C2003/1346, Transcript of Proceedings [2003] AIRCTrans 1406 (15 April 2003)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 4, 179 Queen St MELBOURNE Vic 3000
(GPO Box 1114 MELBOURNE Vic 3001)
DX 305 Melbourne Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS


O/N VT2184
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER BLAIR

C2003/1346

CONSTRUCTION, FORESTRY, MINING
AND ENERGY UNION

and

BURGESS FURNITURE PTY LTD

Notification pursuant to section 99 of the
Act of a dispute re the alleged failure to
comply with the provisions of the certified
agreement regarding the selection of employees
to be made redundant

MELBOURNE

12.57 PM, TUESDAY, 1 APRIL 2003

Continued from 11.3.03

PN334

MR R. LOWE: I appear for the CFMEU FFTS Union Branch. Appearing with me are MR J. PATTI and MR T. HANLON, the shop steward from Burgess Furniture.

PN335

MR T. DONAGHEY: I seek leave to appear in place of Ms McGuinness who I believe appeared last time this matter returned before the Commission. With me is MR P. BOYNE from the company, and I am instructed also by the company. If the Commission pleases.

PN336

THE COMMISSIONER: Mr Lowe, do you have any objections to Mr Donaghey seeking leave?

PN337

MR LOWE: Commissioner, no, we have no objection.

PN338

THE COMMISSIONER: Okay. Thank you. Leave is granted, Mr Donaghey. Mr Lowe, the union has asked that this matter be brought back on.

PN339

MR LOWE: Yes, Commissioner. I would like to thank you for bringing the matter back on at the request of the union. There are a number of things we want to raise today, if I can go through them briefly, and then possibly we might want to go into conference to see if there is some resolution to the issue. It appears that some of the problems with this particular matter are more difficult to resolve and just won't go away, and there are some matters that have been brought to light to the union that we weren't aware of in the first instance when the redundancies were mooted by the company and the employees that were made redundant were selected.

PN340

I want to deal with Mr David Lobosco and matters relating to his trial as a storeperson and subsequent to that the refusal of the company to employ him as opposed to a person with lesser service. Mr Wayne Birrer, the tradesman/cabinetmaker who was made redundant and in that, I want to raise the issue of the quantum of redundancy compensation made. There has been an issue that I was unaware of, and I am instructed that Mr Patti was unaware of, that it wasn't raised by the company during the negotiations about the redundancy.

PN341

The shop steward was on parental leave at the time and we were unable to contact him and didn't find this information out, but it relates to the contracting out of work undertaken by the company prior to Christmas of last year, and that work relates to dovetailing, it relates to cutting timber to size and laminating, and the employees were advised that this would have no effect on employees' jobs. We have discovered, Commissioner, that this particular work has been contracted out to the Salvation Army, that my understanding is that they run a number of programs, employment programs for people, and obviously this is done at a lower rate than what the award provides for and they are not respondent to the Furnishing Trades Award, so I want to raise that issue.

PN342

I want to raise the issue of - again of Mr Anthony Costas, if I have pronounced his name correctly, and that was the person who was the person who was the french polisher. I have just been advised that for the last two or three years he actually wasn't on french polishing work, he was doing dovetailing work which is one of the jobs that was contracted out, and we want to raise that issue with you, sir, and the issue of compensation.

PN343

We want to raise the issue of overtime which has been done by employees since the issue of people being made redundant occurred, that being done by employees from various departments not in their normal job, and then overtime those jobs then at the end of the overtime being carried out by company supervisors. And then finally, Commissioner, we would want to raise the issue if we may of the company resigning people who were members of the union initially without their knowledge and contrary to an agreement that had been made with the union some time ago.

PN344

THE COMMISSIONER: What was that issue, sorry?

PN345

MR LOWE: The company advised the union of the resignations of three employees who were members of the union. At the time that that occurred, Commissioner, the employees hadn't been advised that that had happened. We ascertained that by Joe Patti actually contacting the people directly, and they weren't aware of that. And there had been an agreement reached some years ago that those employees, a number of employees in I guess supervisory positions, and would be members of the union, and the company would pay their union subscriptions as an over-award payment.

PN346

So, those are the issues that we want to raise with you, Commissioner. If I could deal in the first instance, Commissioner, with matters relating to David Lobosco, if I may, I would - - -

PN347

MR DONAGHEY: If the Commission pleases, would the Commission be assisted by hearing from me in relation to any of these outlined issues before we progress, or do you wish to continue to hear from my learned friend?

PN348

THE COMMISSIONER: It depends what you are going to say, Mr Donaghey. What is the intent of the submissions?

PN349

MR DONAGHEY: Merely a summary on behalf of the company, sir. Would you be assisted?

PN350

THE COMMISSIONER: No. I think I will hear from Mr Lowe and then obviously the company will have ample opportunity to respond, thanks.

PN351

MR DONAGHEY: Yes, sir.

PN352

THE COMMISSIONER: Yes, Mr Lowe.

PN353

MR LOWE: Thank you, Commissioner. I want to provide the Commission with two documents, sir, if I may.

PN354

THE COMMISSIONER: Yes, Mr Lowe.

PN355

MR LOWE: One is a document in handwriting, Commissioner, which I understand was provided by the company to David Lobosco about the work that he would have to undertake, in the trial as a storeperson. It just sets out the jobs that he was going to be required to do over the three-day trial period. The second copy you have got is the original of a letter sent to the union by David Lobosco regarding how he felt about the situation and the company really didn't have, in essence or in summary, no intention of employing him in that position.

PN356

In respect of the work that was undertaken I am instructed, Commissioner, that the work that was to be undertaken was advised to him by a supervisor who works in that area by the name of Wayne Kewell. He showed David the job and then left him to it, as I understand it. I am advised by the shop steward, Commissioner, that normally he would work with Steve, who was the current employee, and they would do the job together and David during periods of time of the trial was possibly doing the work which would normally be done by two people.

PN357

There was a - after the trial period there was a meeting at which the progress of Mr Lobosco was discussed. There was, as I understand it, at that meeting, the shop steward, there was Wayne, who was the direct supervisor, and two other foremen from the plant, one by the name of Justin and one by the way of Forge. It is indicated by the letter and been confirmed to me by the shop steward that for a considerable period of time David Lobosco and the shop steward by the name of Justin hadn't got on together at all.

PN358

However, it was believed to be the - by the people that met with the exception of the company management representatives, two of those people considered that David would be able to pick up the job with a couple of further weeks' training. One considered there would need to be a longer period than that, of around about three months, and one believed that he would never be able to do that work under any circumstances, and the issue related to in those matters errors that had been made by David during this trial period which in this letter signed by David Lobosco he denies.

PN359

So, we have a situation were I guess there were three people saying that yes, he could do the job for varying lengths of time just to get fully up to speed, because I think as I understand it there were some 2000 or so components that he would have to be aware of and just get all those things into his, I guess, memory bank so that he would be able to do that job much quicker than he would in a training situation. And there was one who believed that regardless of how long he had in training he wouldn't be able to do it.

PN360

However, the company management people it appears have made a decision to stick with the current incumbent, who is a person with lesser service, and again the union believes it is contrary to the terms of the enterprise agreement. With the issue of Mr Birrer and the question of the quantum of his redundancy payment, Mr Birrer had been employed by the company for a period of four years, or maybe I should say employed at the company for a period of four years of unbroken service.

PN361

He was an apprentice for the first two years of that and then continued on without a break as a tradesperson undertaking cabinetmaking work for the company. The argument that we put to the company was that he was employed during that period of time, the redundancy compensation should have equated to what applied for someone with four years' service, and the company's view was, well, he was employed by a group training company as an apprentice, he wasn't our responsibility and so while morally you are right, we have got no obligation to pay him that.

PN362

In this situation there was just no break, he commenced his last two years of his apprenticeship with Burgess as an employee of - or working for the company right the way through and then just continued on with a smooth transmission to that of a tradesperson, and we were of the view, Commissioner, that at least he should have been paid out the four weeks' redundancy payment. In respect - - -

PN363

THE COMMISSIONER: I suppose the - sorry, Mr Lowe. I suppose the issue that may assist in determining whether or not Mr Birrer is entitled to four years' redundancy is whether or not for the purposes of annual leave, sick leave, and accumulation towards long service leave, the two years that Mr Birrer was with the group apprenticeship scheme has in fact carried over for the purposes of the other entitlements under the award or agreement.

PN364

Now, if the employer says that for the purposes of for instance annual leave the service that he had with the company as a group apprentice was counted and therefore he didn't have to start afresh in terms of accumulation, and the same would go to any entitlement to sick leave and so-forth, or whether at the end of his group apprenticeship scheme any outstanding entitlements he was paid out from the group apprenticeship scheme and although he may have been there on the premises, finished on the Friday with the group apprenticeship scheme, as an example, for instance, and then started back at the same premises on the Monday but as a direct employee, I mean, that is something that Mr Donaghey can probably address to see whether or not we can clarify that.

PN365

If there was a smooth transition and it meant that there was no break in accumulation of entitlement then I think your case would be strong in terms of saying that there should be a quantum based on the four years rather than based on the two years, if I understand the years correctly.

PN366

MR LOWE: Yes, yes, that is correct. Well, Commissioner, I am not aware of what happened in respect of any sick leave - - -

PN367

THE COMMISSIONER: No, that is why I - - -

PN368

MR LOWE: So I haven't got that information.

PN369

THE COMMISSIONER: No. That is why I have asked the question, to give Mr Donaghey a chance to - - -

PN370

MR LOWE: Well, the company might be able to provide us with that detail, and I am not too sure what their accounting records have done in respect of long service leave, but as far as I am aware about annual leave, if there was no - if annual leave - I believe, but I stand to be corrected on this, that in respect of annual leave, if there was anything outstanding it would have continued on and he would have got that during his period of time as a tradesperson, but that needs to be confirmed by the company, Commissioner.

PN371

THE COMMISSIONER: Surely.

PN372

MR LOWE: I guess one of the major issues which is of concern to us comes to the issue of the contracting out of work which has obviously had an impact on the employees at the company with the work which was done by employees directly employed by Burgess Furniture, and that is in the laminating, dovetailing and timber cut to size, and the commitment that was given by the company that this wouldn't have any impact on anybody's job. Now, the certified agreement, Commissioner, provides for in the commitments and objectives clauses, under objectives it talks about the increased efficiency and productivity of the company:

PN373

...through the effective utilisation of skills and commitment of employees.

PN374

It goes on to state at (v) of clause 1:

PN375

...to achieve the specific goals of the company, namely to maintain the level of work for all employees and a high standard of production and to efficiently and economically perform all duties to ensure future contracts.

PN376

Now, I am instructed that Mr Patti raised this particular issue with the company, but not in a direct sense. We have been having some discussions with the Victorian Government through the Department of Correctional Services about the union's concerns about work being contracted out to prisons and the impact that that is having on the industry and the people that we represent as employees within that industry. That has been the subject of a number of meetings between ourselves and the department and there are ongoing meetings planned.

PN377

Now, Joe raised this particular issue in that sense, and he has advised me that the company never raised an issue that we had contracted any work out not to the prisons but to an organisation such as the Salvation Army, who obviously have a role within the community of providing a whole lot of assistance to the disadvantaged of people in the City of Melbourne and in the State of Victoria as well as other parts of Australia. Those issues were never raised. But I am instructed by the shop steward that there was this commitment by the company that it wouldn't have any impact on employment, and it appears to us that that has not been the case.

PN378

Now, I understand that the people who were directly employed in laminating was around about three persons, and in dovetailing two, and timber cut to size, one person. So there was a number of things that have occurred that the union wasn't aware of, didn't have access to the shop steward to get that information, and the company wasn't forthcoming with it, and one of the issues which the Commission will recall will be the issue relating to a person who was employed as a french polisher and the company was dissatisfied with the work that this particular person was doing.

PN379

There was an issue some time previously, and the redundancy package was asked for, and the Commission had certain views about that. What we were told, Commissioner, was that he was chosen because as a sprayer he wasn't up to scratch. Now, my understanding when I delved into this a bit more was that he had learned the old trade of french polishing; you do it with a cloth and you bring up the very high quality finishes which are somewhat different to spraying, but I have been advised by the shop steward, and my first time I was able to meet with him was on Friday of last week, was that for the last two or three years this gentleman, Anthony, has actually been doing dovetailing work, one of the jobs that happened to be contracted out to an outside organisation.

PN380

So, that has had an impact I guess on the attitude that the union has taken in this whole issue, and Joe had spoken to them especially that this particular gentleman was the longest-serving employee to be made redundant, about having in his compensation package at least some recognition of the time that he had spent with the company and that at least there should be some recognition of long service leave with the company, and pro rata. So, it seems to me, sir, that there are some things that we weren't aware of, that were kept from us by the company, which would have certainly changed the issues that we may have argued in front of you previously.

PN381

I want to come, if I may, sir, to the issue of overtime. Since the employees have been made redundant I have been advised that at least two employees have been brought in on a regular basis for initially half an hour a day in the morning to wrap product, which is probably part of a storeperson's job, not the employees who were brought in on overtime, not their normal job. They would come in and they would work overtime. And then I am instructed, sir, that after the overtime had finished and it was time for their normal work to start then their job was taken over by supervisors.

PN382

Now, it could be argued, Commissioner, that from time to time work has been done by supervisors, but the union has, I guess, if you like, condoned that. But we see a significant difference in times where I guess there is no effect on people's jobs, where there is not a downturn in the industry, where our members' jobs aren't affected, and a time when people have been made redundant and then the supervisors are doing that work.

PN383

Now, I am advised, sir, and I guess that this is I guess a position that comes throughout from Troy's knowledge of the work which is done that the work which is done by supervisors both in the store and in the other parts could have been done by two employees who have been made redundant. The enterprise agreement, sir, in respect of redundancy states that - in clause 16(ii):

PN384

The discussion shall take place as soon as practicable after the employer has made a definite decision hereof and shall cover, inter alia, any reason ...(reads)... of the employees concerned.

PN385

Now, these matters weren't raised at all with the union, sir, and we are of the view that had we known at this stage there would have been a number of steps taken to mitigate the effect on employees, and one of them would have been said, look, you know, we are happy when things are good to have the supervisors carrying out manual work to assist our people to, you know, make sure that the company operates in a viable position, but when our members and your employees have been laid off, then we take a different view to the issue.

[1.25am]

PN386

The final matter, Commissioner, relates to I guess a letter that - a number of letters that the union received, and I have got two documents here I will hand up, sir, and they relate to the resignation of three members of the union. If I could hand up those to the Commission. Thank you.

PN387

THE COMMISSIONER: Right.

PN388

MR LOWE: The document with four - I didn't realise there was four I thought there was three, but a document with four pages, Commissioner, indicate - Commissioner, there is one page I have photocopied twice. I think I have done it on all of them.

PN389

THE COMMISSIONER: Actually I have got Mr Calleja resigning four times.

PN390

MR LOWE: I think I may have made an error. But the issue was that there had been three people who had resigned from the union - or the company had resigned and Joe sent a fax through to Burgess Furniture regarding the three resignations and reads:

PN391

In reference to the three resignations, the persons concerned advise that they were not aware of the company's intention to resign them.

PN392

Now my understanding is that the letters have come in since that supporting the company's position. But the - I am advised, sir, that there was an agreement between the union and the company that - in respect of the people who were in supervisor's positions that there would be an over award payment made to them by way of an amount quoting to the union fees and the union fees would be paid by the company on behalf of these people.

PN393

Now that agreement made by agreement between the two parties has unilaterally, obviously, been changed without any discussion with the union. Now we are saying that agreements stand in concrete for ever and a day but with a company who you are supposed to have good and proper relationships with, then we would expect that if the company is wanting to change an agreement that they would come to us and talk about it and give us the opportunity to respond - and that hasn't occurred.

PN394

And so these are the issues, sir, that we feel strongly about enough to have sought to have the matter relisted to see if we can find some way of resolving the problems that we have between us. We want to be in a position of maintaining a good working relationship with the company however we are finding that rather difficult and we have again sought to see if we can resolve some of these issues. Now the union, as I indicated, is happy to go into conference where maybe these matters can be canvassed further to see if any resolution can be made, if the Commission pleases.

PN395

THE COMMISSIONER: Yes, thank you. Yes, Mr Donaghey.

PN396

MR DONAGHEY: Sir, do you wish me first and foremost to seek instructions as I do not have any about going into conference. This appears, at first glance, to be a workplace and a union and employer relationship which cries for a consultative committee or some kind of meeting of the minds. However, I am instructed on some of the matters - only some of which appear in the correspondence from the union - and I am instructed to make a brief outline to you about those matters.

PN397

THE COMMISSIONER: Okay. Why don't we deal with the matters you are instructed on and we will fly by the seat of our pants how we deal with the others.

PN398

MR DONAGHEY: If the Commission pleases. Mr Lobosco has been the subject of discussion on previous occasions. He underwent a skills trial. That skills trial occupied three days. It occupied three days in a position which Mr Lobosco was mooted to take over, if he had the skills. I understand from my instructors that that skills trial has now been concluded and the company has taken a certain view of the skills displayed by Mr Lobosco. Fundamentally their position has not changed, that the incumbent person, Mr Miles, ought to remain in that.

PN399

I think my learned friend's comments amount to having a bit of a second bite at the cherry because I understand that he was instrumental in setting up those persons to supervise Mr Lobosco's work performance and if he is now unhappy with the outcome then I am afraid I will have to hand it back to him to make any comments that he thought appropriate.

PN400

THE COMMISSIONER: Mr Lowe says that he believes that, I think it is, 3 supervisors - if that is what they are called - believe that Mr Lobosco would be able to pick up the job with some additional training. And some say that is - might be short training, I think he said one person said it might be a few month's additional training and then one person said that:

PN401

Well, he wouldn't be able to pick up the functions at all. It doesn't matter how much training you give him.

PN402

MR DONAGHEY: Understood, sir.

PN403

THE COMMISSIONER: The difficulty is is this, that what was brought to the Commission's attention last time was that the person who currently occupies the position is a person with much less service than Mr Lobosco.

PN404

MR DONAGHEY: That is right.

PN405

THE COMMISSIONER: He is also a relative, I understand, of one of the managers.

PN406

MR DONAGHEY: That I wasn't instructed about, sir.

PN407

THE COMMISSIONER: And so that puts a slightly different complexion - - -

PN408

MR DONAGHEY: Yes, it does, sir.

PN409

THE COMMISSIONER: - - - on the overall results.

PN410

MR DONAGHEY: It does, sir.

PN411

THE COMMISSIONER: Now, if it is a matter of some additional short training to Mr Lobosco, if that is the only issue, then the Commission's view puts Mr Lobosco in a front position because of the service, because of the relationship that the current person has and the length of service that Mr Lobosco has. Now all things being equal under the Act, in the Commission's view it would say that Mr Lobosco should be given that training. And if I note - I note the - I am not sure whether you have it, the typed note from Mr Lobosco himself that Mr Lowe gave me. I think you have got it there.

PN412

MR DONAGHEY: Yes, I do, sir.

PN413

THE COMMISSIONER: He says the only foreman that wasn't pleased with himself was Justin Lee, however he was trying to put the blame on, I assume, Mr Lobosco for a mistake that he made:

PN414

He said that I gave him extra components but I gave him the correct amount and Wayne -

PN415

that is Wayne Clue -

PN416

discovered that it was Justin who read the list wrong. Justin also left parts in the middle of the aisles on purpose that I -

PN417

that he, Mr Lobosco, would have to clean them up. Now maybe - can you get some instructions on those points that Mr Lobosco - - -

PN418

MR DONAGHEY: I certainly am. Would you like me to do that now, sir, or would you prefer that I wait to the end of the cycle.

PN419

THE COMMISSIONER: No, maybe if we could wait to the end. Yes.

PN420

MR DONAGHEY: Sir.

PN421

THE COMMISSIONER: Because you may need to get some further instructions on other matters.

PN422

MR DONAGHEY: I understand. In summary on Mr Lobosco, leaving aside the issue of a degree of relationship - as you know, sir, I am finding out about that for the first time.

PN423

THE COMMISSIONER: Sure.

PN424

MR DONAGHEY: I am only recently briefed in this matter. If the incumbent is some seven months through his training and if the incumbent has shown over the course of that training that he has reached a degree of skill that in the view of the company can only be reached by a far longer period of training, and those indeed are my instructions, sir, then we find the position where we have to apply the certified agreement and decided whether it would indeed be possible for the proposed replacement, Mr Lobosco, to perform those tasks as efficiently within a short period.

PN425

Complaints about the performance of Mr Lobosco are limited to those of familiarity, those of him being able to do that job, but unfortunately his job has a flow-on effect to other parts of the premises, other parts of the business. And in the interests of maintaining the flow of business it may be not possible, within the meaning of the certified agreement, to replace Mr Lobosco with - excuse me, to replace Mr Miles with someone who is likely to slow production and render more inefficient the balance of business.

PN426

THE COMMISSIONER: That wouldn't be the case, though, because you would have other people that would be experienced in that field that would be able to assist Mr Lobosco.

PN427

MR DONAGHEY: My instructions are that the creation of a position for Mr Miles was a bringing together of stock and other functions to create a single task. It would be hard to imagine in that circumstance, sir, that there would be others of equivalent skill or others of - doing the same tasks that might assist in the same way that co-workers might assist someone doing the same task - - -

PN428

THE COMMISSIONER: Well, how did Mr Miles learn it?

PN429

MR DONAGHEY: Another matter for instruction, sir. But I presume - - -

PN430

THE COMMISSIONER: Sure. Someone has obviously had to teach him.

PN431

MR DONAGHEY: It doesn't happen in a vacuum, sir, I agree.

PN432

THE COMMISSIONER: And who is Mr Kewell? What position does he hold?

PN433

MR DONAGHEY: I am instructed the store of parts, sir. So that would make him a supervisor, I presume, of Mr Miles and Mr Lobosco.

PN434

THE COMMISSIONER: Right. Yes. So he would be able to help Mr Lobosco in that field, wouldn't he?

PN435

MR DONAGHEY: I have no doubt.

PN436

THE COMMISSIONER: Sure.

PN437

MR DONAGHEY: I think one of the confusions of my friend, if you like, it really is borne out by the heading on the letter:

PN438

Re unfair dismissal of David Lobosco.

PN439

If Mr Lobosco has genuine complaints about this procedure and if he believes in all likelihood that he is - his employment has been unfairly terminated there is another avenue. I understand that the parties are coming together in order to settle this before any litigation was necessary but I raise that, sir, as it seems to be something quite relevant to 170CJ(3).

PN440

THE COMMISSIONER: Yes.

PN441

MR DONAGHEY: I will move on if the Commission pleases.

PN442

THE COMMISSIONER: See, I understand that argument, Mr Donaghey, but I would have to say that surely the obligation on the parties is to nip any application in terms of 170CE whatever it may - - -

PN443

MR DONAGHEY: CE/CK, I understand, sir.

PN444

THE COMMISSIONER: - - - CK, whatever, in the bud and that is an attempt made at this point by the union through a section 99 application. That is what the Commission is trying to do in saying, "Well, let us look at everything on a comparable level."

PN445

MR DONAGHEY: I understand, sir.

PN446

THE COMMISSIONER: I understand that the employer may say, "Well, if he thinks he has been unfairly dealt with make an application under unfair dismissal provisions," but by then the damage is done.

PN447

MR DONAGHEY: Understood, sir. I guess my point is not to be confused with questioning any jurisdiction of the Commission and certainly not questioning the efficacy of today's process, my point is this: this is number three. Mr Lobosco has featured prominently in despatches both in transcript and other places for some time. I am just a little surprised, sir, that it comes up so regularly and with such similar complaints. I would have thought - well, given the nature of the workplace that the issue of the skills test would have laid this to rest but obviously that has not been the case. I might move on, sir, to Mr Birrer.

PN448

THE COMMISSIONER: Sure.

PN449

MR DONAGHEY: I can understand that my learned friend seeks to turn his two years of service with the company into four. I don't sound to the agreement that there is any facility for the - an apprentice to be considered having served a longer period with the employer. So that might be something that is best dealt with either in conference or with other matters about which I am to get instructions. The only - from 24 March facsimile, sir, there are a number of issues that weren't raised in that fax. This is one. It is just a point, I guess, about time limits more than anything.

PN450

THE COMMISSIONER: Well, the - with Mr Birrer, though, I mean the questions put by the Commission, if they can be answered in terms - and I understand you may need to get instructions, but if Mr Birrer was not a direct employee - - -

PN451

MR DONAGHEY: It appears, sir, on my instructions he was not.

PN452

THE COMMISSIONER: No, he was employed under a group apprentice scheme.

PN453

MR DONAGHEY: Understood.

PN454

THE COMMISSIONER: And if that is the case and as soon as he completed his apprenticeship which may, as an example, have finished on Friday - - -

PN455

MR DONAGHEY: Yes. I understand.

PN456

THE COMMISSIONER: - - - on the Monday he rolled up to the same premises - - -

PN457

MR DONAGHEY: To start work again.

PN458

THE COMMISSIONER: - - - to start work again but as an employee of Burgess then at some point there would have been a pay out of his entitlements under the group apprenticeship scheme, whatever outstanding leave he may have accumulated and so forth. That needs to be confirmed.

PN459

MR DONAGHEY: Certainly.

PN460

THE COMMISSIONER: If that is the case, then it would be a good try on behalf of the union to try and get the two years as an apprentice carried over as service with the company but I am afraid in legal terms it would stand.

PN461

MR DONAGHEY: It is not. It would not stand.

PN462

THE COMMISSIONER: No.

PN463

MR DONAGHEY: And I am yet to understand the position of both parties in relation to this. These seem to be a lot of matters requiring micro-management. That, I would have thought, could be sorted in a telephone call. But I think - my preliminary instructions are, sir, that his entitlements and any pay out of them under the group training scheme, are something outside the nominative company and they may need to enquire further to fill out that picture.

PN464

THE COMMISSIONER: Sure.

PN465

MR DONAGHEY: Contracting out seems to feature prominently in my friend's submission. Rather than being a new innovation or something which emerged relatively recently, this is something that I am instructed has gone on for in excess of 12 months. In those circumstances it is hard to equate the submissions you have heard already, sir, about the downturn in business necessitating these recent terminations and redundancies, with any impact of the Salvation Army.

PN466

I understand why my learned friend might wish to bring them together but having done my duty, sir, looked at the certified agreement, looked at the underpinning award, I don't see that the contracting out can be made much of other than a negotiation and perhaps something to throw into the mix. The discussions that come around it could be, sir, that it has a lesser role in future. But my understanding from my instructions at this point are that it has continued on at this certain level for 12 months and it would be a change in system, a change in organisation which the business does not welcome.

PN467

THE COMMISSIONER: Is your argument, in substance, that outsourcing which occurs in a lot industries, much to the displeasure of a lot of people because it creates all sorts of problems, but the outsourcing whether it be to the Salvation Army or somewhere else at that point in time did not give rise to redundancies?

PN468

MR DONAGHEY: Sir, I am - - -

PN469

THE COMMISSIONER: That the redundancies arose at this point because of other factors?

PN470

MR DONAGHEY: Those are my instructions, sir, that there is a downturn in business which can be traced in a legitimate causative sense to these recent redundancies.

PN471

THE COMMISSIONER: Sure.

PN472

MR DONAGHEY: And whilst I understand that my learned friend's submission is in aid of his members, and so ought it be, I think to bring those two together in any kind of cause and effect sense is to widely overstate the mark by as much as 12 months.

PN473

THE COMMISSIONER: I note with interest that a number of companies that over the years have outsourced - and it is always on a cost basis because it is much cheaper and it looks good on their books that they have offloaded so many employees - now a large number of them are actually bringing the processes back in house.

PN474

MR DONAGHEY: Insourcing is becoming a buzz word, sir.

PN475

THE COMMISSIONER: Yes, because they have greater control over the outputs and the qualities and all that type of thing.

PN476

MR DONAGHEY: When your business is quality assurance then it may be that that is definitely required. One of the difficulties that outsourcing can in some circumstances create is an OH&S difficulty because, of course, in the textile industry you never really know what is going on.

PN477

THE COMMISSIONER: No.

PN478

MR DONAGHEY: And I understand from another matter that that is indeed being done, with all its attendant problems for the outsourced entity having to terminate much in the same way that previously happened with insourcer. But this seems to be more a pattern of work, sir, rather than a one-off, "Okay, let us chop this department," has has happened in banks, for example.

PN479

THE COMMISSIONER: Right.

PN480

MR DONAGHEY: I can't really take that submission any further.

PN481

THE COMMISSIONER: No, no.

PN482

MR DONAGHEY: I am sorry to say that Mr Anthony Costas is a person about whom I have only limited instructions so I think I had better leave that for some questions to my clients but I just - sir, to come to back to him would be probably the best idea in all of the circumstances. The final issue, sir, is overtime and it features in the letter of 24 March.

PN483

THE COMMISSIONER: Sorry, I - sorry, about that.

PN484

MR DONAGHEY: Sorry, sir.

PN485

THE COMMISSIONER: What was the issue, Mr Lowe, in terms of Mr Costas? You said it related to the quantum of redundancy.

PN486

MR LOWE: Well, we raised two issues, sir, if I can just digress. One that the company said that Mr Costas was selected because of his lack of skills as a sprayer.

PN487

THE COMMISSIONER: Right. But you say he had been dovetailing for a while.

PN488

MR LOWE: But last Friday was the first opportunity I have had to spend some time with the shop steward, now he tells me - my instructions are that in fact Mr Costas wasn't doing work as a shop steward - wasn't doing work as a spray painter for the last two to three years, he was actually doing dovetailing work.

PN489

THE COMMISSIONER: Right.

PN490

MR LOWE: So the issue that we raised here is that in respect of the - the attitude of the union would have been totally different in respect of - we didn't know the work he was doing. The reasons the company said that this person had to go was that he wasn't a competent sprayer.

PN491

THE COMMISSIONER: Right.

PN492

MR LOWE: Now he wasn't doing that work at the time and regardless of what my learned friend says about - and I will respond to that in due course - about the impact of contracting out, it just seems very strange to me that one of the jobs that he was doing over the last two or three years, after it was contracted out he is down the road. Now the other issue that I raised, sir, and there is no legal basis I guess for it, was that in trying to get a fair deal for this particular issue, ..... raised the issue of giving recognition on a proportionate basis for the length of service he had had with the company in respect of long service leave - - -

PN493

THE COMMISSIONER: Okay.

PN494

MR LOWE: - - - which I understand had been raised when this gentleman first sought a package when he was going through some difficult personal circumstances.

PN495

THE COMMISSIONER: Okay. This is the gentleman that the company said actually sought the redundancy.

PN496

MR LOWE: Yes, that is correct. That is the same gentleman, sir.

PN497

THE COMMISSIONER: Yes, thank you. Yes, Mr Donaghey, sorry.

PN498

MR DONAGHEY: I am now instructed to some extent, sir, about Mr Anthony Costas and my instructions are quite plain. That the allegations about the type of work he was doing are wrong. We will seek leave at the appropriate time, sir, to go into evidence about that, if the Commission pleases. Moving to the overtime issue, sir, my instructions about that may be summarised quite simply: the lamination sealing processes of the plant occur during certain hours of the day and finish in the early afternoon.

PN499

That means, sir, that the materials - the furniture so laminated is of course not dry by the end of the working day. That material cannot be wrapped in a practical sense whilst wet. The Commission would appreciate why that is the case being wrapped in plastic it would stick like glue. The trucks to carry away that furniture arrive at 7 am so the company solution has been to allow two employees, we are in excess of two years now, to arrive at an earlier time and wrap the newly dried furniture to allow for its removal.

PN500

The company has merely modified that practice slightly by adding two people, about 10 weeks ago - that is before the redundancies occurred, sir, to wrap and pack that material earlier in the day before the ordinary work starts. To describe it as overtime, sir, is a little bit exaggerated. Why? Because with the laminating running four days a week it is really only a little bit of time during the day, half an hour for two persons is scarcely any time at all and the inference that my friend chose to draw between that redundancies given both the time and the limited amount of hours per day that it is being undertaken is once again a bit of a stretch.

PN501

And I must express some sympathy with it because my friend is seeking to defend jobs but the truth of the matter is that it is an efficient way to practice. It is an efficient way to get the materials out, and it is in the interests overall of the company's business to do it just that way. I don't think - - -

PN502

THE COMMISSIONER: I thought the issue - sorry. I thought the issue was that it was being done by management.

PN503

MR DONAGHEY: That is an issue I am about to come to, sir.

PN504

THE COMMISSIONER: Sorry.

PN505

MR DONAGHEY: My instructions are that there are no supervisors doing that work, rather it is persons who are otherwise employed in the premise doing that work. I am getting a nod from my instructor, sir, just checking those instructions.

PN506

THE COMMISSIONER: Sure.

PN507

MR DONAGHEY: On those two issues and on other issues, sir, my instructor are a little bit taken aback by some of the allegations from the other end of the bar table and without wishing to prolong this terribly much, having expressed a desire to go into evidence, I must admit, sir, I did not prepare today on the basis that I would be examining or cross-examining so - - -

PN508

THE COMMISSIONER: No.

PN509

MR DONAGHEY: - - - I am bit hesitant to recommend it in those circumstances but it is a way of clearing up what is and what is not in a rapid fashion. To go back to Mr Lobosco, I understand from your comments were after my friend's submissions that you place great weight on the relationship between Mr Miles and one of the management team, one of the supervisor staff, I am informed by my instructor that Mr Lobosco himself was related to one of the union employees who has been on the selection committee for that skills test and in a sense that can tend to counterbalance some of the things my friend was saying about the degree of relationship between Mr Miles and others within the organisation.

PN510

I don't say, sir, that that completely puts the matter beyond any doubt but I do say it by way of introduction. The company maintains its position. Mr Miles is the better performer, that is an exception under section 16 of the certified agreement. They think it would not be possible to have Mr Lobosco in that position and seek to represent that to the Commission in the strongest terms possible.

PN511

THE COMMISSIONER: Right.

PN512

MR DONAGHEY: Those are my submissions.

PN513

THE COMMISSIONER: Thank you. Yes, Mr Lowe.

PN514

MR LOWE: The union's position in respect of Mr Lobosco, Commissioner, is that Mr Lobosco should be given the position and the position of working in the store. It is quite clear to the union that, all things being equal, with a short period of training, he will be as competent to do the job as the gentleman who is currently performing the duties in a - who has significantly lesser service than he does and that the last on, first off principle to apply where possible should occur in these incidents.

PN515

The company' representatives have not been able to establish that the matters raised by Mr Lobosco in his note dated 29 March are incorrect and that the minor errors that were made - or he was alleged to have made weren't in fact errors of his but errors of the foreman concerned. In respect of the heading of the letter, I just simply make the point to the Commission that this is a letter which has been prepared by an employee who has absolutely no understanding of the Workplace Relations Act, who has just simply seen that the way he was treated was being unfair so, you know, nothing else can be put on it other than that obviously he had his rights should he wish take the matter further depending on the circumstances.

PN516

In respect, Commissioner, to the issue of the supervisors doing the work, I am instructed too that they do do the work. Maybe this can be fleshed out between the parties in some form of conciliation or conference, Commissioner. The shop steward works on the factory floor. He has a better feeling and understanding of what goes on there than certainly I do.

PN517

THE COMMISSIONER: Who are they? What is their names? Who are the supervisors that do the work?

PN518

MR HANLON: Wayne Clue and Joe Calleja.

PN519

MR DONAGHEY: So they are the ones that actually do the packing in the plastic?

PN520

MR HANLON: Joe Calleja does the packing in the plastic.

PN521

THE COMMISSIONER: Right. And what does Wayne Kewell do?

PN522

MR HANLON: He works in the store area and he assists Steve Miles with all the pulling out the furniture and putting away the furniture.

PN523

THE COMMISSIONER: All right. And they are the ones the working the overtime?

PN524

MR HANLON: No. Overtime is the packing.

PN525

THE COMMISSIONER: Yes. So they are doing the overtime, doing the packing?

PN526

MR HANLON: No.

PN527

THE COMMISSIONER: So what are they doing?

PN528

MR HANLON: The supervisor - - -

PN529

THE COMMISSIONER: Yes.

PN530

MR HANLON: - - - doesn't do the overtime, the workers do the overtime.

PN531

THE COMMISSIONER: So who are the workers?

PN532

MR HANLON: Dimo Costandis and Peter Jones.

PN533

THE COMMISSIONER: Right. So they are not supervisors?

PN534

MR HANLON: No.

PN535

THE COMMISSIONER: Okay. So - the Commission got the view that it was the supervisors that were doing the time, that they were doing work that could have been done by employees.

PN536

MR HANLON: After the overtime, the supervisor actually does the work.

PN537

THE COMMISSIONER: Sorry, I am - - -

PN538

MR HANLON: Once overtime is finished and the job isn't completed, the supervisor comes in and takes over and finishes off the job that two people do with the overtime.

PN539

THE COMMISSIONER: By doing what?

PN540

MR HANLON: By wrapping the rest of the tops of the furniture - - -

PN541

THE COMMISSIONER: Well, that is what I am asking. The supervisors who do the wrapping?

PN542

MR HANLON: Yes.

PN543

THE COMMISSIONER: Right. That could have been done by employees?

PN544

MR HANLON: Yes.

PN545

THE COMMISSIONER: All right. So it is Mr Kewell and - - -

PN546

MR HANLON: Mr Joe Calleja does that.

PN547

THE COMMISSIONER: Calleja?

PN548

MR HANLON: Yes.

PN549

THE COMMISSIONER: He is one of the ones that have resigned?

PN550

MR HANLON: Yes.

PN551

THE COMMISSIONER: Yes.

PN552

MR HANLON: Both of them have resigned,

PN553

THE COMMISSIONER: Right. Okay. Thank you, Mr Hanlon.

PN554

MR LOWE: So the position is in respect of, I guess also the store, that there is a significant amount of work done by the supervisor in the store and so our concern has been, Commissioner, that at this time when workers have been laid off and that has an impact on the lives of them and their family, that the union has a concern about supervisors undertaking manual duties.

PN555

THE COMMISSIONER: Mr Donaghey says that that approximately - correct me if I am wrong, is about half an hour a day. Is that right? They come in prior to the shift.

PN556

MR DONAGHEY: And is more than two years old and is not really a major piece of manual work, I am instructed, it is more a finishing off in nature.

PN557

THE COMMISSIONER: Right. So it is - so - - -

PN558

MR DONAGHEY: So many objections.

PN559

THE COMMISSIONER: So if it is two hours a - half an hour a day we are looking at two and half hours a week. Is that right?

PN560

MR LOWE: Commissioner, I understand that there are employees who are covered by the enterprise agreement who come in for half an hour a day.

PN561

THE COMMISSIONER: Right.

PN562

MR LOWE: It is when their half hour is up and they have come in and they have - let us say they have a normal start time of 8 o'clock.

PN563

THE COMMISSIONER: Yes.

PN564

MR LOWE: They come in at half past 7 and they work till 8 o'clock doing the wrapping then they go back and start their normal job which may be spraying, it may be cabinet making, it may be something else.

PN565

THE COMMISSIONER: Right.

PN566

MR LOWE: Then the supervisors - - -

PN567

THE COMMISSIONER: Continue with the wrapping.

PN568

MR LOWE: Continue with the wrapping and with the work which is done in the store by the supervisor in assisting Steve, whose job we are challenging at the present time. What we are saying is that the work which is done by the supervisor, we would normally have no problem with, under normal circumstances. But we have a concern with that work - could have provided on-going employment for at least one or two of the employees who were made redundant. And those matters were never canvassed buy the Company, and there weren't, you know, dealt within trying to reduce the number of redundancies that occurred.

[1.55pm]

PN569

THE COMMISSIONER: How much time after the employees who come in and do the half hour overtime, they go back to the job, then how much time is spent by supervisors finishing off the wrapping?

PN570

MR LOWE: Can I get instructions?

PN571

THE COMMISSIONER: Sure.

PN572

MR LOWE: I am instructed that can take an hour to two hours during the day. The supervisor fits that in - - -

PN573

THE COMMISSIONER: Whenever they can.

PN574

MR LOWE: - - - where there is work, and comes backwards and forwards to - but it depends on the amount of product to be wrapped. But we have got probably a couple of supervisors doing that, up to a couple of hours a day.

PN575

THE COMMISSIONER: All right. If it is somewhere between an hour to two hours a day, what would - you say it equates to one full-time position, but it only occupies one to two hours a day, what does the employee do for the rest of the day?

PN576

MR LOWE: Well, Commissioner, we are pointing out that there are two people coming in, and they do the half hour. That is one hour. Then there is up to a couple of hours done by two of the supervisors. So that is - you are talking about five - around about five hours a day in work. Then there is the other work which Mr Birrer - - -

PN577

THE COMMISSIONER: Sorry, how do you get five hours out of that?

PN578

MR LOWE: Two supervisors.

PN579

THE COMMISSIONER: Yes, two, right. And one to two hours. That is not each, as I understand it.

PN580

MR LOWE: Well, I took that as each.

PN581

THE COMMISSIONER: No, that is - - -

PN582

MR LOWE: That is - I am sorry, and I apologise for that, yes.

PN583

THE COMMISSIONER: That is all half, and two do half an hour, so that is one hour.

PN584

MR LOWE: Yes. So at the most you are working a three - - -

PN585

MR LOWE: And then there is the work which is done in the general store by the supervisor, and maybe the shop steward can explain that a little bit clearer to the Commission, because I understand that quite a lot of the work which is done in the store, both the supervisor and the employee work together for a good portion of the day, Commissioner. I don't know whether Troy can provide the Commission with that information.

PN586

MR HANLON: The supervisor, Wayne Kewell, works in this actual store where Steve Miles works with the furniture componentry thing, and all day he assists in the pulling out of the furniture, bring in all the furniture, componentry, sorry, and it is - the whole job is probably a two man job. And one of the supervisors does this job.

PN587

THE COMMISSIONER: So how long has he been doing that?

PN588

MR HANLON: Since the component store has been open, which is - - -

PN589

THE COMMISSIONER: How long is that?

PN590

MR HANLON: About six months, seven months.

PN591

THE COMMISSIONER: Right, okay, thank you. Yes, Mr Lowe.

PN592

MR LOWE: Yes. So the point that we were trying to make about the two issues, about the issue of the overtime being worked, and about the issue of supervisors doing work, this has had an impact on the number of employees to be made redundant. And that, coupled with the issue of contracting out, you know, I guess had an impact on people like Mr Costas, who we have had no instructions on any response from the employer at that particular time.

PN593

THE COMMISSIONER: You have heard the employer say, through Mr Donaghey, that contracting out in this instance of the Salvation Army was in place over 12 months ago. And you said that the employer at the time said that it would not affect employment. And what the employer puts back is, well it hasn't. What has affected employment is that there has been other circumstances. That is a downturn in the industry and so forth. That has affected the employment.

PN594

It wasn't the outsourcing. Now if the outsourcing was in place 12 months ago, and nothing has occurred in terms of redundancies until the last few weeks, due to a downturn in the industry, then I mean, prima facie it would appear that the company is right. The outsourcing didn't affect the redundancies.

PN595

MR LOWE: Well, Commissioner, I am instructed that it hasn't been again a period of 12 months.

PN596

THE COMMISSIONER: Right.

PN597

MR LOWE: And that there was an agreement between the, I guess, the shop steward and the company, that there would be no effect on jobs. Now, the concern that has happened, that the people who are actually doing the jobs that have been contracted out, are now no longer there. Or at least one of them.

PN598

THE COMMISSIONER: But they are not there because, according to the company, because of other circumstances. That is, the downturn in the industry.

PN599

MR LOWE: I can't - I don't know what information was given to the union officials and the shop steward about the downturn in the industry. It appears to me that that matter hasn't been raised with Joe, and the shop steward was absent in respect of being on parental leave.

PN600

THE COMMISSIONER: Well, why else would there be redundancies?

PN601

MR LOWE: Well, if this contracting out of the work has had the impact that we probably believed that it has, that there was round about six people doing this work on a regular basis, during the time, and then that happens to be around about five to six people who are made redundant, according to the Company, through a downturn in the industry, if that work was to come back in, then there would be the jobs there for the six people. Now it might be drawing a long bow, Commissioner, but it is just that people get concerned when these issues aren't raised, and we didn't know about these particular issues, prior to the redundancies occurring, and when Mr Patti did raise the issue, and the way that I explained about the work that was being - going on in the prisons, and by other companies in the industry, taking it up, the Company never mentioned that at all. We didn't even know that it had happened. Obviously the shop steward did, but he was absent on parental leave.

PN602

THE COMMISSIONER: Mr Hanlon, how long do you think it has been outsourced?

PN603

MR HANLON: Eight months, six to eight months.

PN604

THE COMMISSIONER: Right. And the redundancies only occurred in the last few weeks, is that right?

PN605

MR HANLON: Yes.

PN606

THE COMMISSIONER: Right. And you work at the factory?

PN607

MR HANLON: Yes, I do.

PN608

THE COMMISSIONER: At the place?

PN609

MR HANLON: Yes.

PN610

THE COMMISSIONER: Has there been a reduction in orders?

PN611

MR HANLON: I think there may have been a reduction, slightly.

PN612

THE COMMISSIONER: Right, okay. Yes.

PN613

MR DONAGHEY: Sir, I am instructed by two people who are quite eager to do one of two things, either go into conference, or give some evidence about the things which they say are contested about my friend's submissions. And the preference, as I am instructed, is to go into conference. I understand that dovetails into what my friend was saying earlier. Would this be a convenient time to break before doing that, or would the Commission prefer to take some other course?

PN614

THE COMMISSIONER: I mean the Commission is happy to go into conference all the time. Obviously, because it sometimes can resolve issues, and more often than not it does resolve the issues. Yes, I will go into conference, thanks.

SHORT ADJOURNMENT [2.05pm]

RESUMED [2.51pm]

PN615

THE COMMISSIONER: The Commission did have an opportunity to have a conference with the parties. Arising from that conference, they have reached an understanding, the terms of which the Commission will not disclose. However, it is fair to say that the parties have agreed that this settles all matters in regards to the employment relationship of Mr Birrer, Mr Lobosco, and Mr Costas, save for any matter that might arise under workers' compensation or superannuation. The terms of the deed of release which will be signed, are to remain confidential.

PN616

It is not to set a precedent, and it settles all matters relating to the issue of recent redundancies. The rates that will apply as part of this settlement will be the rates that applied as at the date of termination. The Commission, in dealing with this matter, does accept the suggestion of Mr Donaghey, and it would be prepared to recommend that in order to improve the relationship between the Union and the Company, that a consultative committee, which the Commission understands is provided for under the EBA, be established as a matter of some priority to get the relationship back on track. Now, is that the understanding of the parties, Mr Lowe?

PN617

MR LOWE: Yes, Commissioner, that is the understanding of the parties, and the Union will prepare the documentation and forward that to the Company for signing, Commissioner.

PN618

THE COMMISSIONER: Right, and the Commission does note that the payment will be made within 14 days from the date of signing of the deed of release. Mr Donaghey, is that your understanding?

PN619

MR DONAGHEY: Save for one other matter, sir, that my clients have instructed that they wish the release to be mutual, to the effect that you said.

PN620

THE COMMISSIONER: Yes.

PN621

MR DONAGHEY: And that means that they may wish to have some input of the drafting of that release to ensure that it covers the relevant scope. If the Commission pleases.

PN622

THE COMMISSIONER: Sure. If Mr Lowe provides a draft to yourself, and taking into account the wishes of your clients, if it meets their needs, then fine. If not, there may need to be some adjustment.

PN623

MR DONAGHEY: As the Commission pleases.

PN624

THE COMMISSIONER: Yes. Mr Lowe?

PN625

MR LOWE: We would just, you know, advise the employees of what is going to occur and what we are dong, so - - -

PN626

THE COMMISSIONER: Okay, but you need to also, if you would, Mr Lowe, advise them of the strict confidentiality provisions. That is, that the only people who are entitled to tell about the settlement, are their accountant, their lawyer, somebody form the Taxation Office, or somebody who they may be required to by law. If they are queried by other colleagues, or ex-colleagues, they simply have to say that they settled. Okay?

PN627

MR LOWE: Understood, Commissioner.

PN628

THE COMMISSIONER: Okay. All right, thank you. The Commission thanks the parties and will stand adjourned.

ADJOURNED INDEFINITELY [2.54pm]