, what do you have to say about that?

PN27

MR TUCK: I think it is an appropriate course, your Honour.

PN28

THE SENIOR DEPUTY PRESIDENT: Join or concurrent?

PN29

MR TUCK: Hear them concurrently.

PN30

THE SENIOR DEPUTY PRESIDENT: Yes, all right. That is a simpler way of doing it. I will hear them concurrently. Yes, Mr Tuck.

PN31

MR TUCK: Your Honour, it is my intention this morning to indicate to your an outline of the nature of the application that CUB brings before you and that may be a useful starting point, your Honour. There is a long history in this matter and it has required the assistance of the Commission on a number of occasions. First, with Senior Deputy President Watson's assistance and Commissioner Hodder also had some involvement in the matter last Friday before the company filed this application.

PN32

Your Honour, a starting point may well best be the agreement between the parties. I refer your Honour to the enterprise agreement between the two parties. I am not sure that your Honour has a copy before you.

PN33

THE SENIOR DEPUTY PRESIDENT: I do have a copy of the agreement that was certified by Senior Deputy President Acton in December 2000.

PN34

MR TUCK: That is right, your Honour.

PN35

THE SENIOR DEPUTY PRESIDENT: Yes, I have it.

PN36

MR TUCK: Your Honour, I might just draw your attention first to clause 25 and clause 25A of that agreement. Your Honour, this application involves the application of these two clauses and you will see that on the application for grounds that the company has sought to flat its intention as early as 1 August this year of its intention to introduce continuous running of the Abbotsford plant. It doing so relies on the ability to introduce continuous running under clause 25A. I think I need to take you first to that clause, your Honour.

PN37

Clause 25A.1 is headed "Introduction." Clause 25A is headed "Continuous Running Abbotsford." Now, you will see that clause 25A.1 is drafted in past tense. It is recognised that the introduction of continuous running in packaging and distribution is designed to increase the efficiency in the operation of the brewery. We say the way in which that clause is drafted, past tense, the recognition is expressed there, that is:

PN38

It is already being recognised by the parties that the introduction is designed to increase the efficiency in operation of the brewery.

PN39

That is important, your Honour.

PN40

It goes on:

PN41

The continuous operation of packaging lines needs to be supported by the introduction of work practices in distribution that ensures an employee or employees are available at all times to remove the pallets from the palletiser.

PN42

Then it moves into the - it moves in that paragraph, your Honour, in our submission, to some detail about introduction of continuous running. It starts to get into some detail. Then it moves on further:

PN43

No full-time positions will be lost as a result of any agreed implementation of continuous running.

PN44

It goes on, your Honour, and you will see the wording "any agreed implementation" and I am sure that the unions will spend some times over those words. It goes on, your Honour, and it goes on importantly, we say, to put those words in some context. It deals in 25A.2 "Packaging":

PN45

The implementation of continuous running will -

PN46

that is will -

PN47

be discussed in each individual work area. The work area will explain to the employees the reasons for an implementation of continuous running.

PN48

Your Honour, we will call evidence to say that that has happened:

PN49

The union shall not unreasonably oppose the introduction of continuous running. However, should the union have issues unresolved through the consultation process in the work area or areas on continuous running then the settlement of disputes procedure will apply.

PN50

And then it goes, importantly, at the last sentence, your Honour:

PN51

The union reserves their rights to pursue work value matters.

PN52

We say that is an important sentence, your Honour, because that talks about having implemented continuous running the union has reserved its right to run a work value case in relation to the new practice. The work value case may make sense, your Honour, having introduced the change. Now, your Honour, we say "shall not unreasonably oppose" is the reason that we are here today because, your Honour, we say that we have sought to consult both at the work area level and at the business process level. We have reached a position in that consultation over the last two months which lead the company to the position to determine whether there are any outstanding issues upon which the union might oppose continuous running, the company needs to conduct a trial.

PN53

The company is satisfied, your Honour, that the issues raised in the work area meetings and the business process level have been addressed. And to ensure that those issues continue to be addressed and that they can be proved to have been addressed, the company needs to have a work trial of one week first in the packaging line, it is described as B1, and then the second week to introduce another line, so the two lines are running and we can determine whether or not there are any issues outstanding in relation to the introduction of continuous running.

PN54

By way of introduction, your Honour, I indicate that under this agreement this is, in essence, the key flexibility that this agreement provides for. You might say in substance this is the only flexibility that it provides for. In an agreement where there has been 15 per cent increase over the life of the three years of this agreement. The union's position, your Honour, as indicated to the company in meetings is, first, the employees have a right to veto this. They can capriciously and at a whim simply choose whether or not they want to introduce and participate in continuous running. That is the position that has been put to us.

PN55

Secondly, if you pay us more money we can introduce this flexibility. That is, you pay us again and we can make this happen. Now, we say they are the two concerns that have been raised with the company and they are not reasonable but - a reasonable basis to stand there and veto this introduction. Now, moreover, your Honour, floating around is what Mr Veenendaal put on transcript last Friday and that is the union, when it went to a meeting of its members in relation to the voting in this agreement, told them that it had the right of veto. They told them that. That was never agreed, we say, between the company and the union but because they went out and told people, they say, that they did have that right - - -

PN56

MR HINKLEY: I am reluctant, and I say that sincerely, your Honour, to interrupt, and it is only for this purpose. I apprehend my friend is opening and I see the good sense of that. I necessarily apprehend that any assertions he makes in opening are of no evidentiary value unless and until a competent person gives evidence to the Commission in a way in which satisfies the Commission. I put it on the transcript because I have seen these things happen in the past. The formal objection to the Commission relying upon assertions from the bar table in these proceedings as being evidence in the proceeding. Now - - -

PN57

MR TUCK: Your Honour, I can satisfy my friend's concerns in this.

PN58

MR HINKLEY: I will just exhaust it for a minute, your Honour. I don't object to my friend speaking in any way he wants to. I don't want to cause problems with that. But the formality of the objection is there to ensure that anything he says will necessarily be brought forward in evidentiary fashion unless, of course, it is legal interpretation or that sort of thing, your Honour.

PN59

THE SENIOR DEPUTY PRESIDENT: All right, Mr Hinkley.

PN60

MR TUCK: I didn't that understand that actually being an objection, just a comment, your Honour, but - - -

PN61

THE SENIOR DEPUTY PRESIDENT: That is right. I take it that way.

PN62

MR TUCK: Your Honour, I have provided my friend with two statements and finalised this morning by the company, one by Mr David Whytcross and one by Mr James Houston. Both those gentlemen, as representatives of the company, have had the carriage of the introduction of continuous running over the last two months and they are detailed statements in relation to those matters. The transcript that I refer to is a matter of public record and in that transcript if what I was referring to, your Honour.

PN63

The LHMU have stated that we told people they had a right to veto and somehow, because they made that representation, your Honour, that has become a major sticking point in this whole matter. Because they are embarrassed and they are now saying, "Because we have embarrassed ourselves, bad luck, you can't introduce continuous running. We are going to interpret "unreasonably oppose" as a right of veto regardless. That is, we don't have to put up any reasonable basis on which we oppose continuous running. We simply are entitled to say no and say yes only if you pay us more money and then we will put it to the members that they can do it."

PN64

Now, the other point, your Honour, we say is important is that CUB operates, as you would be aware, throughout Australia. It has breweries at Matilda Bay in Perth, Cascade Brewery in Hobart, the Kent Brewery in Sydney and the Yatala Brewery in Brisbane. Each of those sites operates continuous running. So when we say, your Honour, to the work areas and to the business process that we can introduce continuous running safely, we can introduce it with the proper safety mechanisms around it and that we can certainly run a trial, we do so because we have experienced everywhere else but here in running continuos running.

PN65

We operate continuous running everywhere else but here. Now, we can to introduce what we operate everywhere else and say we have paid for in the 2000 agreement in Victoria. The unions have taken, we would say, a capricious position to simply deny that that can take place and basically say that has been banned. We also complain, your Honour, about the way in which they go about that in turning up on site, calling stopwork meetings at a whim. They seem to have a very, very confused position and understanding of their obligations under the agreement and at law.

PN66

Now, Mr Fountain and Mr Weissmann will simply turn up at the site and say, "We are holding a stopwork meeting in the next half hour." "Can you please - you haven't given us notice of that, would you please hold it in the breaks." "I told you we are holding a stopwork meeting, that is what is going to happen." Mr Weissmann and the LHMU seem to be under the misapprehension that that is a lawful way to behave and they continually do it, time and time again. We would say that needs to be restrained that behaviour.

PN67

MR HINKLEY: Well, is there an application to restrain such behaviour?

PN68

MR TUCK: The application is before you, your Honour. We say it is - - -

PN69

THE SENIOR DEPUTY PRESIDENT: You rely on the terms of the application that is before the Commission?

PN70

MR TUCK: Yes. The evidence will be called, and has been provided to my friend, indicating that that behaviour is continuing, it is repetitive and it is tiresome, your Honour. It is tiresome that Mr Weissmann comes here and bullies the company in relation to - - -

PN71

MR HINKLEY: Commissioner, I understand my friend's delight in expressing himself in this way and I am not unaccustomed to do it myself when I think it is appropriate, but that of which he complains is not raised in the application.

PN72

THE SENIOR DEPUTY PRESIDENT: The draft order, to my mind, seems to cover the situation.

PN73

MR HINKLEY: The draft order covers anything at any time which you might consider to be industrial action of any sort, but the application documentation accompanying it doesn't alert anyone to this issue. This is the first time this issue has been raised in relation to the application. Now, I am not going to stop my friend, your Honour. I would suggest, though, that it is unhelpful to attempt at this stage to go through what he might have as a whole range of things he doesn't like in respect of which he seeks an order. The issue in these proceedings, really, your Honour, is the application of clauses in relation to continuous running in packaging and distribution, as I understand it, at Abbotsford, leaving aside Altona.

PN74

I don't know how much time my friend wants to do in relation to other matters but we do object to argument and evidence being raised in relation to matters that are not caught within the documentation filed in the Commission for the application that has been made.

PN75

MR TUCK: Your Honour, I don't intend to deal with that application - that objection now, your Honour. It is simply, we say, covered by the application. It is in the grounds and it is in the orders. Now, the detail of what happened is in the statements that have been provided and if the application would need to be amended then we would seek to amend it. But these are not matters that we only have knowledge of. My friend acts for these people and he will be able to get instructions in relation to those matters.

PN76

We have put in statements that have been provided this morning of that behaviour and the order is directed and cast in broad terms of the order we seek to cover that type of behaviour, that that is stopped. Now, your Honour - - -

PN77

THE SENIOR DEPUTY PRESIDENT: Yes.

PN78

MR TUCK: Your Honour, that, by way of introduction, sets out, I think, the core issue between the parties. Now, your Honour, the statement - the application in its grounds sets out - and your Honour will have read - a history beginning 1 August when the company first advised the LHMU of its intention to introduce continuous running. Now, your Honour, that process, just in broad outline, lead on 14 August to the company lodging a section 99 notification which was heard before Senior Deputy President Watson on 22 August.

PN79

Your Honour, annexure 2 to the application was the recommendation you have seen of Deputy President Watson made 22 August 2002. The company says it was unable to follow those recommendations by reason of conduct of the unions seeking to frustrate that process. A further report back was held before Senior Deputy President on 29 August and his Honour made a statement, that is in annexure 3. And it is important, your Honour, because I take you to annexure 3 of that application, your Honour.

PN80

You will see that in his statement Senior Deputy President Watson makes - sets out the recommendations he made in relation to 22 August that the parties meet as soon as possible at the business process level. Now, at CUB, your Honour, you will understand that there is a business process level meeting and there is a work area level meeting, so there is two levels, and that is provided for expressly in the agreement. So that concept of business process of work areas is provided for in the agreement.

PN81

THE SENIOR DEPUTY PRESIDENT: And matters may move from the work area to the business process?

PN82

MR TUCK: The business process operates at a broader level, yes. He sets out, your Honour, the recommendations he made and he goes on and he talks about the way in which the parties have been progressing or not progressing in paragraph 5 and he states:

PN83

It appears to me that the lack of progress between the parties arises in part because the parties discuss continuous running in an abstract or theoretical way rather than a specific proposal capable of considered discussion and modification.

PN84

And he goes on in paragraph 6 to make comment about:

PN85

The capacity of the parties to devise a model of continuous running capable of creating a practical manifestation of each of the potential problems raised by the unions and jointly develop a model for continuos running which avoids most or all of the potential problems or end or mitigates their effect to the satisfaction of CUB, the unions and their members.

PN86

And he then goes on in paragraph 7 on the second line:

PN87

It seems to me, and I suggested to the parties in conference, that the next step ought to be the CUB to develop a specific proposal as a basis for a practical negotiation between the parties.

PN88

From that position, your Honour, CUB has held meetings at the work area level. It has held a meeting, now two meetings at the business process level where it has developed a practical model which it now seeks to implement by way of trial. Our concern, your Honour, in part has been that the unions cannot get over the issue of money and veto and so we now reach the pointy end of this process, your Honour, where we have a proposal, we have a practical manifestation of our - in the form of a trial. We have rosters drawn up. We have a process to be trailed with the safety mechanisms calling on the experience in each of our other breweries.

PN89

We have people rostered on to monitor the trial. And we can't get it to happen because there is a ban on it. And the only reason we can see for a ban seems to be money and we can veto this if we want to. Now, your Honour, you will hear evidence of the difficulty the company has had, and we would say that you should draw the inference that the behaviour of the union along the way has been one of simply delay and frustration: rescheduling meetings, not turning up to meetings, advising employees not to attend meetings and then calling stopwork meetings last Sunday evening and then placing a ban on the implementation of a trial.

PN90

This is a trial, your Honour. This is not the final implementation. This is a trial to determine whether there are any issues, whether they be minor or major, that must be addressed before continuous running is properly implemented. It is a trial to ensure that when it is implemented there are now dangers in its implementation, that the concerns raised by employees are addressed. It is a trial for two weeks.

PN91

THE SENIOR DEPUTY PRESIDENT: Is it a trial across the whole of the operation or a trial for particular work areas?

PN92

MR TUCK: Particular work areas starting with one work area and then introducing another work area in the second week. It starts with one work area, your Honour, one. Your Honour, we say we don't need the agreement of the union to implement continuous running. We simply are required to meet any reasonable opposition that they raise. And that is the way that we say the agreement operates. As far as there have been legitimate concerns raised by employees from the work area and in the statement of Mr Whytcross, he will give evidence about a meeting on 24 September where he dealt with a number of issues such as, would there be payment for continuous running, would employees main break be taken within five hours of commencing the shift, where would it be implemented, is it agreed to, would there be any payment for dual machine operations, what would happen if employees refused to undertake the relevant training, those sorts of issues were raised and addressed.

PN93

So there has been that level of consultation at the work area level and there has been consultation, although not very fruitful, at the business process level with the unions. Now, what we want to do, your Honour, and what we say we are entitled to do, is introduce a trial. We say that is not a big step in relation to what we say we are entitled to do under this agreement. We want to be fair and reasonable. We want to make sure that any issues that are raised by the unions on behalf of their members are properly addressed and that they are comfortable with the introduction of this process.

PN94

We say it is provided for in the agreement but we are prepared to, as a first step, introduce a trial to see what other issues might be flushed out or whatever - or what concerns can be allayed, equally, in the minds of the employees by this introduction.

[10.37am]

PN95

We are confident, your Honour, that the introduction of a trial will allay whatever concerns employees may have. Because our experience in every other brewery in Australia leads us to the belief, and have the confidence, your Honour, the company has the confidence that once it introduces a trial the concerns that the employees may have will dissipate and go away. Now, it is easy, your Honour, for the unions - it is a much easier position for the unions, your Honour, to say no to a trial because then they can simply flag in a general and nebulous sense concerns that they have, and they say these are major concerns, you have to address these.

PN96

And they can put to a side in trying to camouflage and keep under the table the issue about money, veto, and say, well, let us deal with the issues about the implementation. But it is much easier, your Honour, for them to say though anticipating means when they haven't had a trial because they have a trial we are confident, your Honour, that those issues will be addressed. So we come back, your Honour, to the position that the position of the unions is simply one of money, and veto, and that is not a position supported by the agreement. That is unlawful. That is a ban. And that is the basis upon which we seek the order.

PN97

Now, your Honour, we would prefer not to have to seek the order. We would prefer, if possible, to first see whether your Honour could facilitate a trial by consultation between the parties in conciliation. But unless we can get to a trial, your Honour, we are left with no choice but to press on and seek orders against the union in relation to this limitation and ban. And it is a first point, we would hope that your Honour may be able to facilitate as trial over the next fortnight to allay the concerns, that is the opposition, which must be reasonable, by the union in permitting this trial. Now, that, your Honour, is an outline of where we are at.

PN98

THE SENIOR DEPUTY PRESIDENT: Very well.

PN99

MR TUCK: Your Honour, I am happy - there are two witnesses which we propose to call in support of our applications. But first, your Honour, it may well be worth, we would urge your Honour to determine in your own mind and having heard from the other side whether or not some discussions may lead to facilitation of a trial over a fortnight period without the need for hearing of final orders.

PN100

THE SENIOR DEPUTY PRESIDENT: I intend to proceed in that fashion. I intend to hear from the other side.

PN101

MR TUCK: Thank you, your Honour.

PN102

THE SENIOR DEPUTY PRESIDENT: And at the conclusion of that decide whether or not it should be investigated along the lines you have suggested.

PN103

MR TUCK: Thank you, your Honour.

PN104

MR HINKLEY: Could your Honour excuse me?

PN105

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Hinkley.

PN106

MR HINKLEY: Commissioner, I do understand my friend has at least two witnesses. He provided us, as you realise, with those witness statements. During the running I haven't looked at them but I have had them looked at in a cursory fashion by those instructing me, and as I would expect they require us to be able to receive instructions with a view to cross-examination, for example, and instructions with a view to our evidence. The Commission will appreciate that as we made our application, filed it rather yesterday, we are embarrassed in the sense that we just haven't had time to commit any evidentiary material to any witness statement at all.

PN107

Now, that is something that we would obviously have to have some time to do. I understand my learned friend wants to go with witnesses today. I do not have a problem with that, Commissioner, subject obviously to my not being called upon to cross-examine them, because I haven't had access to what they are saying or received instructions. And I really do not cross-examine from little notes passed across the table. I prepare a cross-examination.

PN108

Your Honour, I understand that from what my friend has said, and I do want to say something about the matters he raised, I understand that what the company pursues presently at the moment is some means by which a trial could be conducted. I understand that the company apprehends that a trial would be, in their words but not mine, Commissioner, vetoed, a trial would not be able to be conducted with the agreement of the men and women, and this is my interpretation of what he says, unless there was some money in it. I note that he talks about that as a long term position of the union.

PN109

Can I say in relation to any proposed trial that there is room for discussion about the prospect of that occurring. Those at the Bar table that instruct me from the union, and we have the senior delegate from the site here with us, Mr Dominic Fountain, instruct me that at the end of the day it is going to be something that the men and women involved will decide about what can be done. But those who are here with me instructing me tell me that in relation to this trial, which is what really is being talked about now, money may not be the determining issue. I do not want to mislead you, your Honour. I am not saying that those who instruct me say that the men and women do not see money as a necessary component. But those who instruct me with their experience say that in their view that may not be the sticking point.

PN110

I am not suggesting that there are not some sticking points. And also, if your Honour pleases, I do not have any fulsome instructions about what combination of arrangement might facilitate a trial, I do not want to mislead the Commission, I have been told some things but I am not going to say any of those here and now. I would not want to be placed in the position of having to announce our negotiating hand before we sit down to negotiate. Now, in that context, your Honour, from the instructions I am given, my client is more than content to enter into discussions with the assistance of the Commission, immediately or at the time your Honour decides, with a view to a trial and in the view of those instructing me a trial which may not be dependent upon money, but would be dependent upon other things which, as I say, I wouldn't go into.

PN111

Now, I know the company will take the view that they have been trying to get this going for several months. We observe, of course, that the agreement is almost expired, the three year agreement, about six months to go, I think. So it is a little bit late in the day to start agitating the way that they have. We also observe that the company's original position in its letter of 1 August, and I do not know whether it is accessible on the file, but happily I have people who can dig these things up for me. The company, in its letter of 1 August this year, parenterally stated that continuous running will take effect from 1 September.

PN112

Your Honour, I understanding it is in the material already before the Commission, but perhaps I could just hand this copy up and leave it with the Commission so that I am not asking you to understand its contents without having access to it. Lucky I have got people telling me what to do, your Honour, I get into a mess. It is, in fact, attachment B to our 127 application.

PN113

THE SENIOR DEPUTY PRESIDENT: Yes, I can verify that for you, Mr Hinkley.

PN114

MR HINKLEY: Thank you, your Honour. Can I beg back the piece of paper we sent up to you, your Honour, because I know they are going to punish me when they get half a chance. So, your Honour, here 1 August the company's position is - well, dictating an intention to operate continuous running and packaging distribution. The position is different at the moment. The position at the moment is that the company seeks to run a trial. I generally observe that there has been a lot of time since the agreement came into operation, and then if this continuous operation thing is such a necessary and valuable thing, well, why did they sit on their proverbials for two and a half years.

PN115

I mean it does not have an element of urgency to it, which is not to shy away from dealing with the matter. But let us not get too dramatic about this. They have been negotiating for a long time and they got nowhere. Well, they did nothing for a long time also. So I do want to make it clear that my clients, as they instruct me here, are more than happy to meet with the assistance of the Commission, immediately or in not with the assistance, as you decide, sir, to look at the issue of the trial. Those instructing me say that on their understanding money may not be the issue in that respect.

PN116

There will be issues, and I do not repeat what I said that I won't say what they are. Now, your Honour, I want to say a few things about what my friend has said, and then suggest perhaps a course of action that might be sensible to follow. And I do not do this by way of a false opening of our case, but to put the Commission into a picture. Now, can I say the first part of the picture is what the agreement says, and I am going to leave that alone for a little while and come back to it.

PN117

My friend said that the only issue was the power of veto and money. It is not. On transcript on more than one occasion Mr Veenendaal, who is here with me, told the Commission in various hearing that there were occupational health and safety issues. Now, that of course has relevance in relation to the meaning of industrial action so far as section 127 is concerned. There is an issue as to the interpretation of the agreement, and I do not say that is an easy one, your Honour.

PN118

It, of course - the interpretation of that agreement necessarily has relevance to the meaning of industrial action in section 4 of the Act also. Because if the employees and/or the union are entitled under that agreement to decline working continuous running on packaging and distribution, then there would be an absence of jurisdiction in the Commission on account of their declining not being industrial action, because it was done in accordance with the relevant agreement.

PN119

THE SENIOR DEPUTY PRESIDENT: Arguably it was done with the consent of the employer.

PN120

MR HINKLEY: I see the point, yes. I see that point.

PN121

THE SENIOR DEPUTY PRESIDENT: That is if your interpretation is accepted.

PN122

MR HINKLEY: Yes. Well, yes, the consent of the employer, I suppose, would be premised upon - - -

PN123

THE SENIOR DEPUTY PRESIDENT: The agreement.

PN124

MR HINKLEY: Exactly, your Honour, yes. Now, in relation to that, the meaning of the agreement, we have filed an application in the Federal Court under section 413A for interpretation of an agreement. And we have with us only one copy of that, your Honour, and we will copy that at an appropriate time and pass it on to you. I think my friends are more than conscious of it. That interpretation application is listed for directions on 4 December, and I know that is a long time.

PN125

Can I say that apart from filing it, which was done by a firm of solicitors which temporarily yesterday came to my aid in the panic of trying to find out what this was all about, as I understand it, didn't do anything in the way of seeking an urgent hearing in the Court. That is something to which we will turn our minds today and pursue. But that may not mean anything, your Honour, because the Court may take the view that it is all very well, but, yes - on the other hand, you know, the persuasive counsel I hope somebody else has briefed, that might be overcome.

PN126

It has come to my attention today, your Honour, that there is documentation which at least prima facie in the present circumstances indicates that the jurisdiction of the Federal Court might also be able to be raised in relation to the Trades Practices Act section 45 in respect of what might be described as deceptive and misleading conduct. Putting that in a capsule the information to which today was provided to me raises a prima facie case, that the company in dealing with its employees as to the meaning of the proposed agreement did not, itself, take a course of action to advise them of the meaning of the proposed agreement.

PN127

And I have in mind here section 170LK of the Workplace Relations Act - well, I haven't got through the agreement very well, have I? I have got its history mixed up. It is section 170LR - anyway, your Honour, it doesn't matter. I think the agreement is entitled as a division 2 agreement, I am not immediately confident that I am right. It is probably a safe course of action to take.

PN128

THE SENIOR DEPUTY PRESIDENT: It is an LJ, so it is division - - -

PN129

MR HINKLEY: Yes, well, that takes us to LJ - your Honour, the Commission, helpfully takes us to LJ, and under that, and under subsection 3:

PN130

The employer must take reasonable steps to ensure paragraph (b) before approval is given the terms of the agreement are explained to all the persons.

PN131

In relation to that, as I am instructed, I am talking about the Trade Practices action that we possibly will be taking, as I am instructed. The company did not, itself, conduct either by notice, distribution of documentation, or meeting, any process by which it expressly explained to the men. What it did was to have lots of negotiations with the union, as we all expect, and knew that the union would report to the men, and it, in effect, through that process attempt to give effect. And so they did attempt to give - to the provision which hopefully at the end of the day your Honour took us - and by that process, on at least one occasion, the company checked and agreed with the content of a publication the unions put out, which incorporated and express statement that the terms and conditions of employment in relation to local work areas included a consultative process, very important words, as I will show your Honour, on how they will work and operate by agreement.

PN132

Now, I will just hand your Honour a copy of the document which I have referred. Perhaps it might be convenient to mark it, your Honour.

MFI EXHIBIT #H1(I) EDA 2000 HIGHLIGHTS ISSUED IN SEPTEMBER 2000

PN133

MR HINKLEY: If your Honour pleases. On the left hand column on the front page of that we are told that after three months of intense negotiation the site committee is satisfied, negotiations have gone as far as they can. This sets out what has been negotiated. It should be read in conjunction with a new EDA 2000 document, which I understand is the document in its final form. And then under the wage rises, there is percentages and dates, and the last grammatical paragraph under wage rises is:

PN134

Consultative process that allows local work areas to decide on how they will work and operate by agreement.

PN135

In caps. Now, that of course is a matter that one would have to consider in terms of the Trade Practices Act, and it is actively under consideration, but the document came to my attention this morning only.

PN136

THE SENIOR DEPUTY PRESIDENT: I don't intend to enter into with you about the possibilities of mounting a plausible action under section 45, but this is a document issued by the union.

PN137

MR HINKLEY: Yes, your Honour. I do not mention the Trade Practices Act or the interpretation application other than to have the Commission informed. I do not work on the basis that we should hold back from the Commission what we have done and what we are contemplating doing.

PN138

THE SENIOR DEPUTY PRESIDENT: Yes, I understand that.

PN139

MR HINKLEY: You are quite right, sir. It is a document put out by the three unions, plural. But on my own instructions this document was vetted by company representatives before it was published to the relevant employees. Now, they are my instructions. It is a matter of evidence, of course. But they are my instructions. Now, I hear an element of jocularity at the other end of the Bar table, your Honour. In our submission, the process by which the company engaged in in informing the men and women was such that they, at least by silence, enabled a view to be communicated to the employees which was finally checked and vetted by them before it went out, saying that this clause had this affect by agreement.

PN140

Now, for the purposes of the proceedings, your Honour, leaving aside any legalities, that is a matter that goes to your discretion in relation to the 127 application. Equally going to your discretion, and perhaps also relevant to the Trade Practices Act, is the circumstances that under my instructions prior to the men voting on the document, on the agreement, that is, the company had on several occasions made it clear to the union representatives that the relevant clauses in the agreement would operate only by agreement. And that was independently communicated on a number of occasions by the unions' representatives by the men. The company knowing, or reckless at least not to consider whether or not what they said was being communicated to persons who were meant to be influenced by it to make the agreement.

PN141

That also goes to your discretion. Now, these are matters, of course, for evidence. But it is important, I think, that the Commission have a sense of how this all developed. And, indeed, at the right time I will submit that as a matter of law it is relevant to interpretation of the document. But that is a matter for final submissions, if ever we get to them. The expression used by my friend in relation to the men, women and the union LHMUs position concerning the agreement is to speak of it as an assertion of a veto, an assertion of a veto on a whim, we reject that approach to it entirely.

PN142

One could characterise the rights that arise under the agreement, perhaps as a veto. Because if your consent is required and you do not give it, then that which is sought is not achievable. But one cannot characterise it as a whim. These people, as I am instructed, on the packaging and distribution lines have for some 70 years, perhaps 90, operating under a system whereby they were entitled - and I use that word advisedly - to take their breaks, which has to be described to your Honour at some stage, at the same time as each other.

PN143

So much so that we would say that as a matter of contract law that well established practice had been incorporated into the contract of employment, and that also becomes relevant to the interpretation of the agreement which I will want to take the Commission, subject to the way you want to run the case. There has been no mention - as I have said, there has been no mention by the company of health and safety issues, although there has been by the union, and that also goes to your discretion.

PN144

Now, we have heard some talk by the company about continuous running applying in other states. It rather begs of the question by what legal process. One would want to know firstly what the relevant awards and agreements provided, and if there are discretions or vetoes in there, whether or not they were activated or resolved in some way. One would need to know the history out of which arose the circumstances in which those lines run continuously. Absent that, such an observation has almost no evidentiary weight at all. Because as we all know, one plant, one circumstance differs from the other.

PN145

We have observed, as I did by way of objection, if the Commission pleases, that my friend is intending that the proposed order would apply to circumstances of which he complains as being stop work meetings. And he speaks of amending the application. Well, one would want to know what that amendment was. We have reviewed it here at the Bar table, and the grounds, which is the form of the document there filed, the grounds upon which they rely for the order they seek do not at any time refer to the alleged stopwork meeting issue.

PN146

Now, my friend in his submissions perhaps introduced a colorful element in suggesting that the union, in respect of Senior Deputy President Watson's recommendations, had told the men not to turn up to meetings that were proposed pursuant to those recommendations. That is emphatically denied. It is simply not true. There was one occasion - there was one occasion upon which the union did say, in effect, that a meeting would not occur. But the reason for that was that that meeting would not be able to occur in conformity with Senior Deputy President Watson's recommendation for the reason that, notwithstanding his recommendation that senior delegates should be in attendance at these meetings, our senior delegate was not available to attend at that meeting.

PN147

So, your Honour, he was not able to attend because he had been suspended by the company, not in relation to the matter that is before you, and whether by misadventure or otherwise had been excluded from entering the plant for the purposes of attending that meeting on that day. Just the sort of thing that leads to unions saying, well, he is supposed to be there, okay, we know he is suspended, the reason is not relevant to this matter, but you will not let him come into these discussions. Now, whatever you want to make of that at the end of the day, that is the only example of the union telling or encouraging or advising the employees not to attend a meeting.

PN148

Now, as I say, these are matters for evidence but I like to clear a little bit of the chaff from the hay as we go along. Your Honour, we are entirely in your hands, of course. You can see what we say about the prospects of talking. We are open to do that. I do not know that the company is prepared to accommodate that, but that is a matter for them and yourself to decide. I understand my friend has got some witness evidence. We are not in the position to cross-examine on it. Your Honour, I do not want to be presumptuous or unctuous about any of this, but I think it might be helpful, a matter for you, sir, for the Commission to understand what the views of the two ends of the Bar table are without the interpretation of the agreement.

PN149

My friend took you to part of clause 25(a) and part only of it. There are a number of clauses that are relevant to interpretation - well, that I would say are relevant to interpretation. There are a number of clauses in the award that are relevant to interpretation. There are a number of provisions in the Act that are relevant to interpretation. This is a case where 127 orders are sought, we say, as a matter of law on the interpretation of the document, that is the agreement. The employees are not engaged in industrial action, and I pick up the observation your Honour made about consent as well, are not engaged in industrial action because of the document, are not engaged in industrial action. Health and safety, that is a matter of evidence, and I would not ask you to examine that immediately, and of course, the observations that your Honour made.

[11.09am]

PN150

It just seems to me and it is a matter for you Honour but it might be helpful if you knew from both ends - and we are prepared to start doing it - what that jurisdictional issue is and how, by reference to the Act, and the agreement on interpretation it is raised. Now, your Honour may - - -

PN151

THE SENIOR DEPUTY PRESIDENT: Look, I am prepared to hear you if you can confine it to nothing more than the merest outline which Mr Tuck gave of the method whereby they arrive at their conclusion that they are, as a company, entitled to implement continuous running.

PN152

MR HINKLEY: Yes.

PN153

THE SENIOR DEPUTY PRESIDENT: Without any further agreement but only having to pay attention to the detailed requirements of clause 25(a).

PN154

MR HINKLEY: Yes, that is all I had in mind, Commissioner.

PN155

THE SENIOR DEPUTY PRESIDENT: If you had that in mind it would be useful to hear you.

PN156

MR HINKLEY: Yes. I am not urging it upon you I am - - -

PN157

THE SENIOR DEPUTY PRESIDENT: No, well if it can be done - - -

PN158

MR HINKLEY: I am grateful your Honour considers it useful because I must say I think it is. Now, it is not a short point and it is not the final fulsome legal submission but I do think it gives us a smell of what it is we are talking about. That takes us, your Honour, to the Act. It takes us to the agreement and it takes us also to the award which I hope is before the Commission.

PN159

THE SENIOR DEPUTY PRESIDENT: No, it is not.

PN160

MR HINKLEY: We are just looking for that, your Honour, but I can proceed without it presently. We don't have a spare copy of the award with us, your Honour. I don't know whether my friends are able to overcome our embarrassment in that respect.

PN161

THE SENIOR DEPUTY PRESIDENT: We will move on without it for the present.

PN162

MR HINKLEY: Yes. There are a couple of - well, there is - first of all, your Honour, the Commission will be conscious of the relationship between awards and agreements such that an agreement where there is any dissimilarity between it and the award the agreement is to apply to the extent of the difference. One finds in the agreement itself - sorry, one finds in the agreement itself not unexpectedly in clause 5.2 - that is on page four - a provision to the same effect and those last three lines at the top of page four paragraph 5.2:

PN163

Provided that where there is any inconsistency between the agreement and the awards this agreement shall take precedence to the extent of any inconsistency.

PN164

And the Act, of course, is to similar effect. Can I just draw your attention for the sake of convenience, your Honour, still on the interpretation point to clause 5.3 of the agreement which provides that it incorporates all over award conditions of employment. These conditions include but are not limited to the matters set out in appendix A and listed below. Now, we will want to be producing evidence to the Commission that there is an over award condition of employment and that is one which entitles employees to take breaks on the two lines at the same time.

PN165

And as I say it has a life, as I am instructed, of 70 perhaps 90 years and if that was so was well and truly entrenched and notoriously known to be a condition of employment. And your Honour will observe that the second sentence of 5.3 is that the conditions are not limited to the matters listed in appendix A. And I will not go to appendix A at this stage at all. It is helpful to go to the award, your Honour, to get the context in which rest breaks are taken and what the regulatory scheme, subject to inconsistency has been, and that is at page 27 of the award which is the Liquor and Accommodation Industry Breweries Award 2000 print L0011.

PN166

Your Honour will see there in part 6 at page 27, clause 22.1 there is ordinary hours provisions for day workers and then at 22.2 ordinary hours provisions for shift workers. Can I just go then to 22.3 - rest periods ordinary time:

PN167

Employees shall be allowed two 10 minute rest periods in each day as follows ...(reads)... ceasing work for the day such intervals shall count as part of timed work.

PN168

Of course the issue that is raised in these proceedings - the real problem is the company's intention about how one - at what time one will take rest breaks - at what time they will take rest breaks. Can I take your Honour back then to clause 22.2.2 at the top of page 28 which is part of ordinary hours for shift workers:

PN169

Shift workers are entitled to a 20 minute meal break on each shift which shall be counted as time worked. Nothing in this clause shall prevent the parties by agreement from joining the meal and rest break periods so that employees have two breaks each of 20 minutes duration.

PN170

So the general scheme is rest break 10 minutes, meal break 20 minutes, rest break 10 minutes but there is in the award a capacity for shift workers to agree to incorporating both rest periods into one period of 20 minutes but separately from the 20 minutes for the meal break. Now, that takes us to the agreement. That agreement is print C6923. It was certified by Senior Deputy President Acton on 20 December 2000. There are a number of clauses that are referred to in the provisions that are the substantial issue in the proceedings and I will just draw them to your Honour's attention.

PN171

Clause 8 is found at page five of the agreement. It speaks of a structure of consultative mechanism distinguishing between clause 8.1 local work area, 8.2 business process and 8.3 EBA Review Committee. Clause 9 then goes on to speak of the dispute settling procedure which is in appendix C - and I will come to it. In clause 8 in the structure of consultative mechanisms under 8.1.2 the production employees, as it were, are dealt with and as I understand it B1, B2 and C1 refer to lines. I know the Commission has no evidence, unless it is in the witness statements about how the process works, but that is what the award provides - the agreement identified.

PN172

And in distribution the Altona warehouses and the Abbotsford distribution. In 8.1.7 which is the local - still in the local work area - it stated that:

PN173

It is the intention of the parties to discuss and resolve work area issues at this level.

PN174

And 8.2 contemplates them arising at cross work areas within a business process. And I think that is the case because both production and distribution in 8.1 are in issue here:

PN175

A consultative mechanism -

PN176

8.2.1 provides:

PN177

- will be set up which will involve relevant management and union officials, delegates and other employee elected officials from the business process. The intent is to resolve business issues at this level.

PN178

Then there is the 8.3 review committee and at the bottom there on page six 8.5:

PN179

Consistent with the consultative processes outlined above and the dispute settlement procedure the aim will be to resolve issues at the area work level through consultation.

PN180

As I indicated there is a provision in clause 9 for the dispute settlement procedure and that is found in appendix C which is at page 36 of the agreement. The Commission, I suspect, will be not unfamiliar with what it provides but I do draw it to your attention. Employee union to company - the process of trying to resolve the matter initially is in (i) (ii) and (iii) and in (iv):

PN181

If the matter is not settled the employer may refer it to a more senior level of management. The employee ...(reads)... or individually refer the matter to an agreed independent mediator.

PN182

Paragraph (v)

PN183

If the matter is still not settled then the parties may jointly or individually refer the matter to the Commission for conciliation and if agreed by the parties to the dispute arbitration.

PN184

Duration of the process in (iv). (vii) does not prevent the top people from resolving the problem:

PN185

(viii) The parties accept the benefit of this process and state that they will use their best offices to ensure that this process will be implemented without breach during the life of the agreement.

PN186

(ix) Whilst the parties are attempting to resolve the matter the status quo will prevail.

PN187

Now, going back to the bod of the agreement I ask your Honour to go to page 14 where there is a clause 25 entitled "Facilitative Provisions". I just remind your Honour generally without going to authority that - this is clause 25, I am sorry, entitled "Facilitative Clauses" - and your Honour will notice the plural. I remind your Honour generally without going to authority that facilitative clauses are meant to enable a general regulation of conditions to be subject to agreement at the workplace for change to that but subject to agreement throughout the following facilitative clauses say to your Honour that that, in our submission, includes 25(a) and 25(b).

PN188

Reference is made to the consultation process - that is the one I took you to sir:

PN189

It is the clear intention of the parties that the consultation process is clause 8 of this agreement and the parties have reaffirmed their intention that the implementation of workplace change is managed through a process of consultation and agreement.

PN190

Now, that is a very telling sentence in our submission, your Honour, because it makes it clear that the managing of workplace change is implemented in part by agreement. That stands out as a banner headline as to the interpretation of all of clause 25, 25(a) and 25(b) because obviously the facilitative clauses do have to be read as a whole. You can't chop and change sentences to suit your purposes at the time. And what it means, that first sentence, is that the implementation of change is to be managed through consultation and agreement. Now, in case we are wondering what consultation means clause 8 is referred and it outlines the consultative process and general principles that will apply in each of the local work areas. We are still talking about consultation:

PN191

It is recognised by the parties that effective consultation involves all relevant employees being informed and given the opportunity to participate in the decision making process on issues that concern their work area.

PN192

That is still about the process of consultation:

PN193

However, the process also ensures that if the spirit of reaching an agreement fails then the parties can utilise the dispute settling procedure in clause 9 of this agreement.

PN194

Now, none of those sentences that follow the first sentence of the second grammatical paragraph that refers to managing implementation through the process of consultation and agreement in any way diminishes the integrity of the word "agreement". All that happens after that first sentence is an exploration appropriate and helpful about the process of consultation. But what about agreement? Nothing further said. We all know what agreement means. Now, it is in the context of clause 25 that clauses 25A and 25B have their life because clause 25 say it is talking about the facilitative clauses that follow. And it says that in relation to them the implementation of workplace change is to be managed through a process of agreement.

PN195

Now, when one gets to 25A - and I suggest the way in which it is broken up first of all, your Honour - 25A.1 provides for an introduction - it says so. 25A.2 is entitled "Packaging" which is one area of work on which there are, as understand it, a number of lines. 25A.3 has one word in it "Distribution". I don't know the explanation for nothing else following it. 25A.2 is confined to packaging. 25A.4 does move on to distribution. 25A.5 identifies the detail - the proposed work practices in distribution and it provides for part time employees in paragraph (1), rest breaks paragraph (2), mid-shift paragraph (3).

PN196

Now, I want to go to each of those if I may in summary as it were to indicate the interpretation for which we contend that goes to jurisdiction. And this is not the fulsome submissions that we will be making at the end of the day but just take advantage of the opportunity to examine a bit of it with your Honour:

PN197

It is recognised -

PN198

it says under 25A.1 at page 15 -

PN199

that the introduction of continuous running in packaging and distribution is designed to increase the efficiency in the operation of the brewery.

PN200

That, of course, is part of the introduction. It tells us what continuous running is designed to do. It does not say that the parties agree to the introduction of continuous running. For it to do so would be in conflict with further provisions but in any event on its simple meaning it does not say that. It shows a recognition but introducing it is designed to increase efficiency. It is then observed as part of the introduction again, your Honour, that the continuous operation of packaging lines needs to be supported by the introduction of work practices in distribution that ensures an employee are available at all times to remove the pallets from the palletiser. And that introduction is borne out perhaps a bit later by 25A.5.

PN201

And then it says of continuous running:

PN202

No full-time positions will be lost as a result of any agreed implementation of continuous running.

PN203

Continuous running there we take it means in packaging and distribution. Now, it is a very significant paragraph that third grammatical paragraph of 25A.1 for this reason. That in an introduction it is clear that the parties contemplate that the implementation of continuous running will operate by agreement. I don't necessarily mean the detail of how the machines work, but the concept underlying it, which is that you don't take your meal breaks together, that someone has to be there to continuously run the machine. And it observes of it that it is by agreement and it protects everywhere the maintenance of full-time positions. No, it does that a little bit further as well.

PN204

Then it goes to packaging. We move from introduction, which is the general environment in which we are operating into packaging. The implementation of continuous running will be discussed in each individual work area. The work area will explain to the employees the reasons for the implementation of continuous running:

PN205

The union shall not unreasonably oppose the introduction of continuous running. However, should the union have issues unresolved through the consultation process in the work areas on continuous running, then the settlement of dispute procedure will apply. The unions reserve their right to pursue work value matters.

PN206

Now, what we have so far is the right of agreement for the implementation of workplace change. That is in clause 25. We have in 25A.1 in the final paragraph the provision for the agreed implementation of continuous running. We now have in packaging an obligation on the parties to discuss the implementation in individual work areas. We then have in relation to the union an enjoinment that it will not unreasonably oppose the introduction of continuous running, but that if there are issues unresolved through consultation, then it can go to the disputes procedure and there is a reservation of a right to pursue work value matters.

PN207

Now, in our submission the identification of a right in the union to oppose the introduction of continuous running, leaving aside unreasonably oppose, the identification of a right for it to oppose the introduction is necessarily consistent with clause 25A, second paragraph - sorry, clause 25, second paragraph, where it talks about consultation and agreement. That agreement, we say, is one in which the employees have a right, but the packaging provision also identifies clearly that the union has a right but there is an enjoinment that it shouldn't unreasonably oppose. But that doesn't lead to the conclusion that even if it did unreasonably oppose, the flagship right to rely upon agreement in clause 25 is somehow diminished, at least in the .....

PN208

And in that clause 25A.2 in the last sentence of the last paragraph, the right to pursue work value matters, obviously indicates an intention that regardless of its power to oppose the introduction, the union is not constrained from seeking to, well, get some money. Absent that, then one might argue that the union was really unable to try to get some money for the task.

PN209

Now, to suggest that what happens in these things is that you have to agree to the introduction of continuous running and then you are allowed to seek work value matters, in our submission is fatuous. The implementation of continuous running in packaging in 25A(2) speaks of events prior to the introduction, not post the introduction. First of all, you have got to discuss it at each individual work area, that is prior to introduction. You have got to give reasons to the employees, that is prior to introduction. The union shall not un..... oppose the introduction, obviously prior to introduction. By some magic, my friend suggests that the last sentence is a post introduction provision.

PN210

Now, then when one gets to distribution, the situation becomes somewhat more tortious. It provides in point 4, 25A.4:

PN211

If continuous running is introduced in specific packaging areas, this will require the introduction of different work practices in distribution to support continuous running in packaging.

PN212

Now, at first blush, the other side would say, as I understand it, well, what that means is that if we peremptorily introduce continuous running, then you have agreed that there will be the introduction of different work practices in distribution to support continuous running. Now, I say to the Commission, and I will show it in a minute, that that just doesn't work like that and that it doesn't do so is made clear, for example, by the very next sentence:

PN213

This may include the use of part-time employees and a mid-shift and staggered breaks as set out below. These changes will occur through the consultation process and, if required, the settlement of disputes procedure.

PN214

At point 5:

PN215

Details of the proposed work practices to support continuous running that may be required at distribution Abbotsford are part-time employees subject to the consultation process with the relevant unions, new employees in distribution may be engaged on a part-time basis. If part-time employees are required, they will be directly employed by CUB in classifications to provide for continuous running. Part-time employees will receive on a pro rata basis the appropriate rate of pay for the classification they are engaged in.

PN216

The provision then in the next one:

PN217

Part-time employees must be paid for ordinary hours.

PN218

The last sentence at the top of the first paragraph on page 16:

PN219

Starting and finishing times. Any agreed variation to the hours of work arrangements as outlined in this subclause will be recorded in writing and must be consistent with award change or roster notice requirements.

PN220

That appears to be confined to part-timers and, of course, the provisions of the award would apply in relation to full-timers. Your Honour will see the in the last sentence under paragraph 2:

PN221

Part-time employees will not replace any full-time employees and will be used to facilitate continuous running. They will be given set rosters. They may be rostered for a minimum of four consecutive hours on each shift by agreement with the unions.

PN222

Then there is a reference to rest breaks, and can I just remind the Commission of what is said at page 15 in paragraph 25A.4 in the second sentence where it says:

PN223

Different work practices may include the use of part-time employees.

PN224

They have their own heading under 5.1. A mid-shift that has its own heading under subparagraph (3) and staggered breaks as set out below. There isn't a heading, staggered breaks. For present purposes of outlining our submissions, we understand that to be a reference to what is contained under rest breaks on page 16.

PN225

Now, before asking your Honour to look at that, can I remind your Honour of what the award provisions are: 10/20/10 or 20/20 by agreement. That is where you start from under the award. This agreement, of course, to the extent of inconsistency with the award, operates where the inconsistency occurs. In doing so, it creates a new regime because the of the inconsistency.

PN226

So at least in respect of continuous running in distribution, and I want to say it is more than that at the right time, but at least in the context of continuous running in distribution, can I say in summary, and I will go to it, the new regime is that the employees have to agree - I withdraw that - that the rest breaks are to be taken at a time agreed before implementation by the employees and that there is a capacity to have two breaks of 10 minutes combined as 20 and then 20 for the meal and, if so, the employer has a discretion to decide when the break will be taken.

PN227

Can I go to it in detail, your Honour. Rest breaks:

PN228

Rest breaks may be taken at times as rostered and agreed before introduction...

PN229

So when the new regime commenced, the rest breaks before the introduction of continuous running, and of course we haven't got it yet, the rest breaks have to be agreed before introduction:

PN230

...provided that the first break occurs within three hours of the commencement of a shift with the main break occurring within five hours of the commencement of the shift and the final break by no later than one hour before the cessation of the shift.

PN231

Now, that is the rule agreed before introduction and it is to be 10/20/10. It then provides in the last sentence:

PN232

The parties may agree to alternative arrangements to the foregoing if deemed necessary for the operation of continuous running.

PN233

Again, dependent on agreement.

[11.39am]

PN234

The timing of such breaks may differ for employees within each work area depending on the work requirements at the time.

PN235

Well, subject to agreement. In other words, the prospect of different times for employees within each work area still depends upon agreement. And that is the sort of thing the company is trying to do at the moment. It is trying to have a difference in the times at which people will take their break. And then, your Honour, the flexibility is introduced of the 20/20 concept, by agreement the two breaks of 10 minutes each:

PN236

By agreement may be combined thereby enabling employees to take two 20 minute breaks during each shift. These will be taken at times as directed taking into account the work requirements at the time.

PN237

It seems to contemplate a regime where, firstly, 20/20 is depended upon agreement. If it so agreed then there is a capacity in the company to direct that they be taken at times as directed by the company, taking into account the work requirements at the time. And I am not going to, for present purposes, get into the variation concept that "at the time" might or might not have.

PN238

Any variations will be by agreement within the work area and will take into account movements in rest breaks within other work areas of the plant.

PN239

So rest breaks there, at least in relation to distribution, are clearly redolent with agreement - which is not to say in any way that the provisions of 25 don't apply more generally in relation to 25A. Then there is a mid-shift provision:

PN240

Subject to the consultation process, day shift employees may be rostered to commence during the ordinary span of hours, etcetera. These span of hours will be identified in writing.

PN241

Now, as I understand it, at Abbotsford one has the only place in Victoria where packaging occurs in a CUB plant. Also at Abbotsford there is distribution work, and at Altona there is distribution work but no packaging. And that takes us to clause 25B. Again, 25B is one of the facilitative clauses referred to in clause - - -

PN242

THE SENIOR DEPUTY PRESIDENT: Does the dispute arise at Altona?

PN243

MR HINKLEY: I understood, but I am always open for correction, that the application - - -

PN244

MR TUCK: Your Honour, maybe we can assist. Whilst the order that we ought does refer to Altona there is no tension in it - for the purposes of today, this application - for a trial to be conducted at Altona. In terms of what we are asking for, what we have directed, what there is a ban in relation to, is that two-hour trial at Abbotsford.

PN245

THE SENIOR DEPUTY PRESIDENT: I was just checking whether we needed to deal with 25B, but - - -

PN246

MR HINKLEY: Yes. And I think at a practical level it sounds as though we don't, today.

PN247

THE SENIOR DEPUTY PRESIDENT: Today.

PN248

MR HINKLEY: But at an interpretation level the document has to be read as a whole.

PN249

THE SENIOR DEPUTY PRESIDENT: Yes.

PN250

MR HINKLEY: And I am not going to labour it too much. But I just want to draw attention. Again, in the context of clause 25, the facilitative clauses provision speaks in the introduction to enable to effectively meet the work schedule. There will be review. I expect that the review will commence shortly. Introduction of work practices designed to increase efficiency. The purpose is to detail the proposed work practices the company seeks to have implemented.

PN251

They will be done through the consultation process and if issues remain unresolved then dispute settlement. Part-time employees is redolent with agreement and consultation. Just notice the second last grammatical paragraph, in 25B.2 which speaks of agreed variation to the hours of work. 25B.2, hours of work by agreement. And for present purposes I don't think we have to go any further than that. Now, in our submission as a matter of interpretation, and it is a matter of final submissions later, that your Honour can see our position is that when one interprets these clauses, the flag ship clause, clause 25 facilitative clauses, speaking of both 25A and 25B provides:

PN252

The clear recognition by the parties that the implementation of workplace change is to be managed in the terms of the agreement through a process of consultation and agreement.

PN253

I cease reading. And that agreement is at the crux of the matter. Now, we don't - we say on account of that that the absence of agreement by the employees and the union cannot be characterised as the taking of industrial action under section 4, because it in no way departs from the provisions of the agreement. We leave aside evidentiary issues as to - by consent of the employer. And we leave aside evidentiary issues as to health and safety, which is by an exculpatory provision, excluded from the definition of industrial action.

PN254

Now, I think that very brief and certainly not fully fledged analysis indicates what these clauses provide for and where we go. We repeat, your Honour, that those with me at the bar table are more than content to enter into discussions. I understand we are talking now about the trial.

PN255

THE SENIOR DEPUTY PRESIDENT: Yes.

PN256

MR HINKLEY: More than content to enter into that. They do not enter into it on the basis of indicating what negotiation position they will finally adopt in those discussions. They enter into it in the knowledge that it is a matter at the end of the day for the employees, but they enter into it in an environment where they consider that the prospect of consent may not be determined dependent on the provision of money.

PN257

I want to make it clear, your Honour, that is the view of those instructing me who are experienced union officials, can't say that that is the concluded view of the employees, but there is much to be said for the benefit of the views of the union officials being able to further negotiations and have some effect, one would expect, on the consent of the employees.

PN258

Now, your Honour, just finally, can I say that while much has been said about people being informed and that, the position as I am instructed is that there really isn't any definitive explanation of how the process of continuous packaging and distribution would occur at Abbotsford, but that, of course, is a matter for either discussion or submission, and apart from anything else would go to discretion which doesn't resile at all from our jurisdiction arguments. I think that is as much as I had in mind to do at this stage, your Honour, but very happy to go further if - something that your Honour things is helpful, which I suspect isn't at this stage.

PN259

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Hinkley. Mr Maddison, do you want to say anything at this stage?

PN260

MR MADDISON: Just very briefly, your Honour. In respect of the interpretation, certainly the CFMEU is indebted to my learned friend Mr Hinkley's brief submissions in respect of that and we concur with the position put on behalf of the LHMU as the CFMEUs interpretation. Just in respect of just one matter that my friend raised which I can just refer to as the trade practices matter. It may also be, your Honour, that - and it has been held by a full bench of this Commission in a matter dealing with Tenix where an employer has effectively delegated their legislative responsibility and explained to terms to the union, that what the union has put to the members is relevant in terms of the meaning of the agreement. And we may, further down the track, further those matters in relation to veto and the way that the agreement was explained will be relevant in that context.

PN261

In respect of - I did indicate at the outset that we would be seeking an adjournment. Again, I just indicate that and perhaps I have some more fulsome submissions in relation to that but they may be appropriate if we are to go into some more conciliation before proceeding with the - - -

PN262

THE SENIOR DEPUTY PRESIDENT: You mean after we have attempted that process?

PN263

MR MADDISON: Yes. But just again indicating that that is the position of the CFMEU.

PN264

THE SENIOR DEPUTY PRESIDENT: Yes.

PN265

MR MADDISON: In respect of the conciliation, Mr Washington, who is the official responsible for this site, was unable to come this morning due to other engagements. I don't have any instructions specifically about what the CFMEU/FEDFA position is in relation to resolving this matter. If your Honour was in a mind to go into conciliation then I would seek a short adjournment to either seek Mr Washington to attend or for him to provide me with some further instructions so we would be more useful in that process. Noting the time of day, perhaps if we were to do that perhaps after a short adjournment then I would be able to get those instructions or seek to have Mr Washington to attend. That is - - -

PN266

THE SENIOR DEPUTY PRESIDENT: Very well. Mr Nucifora.

PN267

MR NUCIFORA: Thank you, your Honour, the ASU equally concurs with the submissions put by Mr Hinkley on behalf of the LHMU. The ASU does have membership that certainly would be indirectly affected, in some cases possibly directed affected, and we have grave concerns in particular about the application for the section 127 order made by CUB. And we have a direct interest in the LHMUs application for a section 127 order. We, too, would seek - I don't have specific instructions from our organisation except to protect the interests of our members and to the extent that we would concur with the interpretation of the agreement as Mr Hinkley has outlined today.

PN268

Your Honour, if I may add that I may need to be excused around lunch time this afternoon but we would seek to be involved as much as possible in relation to any attempt for conciliation. If your Honour pleases.

PN269

THE SENIOR DEPUTY PRESIDENT: Very well. I certainly believe it is proper that there be discussion. The only matter that I raise with you before making arrangements for that is whether it is more productive for the Commission to be involved from the beginning or whether the parties may wish to talk - we are talking about the introduction of the trial, Mr Tuck.

PN270

MR TUCK: Yes, your Honour.

PN271

THE SENIOR DEPUTY PRESIDENT: I am just making that clear to everybody, that is what I am talking about. Or whether it might be more appropriate for the parties to discuss amongst themselves initially and have recourse to the Commission during the day.

PN272

MR TUCK: Your Honour, I can already indicate that we prefer that you were involved from the beginning, your Honour.

PN273

THE SENIOR DEPUTY PRESIDENT: From the beginning, very well.

PN274

MR HINKLEY: Yes. We are more than content with that, your Honour.

PN275

THE SENIOR DEPUTY PRESIDENT: All right then, that is what we will do. In the light of what Mr Maddison has said, it might be appropriate for us to break now and convert it into an early lunch and resume by way of conference at - - -

PN276

MR HINKLEY: Will your Honour excuse me a minute?

PN277

THE SENIOR DEPUTY PRESIDENT: Yes.

PN278

MR HINKLEY: An hour is plenty of time for us, your Honour.

PN279

THE SENIOR DEPUTY PRESIDENT: That means 1 o'clock.

PN280

MR HINKLEY: Yes, your Honour, if that is convenient.

PN281

THE SENIOR DEPUTY PRESIDENT: All right then. I will adjourn these proceedings until 1 o'clock when I will resume in conference.

LUNCHEON ADJOURNMENT [11.53am]

RESUMED [3.20pm]

PN282

MR T. VEENENDAAL: While we are on the record, your Honour, I might just note an additional appearance for the union. I appear for the Australian Liquor, Hospitality and Miscellaneous Workers Union. I don't think Mr Hinkley actually registered my appearance initially.

PN283

THE SENIOR DEPUTY PRESIDENT: Very well, thank you, Mr Veenendaal. There have been negotiations between the parties in the matter and I would ask you, Mr Tuck, to place on the record your understanding of the position that has been reached.

PN284

MR TUCK: Your Honour, a document was prepared by the company and put to the unions. That document is framed as an agreement and I would seek that it be at least marked, your Honour.

PN285

THE SENIOR DEPUTY PRESIDENT: I will mark it.

MFI EXHIBIT #CUB1 DOCUMENT PREPARED BY THE COMPANY AND SUBMITTED TO THE UNIONS

PN286

MR TUCK: Your Honour, the document speaks for itself. It is prefaced on the basis that the unions will recommend to their members employed by CUB on the relevant line subject to continuous running that they participate in a work trial which is commencing 3 October, that is tomorrow, and that the work trial be conducted from 3 October to 2 November 2002 and during the work trial CUB will seek to provide to the employees participating in the work trial those benefits enjoyed by other CUB employees at Abbotsford who are presently working with continuous running, including extra crib time and early finish of shifts when production allows.

PN287

The agreement also contemplates that the discussions will be held at the work area level between the CUB and the unions to raise issues regarding the implementation of continuous running work trial including issues of occupational health and safety, that any issues not resolved at that level will be discussed at the business process level, that CUB undertakes that no full time positions will be lost as a result of the implementation of continuous running, and that during the work trial when recommending the work trial the union and each of them not encourage, persuade or instruct the CUB employees not to participate in that work trial, and that the parties will be brought back to you, your Honour, at the end of every working week - we have contemplated on the Friday of every week - during the work trial, and that the parties reserve all rights regarding the issue of the introduction of continuous running in the production and distribution at the end of the trial process; and that is understood.

PN288

Now, your Honour, the parties have taken that document as far as they can today. The unions have indicated, and whilst the people here may be willing to support that document, the unions have asked for the opportunity to take the document back to the shop committee to determine whether or not they will be able to make the recommendations and fulfil the terms of that undertaking.

PN289

Your Honour, that resolves today and your Honour has indicated that you are not available to deal with this matter tomorrow or Friday nor Monday, and that the next available dates are 8 and 9 October next week. Your Honour, to use the time usefully today, what we would seek to do is that the company has prepared two witness statements. These statements were provided to the unions before the commencement of today's hearing this morning. There is a statement by Mr David John Whytcross and a statement by James Cameron Houston. We would seek to tender those statements, your Honour. The witnesses will be available to be sworn in next Tuesday.

PN290

THE SENIOR DEPUTY PRESIDENT: I will mark these for identification at this point.

MFI EXHIBIT #CUB2(I) WITNESS STATEMENT OF DAVID JOHN WHYTCROSS

PN291

MR TUCK: Another document that was the subject of some discussion during the break, your Honour, was a document of a slide show headed: Continuous running, and I believe that the unions have been provided with a copy of this document. We would also seek to rely on that document.

PN292

THE SENIOR DEPUTY PRESIDENT: Do you wish to tender it?

PN293

MR TUCK: I tender that.

MFI EXHIBIT #CUB3(I) STATEMENT OF JAMES CAMERON HOUSTON

MFI EXHIBIT #CUB4 DOCUMENT CONSISTING OF A NUMBER OF OVERHEAD SLIDES HEADED: CONTINUOUS RUNNING, SEPTEMBER 2002

PN294

MR TUCK: Your Honour, there is one further document. It is not so much an exhibit in the hearing; it is more of an aide memoire as it is described in the courts. It is document, this is a chronology of events but I would probably seek to refer to this document in submissions and I would like to put it formally before you, and I have provided the unions with a copy of that document.

PN295

THE SENIOR DEPUTY PRESIDENT: Very well. I will accept it on that basis, that it is an aide memoire.

PN296

MR TUCK: Thank you, your Honour.

PN297

THE SENIOR DEPUTY PRESIDENT: Yes.

PN298

MR TUCK: That completes my task for this afternoon, your Honour.

PN299

THE SENIOR DEPUTY PRESIDENT: Very well. Thank you, Mr Tuck. Mr Veenendaal.

PN300

MR VEENENDAAL: Yes, thank you, your Honour. Broadly I think Mr Tuck reflects the position that the parties got to in conciliation. I just want to make it very clear on the record, your Honour, that point 1 and 7 in the document which is exhibit CUB1 we say are tempered, or at least need to be qualified by the point that Mr Tuck made, and that goes to the issue that the unions have, in fact, agreed to take the document or the heads of agreement to the shop committee and, provided the shop committee accepts the propositions that are put in the document, then clearly the shop committee recommendation will be put to the relevant employees in the areas B1, B2 and C1 in terms of the contemplated work trial, or the work trial that is contemplated to commence and is facilitated by the document.

PN301

And the only other point I make, your Honour, is that the dates, particularly the dates at paragraph 2 of CUB1, need to obviously be considered in the context that it is unlikely a work trial would be able to commence tomorrow, which is 3 October, on the basis that I would have anticipated from discussions I have had with the company that it is unlikely that a meeting of the members would be able to be convened in the relevant work trial areas, proposed work trial areas on the 3rd. But if it can, in fact, be accommodated on the 3rd, we have no difficulty with that. I just think there is some logistical and shift arrangement issues that I apprehend in that regard.

PN302

I think that is all I probably need to say at this point, your Honour, save that we simply reserve our rights in respect to exhibit CUB2(i) and CUB3(I); that is the witness statements that have been tendered from Mr Houston and Mr Whytcross. I foreshadow that we will be seeking to cross-examine those witnesses at an appropriate point and that may well be Tuesday, your Honour. If the Commission pleases.

PN303

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Veenendaal. Mr Wainwright.

PN304

MR WAINWRIGHT: Your Honour, I endorse and adopt the submissions of the LHMU and have nothing further to add.

PN305

THE SENIOR DEPUTY PRESIDENT: Thank you. For my part, I note that the matters that have been produced as a result of the conciliation conferences and by the parties themselves are without prejudice in every respect. I also note that the Commission will sit on Tuesday, 8 October, and Wednesday, 9 October, to hear the matters that have been filed and have been called on today. I direct that for the further conduct of those matters any witness statements to be relied on by any of the parties on Tuesday or Wednesday be filed in the Commission and served on the other parties not later than the close of business or 5 pm on Monday, 7 October. Just so that there is no misunderstanding, I take it that the report back will be precisely that, and that it can be conducted by telephone.

PN306

MR TUCK: Yes, your Honour, that would be my understanding.

PN307

THE SENIOR DEPUTY PRESIDENT: I didn't want to let people get the impression in the Commission that I was going to be coming down to Melbourne for a report back every Friday for the next six weeks. But there will be a report back, as the parties have agreed, or potentially have agreed. It will be on the Friday and it will be by telephone.

PN308

MR VEENENDAAL: Can I apprehend that is a three-way conference then, that report back?

PN309

THE SENIOR DEPUTY PRESIDENT: Yes.

PN310

MR VEENENDAAL: Yes, your Honour.

PN311

THE SENIOR DEPUTY PRESIDENT: Well, it will be - if you count the Commission, it will be the Commission, CUB, yourself, Mr Wainwright or his organisation, and indeed any of the unions who wish to participate. I think that completes the proceedings for today. I adjourn these proceedings until Tuesday next at 9.30 am in Melbourne.

ADJOURNED UNTIL TUESDAY, 8 OCTOBER 2002 [3.34pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

MFI EXHIBIT #H1(I) EDA 2000 HIGHLIGHTS ISSUED IN SEPTEMBER 2000 PN133
MFI EXHIBIT #CUB1 DOCUMENT PREPARED BY THE COMPANY AND SUBMITTED TO THE UNIONS PN286
MFI EXHIBIT #CUB2(I) WITNESS STATEMENT OF DAVID JOHN WHYTCROSS PN291
MFI EXHIBIT #CUB3(I) STATEMENT OF JAMES CAMERON HOUSTON PN294
MFI EXHIBIT #CUB4 DOCUMENT CONSISTING OF A NUMBER OF OVERHEAD SLIDES HEADED: CONTINUOUS RUNNING, SEPTEMBER 2002 PN294