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Australian Industrial Relations Commission Transcripts |
AUSCRIPT PTY LTD
ABN 76 082 664 220
Level 4, 60-70 Elizabeth St SYDNEY NSW 2000
DX1344 Sydney Tel:(02) 9238-6500 Fax:(02) 9238-6533
TRANSCRIPT OF PROCEEDINGS
AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION
SENIOR DEPUTY PRESIDENT CARTWRIGHT
C No 00402 of 1998
Review under Item 51, Schedule 5,
Transitional Wrola Act 1996 re
award simplification
C No 24463 of 1999
GIO AUSTRALIA AWARD 1991
Application under section 113 of the Act
to vary the above award re award simplification
and safety net review - wages April 1999
SYDNEY
2.00 PM, THURSDAY, 27 MARCH 2003
Reserved for Decision
PN1
THE SENIOR DEPUTY PRESIDENT: I will take the appearances, please, although I note the appearances haven't changed since our last hearing on this matter, so it is probably not necessary.
PN2
MR SMITH: I think that is correct, your Honour.
PN3
THE SENIOR DEPUTY PRESIDENT: Ladies and gentlemen, we've got two things to deal with at this afternoon's hearing - two matters rather to deal with - to complete the item 51 review of the award, that is, the classification structure and the wage rates, both of which are contained in appendix A which is incorporated in the award.
PN4
At the prior hearing and subsequent conferences, it was apparent that there is a reasonable amount of common ground on how to proceed. Firstly, there is agreement that the classification structure needs updating; secondly, in updating the classification structure, it is common ground that a four-level structure would be appropriate; and thirdly, in line with the Commission principles, the wage rates require review to convert to properly fixed minimum rates.
PN5
Disagreement has been about details about the descriptives at some levels in the classification structure and about wage rates to attach to them. Each of you put a position and supporting materials in the hearing on 19 December last year and, based on the apparent similarities in that material, I gave time to explore the prospects of agreement. Further time was granted for discussion following a conference in the Commission on 18 February to follow up that hearing on 19 December.
PN6
Although the parties, on my recollection, sought two weeks, I set today's hearing to allow adequate time and after consulting those present about the date. I indicated that if agreement could not be reached prior to today, then I would hear submissions and determine the matter. That is what we are here for. Unless there is an agreed position for me to consider, I propose to hear your submissions on the clauses still to be reviewed and to vary the award to complete the item 51 review.
PN7
When my associate rang to check progress for today, it was reasonably apparent from the answers that an agreed position was unlikely to be forthcoming. So to manage the Commission's processes efficiently, I sent directions that each party was to provide its proposed draft order by 4 pm on Monday. On Friday, it is my understanding that the union sought extra time. It was granted. As requested, the time for providing the draft order was extended to 4 pm, Tuesday. GIO complied with the direction; the FSU did not.
PN8
Now, the Commission does not issue directions lightly. It exercises its power to issue directions and to determine its proceedings, to manage its business effectively, and to assist the achievement of statutory outcomes. When directions are issued, they are to be followed.
PN9
Now, as a threshold matter, I want to hear your submissions on how we should proceed, noting that one party has complied with directions and one party has not. Who wants to go first?
PN10
MR SMITH: Your Honour, I am happy to go first if that assists the Commission. I have prepared a short outline of oral submissions which I would like to hand up to assist the Commission.
PN11
THE SENIOR DEPUTY PRESIDENT: I am seeking only submissions in relation to compliance with directions.
PN12
MR SMITH: Yes. Your Honour, at paragraph 1.4 of the introduction of the outline of oral submissions, I note, as indeed your Honour has this morning, that GIO has provided in accordance with the Commission's directions, the proposed draft order to conclude the award simplification and that the FSU has sought to rely on an alternative draft order and you will note there that I've picked up that the FSU has not complied with the Commission's direction. We would - - -
PN13
THE SENIOR DEPUTY PRESIDENT: It is probably more appropriate that I hear from the FSU first, isn't it, since they are the ones in default on directions.
PN14
MR SMITH: Certainly, your Honour.
PN15
THE SENIOR DEPUTY PRESIDENT: You can say what you want to in response.
PN16
MR SMITH: Yes.
PN17
MS HANNAN: Yes, your Honour, thank you. In response to your Honour's comments on the directions, the FSU would offer as follows: we were in communication with your associate to indicate that there would be a brief delay and our draft order was forwarded to the Commission yesterday. The reason for that, your Honour - and we don't take the Commission's directions lightly either - is that up until Thursday - - -
PN18
THE SENIOR DEPUTY PRESIDENT: Well, it appears that you do.
PN19
MS HANNAN: No, your Honour.
PN20
THE SENIOR DEPUTY PRESIDENT: Clearly, you haven't complied, and when you made the contact, it was clear from what was reported to me that you didn't take that direction seriously. You didn't apply for a variation of the direction; you simply said that you were not able to provide the material until the next day.
PN21
MS HANNAN: I am sorry, your Honour, if we didn't frame the application appropriately. We were seeking to comply with the Commission's directions and we don't take it lightly. The position by way of background, if your Honour would hear me, is that, up until Thursday night, we were still negotiating with GIO. We provided an alternate position to them Thursday night and I was away from the office until Tuesday. GIO indicated that our meeting that we had scheduled to further progress those discussions was not going to take place and, as a result of that, all of the material that we had prepared on a subsequent draft order had to be revisited and amended and it was on that basis that it was then supplied to the Commission following further discussions internally.
PN22
But, as part of those discussions that we had with GIO - and I think that it is appropriate that I do mention it and I don't believe that GIO will take issue with it - there was a consideration of incorporating rates up to 2002, and all of those classifications were amended by that and, at that point, the table was expressed, and we have amended it in the draft order that we've supplied to the Commission but the draft order was expressed in such a way to incorporate the nine levels in one table. We have since separated that out. So those were the circumstances surrounding it, your Honour.
PN23
If the position is that, formally, we should have sought an application for a variation, then that is an unintended oversight. The will was to comply with the direction. Given the absence from the office and given that there was no further prospect of settlement with GIO - and I do notice part of those discussions is identified in correspondence to you - that we did take the Commission's suggestions on board about how we might be able to effect settlement by having regard to those safety net variations, but, at the end of the day, that was not able to occur.
PN24
MR SMITH: Your Honour, we would say that there was nothing in the without prejudice discussions between the company and the FSU that would have provided any obstacle to the FSU preparing a draft order which it would seek in the absence of agreement being reached. So we make that point. Other than that, I am instructed that the company sees this as a matter for the Commission on how best to proceed with the FSUs position and lack of compliance with the directions.
PN25
THE SENIOR DEPUTY PRESIDENT: Do you want to continue on from that and speak to the submission you've made on how we should proceed?
PN26
MR SMITH: Yes, your Honour. In the introduction we outline a number of the matters which indeed your Honour has highlighted in your opening comments this afternoon, which notes that it's now necessary for the Commission to determine an appropriate order to conclude all outstanding matters in the item 51 review process as other parties have been unsuccessful in reaching an agreement. Our suggested approach to today's proceedings, subject to what your Honour may consider appropriate and in light of your observations in relation to the FSUs failure to comply with directions would be that GIO would outline its case in evidence, the FSU would then outline its case and present its evidence.
PN27
There would then be the opportunity for both the parties to make submissions, with the company going first, the FSU second and then GIO having the opportunity to reply to the FSUs case by way of conclusion. Of course, from the company's point of view we just need to have some understanding of what the FSUs position is and in what particular order that may be invited, whether it's a previous draft order or the most recent order that failed to comply with the direction.
PN28
THE SENIOR DEPUTY PRESIDENT: Okay. Thank you, Mr Smith. Ms Hannan, anything - - -
PN29
MS HANNAN: Your Honour, the position that FSU will be relying upon is as announced in conversations I've had with Mr Smith. It should be quite clear. It's the order that we sent through yesterday to both Mr Smith and to the Commission, which deals with the - or the substantial amendment, if you like, deals with how we've taken our part of the table to deal with levels 6 to 9 and incorporated in a table 2.2 and that was spoken to in conversations that I've had with Mr Smith.
PN30
THE SENIOR DEPUTY PRESIDENT: And in terms of Mr Smith's suggestions on how to proceed, you have no objections?
PN31
MS HANNAN: No, your Honour.
PN32
THE SENIOR DEPUTY PRESIDENT: Very well, Mr Smith.
PN33
MR SMITH: Thank you, your Honour. Am I able to proceed on the basis of the FSUs position as outlined just then by Ms Hannan? I just note that that particular order is the order that failed to comply with the directions. I just wonder whether it's properly before the Commission.
PN34
THE SENIOR DEPUTY PRESIDENT: Yes, and you highlight the point that is on my mind. We previously have a draft order from the hearing on 19 December which was marked FSU1.
PN35
MR SMITH: Yes.
PN36
THE SENIOR DEPUTY PRESIDENT: And I'm minded not to accept the order that has not been submitted in compliance with directions but rather to rely on FSU1. However, I'm also conscious of the futility of such a point because my duty is to vary the award to satisfy the requirements of the Act and obviously in varying the award I'm going to hear any arguments and submissions that you want to make. And so while one might posture an express great dissatisfaction with the FSUs failure to comply, ultimately it doesn't change the decision that I have to make, which is how is the award to be varied to comply with the requirements of the statute?
PN37
MR SMITH: Yes.
PN38
THE SENIOR DEPUTY PRESIDENT: And so it's clear that the FSU has the option to put its arguments this afternoon for the variations that it believes will most appropriately meet the requirements of item 51. So whether that's done orally or whether it's done in the form of a written order, it seems to me rather futile to do something that doesn't get us anywhere. And so I will accept the FSUs submission today that it works on the basis of the draft order that was submitted, not in compliance with directions. You can see I'm pretty cheesed off about it, but being that as it may, as I say, there's no point in doing something futile that's not going to get us towards the objective. So let's get on with it.
PN39
MS LEWIS: Your Honour, before we do proceed, might I just make a brief comment regarding your annoyance and our having made you annoyed.
PN40
THE SENIOR DEPUTY PRESIDENT: Yes. This matter has been going on for ages.
PN41
MS LEWIS: And, your Honour, you may also recall that the FSU sought an adjournment or a re-listing of today's matter.
PN42
THE SENIOR DEPUTY PRESIDENT: Yes, which I refused.
PN43
MS LEWIS: And that's why I've returned from sick leave to attend today. Your Honour, we did not intentionally fail to comply with the direction as Ms Hannan has already detailed. Unfortunately, Ms Hannan was operating under the added disadvantage - which is an internal matter, I know, but I would like to bring it to your attention. She was operating with the added disadvantage of not being able to have me available to assist her. I've actually been on sick leave all of this week and have only returned because of today's hearing, otherwise I would be home tucked up in bed recovering from the flu.
PN44
So we didn't intentionally not comply with the order - or the directions, rather. Certainly, we have failed to comply with the directions in that we didn't submit a draft order by the directed date, but I note that notwithstanding that we missed the deadline, we have still provided a draft order prior to today's hearing. Also, I note that FSU exhibit 1 was tabled at the December hearing. It was in fact tabled after we resumed from conference as an indication to you, your Honour, that perhaps the parties weren't so far off reaching agreement, because we had put that draft order to the company during the conference on that day and we adjourned to go back on the record just to give us more time or to indicate where the parties stood at that stage and to indicate that after all that time we might still have an opportunity to have consent on the matter. We're now three months, four months down the track and we don't have consent on that matter.
PN45
THE SENIOR DEPUTY PRESIDENT: That's not quite my recollection of the order of batting on 19 December, but it's a point that is not significant. I must say I'm pleased to see you here and thank you for making the effort, Ms Lewis.
PN46
MS LEWIS: Well, I'm not pleased to be here but I am here, your Honour.
PN47
THE SENIOR DEPUTY PRESIDENT: And I hope you make it through the afternoon okay.
PN48
MS LEWIS: So please bear with me if I have to ask for a very sudden adjournment.
PN49
THE SENIOR DEPUTY PRESIDENT: Yes. I'm pleased to see your leg is not in plaster at least.
PN50
MS LEWIS: The day hasn't finished yet.
PN51
THE SENIOR DEPUTY PRESIDENT: Okay. Mr Smith>
PN52
MR SMITH: Thank you, your Honour. I might add that the parties are very happy to be able to move through these matters quickly this afternoon and the available time will be sufficient, if I might note that. Your Honour, in paragraph 3 of the outline of oral submissions of GIO Australia Limited, we proceed to set out an outline of GIOs case. GIO continues to rely on the outline of submissions dated 6 November 2002 that are marked GIO1 in these proceedings, the statement of Dennis Walsh, which is dated 6 November 2002 and marked GIO2 in these proceedings, and the supplementary materials referred to in the submissions of GIO Australia Limited, and they're marked GIO3.
PN53
In addition, GIO seeks to rely on matters including the GIO proposed order prepared for the purposes of the Commission proceedings on 27 March 2003. It may be convenient, your Honour, to mark that order at an appropriate time.
PN54
THE SENIOR DEPUTY PRESIDENT: Yes, that's the one sent by fax on 25 March?
PN55
MR SMITH: Yes.
PN56
PN57
MR SMITH: The supplementary statement of Dennis Walsh, a copy of which was filed and served late yesterday I think.
PN58
THE SENIOR DEPUTY PRESIDENT: Really? It came into my hands at quarter to 2.
PN59
MR SMITH: Yes, well, we certainly did better than that.
PN60
THE SENIOR DEPUTY PRESIDENT: Yes, it's marked - it is indeed marked yesterday, 4.23.
PN61
MR SMITH: Yes.
PN62
THE SENIOR DEPUTY PRESIDENT: And I confess to a failure - or rather a slow working of the Commission's process.
PN63
MR SMITH: It may assist to mark that - - -
PN64
THE SENIOR DEPUTY PRESIDENT: So we'll mark - - -
PN65
MR SMITH: - - - document as well, please.
PN66
THE SENIOR DEPUTY PRESIDENT: GIO5, supplementary statement of Dennis Walsh dated - well, it is not dated. Yes, it is. It is dated 25 March.
PN67
PN68
MR SMITH: And we also seek to rely on an FSU acknowledgment that the award has not been subject to a minimum rates adjustment process and we refer to two transcript references from proceedings previously in this matter and those proceedings were conducted on 6 November 2002.
PN69
Your Honour, the proposed draft order marked GIO4 we say addresses some of the issues raised by the FSU in discussions. It is on that basis that we say that there has been some adjustment made, in particular into the area around the descriptors in order to accommodate some of their concerns in a genuine attempt to try and close the gap between the parties and reach agreement.
PN70
We say that the order reflects the current classification structure currently applying to GIOA; that it complies with the requirements under the WROLA Act for the review of awards; that it reflects the transition of GIO employees from the previous nine level award structure to the current four level agreement structure; and that it incorporates the minimum rate adjustment process. We say that it preserves minimum award rates for employees who were employed as at 23 July 2002 and that it does not reduce the scope of the award in any way, that is, that the award is expressed to apply to all employees at GIOA at clause 5, parties bound. The draft order also incorporates the 1999 safety net adjustment.
PN71
By way of outline of GIOs case, we would make the following comments about the FSU proposed order which we say fails to remove an obsolete nine level award classification from the classification structure: it does not accurately reflect the classification structure currently in place at GIO; fails to accurately reflect the transitioning of employees from the award classification structure to the AMP GIO classification structure; does not properly set minimum rates; and fails to attach descriptors to each of the proposed classifications.
PN72
Your Honour, Mr Walsh is in attendance in the Commission today and available to give evidence. I haven't yet had an indication of as to whether or not the FSU will be seeking to cross-examine - - -
PN73
MS HANNAN: Yes, briefly.
PN74
MR SMITH: I understand a brief cross-examination is being sought, so at this point I ask Mr Walsh to come forward in order to be available to give that evidence.
PN75
THE SENIOR DEPUTY PRESIDENT: Okay. While Mr Walsh is coming up - - -
PN76
MR SMITH: Yes.
PN77
THE SENIOR DEPUTY PRESIDENT: Just one question of clarification - on your draft order, 14.2.1 - it says "An employee occupying levels higher than level 4". Now, is that level 4 in the proposed classification structure or is that level 4 in the existing nine step structure? In other words, is it level 4 in the old or the new structure?
PN78
MR SMITH: It's level 4 in the new, your Honour.
PN79
THE SENIOR DEPUTY PRESIDENT: I see. Thank you.
PN80
MS HANNAN: Your Honour, just before Mr Walsh gives his evidence that is formally recorded we will ask our witnesses to leave.
PN81
PN82
MR SMITH: Could you please state your full name and address?---Dennis John Walsh, 55 Branch Avenue, Figtree.
PN83
Mr Walsh, have you prepared statements in these proceedings?---Yes, I have.
PN84
Do you have a copy of the statement marked GIO2, which is dated 6 November 2002, with you?---Yes, I do.
PN85
Are there any changes you would like to make to that statement?---No, not to the statement itself, no.
PN86
Are the contents of the statement true and correct to the best of your knowledge and belief?---Yes, they're true and correct to the best of my knowledge.
PN87
I seek to tender that statement, your Honour.
PN88
THE SENIOR DEPUTY PRESIDENT: Thank you. That's previously been marked - - -
PN89
MR SMITH: Marked.
PN90
THE SENIOR DEPUTY PRESIDENT: - - - GIO2.
PN91
MR SMITH: Thank you, your Honour. Have you prepared a further statement headed Supplementary Statement of Dennis Walsh Dated 25 March 2003?---Yes, I have.
PN92
Do you have a copy of that with you?---Yes, I have a copy.
**** DENNIS JOHN WALSH XN MR SMITH
PN93
Are there any changes you would like to make to that statement?---No, there's no changes to the statement.
PN94
Are the contents of the statement true and correct to the best of your knowledge and belief?---Yes, they're true and correct to the best of my knowledge.
PN95
I seek to tender that statement as well, your Honour.
PN96
THE SENIOR DEPUTY PRESIDENT: Yes. That's been marked GIO5.
PN97
PN98
MS HANNAN: Mr Walsh, could I take you to point 15 of your - I believe it's GIO8 - GIO2?---The 6 November statement or 25 March?
PN99
Your 6 November statement?---Point 15?
PN100
Point 15, yes. The position is that GIOA employees actually transmitted back to GIO Australia and became employees of GIO Australia around August 2001, did they not?---September 2001, yes.
PN101
Yes. Okay. So they were with AMP for a period of about - in terms of being employees of AMP - for about a period of nine months, roughly?---That would be correct, yes.
PN102
Right?---From January to September, yes.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN103
You would agree with me that in your statement at 16, again on that - sorry, your paragraph 16 again at that same statement, that the AMP job family groups that you referred to are not regulated by any award? They are, in effect, an over award arrangement adopted by the employer?---That is correct. They form part of the remuneration structure itself, yes.
PN104
That's right. Thank you. And, indeed, in your comment at 19 with the AMP GIO agreement that it wouldn't be entirely correct to say that there are all common conditions that apply between the AMP and the GIO employees, as there are a number of savings provisions and quite a detailed section of that agreement that preserves certain GIO conditions?---There are savings provisions in the agreement, but the term used there at point 19 seeks to explain in the general sense - it's generally accepted, as I would understand anyway, that we strove to put GIO and AMP employees into common terms and conditions of employment. That doesn't mean that they're identical. It just means that they're common.
PN105
Yes, however - but a whole section 2 of the AMP GIO enterprise agreement has a number of other conditions that would pertain only to GIO employees and not AMP - - -?---There were - there were some benefits that were locked in for existing GIO employees at that stage. Yes, that is correct.
PN106
And that would still be the case?---Yes.
PN107
Thank you. When you say, in point 21, that there's some uncertainty as to the extent of coverage that the AMP GIO agreement provides to GIO employees, it would be true to say that that's effectively a Suncorp challenge, isn't it, as to the legal effect of the AMP GIO agreement?---Could you repeat that again, please, Ms Hannan?
**** DENNIS JOHN WALSH XXN MS HANNAN
PN108
Wouldn't it be true to say, in your paragraph 20, when you talk about uncertainty, and elsewhere in your statement, about the application of the AMP GIO agreement to GIO employees, that that uncertainty or challenge, if you like, resides with Suncorp Metway?---It resides with Suncorp Metway. It also resided with GIO and I thought it was also residing in other areas - other people as well but, in that sense, it says what it says. There is some uncertainty as to the extent of coverage of the AMP GIO - at that time when I put the statement together - now provides for GIO employees. I stand by that statement. There's some uncertainty.
PN109
Yes, but as indeed that is a position that's driven by Suncorp?---Well, it's certainly a position that Suncorp, as I know it, holds but it's also driven by GIO as well, as a separate entity.
PN110
GIO is owned by Suncorp Metway?---Yes, it is.
PN111
It is? Thank you?---It's a separate employing entity at that point, though, and still is.
PN112
Have you had an opportunity to review the witness statements that have been prepared by FSU?---I have read through them, yes, I have. Yes.
PN113
These were the witness statements that were subject to some slight amendment and forwarded to your legal representatives yesterday?---Yes. I have copies up here if it's of assistance to you.
PN114
You're requesting - you have copies up there, do you?---No, I have copies up here, yes.
PN115
Do you have a copy of the competing draft orders, as it were?---Got a copy of the GIO and I have a copy, yes, of the - what I believe to be the FSU draft.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN116
You're fully prepared, Mr Walsh?---As always, I hope.
PN117
If I could take you to level 1, the descriptor there for GIO refers to a training with little or no vocational training or work experience and the level proposed by FSU denotes the entry level, does it not?---My draft show - they both show entry level. Is that - - -
PN118
That was my understanding from an earlier draft, too, but I'm just going on the one that I was faxed yesterday?---Oh, well, I may not have the correct draft, your Honour. The one I've got in front of me is - - -
PN119
So we both have entry level - - -?--- - - - the 27 March one. Is that the - - -
PN120
And you've got entry level for yours?---I've got entry level on this one.
PN121
For the GIO?---Yes.
PN122
That's what I thought, too?---Yes.
PN123
Well, moving along to the second set, both level 2s in draft orders refer to clerical service support, training technicals. If your Honour will just bear with me a moment. I'm just catching up with the exhibits. Your Honour, can I just seek to clarify - there was a draft order proposed by GIO previously identified, for the purposes of Commission proceedings 27 March which has a number of common descriptor levels that would correlate with what is being proposed in FSUs order but in the matter that was forwarded to us late yesterday afternoon, I have to say, there appear to have been some further changes to those descriptors in GIOs own award draft proposal.
PN124
THE SENIOR DEPUTY PRESIDENT: Sorry, I'm not - are you referring to GIO4?
**** DENNIS JOHN WALSH XXN MS HANNAN
PN125
MS HANNAN: I am, your Honour, as received yesterday, but the document that had formed part of discussions with the FSU last week and, indeed, a draft order that was forwarded to yourself on 25 March was different again. So I'm just alerting the Commission to some of my confusion. I didn't pick up yesterday, when we received the draft order, that there had actually been - - -
PN126
THE SENIOR DEPUTY PRESIDENT: Sorry, perhaps this is my misunderstanding. GIO4 is a document received on 25 March. Is there a different order around, a draft order?
PN127
MS HANNAN: Your Honour - - -
PN128
THE SENIOR DEPUTY PRESIDENT: And in saying that, I'm working off the fax header which shows the time and date.
PN129
MS HANNAN: If your Honour will just bear with me while I clarify this important point? Your Honour, I apologise for that confusion. I'm not clear on the draft order that GIO has proposed.
PN130
Mr Walsh, would you mind if we started again - - -?---Yes, that's fine.
PN131
- - - just for the purposes of the Commission following the matter? If I can take you back to level 1, there's a common descriptor there for both proposed draft orders, is there not?---Entry level. Yes, that's correct.
PN132
Yes, okay. There is substantial similarities between the level 2 proposed by GIO and FSU at level 2?---I'd have to agree with that, yes.
PN133
And again at level 3?---Well, that is similar, yes.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN134
Very similar, are they not? Yes?---Yes.
PN135
And again, at level 4?---Level 4, again, has a fairly common flavour running through each of the two drafts, yes. There are some little shades of differences but, basically, I think, they're already, overall, looking at the same outcome, as far as descriptor is concerned.
PN136
Right. Thank you, Mr Walsh.
PN137
THE SENIOR DEPUTY PRESIDENT: Just one point of clarification, Ms Hannan, picking up that point of similarity, so we know we are all on clear ground, can I take you to level 2 and in the most recent draft order, there's Customer Service - Call Centre operator/Claims Officer/Policy and Underwriting Services Officer?
PN138
MS HANNAN: Yes, your Honour.
PN139
THE WITNESS: Yes.
PN140
THE SENIOR DEPUTY PRESIDENT: Yes, it should - - -
PN141
MS HANNAN: That's what it should be.
PN142
THE WITNESS: Yes.
PN143
THE SENIOR DEPUTY PRESIDENT: So that's a typo, to miss out the "and" which was in the previous FSU1? Is it meant to be - the reason I ask is, the use of a capital U to begin "Underwriting" makes it appear as if it's a separate point but, when you compare this with FSU1, it would appear to be the description of the Job Policy and Underwriting Services Officer.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN144
MS HANNAN: Your Honour is correction is correct.
PN145
THE SENIOR DEPUTY PRESIDENT: Thanks. So there's no difference where the two refer to Policy and Underwriting Service Officer?
PN146
MS HANNAN: Your Honour, obviously, we deal in some detail in our submissions as to the differences with this draft order that we seek to replace the earlier draft order with - - -
PN147
THE SENIOR DEPUTY PRESIDENT: Yes, but - - -
PN148
MS HANNAN: - - - at an appropriate time.
PN149
THE SENIOR DEPUTY PRESIDENT: - - - what appears to be a difference in terminology and format is, in fact, illusory. It's in fact exactly the same.
PN150
MS HANNAN: Your Honour is right on that. Thank you.
PN151
Mr Walsh, in recent proceedings for the certification of the Suncorp GIOA General Insurance Business Integration Agreement 2002, you were involved in those proceedings, were you not?---In a background way. I haven't attended - very little of those proceedings myself but I have been there in the background.
PN152
It would be fair to say, would it not, that there are about 1500 agreement covered employees and about 315 management?---That would be a fairly accurate description of the numbers, yes.
PN153
Can I just ask you to have a look at Mr Stevenson's witness statement; point 8?---Yes.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN154
Would it be fair comment to say that at the time that the award was made in 1991, that there were employees employed at those levels at level 5; and for original claims module managers and regional policy services managers. I'm sure there are many more?---There are many more. That is some period of time ago, but from my recollections that would be fairly close to what the job descriptions would have been for some of the levels, yes.
PN155
Okay. At - - -?---In 1991 we're talking about; that is particularly about then, yes.
PN156
And I'll come to that in a moment. And then as you go up the structure, the increasing levels of responsibility were to be found in those particular areas because of the larger areas that people were in charge of?---Not necessarily. It could have been because of the nature of the expenditure of those particular divisions, as well as the number of staff that were managed by a particular person or supervised by person. There could be a number of factors; technical skills required to have. A range of processes would have been applied to work out what level grade it would be.
PN157
Okay. But it could include that criteria that it was a larger area of responsibility as well?---Oh, absolutely. Yes, it could have and would have in some cases include that particular criteria.
PN158
Okay. And that GIO employ various schemes and sales managers today?---Schemes. What - - -
PN159
Scheme managers?---I don't understand the question.
PN160
Within a particular business unit?---We employed - - -
PN161
Employ rather ?--- - - - sales representatives if that's what you're referring to?
**** DENNIS JOHN WALSH XXN MS HANNAN
PN162
No. Various scheme and sales managers - sorry, I'll break it up - various scheme managers now?---The terms - - -
PN163
For example, the other day in a visit that I had to GIO, it was attended by a senior scheme manager?---That would be a modern day expression of a - or functions that are carried on now at the moment. I think your question is related to what is happening in the 1990s.
PN164
No. But I'm just also asking you to have a look at point 8, which I think you've already answered, that there is a modern day equivalent to those areas that were carried on previously?---Well, there would be obviously roles of that type in today's world; but what level they would be at though and exactly what their duties would be I wouldn't be able to tell you this afternoon.
PN165
But in an updated form?---In some sort of updated form - - -
PN166
Updated form similar to what had - - -?---Roles of that would exist. I mean I could go on for some time. But I mean the concept of regional manager in its context as used here would have been relating to a different sort of regional manager to what they talk about now.
PN167
Yes?---Quite different.
PN168
Right. But in some form of updated form as to what existed previously, there is still approximately 315 managers who would do work of this type?---There's managers there, and we would have to look at the relativity of those roles compared to what their remuneration and structures are today. They could be quite different from where they were five, six, 17 years ago.
PN169
Yes, of course, and I'm not asking you to do a direct fit: only that they exist and in an updated form?---Well, managers do exist, yes, in different forms at the moment.
**** DENNIS JOHN WALSH XXN MS HANNAN
PN170
And if I could just take you back to the comparison of the two draft orders, it would be fair to say as it has already indicated by yourself, Mr Walsh, that there is a fair amount of commonality in two structures that are proposed as being relevant?---You're referring to descriptors only, Ms Hannan, or the whole - - -
PN171
I'm referring to the descriptors only in levels 1 to 4. But it would also be fair to say that the rates themselves, there's a fair amount of commonality with those, is it not?---Well, that's difficult to answer in the abstract in the sense that, yes, some of these dollars appear to be the same. But in the various drafts they sit in different columns alongside different levels, so that could have quite a substantial - makes for quite a substantial difference between both drafts in that respect.
PN172
Okay. But as you've - no, I'll withdraw that - and a number of those GIO employees who would be level 5 and above characterised as management would be on some form of contract?---Today?
PN173
Yes?---Just to make sure again we're not at cross purposes. The level 5 you're talking about is the level 5 in the AMP structure or the old level 5 in the GIO structure?
PN174
I'm sorry; the old structure in the GIO award as we've discussed in an updated form so those - perhaps I'll put it another way. Those 315 employees who are management in a number of forms as in an updated way as we've discussed, would be on some form of contract, would they not?---Absolutely, yes.
PN175
Right. Okay. If that contract were to fall over as the GIO award covers all employees, they would revert to the award?---If the contract was to fall over. I don't see how the contract would fall over.
PN176
It doesn't matter if it will or not. I'm asking - - -?---But if it did - - -
**** DENNIS JOHN WALSH XXN MS HANNAN
PN177
- - - if the contract was void, you would revert to - - -?---If you're asking, "Are all those employees subject to the GIO Australia Award", the answer is yes.
PN178
Yes. And if their contract was void the GIO Employees Award 2002 would - - -?---Would become the instrument - - -
PN179
The instrument - - - ?--- - - - that would underpin their terms, conditions and salaries; so no question about that. No dispute as far as I'm concerned.
PN180
Okay. Thank you, Mr Walsh; nothing further?---Okay. Thank you.
PN181
PN182
MR SMITH: Mr Walsh, do you recall that Ms Hannan asked you some questions about the standard application of the AMP GIO Agreement and I think she used the language of a Suncorp challenge to the legal - - -?---Yes, I recall that.
PN183
Yes. Is it the case to the best of your knowledge that Suncorp has, and indeed GIO has said, that it will continue to apply the AMP GIO Agreement until it's replaced by another agreement?---Absolutely. We've said verbally and put that in writing.
PN184
You will recall that Ms Hannan asked you a number of questions about the descriptors in I think what she described as the competing draft orders. Do you recall that?---Yes, yes.
**** DENNIS JOHN WALSH RXN MR SMITH
PN185
And Ms Hannan asked a number of questions that were suggesting there was a strong similarity between the two?---She did, yes.
PN186
Yes. Can I take you to the FSU proposed order? And if you look at the table in 14.1 and the descriptor associated with level 3, you will see that on the second line, it includes the following words, "May include supervisory role"?---Yes, it does. Yes.
PN187
Yes. Now, if I can ask you to look at GIO4 which is the GIO proposed order, is there similar wording in relation to that in the GIO draft?---In the 4, yes. We talk about team leaders and first line supervisor.
PN188
Yes, but in level 3?---Oh, level 3. The senior customer services senior. No, we don't actually refer to supervisors in 3 as such.
PN189
Yes. So it doesn't refer to a supervisory role?---No, not in the sense that we'd understand it today.
PN190
No. Would you say that's a significant difference between the orders?---Well, it's significant in this sense that under the AMP or GIO structure now, supervisors are seen to be - true supervisors are seen to be at the level 4 position. There are other people who can supervise some staff. They might have one or two people and perhaps that's what the FSU is referring to, but certainly now the critical we'd see is the supervisor with a team of - you know significant team of people who report to them. And they have to do performance reviews and so forth would be - would sit in 4.
PN191
Are you aware whether there were ever clearly defined and updated descriptors for the GIO award as a matter of policy or otherwise?---The GIO award has never had - to my knowledge has never had descriptors.
**** DENNIS JOHN WALSH RXN MR SMITH
PN192
Nothing further, thank you, your Honour.
PN193
PN194
MR SMITH: Your Honour, in terms of the suggested approach to today's proceedings, I think we're now at the stage where the FSU would move to outline its case and give their evidence.
PN195
THE SENIOR DEPUTY PRESIDENT: So there's no further evidence?
PN196
MR SMITH: No, only the - no, we've referred to everything we seek to rely upon.
PN197
THE SENIOR DEPUTY PRESIDENT: Thank you. Ms Hannan.
PN198
MS HANNAN: Yes, thank you, your Honour. I'm wondering whether it might be appropriate at this time, before we lead our evidence, that I address you on some changes in the documents.
PN199
THE SENIOR DEPUTY PRESIDENT: Certainly.
PN200
MS HANNAN: Thank you, your Honour. Your Honour, they firstly go to the previously filed FSU1, draft order, and request that it be formally replaced by the order provided to the Commission yesterday. Would your Honour like a clean copy of that order?
PN201
THE SENIOR DEPUTY PRESIDENT: That would be helpful. To be replaced or to be a new document? I mean, FSU1 has already been admitted at the previous proceedings. The current document is clearly a variation from that.
PN202
MS HANNAN: Yes.
PN203
THE SENIOR DEPUTY PRESIDENT: I would have thought the appropriate thing was to incorporate that as a different document, rather than try to expunge FSU1 and put another one in its place.
PN204
MS HANNAN: We would respectfully submit it's appropriate to replace it because your Honour will no doubt note that in part of FSU1 it was incomplete. In the grade section it had a note that existing grades to be added, which was subject to further discussions - - -
PN205
THE SENIOR DEPUTY PRESIDENT: Yes, but FSU1 has already been tendered and marked. It's already an exhibit of the Commission. Are you suggesting that I now throw it away?
PN206
MS HANNAN: No.
PN207
THE SENIOR DEPUTY PRESIDENT: I hardly think that's appropriate.
PN208
MS LEWIS: Your Honour, perhaps it might be more correct to ask the Commission to note that FSU1 is intended to be replaced by FSU whatever.
PN209
PN210
MS HANNAN: I might address the other documents in that vein as well, your Honour.
PN211
THE SENIOR DEPUTY PRESIDENT: Sure. You were going to hand up a clean copy.
PN212
MS HANNAN: Yes, I was, your Honour, but I thought I would do all of the documents in one hit as it were. Your Honour, slight variations were made to the earlier statements filed for both Ms Hawkes and Mr Stevens.
PN213
THE SENIOR DEPUTY PRESIDENT: Yes.
PN214
MS HANNAN: And they were also provided to the Commission. We would also seek to have those marked, if I can take your Honour firstly to the one of Miss Hawkes.
PN215
THE SENIOR DEPUTY PRESIDENT: Yes.
PN216
MS HANNAN: Now, both of those in preparation for the hearing have been formulated in a witness statement form so they are sought to amend and as with FSU4, to be taken in their entirety for the consideration of the Commission purposes for the determination of the matter today/
PN217
THE SENIOR DEPUTY PRESIDENT: Certainly.
PN218
MS HANNAN: Thank you, your Honour. Your Honour, could I just draw your attention, for the purposes of properly informing the Commission, that Ms Hawkes' witness statement was modified at paragraph 17 to reflect that 1500 staff are employed; and again at paragraph 19, that many of the rates are lower. And in Mr Stevens' witness statement, it was modified only at paragraph 8, dealing with those roles at level 5 and above. At point 11, where Mr Stevens' current salary has been inserted. It was omitted at the time this statement was first lodged. And also at point 9, dealing with the issue of AMP rates.
PN219
I stress those amendments on the basis that there has been no other substantive change to those statements that were filed with the Commission in December last year. Mr Smith has also been alerted to those changes.
PN220
THE SENIOR DEPUTY PRESIDENT: Right.
PN221
MS HANNAN: So on that basis, your Honour, if I may respectfully request perhaps that - as I understand your Honour has marked our draft order that we wish the Commission to rely on for FSU as FSU4.
PN222
THE SENIOR DEPUTY PRESIDENT: Indeed.
PN223
MS HANNAN: Your Honour, if I could ask for the other statements to be similarly marked for Mr Stevens and Miss Hawkes.
PN224
THE SENIOR DEPUTY PRESIDENT: Well, given that you say - - -
PN225
MS HANNAN: I'm sorry, I haven't tendered them yet.
PN226
THE SENIOR DEPUTY PRESIDENT: I mean, given that you're saying there's no substantive amendment and they're just, you know, relatively routine corrections, then I think we'll just continue to treat them as FSU2 and 3, won't we?
PN227
MS HANNAN: Perhaps for clarity - and I'm reminded by Ms Lewis that it's appropriate to tender at the time that they're giving their evidence.
PN228
THE SENIOR DEPUTY PRESIDENT: Correct.
PN229
MS HANNAN: So I'll deal with them then and for clarity we will seek that change but I hand your associate FSU4. And, your Honour, the last bundle of documents I would seek to tender concern a letter that was given to an employee, Ms Gamble, at the time that the employees reverted to GIO employment. That's not a contested matter following Mr Walsh's evidence. The relevant transcript - I'm not sure whether Mr Smith has referred to it in his bundle of documents of when the award was first made; and a complete copy of the Insurance Industry Award for the Commission's purposes. I've tagged the relevant sections I'll go to, to assist the Commission, as it's quite a lengthy document, and I request that those documents be marked also.
PN230
MR SMITH: Your Honour, I just might note that the letter to Colleen Gamble, I don't recall seeing that document before. It's just been provided today.
PN231
MS HANNAN: Your Honour, however that document has had a very wide reference to Mr Smith in the certification proceedings. It's not a fresh document and it's not contentious. It simply identifies that persons were with AMP Services and went back to GIO Australia Limited as employees around September. I merely provide it for the Commission's information.
PN232
THE SENIOR DEPUTY PRESIDENT: Are you submitting it as evidence of some sort?
PN233
MS HANNAN: Yes, your Honour.
PN234
THE SENIOR DEPUTY PRESIDENT: How does it come into evidence?
PN235
MS HANNAN: Your Honour, it goes to the overall submissions that have been put as to the reliance by GIO on the AMP structure. If your Honour prefers, I can tender it during Miss Hawkes but I just thought it might be cleaner to have you deal with it now.
PN236
THE SENIOR DEPUTY PRESIDENT: Are either of the people - either the addressor or the addressee going to be appearing as witnesses?
PN237
MS HANNAN: No, they're not, but it's a similar approach that I've adopted here that Mr Smith has adopted by the supplementary statement that we received last night referring to statements made by Mr Wilde who won't be presenting evidence in this case and other members of AMP.
PN238
THE SENIOR DEPUTY PRESIDENT: Yes, but that was attached and formed part of the evidence of Mr Walsh. What I'm really asking is how does this one come into evidence?
PN239
I'm really asking you, you know, what are you wanting to do with this? Mr Smith has said he hasn't seen it before and he hasn't taken it any further than that, but - what do I do with this?
PN240
MS HANNAN: If your Honour will just bear with me. Your Honour, at point 15 in Ms Hawkes' statement, I can deal with it there, if you prefer.
PN241
THE SENIOR DEPUTY PRESIDENT: Okay. That would be a better way to do it.
PN242
MS HANNAN: I would say that there is a chronology of events. I can ask the question as to whether that occurred at that time and I am sure that will be the case.
PN243
THE SENIOR DEPUTY PRESIDENT: In relation to the other documents, they are both documents of the Commission and we don't normally mark our own documents.
PN244
MS HANNAN: I was just trying to keep a sequential order, your Honour.
PN245
THE SENIOR DEPUTY PRESIDENT: I understand, yes. And I think we have had before the transcript of the proceedings before Deputy President MacBean, haven't we?
PN246
MR SMITH: Yes.
PN247
THE SENIOR DEPUTY PRESIDENT: I think we had them previously, but - - -
PN248
MS HANNAN: I've referred to it previously, I think, on 6 November.
PN249
THE SENIOR DEPUTY PRESIDENT: I mean, that is neither here nor there. As I say, it's not practice for the Commission to make its own documents.
PN250
MR SMITH: Your Honour, I think the transcript of proceedings before Deputy President MacBean appears at tab 7 of GIOA3 of the same day, 23 September 1991.
PN251
THE SENIOR DEPUTY PRESIDENT: Yes.
PN252
MR SMITH: Yes, I think you will find it is already in.
PN253
THE SENIOR DEPUTY PRESIDENT: I know I have read it before and I am sure I will read it again.
PN254
MR SMITH: Yes.
PN255
MS HANNAN: It was marked as part of GIOA3.
PN256
THE SENIOR DEPUTY PRESIDENT: Do you want to proceed to call your witness, unless there is anything else you want to cover?
PN257
MS HANNAN: That leaves me with one out of three, your Honour. What did you wish to do with the Insurance Industry Award? Do you wish to receive it?
PN258
THE SENIOR DEPUTY PRESIDENT: Yes. And thank you for handing it up because I need a copy of this one. I know I have previously read it but - thank you.
PN259
MS HANNAN: Your Honour, I would seek to call Mr Stevens.
PN260
THE COMMISSION: State your full name and address, please?
PN261
PN262
MS HANNAN: Mr Stevens, have you prepared a witness statement for the purposes of these proceedings?---I have.
PN263
Would you please state your name and address for the record?---Larry Stevens, 2 Swift Place, Wetherill Park.
PN264
Do you have a copy of that witness statement with you?---Yes, I do.
PN265
And could you please read out the date of that witness statement?---27 March 2003.
PN266
Is that a true and correct statement of the statement that you have prepared?---It is.
PN267
Do you wish to make any alterations?---No, I don't.
PN268
I tender a copy of that statement, your Honour.
PN269
PN270
MS HANNAN: Your Honour, would we not perhaps make - just so I am clear, your Honour, that replaces the earlier one?
**** LARRY GRAHAM STEVENS XN MS HANNAN
PN271
THE SENIOR DEPUTY PRESIDENT: Yes.
PN272
MS HANNAN: Thank you, your Honour. Nothing further at this stage, your Honour.
PN273
THE SENIOR DEPUTY PRESIDENT: Mr Smith?
PN274
PN275
MR SMITH: Mr Stevens, at paragraph 4 of your statement, you say that the majority of GIO staff were then classified at level 1 in the GIO award?---Yes.
PN276
Now, it is true to say that GIO - that level 1 is an entry level classification? Would you agree with that?---Entry level, yes.
PN277
Now, as things stand, the majority of staff at GIO are not entry level now, are they?---I couldn't be sure on that.
PN278
Right.
PN279
THE SENIOR DEPUTY PRESIDENT: Sorry, say again?---I am not sure on that.
PN280
MR SMITH: Well, there is a lot of employees that have worked for a long time at GIO, haven't they?---Yes, there is.
**** LARRY GRAHAM STEVENS XXN MR SMITH
PN281
And they have accumulated experience and knowledge?---I would think so.
PN282
And they are not entry level, are they?---No.
PN283
Mr Stevens, at paragraph 11 of your statement - - - ?---Yes.
PN284
- - - you talk there about being classified into the AMP job family, like, from the GIO award across to the AMP job family. Do you see that?---Yes, I do.
PN285
Now, your job has not changed since November 2002, has it?---I've moved between positions, yes. I had a national role and came back to a state role, but the level hasn't.
PN286
But your classification hasn't changed, has it?---As level 4?
PN287
Yes?---No.
PN288
You are still level 4. Now, you say at paragraph 11 that your current salary is approximately $71,000. Do you see that?---Yes, I do, yes.
PN289
And, in addition to that, you receive superannuation?---No. Superannuation is in that.
PN290
And, in addition to that, you receive bonuses?---I can, yes.
PN291
Are you aware of the minimum rates in the GIO award?---I have seen them.
**** LARRY GRAHAM STEVENS XXN MR SMITH
PN292
Yes. They are substantially less than $71,000, aren't they?---They would be, yes.
PN293
Indeed, the maximum - minimum rate under the award is around 45,000, I think, for a level 9?---I'm not sure.
PN294
Now, paragraph 11 of your statement - sorry, I will take you first - your Honour, I have just noticed as I'm reading through Mr Stevens' statement that it appears to be a repetition of paragraph numbers.
PN295
THE SENIOR DEPUTY PRESIDENT: Yes.
PN296
MS HANNAN: Perhaps if I could deal with that, your Honour. The fourth paragraph from the bottom, if Mr Stevens and the Commission - we would respectfully request that that be changed to 12.
PN297
THE SENIOR DEPUTY PRESIDENT: Oh, okay. So on the last page, you just want to re-number?
PN298
MS HANNAN: Yes.
PN299
THE SENIOR DEPUTY PRESIDENT: Yes.
PN300
MS HANNAN: And following on to 13, 14 and 15.
PN301
THE SENIOR DEPUTY PRESIDENT: Certainly.
PN302
MS HANNAN: It is not a particular skill area of mine - computer work.
**** LARRY GRAHAM STEVENS XXN MR SMITH
PN303
MR SMITH: Hopefully, that will assist us, Mr Stevens. On the last page of your statement - I am now looking at paragraph 13 as we have just changed those numbers. Well, the last - I'll first go to paragraph 13 which states:
PN304
I'm aware that many of those are lower than the ones in the GIO Award.
PN305
Can you see that?---Yes, I can.
PN306
And then down on the last paragraph, you speak there about:
PN307
Further, GIOs proposal does not provide for a fair basis that minimum rates will apply. In fact, its adoption would result in the reduction of many current award rates.
PN308
Do you see that?---Mm.
PN309
Are you aware that it's GIOs proposal that employees as at 23 July 2002 would retain their current award minimum rates?---No, I'm not, no.
PN310
Are you aware that the GIO level 4 minimum rate, which is enclosed - sorry, I'll start that again. Are you aware that the new level 4 minimum rate of pay proposed by GIO for employees who have commenced after 23 July 2002 is in fact higher than what the FSU is proposing?
PN311
MS HANNAN: Your Honour, I just have an objection there. Maybe - or a clarification rather. Perhaps it would assist the witness if he could be provided with a copy of GIOs order.
PN312
THE SENIOR DEPUTY PRESIDENT: Yes.
**** LARRY GRAHAM STEVENS XXN MR SMITH
PN313
MR SMITH: Look, I'm happy to do it that way. I was trying to get to the end sooner, your Honour, but it hasn't worked. If I may provide the witness with a copy of GIO4 and also - yes, that would assist.
PN314
Now, Mr Stevens, you're a level 4 under the AMP classification structure, aren't you?---Yes.
PN315
Yes. Now, if I take you to FSU4, and if you look at the table in paragraph 14.2, which is on the second page of the draft order, and if you go down the first column until you reach level 4, now can you see across - if we go across two rows, under the heading Minimum Rates Including 1999 Safety New Adjustment dollars per annum, you'll see that it reads for a level 4, 36,349. Do you see that?---Yes, I do, yes.
PN316
Yes. Now, can I take you to GIO4, and if you go to paragraph 14.2, and you'll see in the same place, that is, the bottom row, middle column, the minimum rate there proposed for a level 4 is 36,707.20. Do you see that?---Yes, I can, yes.
PN317
It's a higher rate, isn't it, than what's proposed in the FSU award draft order?---It would appear so, yes.
PN318
And then if you look similarly at the bottom column, in column 5?---Yes.
PN319
I think we started with the GIO order first, since you're looking at that, you'll see those numbers there. They start at 38,000 and increase up until 45,000. Do you see that?---Yes, I can.
PN320
Now, if you go across to the GIO award, which is marked FSU4, and if you'll see column 4, level 4 employees. Can you see that?---Yes, I can.
**** LARRY GRAHAM STEVENS XXN MR SMITH
PN321
Those rates commence at 32,000 and then they move up to 35,000. Those numbers are lower than what's set out in the GIO order, aren't they?---Yes.
PN322
So there's no reduction in the minimum rates of pay for level 4 employees under the GIO order, is there?---It would appear not.
PN323
Mr Stevens, you've been offered management terms, haven't you?---I'm on management terms at the moment but - - -
PN324
That's right. You accepted those terms in November 2000?---I did, yes.
PN325
Yes. Nothing further, thank you, your Honour.
PN326
PN327
MS HANNAN: Mr Stevens, can I just take you back to point 4 of your statement. Can I clarify that when you indicate there that:
PN328
The majority of GIO staff were then classified at level 1 -
PN329
do you mean at level 1 in the old - in the GIO award 1991?---I do, because the level 1 was the terminology, then layer. They talk about layers these days.
PN330
Yes, thank you. And could I take you to FSU4, and would it be true to say that that level would now be found at the proposed level 2 in FSU4?---Level 1 would. I'm not sure of your question.
**** LARRY GRAHAM STEVENS RXN MS HANNAN
PN331
Yes, you indicate at point 5 that:
PN332
The indicative jobs at level 1 was customer service roles, phone inquiries staff -
PN333
etcetera. Would it be true to say that those levels will now be found in the proposed level 2 in FSU4?---I would believe so, yes.
PN334
THE SENIOR DEPUTY PRESIDENT: Excuse me. Is that looking at 14.2 or 14.1, when you say looking at FSU4 - - -
PN335
MS HANNAN: They're descriptors in 14.1, your Honour.
PN336
THE SENIOR DEPUTY PRESIDENT: Thank you, yes.
PN337
MS HANNAN: Mr Stevens, is it your wish to have an updated GIO award classification structure - to update the GIO award structure?---Yes.
PN338
Thank you. Can I just take you back to FSU4 at level 4. You see there that at level 4 it's proposed to incorporate the three rates as identified in the last column in column 5 down the bottom?---I can see that, yes.
PN339
And that in table 2 there are existing level 6 to 9 grades that have been updated for the '99 safety adjustment?---Yes.
PN340
Nothing further, thank you, your Honour.
PN341
PN342
THE SENIOR DEPUTY PRESIDENT: Yes, if I could get back the FSU4 document, that would be good, thank you.
PN343
MS HANNAN: Your Honour, I would seek to call my next witness, Ms Linda Hawkes.
PN344
THE COMMISSION: State your full name and address please.
PN345
PN346
MS HANNAN: Ms Hawkes, could you please state your name and address?---Linda Louise Hawkes - - -
PN347
I'm sorry. You've already done that. I beg your pardon?---You're right.
PN348
Have you prepared a statement for the purposes of these proceedings?---Yes.
PN349
Do you have a copy of that statement with you?---Yes.
PN350
Could you please identify the date on that statement?---It's dated 27 March 2003.
PN351
And that is a true and accurate record of the statement you have prepared?---Yes.
PN352
Do you wish to make any alterations?---No.
PN353
I seek to tender a copy of Ms Hawkes' statement which I understand your Honour would replace - - -
PN354
THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. That's marked as FSU2.
PN355
MS HANNAN: FSU2 - and on a similar basis to Mr Stevens. Nothing further at this stage, your Honour.
PN356
**** LINDA LOUISE HAWKES XXN MR SMITH
PN357
MR SMITH: Ms Hawkes, at paragraph 11 of your statement, the last sentence you state that level 5s were subsequently offered management contracts?---Yes.
PN358
Can you see that? Management contracts - they're not restricted to level 5 employees, are they?---I don't believe so.
PN359
No. They can be offered to employees at any level, in theory, can't they?---I don't know about the theory. All I know is that the people that I know that were offered contracts were level 5 and higher.
PN360
Now, if I can take you to paragraph 14. Can you see you state there that there was no analysis about jobs as GIO employees? Are you aware that there was a project team set up for that purpose?---I am now because I've read Mr Walsh's statement. I wasn't at the time.
PN361
Right. So in Mr Walsh's statement, he sets out in some detail the process that was followed in evaluating the jobs. Were you aware that the project team undertook extensive interviews and questionnaires?---No.
PN362
No. Are you aware in some instances employees that were interviewed by the project team were representatives of the FSU?---I have no awareness of any of that. Nobody that I worked with was involved in it and I didn't even know that it had happened. That's why I've made the statement that no analysis of our jobs was undertaken because that's the way it appeared to me.
PN363
Yes. At paragraph 15 of your statement, in the last sentence, you say that the salary that you received fell into the range between 55,000 and 66,000?---Yes.
PN364
Is that November 2000 you're speaking of there or - - -?---Yes - at the end - - -
**** LINDA LOUISE HAWKES XXN MR SMITH
PN365
It is?--- - - - the classification process.
PN366
Yes. And since that time, has your salary increased?---Yes.
PN367
Yes. Are you able to estimate what your salary may be now?---68,600.
PN368
Right. And in addition to that, you receive superannuation?---Yes.
PN369
Yes. And potentially bonuses?---Yes.
PN370
Now, if we look at paragraph 22 now. You see the last sentence - you assert there that the draft order proposed by GIO would result in a reduction of current award rates. Do you see that?---Yes.
PN371
Ms Hawkes, I'd just like to show you the draft orders that are currently before the Commission. Ms Hawkes, you now have a copy of a draft order marked GIO4?---Yes.
PN372
Yes. That's the GIO draft order. And you also have a copy of a draft order marked FSU4?---Yes.
PN373
Yes. That's the FSU draft order. Now, you currently are a level 3 under the AMP GIO agreement?---Yes.
PN374
Yes. Now, if we go to the FSU draft order and turn to the second page, and you'll see a table at 14.2?---Yes.
PN375
Now, if you go down the first column, which are the proposed new grades for the GIO Australia award 2002, you'll see level 3. Can you see that?---Yes.
**** LINDA LOUISE HAWKES XXN MR SMITH
PN376
Yes. Now, if you go across to the third column, you'll see a minimum rate for including the 1999 safety net adjustment and there's a figure there of 31,382. Do you see that?---Yes.
PN377
Yes. And then if you go to the fifth column, you'll see two figures, 30,862 and 31,560. Can you see that?---Yes.
PN378
Yes. Now, do you understand that those figures in the fifth column to be the minimum award rates sought by the FSU - - -?---No, that's - - -
PN379
- - - or a level 3 employee?---That's the figures in the third column, the one headed Minimum Award Rates.
PN380
Yes. But if you go - if you turn over the page to paragraph 14.2.4, you'll see a paragraph there. Could you read that please?---
PN381
An employee whose employment commenced prior - - -
PN382
To yourself is fine, thanks. That's okay?---Okay. I've read it.
PN383
I'm sorry about that. And you will see that FSU have it that an employee employed after 23 July would be paid at the higher of either the minimum rate or the total contained in column 5. Do you see that?---Yes.
PN384
Now, if we go to the GIO draft order and we look at paragraph - on the second page, table at 14.2, and we look at the corresponding figures at column 5 for a level 3 employee, you will see those figures there of 32,635 and 35,829. Now, those amounts - they're higher than what the FSU is proposing, aren't they?---For people employed after that date, yes.
**** LINDA LOUISE HAWKES XXN MR SMITH
PN385
Yes. Sorry, your Honour, I'm almost completed.
PN386
Are you aware in the GIO order that the rates in column 5 are expressed to be the minimum rates that will apply to employees who were employed before 23 July 2002?---Are you referring to paragraphs 14.2.2 and 2.3?
PN387
Yes, I am?---Well, yes, I can read it; that's what it says.
PN388
Yes. And you were employed prior to 23 July 2002, weren't you?---Yes.
PN389
So the minimum rate that would apply to employees at your classification level under the GIO proposal, that were employed prior to 23 July 2002, are those rates in the fifth column; 32,635 and 35,829. Do you agree with that?---Are you asking me or telling me?
PN390
I'm asking you. Do you agree with that?---If I continued to be classified at level 3, then yes.
PN391
Yes. Now, those rates are higher than the minimum rates set out in column 3 for level 3 employees in the FSU order, aren't they?---Yes.
PN392
So would you agree with me that the GIO order at least with respect to level 3 employees, of which you are one, employed before 23 July 2002, would receive a higher minimum rate under the GIO proposal than what has been proposed by the FSU?---Yes.
PN393
No further questions, your Honour.
PN394
THE SENIOR DEPUTY PRESIDENT: Thank you. Ms Hannan?
**** LINDA LOUISE HAWKES XXN MR SMITH
PN395
PN396
MS HANNAN: Ms Hawkes, could I just take you to point 15, which Mr Smith has referred to, of your witness statement?---Yes.
PN397
You set a chronology there of different times when you were employed by AMP through to GIO. Can you indicate the last time that you were transferred back to GIO employment?---Before the sale to Suncorp I believe.
PN398
Would it be fair to say that would be around September - - -?---September.
PN399
- - - 2001?---Yes.
PN400
Can I also take you to FSU4 and you prepared - in your statement, you've indicated that a number of classifications existed at the time that the GIO Award 1991 was made. And you've indicated where you believe those jobs would now fit in the proposed FSU4 order. Do you have that FSU draft order there?---Yes.
PN401
Do you agree that at level 3, there is a supervisory role there for a senior customer service officer?---Yes.
PN402
Thank you. Is it your desire to see the present GIO Award classification structure updated?---Yes.
PN403
Do you see that the proposed structure as outlined in FSU4 is the most relevant structure as opposed to the AMP structure?---Yes.
**** LINDA LOUISE HAWKES RXN MS HANNAN
PN404
Would you say or would you be of the view that there has been a considerable level of disputation in the GIO - for the GIO company in the last 15 months?---Yes.
PN405
Would you say that there is some uncertainty concerning the future direction of employment conditions?---Yes.
PN406
If I can just take you back to GIOA4, do you see there that in level 4 that the company's proposal is seeking to contain the existing GIO Award levels at 6 to 9 at level 4?---Yes.
PN407
And that that would result in a considerable compression of the rates?---Yes.
PN408
If I could just ask you to go back to FSU4, Ms Hawkes. If I can just refresh your memory at 14.2.3 that there is an existing provision in the GIO Award that provides - and I mean I can show it to you if you wish - that provides for persons who are on a remuneration package contract to effectively to be exempt as long as the provisions don't fall below the award levels. Do you agree with that?---Yes.
PN409
All that? You see there in table 2 that it refers to the current level 6 to 9 in the GIO Award as updated by the 1999 safety net adjustment?---Yes.
PN410
And can you see by going through the comparison of FSU4 to GIOA4 that the amounts proposed by FSU in levels 1 through to 3 are higher than those contained in GIOA4?---Yes.
PN411
And you agree that in table 2 the inclusion of that table has been included to give proper effect to clause 14.2.3 when it talks about the remuneration package contract?---Yes.
**** LINDA LOUISE HAWKES RXN MS HANNAN
PN412
We have nothing further.
PN413
THE SENIOR DEPUTY PRESIDENT: Ms Hawkes, you have just responded "Yes" to a question from Ms Hannan which directly contradicts evidence that you gave in the final two questions from Mr Smith?---No. Ms Hannan was referring to the minimum rates in column 3; Mr Smith concentrated on the rates in column 5. Is that the point that you mean?
PN414
I am not sure what to do with your answer because Ms Hannan asked a very broad questions to which you answered "Yes". You'd also agreed with very particular propositions that Mr Smith put to you?---Well, my intention in answering it was in reference to the rates in column 3. Does that clarify it for you?
PN415
So which rates were you referring to in column 3?---The two column 3s in the two documents.
PN416
Yes?---The rates are lower except for the level 4 one where there is a $400 roughly discrepancy.
PN417
Sorry, the rates in which one?---The rates in the FSU4 document are lower than the rates in the GIO document.
PN418
So, in other words, you are saying the rates in the GIO draft in column 3 are higher?---No.
PN419
MS HANNAN: Your Honour, would it assist if I re-put that question?
PN420
THE SENIOR DEPUTY PRESIDENT: Yes, it would. I am not sure what to do with the evidence.
**** LINDA LOUISE HAWKES RXN MS HANNAN
PN421
MS HANNAN: Fair enough.
PN422
Ms Hawkes, can I take you to both FSU4 and GIOA4? Do you have those in front of you?---Yes.
PN423
Okay. In terms of column 3 in FSU4, would you agree that the rates that exist in FSU3 as compared to those rates proposed in GIOA4 levels 1 to 3 are higher?---Yes.
PN424
Does that clarify, your Honour?
PN425
THE SENIOR DEPUTY PRESIDENT: But it is not true. If you look at GIO4, the rate for a level 4 is higher than in FSU4?---Ms Hannan just clarified that, your Honour, with level 3. The question I answered - - -
PN426
MS HANNAN: Your Honour, my question did go to levels 1 to 3.
PN427
THE SENIOR DEPUTY PRESIDENT: Sorry, I misheard in that case.
PN428
MS HANNAN: Your Honour, if I just may be permitted just one final question.
PN429
Ms Hawkes, you indicated before that you agreed that there had been a significant level of uncertainty about your future employment conditions at GIO - about employment conditions at GIO?---Yes.
PN430
And that would apply to a number of issues including appropriate matters of addressing an award to management employees?---Yes.
**** LINDA LOUISE HAWKES RXN MS HANNAN
PN431
Thank you. Nothing further, your Honour.
PN432
THE SENIOR DEPUTY PRESIDENT: In that case, Ms Hawkes, you are - just one final question. Let me clarify. There is a four-level structure in operation at the moment, is that right?---Not in the award. The four-level structure comes from the enterprise agreement underlaid by the AMP award, not the GIO award.
PN433
But you current work in a four-level structure?---Yes.
PN434
PN435
MS HANNAN: We were just discussing, your Honour, to what time did your Honour intend to sit today?
PN436
THE SENIOR DEPUTY PRESIDENT: Until we finish.
PN437
MS HANNAN: In that case, your Honour, with Mr Smith's agreement, and subject to your approval, we were just wondering if we could have a brief five minute adjournment to go over the evidence that has just been led for the purposes of our final submissions?
PN438
THE SENIOR DEPUTY PRESIDENT: Certainly. Before you do, the last discussion raises a question that I wanted to ask Mr Smith. In the draft order, at level 2, there are two rates in GIO4 for column 3. Can you help me understand what is intended there?
PN439
MR SMITH: Yes, your Honour.
PN440
THE SENIOR DEPUTY PRESIDENT: FSU4 has one rate which, on the face of it, is the minimum rate for that level. How is it that the GIO table has two rates expressed as the minimum rate for the same level?
PN441
MR SMITH: Your Honour, the level 1 thereafter rate in the former GIO Australia Award 1991 was an entry level adult rate. At the time of transitioning employees from the award across to the four-level agreement structure, a number of employees were still at the level 1 thereafter rate and they transitioned across to level 2. So what we have sought to do in our table is to reflect that actuality, that is, that people transferred from level 1 thereafter to a level 2 under the AMP/GIO agreement.
PN442
Now, we've set - the rate in the fifth column is the actual rate in the award for level 1 thereafter, 22,905, and the column 3 minimum rate reflects what we would say is an appropriate percentage of what would otherwise be the bulk of employees in level 2. If we were to have the level 1 thereafter set out in level 1, it would suggest, incorrectly, that level 1 thereafter people transitioned across to level 1 in the AMP/GIO agreement which is not the case.
PN443
THE SENIOR DEPUTY PRESIDENT: So you are saying that in the old structure - in the nine-level structure that is contained in appendix A, that level 1 really has two streams. It is level 1 as an entry level for quick passage through the classification structure, but there were also people who were permanently in level 1, in other words, they were not transitioning to another part of the classification structure?
PN444
MR SMITH: Look, I - - -
PN445
THE SENIOR DEPUTY PRESIDENT: Perhaps I have asked this out of turn. I should perhaps be more appropriately when you are making submissions, but it was the evidence of Ms Hawkes which focused my mind on it to say, well, how is it that there are two rates proposed in that minimum rate. So, given that Ms Hannan has asked for a short adjournment to review the evidence, maybe it is better to put you on notice that that is a subject that I want to ask you about.
PN446
MR SMITH: Look, I can further respond to that.
PN447
THE SENIOR DEPUTY PRESIDENT: Okay. 10 minutes enough? We will adjourn for 10 minutes.
SHORT ADJOURNMENT [3.49pm]
RESUMED [4.03pm]
PN448
THE SENIOR DEPUTY PRESIDENT: Yes.
PN449
MS HANNAN: Your Honour, just before - at your convenience - Mr Smith commences, might I take this opportunity just to refer you to FSU exhibit 4. What has emerged is an error at 14.2.4 as relating to table 2.
PN450
THE SENIOR DEPUTY PRESIDENT: Yes, I think you've got it around the wrong way, haven't you?
PN451
MS HANNAN: If I could just perhaps put your Honour on notice about it at the moment and I'll address it when it comes time for my submissions.
PN452
THE SENIOR DEPUTY PRESIDENT: Right.
PN453
MS HANNAN: Thank you.
PN454
MR SMITH: Your Honour, in further response to your question just before we took our short break, Mr Walsh has reminded me that one of the features of the level 1 thereafter classification was that there were adult employees in that classification who attracted qualification allowances and that created some higher rates of pay for them.
PN455
THE SENIOR DEPUTY PRESIDENT: So is that what the "thereafter" is meant to refer to?
PN456
MR SMITH: Yes, your Honour, because in the original award there was effectively junior or age based rates, that is, there were specific rates of pay for people aged between 16 and 21 and then thereafter. Now, in Mr Walsh's first statement, which was marked GIO2, at paragraphs 10 and 11, he gives some background to how that level 1 operated and how people could potentially proceed on two parallel paths, that is, in relation to their educational and skill qualifications versus reference to the positions they actually occupied at GIO.
PN457
THE SENIOR DEPUTY PRESIDENT: And is it also in GIO2 that Mr Walsh says the parties don't wish to have junior rates or was that in your outline of submission? I've forgotten which.
PN458
MR SMITH: It's certainly in the outlines of submission, your Honour, and on my instruction, it's certainly the position of the company.
PN459
THE SENIOR DEPUTY PRESIDENT: Sorry, I may have diverted you. Please carry on with the point you were making.
PN460
MR SMITH: Yes. If it would assist the Commission, I'm instructed to say this: that if there was to be, arising from your Honour's question, any amendment to the proposed order from GIO in GIO4, that that amendment would be confined to setting an appropriate minimum rate in column 3 for level 2 in table 14.2 of the draft order. But the reference to level 1 thereafter corresponding to the level 2 would stay, and that the total in column 5 of 22,905 should stay as well, which is the existing award rate for a limit on thereafter.
PN461
THE SENIOR DEPUTY PRESIDENT: Right. It seems a bit of a contradiction in terms, doesn't it, to have a table that says minimum rate for level 2 but then to have two rates?
PN462
MR SMITH: Yes, your Honour. We're grappling with this absence of descriptors and then this historical anomaly that people could attract at level 1 thereafter, higher rates of pay because of qualifications they held as opposed to the positions that they occupied.
PN463
THE SENIOR DEPUTY PRESIDENT: Yes, but it's your submission, isn't it, that those - I think they're described as loadings, aren't they? It's just a word in my grasp at the moment.
PN464
MR SMITH: Loadings, yes.
PN465
THE SENIOR DEPUTY PRESIDENT: It's your submission, if I recall, that they're obsolete.
PN466
MR SMITH: That's right.
PN467
THE SENIOR DEPUTY PRESIDENT: And so - I mean, I understand the point you make but isn't that relevant to column 5 rather than to the submissions you're making about column 3? In other words, if you're submitting that those things are obsolete and wouldn't be part of the strategy going forward - - -
PN468
MR SMITH: Yes.
PN469
THE SENIOR DEPUTY PRESIDENT: - - - then what would the minimum rate in column 3 be on your submission? In other words, you know, if your proposition is that those loadings are obsolete, then almost by definition they're restricted to apply only in column 5.
PN470
MR SMITH: Yes. Perhaps if I approach it another way. Level 2 is the level at which the company, if it were to recruit, would anticipate that it would recruit at that level. It's difficult for the company to envisage that it would ever recruit into level 1 in the future. So it would be that the level 2 rate would need to accurately reflect that it's an entry level rate. So your Honour would have to set an appropriate minimum rate that would catch an adult entry level.
PN471
THE SENIOR DEPUTY PRESIDENT: And in your submission, which of the two figures you're proposing is that rate or perhaps it's another rate.
PN472
MR SMITH: Well, your Honour, we would - in our submission, we would say that the $22,562 would represent an appropriate entry level rate given that that would, we say, be appropriate for an employee who occupied the level 1 thereafter.
PN473
THE SENIOR DEPUTY PRESIDENT: Yes, thank you.
PN474
MR SMITH: Your Honour, I might only make one more comment about this point before leaving it, which is, I'm reminded on my instructions, that there are employees who occupy level 2 positions whose rates of pay would be less than $29,000 but higher than the 22,905 in column 5. So your Honour would have to guard against any amendment to the order which would result in rates of pay in column 5 that didn't include that 22,905 figure.
PN475
THE SENIOR DEPUTY PRESIDENT: I see.
PN476
MR SMITH: Which could potentially give an unintended rate higher than what currently applies to employees today which of course is not the intention of an awards identification process. We've tried hard to best reflect what we understand to be the actuality of the experience of those employees, but it hasn't been a straightforward exercise. I'd acknowledge that, your Honour.
PN477
THE SENIOR DEPUTY PRESIDENT: I think if I recall correctly, Ms Hannan, we struggled with the same issue on the AMP award, didn't we?
PN478
MR SMITH: So if I can only emphasise that any adjustment - and the focus of adjustment should be in relation to the column 3 for level 2, an appropriate set minimum rate. But the remaining references for level 1 thereafter should remain. Excuse me, your Honour. Your Honour, in making submissions I propose to take the Commission to GIO1, which is an outline of submissions of GIO Australia Limited. I propose to step the Commission through some of the salient and relevant points of that submission and make a number of comments in relation to the evidence that the Commission has now heard and make a number of comments, given the draft orders which are now before the Commission. Your Honour, if I can start - - -
PN479
THE SENIOR DEPUTY PRESIDENT: I - I did re-read those yesterday, by the way, so - - -
PN480
MR SMITH: You have. Yes. Okay.
PN481
THE SENIOR DEPUTY PRESIDENT: So you don't have to go through it all.
PN482
MR SMITH: Yes. Thank you, your Honour. At paragraph 3 on page 4, we set out some of the GIO award history. Now, I understand that it's common ground between the parties that the award has never been subject to the minimum rates adjustment process. We set out at paragraph 3.9 a number of comments that highlight when the award has been varied and for what purposes to buttress this notion that the minimum rates adjustment hasn't occurred, and a review of the transcript of the making of the award we would say also supports this construction.
PN483
Armed with the knowledge that the award has never been subject to a minimum rates adjustment, we then turn to the paragraph 4 of our submission, which is headed "Whether the GIO award requires review under item 51(4)". And we say that the first step is to determine whether or not the rates of pay in the GIO award require a review under item 51(4) of the WROLA Act and the principles set out by the Commission in the paid rates review decision, which is tab SM5 of GIO3 and the paid rates supplementary decision, which is also contained at SM10 of GIOA3.
PN484
Now, as a result of the proper application of those principles, and in particular what we would say is the proper application of principle 1 of the conversion principles contained within the paid rates review decisions, is that an award would require a review under item 51(4) if they had not been adjusted in accordance with the minimum rates adjustment principle or had been adjusted since that time other than for safety net increases or pursuant to the work value change principle.
PN485
We conclude, at paragraph 14.5, that the GIO award has not been subject to a minimum rates adjustment; that GIO relies on material including the Commission transcript of the making of the GIO award at tab SM7 of GIOA3; the award history at tab 9 of GIOA3; and the evidence contained in the statements of Dennis Walsh in support of his contention; and he also rely on the acknowledgment of the FSU in transcript previously which I have referred to in my outline of submissions - oral submissions today.
PN486
Your Honour may recall that on a previous occasion the FSU made some submissions as to the application of item 51(4) to be read against other particular items within the WROLA Act which meant that - I think on their submission, that the absence of a minimum rates adjustment didn't give rise to a need to necessarily review the award, as I tried to - the company doesn't accept that approach and says that it's clear that once you read item 51(4) against the conversion principles, the absence of a minimum rates adjustment give rise to the need for a review - and that's the approach that this Commission should take.
PN487
Now, we move to paragraph 5 of properly fixed minimum rates and we say that principle 2 of the conversion principles requires the Commission to examine the wage rates in the GIO award to assess whether they equate to properly fixed minimum rates in other awards. In relation to this step, the existence of already simplified relevant industry awards, which contain properly fixed minimum rates, provide guidance as to the appropriate level at which minimum rates for the GIO award should be fixed.
PN488
Now, we point to the industry award and the AMP employees award 2000 as - too, as being relevant simplified awards for the purposes of comparison with the GIO award and in support of this contention, we note that GIO was an AMP Group company prior to being acquired by Suncorp Metway Limited in September 2001 - and that both GIO and AMP are named as parties bound to the AMP/GIO Enterprise Agreement 2000.
PN489
Now, you heard today confirmation from Mr Walsh in his evidence that both Suncorp and GIO have undertaken to continue to apply the AMP/GIO agreement to employees at GIO until such time as that agreement is replaced by another agreement. I apprehend that the FSU is placing some weight on the amount of time that employees were actually employees of AMP and saying that, given that that was such a relatively short period of time, that it would give undue weight to rely too heavily on the AMP classification structure that was applied for employees at that time.
PN490
We would say that what is ignored by the FSU in making that submission is the classification system established by AMP which continues to apply and is in place at GIO now. So it is not as if that classification system was something that only was there for nine months and has now gone. It is something which continues in place and as a matter of practical industrial reality, it is the classification system which applies to these workers at GIO as this Commission considers the award simplification process.
PN491
Indeed, it is that AMP and GIO share some common history concerning the regulation of wages and conditions of employment, of employees performing comparable work, and most in particular, the four-level classification structure which is contained in the AMP agreement is currently applied at both AMP and GIO. We also note your Honour's decision in print number PR918851 which related to simplification of the AMP award. That decision was dated 13 June 2002 and, at paragraphs 15 and 27, your Honour held that the industry award was most relevant to the simplification of the AMP award.
PN492
So it is not as if what has occurred at AMP has occurred regardless of what may be the situation in the industry award. Indeed, to the contrary. The Commission has had regard to that.
PN493
In paragraph 6 of our submission, your Honour, we turn to the classification structure and we note that item 51(8) requires the Commission to take whatever steps it considers necessary to facilitate the variation of the GIO award so that it meets the criteria set out in sub-items 51(6) and 51(7). The criteria requires that the GIO award does not contain provisions that are obsolete or need updating. Now, a review of Mr Walsh's evidence will identify in GIO2 at paragraph 7 and 8 the number of positions which are contained within the award which are obsolete. Paragraph 7 lists those out. By way of example, I read a couple of them - assistant librarian, building inspector and the list goes on. Those positions on the evidence are obsolete. It is not contested as I understand it.
PN494
Now, as your Honour is aware, as part of the AMP award simplification, the former seven-level AMP award classification structure was replaced with the four-level classification structure in the AMP/GIO agreement. Now, that is the very same classification structure which is applied to employees at GIOA. It is submitted that the GIO award should also be simplified by replacing that nine-level award structure with the four-level classification structure in the AMP/GIO agreement for similar reasons. Now, the rationale for that change in classification structure includes that the nine-level GIO award structure is outdated and no longer used.
PN495
Importantly, the GIO award fails to include any definition of the employees or work contemplated by the nine-level structure. There is, as has been noted repeatedly in this process, there are no descriptors.
PN496
The relevant employees at GIO are now employed within a four level broad band of classification structure. It's not proposed to return to the nine level GIO award classification structure and that observation can be found in Mr Walsh's evidence, and it's also said that a proper reading of item 51(7)(D) and item 51(8) require the GIO Award structure to be updated.
PN497
Now, your Honour, we've had some discussion already about level one in the nine level GIO Award structure, and that it includes a seven year incremental scale. We submit that incremental scale has no basis in work value; it's based in age. Accordingly, pursuant to principle 8 of the conversion principles, it's submitted that the incremental scale is not allowable, should be removed from the award. I note to that extent there appears to be no dispute between the parties. Again, I note that in addition to the nine level classification structure of the GIO award it also contains certain specified positions. GIO has either ceased to employ people in those positions, or has incorporated the positions into the four level broad banded classification structure in the AMP/GIO agreement. Therefore, these positions as identified in Mr Walsh's evidence, are obsolete and should be removed from the award.
PN498
In section 7 of our submission, we deal with the wage rates. In this section consideration is given how to properly fix minimum rates should be applied to the proposed new classification structure. It's noted with emphasis that the four level classification structure contained in the AMP Award, which is the same classification structure GIO submits, should be inserted into the GIO Award, has properly set minimum rates recently determined by the Commission. When your Honour reviews the descriptors in the proposed GIO Award as compared to the descriptors in the AMP/GIO agreement and the descriptors in the AMP Award, your Honour will note that in our - what we say, in our submission - is no practical or significant difference to the extent that your Honour will note any differences, we would say that it would be by way of identifying with some particularity the types of jobs at GIO that would fall within those particular job types, and the only other differences would be deleting references to some jobs which don't exist at GIO. For instance, I think tele-sales is not included.
PN499
Another example of why there is distinctions is your Honour will note that there is a reference to motor vehicle assessors in the GIO proposed order. I understand, on my instructions, that that classification of work is not found at AMP; it's a distinction between the employ entities. It's reflected in the orders. We would say the principle three of the conversion principles requires that fixation of appropriate minimum rates should be achieved by making a comparison between the rates, the key classification of the GIO award, with rates for appropriate key classifications in awards which have been adjusted in accordance with the 1989 approach.
PN500
Now, in the absence of definitions and descriptors for each of the nine levels in the GIO Award, it's submitted that the key classification cannot be readily identified. However, we do say that in relation to the new four level structure contained in GIO4, it is submitted that a key classification can be identified, and that that can be done by way of comparison with the AMP Award, which has properly set minimum rates following the conclusion of an award classification process.
PN501
THE SENIOR DEPUTY PRESIDENT: So on what basis do you say that level two is the key classification? Simply that it's the most populous point being the entry point, or is there some other basis?
PN502
MR SMITH: We would say, certainly, for that reason, that it is an entry point. It is a relatively populous level on my instructions and we would also say on our observation of the minimum rates set in the AMP Award, as read against the C10 in the metal fitters, as at 1999, the rate of pay seems to us to capture that 100 per cent point. So, by way as a matter of logic, if level two at GIO and level two in the AMP Award, as a result of their histories which we have just traversed, are sufficiently identical, that that feeds us into this notion that that rate of pay must represent the appropriate 100 per cent point, as it also ties in with a review of C10 as at 1999 in the Metals Award.
PN503
We emphasis at paragraph 7.8, having observed that the purpose of the minimum rates adjustment principle is to remove inconsistencies between award rates, that the AMP Award covers employees performing comparable work, contains the same classification structure, and properly sets minimum rates and it's appropriate to have regard to the AMP Award for guidance as to the appropriate level of which minimum rate for the GIO Award should be fixed.
PN504
In paragraph 7.9 we note the draft order incorporates classifications and rates which are consistent with the classifications and properly set minimum rates in the AMP Award, which in turn was set with reference to the industry award, and that last part of that sentence, the reference to the industry award, I make that submission with some emphasis, because I note that it's one of the concerns of the FSU that somehow, as we understand their submission, that the company has gone about this process without sufficient regard to the industry award. We say that submission is flawed on a proper analysis. The material that we've gone to includes reference to the industry award and we would say is the most relevant to guide the Commission in this process as descriptors in the award.
PN505
As already noted GIO4 does not include junior rates of pay. The company does not propose to set rates of pay by reference to an employee's age. It's also submitted that the insertion of junior rates would not serve to protect the competitive position of young people in relation to prospective employment at GIO. We also note that the wage rates in the draft order, GIO4, also account for safety net adjustments, up to and including the 1999 adjustment.
PN506
THE SENIOR DEPUTY PRESIDENT: Can I just take you back to junior rates for a moment?
PN507
MR SMITH: Yes.
PN508
THE SENIOR DEPUTY PRESIDENT: Under item 51C, that's an issue that the Commission must also review, and so it's your submission, is it, that it's not - what I hear you putting is that it's not appropriate to include junior rates because they're not currently used and it's not the intention of GIO to sue them? Is that what you're saying?
PN509
MR SMITH: Well, that's certainly true, your Honour, but the additional submission and perhaps the more powerful one, would be that the principles would require incremental junior rates to be removed from the award.In the circumstances we would say that there is no advantage to young people in terms of retaining these.
PN510
THE SENIOR DEPUTY PRESIDENT: Yes, well, I mean presumably it would be possible to separate the question of incremental rates and junior rates, but, you know, I'm looking at item 51(7).
PN511
MR SMITH: Yes.
PN512
THE SENIOR DEPUTY PRESIDENT: And that sets out a number of criteria which the Commission must also review. Well, it says:
PN513
The Commission must also review the award to determine whether or not it meets the following criteria -
PN514
And then one of those criteria is:
PN515
If it applies to work, if it is only performed by young people, it protects the competitive position of young people at a local market -
PN516
etcetera.
PN517
MR SMITH: Yes.
PN518
THE SENIOR DEPUTY PRESIDENT: And you're essentially putting a submission, if I understand you correctly, that it would not be appropriate to specifically include junior rates in this award.
PN519
MR SMITH: That's right, your Honour.
PN520
THE SENIOR DEPUTY PRESIDENT: Okay.
PN521
MR SMITH: Your Honour, in my opening oral submission I made a number of observations about the draft orders. If I could make a couple of additional comments in relation to FSU4. In the scheme of things a relatively minor point but, for completeness, your Honour, the FSU reference in 14.1:
PN522
That employees shall be employed in accordance with the following classification structure -
PN523
and then the words -
PN524
and in accordance with appendix A to this award.
PN525
THE SENIOR DEPUTY PRESIDENT: Yes. I've noted.
PN526
MR SMITH: There would be no appendix A if the award was completed.
PN527
THE SENIOR DEPUTY PRESIDENT: I've noted that. Yes.
PN528
MR SMITH: In relation to the descriptors proposed by the FSU, we would say that, whilst there may be some superficial commonality between the descriptors, that the descriptors described in GIO4 are preferable, because they are better expressed with greater clarify as to their meaning and, also, because they more accurately reflect the verbiage that currently applies at GIO and which also applies in the relevant - in the most relevant industry award, being the AMP Award. The reference in FSU4 at level 3 to including a supervisory role we would say is unsupported on the evidence, having regard to what Mr Walsh had to say in relation to that, and also having regard to a review of that classification descriptor in the AMP GIO award, and within the AMP award.
PN529
In relation to table 14.2, I make a couple of observations. There was evidence given today by the FSU witnesses that level 1 of the former GIO Award was - at a point in time covered the majority of employees at GIO. Yet, when we look at table 14.2, level 1 is equated to an entry level, and there was no evidence led as to how that circumstance may have changed in the absence of descriptors. It just can't be identified. We also have difficulty conceding how it is that the FSU says that a nine level structure somehow or other can be reduced to only having four or, at the most, five levels that would touch on award employees.
PN530
And it seems to suggest, in table 14.2, that the overwhelming majority of employees of GIO covered by the award would have only occupied levels 1, 2 and 3 of a nine level award structure. We find that, in the absence of any evidence, difficult to concede how it would be that that was ever the case. We also note in relation to table 2 that it's absent descriptors of level 6, 7, 8 and 9, and that there is no explanation or evidence as to how it is said that those levels, and the rates attached to them, somehow or other represent properly set minimum rate.
PN531
A comparison between the two tables, your Honour, and you will recall the evidence of Mr Stevens and Miss Hawkes in this regard, when it was effectively put to them that, for the purposes of level 3 and level 4 employees, which they were, respectively, that the rates proposed by GIO were more advantageous to them, and a review of the transcript, I think, will reveal that they agreed with that proposition. So we would say that, despite some assertions in the evidence, that the GIO proposed order somehow or other resulted in a reduction in wages wasn't bought out in any of the evidence that the Commission heard today and, as a matter of analysis of the draft orders, cannot arise.
PN532
I also sense that there's some misconception, with respect, flowing from the FSU, as to the nature of the process that we're involved in here because the award rates are not properly set minimum rates. They need to be adjusted. And that may result, for some new employees, rates of pay that appear on their face less than what was otherwise provided in an award that was a combination of some actual historical rates of pay that were never subject to a minimum rates process.
PN533
But having said that there are a number of protections. Column five of the draft order sets out the existing award rates which would continue to apply as a minimum for employees as at 23 July 2002 on our submission. And there's also the observation noted in the evidence that the employees receive remuneration significantly above these minimum rates in any case.
PN534
THE SENIOR DEPUTY PRESIDENT: I take it that you're submitting that it's not uncommon for the conversion process to produce this column four residuals which reflects that current award rates may well be above properly fixed minimum rates and that's where the residuals come from.
PN535
MR SMITH: That's right. And we also note that outstanding safety net adjustments subject to application an order of the Commission would be applied to reduce those residuals. And at this stage there appears to be outstanding safety nets from 2000, 2001, 2002, whatever happens this year.
PN536
THE SENIOR DEPUTY PRESIDENT: Now, I note that both orders reflect safety net adjustments up to 1999.
PN537
MR SMITH: Yes.
PN538
THE SENIOR DEPUTY PRESIDENT: Whereas the current award includes rates up to - safety net adjustments up to and including 1998, does it not?
PN539
MS HANNAN: That's right.
PN540
MR SMITH: That's right, your Honour.
PN541
THE SENIOR DEPUTY PRESIDENT: So there has been consent between the parties to incorporate the '99 adjustment?
PN542
MR SMITH: Yes, your Honour. Well, certainly the - - -
PN543
THE SENIOR DEPUTY PRESIDENT: Or was that a matter that was separately applied for?
PN544
MR SMITH: There is. There's an application currently before the Commission.
PN545
THE SENIOR DEPUTY PRESIDENT: Yes, I think that's right.
PN546
MR SMITH: And I think these - the award simplification matter is being heard jointly with the application for - the FSUs application for the safety net.
PN547
THE SENIOR DEPUTY PRESIDENT: But anyway - - -
PN548
MS HANNAN: But it's conceded, isn't it? It's agreed?
PN549
MR SMITH: Yes.
PN550
THE SENIOR DEPUTY PRESIDENT: Yes, but anyway there's consent between the parties - - -
PN551
MR SMITH: Yes.
PN552
THE SENIOR DEPUTY PRESIDENT: - - - for incorporation of the 1999 safety net adjustment. And I take it from comments made before that there had been discussion about whether the later safety net adjustments will also be incorporated.
PN553
MR SMITH: Yes, your Honour, there were without prejudice discussions and I'm instructed that I can confirm this; that during the course of those discussions the company offered to the FSU on a without prejudice basis that if consent could be achieved with GIO4 that the company would not oppose an FSU application for a 2000 safety net adjustment. Which is not something that could be dealt with in these proceedings absent an application before the Commission, which was why the offer was couched in that way.
PN554
THE SENIOR DEPUTY PRESIDENT: So they can't - - -
PN555
MR SMITH: That offer was not accepted by the FSU.
PN556
THE SENIOR DEPUTY PRESIDENT: And so therefore the company's position is what?
PN557
MR SMITH: The company's position is that it's open to the FSU to make its application in relation to the 2000 adjustment and the company would reserve its rights and consider that application on its merits if and when it were to occur.
PN558
THE SENIOR DEPUTY PRESIDENT: Anything further?
PN559
MR SMITH: I don't think so, your Honour, anything further. No, those are our submissions, your Honour.
PN560
THE SENIOR DEPUTY PRESIDENT: Okay, thank you, Mr Smith. Ms Hannan?
PN561
MS HANNAN: Yes, thank you, your Honour. Can I first of all take your Honour to FSU4 and I apologise, your Honour, but there will need to be some corrections due to an oversight made to that. If I could just speak to them now and at the conclusion of these proceedings - they are not going to take very long at all - an amended copy will be forwarded to your office tonight.
PN562
Your Honour, may I first take you, as your Honour has already apprehended, that there is an error at 14.2.4 where it reads:
PN563
An employee in this employment commenced prior to 23 July 2002 shall be paid the minimum rate contained -
PN564
that should be "in column 5 of table 1". And then, in table 2 - "or table 2, column 1" to be inserted in the second line, after "table 2, column 1".
PN565
Your Honour, if I could just ask you to go back to page 2 at 14.2.3 - and this matter has been raised with Mr Smith in the adjournment - the rates in table 2 should, of course, have the existing rates as per the '98 safety net rates contained in the GIO Australia Award. So there will be two columns, column 1 to have the '98 rates, column 2 to have the '99 rates, and I will address your Honour further on the reasoning behind including that shortly, and then, at 14.2.3, the sentence beginning "Where employees occupying levels 4 and above" that should be "post-23 July 2002". And, at the conclusion of that paragraph, after table 2, "column 2". I thank your Honour for your attention to those amendments with a revised draft order incorporating those amendments to be forwarded to the Commission today and to Mr Smith.
PN566
THE SENIOR DEPUTY PRESIDENT: Yes.
PN567
MR SMITH: Thank you.
PN568
THE SENIOR DEPUTY PRESIDENT: It is clear in your mind that 14.2.3 where it refers to occupying level 4, that is level 4 as proposed in this order as opposed to level 4 in the nine-level structure?
PN569
MS HANNAN: That's right, your Honour. That is right. It should be - that's right, in the table 1. So in discussions that we have had with GIO, persons could be offered the remuneration contract at levels 4 and above, so that is what we have sought to capture there.
PN570
Your Honour, if I could just take you to our submissions which will be supplemented on the Commission principles by Ms Lewis, we should say at the outset that we've been faced with the same difficulty in going through this because the award has lacked descriptors in terms of how we update it. Your Honour, the Commission principles which, as I have indicated, my colleague, Ms Lewis, will address the Commission on, requires the Commission to update the awards, updating of awards, in this case, the GIO Australia Award 2002. As your Honour is well aware, the Commission is required to determine that the rates that operate under this award operate as minimum rates of pay to update the award and remove obsolete provisions.
PN571
For the purposes of clarification for the Commission, those matters that Mr Smith has gone to this afternoon concerning the loadings, qualifications and skills as well as junior rates, I am instructed there is agreement in the way that those matters have been characterised. So the matters for determination of the Commission, subject to the Commission's decision, is either those matters contained in FSU4 or GIOA4.
PN572
I continue, your Honour. FSU submits our draft order complies with these requirements concerning minimum rates to apply and classification structure to attach to those rates. We will deal with the content of our draft order shortly and how the evidence led by FSU in this matter supports this order being made by the Commission. This award was first made in 1991 and the submissions from both parties to the award at that time agree that it was a minimum rates award, and I refer to the previously mentioned transcript that I understand is contained in GIOA3 annexures on that issue.
PN573
The difficulty in the current award is that it contains no descriptors. Upon review of the current award structure and the consequent evidence led by FSU, FSU submits that, currently, it is appropriate for the structure, as identified in our draft order, to apply. We consider that it is consistent with the Commission's principles to update the award structure in the way that we have demonstrated to you, that the levels that existed at the time the award was made and the job classifications that would have existed at that time are able to be updated on the basis of similar work that is undertaken today and, as importantly for the purposes of the Commission's principles, as benchmarked against the Insurance Industry Award.
PN574
I just interpose my submissions there by responding to one of the submissions made by Mr Smith concerning perhaps a misapprehension of Ms Hawkes' evidence where she states at 4:
PN575
The majority of GIO staff were classified at level 1 in the GIO award.
PN576
As your Honour would be aware, the 21 years classification there attracted, in the current award, a rate of 21,938. FSU proposes that the appropriate rate there now to be 22,562 to incorporate the '99 adjustment, and what Ms Hawkes is saying there is that - I beg your pardon, that the appropriate rate should be 23,495, that those persons who were found to be at indicative job levels, at level 1 at that time, that is, your claims staff, your customer service roles, etcetera, would now be accurately captured by the proposed level 2 in FSU4.
PN577
Your Honour, I will just go over that. I think I might have confused myself.
PN578
THE SENIOR DEPUTY PRESIDENT: I think I understood the point you were making. You were saying essentially that, as I understood it, that level 1 then essentially is equivalent to level 2 now. Is that what you are meaning to convey?
PN579
MS HANNAN: That is correct, your Honour.
PN580
THE SENIOR DEPUTY PRESIDENT: Now, I'm not sure of the basis on which you say that - - -
PN581
MS HANNAN: Yes, yes.
PN582
THE SENIOR DEPUTY PRESIDENT: - - - but that's as I understood your submission.
PN583
MS HANNAN: Yes. As I say, and as I think your Honour is aware, the difficulty has been that there's been no descriptors. We've had to have regard to the insurance industry award. We're benchmarked against the insurance industry award, or we propose - and that has meant importing one rate at level two, that's why I hesitated there, but persons employed at the 21 years rate in that award have those descriptors as at level one, the claim starts from customer service role to be now captured at level two.
PN584
THE SENIOR DEPUTY PRESIDENT: Is it the rate that's imported, or the - is it a rate, or is it the level, or the descriptors of the level?
PN585
MS HANNAN: Both, your Honour. What we were seeking to do is to say no descriptors in the award; if you go back, at that time, to persons who have been employed with GIO, you can give competent evidence to the Commission, when they were ranked - when they were classified at that time, that's how they would have come across as level one. The level ones would have been your claims officers, your customer service officers. The appropriate rate we say that applies now is as identified in FSU4 for those same updated clerical service support and technical roles.
PN586
THE SENIOR DEPUTY PRESIDENT: So, level one in the nine level structure, effectively dropped out somewhere along the way?
PN587
MS HANNAN: Well - - -
PN588
THE SENIOR DEPUTY PRESIDENT: That's a question, not a statement.
PN589
MS HANNAN: That's fair enough, your Honour. The level one in our FSU4 proposal is the current level one in the award plus the ..... the level two rate is imported - I will get to that in a moment - that is imported from the insurance industry - I think that's where some of the confusion is coming from. In the evidence led by the FSU, particularly that of Ms Hawkes, the Commission will be able to see the job skill levels as outlined, and particularly as attached to the levels one to five as existed in the award of 1991, was able to be translated as given effect in FSUs draft order for the levels gained in one to four.
PN590
Your Honour, on the issue of six to nine, these levels have been currently retained, as I've amended the draft order - supplemented the draft order this afternoon - as set out in table 2, to give proper effect to clause 6 in the award on remuneration package contracts, and you would note that the evidence of Mr Stevens at point eight would support that. Your Honour, what we are seeking to do there, is to say that to avoid an artificial compression as proposed by GIO in their proposal, that the levels six through to nine be retained and have a role to play in the operation of clause 6 remuneration package contract provisions in the award.
PN591
THE SENIOR DEPUTY PRESIDENT: But they have no descriptors and effectively disappear as classification levels?
PN592
MS HANNAN: It's not been an easy issue, your Honour, but perhaps if I can characterise the FSUs submissions as this, and we alerted your Honour to it in the evidence that we have led: that the GIO Australia company has been subject to extensive disputation over the last 18 months and the industrial regulation of GIO staff is still subject to further proceedings between the parties. Indeed, there is a dispute that's been found against Suncorp regarding the service of a log of claims to establish an award.
PN593
What we say, your Honour, is that we have updated the structure as far as we are able to at this point, and that at an appropriate time to further develop the award structure for those senior classifications that Mr Walsh gave evidence on today for management classification and seek to do so at an appropriate time. So, I guess, your Honour, they would still be retained in the award as we have sought to capture them in table 2. Again by referencing to the insurance industry award, the bottom rate there, if you do a light comparison to the lowest rate that applies there, is 41,426, and that is for managerial and supervisory functions to a certain level, and that it is appropriate and this - we might as well deal with this in some other detail - that for those persons on that remuneration package contract, to have a relevant rate as a safety net rate to link into in the event that at some point their arrangements, contract arrangements, no longer applied.
PN594
To do otherwise, and you've heard from Ms Hawkes and Mr Stevens today, those employees are on levels three and four respectively in a salary range between 60,000 plus for Ms Hawkes and 71 for Mr Stevens. Not to hang on to that provision as we are seeking would effectively on GIO4s construction, drop those people forever and a day down to - as updated by consequent safety nets - to 36,707, and that, in our submission, is because of the - the principles would not be appropriate.
PN595
THE SENIOR DEPUTY PRESIDENT: Now, you referred to the insurance industry award. That's a seven level structure, if I remember it correctly.
PN596
MS HANNAN: Correct, your Honour.
PN597
THE SENIOR DEPUTY PRESIDENT: So, in referring to the industry award which is a seven level structure, how do you handle the fact that there are nine levels in the GIO Award - - -
PN598
MS HANNAN: Yes. If your Honour will bear with me - - -
PN599
THE SENIOR DEPUTY PRESIDENT: - - - to be accommodated somewhere in the classification structure.
PN600
MS HANNAN: It's not going to be an exact - perhaps, your Honour, if I can deal with that this way - if your Honour will bear with me, I'm coming to that shortly. Could I just take your Honour back to the 14.2.3 in the draft order, you can say, and it is conceded by GIO that the intention of the parties at the time that the award was varied to retain the original wording that existed in the GIO Award (Australia) 1991 which is captured in 14.2.3, in the subsequent order by the Commission, I think it picked up an earlier draft to talk about overall terms and conditions. It would be FSUs submission, if it pleases your Honour, that the 14.2.3 definition is the one that be retained.
PN601
THE SENIOR DEPUTY PRESIDENT: Sorry, the one proposed here?
PN602
MS HANNAN: Yes, your Honour.
PN603
THE SENIOR DEPUTY PRESIDENT: Is what you say?
PN604
MS HANNAN: If it pleases your Honour.
PN605
THE SENIOR DEPUTY PRESIDENT: And when you say "retained" - retained - - -
PN606
MS HANNAN: Incorporated in your Honour's decision.
PN607
THE SENIOR DEPUTY PRESIDENT: As opposed to - - -
PN608
MS HANNAN: As opposed to the existing - as opposed to the amended clause - - -
PN609
THE SENIOR DEPUTY PRESIDENT: Which is in 6, isn't it?
PN610
MS HANNAN: - - - 6, that was - yes, that was subsequent. The difference being, your Honour, that, as your Honour may have recalled, the new award provided for overall terms and conditions and the existing award provision which GIO agrees with is the salary - the reference to the salary - the reference to the salary - - -
PN611
THE SENIOR DEPUTY PRESIDENT: Clause 6 of the award has already - - -
PN612
MS HANNAN: Been dealt with, been simplified.
PN613
THE SENIOR DEPUTY PRESIDENT: Yes, thank you, I think that's the - there is a clause 6 in the section of the award where the item 51 has already been done, and what I hear you saying is that you're saying clause 6 as it's previously been concluded should be amended.
PN614
MS HANNAN: Yes, your Honour.
PN615
THE SENIOR DEPUTY PRESIDENT: I see. And the basis for that is what?
PN616
MS HANNAN: The basis for that, your Honour, simply is that that was the intention of the parties at the time. We did explore other avenues. We reverted to that position prior to the awards publication. Both parties addressed, your Honour, in final submissions, and I believed it was not picked up. I withdraw that - the FSU addressed your Honour on that matter, but I understand that GIO agreed to it.
PN617
THE SENIOR DEPUTY PRESIDENT: Sorry, agreed to what?
PN618
MS HANNAN: Agreed that the award, at clause 6, should retain its original wording.
PN619
THE SENIOR DEPUTY PRESIDENT: Okay. Well, clause 6 is as it is. That's included in the award that I issued - in the order that I issued on 23 July, so if you want to propose a variation to that, a variation to clause 6, I'm happy to hear from you, but I hadn't approached these proceedings conscious of any application to amend anything else than deal with appendix A. So why don't I leave that one with you. I note the point you are making, and we'll see where we get to, but you may want to - - -
PN620
MS HANNAN: Your Honour, could we deal with it this way. That - I take your Honour's point that, in the event that your Honour was minded by the proposal put forward in FSU(4), that you may require to hear from us more formally with respect to 14.2.3, but in your - in any decision that may issue, you would incorporate the current wording in the award.
PN621
THE SENIOR DEPUTY PRESIDENT: I see. Okay.
PN622
MS HANNAN: Would that be a way to address it?
PN623
THE SENIOR DEPUTY PRESIDENT: I'll take it on board. I just approached this afternoon without any realisation that we were looking at clause 6 as well, which has already been finalised.
PN624
MS HANNAN: Yes. It arose in trying to deal with those other levels, your Honour.
PN625
THE SENIOR DEPUTY PRESIDENT: Right.
PN626
MS HANNAN: Your Honour, your Honour has asked me about the basis for the rates that has been proposed in FSU(4). The level 1 is a rate from the insurance industry award at grade 1, if I can direct your Honour's attention to - I believe I have tagged it - it should be 94. Does your Honour have that? Yes.
PN627
THE SENIOR DEPUTY PRESIDENT: Yes.
PN628
MS HANNAN: Your Honour, at - you will see in the grade 1, 21 years of age or more, those rates contain the 2002 rates. If you subtract the add-on to bring it back to the 99, you will see that that reconciles with the level 1 industry rate. Why is that an appropriate rate? We say, and your Honour, if I can take you to the second tagged section of 92, that the entry level would be typical of those responsibilities and activities identified in grade 1 in appendix B of the insurance industry award.
PN629
Your Honour, I just should clarify that it is the - the level 1 rate is as per the current rate in the 21 years in the GIO award, plus the 99 safety adjustment, and when you strip back the rate in the insurance industry award, we say that it is a comparable rate at around 22870.
PN630
Your Honour, the level 2 is the rate imported from the insurance industry award at grade 2, and the relevant descriptors and purpose and responsibilities are identified in page 93 of the insurance industry award, we say would reconcile with those different issues as we have identified for level 2. Yes, and the rate we propose, Ms Lewis reminds me, is back to the 99 rate.
PN631
We say that the level 3 is the award - GIO award updated rate together with the 99 rate, and reconciles with the level 5 in the insurance industry award. And level 4 is the GIO award rate with the 99 rate, and reconciles with level 6 in the insurance industry award, page 100 onwards.
PN632
THE SENIOR DEPUTY PRESIDENT: On what basis do you say it reconciles with .....
PN633
PN634
MS HANNAN: We say with the duties, your Honour, and also if you strip back the rates to the 2000 - sorry, to the 99 rates in the insurance industry award - - -
PN635
THE SENIOR DEPUTY PRESIDENT: So, what are you doing - you are taking the descriptors that you propose and comparing them with the descriptors for level 6 in the industry award, and saying that they are about equal. Is that what you are saying?
PN636
MS HANNAN: We say they reconcile. Yes, your Honour. That the descriptors in level 6 in the insurance award broadly reconcile with those descriptors that we have identified in level 4. In our proposed order, as your Honour has already heard this afternoon, the descriptors that we propose going forward reflect, and accurately reflects, the work that is undertaken in GIO today.
PN637
To appropriately fix those rates, we benchmark them against like classifications in the insurance industry award, as identified.
PN638
THE SENIOR DEPUTY PRESIDENT: How different do you say that your proposed descriptors are, compared with those in the classification structure in the AMP award?
PN639
MS HANNAN: They have been quite fleshed out, your Honour. We - Miss Lewis will deal with this, but the history of the AMP award, as your Honour would be well aware, is completely different from the GIO award, which sought to demonstrate that through the evidence that we've led this afternoon through Miss Hawkes and Ms Stevens. Miss Hawkes has effectively tracked through where people were at the levels in the GIO award, and where they are today as captured in FSU(4), and we have sought to make it relevant to the GIO company.
PN640
THE SENIOR DEPUTY PRESIDENT: The reason I ask the question is, you will recall that in the decision I issued to set properly fixed minimum rates for the AMP classification structure, I specifically did that comparison. Compared the AMP structure with the insurance industry award, and based on that comparison, determined the rates.
PN641
Now, what I hear you saying is that, and I may be misunderstanding what you are putting - what I hear you saying is that, a comparison of a very similar classification structure and descriptors in GIO, when compared with the industry award, may yield a different result to the comparison I've previously done.
PN642
MS HANNAN: Your Honour, if my memory serves me correctly, in your Honour's consideration in the AMP award, there is a fair amount of a - to do with the broadbanding that went on in those levels, and the rates that existed in the AMP award, because they had already been set as properly fixed minimums, by virtue of His Honour, Deputy President MacBean's earlier decision.
PN643
THE SENIOR DEPUTY PRESIDENT: Yes. But you will recall in that decision, that I dealt with a comparison of the AMP structure against the insurance industry award, and specifically did that analysis. And what I hear you saying is that, that one may do the comparison but nevertheless in this case, come up with a different outcome.
PN644
MS HANNAN: We'll leave it at that. Miss Lewis is at my elbow here, because she believes that it touches on the principles, so - your Honour.
PN645
MISS LEWIS: In fact, addressing the question that matters specifically, your Honour, it is our submission that it is a different circumstance, and without going to the full submission - - -
PN646
THE SENIOR DEPUTY PRESIDENT: I understand that. But just coming back to the point that Ms Hannan was making, and where we got off on this discussion: essentially, you are saying that level 4 in your structure compares with level 6 in the insurance industry structure, based on a comparison of the descriptors. That's as I understood the submission.
PN647
MS LEWIS: Yes, your Honour.
PN648
THE SENIOR DEPUTY PRESIDENT: And, of course, at the moment I don't recall the exact details of the comparison.
PN649
MS LEWIS: Neither do we.
PN650
THE SENIOR DEPUTY PRESIDENT: I did but, you know, I'm just referring to the fact that, in that AMP decision, I specifically record the fact that I've gone through a comparison of the AMP structure and the industry structure and come to certain conclusions, and what I'm really asking you is, you're saying that I should do the comparison in this case, and it's possible that I may come to different conclusions.
PN651
MS LEWIS: Yes, your Honour.
PN652
THE SENIOR DEPUTY PRESIDENT: Yes.
PN653
MS LEWIS: And it's our submission - - -
PN654
THE SENIOR DEPUTY PRESIDENT: So that we all understand what we're talking about.
PN655
MS LEWIS: Yes. It is our submission that your Honour can adopt that process for the simple reason that the award rates here are different. In the AMP matter your Honour looked at the minimum rates of pay in the award, the AMP award. You went through a process of concluding that they were properly fixed minimum rates under the principles, however, the parties had agreed that that classification structure was obsolete and hadn't applied and you, therefore, then had a look at a new classification structure which had associated minimum rates of pay attached to it. And in considering those - the proposed minimum rates of pay to be - - -
PN656
THE SENIOR DEPUTY PRESIDENT: I think at that - - -
PN657
MS LEWIS: - - - attached to that new structure - - -
PN658
THE SENIOR DEPUTY PRESIDENT: I think at that point it didn't have minimum rates attached to it, did it?
PN659
MS HANNAN: It was in the context of we put up a draft order proposing what the minimum rates of pay should be and AMP had also put up a draft order proposing what they thought the minimum rates should be, and I think the reason that - we had referred you to the insurance award as being an appropriate award to use given it was properly fixed minimum rates and applied to the insurance industry as a wider body.
PN660
THE SENIOR DEPUTY PRESIDENT: Indeed.
PN661
MS LEWIS: And it was in that context that we got down to the issue of what was the key classification rate and your Honour then had a look at the Insurance Industry Award in detail there, and you had a look at that review and came down with your decision based on that. Your Honour will recall that was through arbitration by way of your decision rather than consent of the parties in that instance.
PN662
In this case, it has been held that, although the award was intended and did in effect operate as a minimum rates award, it hadn't undergone a proper review which Mr Smith addressed in his submission and I will address a little later in slightly more detail but not great detail. But suffice to say, at this point, that that was the state. So we haven't got a properly fixed minimum rates award. It has to undergo a review under item 51(4) but, at the same time, the parties have agreed that, in any event, it is an obsolete provision and in terms of 51(7), we need to have a look at a new classification structure.
PN663
We have agreed that it is appropriate that a four-level structure be looked at. However, as your Honour has pointed out, it is difficult to condense nine grades into four, just as it is difficulty to put seven into four. Mr Smith had commented in his submission that it was a difficult process and that they tried to take into account the actuality of the employees' situation. We've also done that and, in fact, the bulk of the witness evidence that we have led tries to paint a historical picture of the work that has been performed by GIO employees from the start of the process, the very start of the process, and where they might line up now.
PN664
There has been mention of the AMP/GIO Enterprise Agreement and, yes, that applied to GIO employees when they went over to AMP for that brief period of time, but that, nevertheless, was always underpinned by the GIO award. They didn't become bound by the AMP award. So there were two different considerations, two different awards applying as the safety net minimum.
PN665
THE SENIOR DEPUTY PRESIDENT: By the way, I make it plain that our discussion about AMP is in the context, well, that was AMP, this is GIO that we are considering, but my question and my reference to the AMP exercise was, namely, that - - -
PN666
MS LEWIS: Why a different outcome this time?
PN667
THE SENIOR DEPUTY PRESIDENT: Yes, exactly. Exactly right. Having clarified that, we all understand that that was AMP, this is GIO.
PN668
MS LEWIS: What we have looked to do is, in fitting the nine grades that are specific to the GIO award into a four-level structure, we've looked at how the work that they have been doing could be categorised and where it would fit in the four-level structure. We then had a look in the absence of descriptors, we looked at the work they had actually been doing and looked at the descriptors in the industry award, the Insurance Industry Award, to see where they might line up as far as the work is concerned, and then the comparison of the salary. So we have effectively - - -
PN669
THE SENIOR DEPUTY PRESIDENT: Yes, yes. You have tried to do the work value comparison.
PN670
MS LEWIS: We've tried to do the work value comparison between the GIO rates which originated as public service rates operating as a minimum rates award that wasn't a properly fixed minimum rates award to a anew classification structure that also pays heed to the conversion principles. So we tried to look at the work that was being done, assign it to a level that's commensurate with - still commensurate and relative to the work they have been doing and then to assign a benchmark salary to it.
PN671
And also, as Ms Hannan has just correctly pointed out, there is not - strictly speaking, there is not nine levels condensed into four because, in our draft order, we don't seek to have the minimum for level four the same as the present minimum of level nine. We will be dealing - I think Ms Hannan will be dealing with the issue of the fives to nines further in her submission, but I hope that clarifies why a different outcome.
PN672
THE SENIOR DEPUTY PRESIDENT: Yes.
PN673
MS HANNAN: And your Honour, just two things I would like to say: a number of comparisons that have been made between our FSU4 and the Insurance Industry Award have identified the correlation with those descriptors and rates as ..... back to 1999. For the convenience of the Commission, when the amended draft order is forwarded, I might just single those out to assist. But your Honour asked about the comparison between the two classification structures, there are additional classifications that are contained in various levels throughout the GIO Australia order, and different - I will leave it at that, your Honour, that it is as identified in FSU4.
PN674
Ms Lewis must think I am going to be some time, but I am not. Your Honour, today, in the evidence that has been led by Mr Walsh, certain over-award arrangements have been referred to. As your Honour is well aware, the relevant consideration here is to develop an appropriate safety net award. The FSU submits that is as per exhibit FSU4. Based on the evidence that has put by the FSU and the supplementary submissions to be made by Ms Lewis concerning the Commission needing to be satisfied of the principles, we say that FSU4 is the appropriate draft order for the Commission to adopt.
PN675
And, your Honour, just whilst I'm on my feet, I think I have, in the body of my submissions, in any event, responded to a number of matters that have been raised by Mr Smith, but I recall in one later submission before you for the AMP award, there was actually an agreed position from AMP that we viewed the level 3 as the appropriate key classification because it has a trade certificate and your Honour, at that time, determined that it wasn't appropriate, if you like, for the Commission to determine what the relevant key classification was. I think it formed part of latter proceedings concerning the appropriate either entry rate or junior rates that your Honour required further submissions on and you may recall that.
PN676
So, at that time, AMP was of the view with FSU that level 3 is, in fact, the appropriate ..... Trade qualification, if you like, at C10, equivalent, as it does have that qualification, as your Honour will see.
PN677
THE SENIOR DEPUTY PRESIDENT: And so, on what basis do you say - I take it you're saying that's the key classification here as well. On what basis do you say that?
PN678
MS HANNAN: Ms Lewis will again develop this, but it does have the qualification at TAFE level. That would be the trade's equivalent, your Honour, normally held as I understand it. I just wanted to clarify one other matter since Mr Smith did refer to it and I think I mentioned it earlier on, just to properly inform the Commission. The discussions that we had on what happens with safety nets, were actually taken up, your Honour, without prejudice basis, to 2002, and FSU did spend some considerable time looking at an amended draft order, and amended the draft order to include the 2002 rates subsequent to there being no agreement, we have revised it as per FSU 4, if the Commission pleases.
PN679
THE SENIOR DEPUTY PRESIDENT: Right. Thank you. Okay, Ms Lewis, you want to address some of these rates as well.
PN680
MS LEWIS: I'll try to be brief, your Honour, having now being on a later plane, because I can still get home. Your Honour, it is submission, as Ms Hannan has detailed, given the history of the GIO award that it is more appropriate to benchmark it against the insurance industry award. Mr Smith has disregarded or said that our submission that the AMP award has no relevance because of the limited employment relationship between AMP and GIO employees, but he said that that argument should be discounted or disregarded.
PN681
Rather, we say that it's the value of the work and the history of the award that does and has always applied to the GIO employees. As I mentioned briefly earlier, the AMP award has never applied to the GIO staff. So the rates in that award has never applied to the GIO staff, so the rates in that award were not relevant to the GIO award.
PN682
THE SENIOR DEPUTY PRESIDENT: Presumably, the industry awards never applied either.
PN683
MS LEWIS: No, but we're saying that the argument then goes - the submission then goes on to say that the - in bench-marking or looking for the standard that applies across the industry, it is more relevant to use the industry award than the award of a company who happened to have an employment relationship with GIO for a brief time in the past. There was a period of nine months and that the nine months where GIO was owned by AMP. They were actually employees of AMP Services, but the GIO Australia Award continued to apply, to put it more correctly.
PN684
We say that it's in looking at, doing a comparison in accordance with the conversion principles, it is more appropriate to use the industry award because the standards and the job narratives and classification standards under that award apply extensively across the insurance industry. Both to employees of large insurance companies and medium-sized insurance companies and very small insurance companies, so it is a better cross-sectional sample and it is more representative of the work that's done across the wider industry rather than the work that's done in a particular company in the industry.
PN685
The evidence of the - Ms Hawkes went to the issue of the method by which the GIO staff were placed into the AMP/GIO Enterprise Agreement Classification Structure, the four level structure. Ms Hawkes' evidence differs from Mr - it was either the headache or the pain-killers. You've got the headache version of me. Ms Hawkes' account of the process that was followed for GIO employees and her placement, in particular, differs from the evidence of Mr Walsh.
PN686
He talks about an extensive process that had been carried out, whereas Ms Hawkes' evidence and submissions made by the FSU previously have been that, although the enterprise agreement provided for an extensive process to be followed in - when the GIO people came over, it's our submission and Ms Hawkes' evidence would support the submission, that no such detailed process took place.
PN687
The conversion process was carried out for the AMP employees on the basis the work they were performing, they were fitted to the fall of the structure. When the GIO employees came across, that intended next step didn't happen, and they just were slotted in to the four level structure. So we would say, that there is - there was no proper work value analysis of how the nine level award structure was going to be fitted in to the four level enterprise agreement structure.
PN688
And in any event, had that detailed process happened, that the work value of the work that the GIO employees had been performing, and that was provided for under the nine level minimum rates safety net of the award, was different from looking at the seven level safety net structure that existed at the time in the AMP award.
PN689
I mentioned briefly before, your Honour - I confirmed Mr Smith's observation that we have agreed that this award has never been subjected to a proper minimum rates review, and Mr Smith drew you to, or referred you to comments by me and by yourself, in various paragraphs of the transcript of the November hearing of this matter. And that was in the context of the application - section 105 application by the FSU.
PN690
However, I did take your Honour, at that point, to various comments from the transcript of the original hearing of the making of the award in 91, where the parties - the advocates for both the parties indicated that it had been their intention that it would operate as a minimum rates award. And his Honour concluded that it was to operate as a minimum rates award, which unfortunately missed out the next step in the process, unfortunately.
PN691
Mr Smith mentioned in his submission that GIO was an AMP company, and that they are named as party to the enterprise agreement. But as I mentioned previously, the AMP-GIO agreement has only ever been underpinned for the purpose of the no disadvantage test by the AMP Award. There's no consideration at all in that to the GIO Award. Also the AMP classification structure, as I mentioned, was in place prior to the GIO employees going over. And not only wasn't there any consideration of the GIO Award or consultation with the GIO employees, the AMP-GIO agreement was, in fact, certified by the Commission prior to the GIO employees moving across so they had not participated in the endorsement process of that agreement.
PN692
Your Honour, in his cross-examination of both Mr Stevens and Ms Hawkes Mr Smith seemed to make a big deal out of the fact that they were on a salary considerably higher than the proposed minimums for the new 4 level structure and indeed on considerably higher than the current minimum rates of pay. The fact that there is a classification structure and minimum rates of pay operating under another industrial instrument that takes precedent over this is not surprising. The rates proposed by both FSU4 and GIO4 for that matter are minimum safety net. They are not there - you know, we wouldn't want anyone to be paid those rates but they are there as the safety net. If all else fails people won't be paid any less than that.
PN693
Your Honour, by simply condensing the current classification structure to the structure proposed by GIO, at the moment the current minimum for level one is 21,938 adult rates and level nine is 46,970 for the second year, so that's that minimum second year. What's proposed by the GIO4 draft order is, certainly it picks up on 45,752 at the last salary in column 5 for level 9. However, that's only residuals so that's the savings clause for current employees who are on those salaries as indeed is column 5 of the FSU draft order, both residuals as provided for under the conversion principles. It's spelt out there. Those figures will stay the same and any future safety net adjustments, of course, will only be made to column 3. So it's column 3 which are the minimum rates.
PN694
THE SENIOR DEPUTY PRESIDENT: And also column 4. Column 4 will steadily reduce.
PN695
MS LEWIS: Yes, the residual amount will condense. In other words, if you like, the over award minimum becomes less as it catches up to the residual. So column 3 is the actual minimum rates of pay that are being proposed to be the safety net under the award which shows collapsing the current rates, again 21,938 46,970, collapsing those to 21,938 to 36,707.20. Now, the rates in the FSU order at column 3 for level 4 is 36,349 which is less than the maximum of 46,970 currently provided for at level 9.
PN696
However, that's where table 2 at 14.2.3 of our proposed draft order comes in. Just as coincides at 14.2 is a savings provision for current employees so is 14.2.3. It also goes to make sense of clause 6 of the award, regardless of whether it stays the same wording at clause 6 or whether there's a reversion back. Regardless of the wording of it, clause 6 refers to people paid or people occupying levels 4 and above.
PN697
Under this, under the minimum rates there are no levels above 4. It sets level 4. The only levels above that are the residuals, the savings provisions. So we would say that there needs to be some sense made of both clause 6 for those going on to packaging to be tied into an award level and also some savings provisions for those people who are currently on those higher levels and savings to the minimums that are currently provided for.
PN698
One of the, whether deliberate or unintentional effects of knocking out levels 5 to 9 of the current structure and not having that same highest minimum equivalent to the current level 9 is that some of the people in those grades may by effect be deemed to be not award employees any longer for other purposes. Now, by that I mean, the award says that it applies or it binds GIO, its employees and the FSU. Now, it has always applied to all GIO employees and the minimum is up to grade 9, that's encapsulated all of the jobs within GIO with very few if any exceptions.
PN699
By collapsing the minimum rates of pay down to the proposed 36,707.20 or even if you collapsed it to the FSUs proposed minimum of 36,349 without any other savings clause, given that you'd look at, well, who's wages and conditions are governed by this award? If someone whose an old level 5, 6, 7, 8 or 9 were to be dismissed by the company and they wanted to lodge an unfair or an unlawful termination of employment application, under section 170CC of the act, it says that certain categories of employees are exempt, including non award employees who earn over a certain amount of money.
PN700
Now, the regulations, at regulation 30B(4) defines an award employee as someone whose wages and conditions of employment are regulated by an award or an enterprise agreement or an AWA, I think. So that person who was say an old level 8, if they point to their coverage of their wage under the award, there is no wage. Now, there may or may not be one under the enterprise agreement. If there's not, they won't be able to say that their wages and conditions are regulated or governed by the award any more.
PN701
We're concerned to make sure there is a proper savings provision for these people of both higher levels but you'll note that we have done it effectively as a savings clause because our reference to table 2 and as amended by Ms Hannan as she correctly points out, that correction to the wording. It puts in a protection so that it is there as a savings and doesn't apply to anyone who commences employment - sorry, post 23 July 2002.
PN702
Your Honour, some of the rates in column 3, given that they're the real minimum rates, some of them are different but we could have just grabbed the higher rate that's proposed by GIO in their column 3 where there is a difference and said, well, they've agreed to that, stick that in as well and hope that you'll accept the lot. We've tried to be more straight forward than that and given that we have undergone a fairly exhaustive process with our members trying to put together the history of the work that's been done and the value of that work and where it lines up, we have limited ourselves to that exercise and not just done cherry picking. Of course, the latter would have been easier than the former.
PN703
The issue of the 99 safety net adjustment, your Honour raised that and Mr Smith addressed that. That's the only increase on which there is consent of the parties. We thought we had consent for others but we haven't. We note that if your Honour, however, was willing to do that, make such a variation under your own motion, we'd be happy with that.
PN704
THE SENIOR DEPUTY PRESIDENT: But you're also aware that the principles come into play.
PN705
MS LEWIS: The only other brief comment perhaps to clarify Ms Hannan's comments about clause 6, my understanding is that clause 6 of the award simplification order that you did in fact hand down is consistent with the final draft order that you had from the parties and then you rather speedily handed down the decision. However, the parties had realised there was a change of words from the original award and consented to reverting to the original wording but no one put in a correcting draft order so your Honour acted on the consent order. So that explains how that came about.
PN706
THE SENIOR DEPUTY PRESIDENT: I took agreement at the conference and acted on it. You're not suggesting that's unusual, just unfortunate in this case.
PN707
MS LEWIS: Not at all. Yes, it's just that it was the version before last shall we say and it's only just been picked up that that's happened in the context of this most recent proceedings. If it please the .
PN708
THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Smith, do you expect to be long?
PN709
MR SMITH: No, I don't, your Honour.
PN710
THE SENIOR DEPUTY PRESIDENT: I look at that clock and think well, 6 o'clock is a nice round number.
PN711
MR SMITH: Yes, I think I'll be finished at 10 to.
PN712
THE SENIOR DEPUTY PRESIDENT: Thank you.
PN713
MR SMITH: Your Honour, I only have one point in response to all of that. In relation to GIO4, we would say that there's nothing in GIO4 that limits the scope of the operation of the award. The scope of the award is as contained in the parties bound clause which specifically states that it applies to all employees. Now, properly read, the proposed draft order put forward by GIO would set a minimum rates of pay that would apply to all employees that are covered by the award. So there's nothing about GIO4 that would displace or reduce the scope of the award in our submission.
PN714
In terms of Ms Lewis using the language of a savings provision, we refer to paragraph 14.21 of GIOA4 which explains how it is intended that employees occupying levels higher than level 4:
PN715
Pursuant to a written remuneration packaging, contract of employment will be treated -
PN716
and we say it's dealt with properly there. We say that the approach of the FSU to dealing with employees that occupy positions above level 4 seems to us to be materially different from how it was dealt with in the AMP GIO Agreement and is misconceived because it doesn't involve attaching properly formulated descriptors or setting properly set minimum rates. So the order on that basis can't be made in the form proposed by the FSU in our submission. We have nothing further, your Honour.
PN717
THE SENIOR DEPUTY PRESIDENT: Right.
PN718
MS LEWIS: Your Honour, I have one very brief word.
PN719
THE SENIOR DEPUTY PRESIDENT: Certainly.
PN720
MS LEWIS: I started on one point and Mr Smith has just reminded me that I didn't actually continue on the point. When I talked about, your Honour, the collapsing of the present minimums from level 1 to 9 into the lesser minimum provided for in column 3 of level 4, so there's the reduction to 36,707.20 as the highest minimum provided for as compared to 46,970 as currently provided the minimum for level 9, unlike the FSU, that provides a savings provision.
PN721
We say that the proposed draft order at GIO4, in fact, is a reduction in the current safety net value and we say that under the wage fixing principles that it is not allowed because the award simplification process is not about reducing current entitlements or current conditions and we would say their proposal to have a lesser safety net value for the wage structure is a reduction in the overall safety net value of the award and therefore is inconsistent with both the award simplification process and the conversion principles. If the pleases.
PN722
THE SENIOR DEPUTY PRESIDENT: Thank you.
PN723
MR SMITH: Your Honour, if I can conclude with this thought. The problem with that submission, of course, is that it's referring to award rates that aren't properly set minimums. It's a circular argument.
PN724
THE SENIOR DEPUTY PRESIDENT: Ladies and gentlemen, I thank you for your patience and good humour in carrying in till this hour, particularly also to our court reporter and it seemed to me having come this far and being altogether and particularly Ms Lewis having come up from Melbourne, we might as well do it now. Obviously I'm going to take away and analyse the material that you've handed up today and the submissions and we'll reserve a decision on this and be in contact with you when I've done my homework.
PN725
I'll just conclude by saying thank you for your patience and being prepared to soldier on and get it done. That's sort of a red letter day for us in the proceedings here, isn't it? I think we can conclude by adjourning today's proceedings. Thank you.
ADJOURNED INDEFINITELY [5.55pm]
INDEX
LIST OF WITNESSES, EXHIBITS AND MFIs |
EXHIBIT #GIO4 PROPOSED ORDER SENT BY FAX ON 27/3/2003 PN57
EXHIBIT #GIO5 SUPPLEMENTARY STATEMENT OF DENNIS WALSH DATED 25/03/2003 PN68
DENNIS JOHN WALSH, SWORN PN82
EXAMINATION-IN-CHIEF BY MR SMITH PN82
CROSS-EXAMINATION BY MS HANNAN PN98
RE-EXAMINATION BY MR SMITH PN182
WITNESS WITHDREW PN194
EXHIBIT #FSU4 DRAFT ORDER PN210
LARRY GRAHAM STEVENS, SWORN PN262
EXAMINATION-IN-CHIEF BY MS HANNAN PN262
EXHIBIT #FSU3 STATEMENT OF LARRY GRAHAM STEVENS DATED 27/03/2003 PN270
CROSS-EXAMINATION BY MR SMITH PN275
RE-EXAMINATION BY MS HANNAN PN327
WITNESS WITHDREW PN342
LINDA LOUISE HAWKES, AFFIRMED PN346
EXAMINATION-IN-CHIEF BY MS HANNAN PN346
CROSS-EXAMINATION BY MR SMITH PN357
RE-EXAMINATION BY MS HANNAN PN396
WITNESS WITHDREW PN435
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