C2002/5092, Transcript of Proceedings [2002] AIRCTrans 4269 (30 October 2002)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

C2002/5092

APPLICATION TO STOP OR PREVENT
INDUSTRIAL ACTION

Application under section 127(2) by
Pentroth Pty Ltd for orders in respect to
the Construction, Forestry, Mining and
Energy Union and Another

ADELAIDE

11.35 AM, MONDAY, 14 OCTOBER 2002

PN1

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

PN2

MR R. MANUEL: I seek leave to appear as counsel for Pentroth.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Manuel.

PN4

MR M. O'MALLEY: I appear for the CFMEU.

PN5

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr O'Malley. Mr O'Malley, Mr Manuel has sought leave to appear. Do you oppose his application in that respect?

PN6

MR O'MALLEY: Yes, I do.

PN7

THE SENIOR DEPUTY PRESIDENT: Perhaps you could tell me then, Mr Manuel, why it is that you would need to be granted leave?

PN8

MR MANUEL: Yes. I must admit. The first basis was because I expected my friend, Mr Harrison - I mean no disrespect to Mr O'Malley, but I had expected Mr Harrison to be present. I understand he is not well. Fundamentally these two applications - I note only one is called on at the moment - tend to give rise to some fairly technical - or can give rise to some fairly technical issues of law. In respect of the section 127, there are issues of jurisdiction that must be satisfied for the Commission and then there are issues of balance of convenience which have to be dealt with as well.

PN9

Our position is that our client can only effectively be represented in respect of that issue by counsel. I will take you if I may briefly to section 42 of the Act which provides at 42(3)(b) and by leave of the Commission, if the Commission is satisfied having regard to the subject matter of the proceeding, there are special circumstances or (c) by leave of the Commission if the Commission is satisfied that the party can only adequately be represented by counsel, solicitor or agent.

PN10

Now, if I could just make a quick note for you. In the last paragraph (c), that is the one - we rely upon both of course - the paragraph (c) draws no distinction between counsel, solicitor or agent and so insofar as there might be an argument put that my friend Mr Howard could represent Pentroth, he would need leave as well and if he was entitled to leave, then we with respect so would I be under 3(c). Basically our fundamental is in regards to the 127, we can only be adequately represented by counsel due to the technical complexities of the matter.

PN11

Also of course, the ramifications that flow. Now, I'm not for a moment suggesting if the Commission was to grant orders that the CFMEU would not comply with them but there is that possibility and that then brings the matter before the Federal Court of Australia where leave to appear is not required but where there can be problems caused by what may have gone on below. So on that basis we say we should be entitled to appear.

PN12

In respect of the 166A application, I don't know whether it is your Honour's intention to call that on at the same time. I must admit I had prepared on that basis but similar considerations apply. There are two issues as we see them. Firstly, if we are going to hear the 166A and the 127 and we are entitled to representation or are allowed to represent on the 127, then it would be a clumsy, with respect, approach to then separate the representation issues.

PN13

However, in any event, 166A has its own complexities and particularly because the purpose of 166A is to be able to move the matter to a superior Court of record for both injunction and damages and as a consequence 166A is the fundamental underpinning of the jurisdiction of such an action, we say that again our client can only effectively be represented by counsel. May it please the Commission, those are our submissions.

PN14

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Manuel. Mr O'Malley?

PN15

MR O'MALLEY: Yes, thank you, Mr Commissioner. I suppose for the same reason that we just heard that Mr Manuel's client deserves or should have legal representation, the same applies to my organisation and to my employee. Unfortunately, Mark Harrison who would normally represent us was in hospital over the weekend. I haven't been able to talk to him about it. He thought he might be back today but apparently he has to stay in until he sees the specialist. I haven't had the opportunity to brief any other legal counsel.

PN16

I would suggest that instead of making a decision on that, if we could seek an adjournment for maybe for the rest of the day so that I can seek legal counsel outside of Mark Harrison, then perhaps I will do that. Certainly if it goes ahead without me having legal representation, then we certainly put that my organisation be put at a very serious disadvantage. I'm not a lawyer. I'm not legally trained and therefore I would seek that you would rule that (1), there is an adjournment or (2), at least Mr Manuel can't be entertained for this period.

PN17

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr O'Malley. What I propose to do is to grant leave for Mr Manuel to appear by virtue of section 43 - sorry 43(2)(b). I perhaps need to make it clear to Mr Manuel that I'm sure that I agree with his argument in relation to the construction I should put on 42(3)(c) but I will grant leave pursuant to 42(3)(b). In doing that, I will indicate that I'm granting leave for the purpose of what I would expect today to be a relatively brief hearing and in the event that Mr O'Malley wants to jump to his feet at some point in those proceedings to indicate that he is being disadvantaged by the lack of representation, then I will certainly hear him in that regard.

PN18

MR MANUEL: Your Honour, I can't see the reason - - -

PN19

MR O'MALLEY: Quite frankly, we won't be sitting around waiting for it, we will be leaving.

PN20

THE SENIOR DEPUTY PRESIDENT: Mr O'Malley, I note you are leaving these premises. Very well, Mr Manuel?

PN21

MR MANUEL: Your Honour, I was actually going to say to you that we would have no objection to an adjournment for the CFMEU if it was minded - or if it was driven by the view that it should be represented by counsel. Could I respectively suggest that once the CFMEU and Mr Feehan have left the courtroom, which they have now, then any issues of natural justice or fairness have been satisfied because they have denied themselves the opportunity to make an application to the Commission to adjourn the matter.

PN22

On that basis, I would seek to proceed to convince the Commission that 127 orders should issue and also that a certificate should be allowed under section 166A but obviously I'm in your hands, your Honour.

PN23

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Manuel, I also noted that Mr O'Malley has chosen to somewhat abruptly leave the courtroom. I was going to continue with my comments in relation to your application to provide the parties with the benefit of the notes that I have made in relation to earlier proceedings in relation to the CFMEU and Pentroth Proprietary Limited. Those notes were to the effect that on 9 October 2002 I refused to certify a section 170LK agreement on the basis that the only employee to be recovered by that agreement was not, at the time the agreement negotiated and signed, actually an employee of the employer.

PN24

The application for certification of this agreement was accompanied by a section 99 application which I listed for conference on 10 October 2002. At this conference, the CFMEU advised that it considered that there was a possibility of a claim at common law for observance of that employment offer. The CFMEU indicated that it was now seeking a section 170LJ agreement with the employer. The CFMEU noted that no work had been undertaken on the construction site on 10 October 2002 but that this was due to the lack of electricity rather than industrial action.

PN25

The CFMEU foreshadowed a claim for payment for that day. the CFMEU advised that it had now filed and served notices for bargaining periods and intentions to take protective action. Mr Howard, from the Master Builders Association then representing the employer, advised that it considered that there was a common law contract in existence. Further, in the event of further proceedings in this matter, Mr Howard advised that it was likely that the employer would be represented by EMA Legal.

PN26

Mr Howard advised that discussions with Mr O'Malley of the CFMEU had established that the union was prepared to discuss the issue and that no industrial action would occur whilst these discussions were under way. The employer expressed concern that he understood that the employee in question was prepared to sign and agree to a revised certification but was being stopped from doing so by the CFMEU. I advised that I was not prepared to discuss or consider issues relating to payment for time not worked and that further, in the event that the employee considered that the actions of the CFMEU in relation to its member were improper, then advice on the provisions and the requirements of the Act should be sought in that respect.

PN27

I advised that as there was then a notice of intention to take industrial action and a notice of intention and a notice of bargaining period, the Commission's powers pursuant to section 99 of the Act were significantly reduced. The option existed for both parties to engage in industrial action. Notwithstanding that, both parties asked me to keep the file open as they perceived that it was possible that they might seek the assistance of the Commission at arriving at an agreed resolution to the matter.

PN28

Now, it is indeed most unfortunate that Mr O'Malley has chosen to leave the courtroom because I was intent upon proceeding with this hearing today on the basis first of all that I would be seeking some indication from both parties as to where the matter had come off the rails. I was going to follow that up with a suggestion that the experience that I've had of the dealings between various building contractors, particularly the Master Builders Association and Mr Howard representing those contractors.

PN29

In the experience I've had of the CFMEU including Mr O'Malley and indeed Mr Harrison indicates to me that there is generally the scope for the parties to arrive at agreed solutions. Common sense generally prevails. In fact, I was going to remind both parties that at the conference before me on 10 October, the parties spent some little time discussing with some degree of pride I might say, the extent to which the South Australian building and construction industry was not characterised by some of the behaviour that has been remarked upon by the Building Industry Royal Commission.

PN30

That was going to lead me to applying some pressure to you, Mr Manuel, to suggest that it would be perhaps more appropriate that the parties have yet another go at resolving their differences by way of discussions rather than reliance upon the legal processes embodied in both section 127 and 166A. So indeed it is a pity that Mr O'Malley has chosen to leave the courtroom. I do however intend to proceed this morning with your application.

PN31

MR MANUEL: Yes, sir. Your Honour - - -

PN32

THE SENIOR DEPUTY PRESIDENT: In doing so, I'm going to advise that I will need to take a brief adjournment. You would be aware this matter was listed at short notice. Given that it is now going to proceed for a little longer than I had anticipated or in fact hoped, I will need to take an adjournment for some 5 minutes or so to arrange the rest of my afternoon.

PN33

MR MANUEL: Yes. I understand that, your Honour. I wonder whether - again as a matter of some level of efficiency - I think we might be able to deal with the 166A in fairly short order.

PN34

THE SENIOR DEPUTY PRESIDENT: Yes. I intend to deal with both matters at once. If they weren't called on as such, I apologise.

PN35

MR MANUEL: Of course.

PN36

THE SENIOR DEPUTY PRESIDENT: I do intend to deal with both matters in the one hearing.

PN37

MR MANUEL: The reason why I believe we can deal with the 166A fairly quickly is this. I'm mindful that I don't wish - and nor does my client - wish to take unfair advantage of the absence of the CFMEU and so I have been giving that some thought while your Honour has been setting out the history of the matter. The basis of the 166A application was a threat by Mr Feehan on Friday that if my client did not plumb the - or bring the sewer into the toilet, then - and continued to use chemical toilets, then it would be subject to some ban on some piling work.

PN38

Now, we haven't officially been informed that there are no bans arising from that threat but there has been some unofficial indication. What occurs to me though, your Honour, perhaps more importantly is that the fact that the plumbing has been done would suggest that the conduct has been brought to an end. That may be somewhat convoluted but in the sense that if the threat is unless you do something, we will take action, and then the something is done, then the threat is really otiose. In effect if is complete.

PN39

As a consequence, what I would be requesting your Honour to do is a couple of things but fundamentally is to find that the 166A is no longer appropriate as a consequence of that action by my client but in effect to count the time that has run until that occurred so that if my client is required to proceed back before the Commission again seeking a 166A certificate, and as an aside we hope we are not required to, then part of the 72 hour period has already expired. So as a consequence, what I would be asking your Honour to do is two things.

PN40

One is to in respect of Mr Feehan to find that service occurred at 7.30 pm on Friday 10 October, because that is when there was an attempt to service Mr Feehan at the CFMEU office, that was unsuccessful. Therefore he was served at home. The rules set out that there should be service before filing but because of their concern about the stoppage of work today, there was a filing immediately after the service on the CFMEU. Now, what we say is under rule 6 of the Workplace Relations Rules.

PN41

You are in fact entitled to provide relief from the rules in appropriate circumstances. We would say in this case Mr Feehan - the documents have been served on his place of work. There was a - as you will see from the affidavit of service of Mr Burke - there was a marked reluctance to provide any assistance in terms of the service of those documents. They were clearly effectively served on the CFMEU at the time. So at that time, there's no doubt that the 166A could be filed.

PN42

In respect of Mr Feehan, he has had fair notice and as you can see, he has been in attendance today, albeit for a short period of time. So what we would be asking is that there be relief from the Rules insofar as is necessary under Rule 6 and then that your Honour in effect stop the clock on the 166A proceedings based on the completion by the employer of the plumbing. Now, it will be difficult, and I apologise for this, it will be difficult for the Commission to specifically identify the time of day when that had been completed or when it had been communicated to the CFMEU.

PN43

We could at least if a conservative approach was taken, that is the early as possible time was considered to be counted for the purpose of counting the time that that would still be a fair and reasonable approach to take.

PN44

THE SENIOR DEPUTY PRESIDENT: Mr Manuel, as I indicated to you, I'm going to need to take a short adjournment. I have another commitment. I'm happy to debate the issue and I might say that I will need to debate it because I'm uncomfortable in terms of a number of aspects of your aspect.

PN45

MR MANUEL: Yes.

PN46

THE SENIOR DEPUTY PRESIDENT: I don't imagine I will be more than 5 or 10 minutes at the most but I would ask you to remain in the presence of the court.

SHORT ADJOURNMENT [11.50am]

RESUMED [12noon]

PN47

MR MANUEL: Your Honour, we will probably resolve the section 166A issue, we don't seek to pursue it at this stage. We would prefer to focus on the section 127 a matter before the Commission.

PN48

THE SENIOR DEPUTY PRESIDENT: Very well, perhaps before you do leave the 166A, Mr Manuel, it would be fair of me to indicate to you that whilst I'm prepared to waive the requirement in terms of serving of the application I was going to put you to a number of further questions in relation to the time period - as you are not proposing to proceed with the 166A I won't both with those questions.

PN49

MR MANUEL: Yes, I must admit I'm - I would doubt that I could have given you a particularly specific answer in that, all I could have done is put a witness in the witness-box and see how it panned out at the time.

PN50

THE SENIOR DEPUTY PRESIDENT: I think it only fair to indicate to you that for the future, part of the dilemma that I have relates to the very late receipt of the section 166A and 127 applications - - -

PN51

MR MANUEL: Yes.

PN52

THE SENIOR DEPUTY PRESIDENT: - - - on Friday afternoon and the need to ensure that the principles of the natural justice don't work against one particular side or the other.

PN53

MR MANUEL: No, I should say - - -

PN54

THE SENIOR DEPUTY PRESIDENT: But I don't think we need to take that matter further at the moment any rate.

PN55

MR MANUEL: No, no, I understand the comment, I understand the comment. Perhaps I might - if I could just set out briefly what the planned approach is. I would like to give you the facts as we understand them and then go to some technical issues and put forward some of the documentation that I think is necessary to satisfy your Honour that you have jurisdiction. My proposal is to put this information from the bar table and only call evidence insofar as your Honour requires further clarification.

PN56

It goes without saying but I will say it anyway that what I'm putting to you is on the instructions of my client and if your Honour requires any further clarification or elucidation that I can obviously call a representative of my client to support that information. Pentroth is a civil construction business, it conducts a range of activities but at the present time the matter that we are concerned with is a site in Frome Street Adelaide. Now, what is occurring there is the very early stages of the construction of a seven storey hotel complex. It has only been going for about 3 weeks and is due for completion in approximately November 2003.

PN57

Pentroth is the head contractor of the project. It only has - well, if you like it has two employees, the site manager and a safety officer on site. Then what happens as you understand from all civil construction work and construction work generally is that subcontractors are bought in for varying blocks of time to carry out specific tasks. Right at this moment, the only contractor who is on site is a company by the name of Vadasz, it has three employees of its own on site - - -

PN58

THE SENIOR DEPUTY PRESIDENT: So that is Vidaz or - - -

PN59

MR MANUEL: Vadasz, that is V-a-d-a-s-z, I will hand up the work - the certified agreement of M.C. Vadasz trading as Australian Piling Company Enterprise Agreement.

PN60

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN61

MR MANUEL: This is probably an appropriate time to make a little bit of an explanation about this. I had proposed to hand up a certified agreement for McMahon Services. McMahon Services has been on site with employees doing work but right at the moment it has stopped, it may well come back but this is the nature of these building sites that the employees on site will rotate and change on a fairly regular basis. So what I'm putting before you now is the enterprise agreement of the organisation which is currently on site and what we say is that underpins your jurisdiction in the matter but that there will be as time passes - I mean for instance, Vadasz is involve in piling work.

PN62

Once the piling is complete Vadasz, one would expect would cease to be on site but there will be other contractors who will come in in their place. So what we are putting to you at the moment is a snapshot of the current situation that applies. I don't know whether you wish to mark that agreement or just take it as being part of the public record or - - -

PN63

THE SENIOR DEPUTY PRESIDENT: I don't normally mark agreements as such - - -

PN64

MR MANUEL: No.

PN65

THE SENIOR DEPUTY PRESIDENT: - - - so I will take it as a document drawn, probably from that wonderful creature Cordaserus.

PN66

MR MANUEL: That is correct, your Honour, I should - - -

PN67

THE SENIOR DEPUTY PRESIDENT: I congratulate your staff rather than you on being able to find it.

PN68

MR MANUEL: Yes, that is certainly true. The features of this agreement are not particularly noteworthy, the only feature that we really draw your attention to is the period of operation. If you look at clause 1.7 you will see that it will operate until 1 April 2003 and we will obviously come back to that in respect of any action being taken by the CFMEU. Now, your Honour has already set out his understanding of the negotiations that have occurred with the assistance of the Commission in respect of Enterprise Bargaining.

PN69

Now, the MBA, the Master Builder's Association is instrumental in organising an Enterprise Bargaining Agreement between Pentroth and its single employee. Now, there was a dispute about that with the CFMEU and I think your Honour himself referred to the CFMEU wishing there to be an order under section 170 - sorry, an agreement under section 170LJ as opposed to the 170LK agreement that had been put forward. Now, as a result we say of the Enterprise Bargaining dispute, there have been a number of steps taken by the CFMEU to exert pressure upon Pentroth.

PN70

Now, on 25 September it put in place a ban on the movement of a temporary fence on the site. Now, the reason why the temporary fence had to be moved, as I understand, was to enable the power or the permanent power connection to be put on. There were officials of the union involved including Mr Feehan who physically prevented the construction of the fence. Now, as a consequence - - -

PN71

THE SENIOR DEPUTY PRESIDENT: I thought you were talking about its removal?

PN72

MR MANUEL: Well, there had to be removal a the temporary fence as I understand it, and construction of a permanent replacement.

PN73

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN74

MR MANUEL: My apologies, that was my laxness. There was a dispute hearing set down and the - for 2 October 2002 before this Commission and the - as a consequence the ban was lifted approximately 1 hour prior to the commencement of the dispute hearing. Now, the point I need to make about this is that this is the start of a course of conduct that will inform the Commission as to the need to put in place orders to stop this type of wild cat action continuing on an ongoing basis because what my client is fundamentally concerned about - the history will bear it out, is that from any day it does not know whether its employees are going to turn up to work or not.

PN75

Or whether they are going to be removed by the direction of the CFMEU and Mr Feehan or whether they are going to have bans put in place limiting the ability to carry out their job properly. The other important point is that this industrial action is being carried out by persons other than employees of Pentroth. Now, that is important for two reasons, one is because it is impossible to have protected action in those circumstances which I will come to in due course, but also it is improper under the Workplace Relations Act to use third parties in order to coerce an employer into entering into an Enterprise Agreement.

PN76

Now, is one of the more ironic parts of this dispute - and you will note from my previous statement that the ban had been lifted on approximately 2 October at approximately 1.30 pm. On 10 October Mr Feehan attended the site and noted that there was no permanent power connection to the lunch room. Now, the reason that there wasn't a permanent power connection to the lunch room was because of the CFMEU industrial action that was called and as a consequence the ETSA workers were unable to install a permanent - - -

PN77

THE SENIOR DEPUTY PRESIDENT: I'm sorry, Mr Manuel - - -

PN78

MR MANUEL: Yes, your Honour.

PN79

THE SENIOR DEPUTY PRESIDENT: - - - I need to keep interrupting you as I'm daring to come - - -

PN80

MR MANUEL: Of course.

PN81

THE SENIOR DEPUTY PRESIDENT: - - - to grips with the mystery that you have obviously spent some time pawing over, but I thought you told me that the ban had been lifted on 2 October - - -

PN82

MR MANUEL: Yes, that is - - -

PN83

THE SENIOR DEPUTY PRESIDENT: - - - and that begs the question of what happened between 2 October and 10 October?

PN84

MR MANUEL: My understanding is that ETSA had been organised to install the permanent connection but in that period in which the ban was in place. I further understand and I will just confirm this in a moment, that it is not just a matter when the ban is lifted of saying to ETSA: okay, now come forward and put our connection on. You have to organise the work again and that is where there is a inherent delay in the process. I have had that confirmed from instructions. So in other words you are absolutely right, there is a window of about a week before - between the ban being lifted and Mr Feehan coming on to the site, but it was not possible to organise ETSA to come back because they had already been organised once and it had to be put off.

PN85

So that is now, I might add, there is a - my apologies for that, ETSA won't be able to install permanent power until this week some time. So - but that delay wasn't the delay of the employer it was the delay caused by the CFMEU. Now, as a result of Mr Feehan's observation, he then directed workers to go home at midday because of that.

PN86

THE SENIOR DEPUTY PRESIDENT: Whose workers?

PN87

MR MANUEL: Well, yes, at the time I think it was McMahon's - was on site at that time and Vadasz Piling. So McMahon's who were on site at that time were asked or told by the union to go home. Vadasz was also on site and were told to go home. Now, I am more than happy to give you a copy of the McMahon's Services Agreement to show that they are also covered by Federal Industrial Instrument. In fact, as a matter of completeness, I think that would be appropriate. But what I would note is they are not currently present on the site.

PN88

THE SENIOR DEPUTY PRESIDENT: Mr Manuel, the interest once again - thank you - of my understanding of the matter, when you say that Mr Feehan attended the site, noted that there was no power direction - now power connection and directed the McMahon and Vadasz Piling workers to go home - - -

PN89

MR MANUEL: Yes.

PN90

THE SENIOR DEPUTY PRESIDENT: - - - my understanding of this matter from the earlier proceedings and my earlier comments today, is that Pentroth have one employee in the matter - - -

PN91

MR MANUEL: Yes.

PN92

THE SENIOR DEPUTY PRESIDENT: - - - at the present time. Now, what that employee also involved in this action?

PN93

MR MANUEL: Yes, he was, your Honour.

PN94

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN95

MR MANUEL: I think it is fair to say that despite the fact that the employee concerned is keen to work for our client, it is not worth the aggravation to buck the system as it were and so if there is a direction from the CFMEU he goes home as well.

PN96

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN97

MR MANUEL: On the Friday at about 7 am without any previous notification, Mr Feehan arrived on site and directed workers to stop work and they had a stop work meeting for approximately half an hour and again - and again, you can work on the basis that that was all the workers who were present on the site including the employee of Pentroth. There was then a further discussion between the site supervisor - - -

PN98

THE SENIOR DEPUTY PRESIDENT: So can I clarify that once again - - -

PN99

MR MANUEL: Yes.

PN100

THE SENIOR DEPUTY PRESIDENT: - - - that that was the employee of Pentroth?

PN101

MR MANUEL: Yes.

PN102

THE SENIOR DEPUTY PRESIDENT: The Vadasz Piling workers?

PN103

MR MANUEL: Yes.

PN104

THE SENIOR DEPUTY PRESIDENT: And at that point the McMahon constructions?

PN105

MR MANUEL: McMahon as well, yes.

PN106

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN107

MR MANUEL: McMahon was still on site at that time. There was then a discussion between the site supervisor Mr Lindsay and Mr Feehan regarding the safety risk. Now, what this safety risk was allegedly was the use of chemical toilets on site. Now, chemical toilets are not uncommon on building sites. They may not be preferable but they do not pose an imminent risk to people's safety. Nevertheless what Mr Feehan said was: if you don't have these plumbed in by today, being Monday 14 October, there will be a ban on the piling work. Now, if there is a ban on the piling work that basically as with all construction sites, one point follows the other.

PN108

The ban on the piling work will in fact stop the site until the piling work is completed. Now, the couple of comments we make about that, firstly, there was no indication that there was any relationship between the piling work and the chemical toilets. In other words, there was in effect going to be a punishment of the employer rather than any attempt to deal with some genuine safety issue. If there was some genuine safety issue, the way it would be dealt with would be through the Occupational Health, Safety and Welfare Acts, such as default notice and prohibition notice.

PN109

Instead what there is is we don't like these toilets therefore we are going to ban anyone from doing the other work on site. Now, that has the clear taste and smell of industrial tactic, not occupational health and safety. Perhaps smell is not quite the best term to use in these circumstances.

PN110

THE SENIOR DEPUTY PRESIDENT: I think you might need to use some different terminology.

PN111

MR MANUEL: Yes, it might be better if I did.

PN112

THE SENIOR DEPUTY PRESIDENT: And we will stay away from taste.

PN113

MR MANUEL: Mr Feehan was asked by Mr Lindsay: look, are there any other issues that you have got with this site? Mr Lindsay is obviously trying to sort this matter out and what Mr Feehan said was words to the effect of the following: tell Sterios, who is one of the senior managers, he needs to sort out all issues with my boss, and what has been assessed on that basis is that this is actually a softening up process directed against the company for the purposes of the Enterprise Bargaining process. It is not difficult to imagine that the conduct of this kind particularly if it continues, will delay the project.

PN114

My client has contractual obligation and part of that obligation as with all building sites, is to finish the site on time unless it is appropriately stopped on the basis of some force majeure event. It has obligations to the people who are supplying it with raw materials and the like to meet and any delay that is caused costs it money. It also costs the suppliers money, it costs the contractors money. It also costs the employees who are forced to go home, their wages for that day. Putting aside any arguments about whose responsibility they were for the moment. So there is clear damage in terms of the balance of convenience.

PN115

It is difficult to imagine what disadvantage is suffered by the CFMEU but of course we have been denied that opportunity today. In terms of one other issue which I think is important with respect and that is the issue of protected action. There has been the commencement of a bargaining period by the CFMEU and on 2 October, which was interestingly enough the last day of the ban, an attempt - no, the issuing of an action - a notice for protective action - I was going to call it an attempt because we say it is clearly invalid but I will take you through those if I may.

PN116

THE SENIOR DEPUTY PRESIDENT: Thank you, I will mark those documents.

PN117

MR MANUEL: Yes, your Honour.

EXHIBIT #P1 CORRESPONDENCE TO THE DIRECTOR OF PENTROTH CONTRACTS FROM THE CFMEU DATED 20/08/2002 WITH ATTACHED DOCUMENTATION

EXHIBIT #P2 CORRESPONDENCE FROM THE CFMEU TO PENTROTH CONTRACTS DATED 02/10/2002

PN118

MR MANUEL: Thank you, your Honour. Your Honour, could I take you to both those documents and the first is P1 which is the notice of initiating a bargaining period. It is a reasonably, with respect, unremarkable document and what we would draw your attention to is two things. Firstly, in the covering letter you will see that Mr Feehan is the officer with carriage of this matter, in other words this letter clearly ties him in specifically to the carriage of the Enterprise Bargaining matters with Pentroth and he is also the same person who imposes all the industrial action against Pentroth. And so we say that is a matter on which you can make an inference.

PN119

The second is, and this is we say very important, is that the commencement of the bargaining period is only against Pentroth Contracts. Now, putting aside for a moment that the company is not strictly correctly named, what it means is that the protected - any protected action must be in respect of Pentroth and we will take you to the legislation and some authority which shows that if you seek to use a third party for protected action, it is not possible. If I could briefly take you to P2, this is the notice that purports to seek protection for some industrial action and I will take you to the last paragraph:

PN120

The industrial action will consist of a stop work meeting, bans, limitations and stoppages and will commence on Thursday 10 October 2002.

PN121

Now the point I will make and I will reinforce this with the decision of the Federal Court of Australia, but if you look at the descriptions, they are inherently uncertain. The purpose of the protected action provisions is to enable the employer to defend itself or to make arrangements to defend itself. There is good authority that things such as bans, limitations and stoppages is insufficiently precise and the reason for that is, it tells you nothing about the nature of the bans and the Act requires that the nature of the Act should be stated. In other words, there is no indication when stoppages will occur, by whom they will occur, for how long they will occur.

PN122

Likewise you can make the same comments about the bans limitations. It is arguable that a stop work meeting may be a sufficient description, because it is clearly singular, but it does not actually say when the stop work meeting was going to commence. All it says is:

PN123

This action, being all of the action, will commence as of 10 October.

PN124

That is not to say the stop work meeting will commence on that day, so what we would say is this is fundamentally invalid. If I can hand you a copy of the decision of his Honour, Von Doussa J, this is actually reported at 2002 113 Industrial Courts page 104. The reason why I put this decision forward is because most of these decisions tend to revolve around interim injunctions, and so they don't actually determine the questions. They just find out whether - or they just hold whether or not there is a serious question to be tried.

PN125

In this case, there was an application made by Adelaide Brighton Cement to the Federal Court, and his Honour actually issued permanent injunctions so this is actually a matter where it has gone beyond the issue of a serious question to be tried. If I could take your Honour to page 107 of the Report of Decision, his Honour cites with approval the Full Court's comments in Davids Distribution Proprietary Limited v National Union of Workers, which is reported in two places, 1991 Industrial Reports 118, and again at [1999] FCA 1108; 165 ALR 550.

PN126

What the Full Court does there is set out in some detail the fundamental requirement that notices must be sufficiently particular in order to enable the employer to defend itself. Now, if you look at the first sentence, it sets out very nicely the thrust of the section.

PN127

We think section 170MO(5) was designed to ensure that industrial disputants who either become affected by protected action in relation to which their usual legal rights are significantly diminished are at least able to take appropriate defensive action.

PN128

His Honour only goes through and discusses the various arguments, and if can take your Honour to page 110 because this bears fairly closely on the point. What had happened in the notice being given to Adelaide Brighton Cement was there had been a reference to the imposition of 24 hour rolling stoppages. Now, what his Honour, Von Doussa J said in response to that was:

PN129

In my opinion, notwithstanding the fact that the notices are specific in the manner identified by counsel for the respondents, each notice fails to meet the requirements substantially for the reasons given by counsel. Each notice fails to give any indication of when 24 hour rolling stoppages after the first one will take place, with the result that ABCL does not know from day to day whether it will have to make provision for a stoppage of 24 hours duration.

PN130

That, of course, is exactly my client's position here. Perhaps, not limited to the 24 hour stoppage, but from day to day, it is being subjected to industrial action and it does not know when the next is going to happen. So what we say is that it is apparent that on their face, those notices are invalid but even if they are not, the fact is that the CFMEU is using the subcontractors to enforce their industrial will or impose their industrial will upon Pentroth. Now, there's a couple of problems with that. The first problem is that those contractors have certified agreements which have not expired.

PN131

That is a problem to start with. That cannot give rise to protected action. More importantly, though, if I can refer your Honour to section 170MN of the Workplace Relations Act - - -

PN132

THE SENIOR DEPUTY PRESIDENT: Yes.

PN133

MR MANUEL: - - - 170MN(1) and (2) provides that:

PN134

Both engaging and organising industrial action is not protected if it is organised in concert with one or more persons or organisations that are not protected persons, or is intended to be engaged in other than solely by one or more protected persons.

PN135

If you then look at the definition of "protected persons" in (3), it provides:

PN136

A union, a member of such organisation who is employed by the employer...

PN137

and then there's a couple of others. The fact is that 170MN specifically provides that if you use third parties who are not intended, or are not able to be parties to the agreement that is sought to be reached, then that protected action is not protected action. So insofar as there might be an argument that was ably put before the Commission that you should not make an order because this is protected action, we say that that deals with the matter.

PN138

THE SENIOR DEPUTY PRESIDENT: Well, it addresses that without indicating I've reached a conclusion, I guess. It clearly goes to the question of the action that might be taken by employees of McMahons Services, Vadasz Holding Company, or, indeed, another subcontractor. You will need to address me as to how it goes to the action that might be taken by the one employee of the Pentroth contracts.

PN139

MR MANUEL: Well, the employee of Pentroth is entitled to take protected action but - - -

PN140

THE SENIOR DEPUTY PRESIDENT: Not if I grant the order that you are seeking, Mr Manuel.

PN141

MR MANUEL: No. With respect, if he or the CFMEU on his behalf validly organises a notice, a section 127 order would have to give way to such a valid notice, and it would be open to the Commission to recognise that and quite appropriate, with respect, to recognise that within the 127 order but if you look at 170MN, and we will talk about just engaging for this stage 170MN(1):

PN142

Engaging in industrial action is not protected if it is engaged in concert with one or more persons or organisations that are not protected persons.

PN143

In other words, it is not a partial reduction of protection - - -

PN144

THE SENIOR DEPUTY PRESIDENT: Yes.

PN145

MR MANUEL: - - - it removes protection completely from the action.

PN146

THE SENIOR DEPUTY PRESIDENT: Yes.

PN147

MR MANUEL: So if you bring in the employees of Vadasz, then the employee of Pentroth is unprotected as is the CFMEU for that matter. However, if the CFMEU organise strike action, for instance, by the one employee and none of the other employees of the other contractors were involved, we would say, with respect, that that would be subject to all the other requirements, that that would be valid.

PN148

THE SENIOR DEPUTY PRESIDENT: Yes.

PN149

MR MANUEL: It would be quite proper for your Honour, if you were minded, to recognise that within the order that was made.

PN150

THE SENIOR DEPUTY PRESIDENT: I see. The point I was making is that I'm having a little difficulty reading that distinction into the order that is sought.

PN151

MR MANUEL: Yes. We may have finished our case slightly high on that point. We do recognise - the way we have drafted it is on the recognition that that would almost follow as a matter of course, but if there was some need for specific - - -

PN152

THE SENIOR DEPUTY PRESIDENT: I understand, thank you.

PN153

MR MANUEL: - - - statements. Now, if I could just briefly give you an overview of our position. The work is being regulated by a Federal award, and also by enterprise agreements. Now, they will ebb and flow and change, depending on where in the process we are. Nevertheless, right at the moment, at the very least, you can be satisfied that Vadasz is on site and is covered by a certified agreement, and you can be satisfied from the bargaining period notices issued by the CFMEU that the one employee of Pentroth is also covered, at least by an underpinned Federal award.

PN154

As a consequence, the Commission has jurisdiction at that level. Pentroth has the right to apply. It is directly affected. It is directly affected, obviously, in respect of its own employee but it is directly affected by the industrial action taken by the employees of the contractors. Its ability to run its building site is directly affected, and so again we say that jurisdictional hurdle, or at least the ability to bring the matter before the Commission is satisfied. Now, we must show that industrial action is happening, threatened, impending, or probable.

PN155

Now, right at this instant, I think we have to concede that it is not happening, although I might ask Mr Lindsay if he could step out of the Court and just make some quick inquiries as to the current state of affairs at the building site so that I can be satisfied that that is an accurate statement. Is it threatened? Is it pending or is it probably? We say to all of those that the answer is yes. If all we have had was a threat on Friday that if you don't fix the toilets, you are going to have industrial action, we would respectfully submit that that would not be sufficient.

PN156

However, what we have is an underlying dispute about enterprise bargaining. We have Mr Feehan, who is the person responsible for that and we have Mr ..... regularly attending the site and imposing industrial action via the contractors and also by our individual employee. So what we say is that there is a course of conduct from which you are entitled and should, we say, infer that there is an ongoing threat that it is a pending industrial action and that more than likely, it is probable that there will be further industrial action unless the Commission intervenes.

PN157

THE SENIOR DEPUTY PRESIDENT: Mr Manuel, the claims articulated in (1), in particular in the Notice of Initiation of Bargaining Period - - -

PN158

MR MANUEL: Yes, your Honour?

PN159

THE SENIOR DEPUTY PRESIDENT: - - - can you tell me whether those claims have been further defined and made more specific at all?

PN160

MR MANUEL: No, I couldn't. What I can say from the instructions that I have is that there have been exchanges of documents which I would expect would have refined those claims in some detail. Certainly, I'm sure that Mr Howard could give you an overview of that if it was useful. What I can say, though, is there currently is not an agreement between the CFMEU and Pentroth. There have certainly been negotiations, and there certainly have been exchanges of documentation going backwards and forwards.

PN161

As I understand it from my instructions, that has included the CFMEU putting a document on the table to say this is what we think is right, and then us, Pentroth, making responses as to what we say is right but it has not reached a conclusion.

PN162

THE SENIOR DEPUTY PRESIDENT: You see, what I'm particularly interested in, in that regard, is whether or not the claims that you say the CFMEU are putting on Pentroth are claims that are restricted to Pentroth and its employees, or whether they are claims that extend beyond Pentroth as a discrete employer to other employers.

PN163

MR MANUEL: Insofar - we would say it is the former but there is always a complication with head contractors, particularly if there are such things as site allowances being sought.

PN164

THE SENIOR DEPUTY PRESIDENT: Yes, I had heard of those on occasion.

PN165

MR MANUEL: What we would say is that insofar as there is a hidden or undisclosed agenda to expand the effect of any agreement reached with Pentroth to other employees on site, in other words, contractors, that that is clearly in breach of the Workplace Relations Act - in particular, the no further claims provisions within the Workplace Relations Act and therefore, would not be a proper motive for industrial action or protected action. Insofar as the claims are some - and I shudder to mention the phrase - something like a 36 hour week push, again, it runs into the same floor.

PN166

In other words, even though it might be an attempt to drive something wider in industry, at the end of the day, those sorts of claims still have to meet the test of the Workplace Relations Act in respect of enterprise bargaining. I don't see within this document that there is, in fact, any mention as to a 36 hour week. There certainly is a mention of site productivity allowances related to the value of the work under construction, but as I say, insofar as that is sought to be flowed on to other employees who are contractors on the site or subcontractors on the site, that would be unlawful or, at least, in breach of the Workplace Relations Act.

PN167

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN168

MR MANUEL: We also say that the industrial action - well, as we have also said, the industrial action is for the purpose of enterprise bargaining, but we also say that it is not actually - even if it was unprotected, it is not even legitimate unprotected action. It is - for instance, the ban on the toilet is clearly trying to improperly use a safety issue, although there is no safety issue, for an ulterior purpose. If it wasn't trying to improperly use a safety issue, then the response to non-compliance would be something to do with the safety issue.

PN169

In other words, we will not allow people to go within 5 metres of the toilet or we will require you to allow them to go to an agreed place for that purpose, but instead, the toilet remains but they ban the pylon work. That has nothing to do with the safety issue. It is not an imminent risk and what we say is that it is just a misuse of a safety issue for industrial purposes. I think I've already addressed your Honour on the balance of convenience issue. As I've said, and I'm not trying to take unfair advantage of the absence of the CFMEU, but it is difficult to see what loss they suffer by such an order.

PN170

What they can still do is if they are prepared or wish to, they can still take protected action so long as they meet the requirements of the legislation, so they don't suffer any loss in that regard. They certainly don't suffer any financial loss. The people who suffer the financial loss are Pentroth, the contractors, and just as importantly, the employees who every time the CFMEU says: go home for half a day, are facing the loss of half a day's wages. What we say is that on the basis of what we have put that there is a basis for a 127 application, and there is a basis for making those orders.

PN171

We accept that those orders should be as limited as reasonably practicable but nevertheless, they should be for a reasonable period of time in an attempt to avoid this ongoing death by a thousand cuts approach. Could you excuse me for one moment, your Honour?

PN172

THE SENIOR DEPUTY PRESIDENT: Certainly.

PN173

MR MANUEL: May it please the Commission, those are our submissions.

PN174

THE SENIOR DEPUTY PRESIDENT: Mr Manuel, one other issue. Please don't take offence at the way I phrase it but it has already been a long morning. You sought a section 127 order. You have sought it in an environment where Mr O'Malley has already exited my Court room in some haste, thereby, frankly to me, indicating his view of the Commission, at least as presently constituted. If I were to issue you that section 127 order, and then the order were to be disregarded, I'm wrestling with how the parties would then propose, or how you would propose to work towards trying to resolve the issue.

PN175

The question that is exercising my mind is whether or not there would be any potential benefit associated with a compulsory conference on this matter in order to try to see whether there could be some conclusion to the issue.

PN176

MR MANUEL: You would understand my position is that I try and avoid conciliation. That didn't come out quite the way I intended it.

PN177

THE SENIOR DEPUTY PRESIDENT: Yes. Look, that is where I was priding myself on my diplomacy, Mr Manuel. I was going to suggest that you may not be the ideal person to attend such a conference but - - -

PN178

MR MANUEL: Mr Howard is definitely the expert in that.

PN179

THE SENIOR DEPUTY PRESIDENT: I'm fundamentally asking the question as to the extent to which you are intent on being reliant upon the issuing of a section 127 order, and the potential follow-up actions - - -

PN180

MR MANUEL: Yes, in the Federal Court.

PN181

THE SENIOR DEPUTY PRESIDENT: - - - as the means of resolving the dispute, or whether there is, indeed, a proposition that there would be some form of conference proceeding on the matter?

PN182

MR MANUEL: Well, I think you rightly noted earlier on in the proceedings that both the MBA, via Mr Howard, and the CFMEU are rightly proud of their ability to negotiate resolutions compared to, say, some of the less agreeable States.

PN183

THE SENIOR DEPUTY PRESIDENT: Yes.

PN184

MR MANUEL: I'm sure that remains the same case. My client does not wish to be bogged down in litigation. It wants to build - it has got a hotel complex to build and that is what it wants to do. If there is any prospect of a negotiated settlement, then I have no doubt that it would cooperate fully with the Commission in trying to achieve that. You are quite right that I am not the person to assist in that regard, but Mr Howard is an expert and he also has the full background of the matter.

PN185

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN186

MR MANUEL: May it please the Commission.

PN187

THE SENIOR DEPUTY PRESIDENT: I have indicated to you that I will consider the various material you have provided to me, and would expect that some time tomorrow morning I will have a decision available for the parties.

PN188

MR MANUEL: Thank you, your Honour.

PN189

THE SENIOR DEPUTY PRESIDENT: Thank you.

ADJOURNED ACCORDINGLY [12.40pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #P1 CORRESPONDENCE TO THE DIRECTOR OF PENTROTH CONTRACTS FROM THE CFMEU DATED 20/08/2002 WITH ATTACHED DOCUMENTATION PN118
EXHIBIT #P2 CORRESPONDENCE FROM THE CFMEU TO PENTROTH CONTRACTS DATED 02/10/2002 PN118