C2001/3507, Transcript of Proceedings [2002] AIRCTrans 888 (20 March 2002)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT KAUFMAN

C2001/3507
C2001/3518

COAL MINING INDUSTRY PRODUCTION
AND ENGINEERING CONSOLIDATED AWARD
1997

Application under section 113 of
the Act by the New South Wales
Minerals Council re apprentice rates

SYDNEY

10.09 AM, TUESDAY, 5 MARCH 2002

Continued from 7.12.01

PN157

THE SENIOR DEPUTY PRESIDENT: Good morning, I will take the appearances please in each matter. I think we will hear them together, unless anybody has got a view to the contrary. Yes.

PN158

MS J. GRAY: I appear for the CFMEU, which is the applicant in C2001/3507, and we are also appearing in respect to C2001/3518.

PN159

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN160

MR K. TURNER: I appear on behalf of a number of companies who are members of the New South Wales Minerals Council, and at the previous hearing your Honour asked me to provide a list of the individual companies which I now have, if your Honour pleases.

PN161

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Turner. I will take that list and I will mark it, I think.

EXHIBIT #NSWMC1 LIST OF COMPANIES FOR WHOM MR TURNER APPEARS

PN162

THE SENIOR DEPUTY PRESIDENT: Yes.

PN163

MR G. SMITH: I appear on behalf of Allied Coalfields Proprietary Limited.

PN164

THE SENIOR DEPUTY PRESIDENT: On behalf of, sorry?

PN165

MR SMITH: Allied Coalfields Proprietary Limited. Capricorn Coal Management Proprietary Limited. Dartbrook Coal Proprietary Limited.

PN166

THE SENIOR DEPUTY PRESIDENT: Could you spell that one for me?

PN167

MR SMITH: D-a-r-t-b-r-o-o-k, yes. And Drayton Coal Proprietary Limited, D-r-a-y-t-o-n.

PN168

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN169

MS R. BRADY: I appear for the respondent members of Australian Business Industrial, namely Boral Transport Limited.

PN170

THE SENIOR DEPUTY PRESIDENT: The name, sorry, Boral?

PN171

MS BRADY: Boral Transport Limited.

PN172

THE SENIOR DEPUTY PRESIDENT: Yes. Now, Ms Brady, you need leave to appear. Is anybody else in the same position? No. Is there any opposition to Ms Brady's appearance?

PN173

MR TURNER: No, your Honour.

PN174

THE SENIOR DEPUTY PRESIDENT: Okay. Yes, Ms Brady, leave is granted.

PN175

MS BRADY: Thank you, Commissioner.

PN176

THE SENIOR DEPUTY PRESIDENT: Now, on the last occasion I think the parties were going to have some discussions. Has there - have there been discussions?

PN177

MS GRAY: Yes, there has, your Honour. We as the principal union to the award consulted with our district officials, affected by the New South Wales apprenticeship area. We then met with the New South Wales Minerals Council and also a representative from Anglo Coal and we had previously also consulted with the Trades Unions to have a consensus on the position which we undertook to put to the Minerals Council and Anglo Coal. Our position, your Honour, was that we were prepared to have a conversion of the flat rate amounts of the New South Wales apprentices to the percentage which they represented to the existing trades person rate, once the last safety net review increase was applied to the apprenticeship rates.

PN178

We are also prepared to negotiate further on that area, but the New South Wales Minerals Council, after consultation with the companies which it represents and its members, advised that they rejected the union's proposal and that there wasn't any scope for further negotiations, short of their application which they have before the Commission today so, unfortunately, we were unable to reach common ground, your Honour.

PN179

THE SENIOR DEPUTY PRESIDENT: Yes, thank you. Just before we go on, I have received a letter from the CEPU yesterday, a facsimile, indicating that it opposes the employer's application and has requested the AMWU represent them at today's hearing. I notice there is no appearance for the AMWU.

PN180

MS GRAY: I had actually arranged to meet Mr Terzic from the Metal Workers this morning, prior to us starting, your Honour, and he has not showed or contacted me, so I'm unaware of his reason for not being available to attend, but it had been anticipated that he would represent the Trade Unions and that we would have a common position from the union side of the bar table.

PN181

THE SENIOR DEPUTY PRESIDENT: Yes, well, as he is not here you will have to hold the fort, Ms Gray.

PN182

MS GRAY: I will do my best, your Honour.

PN183

THE SENIOR DEPUTY PRESIDENT: Now, has there been any discussion as to how this morning's proceedings should progress. Who wants to address me first?

PN184

MR TURNER: Yes, thank you, your Honour, there has been some discussions. When we were last before you the companies representing - the companies members of the New South Wales Mineral Council were ready to proceed on that day. At the request of the advocate on behalf of the CFMEU, we did agree to have further meetings. Notwithstanding, the fact that there had been a considerable amount of discussion and a very long history on this matter. Those discussions proved fruitless, so we are here today ready to proceed, however, I believe the advocate on behalf of Boral may wish to address your Honour on this matter.

PN185

THE SENIOR DEPUTY PRESIDENT: Yes. You have the running, do you, Ms Brady?

PN186

MS BRADY: I don't know that I have the running, Senior Deputy President, but I just wanted to indicate, I've spoken with Mr Turner prior to this morning's hearing and he has indicated that they wish to proceed. I don't have instructions to proceed as I was of the understanding that this was a mention and I haven't had involvement in this matter in the past. So I will indicate to the Commission that I don't have instructions. I have corresponded with our client this week and they are considering both positions and that is our current position. I understand that the matter has been going on for some time and I can take that in my stride, so I just put that to the Commission.

PN187

THE SENIOR DEPUTY PRESIDENT: Yes, I think you will have to. It has been going on - there have been two hearings, the first on 16 November last year and the second on 7 December last year, and it was listed for hearing for today. I don't know where you got the impression that it was - well, you got it from me: return for a report back today. Yes.

PN188

MS GRAY: Your Honour, might I just say that we certainly anticipate that the New South Wales Minerals Council will lead off with its submissions, which it intended to make on the last occasion as I understand it. After our negotiations the week before last I did have a discussion with Mr Turner, because I had anticipated that this would hopefully just be a report back with a consent position and if that wasn't the case, that the case may need to be programmed. However, I asked Mr Turner whether they intended to bring evidence? He said that they would be relying on their submissions, so on the basis of that, your Honour, we would like to hear the New South Wales Minerals Council, but we would be reserving our position to ask for an adjournment if, in fact, there is something more substantial than what we have been advised will be forthcoming today.

PN189

THE SENIOR DEPUTY PRESIDENT: Yes. Well, Mr Turner, are you ready to proceed with your submissions?

PN190

MR TURNER: Yes, I am, your Honour.

PN191

THE SENIOR DEPUTY PRESIDENT: Well, go ahead.

PN192

MR TURNER: Your Honour, I would just like to hand up a summary of the outline that I will present this morning.

PN193

THE SENIOR DEPUTY PRESIDENT: Yes, I will mark your outline of submissions.

EXHIBIT #NSWMC2 MR TURNER'S OUTLINE OF SUBMISSIONS

PN194

THE SENIOR DEPUTY PRESIDENT: Perhaps you might just give me a moment while I read through it. Yes, thank you Mr Turner, go ahead.

PN195

MR TURNER: Thank you, your Honour. In relation to this morning's proceedings there are essentially two elements which have been identified as separate matters. The first one is the fixing of the rates themselves and the second element is the way in which the apprentice rates are identified within the award. Just to make things a little easier, I would like to hand up a copy of the relevant clause which has already been identified by way of the earlier application and this is clause 13 of the Production and Engineering Award.

PN196

THE SENIOR DEPUTY PRESIDENT: Yes. I won't mark that as an exhibit.

PN197

MR TURNER: The second page of the hand-up is outlined the clause 13.4 which is the Queensland apprentices and apprentices other than adult apprentices at 13.4.2 are outlined in the percentages as detailed and also adult apprentices are similarly marked. Clause 13.5 deals with New South Wales apprentices and in relation to apprentices other than adult apprentices clause 13.5.2 outlines the whole dollar amounts which identify the relevant rates for 1st, 2nd, 3rd and 4th year apprentices.

PN198

On the next page of the hand-up and still in clause 13.5.2 is the outline of the New South Wales adult apprentices and it is worthy to note that the apprentices in - as outlined there, are in fact percentages. So the only group, if you like, within the award that are whole dollar amounts are the apprentices other than adult apprentices. When this matter came before the Full Bench by way of an appeal on the simplification of the Production and Engineering Award itself, there were a considerable number of lengthy hearings and also a conciliation process that was very involved and lengthy.

PN199

The conciliation process was primarily called to deal with the issue of the rates within the award and also the classification structure within the award. The reason that I am explaining this part of the background because it goes to the heart of why we are actually here today. The classification structure in the award at that time was a very complex classification structure known as the work model and the wages structure associated with that classification structure were equally complex.

PN200

The companies put a proposal forward which would lead to a greater simplification of both the classification structure and the wages structure and indeed the model put forward by the companies reflected to a greater degree what was actually occurring, in the main, within most of the mine sites in New South Wales and certainly in Queensland. Now, it is fair to say that all parties to the award put in enormous effort and produced copious documents and counter proposals in relation to this matter.

PN201

During this part of the process the companies raised the issue of the apprentice whole dollar amounts within New South Wales and the view that we put forward was that this should be a percentage amount not a whole dollar amount because of the problems it was causing in terms of the relativities. At that time and given the circumstances the Full Bench in its decision decided not to deal with that particular matter and I would like to hand up a copy of a part of the decision itself. The part that I wanted to refer to your Honour is at the top of the page and it is page 11 of 32 pages of the decision.

PN202

THE SENIOR DEPUTY PRESIDENT: That is an internet print, yes.

PN203

MR TURNER: Sorry, your Honour?

PN204

THE SENIOR DEPUTY PRESIDENT: That is an internet print that you are handing up. I'm just identifying the pages, not the official Commission print, that is all, but go ahead.

PN205

MR TURNER: Yes, it is a print off the internet.

PN206

MS GRAY: I think - sorry to interrupt my friend, but I think I handed up a correct print of T2270 back in November to your Honour.

PN207

THE SENIOR DEPUTY PRESIDENT: Yes, you also handed up an internet print, that is right. I'm just trying to identify what paragraph number you have handed up, Mr Turner. Where are you reading from?

PN208

MR SMITH: If the Commission pleases, it is paragraphs I think commencing 42 or 43 and certainly the dot point that on the page that Mr Turner has handed up that commences: The employers submitted that the existing rates of pay, etcetera, is - - -

PN209

THE SENIOR DEPUTY PRESIDENT: It is not immediately apparent to me, either.

PN210

MR SMITH: I will in a moment, your Honour. No, it is actually 47.

PN211

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Turner, I'm going to look at the actual print rather than the extract that you are handing up. It is not very helpful, with respect, to hand up a document that does not even have the right paragraph numbers on it.

PN212

MR TURNER: I'm sorry, your Honour.

PN213

THE SENIOR DEPUTY PRESIDENT: I'm looking at the print at paragraph 47 where it says:

PN214

The employers submitted that the existing rates of pay in the award are not properly fixed minimum rates.

PN215

Is that what you wanted to take me to?

PN216

MR TURNER: Yes, your Honour, I just simply wanted to state that the Full Bench simply said that there was a recognition of a disparity had arisen in the rates for the apprentices but were unable on the limited submissions and material presented to make a final judgment and then stated that, if necessary, a separate application for consideration by the Commission would be required. The only reason I bring that that point to your Honour's attention is because at first sight it would seem odd that we are actually here today talking about the apprentices rates being unreviewed.

PN217

THE SENIOR DEPUTY PRESIDENT: Well, Mr Turner, can I take you to paragraphs 43 and 44 of the decision they seem to me to be more apposite to this particular issue? I think what you say is essentially the same, the Commission - the Full Bench concluded:

PN218

In these circumstances we consider that the matter should be the subject of further discussion and negotiation between the parties and if necessary a separate application for consideration by the Commission.

PN219

That is at the end of paragraph 44.

PN220

MR TURNER: Yes, your Honour.

PN221

THE SENIOR DEPUTY PRESIDENT: And that is dealing with apprentice rates not - - -

PN222

MR TURNER: Yes.

PN223

THE SENIOR DEPUTY PRESIDENT: Yes, I've read those passages, thank you.

PN224

MR TURNER: And that was just simply the point, your Honour, that the Commission stated that there were limited materials put forward and the background context to that also was that there was some uncertainty in relation to the application of how the rates would be reviewed in any case. So there was an evolution, if you like, of understanding of how these matters would proceed. So it is just simply that it slipped through the net, it wasn't dealt with properly and the Commission recognised that at the time.

PN225

So our simple - it is not a lengthy submission, our simple proposition is that the apprentice rates themselves as they currently stand are not properly fixed minimum rates and that they need to be reviewed in light of the principles themselves and as a separate matter we then would ask and seek that the question of how the rates themselves are shown in the award be considered, and I don't wish to labour that point any further, your Honour. With regard to the anomaly that is currently in the award itself there has been a long history of discussion on this matter and I have got a summary of the decisions of the Commission. It is not official print but it is a list of decisions that have been handed down by the Commission and it simply shows the way in which the apprentice rates have been dealt with.

EXHIBIT #NSWMC3 TABLE OF DECISIONS

PN226

MR TURNER: Now, there is nothing startling in any of the matters that are within the table. However on page - - -

PN227

THE SENIOR DEPUTY PRESIDENT: Are these decisions of some of the - are they all of the Coal Industry Tribunal are they?

PN228

MR TURNER: Some are the Coal Industry Tribunal and then from 1995 from the Australian Industrial Relations Commission.

PN229

THE SENIOR DEPUTY PRESIDENT: Yes.

PN230

MR TURNER: The only unusual aspect in any of these decisions is on page 3 of the document and it is the decision of 1996, 10 July 1996 where the apprentice rates were actually increased by a percentage of the amount that was used to move the adult rates. Now, at that time there had been discussion once again between the parties on the anomaly that wasn't resolved. That discussion wasn't resolved and in 1996 we had this decision which is unusual. From 1997 the non-adult apprentice rates are then varied in the way in which they were always varied.

PN231

So I simply highlight to your Honour that this matter has got a long history, has been a matter of lengthy discussion between the parties and on one occasion at least it was recognised that the rates be varied by a percentage amount.

PN232

THE SENIOR DEPUTY PRESIDENT: Now, you are not asking me to go to those decisions and read them and try to understand them I take it?

PN233

MR TURNER: No, your Honour. I actually researched those decisions. They are notably lacking by explanation and content as to why on that occasion it was moved by a percentage amount and why it then reverted back to another one, save to state that it simply illustrates that the parties have been discussing this issue and it has been recognised as an issue and on one occasion the Commission chose to vary it by way of percentage and then from the next occasion onwards didn't.

PN234

THE SENIOR DEPUTY PRESIDENT: Did the employers seek in any of those cases to have the way in which apprentice rates in New South Wales were paid changed to reflect Queensland or some other formula?

PN235

MR TURNER: From recent times there has been a recognition that the simplification of the Production and Engineering Award itself would require at least an examination of the rates. So the submissions being put forward in recent years have simply been to state that there is an anomaly, that the employers are concerned about the effect of the anomaly on relativities and that we reserved our right to bring this matter up at another time. So that has been the approach that has been adopted in recent years, your Honour.

PN236

It is also useful in relation to the question of the anomaly to look at a comparison of old apprentice rates versus metalliferous mining rates and metals industries rates and I've got a table of comparison that I would also like to hand up.

EXHIBIT #NSWMC4 COMPARISON OF RATES

PN237

MR TURNER: The purpose of handing up this document, your Honour, is just simply to demonstrate two things, firstly that apprentice rates generally in the general sense are moved as a percentage of the tradesperson's rate in all occasions except in the production and engineering non-adult apprentice rate and also that the current rates in the production and engineering award by comparison are significantly in advance of those in a similar award which is the Metalliferous Mining Award and certainly in the Metals and Engineering Award.

PN238

THE SENIOR DEPUTY PRESIDENT: Yes. How many people are we talking about in New South Wales, Mr Turner?

PN239

MR TURNER: In New South Wales there are approximately, there are under 50 apprentices. Now, not all of those apprentices are employees of the companies themselves. Certainly the Power Coal Group of Companies employ apprentices from year 1. The majority of other apprentices in the New South Wales industry are engaged through training providers for at least their first and second year and then are often engaged by the company in their third and fourth year. Generally that is the end of the tenure unless there are particular vacancies available.

PN240

THE SENIOR DEPUTY PRESIDENT: Do you say anything as to whether or not these rates are a disincentive to the engagement of apprentices?

PN241

MR TURNER: That has been one of the issues that we have raised with the unions that particularly the first and second year rates because they are so high that that does provide a disincentive. One of the other issues that has been put to us is that companies will obtain or want their apprentices to be experienced in outside industries which is why they may not be retained in the first year or two and that is certainly the case. We don't deny that. The companies that I represent however, your Honour, do state that it can provide a disincentive and that is why - - -

PN242

THE SENIOR DEPUTY PRESIDENT: Is there any evidence to support that other than your assertion?

PN243

MR TURNER: There isn't, your Honour, no. So as I indicated the purpose of this table was simply to outline the fact that most apprentices are progressed by way of a percentage and certainly the rates of apprentices in the coal industry are generous compared to those of other awards. In relation to this matter and how it should be dealt with it is our view that the rate should be expressed as a percentage of mine worker induction level 2 and that has generally been known as the tradesperson's rate within the award.

PN244

Now, if this was to be the case obviously there are apprentices currently engaged who are on the rates of pay in the award as currently outlined and we would not propose that they suffer any loss of wages, that they would maintain their current rate by way of a savings provision similar to that or a transition period if you like similar to that which was inserted in the award which was clause 18.7 and I have a copy of that provision.

PN245

THE SENIOR DEPUTY PRESIDENT: I have the award, Mr Turner.

PN246

MR TURNER: Clause 18.7 of the award simply states that as a result of the insertion of a new classification structure and rate structure that no person would be disadvantaged by that process and we would just simply state that it is our position that that process could apply with apprentices currently engaged in the industry and that moving forward, apprentices would be engaged by way of a percentage of the level 2 rate. So in summary, we simply say that the apprentice rates need to be reviewed. They weren't reviewed when the main award rates were reviewed, we simply say that that was an oversight and we also seek - - -

PN247

THE SENIOR DEPUTY PRESIDENT: Well, it wasn't an oversight. It was specifically not dealt with. It was sought to be raised and the Full Bench said it wasn't an appropriate time to deal with it but that is not to say that it was an oversight.

PN248

MR TURNER: Yes, thank you, your Honour.

PN249

THE SENIOR DEPUTY PRESIDENT: While I've got you interrupted, I tried to find this but couldn't. There was a submission made on behalf of the employers in the Full Bench case, it was exhibit QMC39. I would appreciate a copy from somewhere. The Commission's records - - -

PN250

MS GRAY: I intended to tender that.

PN251

THE SENIOR DEPUTY PRESIDENT: Good, because I couldn't find it in the Commission's records I have to confess. So it is not an oversight. I was sought to be dealt with, Mr Turner, and you are dealing with it now.

PN252

MR TURNER: Thank you, your Honour. Your Honour, there was also a case which we don't rely on but it is simply a matter of an illustration of how a similar matter was dealt with. It is a case of the New South Wales Industrial Relations Commission.

PN253

THE SENIOR DEPUTY PRESIDENT: Thank you. Yes, I won't mark that. You have handed up to me a copy of re Australian Wire Industries Proprietary Limited Newcastle Wire and All General Award and others, it is decision of the Full Bench of the Industrial Commission of New South Wales reported at (1998) 26 IR page 81. Yes, do you want to take me to any passage in that, Mr Turner?

PN254

MR TURNER: Just in terms of illustration of the points at hand, on page 84 of that decision on the bottom paragraph, the decision simply was that it was appropriate that percentages be applied and not whole dollar amounts but then on page 85, also on the bottom part of the paragraph there's a quotation which whilst is an old quotation, it is a National Wage Case decision of August 1988, it is useful in terms of simply stating that the reason apprentices are applied percentages and increases that primarily of the perceived need to preserve existing relativities.

PN255

So as I say, your Honour, we don't rely on the case, we just simply state that it is useful in terms of what we say is a common sense approach to the problem in hand. Your Honour, I would like to hand up a draft order.

EXHIBIT #NSWMC5 DRAFT ORDER

PN256

MR TURNER: Now, we would just submit that possibly the simplest way of dealing with this matter from our point of view is just to vary the award by removing the whole dollar amounts and simply inserting the percentage amounts shown and they are the same percentage amounts that are shown within the award that apply to the Queensland non adult apprentices.

PN257

THE SENIOR DEPUTY PRESIDENT: Yes, and that is the order sought by your application for variation?

PN258

MR TURNER: That is correct, your Honour. With regard to apprentices currently, we simply say that it is our view that they shouldn't be disadvantaged, they would be simply marked as present occupants only within their current rates of pay and until they moved up to a higher rate of pay which was in advance of their current classification rate of pay.

PN259

THE SENIOR DEPUTY PRESIDENT: How is it that you say that by doing that, that would properly fix minimum rates for apprentices in New South Wales?

PN260

MR TURNER: Well, going forward any amounts that were to vary within the award itself, the total rate would be the reference rate applying to the apprentices. So that when the total rate in the supplementary column within the current award is subsumed and the total rate starts to move, then the apprentice rates would move in tandem and thereby keeping the existing relativity.

PN261

THE SENIOR DEPUTY PRESIDENT: Yes. Implicit in your submission is a notice that the rates for apprentices, other than adult apprentices, in Queensland are properly fixed minimum rates for apprentices, that those are the appropriate percentages but how do I know that?

PN262

MR TURNER: It is our submission, your Honour, that that is how they are fixed in Queensland and that is an appropriate guidance.

PN263

THE SENIOR DEPUTY PRESIDENT: Ms Gray will say the way they are fixed in Queensland is not an appropriate way to fix them. Where does that get me?

PN264

MR TURNER: I appreciate that, your Honour. We are just simply saying in terms of relativities that these are reasonable percentage differentials.

PN265

THE SENIOR DEPUTY PRESIDENT: I understand what you are saying. What I don't understand is why you are saying it because you have not provided me with any evidence or data to support your submission. I would have thought that I would be assisted by that, Mr Turner. Do you intend to do that?

PN266

MR TURNER: I'm not quite sure I understand your Honour's question.

PN267

THE SENIOR DEPUTY PRESIDENT: Well, just proceed and I will save my questions until the end of your submission.

PN268

MR TURNER: It is our submission, your Honour, that the rates as they are currently constructed within the award are creating anomaly and that those rates if left untended or unchanged will eventually lead to a situation where apprentice rates will continue to move by way of application such as the one currently sought and that in the foreseeable future the - certainly the fourth year rate will approach the rate of the trades-person itself and we simply say that that erodes the relativity and it is our view that the relativities are needed in terms of identifying appropriate skills, identifying appropriate experience and identifying appropriate responsibilities that occur within the different levels of apprenticeship prior to a person becoming a full trades person. Those rates relative to those skills, experience and responsibilities have historically have had relativities.

PN269

THE SENIOR DEPUTY PRESIDENT: Yes. Well, I can't help myself, Mr Turner, but isn't that what you need to lead some evidence on to show that the rates you propose are appropriate relativities given what the apprentices in the various years do in relation to skills, responsibilities and so on compared with tradesmen? Isn't that what you need to do if you say there's an anomaly, to show me that those are the appropriate percentage rates. Don't you need to lead some evidence to support that?

PN270

MR TURNER: Your Honour, I haven't brought that evidence here today.

PN271

THE SENIOR DEPUTY PRESIDENT: I understand that.

PN272

MR TURNER: And that concludes my submission.

PN273

THE SENIOR DEPUTY PRESIDENT: Yes. Anybody else for ..... please?

PN274

MR SMITH: Yes, thank you, your Honour, I will be relatively brief. First of all I would say that, on behalf of the companies that I represent, we support the application and submit that the award should be varied in the manner sought and, accordingly, we concur with the submissions that have been made by Mr Turner. There are a couple of matters that I just wanted to expand on briefly, and in order to do that I want to hand up a couple of exhibits. These documents - - -

PN275

THE SENIOR DEPUTY PRESIDENT: Do you want them marked as one exhibit or separately, are they different?

PN276

MR SMITH: They can be marked as one exhibit.

PN277

THE SENIOR DEPUTY PRESIDENT: Yes, well, the documents - which one should I look at first?

PN278

MR SMITH: Perhaps if we do mark them as separate ones, your Honour, the one with the yellow and pink is the first one.

PN279

THE SENIOR DEPUTY PRESIDENT: Yes, well, I will mark the document that has a comparison of minimum rates with apprentice rates in New South Wales as exhibit S1.

EXHIBIT #S1 DOCUMENT MARKING MINIMUM RATES' COMPARISON

PN280

THE SENIOR DEPUTY PRESIDENT: The second document, that is headed: Coal Mining Industry Production and Engineering Consolidated Award 1997, as exhibit S2.

EXHIBIT #S2 DOCUMENT RE AWARD

PN281

MR SMITH: Thank you, your Honour. These exhibits go to the issue that, we submit, is the key point in relation to this application and also the question that your Honour has just made of Mr Turner in relation to the anomaly. Our position, your Honour, is that the rates in Queensland are probably fixed at minimum rates and that that issue was addressed as part of the Full Bench decision, T2270, in that the paragraphs that we have already referenced were about removing the anomaly that exists in New South Wales, as opposed to the rates that have already been set as minimum percentages of the adult rates in Queensland.

PN282

The Bench concluded, not that the rates in Queensland were not properly fixed minimum rates, but that it did not have enough material before it to determine that it should, at that point, remove the anomaly. As a result of that we have made this application and submit to you that that anomaly, on the basis of the submissions that have been put to you today, should in fact be removed. If I can just take you to exhibit S1, your Honour, and just briefly by way of explanation, the first column simply details the rate following the award simplification, then the safety net adjustment, that your Honour dealt with late last year in relation to this award.

PN283

Then, safety net adjustment 2002 through to 2006 are fabricated figures, they are ones that I've used for the purposes of illustration in this exhibit. The column headed: 18.6 minimum rates, details the minimum rate and the residual component and the total payment for the mine worker induction level 2/training which is the relevant rate in this award for the purposes of calculating the percentage for apprenticeship rates and you can see as you move through to the point where finally the residual component is fully subsumed by the application of those assumed safety net increases and finally we end up with an award rate of $584. The column headed: 13.5, apprentices New South Wales only, details what would happen if the increases as a result of those assumed safety net adjustments were applied to the New South Wales' apprenticeship rates in the manner that was put to you in the safety net adjustment proceedings by the unions back in November and December of last year.

PN284

You can see, your Honour, that the current percentages as they are set out now, and bear in mind those percentages are not in the award. They are calculations as a result of the total rates that appear in the award, are currently 61 per cent, 69.3 per cent, 81.8 per cent and 90 per cent. Skipping all the interim columns and moving to the final one through the application - sorry, rows rather - and skipping to the bottom row in relation to the application of safety net adjustments in the manner that I have detailed in this exhibit, you can see that those percentages fundamentally change to the first year apprentice receiving 74.2 per cent of the tradesman's rate, second year apprentice, 82.9, the third year, 96.1, and lo and behold, the fourth year apprentice is actually paid more than the tradesman.

PN285

So we would submit, your Honour, the consequence of not addressing this issue is a result that is absolutely ludicrous. It would end up with a situation where an apprentice was potentially paid more than the tradesman who is in a position of providing the training and counselling necessary for apprentices to actually complete their trade. Just before I leave exhibit S1, that contrasts quite starkly, your Honour, in relation to the situation in Queensland within the same award where the rates are expressed as a percentages of the adult rate and therefore move in keeping with 18.6 on that exhibit and are simply expressed as a percentage of the total rate so that, at all times, the apprenticeship rates in Queensland are consistent with the total payments, including the residual payment which would ultimately be extinguished when the residual component is consumed.

PN286

THE SENIOR DEPUTY PRESIDENT: For how long has there been the minimum rate and the residual component? When did that first find its way into the award?

PN287

MR SMITH: The residual component - - -

PN288

THE SENIOR DEPUTY PRESIDENT: Yes.

PN289

MR SMITH: - - - came as a result of the award simplification process.

PN290

THE SENIOR DEPUTY PRESIDENT: Prior to that there was just a single rate, was there - - -

PN291

MR SMITH: Correct.

PN292

THE SENIOR DEPUTY PRESIDENT: - - - in the old award.

PN293

MR SMITH: Yes, and the classification structure that you now see in the award was not in existence either except for the - certainly, the identifiable rate of the mine worker, level 2.

PN294

THE SENIOR DEPUTY PRESIDENT: Yes. Prior to that there existed a complicated scenario that Mr Turner told me about.

PN295

MR SMITH: Yes, that is correct, your Honour, and they were expressed as total rates. If I can move to exhibit S2, and I'm sorry that this appears to be quite complicated and messy but I will try and simplify it.

PN296

THE SENIOR DEPUTY PRESIDENT: So far I've been following it, so - - -

PN297

MR SMITH: Okay. Thank you, your Honour. What I've done here is expressed from the Coal Mining Industry Production and Engineering Consolidated Award (1987), the classification table contained in 18.6, and then, in 13.4, the apprentice rates for Queensland, both non adult and adult and of course, the percentages are shown in respect of Queensland and so I have added the dollar amounts for yours truly purposes - - -

PN298

THE SENIOR DEPUTY PRESIDENT: Yes.

PN299

MR SMITH: - - - and clause 13.5, where I've done the same thing, except for apprentices other adult apprentices, I've added percentages because the total rates are expressed in the award.

PN300

THE SENIOR DEPUTY PRESIDENT: Yes, and they are the current rates, are they?

PN301

MR SMITH: They are the current rates as they currently appear in the award without alteration.

PN302

THE SENIOR DEPUTY PRESIDENT: Yes, waiting for me to vary them, yes.

PN303

MR SMITH: Yes, indeed, and on my submission - - -

PN304

THE SENIOR DEPUTY PRESIDENT: - - - or not, yes.

PN305

MR SMITH: - - - remove them and replace them with percentages, your Honour. The second part of that exhibit, under the heading: Metal Engineering and Associated Industries Award, and I might just for simplification refer to that as the Metal Industry Award, if I may.

PN306

THE SENIOR DEPUTY PRESIDENT: I think most of us still do.

PN307

MR SMITH: Yes. I've again included the rates of pay for adult employees from C14 through to C1B and also the rates of pay for non-adult apprentices and - sorry the percentages, and the total weekly rates for non-adult apprentices and adult apprentices. You can see from that exhibit, the two classifications highlighted in black with the white writing, your Honour, for the mine worker induction, level 2 and the level C10, in the Metal Industry Award. Both express a rate of $507.20, which is the rate used across the awards of the Commission as the base trades rate if I can term that.

PN308

We can see the residual component that applies in relation to the coal mining industry award because it is currently above the minimum rate generally described for tradesmen throughout the Commission's awards and in particular the Metal Industry Award. The anomaly that we say exists, your Honour, is in respect of the New South Wales' situation. You can see the percentages for both non-adult apprentices and adult apprentices in Queensland and New South Wales in comparison with those expressed in the Metal Industry Award are relatively similar.

PN309

THE SENIOR DEPUTY PRESIDENT: Although higher than the Mining Award.

PN310

MR SMITH: The percentages are all higher in the Mining Award.

PN311

THE SENIOR DEPUTY PRESIDENT: Yes, and how is that consistent with your submission that there are properly fixed minimum rates for apprentices? Did the Full Bench take that into account when it was dealing with the Queensland rate?

PN312

MR SMITH: Not to my knowledge, your Honour, there was no specific comparison with the Metal Industry Award in that case.

PN313

THE SENIOR DEPUTY PRESIDENT: So there was no evidence or submissions to say that apprentices in the mining industry have a higher level of skill or responsibility that in the metal industry and therefore should be set at a higher percentage rate?

PN314

MR SMITH: No, there was no evidence of that nature. The view of the employers, or at least the ones that I represent and we were also represented in relation to the Full Bench matter that you are referring to was that the percentages are, in our view, so similar that it wasn't so much an issue that we really wanted to align them necessarily, line by line with what exists in the Metal Industry award. You can see that the differentials are at a maximum of 5 per cent in relation to year 2 and something less than that in relation to - as low as 2 per cent, in relation to the fourth year apprentice. The parts highlighted in blue are for adult apprentices and you can see that in Queensland they are the same as they are in New South Wales and there is some similarity, albeit that the Metal Industry Award uses a 4 year structure for adult apprentices whereas the current subject award includes only a 3 year apprenticeship term. But again, the rates are somewhat similar, albeit, higher in the coal mining industry.

PN315

THE SENIOR DEPUTY PRESIDENT: And there is a faster progression for the 3 years, yes.

PN316

MR SMITH: Yes, yes. The issue comes again, and I don't need to harp on the point but when one looks at the percentages that are in that red circle in relation to New South Wales - - -

PN317

THE SENIOR DEPUTY PRESIDENT: Yes.

PN318

MR SMITH: - - - where clearly they are out of step, in our view, with both what is happening in the award in Queensland and one of the Commission's benchmark awards, if I can use that term, in relation to the Metal Industry Award. That, coupled with the impact of not addressing the issue over time, meaning that that situation will get worse to the point where the fourth year apprentice will in fact be paid, in fact, yes, the fourth year apprentice will in fact be paid more than a tradesman in the coal mining industry. Your Honour, on that basis we would submit to you that the application has merit.

PN319

We have addressed the grounds on which the application have made in relation to the anomalous situation, we would submit that the rates of pay that currently exist for New South Wales' apprentices, non-adult apprentices, were not set as properly fixed minimum rates as part of the award simplification process in respect of this award but that the variations sought would be short if the rates were properly fixed in accordance with the Commission's wage fixation principles and it would correct the current anomalous situation which, left uncorrected would create an absurdity. Finally, of course, based on the submissions that Mr Turner has already made to you, it will not impose any dilution of the rates of pay for employees who are currently engaged under the award as apprentices in New South Wales. For those reasons, your Honour, we would submit that the application should be granted.

PN320

THE SENIOR DEPUTY PRESIDENT: Thank you for your lack of warning.

PN321

MS BRADY: Your Honour, yes I just heard earlier today that I don't have instructions to proceed today. However, I do understand the position presented by the New South Wales' Minerals Council and by my colleague, Mr Smith, and it may very well be that after hearing Ms Gray's position I can perhaps seek to have an adjournment to seek instructions, if you consider that is appropriate.

PN322

THE SENIOR DEPUTY PRESIDENT: Yes, does your client operate in New South Wales - - -

PN323

MS BRADY: That is correct.

PN324

THE SENIOR DEPUTY PRESIDENT: - - - or Queensland, or both.

PN325

MS BRADY: New South Wales.

PN326

THE SENIOR DEPUTY PRESIDENT: New South Wales, yes, thank you.

PN327

MS BRADY: Yes. Thank you, your Honour.

PN328

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Turner, do I need to know anything about the history of the fixation of the apprentice rates in New South Wales? Why they have been fixed in the manner they have over that period of time?

PN329

MR TURNER: Yes, thank you, your Honour. That is a question that I have researched amongst records contained within the Minerals Council when it was formally the Coal Association, by discussions with union officials that were within the industry at the time, both in Queensland and New South Wales, and there is a cloud of uncertainty other than the assertion has been made for whatever reason, it was actually the New South Wales Companies at that time but I have not been able - - -

PN330

THE SENIOR DEPUTY PRESIDENT: Was it a consent arrangement originally, or - - -

PN331

MR TURNER: Correct, yes. There was disagreement between - it was my understanding that there was disagreement amongst the employers in both Queensland and New South Wales as to how this matter should arise and that it was at the employer's instigation that ..... amounts were inserted. That is my understanding, your Honour.

PN332

THE SENIOR DEPUTY PRESIDENT: And as far as your researches indicate there are no decisions of the Coal Industry Tribunal or - was it ever dealt with by the New South Wales' Commission - - -

PN333

MR TURNER: Yes, it is my understanding by the research that I've undertaken that it was a consent matter, that originally - - -

PN334

THE SENIOR DEPUTY PRESIDENT: In the Coal Industry Tribunal?

PN335

MR TURNER: Pardon?

PN336

THE SENIOR DEPUTY PRESIDENT: In which Tribunal?

PN337

MR TURNER: In the Coal Industry Tribunal, that originally that the union thought that they should be both the same but for whatever reason New South Wales group of companies altered the whole dollar amount.

PN338

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, thank you, Mr Turner. Ms Gray, what is your position?

PN339

MS GRAY: Thank you, your Honour. Your Honour, in terms of the union's application to have the safety net review of wages decision of May 2000 applied to the award in totality and we are aware that the aspect of, the issue of the claim which pertains to New South Wales' apprentices has been stood aside whilst this matter is being argued but we would, as our principal submission, rely on those submissions that we made on 16 November 2001 to the Commission and the authorities referred to in that submission to submit that there is no good basis upon which the Commission should withhold the increase to the New South Wales' apprentices even on the basis if it was found that they were not properly fixed minimum rates, then the silver chain authority to which I referred your Honour on the last occasion states by Full Bench that that is no impediment to having the increases flow.

PN340

However, that is our hard and fast initial position, your Honour. Should a satisfactory resolution of what we all recognise is a difficulty that has arisen with New South Wales' apprentices be reached in C2001/3518, then the union would be prepared to withdraw that part of its application which related to the last safety net increase for New South Wales apprentices, so as that situation as it worsened and to effect, should it please the Commission, a conversion of the flat rate amount or percentage to at least have that New South Wales apprentice situation put on hold whilst the tradesman rate to which it is related continues to be, in effect, frozen over the foreseeable future.

PN341

In terms of the employers' application, your Honour, we say that it is essentially the same as that which has been made during the item 51 review by the Full Bench, which is an attempt by the New South Wales Minerals Council and the employer parties to equalise the New South Wales and Queensland apprentice rates. If there is an anomaly in the New South wales apprentice rates, your Honour, in the award we submit it is because the employers' application in this respect during the item 51 review process, including the item 51, paragraph 4, process and the principles in the paid rates review decision was in fact misconceived. What the employers sought then is what they are seeking now, is to equalise the New South Wales and Queensland rates, rather than to convert the New South Wales apprentice rates to properly fixed minimum.

PN342

THE SENIOR DEPUTY PRESIDENT: Well, aren't you at risk that if I look at the Metal Industry Award and apply the rates there as properly fixed minimum that we will end up with a position where the New South Wales apprentice rates are less in percentage terms than the Queensland apprentice rates?

PN343

MS GRAY: Yes, we say - we would say, your Honour, that the Commission is not in a position on the material that has been provided by the employers in support of their application to establish what the properly fixed minimum rates for New South Wales apprentices should be. We would be prepared to consent to a variation of the award which, in effect, puts the position in a holding - the rates on a holding position by a conversion to percentages, which means that they would not increase with safety net increases until such time as the residual component in the tradesmen rate has been fully absorbed.

PN344

We say that this is an argument for - that the metal industry rates should not be applied to the coal industry without a complete examination, your Honour, of the history of the apprentices rates in the coal mining industry throughout their inception and against a background of different apprentices schemes in the two States, and between the coal mining industry and other industries. We simply say, your Honour, that there isn't sufficient material for the Commission to say exactly what properly fixed minimum rates for New South Wales apprentices would be in the coal mining industry and we would seek that the Commission not move to vary the award to put in place something which may well have further unintended consequences in terms of not properly addressing the rates in the industry and against the award history, in which they have been made.

PN345

THE SENIOR DEPUTY PRESIDENT: Yes, well, who is going to enlighten me as to these things, that is the question I put to Mr Turner. There is substance in what you say. I'm attracted to Mr Smith's submission that the Full Bench in fixing the apprentice rates in Queensland had regard to, whether they are properly fixed or not, but then on closer questioning it appears that the Full Bench may not have had regard to that.

PN346

MS GRAY: They don't appear to have at all had regard to that, your Honour, with respect on my reading of the transcript of that particular matter before the Full Bench.

PN347

THE SENIOR DEPUTY PRESIDENT: Yes, I have had a quick look at it too.

PN348

MS GRAY: The Full Bench was in a position of not being assisted by submissions directed to this point. Those in Queensland - - -

PN349

THE SENIOR DEPUTY PRESIDENT: Yes, could I see that submission that I have been searching for and haven't been able to find? That may assist me.

PN350

MS GRAY: Your Honour, I have an extract which has all of the references from that case, because it is enormous, that are relevant to apprentices and I'm quite happy to - - -

PN351

THE SENIOR DEPUTY PRESIDENT: I think you and I did the same exercise last week, Ms Gray, I have tried to do the same thing.

PN352

MS GRAY: Your Honour, while I'm handing that up, I might save your associate a walk by handing up a copy of the supplementary submission of the employers, which became QMC39 in that matter as well.

PN353

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. I thought from the transcript QMC39 was one page, obviously not.

PN354

MS GRAY: It has draft orders attached at the back, your Honour, which is most of the bulk of it - amended draft orders - - -

PN355

THE SENIOR DEPUTY PRESIDENT: Yes.

PN356

MS GRAY: It is actually only two pages - a page and a bit of submission.

PN357

THE SENIOR DEPUTY PRESIDENT: Yes.

EXHIBIT #CFMEU2 SUPPLEMENTARY SUBMISSIONS OF THE APPELLANT EMPLOYERS PROPOSED CLASSIFICATION STRUCTURE AND WAGE RATES THAT WAS BEFORE THE FULL BENCH IN THE AWARD CERTIFICATION APPEAL

EXHIBIT #CFMEU3 EXTRACTS FROM THE TRANSCRIPTS OF PROCEEDINGS

PN358

MS GRAY: The purpose of these exhibits from the union's perspective, your Honour, is to demonstrate that both in the written submission and the oral submissions, that the employers were, in substance, seeking from the Full Bench in the simplification process and minimum rates adjustment, the same thing which they are seeking today, which is not properly fixed minimum rates for New South Wales apprentices but, rather, a correction of what they perceive was a historical anomaly whereby the New South Wales apprentices were on higher rates than the Queensland apprentices and an equalisation of that situation down, rather than up, of course.

PN359

As your Honour would see from the Extract Of Transcript in CFMEU3, there was no further assistance. Mr Martin was representing all of the employer respondents to the award in these submissions. There was no further detail, or history, or certainly no evidence presented on that occasion, which then led to the Full Bench making reference to the fact that there were limited submissions and material presented and insufficient to make a judgment as to whether and in what way the disparity between Queensland and New South Wales apprenticeship rates should be removed.

PN360

THE SENIOR DEPUTY PRESIDENT: Yes, and your point is that so far before me there has been no evidence and the submissions have really gone no further than they did before the Full Bench?

PN361

MS GRAY: Yes, your Honour, that is exactly our point, and we realise that the Full Bench wasn't assisted on the previous occasion by the employers' application by them seeking something other than what we say is properly fixed minimum rates for New South Wales apprentices. The Full Bench also wasn't assisted by the union in that case, your Honour, because our position was that all of the rates that then existed in the award were properly fixed minimum and the rates shouldn't be further adjusted through item 51(4).

PN362

So the Full Bench did what it could in those circumstances, which was to convert the rates into minimum rates with a residual component and a total payment. They left the Queensland percentages as they were and left the New South Wales rate as it was, but they certainly didn't ignore the issue. In fact, in their orders of - varying the award in the supplementary decision on the award simplification in Print 900232, the particular clause containing the New South Wales apprentice rate - and I do have copies of that if it would assist your Honour.

PN363

THE SENIOR DEPUTY PRESIDENT: Yes, it may well do.

PN364

MS GRAY: The orders are attached to that supplementary decision, your Honour, and on page 3 of the order we can see that in paragraph 11 of the order - - -

PN365

THE SENIOR DEPUTY PRESIDENT: Well, what are they varying there?

PN366

MS GRAY: What they are varying there is clause 13.4 in paragraph 10 deleted 13.4.3 of the award.

PN367

THE SENIOR DEPUTY PRESIDENT: Which award?

PN368

MS GRAY: The Production and Engineering Award, your Honour.

PN369

THE SENIOR DEPUTY PRESIDENT: So by that time it had been simplified?

PN370

MS GRAY: Yes, it was done in several stages. There was an initial simplification to take out the non-allowable matters. There was a further simplification under an item 51 review which included the minimum rates adjustment and we would concede with exception of the New South Wales apprentices or without the Full Bench being assisted in terms of the comparison between the metal industry and the coal industry for appropriate percentages in Queensland.

PN371

THE SENIOR DEPUTY PRESIDENT: Yes.

PN372

MS GRAY: But when they varied the award, your Honour, they did vary the clauses which related to apprentices in Queensland and in New South Wales by replacing for example in the Queensland clause the reference to the group B weekly rate and inserting in lieu thereof the mine worker induction level 2 weekly wage rate. So orders were made directed to the specific provisions of the award dealing with both Queensland and New South Wales apprentices which is a clear indication we would submit, your Honour, that the Full Bench, it wasn't an oversight by the Full Bench. It was the Full Bench doing really what it could on the material before it at the time.

PN373

THE SENIOR DEPUTY PRESIDENT: Yes, I think Mr Turner accepts that.

PN374

MS GRAY: Now, your Honour, it is one thing for an employer to seek to have the Commission vary an award. I think that we would certainly agree with Mr Turner that the New South Wales apprenticeship issue has been the subject of discussions between the parties over many years and essentially I think the same position has been held, although initially the New South Wales employers wanted a flat amount in New South Wales for apprentices and there was a percentage amount agreed to in Queensland. Both of those matters as I understand it went into the award by consent but it was the employers position that New South Wales apprentices should have been a flat.

PN375

Subsequently and as years went by the Queensland - the New South Wales Minerals Council or Mining Council as it was and then Minerals Council changed to a position of wanting percentages but they wanted the Queensland percentage. At no time have they brought to the Commission a full case and proper evidence to justify an equalisation between New South Wales and Queensland rates. It is not unusual or unique in awards of this Commission for different rates of pay to apply in different states for work of the same nature.

PN376

It is also not unusual, your Honour, for awards to contain different rates for apprentices and certainly in the Full Bench case a representative of the CEPU gave an example of the Electricians Award being one on kind whereby different rates for apprentices applied in different states. So simply the existence of those differences are not we submit of such moment as to move the Commission to standardising those rates across states or even between industries. What we would say, your Honour, is that - and if I could have up one more document which is some calculations which I would like to speak to.

EXHIBIT #CFMEU4 DOCUMENT CONTAINING CALCULATIONS

PN377

MS GRAY: Thank you, your Honour. Your Honour, the second paragraph, "that if the last safety net review increase is applied the percentage would be," was the position which we put to the New South Wales Minerals Council as something which the union would consent to in a variation of the New South Wales apprenticeship rates in the award. We would also indicate that we would be prepared if the Commission wished to vary the award to ensure that the difficulty which has arisen and has only arisen since the application of safety net review increases to properly fix minimum tradespersons' rates in the Coal Mining Industry Award is not to worsen, then we would submit that the union would consent to the New South Wales apprentices' rates being converted to those which are specified in the first paragraph, your Honour, which does not have the latest safety net review increase.

PN378

We would be prepared to withdraw that part of our application which pertained to New South Wales apprentices for the safety net review increase and for the rates as they existed at the time that the Full Bench made the orders giving effect to the award simplification of the Production and Engineering Award that we would consent to those flat rates as they then existed in relation to the properly-fixed minimum tradesperson rate be converted into those percentages of 61 per cent through to 89.3 per cent. We would note - - -

PN379

THE SENIOR DEPUTY PRESIDENT: Well, that suffers from the same vice as Mr Turner's application does it not? They are figures without evidence to support them. I understand the way they were put in the context of negotiations but in terms of an arbitration if you press for those figures I would need to conduct the same sort of exercise wouldn't I?

PN380

MS GRAY: Yes, but we would say that it is the New South Wales Minerals Council that has the application which seeks to vary the apprentices' rates, your Honour.

PN381

THE SENIOR DEPUTY PRESIDENT: Yes.

PN382

MS GRAY: That is simply our if you like cross-application on our feet to their position. We say that it isn't for the union to bring that material except in reply to the application and material of the companies and because they have brought no evidence and they have brought no further submissions in addition to what was put before the Full Bench we would say that this Commission isn't in a position to accede to their application.

PN383

We would also note that in the third paragraph on CFMEU4, your Honour, that if in fact the New South Wales Minerals Council application was successful, then it would lead to, and we've taken note of a grandfathering provision which isn't actually in the latest draft order, New South Wales Mineral Council 5, but in the absence of a grandfathering provision and for all future apprentices it would be a reduction in the first 3 years of apprenticeship, fairly substantial amounts and the fourth year apprentice would receive a small increase.

PN384

THE SENIOR DEPUTY PRESIDENT: Yes, on your submission, Ms Gray, how many employees, assuming that I am minded to grant the employers application, would be affected or have their salaries grandfathered?

PN385

MS GRAY: Well, we would agree with Mr Turner that there would be certainly no more than 50 apprentices in New South Wales coal mines currently and certainly the first 2 years of apprenticeship are generally served with the exception of Power Coal through a group scheme or an outside employing company which gives those apprentices experience in industries other than coal mining and then brings them into coal mining environment.

PN386

THE SENIOR DEPUTY PRESIDENT: Are they paid at the apprentices' rates for the relevant industries in which they are provided experience are they?

PN387

MS GRAY: They may well be, your Honour, as they are moved around but certainly when they are brought into coal mining sites they are paid the coal mining industry rates. Does Mr Turner need to add to that?

PN388

MR TURNER: Perhaps if I can assist, your Honour.

PN389

THE SENIOR DEPUTY PRESIDENT: Yes, my ignorance is becoming very apparent I'm sorry. I need an education here.

PN390

MR TURNER: Thank you, your Honour. The training scheme generally within New South Wales for first and second year apprentices, those apprentices whilst they are working within coal mines will also be doing work elsewhere. They are paid under the training scheme rates of pay themselves. The only time that first and second year apprentices are paid according to the award is when they are employed fully and wholly by the company itself. So in general terms apart from Power Coal the majority of the apprentices in first and second years are actually paid significantly less rates.

PN391

THE SENIOR DEPUTY PRESIDENT: Yes. What are the training scheme rates?

PN392

MR TURNER: I don't have those rates before me, your Honour.

PN393

THE SENIOR DEPUTY PRESIDENT: Could they be provided to me?

PN394

MR TURNER: They could be, yes.

PN395

THE SENIOR DEPUTY PRESIDENT: Yes, Ms Gray?

PN396

MS GRAY: The reason why I had that third paragraph, the calculation from that third paragraph in CFMEU4, your Honour, was to demonstrate that when one looks at CFMEU2 which was the supplementary submissions pertaining to apprentices in the Full Bench simplification case and in the draft variation which was provided and attached to that supplementary submission that - if your Honour could bear with me while I find the correct page, it has page 7 down the bottom, your Honour, and on the facsimile type, it is page 10 of 28.

PN397

THE SENIOR DEPUTY PRESIDENT: Yes, I have that.

PN398

MS GRAY: And your Honour would note that in the application which was before the Full Bench by way of a New South Wales employers in the award simplification case in respect to apprentices in New South Wales that the residual component is essentially the same as the third paragraph in CFMEU4, that is of course, because although this is an attempt by the employers to put forward what they thought were properly fixed minimum rates but really an equalisation with Queensland, in doing so they were clearly, by flat amounts, looking for the same result as substitution of the Queensland percentage.

PN399

So they have done the same thing, your Honour, via a different way before the Full Bench as flat amounts with a supplementary, a residual component and a total payment all based on the Queensland percentage in the case before your Honour simply a transition to a Queensland percentage and I would also note that, perhaps it is nit picking, but in exhibit NSWMC5 the proposed variation again does not actually specify what the percentage is of for apprentices other than adult apprentices.

PN400

I note that there is a line that has been put in to that provision by the Full Bench which pertained to adult apprentices which tied it to the level 2 rate but the draft order does not - - -

PN401

THE SENIOR DEPUTY PRESIDENT: Yes, and that is the total rate we are talking about, isn't it?

PN402

MS GRAY: Yes.

PN403

THE SENIOR DEPUTY PRESIDENT: The total rate.

PN404

MS GRAY: Yes, your Honour.

PN405

THE SENIOR DEPUTY PRESIDENT: Yes, which again isn't quite spelt out in the award.

PN406

MS GRAY: Your Honour, the reason why we had reserved our position at the beginning of today was that we had anticipated - and also your Honour, why we thought perhaps today might have been a programming was that we were anticipating if the employers were finally going to run this case then they would be bringing a substantial case. We submit they haven't done so, they have simply repeated both the claim and the support for that claim as an exercise the same as what was done before the Full Bench. We would submit, your Honour, that in terms of trying to be helpful the union would be prepared to withdraw its application to vary the award by the last safety-net increase insofar as it pertains to New South Wales apprentices.

PN407

We would also be prepared, your Honour, to consent to a variation of the award which ensured that the difficulty with safety-net reviews rather than us just not proceeding with them in respect to New South Wales apprentices could be converted in to that percentage which they currently are in relation to the tradesman classification. Other than that, your Honour, we oppose the application of the New South Wales Minerals Council in its entirety. We say that if this Commission is to vary the award to insert "properly fixed minimum rates for New South Wales apprentices" it should do so on an appropriate fulsome case being brought to it.

PN408

In the absence of that we would submit that this Commission is in no better position than the Full Bench was in terms of any attempt to vary the New South Wales apprentices rates to equalise them now or overtime with the Queensland rates, as was indicated to the Full Bench by our union, there are different apprentice schemes, there are different historical reasons for the New South Wales and Queensland apprentices not being line-ball. We would also note that the Queensland apprentice percentages are not line-ball with the Metal Industry, so a complete - a simple substitution of the Metal Industry percentages would not be appropriate, in our submission.

PN409

It would also further complicate the situation which currently exists in the award of a difference between New South Wales and Queensland apprentice rates. We would request that the Commission decline to vary the award on the basis of the submissions which have been put and more, in particular, not been put by the employer applicants and I have indicated the areas where we are prepared to be flexible and helpful if at all possible, your Honour, but beyond that we most certainly reserve our rights to ensure that any variation to New South Wales apprenticeship rates now or in the future is done as part of a properly brought case either as a setting them as properly fixed minimum, or if there was some sort of greater exercise being some type of lining up between Queensland and New South Wales and certainly our position in a case such as that, your Honour, would predicably be that the Queensland rates should really be brought up to the New South Wales one, but we would say that is an argument for another day. Subject to any questions that the Commission has, I'm afraid that that is as much assistance I can be.

PN410

THE SENIOR DEPUTY PRESIDENT: Thank you, Ms Gray. Mr Turner?

PN411

MR TURNER: Yes, thank you, your Honour. The proposal put forward by the union was in fact considered by the companies and the companies rejected that proposal. So the proposal is not a new proposal to the companies. It is true that as outlined the rates on occasions do differ within industries, within States. Within the Production and Engineering Award, however, that award applies to both Queensland and New South Wales and the rates applicable to that award are the same in both States.

PN412

SO we would say that in relation to the proposition that because rates are different on occasions that that is the reason that they should remain different here. We simply say that they are essentially the same. With regard to the question of the skills and duties of the various aspects of - and years of the apprentices themselves, we have relied on the issue that the Queensland rates and the percentage rates shown within the award were arrived at by a Tribunal - - -

PN413

THE SENIOR DEPUTY PRESIDENT: What Tribunal?

PN414

MR TURNER: It would have been the Coal Industry Tribunal.

PN415

THE SENIOR DEPUTY PRESIDENT: Well, so are the New South Wales rates.

PN416

MR TURNER: Sorry?

PN417

THE SENIOR DEPUTY PRESIDENT: So were the New South Wales rates weren't they?

PN418

MR TURNER: Yes, your Honour. What I'm saying is that the industry itself, whether it is in Queensland or in New South Wales is the Coal Mining Industry, whether it be underground or open cut, is very similar. So that the duties and responsibilities within the various classifications within the award over a long period of time have been a matter of joint discussion. So we were relying on the fact that the percentage rates, the particular percentage rates within the award, were arrived at and given the similar nature of the work performed within the industry, that that was an appropriate percentage rate.

PN419

Our main argument is, of course, and we still say our main argument is that it provides the proper bench mark and that the way that the rates are currently constructed will simply lead to the anomaly increasing. I have regard, however, to your Honour's comments and the difficulty that the lack of specific identification skills might provide and also in relation to the fact that we have a new advocate to the table. If your Honour was to require and provide an opportunity for further written submissions, we would be happy to do that. Otherwise we would simply rely on what has been put before you today. Thank you, your Honour.

PN420

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Smith?

PN421

MR SMITH: Thank you, your Honour. Only two points in reply and they were touched on by Mr Turner. Firstly, the concept of the original rates being inserted in the coal mining industry for apprentices in New South Wales is flat dollar amounts is not the issue so far as I am concerned. Our problem is what has happened to those rates subsequent to that time by virtue of an application of wage increases that don't bear any relationship to the proportional relationship between the apprentice rates and the tradesmen's rates. The decision of the New South Wales Industrial Commission in court session that Mr Turner handed up to you actually deals with that issue.

PN422

In particular, they indicate I think that they adopt the principles of then Australian Conciliation and Arbitration Commission in relation to the way in which rates should be adjusted for what they term "junior employees". In that case both apprentices and juniors wherein even if the amounts are expressed as flat dollar amounts, subsequent increases should only be applied proportionately to the relationship between the apprenticeship rate and the total adult rate. So our problem is not that the rates are expressed as flat dollar amounts, it is their quantity and the fact that what is going to happen to them in relation to the tradesmen rate as time goes by in relation to the safety net adjustments.

PN423

The second issue about equalisation of rates, our submission can be twisted to the point where it can be construed to be an equalisation of rates. To us it is about the correction of an anomaly and not only in terms of the way the New South Wales apprenticeship rates are expressed but if one looks at the total award as Mr Turner pointed out, the only area, the only area in the award where one sees any differential, either in rates of pay or conditions of employment is in relation to junior apprentices rather than adult ones in New South Wales.

PN424

Every other classification including the trades rates and the adult apprenticeship rates are the same and for there to be an argument that in some way the work value of apprentices in New South Wales, junior apprentices, is in some way different than it is for Queensland or for that matter adult apprentices in the two states is, in our submission, from companies that operate across both states. Ms Gray made a mention to Anglo Coal right at the opening of her report back to you. Anglo Coal is actually the parent company operating in both Queensland and New South Wales of the companies that I represent.

PN425

So having experience in operating in those states we, whilst we haven't got somebody in the witness-box to allude this as evidence for you, there is essentially no work value difference in the apprentice work between the two states and in fact that has been lined at the adult classification level. One needs to bear in mind that this award is designed to operate as a safety net award and in light of that, we would submit that the application should be granted. If the Commission pleases.

PN426

THE SENIOR DEPUTY PRESIDENT: Yes.

PN427

MS BRADY: Your Honour, I indicated earlier that I may be able to get instructions on these issues after hearing Ms Gray's submissions. It appears to me that issues raised today are a bit more complicated than I would be able to address in a 10 minute phone call and I would seek, with the consent of the parties and your consent of course, to put our position in writing perhaps, say within 7 days just so that I can address some of those more complicated issues for the client.

PN428

THE SENIOR DEPUTY PRESIDENT: We might go off the record for a few minutes, if that is all right with everybody.

OFF THE RECORD

PN429

THE SENIOR DEPUTY PRESIDENT: Now, I've had a discussion with the parties and it is agreed that the employers will provide evidence and submissions in support of the apprentice rates in New South Wales for which they contend. It has been agreed that the employers will provide witness statements upon which they rely and a comprehensive outline for their submissions in support of their case by close of business on Friday, 3 May 2002. For the unions - and Ms Gray, I would ask you to communicate this to the other unions if you would be so kind.

PN430

MS GRAY: Certainly, your Honour.

PN431

THE SENIOR DEPUTY PRESIDENT: Will provide their witness statements and detailed outline of submissions in support by Friday, 7 June 2002. I will adjourn the matter until 10.15 am on Wednesday, 12 June 2002 in Sydney for a report back and for the programming of any further hearings which hearings may or may not require the taking of evidence and the conducting of inspections. Unless there's anything else, the Commission will adjourn on that basis. Thank you.

ADJOURNED UNTIL WEDNESDAY, 12 JUNE 2002 [12.07pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #NSWMC1 LIST OF COMPANIES FOR WHOM MR TURNER APPEARS PN162
EXHIBIT #NSWMC2 MR TURNER'S OUTLINE OF SUBMISSIONS PN194
EXHIBIT #NSWMC3 TABLE OF DECISIONS PN226
EXHIBIT #NSWMC4 COMPARISON OF RATES PN237
EXHIBIT #NSWMC5 DRAFT ORDER PN256
EXHIBIT #S1 DOCUMENT MARKING MINIMUM RATES' COMPARISON PN280
EXHIBIT #S2 DOCUMENT RE AWARD PN281
EXHIBIT #CFMEU2 SUPPLEMENTARY SUBMISSIONS OF THE APPELLANT EMPLOYERS PROPOSED CLASSIFICATION STRUCTURE AND WAGE RATES THAT WAS BEFORE THE FULL BENCH IN THE AWARD CERTIFICATION APPEAL PN358
EXHIBIT #CFMEU3 EXTRACTS FROM THE TRANSCRIPTS OF PROCEEDINGS PN358
EXHIBIT #CFMEU4 DOCUMENT CONTAINING CALCULATIONS PN377