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Australian Industrial Relations Commission Transcripts |
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:(03) 9672-5608 Fax:(03) 9670-8883
TRANSCRIPT OF PROCEEDINGS
O/N 10447
AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION
SENIOR DEPUTY PRESIDENT WATSON
AG2003/5150
VARIATION OF CERTIFIED AGREEMENT
TO REMOVE AMBIGUITY
Application under section 170MD(6) of the Act
by Coles Myer Logistics Pty Limited to vary the
Coles Myer Logistics Pty Limited National Union
of Workers Woodlands 2002 Certified Agreement to
remove ambiguity
MELBOURNE
10.05 AM, MONDAY, 30 JUNE 2003
Continued from 4.6.03
PN232
THE SENIOR DEPUTY PRESIDENT: Yes, I note in correspondence from the NUW and AWU that they are no longer seeking to participate in the matter. Are there any other changes in appearance? No, we are where we were.
PN233
MR BOURKE: We understand that also the NUW are not going to attend today.
PN234
THE SENIOR DEPUTY PRESIDENT: Yes, NUW and AWU, yes, very well. Just one preliminary point. You may have noticed a 2 o'clock listing today. That matter has now gone to another day so we are free for the day. So let's start with Mr Bourke presumably.
PN235
MR BOURKE: Thank you, sir. Sir, can I tender as an exhibit our amended draft order.
PN236
MR BOURKE: Sir, I also tender the letter from the National Union of Workers of 27 June 2003 addressed to yourself.
EXHIBIT #CML7 LETTER DATED 27/06/2003 FROM MR DONNELLY OF NUW TO SENIOR DEPUTY PRESIDENT WATSON
PN237
MR FAROUQUE: Your Honour, I object to the receipt of that particular documentation. There were directions made by the Commission in relation to the filing of submissions and material before the Commission. In a sense, that document, whereas it notifies the Commission as to the non-appearance of the NUW at today's hearing, also goes somewhat further. It refers to a matter in respect of the intention of the NUW at the time of 2002 - - -
PN238
THE SENIOR DEPUTY PRESIDENT: And it is not by way of evidence, yes.
PN239
MR FAROUQUE: It is not by way of evidence.
PN240
THE SENIOR DEPUTY PRESIDENT: Well, I will accept the document. Obviously I understand what you are putting as to the nature of the statement by Mr Donnelly, but obviously it doesn't form the status of evidence in the sense that you are not able to cross-examine Mr Donnelly in relation to what is there stated. Yes, very well.
PN241
MR BOURKE: Your Honour, can I just say on that, in my submission, although that letter is not able to be tested, does not exclude - it is not a basis for exclusion, it is a basis for having it admitted, but a question of weight. At the end of the day, you may choose to give it no weight, but that should be a matter for your discretion, not for exclusion.
PN242
THE SENIOR DEPUTY PRESIDENT: Yes. Well, the document is admitted as CML7 and obviously submissions will be put in terms of what weight, if any, should be placed upon that statement.
PN243
MR BOURKE: Thank you, sir. Sir, I tender - you should have a folder, supplementary materials.
PN244
THE SENIOR DEPUTY PRESIDENT: I am sure I do, yes.
PN245
MR BOURKE: And we have an extra copy either as the exhibit or for marking. The initial supplementary materials folder, sir, had a tab E in the index, but no document behind it, and we forwarded to the Commission an amended index with a fourth affidavit of Peter Howell which has now just been placed behind this folder.
PN246
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Yes, my Associate has followed your instructions in relation to that and placed Mr Howell's fourth affidavit in the relevant spot. And that document should be marked?
PN247
MR BOURKE: Well, it could form part of the one folder, so if the folder was marked.
PN248
THE SENIOR DEPUTY PRESIDENT: Yes. I will mark the folder CML8 and obviously to the extent it contains evidentiary material which will be later subject of evidence and the content will be affirmed presumably by the relevant person.
EXHIBIT #CML8 FOLDER OF SUPPLEMENTARY MATERIALS WITH AMENDED INDEX
PN249
MR BOURKE: Now, there are two other documents, sir, which I wish to tender which we have only provided to the other side this morning. One - I hand up two copies of these - is a notice of initiation of bargaining period on the NUW dated 24 September 1996.
EXHIBIT #CML9 NOTICE OF INITIATION OF BARGAINING PERIOD DATED 24/09/1996
PN250
MR BOURKE: Sir, another is an open letter dated 18 September 1996 from the National Union of Workers.
EXHIBIT #CML10 OPEN LETTER DATED 18/09/1996 FROM NATIONAL UNION OF WORKERS
PN251
MR BOURKE: Your Honour, before I call our first witness, I will just say something about the amended draft order.
PN252
THE SENIOR DEPUTY PRESIDENT: Yes.
PN253
MR BOURKE: We inserted the additional qualification in the event it is to be later said that although persons such as Ms Bassett and Mr Ford were never treated as coming within the classification we set out in clause 12. They later argue that they, on an analysis of those classifications, come within those classifications. Our position is that the classifications should be read as the parties understood the classifications to operate and that they were not to include management employees and that is the purpose for that amendment.
PN254
THE SENIOR DEPUTY PRESIDENT: Very well.
PN255
MR BOURKE: That that be sorted out once and for all. Sir, I now call Tristram Gray
PN256
PN257
THE SENIOR DEPUTY PRESIDENT: Please take a seat, Mr Gray.
PN258
Yes, Mr Bourke.
PN259
MR BOURKE: I will just prove the affidavit subject to objections at the moment, your Honour.
PN260
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN261
MR BOURKE: Would you please state your full name, Mr Gray?---Tristram James Gray.
PN262
And your professional address?---Is 600 - sorry - 800 Toorak Road in Tooronga.
PN263
And your occupation?---General Manager, Employee Relations.
PN264
Now, sir, could the witness be shown the supplementary materials folder which is exhibit CML8, please.
PN265
THE SENIOR DEPUTY PRESIDENT: So it is exhibit CML8, tab C.
PN266
MR BOURKE: Now, do you have tab C there?---I do.
PN267
And is that an affidavit you affirmed on 23 June 2003?---It is.
PN268
And are you familiar with the contents of that affidavit?---I am.
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN269
And is it true and correct?---It is.
PN270
Just remain there.
PN271
I think there is now some objections to be taken, your Honour.
PN272
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Mr Farouque.
PN273
MR FAROUQUE: Your Honour, the particular paragraphs that I wish to object to are paragraphs - or parts of paragraph 21, 23, 24, paragraph 30 and paragraph - parts of paragraph 32, and I will go to the particular objection in turn. There are, in effect, two categories of objection. First in relation to paragraph 21, and I will read the relevant introductory part of that paragraph. Mr Gray says:
PN274
In this context, what was intended by myself and other representatives of Kmart and by the NUW -
PN275
and he goes on. I object to the part where he says "and the other representatives of Kmart and by the NUW". The basis of that objection being that Mr Gray cannot give evidence as to the state of mind of other people.
PN276
THE SENIOR DEPUTY PRESIDENT: Yes.
PN277
MR FAROUQUE: That is not a matter which he can give evidence of, so I object to that.
PN278
MR BOURKE: It is easier if we just do each at a time, sir.
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN279
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Mr Bourke.
PN280
MR BOURKE: Just in relation to that, in my submission that should be read as based on what was said and what was done by other representatives of Kmart and NUW rather than a mere speculation of their state of mind.
PN281
THE SENIOR DEPUTY PRESIDENT: Is that borne out by further evidence?
PN282
MR BOURKE: Well, if necessary, sir, I will lead further evidence on that point.
PN283
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Well, what I might do is strike out those words "and other representatives of Kmart and by the NUW" - - -
PN284
MR BOURKE: If your Honour pleases.
PN285
THE SENIOR DEPUTY PRESIDENT: - - - and if you need to address that issue by further evidence, you may do so. Mr Farouque, 23?
PN286
MR FAROUQUE: Again, your Honour, a similar objection in paragraph 23. The second sentence of that paragraph commencing:
PN287
It was the intent of the parties...
PN288
Again, a similar objection is made. Mr Gray purports to give evidence of the state of mind of, in effect, as I understand it, the NUW. Again I make the same objection.
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN289
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Mr - - -
PN290
MR BOURKE: Deal with it the same way, sir.
PN291
THE SENIOR DEPUTY PRESIDENT: Yes, we will deal with that the same way. I will strike that out, but you can deal with that by way of substantive evidence, Mr Bourke.
PN292
MR FAROUQUE: Again in paragraph 24, the second to last sentence commencing at the bottom of the page:
PN293
This is because it was never in the contemplation of myself and the -
PN294
and it continues -
PN295
and the other company representatives or of the NUW representatives that the 1997 agreement would cover management employees.
PN296
I object to the part where he - commencing with "and the other company representatives" and ending with "employees".
PN297
THE SENIOR DEPUTY PRESIDENT: So it is - yes. So we would leave in "This is because it was never the contemplation of myself that the 1997 agreement would cover management employees." Take out the reference to "and the other company representatives, NUW representatives" and deal with that in the same way, Mr Bourke?
PN298
MR BOURKE: Yes, thank you, sir.
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN299
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN300
MR FAROUQUE: Your Honour, I have an objection to paragraph 29. There is - Mr Gray at the concluding sentence of that paragraph says:
PN301
That a different form of words was eventually used in the two agreements was in my view the result of a difference in the drafting styles in the two bargaining units which negotiated the Woodlands 1997 agreement and the NGB Distribution Centres Agreement 1997.
PN302
In my submission it is clear from the whole of that paragraph that Mr Gray is not in a position to - well, firstly, it is an opinion that Mr Gray expresses; I object to it on that basis. A further objection is that he is not in a position to express an opinion in respect of that matter, and this relates to a distinction between terms of another enterprise agreement, being NGB Distribution Centre Enterprise Agreement, because on Mr Gray's own evidence he is not aware of the genesis of the express qualification contained in the NGB Agreement. He says he did not play a leading role in the negotiation of that agreement. He is simply not in a position to express that opinion. So that is a further objection we make. It is an expression of his opinion and it is not an opinion which can be founded on any factual matter because he is not aware of the genesis of that qualification.
PN303
THE SENIOR DEPUTY PRESIDENT: Yes.
PN304
MR BOURKE: That passage is not pressed, sir.
PN305
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Remove that passage. Mr Farouque, 30, I think.
PN306
MR FAROUQUE: And in paragraph 30 with - the concluding sentence:
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN307
...with, I believe, the intent of Mr Thow and the other NUW representatives.
PN308
THE SENIOR DEPUTY PRESIDENT: Yes, we will remove that again, Mr Bourke, unless you have some - - -
PN309
MR BOURKE: Thank you, sir.
[10.20am]
PN310
THE SENIOR DEPUTY PRESIDENT: And final paragraph, I think you had - - -
PN311
MR FAROUQUE: Yes. Just paragraph 32, where at the last sentence the expression, "nor of the NUW".
PN312
THE SENIOR DEPUTY PRESIDENT: Yes. Remove, "nor of the NUW" from the statement.
PN313
MR FAROUQUE: If your Honour pleases.
PN314
THE SENIOR DEPUTY PRESIDENT: Very well, thank you. Mr Farouque, you have some work to do.
PN315
MR FAROUQUE: Thank you, sir.
PN316
MR BOURKE: Thanks.
PN317
Mr Gray, do you have your affidavit in front of you? Could you go to paragraph 21, please?---Yes.
**** TRISTRAM JAMES GRAY XN MR BOURKE
PN318
You express a view about the phrase, comprehensive agreement?---I do.
PN319
That you did not consider it was intended to cover employees other than those contained in the classifications?---That is correct.
PN320
And you expressed the view, you believe that to be the view of other representatives of Kmart. On what basis did you form the belief that other representatives of Kmart had that view?---I formed that belief on the basis that I was leaving the negotiation team at Woodlands, at that time, and there were other representatives of the management team on that negotiating group. And we formed our negotiation approach together as a team. So I would have been aware, if any of those other management representatives on that team had a view that it ought to extend further than the classifications of those employees covered by the agreement.
PN321
On what basis did you form the view that the NUW had the same view about that expression?---I formed that view because the NUW never at any time during the negotiation, raised any claims for employees other than those covered by the classifications within the agreement.
PN322
In terms of the 1997 agreement, the Woodlands, were management employees treated as part of those classifications?---No, they were not.
PN323
I have no further questions, sir.
PN324
THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Bourke. Mr Farouque.
PN325
MR FAROUQUE: Mr Gray, you have been the Employee Relations Manager for Coles Myer Logistics from 1996 to 1998; is that correct?---That is correct.
**** TRISTRAM JAMES GRAY XXN MR FAROUQUE
PN326
And you have been the Employee Relations Manager for Retail Stores, Coles Myer from July 1998 to February 2000?---That is correct.
PN327
You are currently, or since February 2000, you are the Employee Relations Manager for the whole of Coles Myer Group; is that correct?---No, that is not correct.
PN328
You are the Employee Relations Manager for - you are the General Manager Employee Relations for Coles Myer Limited. Is that your current position?---Correct.
PN329
Yes. And that involves employee relations for the whole of Coles Myer Group, does it?---That is correct.
PN330
It does, okay. Now, Mr Gray, in those various positions that you have held, you have been involved in the negotiation of numerous enterprise agreements; is that correct?---Yes.
PN331
Okay. How many enterprise agreements would you say that you have been involved in negotiation of during that period?---Without being definitive of it, I would expect probably in excess of 30.
PN332
Thirty, yes. What I suggest to you, Mr Gray, is that you would have difficulty recalling what was said by a party during the course of a particular enterprise agreement negotiation, say, which occurred five years ago?
PN333
MR BOURKE: Well, I object to that. I think that is too general question, in terms of, recall what a party said. My learned friend should go to particular matters, as to the scope of an agreement, for example.
**** TRISTRAM JAMES GRAY XXN MR FAROUQUE
PN334
THE SENIOR DEPUTY PRESIDENT: Yes, I think, perhaps, Mr Farouque, it would be better directing questions to the particular agreement in contention.
PN335
MR FAROUQUE: If the Commission pleases.
PN336
Now it is correct to say, isn't it, Mr Gray, you say at paragraph 17 of your affidavit, you don't recall any discussions of the parties bound in area of operation clause of the 1997 agreement?---That is correct.
PN337
Yes, okay. Is it your evidence that - I withdraw that. Now, Mr Gray, you don't doubt that there could have been discussions of that matter during the course of the 1997 agreement, do you?---No, that is not correct.
PN338
Now, you agree, don't you, Mr Gray, that claims can change during the course of negotiations?---Yes.
PN339
Yes, okay. Different claims can be made at different time during the course of negotiations?---Yes.
PN340
And that new or changed claims can be made in drafts of documents which are forwarded by one party to another?---Yes.
PN341
I have no further questions for the witness.
PN342
THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Farouque. Anything arising?
PN343
MR BOURKE: No re-examination, sir.
**** TRISTRAM JAMES GRAY XXN MR FAROUQUE
PN344
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Thank you, Mr Gray for your evidence, you are excused from these proceedings, to the extent that you are able to be.
PN345
MR BOURKE: I call Mr Howell.
PN346
PN347
THE SENIOR DEPUTY PRESIDENT: Please take a seat, Mr Howell. Mr Bourke.
PN348
MR BOURKE: Mr Howell, would you please state your full name?---Peter Leigh Howell.
PN349
And your professional address?---800 Toorak Road, Tooronga.
PN350
And your occupation?---Employee Relations Manager for logistics.
PN351
Sir, could the witness be provided with the large folder, CML1, and the supplementary folder, CML8, please? There may be a separate CML2.
PN352
THE SENIOR DEPUTY PRESIDENT: Yes.
PN353
MR BOURKE: Or it may have been put behind tab 1, CML1.
PN354
THE SENIOR DEPUTY PRESIDENT: Yes, just one moment. So this first statement and attachments is - - -
PN355
MR BOURKE: Now, could you open up the large folder, Mr Howell, at tab 1.
PN356
THE SENIOR DEPUTY PRESIDENT: Just one moment, Mr Bourke, I have lost CML2. Thank you, I think we are back on track. Thank you.
PN357
MR BOURKE: Do you have there an affidavit you swore on 3 June 2003?---I do.
**** PETER LEIGH HOWELL XN MR BOURKE
PN358
And behind that is there another affidavit, or do you have a separate affidavit entitled, Supplementary Affidavit, in front of you? Maybe separately?---I do.
PN359
And is that sworn - - -?---Yes, it is.
PN360
- - - 3 June 2003?---Yes, it is.
PN361
And are you familiar with the contents of those affidavits?---I am.
PN362
And are they true and correct?---They are.
PN363
Now, can you close that folder. And go to this slimmer folder, Supplementary Materials. And do you have a tab B there?---Tab B?
PN364
Yes, you have - is that the other folder you have?
PN365
THE SENIOR DEPUTY PRESIDENT: B for Bernard. It will be marked with a yellow tab?---Yes, I do, sorry.
PN366
MR BOURKE: And is that your further supplementary affidavit sworn 23 June 2003?---It is.
PN367
And can you go to tab E. Is that your fourth affidavit sworn 27 June 2003?---It is.
PN368
And are the contents of those two affidavits true and correct?---They are.
PN369
THE SENIOR DEPUTY PRESIDENT: I should indicate for the record that the latter two affidavits, are further supplementary affidavit dated 23 June and the fourth affidavit - - -
**** PETER LEIGH HOWELL XN MR BOURKE
PN370
MR BOURKE: Sir, we have an extra copy of the amended index and the fourth supplementary affidavit of Peter Howell for that folder.
PN371
THE SENIOR DEPUTY PRESIDENT: Thank you. They form part of CML8, yes.
PN372
MR BOURKE: Correct.
PN373
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN374
MR BOURKE: Just remain there for us.
PN375
MR FAROUQUE: Your Honour, I just have two objections, one in relation to the affidavit dated 3 June 2003.
PN376
THE SENIOR DEPUTY PRESIDENT: That is the first or the - - -
PN377
MR FAROUQUE: That is the first affidavit.
PN378
THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. I have that.
[10.33am]
PN379
MR FAROUQUE: Paragraph 20 of that affidavit, your Honour.
PN380
THE SENIOR DEPUTY PRESIDENT: Paragraph 20.
**** PETER LEIGH HOWELL XN MR BOURKE
PN381
MR FAROUQUE: Again it relates to the intention of the NUW. The second sentence in that paragraph where Mr Howell refers to the intention of the NUW.
PN382
THE SENIOR DEPUTY PRESIDENT: So we strike out "and the NUW"?
PN383
MR FAROUQUE: Yes.
PN384
THE SENIOR DEPUTY PRESIDENT: Mr Bourke.
PN385
MR BOURKE: Well, if I could just - sir, in that paragraph he does indicate the basis of his intention which is the contents of the statutory declaration of the NUW.
PN386
THE SENIOR DEPUTY PRESIDENT: Yes. So the evidence is in relation to the statutory declaration.
PN387
MR BOURKE: And in my opinion that is the basis on which that evidence is to be read. The witness sets out the relevant matters in his statutory declaration that point to the fact that it did not cover management staff, it only covered traditional classifications. The NUW stat dec is in the same form, it says that reflects the common intention.
PN388
THE SENIOR DEPUTY PRESIDENT: Yes. Mr Farouque.
PN389
MR FAROUQUE: Your Honour, I am not objecting to the tender of the statutory declaration. Insofar as Mr Howell goes on and seeks to divine from that what the intention of the NUW is, it is not a matter that he is in a position to give evidence about their state of mind.
**** PETER LEIGH HOWELL XN MR BOURKE
PN390
THE SENIOR DEPUTY PRESIDENT: Well, it is, is it not, to the extent that it is derived from his understanding of the statutory declaration. Now to the extent you have a different position and - - -
PN391
MR FAROUQUE: That is a matter, your Honour, we say for submissions and for a matter of inference, not for a matter of a witness to project into the mind of another party as to what their intention was. At best, he is expressing an opinion, and in my submission that material is objectionable and should be excised.
PN392
THE SENIOR DEPUTY PRESIDENT: Yes, well, I will leave the reference to the NUW in the statement. It is an expression of his opinion, but the basis for that opinion is disclosed.
PN393
MR FAROUQUE: If the Commission pleases. Now, I want to go to the first supplementary affidavit, your Honour.
PN394
THE SENIOR DEPUTY PRESIDENT: Yes, thank you. That is CML2.
PN395
MR FAROUQUE: The paragraph 17 and the last - page 5 of that affidavit - - -
PN396
THE SENIOR DEPUTY PRESIDENT: Yes.
PN397
MR FAROUQUE: - - - where again Mr Howell gives evidence as to the intention of the NUW. Again I object to that on the same basis as I have objected to his other expressions as to the intention of the NUW.
PN398
THE SENIOR DEPUTY PRESIDENT: Yes, Mr Bourke.
PN399
MR BOURKE: We don't press that, sir.
**** PETER LEIGH HOWELL XN MR BOURKE
PN400
THE SENIOR DEPUTY PRESIDENT: Very well, I will excise the final - it is the final sentence, is it, Mr Farouque?
PN401
MR FAROUQUE: Yes.
PN402
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN403
MR FAROUQUE: If the Commission pleases.
PN404
THE SENIOR DEPUTY PRESIDENT: Mr Bourke, is there any further examination-in-chief?
PN405
MR BOURKE: Sir - no, sir. The matters in relation to the NUW are dealt with earlier in the affidavits and we would just rely on those materials.
PN406
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN407
MR BOURKE: No further questions.
PN408
PN409
MR FAROUQUE: Thank you, your Honour.
PN410
Now, Mr Howell, you are familiar with the terms of the 2002 - if I can call it the 2002 Woodlands Agreement?---Yes, I am.
**** PETER LEIGH HOWELL XXN MR FAROUQUE
PN411
And you are also familiar with the terms of the 1997 and 2000 agreements?---Yes, I am.
PN412
Yes, okay. You accept that the parties bound and application clause of the three agreements that I referred to - the 2002, 2000 and 1997 agreements - are identical?---Yes, they are.
PN413
Yes. They did not change during the course of those three instruments?---No, no, they didn't.
PN414
I want to suggest to you, Mr Howell, that your intention when you negotiated the 2002 agreement was not to change the extent of coverage as set down in 1997 and 2000 agreements?---That is correct.
PN415
I have no further questions for the witness.
PN416
THE SENIOR DEPUTY PRESIDENT: Very well. Thank you. I take it there is nothing arising?
PN417
MR BOURKE: No re-examination, sir.
PN418
THE SENIOR DEPUTY PRESIDENT: Yes. Yes, thank you, Mr Howell, you are excused from these proceedings.
PN419
MR FAROUQUE: Your Honour, one other matter that I want to raise.
PN420
THE SENIOR DEPUTY PRESIDENT: With Mr Howell?
**** PETER LEIGH HOWELL XXN MR FAROUQUE
PN421
MR FAROUQUE: With Mr Howell; it shouldn't take too long.
PN422
THE SENIOR DEPUTY PRESIDENT: Yes, I am sorry, Mr Howell, you - - -
PN423
MR FAROUQUE: I let him go a bit too early.
PN424
THE SENIOR DEPUTY PRESIDENT: You are not excused and the oath remains in force.
PN425
MR FAROUQUE: Mr Howell, you refer in your affidavit to a previous claim which was made by an employee - a former employee of Coles Myer Limited for benefits under the 2000 certified agreement?---Yes.
PN426
That was a claim for redundancy benefits; is that correct?---It was a claim for an increased payout as a result of redundancy, yes.
PN427
Yes, okay. And that was a claim made under the severance or redundancy clause of the 2000 agreement; is that correct?---Yes, it was.
PN428
Yes. Mr Howell, that claim was made in 2002; that is correct, isn't it?---Yes.
PN429
And it was resolved in 2002?---Yes.
PN430
I have no further questions.
PN431
**** PETER LEIGH HOWELL RXN MR BOURKE
PN432
MR BOURKE: Was the settlement of the claim with any admission of liability?---No, it wasn't.
PN433
No further questions.
PN434
THE SENIOR DEPUTY PRESIDENT: Yes, very well.
PN435
Thank you for your evidence, Mr Howell, you are excused from these proceedings.
PN436
MR BOURKE: That is the case for Coles Myer Logistics.
PN437
THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Bourke. Mr Farouque.
PN438
MR FAROUQUE: Your Honour, you will have with you, I believe, a folio entitled Submissions on Behalf of Ms Sandra Kaye Bassett and Mr Wayne Ford.
PN439
THE SENIOR DEPUTY PRESIDENT: Yes, I do.
PN440
MR FAROUQUE: Thank you. Your Honour, that folio of documents contains submissions on behalf of Mr Ford and Ms Bassett. It also contains an index of 20 documents including a statement of Ms Sandra Bassett. My learned friend has indicated - or my learned friend's instructors indicated that they don't require Ms Bassett for cross-examination. I do have, your Honour, a copy of the witness statement in affidavit form which I will tender to the Commission. There is no change to the substance of that document or the exhibits thereto, and I would seek to hand that up and tender that document, your Honour.
PN441
THE SENIOR DEPUTY PRESIDENT: Yes. Well, I will mark the sworn affidavit of Ms Bassett of 15 paragraphs sworn on 27 June, to which there are attached various attachments, exhibit MK1.
EXHIBIT #MK1 AFFIDAVIT OF MS BASSETT SWORN ON 27/06/2003 WITH ATTACHMENTS
PN442
THE SENIOR DEPUTY PRESIDENT: Now, do we need to mark the folder and - - -
PN443
MR FAROUQUE: Yes, your Honour, it might be convenient to mark the folder.
PN444
THE SENIOR DEPUTY PRESIDENT: We will mark the folder provided exhibit MK2, and that folder consists of an outline of submissions on behalf of the interveners, Ms Bassett and Mr Ford. It contains a statement of Ms Bassett which has now been separately marked in sworn form MK1. Otherwise contains a series of 19 other documents which are indexed at the commencement of the document.
EXHIBIT #MK2 FOLDER CONTAINING OUTLINE OF SUBMISSIONS ON BEHALF OF INTERVENERS, STATEMENT OF MS BASSETT AND SERIES OF 19 OTHER DOCUMENTS
PN445
MR FAROUQUE: If the Commission pleases. I am in your hands, your Honour, that is, in effect, the case for the applicant.
PN446
THE SENIOR DEPUTY PRESIDENT: Yes.
PN447
MR FAROUQUE: I understand my learned friend will want to make some submissions and I indeed also wish to make some submissions.
PN448
THE SENIOR DEPUTY PRESIDENT: Yes, I can understand that, yes. Very well, we will go to submissions.
PN449
THE SENIOR DEPUTY PRESIDENT: Mr Bourke.
PN450
MR BOURKE: Sir, as I said about the amended order sought, that is to confirm that clause 3, the application clause, was directed to classifications referred to in clause 12 of the certified agreement and that those classifications were not intended to include management employees, and we have made that even more clear, not intended to include people such as a human resources manager and a human resources officer.
PN451
There was, in fact, a previous certified agreement which had an express reference that management employees were not to be included, and an example of that is the Kmart 1997 Agreement, clause 3, which is at tab 11 of the Bassett/Ford folder.
PN452
THE SENIOR DEPUTY PRESIDENT: Yes, MK2, yes.
PN453
MR BOURKE: Now, I deal first with the question of jurisdiction under 170MD(6) to vary a certified agreement to remove ambiguity or uncertainty. The first point we make is that that is an extremely low threshold to meet. That does not seem to be in dispute. Currently you have sets of submissions where we say our construction is the best in terms of that employees was intended to mean classified award areas and not management and theirs just makes the threshold. They are saying their construction is unarguably correct and our argument doesn't get to the threshold, and we say this is a classic case where, in fact, both arguments don't matter. You do not have to determine which is the best argument, that both arguments at least meet the very low threshold in terms of if there is an ambiguity or uncertainty.
PN454
One can analyse these things intellectually, but at the end of the day the proof is in the pudding in that if this was so cut and dry, you expect one of the sides to just do a couple of pages of submissions because it is just open and shut, but what we have, just to test the other side's argument, they have done substantial material, filed evidence, and generally as a rule of thumb you don't to go extrinsic evidence, such as the surrounding circumstances, unless there is some ambiguity. That is a general rule of construction. But they have even accepted that they were entitled to look at previous conduct, previous wording of earlier agreements to confirm the true construction.
PN455
Now, in the well known Kodelfa approach, that seems to be a concession that there was sufficient ambiguity to justify looking outside the actual words of the document. We say this is a case where you can look at the surrounding circumstances, and negotiations point to one thing only, that management was not to be included, it was to be the classifications, and that that reflected the actual intention of the parties, being Logistics and the NUW.
[10.47am]
PN456
I might just make one point on that whilst it is fresh in everybody's mind because critical is going to be the actual intention. We have evidence from Mr Gray and Mr Howell the intention of Logistics was clear. They observed no conduct of, the NUW suggests, a contrary intention and in relation to the 2002 agreement we have Mr Howell being the front man, saying no one ever indicated any other intention than to cover classified employees but, very importantly, there was somebody else there during these 2002 negotiations and that was Mr Ford.
PN457
He has a clear, vested interest to come along and say hang on a minute, I remember Mr Thow saying X, Y and Z, management would be covered; I remember thinking hang on, this concerns me. Something like that would have been worth a million dollars in evidence. In our submissions in reply, we - - -
PN458
THE SENIOR DEPUTY PRESIDENT: I am not sure the redundancy provisions are that generous but go on.
PN459
MR BOURKE: That is right. In our submissions in reply, we pointed out hang on a minute, you have not called Mr Ford and he is there when this deal is being cut and we will draw an adverse inference, Jones v Dunkel. And I must say we anticipated, well, okay, they will see that and they will think we will have to call Mr Ford, but they did not. Now, that is devastating, no explanation why Mr Ford is not being called when he is perfectly placed to say this was the real intention.
PN460
Very interesting, your Honour - I don't criticise my learned friend for this but when Mr Howell is there in the witness box and he is the man at the scene negotiating the agreement, the question put to him was not listen, the intention of this agreement was to cover everybody, including management. That is really what their case is. That is not the question that was put. My learned friend is bound to only put his instructions. The question was very carefully crafted and was: your intention was not to change the extent of coverage, when Mr Gray and Mr Howell had made it clear that the earlier two agreements with the same wording have never been considered to cover management and have never been applied that way to cover management.
PN461
Very carefully crafted, and the answer went without saying: of course there was no intention to change. But there was not the direct puttage of what is really their case, where they say the true intention was to cover management. That was not put to Mr Howell and Mr Ford hasn't come along to say anything to the contrary. So what you have is undisputed evidence of Mr Gray and Mr Howell as to the historical evolution, the critical three documents, the inference open in not calling Mr Ford and the only other evidence is the NUW - and we have led evidence how they behaved, which has not been contradicted - and no direct challenge to Mr Howell, and, for whatever weight you want to put on it, you have the letter from the NUW.
PN462
When it comes to deciding whether rival contentions are arguable, you will not find in the law a lower threshold than arguable. That is the lowest. Not prima facie but arguable is the lowest threshold that can be fixed in the law. All it has to mean is that it is not an aim that can be rejected out of hand as hopeless or not worthy of argument, not worthy of consideration. And we say even saying if their case is the best, our argument has got to be worthy of consideration. Now, the test is as set out - if I can go to what is exhibit CML5, which is our authorities folder, at tab 1, the PTC decision, at page 4.4:
PN463
In our view, the approach adopted by his Honour Gray G in the PKIU case is a sensible one and should be applied by the ...(reads)... case can be made out for more than one contention.
PN464
Now, the reason for, clearly, the low threshold - and I will take you to the cases later, but the Commission is in the best position to sort out this type of controversy and clarify it by inserting words into the agreement. Otherwise, the parties are faced with going to the Federal Court and arguing the case without the benefit of that clarification. And the Federal Court has said on a number of occasions, the Commission is in the better position because it can insert a clarification.
PN465
When you look at ambiguity, it doesn't bear authority. You don't just look at a word in isolation or a word in a paragraph, which is really what they have done. You look at it in its total context. You look at it in terms of all the circumstances surrounding the agreement and the whole agreement and when you do that, it all points to one thing and that is that management was just not even on the horizon. That point, your Honour, is made in the Coles Myer case, at tab 7, by Commissioner Whelan at page 3.7, the paragraph starting:
PN466
In my view, applying the general test that ...(reads)... needs to look at the words used in the context of the whole agreement -
PN467
And you won't see any submission where there is any reference to any other part of the agreement in the Bassett Ford submissions. They only rely upon in the context of that one clause.
PN468
and not simply determine if the words themselves are capable of more than one meaning. The question, after all, is whether the language renders the agreement to be uncertain.
PN469
In this issue - and this is important - this is not only an issue about whether Bassett and Ford can get a top-up by way of redundancy from the redundancy pay they have already received under the relevant company policy. If they are right that it covers management, there is a whole myriad of provisions which would need to kick in so that senior management - and on their analysis, from the managing director down, are on a 36 or 38-hour week, overtime, meal allowances, shift arrangements and cuts across what - where management were paid by way of salary, suddenly they will become wage earners and it would have caused a revolution in terms of the way management are treated.
PN470
We have in the material that Ford and Bassett were required to ensure that Logistics complied with their obligations; no suggestion they ever said, over the last five years that this regime has been in, of this agreement and the previous two agreements, hang on a minute, we have got to start paying our managers overtime, etcetera, or meal allowance, etcetera, etcetera. That - again there is no challenge to that suggestion.
PN471
So we say we meet the jurisdictional threshold, that enlivens your discretion and the discretion should be exercised to reflect the true intention so that no one steals a march on the basis of what might be ambiguous or uncertain drafting. That point is made in the Tenix decision, at tab 3, paragraph 54:
PN472
As we have identified an ambiguity or uncertainty in the agreement, it is now a matter of discretion as to whether or not the agreement should be varied ...(reads)... regard to the mutual intention of the parties at the time the agreement was made.
PN473
We say the evidence is overwhelming that the actual intention of Logistics - and we have led the inferred intention of the NUW, plus we have got the letter - given their conduct and the absence of the Ford evidence, the mutual intention was that management was not to be covered; it was the employees who were traditionally recognised as working within the classifications in clause 12. We have provided the evidence that there is a clear demarcation at Logistics and has been for many years as to who are treated as management and who are treated as storepersons and we had material as to the hierarchy in our large folder, CML1, tab 2, the organisational chart and that these are clearly treated as management.
PN474
And at rung 2 you have Wayne Ford, rung 3 you have Sandra Bassett. And we provided evidence by way of there is a complete different software system, salaries are paid through head office in relation to management and award persons paid on site under the wage payroll system. We have also provided an extract from Codelfa, tab 8, because the exercise of discretion is very similar to an act of rectification at common law, changing an agreement which it could be said is not drafted in terms of actively reflecting the true intention of the parties. That issue is dealt with in Codelfa by Mason J and at 352 at point 3 there is first the reference to:
PN475
Does the difficulty arise in respect of evidence of prior negotiations? ...(reads)... which were known to both parties in the subject matter of the contract.
PN476
Now, in relation to that, we rely on the fact that the negotiations give you an understanding of what the subject matter of the contract was and that working back from that, although there is the reference to employees, it is understood in the context of the negotiations it was not management but the traditional classifications recognised. Then if one goes to the last four lines of that paragraph:
PN477
The object of the parole evidence rule is to exclude them, the prior oral ...(reads)... admissible in an action for rectification.
PN478
So that one can go to what was the actual intent of the parties and rely upon that in terms of rectification. Now, my learned friend's argument, which virtually heavily relies upon the actual language in the particular application clause - the danger of that has been highlighted by Munro J in Rheem, at tab 9 - indicates that often the application clause is something that people - people apply their mind heavily to who gets what pay rise and so forth but often whack out in pretty sloppy or lax fashion the application clause, and his Honour noted that when looking at a question of certified agreement at tab 9, paragraph 27:
PN479
The identification of the work so regulated is a function of the application of the relevant agreement ...(reads)... There is no readily apparent reason why the application of a certified agreement should not be expressed clearly.
[11.04am]
PN480
And it could be said in a perfect world the agreement should have been drafted as per our proposed varied order, but we say it is apparent from all the surrounding circumstances and the agreement as a whole that was its intent.
PN481
One of the matters we point to in terms of showing the distinct organisational arrangement is the fourth affidavit of Mr Howell which hopefully has found its way into exhibit CML8, the slim folder, supplementary materials folder - - -
PN482
THE SENIOR DEPUTY PRESIDENT: Yes.
PN483
MR BOURKE: - - - where we have exhibited examples of a prior agreement, employment agreement, involving Ms Bassett when she was a Personnel Officer, and the agreement of the Human Resources Manager, Mr Ford, and they are extensive agreements of an entirely different character. This is at tab E at the back; do you have that, sir?
PN484
THE SENIOR DEPUTY PRESIDENT: Tab E, yes, yes.
PN485
MR BOURKE: Is there a document there?
PN486
THE SENIOR DEPUTY PRESIDENT: There is, yes.
PN487
MR BOURKE: If one goes to PLH5, you see the type of agreements that are provided to management where they have a remuneration package, it goes through all their entitlements. There is no suggestion of overtime, that type of thing. Then if one goes to PLH6, a similar type of agreement for Mr Ford. And then if one goes to PLH7 where we have chosen an example of a person working under a classification. They are told they are a permanent storeperson. The position is in a classification stated, storeperson grade 2, it is a fairly brief document, recognising that it is one that goes to the award and certified agreement really for relevant entitlements.
PN488
And the storeperson - the classifications in the agreement mirror the classifications in the award which were provided in the large folder at tab 7, clause 16; that is CML1. You can't go past just the appellation of the position, store worker, in respect of the way they might be described. It is a big jump to say that those classifications include Human Resources Manager and Human Resources Officer.
PN489
We have also provided the evidence which is unchallenged that it is the NUW who we negotiated the agreement with, and that in the past, to the best of our belief, NUW has not represented management. So when they use the expression, "employees", they are talking about in the context of their own coverage, which is fundamental to a union that they cannot act on behalf of people beyond the scope of their coverage. That point is made about the role of the NUW and who they traditionally represent at Mr Howell's first affidavit at paragraph 8.
PN490
In addition to that overwhelming evidence on the surrounding circumstances and the intent, we have documents in permanent form. At tab 3 of our large folder, CML1, you have really the document that sets out the scope of the negotiations, the notice of initiation of bargaining period of 18 June 2002 where in the middle of the page at paragraph (b) - second paragraph (b):
PN491
The proposed agreement shall be binding on the NUW and warehouse workers -
PN492
now, that expression doesn't include the HR Manager -
PN493
employed under the Retail Warehouse Award.
PN494
Now, that is a recognition of the level of employee you are looking at for application, and really it is a nonsense to suggest it could cover management. Then you have on 15 July 2002, paragraph 14 of Mr Howell's affidavit, a meeting of storepersons by the NUW to discuss the in-principle agreement, so no involvement of management. And this is undisputed, paragraph 14 of Mr Howell's first affidavit, 29 August 2002 a vote of storepersons. Management did not attend and there was no attendance by Ford or Bassett and that reflects that it was clearly understood that they would not be the subject of the agreement.
PN495
Now, in our submission you have to presume that Logistics and the NUW would conduct themselves to ensure that their conduct in terms of the process of certify agreement was lawful and that you should err on the side of construing a document that ensured its validity as against from invalidity, and the clear requirements of the Act are that the persons subject of the agreement have to be involved in the vote, and if management employees are covered, then the agreement is invalid. They have not been part of the information or voting process.
PN496
The only people that have been part of those that were traditionally recognised as working in those classifications, and that requirement is spelled out at 170LI(1)(b) where it:
PN497
...must cover all persons who at the time when the agreement is in operation are employed in a single business or part of a single business and whose employment is subject to the agreement.
PN498
And then one goes to 170LE, it talks about:
PN499
A valid majority of persons employed at the particular time whose employment is or will be subject to an agreement.
PN500
That has not been complied with if management are covered as distinct from people traditionally recognised in the classification. And there is a requirement under LJ(2):
PN501
The agreement must be approved by a valid majority of persons employed at the time whose employment will be subject to the agreement.
PN502
If one goes also to LT(5), one of the requirements to be satisfied in terms of certification, second line:
PN503
The majority of persons employed at the time whose employment would be subject of the agreement must have genuinely approved the agreement.
PN504
Now, on the evidence which was undisputed, management weren't involved in any shape or form. We have provided you in a supplementary folder CML8 with a decision of a Full Bench of the Commission at tab A2 in Energy Developments where this issue was raised in relation to an LK agreement.
PN505
THE SENIOR DEPUTY PRESIDENT: I am sorry, that was to be found where?
PN506
MR BOURKE: Sorry, smaller folder, CML8, supplementary materials of the applicant.
PN507
THE SENIOR DEPUTY PRESIDENT: Yes. In tab?
PN508
MR BOURKE: In tab A2.
PN509
THE SENIOR DEPUTY PRESIDENT: A2, yes, thank you.
PN510
MR BOURKE: This was an LK agreement where a couple of people were left out of the voting process, and even though it may not have changed the voting outcome, the agreement was found to fall to the ground, and that is discussed at paragraph 23 by the Full Bench, that even if it didn't change the result, it would still cause invalidity. And they make the point that in contrast to an election where there might be some flexibility whether to make the election void or not, there is no discretion in the Act. At paragraph 23:
PN511
In this case we are satisfied that not all of the employees whose employment will be subject to the agreement participated in the agreement making process ...(reads)... This position may be contrasted with that pertaining to election inquiries -
PN512
and then that point is made.
PN513
There is no similar provision in relation to the requirement that a valid majority of employees make the agreement.
PN514
So on their construction, this agreement falls to the ground. On Ms Bassett's evidence, she did not have any idea she was covered and Mr Ford hasn't said anything. So if you read the application clause, having in mind that it should be read to give it validity, there is only one way to construe it and that is construe it to apply to those traditional classifications that have been recognised and not to management.
PN515
Now, the other evidence which is in a strong paper trail in permanent form is at tab 4. You have the statutory declaration of Logistics which was filed with the Commission, and if one - that is the other large folder, sorry.
PN516
THE SENIOR DEPUTY PRESIDENT: Yes, that is fine.
PN517
MR BOURKE: CML1.
PN518
THE SENIOR DEPUTY PRESIDENT: Thank you.
PN519
MR BOURKE: And if one goes to paragraph 6.1 on page 4 there is a reference to the genuinely approved valid majority and there is a discussion of the in-principle agreement that was reached with the company and elected employee representatives. Mr Howell in paragraph 17 of his first affidavit has stated that that committee involved only award people and not management.
PN520
And then one goes to 6.3, there is a reference to the total number of people employed - you couldn't get this any more clearer - is 286. He gives evidence in paragraph 18 of his first affidavit that there was 23 management persons at that time and that if they had have been covered the figure would have been 309. So there is a clear indication there in terms of the ancillary material to the certified agreement as to what the coverage is for.
PN521
Then if one goes to 7.1, it is:
PN522
Are the terms and conditions of employment of employees covered by the terms of an award or state award?
PN523
And in relation to management, which on their case you could go right to the top, clearly they are not covered by awards, but there would need to be some qualification. But in fact the answer is:
PN524
Yes. Storage Service Retail Victorian Warehouse Award.
PN525
Now, that would not be correct as management was award - - -
PN526
THE SENIOR DEPUTY PRESIDENT: Presumably there would need to be some designation in relation to employees not covered by the Warehouse Award.
PN527
MR BOURKE: That is right, in order to do any type of comparison.
PN528
THE SENIOR DEPUTY PRESIDENT: Yes.
PN529
MR BOURKE: And the suggestion is everybody was covered by the award. Now, you then have at tab 5, and we say this is very good evidence of common intention with the NUW, a statutory declaration in identical form in terms of number of employees and whether they are covered by the award or not. We say that is exemplary evidence, material filed in support of the certified agreement.
[11.19am]
PN530
And then you have at tab 6 the decision of Deputy President Leary at paragraph number 22 at tab 6:
PN531
Accordingly, pursuant to section 170LJ of the Workplace Relations Act the agreement is to be ...(reads)... The parties to the agreement are Coles Myer Logistics, the NUW and the employees covered by the classifications therein.
PN532
And that was entirely consistent with the material put before the Deputy President and there was no objection to that characterisation of the agreement by the parties who were before the Deputy President.
PN533
Then could I go to tab 8, which is the agreement itself. At page 3 you have the relevant clause which we say needs to be read in its context and also read in the context that the agreement is made with the NUW and their traditional coverage at Logistics and its officers and members. But if one goes further through the agreement, the idea that it covers everybody does not sit comfortably.
PN534
You then have relationship to awards clause 7 shall be read wholly in conjunction with the 1981 award which deals with the award classifications which are set out in clause 12. Then one goes to Mr Howell's first affidavit, paragraph 36, there is a reference to all the breaches that would be caused and have been caused over the last five years if the Bassett/Ford construction is correct. Mr Ford's first affidavit is at tab 1 of that large folder - sorry, Mr Howell, sorry, and at paragraph 36 the point is made that Ms Bassett and Mr Ford are in a position to raise these issues of breaches regarding the 2002 agreement.
PN535
Clause 11.1 which talks about weekly, part-time, limited and casual employees contrasted with management who are paid by the month. And then one goes - this is not set out here, but if one goes to clause 18 in the agreement, it talks about wages and wage increases for various classifications. There is no mention - that is at page 20 at tab 8 - there is no mention of any type of management person getting a pay rise, and it talks about wages as distinct from salary.
PN536
Then one goes to clause 25, Introduction of a Sick Leave Bonus Scheme, which has never been applied to management employees. If one goes to clause 26.1, they will work a 36-hour week where management are not on a fixed 36-hour week, and then there is provision - clause 34 - for overtime where management have not in the past received overtime. And then there is clause 20 regarding a meal allowance; no such entitlements ever been recognised for management.
PN537
And if I could take you to clause 60 of the agreement, which is page 51, there is a type of demarcation indicated there:
PN538
Management handling cartons. It is acknowledged that on occasions it is necessary for members of the management team to handle carton within the warehouse.
PN539
And then one goes to (c):
PN540
It is agreed that managers will not perform ongoing processing functions that could be considered to potentially jeopardise the jobs of DC employees.
PN541
And really that reflects the fact that this agreement was in relation and directed to the award classification employees that had traditionally been recognised.
PN542
THE SENIOR DEPUTY PRESIDENT: Clause 10, the grievance procedure, may require some consideration as well. That has as a second step in 10.2 reference to the Human Resources Manager. That was Mr Ford.
PN543
MR BOURKE: Yes, the grievance procedure doesn't seem to contemplate that people like the Human Resources Manager might have a grievance.
PN544
THE SENIOR DEPUTY PRESIDENT: Or that he would have a pretty easy means of resolving it.
PN545
MR BOURKE: Yes, that is right. And the reflection that the role of the union in our submission reflects the traditional coverage.
PN546
THE SENIOR DEPUTY PRESIDENT: Yes.
PN547
MR BOURKE: And that the idea that senior management be subjected to that and have the involvement of the union, etcetera, just doesn't fit. Now, we make the point that this application clause was also in the 2000 agreement at clause 3, which is at document 9 of that large folder, and the 1997 agreement. So for five years you have had management not treated in accordance with similar provisions, so the idea that 2002 there would be this sudden turn-around, we say would be absolutely extraordinary and that effectively what you would be having is the parties have been ignoring daily breaches for the last five years of each of those three agreements. So there would need to be a very express statement if now management is to be suddenly covered.
PN548
The point is made against us that prior to '97 there was a 1996 and a '94 agreement which had a clause which was set out in paragraph 23 of Mr Howell's first affidavit:
PN549
All employees, whether members of the union or not, engaged in any of the occupations, industries or calling specified in the award...
PN550
The point is made of a change of words. It is clearly a complete change of wording, and Mr Gray has dealt with that, that the NUW came up with a new form of agreement and that the agreement was not intended to change its application and that, in fact, he was not aware of - did not notice the change, and that is at paragraphs 17 and 18 of his affidavit.
PN551
Another point that is relied upon is his suggestion that there was an intention to change the 1997 agreement, and they rely upon a letter from the NUW which we have put also in our materials at the supplementary materials folder as an exhibit to Mr Gray's affidavit at tab C. The actual exhibit is TJG1 behind tab D, so it is D1. There is a reference there in terms of the coverage at paragraph 1(c) in terms of the - the agreement:
PN552
... will when finally - apply to all employees of Kmart Woodlands employed by the company...
PN553
Now, that has been argued to suggest well, that means everybody, and we say that is really an artificial reading of that letter because one must read it in terms - coming at their traditional coverage at that site, and one reads the opening line:
PN554
Further to our meeting of 29 May 1996 on behalf of its members.
PN555
And we have provided evidence that at this site NUW did not traditionally represent members - sorry - did not traditionally represent management. And there is then our response at TJG2 of 31 May 1996 about point 8 of the first page, you have got 1(b), (c) in the last sentence:
PN556
The company reserves the right to negotiate employment arrangements directly for all other employees.
PN557
As an abundance of caution we have made our position clear, and there is no suggestion that position was ever tackled as contrary to the NUWs position in any way. In fact, if you then look at the log of claims of the union at tab TJG5, which comes later after that exchange of 16 September 1997, and at paragraph 2:
PN558
That the company incorporate all existing conditions in the current enterprise agreement, the Storage Service Retail Warehouse Victorian Award and all other award conditions into one comprehensive agreement.
PN559
Now, it is clear that the previous enterprise agreement made it clear that it covered only the classifications in the award, so that is inconsistent that this new agreement was to cover management. Then when one goes to the response to that demand at TJG6 there is the reference to the comprehensive agreement in response to that, page 1, paragraph 1, and then in terms of what we are talking about, one goes to the last page of that document, there is a reference to the weekly wages, and we know that management are paid monthly by way of salary and the only people getting a pay rise are award classifications. So it clearly indicates it wasn't concerned with management monthly salary type employees.
PN560
And then one goes the NUWs document at TJG7 setting out the in-principle comprehensive agreement, and at paragraph 1 there is then again a reference to:
PN561
Protect all current conditions contained in the award and local agreements and previous enterprise agreements.
PN562
Nothing to do with management in any shape or form. And again, the second last page sets out the increases in pay, weekly wage, under various classifications. So if the original letter from the NUW is to be construed to mean everybody, including management, that proposal did not get off the ground. And further support for that is the two exhibits we tendered today, CML9, the notice of initiation of bargaining period - have you found that?
PN563
THE SENIOR DEPUTY PRESIDENT: No, I have that, thank you.
PN564
MR BOURKE: You have that?
PN565
THE SENIOR DEPUTY PRESIDENT: Yes, thank you.
PN566
MR BOURKE: If one goes to page 2 - this is 24 September 1996, again post the date of the letter - paragraph (c) talks about:
PN567
The initiating proposals to deal with the agreement are increases in wages and improved conditions of employment and maintenance of conditions of employed as prescribed by the Kmart Distribution Centre Agreement 1995 -
PN568
I think that should really read 1996 - and the previous Kmart agreements made it clear they only covered classifications.
[11.34am]
PN569
Mr Jesovis relates the 1996 agreement - I will just check that. But it is post the letter from the NUW of May 1996. Now there seems there is then a reliance on some different wording in the Hoppers Crossing 1997 Agreement and the MGB Agreement 2002, and the material discloses there were different people involved in the drafting. It doesn't really take the matter much further. And we say it is material, particularly in terms of any discretion, that Bassett and Ford, when they first made their demand on Logistics for extra money, and we have provided in Mr Howell's second affidavit, PLH2, which is exhibit CML2. If one goes to PLH2, the paragraph further - - -
PN570
THE SENIOR DEPUTY PRESIDENT: That is the one - so I am looking at - yes, CML2, yes, thank you.
PN571
MR BOURKE: But it is evident, from our client's instructions, that Coles Myer Logistics, over a number of years, adopted a practice of paying employees severance packages, calculated on a different basis to that provided to our client. We are instructed there are a number of examples of maintenance employees and other senior employees who, while not party to the Logistics and NUW EBA, have received severance payments calculated in accordance with its redundancy provisions. So they relied not on a custom and practice - not on being covered by the agreement, but a custom and practice that redundancy under the agreement had been applied.
PN572
And that approach is consistent with the way the vote was conducted, that they were not covered by the agreement. So their own - and now they are saying that our construction - that they are not covered by the agreement, which was their initial position, is unarguable. And that their construction, which results in invalidity, is the only construction open. So we say the jurisdictional requirements are met, that in the exercise of the discretion, the amendments should be made to reflect that it covers the classifications as traditionally recognised, and not intended to cover those persons viewed and treated as management employees.
PN573
And we move to the effective date of variation, and we say that should be the date of certification, because that will reflect the original intent that operate from day one. We are not effectively changing the bargain retrospectively. We are seeking an order so that the document accurately reflects, without ambiguity, what the true intention was at the time the bargain was struck. We say that makes it really an overwhelming case why any variation should be made from the date of certification.
PN574
Now, can I move to 170MD(6). Before I get to that, there is a procedure starting at MD(1) for the parties, if by agreement, to vary an agreement, and that has to be approved by the Commission, and there is the approval of the order. And in our submission, MD(5) - the variation takes effect when the Commission's order takes effect. So it makes clear that prima facie, if you hand the order down, it starts from that date. And that makes sense in terms of,where there is going to be a later agreed variation, you would need special circumstances to justify making the variation take effect earlier.
PN575
But when one goes to (6), we say that is really a discrete power, where you may make an order to vary the agreement, and your order making powers are at large to determine when that order is to take effect. There are views within the Commission that MD(5) also applies to MD(6). But even if that is the case, there is still clearly a power to make the order operate from the date in the order it is stated to take effect. So there is no difficulty there.
PN576
The Bassett/Ford submissions have contended there is no power to effectively back date the order on one - word, and that is - there is no authority in support of that, and the authority is clear. To the contrary, there has been ample decision where that has been done, which have been set out in the submissions. Can I just start in dealing with whether the whole - really the whole fundamental driver of MD(6) is to - really to ensure that controversies can be sorted out here, and the Federal Court is not stuck with trying to interpret an agreement which may not reflect the true intention of the parties.
PN577
Now that whole scheme of the Act is undermined if the variation is then not made to operate from the date of certification. Because you then have the Federal Court again exercising their task, where prospectively the Commission said, this is why it is operate - this is the true intention of the parties. And we are having really a hypothetical case in the Federal Court, only that it is for real, because the agreement - or the variation has not been set back to day one. And that point was recognised by Ryan J in his decision in Bassett, which was - - -
PN578
THE SENIOR DEPUTY PRESIDENT: CML3.
PN579
MR BOURKE: Correct. Have you got that, sir?
PN580
THE SENIOR DEPUTY PRESIDENT: I do, yes,thank you.
PN581
MR BOURKE: If one goes to paragraph 5, the point is made:
PN582
There have been various observations by members of this court about the desirability of parties to industrial agreements, availing themselves of a ...(reads)... of rights under an industrial agreement which is arguably uncertain or ambiguous.
PN583
No that is made in a context where Bassett and Ford have brought a claim, under the current wording, and the court has refused an injunction to stop us going here and seek clarification. And the only work MD(6) can do in order to assist the court's task, is if the variation is made from the date of the order. Otherwise nothing has changed. Because Bassett and Ford have left. There is no prospective involvement in relation to the impact of the certified agreement on them. And this point has also been made in Warramunda v Pride, which was put inside the sleeve of the folder of authorities, CML5. There were two cases put inside the sleeve.
PN584
THE SENIOR DEPUTY PRESIDENT: This is getting more abstract. Very well, I have those. They are indeed in there. Perhaps for ease of identification, if I can mark Warramunda, tab 19, within CML5, and AFMEPKIU v Qantas, tab 20.
PN585
MR BOURKE: Thank you. Now if one goes to paragraph 61 - - -
PN586
THE SENIOR DEPUTY PRESIDENT: Yes.
PN587
MR BOURKE: Finkelstein J spoke about this role of what is effectively rectification as power of a commission, and the notion of retrospective variation;
PN588
If the principle applies not only in statute law but to whatever law is recognised, as governing the rights of the parties, then an application for a ...(reads)... actual intention or was otherwise inappropriately procured.
PN589
And the point is made that this is - the Commission is the only place that has the power to make the variation so that the document adjudicated by the court reflects the actual intention of the parties. And that point is brought out in the AMWU v Qantas case by North J who, when asked to construe the meaning of a certified agreement, found he could not work out what the meaning was, but said, look, that is not a surprising outcome, because there is the power to go to the Commission and get documents clarified. And the Commission has an advantage over the court in that respect.
PN590
And that point is made at the last page of that decision at paragraph 68:
PN591
This proceeding is resolved by order that the application is dismissed. It may seem curious that the Court has not come to a definite view ...(reads)... While the Court can identify the ambiguity, it cannot remove it. The Commission is empowered to remove the ambiguity.
PN592
Now, unless the order is made to commence the date of certification, the ambiguity is not removed in relation to the Court's task which is currently before the Federal Court, and we would have an unfortunate situation where we would have essentially two regimes. One regime prior to the date of effect of the order where there is an ambiguity, and post the date of the order where there is no ambiguity, and there may be two effective sets of operation for the agreement.
PN593
We make the point, it is not the taking away of rights, the whole notion of rectification is to ensure that the document reads as it was intended to read on day one. And that point in terms of the notion of rectification is made in Meagher on Equity which is in our supplementary materials folder, CML8 at tab A4, Equity Doctrines and Remedies at page 886 which we have provided. At paragraph 26.010:
PN594
It is of the utmost importance in a proper appreciation of the basis of the equitable doctrine of rectification ...(reads)... may and do rectify instruments purporting to have been made in pursuance of the terms of the contract.
PN595
Just translating that, it is effectively they are - the written document is the attempt to record the agreement, and rectification, all it does is to ensure that the agreement is adjusted so it did reflect what the parties intended. The point is then made just above 26.015:
PN596
It follows from this that the effect of a degree of rectification is necessarily retrospective even if this involves an ex post facto validation of acts other invalid done under the instrument in its original form.
PN597
The notion of rectification is further dealt with in Issa v Berisha at A5, the next tab. At page 265(a) - paragraph (a):
PN598
The authorities make it clear that the effect of rectification, when granted, is to relate back to the time ...(reads)... as if it had originally been executed in its rectified form.
PN599
And then down the bottom of that page - there is some suggestion that the discretion should not be exercised in our favour because of some delay. I will deal with that, but the point is made here that if delay is going to be relied upon to stop rectification being ordered so that the document does not reflect the true intention of the parties, there must be shown to be some prejudice that flowed from the delay. There has been no evidence of prejudice here. Bassett indicates she didn't even think she was covered by the agreement in her material; Ford said nothing, and we have the original letter of demand from them where they indicated they relied upon a custom and practice type argument regarding redundancy.
PN600
That point is dealt with at 265(f) down the very bottom:
PN601
The defendant's case in this respect is essentially one that by reason ...(reads)... as would justify refusal of relief. It seems to me, however, there are several answers to this argument.
PN602
It then goes on about:
PN603
Any hardship in the broad, not the technical sense, to which the defendants will be subject will flow not from the fact of rectification, but from the fact of their being compelled to observe the obligation they intended to undertake; that is, the option were duly exercised to sell a unit to the plaintiff.
PN604
And we say that any hardship they may claim to suffer is only because the agreement will reflect the true intention, and that is not proper hardship or prejudice.
[11.56am]
PN605
But there is no basis to suggest that we have delayed. You have the evidence there was one demand that someone wanted a top-up, claiming that they were covered by the certified agreement, a discrete claim dealing with a top-up regarding redundancy, settled on a without prejudice, no admission of liability in 2002, and then this year we have had this claim formulated only for the first time on 1 May 2003, I think it was, saying we are covered by the agreement, as distinct from their original demand, and we have moved very quickly since then in applying to the Commission and been expeditious in prosecuting the matter.
PN606
Now, can I just briefly go back to the operation of MD(6) and (5). A view has been taken that if (5) and (6) work together, it then becomes an order under section 146 of which you need special circumstances or exceptional circumstances to make the order retrospective. We submit MD(6) has a discrete operation, it is not covered by 146. If I can just go to 146 if it does apply. There is requirement under 146 of exceptional circumstance a to retrospective date of an award, and it is our submission that that is really directed to that particular division 6 of awards of the Commission as distinct from - and its general award making power as distinct from making an order pursuant to 170MD(6) that we say has a discrete operation.
PN607
That view was adopted - was the approach of Senior Deputy President Kaufman in the CFMEU v Camberwell Coal at tab 10 of our folder of authorities which is CML5 at paragraph 22 on page 5 of the print.
PN608
THE SENIOR DEPUTY PRESIDENT: Yes.
PN609
MR BOURKE:
PN610
It follows for the purposes of clause 31.2.4 of the 2001 agreement, I determine positively in favour of the company ...(reads)... the variation should have effect from the date of certification of the 2001 agreement.
PN611
And that was the manner in which the matter was dealt with. There are contrary cases where the approach was that one had to come within 146, but in the cases we have examined the vast majority of those except in very exceptional circumstances have made the order retrospective where there was a finding of clear mutual intention. There is the case of Waterwheel at tab 11 where Vice President Ross at paragraph 26:
PN612
Subsection 170MD(5) provides for any variation pursuant to MD(6) to take effect when the Commission's order takes effect.
PN613
There is then a reference to section 146:
PN614
The operation of the agreement was terminated by order of the Commission on 1 August 2000. Hence, any prospective order arising out of these proceedings ...(reads)... No purpose would be served in providing any further degree of retrospectivity because no employees were retrenched.
PN615
So it was to ensure that it operated over the relevant period, and for us the relevant period, in order to avoid any of the numerous daily breaches we would otherwise incurred, would have to be the date of certification.
PN616
The next case is at tab 12, Golden Circle with Commissioner Hoffman. This issue was dealt with at paragraph 19 to 21, and going to paragraph 21:
PN617
Should it become necessary for the Commission to exercise its discretion, it is likely in all the ...(reads)... variation of the 1998 agreement coming into force from the date of certification.
PN618
And that was an issue regarding the meaning of afternoon shift. The next case is at tab 16, Simon Engineering, Deputy President Hamilton at paragraph 48 where he makes the point made earlier that not to grant retrospective variation as to the date of the agreement will create two regimes, one where there was certainty and one where there wasn't certainty. At 48:
PN619
In the circumstances, I propose these variations apply to the work that has occurred in the past and has now been completed. There is ...(reads)... it for the future when it may have no relevance.
PN620
That approach was consistent with Ruskin Plastics, tab 18, Commissioner Bacon, paragraph 20 and 21:
PN621
The order arising from this decision will have effect from the same date as the certified agreement ...(reads)... due to the uncertainty of the original wording of the agreement.
PN622
We say the same would apply to us. We should not suffer the disadvantage of the uncertainty for any period that is not covered by the order and to do otherwise would expose us to a claim by Bassett and Ford for additional redundancy pay, we say, based on an agreement that did not reflect the intention of the NUW and Logistics and would also result in a construction that may jeopardise the very validity of the certified agreement as management was not involved in the approval process. Those are the matters, if the Commission pleases.
PN623
THE SENIOR DEPUTY PRESIDENT: Very well. Thank you for that, Mr Bourke. Yes, Mr Farouque.
PN624
MR FAROUQUE: If I could just have a short adjournment to organise my papers, your Honour?
PN625
THE SENIOR DEPUTY PRESIDENT: Certainly. I will adjourn until 12.15.
SHORT ADJOURNMENT [12.07pm]
RESUMED [12.18pm]
PN626
MR BOURKE: Sorry, sir, there is just one thing to clarify.
PN627
THE SENIOR DEPUTY PRESIDENT: Yes, Mr Bourke.
PN628
MR BOURKE: Exhibit CML9 and CML10, I just wanted to make clear they are directed to the 1996 agreement and that was what the 29 May 1996 letter from the NUW that referred to cover employees related to, the 1996 agreement.
PN629
THE SENIOR DEPUTY PRESIDENT: 1996 agreement, yes.
PN630
MR BOURKE: But our point is that if the NUW wanted it to cover all employees, they would have agitated it in the notice of initiation of bargaining period. They clearly haven't and it is an artificial reading of the letters to suggest they actually even had put that on the table as an issue.
PN631
THE SENIOR DEPUTY PRESIDENT: Yes, very well. Thank you.
PN632
MR BOURKE: If the Commission pleases.
PN633
THE SENIOR DEPUTY PRESIDENT: Mr Farouque.
PN634
MR FAROUQUE: If the Commission pleases, your Honour, I may go firstly to the matter of the 1996 letters, so to speak.
PN635
THE SENIOR DEPUTY PRESIDENT: Yes, certainly.
PN636
MR FAROUQUE: Those letters or the relevant extracts to those letters are contained in paragraph 15 and paragraph 17 of the written submissions relied on by the interveners. My learned friend says that the nature of the claim on the part of the NUW as stated in the letter of 30 May 1996 should not be construed as a reference to the category of employees to whom Ms Bassett and Mr Ford apply. Your Honour, in my submission - and further, as I understand his submission, he seems to suggest that the reference in the NUW letter of 30 May 1996 was, in effect, a reference to employees as contained in the store workers award.
PN637
Now, in my submission, the best measure of the nature of the claim as put by the NUW is the understanding that Coles Myer itself had at the time that claim was made, because if we look at the manner in which Kmart or Coles Myer - I will refer to it in the generic sense - replied to that particular claim by letter dated 31 May 1996 was to say that the agreement - and this is extracted at paragraph 17 of the written submissions -
PN638
...will, when finalised, apply throughout its period of operation to the occupations and callings at Woodlands that are currently administered as award covered. The company reserves the right to negotiate employment arrangements directly with all other employees.
PN639
So, in my submission, the best measure of what the NUW was claiming in the context of that document, the letter of 30 May 1996, is the perception itself that the company had as to the nature of the claim. Clearly, the company understood the claim to be one where, if it did accede to that particular claim on the part of the NUW, the scope of application of the award, its extent of coverage, would apply beyond the classifications contained in the award, and they clearly rejected that course in the context of the 1996 negotiations.
PN640
Now, of course, the NUW was on notice, came to this hearing on the first hearing day, opposed any intervention by Ms Bassett and Mr Ford, and has received submissions, these submissions, on the part of Ms bassett and Ford, which make specific allegations about the nature of the claim made in 1996, what was being sought in the context of the industrial negotiations between the parties, and have nothing to add to that topic clearly. They have nothing to say about that particular matter.
PN641
THE SENIOR DEPUTY PRESIDENT: But on what basis, is the question that arises. On what basis did they choose not to involve themselves further in these proceedings?
PN642
MR FAROUQUE: The basis of - they have said that they have decided not to commit the union's resources to any ongoing involvement in the case.
PN643
THE SENIOR DEPUTY PRESIDENT: Yes.
PN644
MR FAROUQUE: But they have nothing to say on the specific allegation as made out in these submissions. That is the point that I make. In essence, they have said nothing about it, and - - -
PN645
THE SENIOR DEPUTY PRESIDENT: Well, they have said nothing about anything in - - -
PN646
MR FAROUQUE: They have said nothing about anything, indeed. But we rely on the fact, your Honour, that came out of Coles Myer at the time, clearly had an understanding as to the nature of what was being claimed by the NUW, and we say that that is a critical matter when one considers the surrounding circumstances as to the nature of the claim as it was being put forward by the NUW.
PN647
Now, further to that, we have the fact of the Hoppers Crossing Agreement, the relevant passage of which is extracted at paragraph 20 of the interveners' submissions, and that agreement - the negotiation and certification of that particular agreement, the Hoppers Crossing Agreement 1997, an agreement concluded as between, in effect, the same parties, was - the application clause of that particular agreement clearly states that it applies to all employees, but then it goes further. At paragraph 3.2, which is extracted at page 7 of the interveners' submissions, it states very clearly:
PN648
Categories of employees who are to be exempted from the ordinary application of a clause - of general application as provided in paragraph 3.1.
PN649
So in my submission it is, we say, clear that when you compare the two instruments and the understandings that the parties had in respect of those - the effective clause in the nature of that contained in the 1997 agreement, clause 3, and that in clause 3.1 of the Hoppers Crossing Agreement, that the clause would have brought application to employees in the nature of management employees or other categories of employees who may be beyond the scope of the classification structure contained in the award.
PN650
So we say, your Honour, that the nature and the context in which these other instruments were negotiated is a material factor that the Commission should take into account in assessing the intent of the parties in the claim made in 1996, which we say was ultimately included in the 1997 agreement.
[12.26pm]
PN651
Now, we had the evidence of the fact that - we had the evidence of Mr Gray. Mr Gray's evidence on how the 1997 agreement came to incorporate the clause which has subsequently been replicated is that the NUW drafted the - had carriage of the drafting of the agreement. He conceded in his evidence that claims changed during the course of negotiations. He conceded that claims can be made in the context of drafts forwarded as between parties. So, your Honour, we have a situation where it is clear from Mr Gray's evidence that the provision, the particular provision, came about as a result of something put by the NUW.
PN652
That which was put by the NUW in the context of the 1997 agreement is substantially the same as the claim as was put forward in the May 1996 letters. So we have a substantial similarity. In fact, they are entirely consistent with each other as to the scope of what the NUW sought in the 1997 agreement when it produced, evidently, a draft which it forwarded to Coles, which was entirely consistent with what they had sought in 1996, albeit unsuccessfully in the context of those particular negotiations, having regard to the ultimate form of the 1996 agreement's scope and application clause.
PN653
So we say, your Honour, that here we have it, the NUW in 1996 pursuing a particular course. We say it is clear from the terms of the 1997 agreement and the fact that they produced a draft, they forwarded the draft and from the ultimate terms of that scope and application clause, which evidently from Mr Gray's evidence reflects the draft as produced by the NUW, that they were pursuing the same thing and what they were pursuing is consistent with the view that Coles Myer took of it in 1996, which was we reserve the right to negotiate in respect of other categories of employees. They clearly understood what the NUW was seeking in 1996.
PN654
So we say, your Honour, that is a significant matter which should weigh in the Commission's consideration of the course of those particular claims. Now, we say, in essence, that the agreement is essentially clear on its face that the application clause is broad but it is clear, your Honour, and in that regard we have referred to the decision of the Full Court of the Federal Court in a decision of Spalding v Can't Tear 'Em Pty Limited, which is reported at ('99) IR page 1. The relevant extract of it, your Honour, is contained in the applicant's supplementary materials under tab 1.
PN655
In that matter the Court was confronted with the task of construing a particular certified agreement. That certified agreement evidently applied insofar as the Clothing Industry Award applied and the Court was there confronted with the task of construing the application of the certified agreement by virtue of the application of the relevant award. The application clause of the award was very far reaching, broad in its scope and at paragraph 5 of his Honour Wilcox Js reasons, he recounts the term of the relevant application clause of the award that it is extremely broad, it applies to each and every person employed by them in the clothing industry. It goes on:
PN656
Provided the employee is employed in the clothing industry, he or she is, prima facie, covered by the ...(reads)... what award entitlements the particular employee might have engaged.
PN657
So, your Honour, we rely on that passage. We say that it is substantially similar in the nature of the task confronted by this Commission and that course. You had a broad application clause. We had a manager there who was alleging entitlements to the benefits of redundancy payments under the terms of the certified agreement. The task in terms of the construction of the particular clause was a broad application, not expressed to be subject to any exceptions or exclusions and, as his Honour Wilcox J observed, without the clear exceptions or exclusions, the employees covered by the award. Now, his Honour went on at paragraph 6 to say that:
PN658
The respondent argues that the appellant was excluded from the operation of the award. ...(reads)... which aptly describes the position of the appellant at the date of the termination.
PN659
Then he goes on at paragraph 7:
PN660
As will be apparent, I have concerns about this whole approach.
PN661
So he is throwing doubt on the qualification of the scope and application clause by virtue of the pay scales. He throws doubt on the proposition in paragraph 5 that difficulty of determining what particular entitlements an employee might have under the award would have the effect of causing the Court to read down the broad application provision in the award. So, your Honour, we rely on that particular decision to say, similar to the Spalding v Can't Tear 'Em case, that agreement, clause 3 of the 2002 agreement and its predecessors, the 2000 and 1997 agreement are clear on its face.
PN662
They apply without exception or exclusion. In the absence of such exception or exclusion, they have broad application and the Commission should not regard that particular clause as being ambiguous or uncertain in its effect or regard the agreement as a whole as being ambiguous or uncertain in terms of its application.
PN663
THE SENIOR DEPUTY PRESIDENT: Mr Farouque, did Wilcox J cast doubt on reference to the classification level, because he seems to have explicitly found that the employee in this case would have fallen within skills level 5 in the relevant classification at the time of the termination of her employment?
PN664
MR FAROUQUE: Your Honour, he did go on to observe in paragraph 7:
PN665
However, even accepting that particular approach, I do not think that it is clear that the pay rates failed to cover the appellant.
PN666
He makes that observation there but he deals substantially in paragraphs 5 and the first part of paragraph 7 with the initial proposition, similar to that which is put by the applicant today, that the application clause, which was broad, should be read down. In my submission, he rejected that. He expressly found that in the circumstance where there was no express exclusion, then in the absence of such exclusion, the scope and application clause of the award should be given its full force and effect.
PN667
So, your Honour, we rely on that decision of the Court and we say, in essence, that following that, that the fact that Logistics may be troubled or inconvenienced by the clarity or breadth of application of the 2002 agreement does not give rise to any ambiguity or uncertainty. Now, my learned friend made much of the issue of the application of other provisions of the agreement to employees in the circumstance of Ms Bassett and Mr Ford and we refer to the passage in his Honour's decision that:
PN668
It is not enough that it may be difficult to determine what award entitlements the particular employee may have engaged -
PN669
to rebut that particular proposition. Your Honour, we say that even if one goes beyond the face of the award and has a look at the surrounding circumstances, then, in essence, the critical time or the critical transaction is the circumstances surrounding the making of the 1997 agreement and what preceded that, that is, the nature of the claims made by the NUW in the May 1996 letter. We say that those are the critical events because those are the circumstances in which the terminology in the 1997 agreement arose and consistent, your Honour, with the decision of the Full Court of the Federal Court in Short v Hercus.
PN670
I have extracted the relevant passages at paragraph 10 of the intervener's submissions, which is that - the passage is the to the effect that:
PN671
The context of the expression may thus be much more than the words that are its immediate neighbours. Context may extend to the entire document, which it is part ...(reads)... understanding its original meaning and then seeing how it is now used.
PN672
Then his Honour goes on and makes a similar observation at page 135 of the reported decision and I have extracted that at paragraph 10 of the submission. I have, your Honour, copies of Short v Hercus, which for the convenience of the Commission, I will hand up. I don't propose to take the Court to any of the other passages, other than that which I have extracted in the submission but we say that, in essence, the critical time that the Commission should examine - or the Commission should consider in terms of construing the parties bound on application clause, is what happened at 1997 and before that; what was the course of the relationship between the parties; what were they seeking during that particular period.
PN673
In my submission, having regard to the matters that I outlined at the commencement of my submission and our account in the written submission, it is clear that the NUW was seeking a broad application of the agreement that they were negotiating with Kmart and consistent with that, they were ultimately successful in achieving that outcome in the 1997 agreement as it was concluded, and that clause, of course, replicated in the 2000 and 2002 agreements.
PN674
THE SENIOR DEPUTY PRESIDENT: What of the bargaining period notice which intervened? What did that suggest about the intent of the union.
PN675
MR FAROUQUE: Your Honour, which particular bargaining period?
PN676
THE SENIOR DEPUTY PRESIDENT: The one in relation to the 2002 agreement.
PN677
MR FAROUQUE: Was it CML9 and - - -
PN678
THE SENIOR DEPUTY PRESIDENT: CML9, is it? No, that was in 1996. Tab 3, is it, in the CML1? No, that is the documents going to certification.
PN679
MR FAROUQUE: Your Honour, I think it is - is it tab 3 of CML1, I have, the notice of initiation of bargaining period.
PN680
THE SENIOR DEPUTY PRESIDENT: It is, yes, yes.
PN681
MR FAROUQUE: Your Honour, we, essentially, submit in that regard that the relevant matter is in essence the course adopted by the parties in 1996 and 1997, that that application clause being replicated through the course of the industrial instruments from 1997, 2000 and 2002, the critical transaction as between the parties is what occurred in 1997 and what occurred prior to that, because that gives, your Honour, we say, the relevant context which gave rise to the making of the particular provision.
PN682
So we, in my submission, your Honour, no significant weight should be accorded to the document under tab 3 because the critical time was that which occurred in 1996 and 1997. Clearly, the NUW in the context in which the clause was replicated through the course of those three agreements was not seeking to change the extent of application of the agreement. That is evident, your Honour, and can be inferred from the fact that the clause did not change. So the circumstances, the relevant intention in terms of coverage or application of the agreement is that which can be inferred from the dealings between the parties in 1996 and 1997. So that, your Honour, is the submission that I make in relation to that issue.
PN683
THE SENIOR DEPUTY PRESIDENT: Is that an appropriate time for luncheon adjournment?
PN684
MR FAROUQUE: Your Honour, if that would be convenient to the Commission.
PN685
THE SENIOR DEPUTY PRESIDENT: Very well, I will resume at 2.00 pm.
LUNCHEON ADJOURNMENT [12.45pm]
RESUMED [2.00pm]
PN686
THE SENIOR DEPUTY PRESIDENT: Yes, Mr Farouque.
PN687
MR FAROUQUE: Your Honour, I think before we broke for lunch, I think I was at the point where I was making some submissions as to the application of the Hoppers Crossing agreement, the effect of those particular terms in the context - that agreement having been negotiated shortly prior to the 1997 Woodlands agreement. Now, we rely on that context to support the submission we made as to the fact that the 1997 agreement is clear on its face and we say even if one has regard to that extrinsic material there is no ambiguity in that context.
PN688
We also rely, your Honour, on that context and that as which also attended the MGB Distribution Centre agreement which is referred to in paragraph 23 of the intervener's submissions for the alternative proposition that in the event that the Commission determines that there is an ambiguity or uncertainty and in the event that the Commission is satisfied that it has jurisdiction we put those matters in support of the proposition that the Commission should not exercise its discretion which is then vested in the Commission to vary the agreement because the Commission is not, in essence, in a good position to determine what was in fact the common intention of the parties.
PN689
Because, your Honour, as I have referred to we have the course of what occurred in '96 in terms of the exchange of letters in May 1996. We have the fact, as I referred to earlier, that the NUW draft of the 1997 agreement. We have the concession on the part of Mr Gray who gave evidence for the applicant that claims are made in draft documents exchanged between the parties and in those circumstances, your Honour, we would say that it is evident that the intention of the NUW, and it can be inferred from the course of events that I have referred to, that the intention of the NUW was to cover all employees at the Woodlands Distribution Centre in terms of the application of this particular agreement.
PN690
So, your Honour, we would say in that circumstance and having regard to that submission the Commission is not well placed to infer what the meaning of clause 3 as it occurred in the '97, 2000 and 2002 agreements was in fact. So we would make that submission, your Honour, in relation to that matter. And in that regard, your Honour, I rely on a decision, a recent decision of Senior Deputy President Marsh. I have a copy of this decision which I referred to in my submissions. If I could hand up a copy of that decision to your Honour.
PN691
THE SENIOR DEPUTY PRESIDENT: Yes.
PN692
MR FAROUQUE: That matter, your Honour, also involved a dispute as to the extent of an application of an agreement. It involved a circumstance where the company were seeking a variation of the certified agreement. It is submitted and this is recorded in paragraph 27 of the decision that staff employees who signed the salary package arrangements were covered by the agreement. The CFMEU, who are not party to that particular agreement, submitted that the agreement only covered admin roles covered by the ACSA Award and that particular award is said to be confined to members of the SESA.
PN693
So there was a difference between the parties, between the CFMEU and the company Beltana as to the application of the certified agreement. Her Honour eventually found in that particular matter that there was an ambiguity in the agreement. And that finding is recorded at paragraph 77 of the decision. Her Honour ultimately made that particular - held that that circumstance existed. Nevertheless, in the eventual result her Honour dismissed the application to vary the agreement and the relevant reason provided for was at paragraph 111 of her reasons which was to the effect that:
PN694
...the evidence did not disclose the mutual intention of the parties which would allow me to exercise my discretion. It clearly discloses the intention of Beltana but this is not the test which I am required to apply.
PN695
And her Honour went on:
PN696
In this regard I have not been assisted by the failure of APESMA -
PN697
which was the successor union party to the actual agreement -
PN698
...to give any direct evidence particularly when the hearsay evidence given by the CFMEU before me is contradicted by the evidence of Beltana.
PN699
So in this particular matter, your Honour, you had a circumstance where the relevant union party to the agreement - the CFMEU not being a party to the agreement - did not give evidence as to the intention it had in respect of the agreement. There was a conflict on the evidence and her Honour made the finding that whilst the evidence disclosed the intention of the employer party, Beltana, the evidence was not sufficient to disclose the intention of the other party to the agreement, the other organisational party to the agreement being APESMA. So - - -
PN700
THE SENIOR DEPUTY PRESIDENT: That is in a circumstance where the intention of Beltana and the CFMEU was clearly at odds or - I am sorry - where - - -
PN701
MR FAROUQUE: The CFMEU was not a party to the relevant certified agreement which was the subject of dispute. The background of the matter being that the CFMEU had served notices of initiation of bargaining period and was proposing to take protected industrial action in relation to a certain - or proposing to organise protected industrial action in relation to certain categories of employees which Beltana asserted were covered by the relevant certified agreement. And so in the end result, whereas the Commission in that particular decision found that there was an ambiguity, it declined or dismissed the application, declined to vary the agreement because it wasn't satisfied as to the mutual intention of APESMA, which is the successor organisation bound by the particular agreement. And in that circumstance it couldn't divine what the common intention of the parties was.
PN702
It clearly - it referred to the fact in paragraph 111 that the evidence disclosed the intention of Beltana but that was not the test. The test was what was the common intention? In my submission, having regard to the history of the instruments that I have recounted, having regard to what occurred in 1996, having regard to the carriage of the NUW in respect of drafting the 1997 agreement and having regard to the fact that the clause in the 1997 agreement reflected what in fact the NUW had sought in 1996 there is, in my submission, a relevant conflict on the evidence.
PN703
There exists in circumstances where the NUW has not come before this Commission and given evidence as to what its intention, or officers on its part, given evidence as to what its intention was in making the 1997 agreement in the terms that it did - - -
PN704
THE SENIOR DEPUTY PRESIDENT: Why the 1997 agreement? The application is to vary the 2002 agreement?
PN705
MR FAROUQUE: Your Honour, we say, as I referred to earlier, as I submitted earlier, that the critical transaction is what occurred in 1997 and preceding that because the clause did not change thereafter. We had the evidence of Mr Howell which was to the effect under cross-examination that - at least on the part of Coles - it was not seeking to change the extent of coverage from the 1997 and 2000 agreements. Those clauses were replicated over a period of time and consistent with the passages in Short v Hercus which I referred you to, but the replication of that clause has brought with it the ..... from which it initially occurred, to paraphrase something which was said by Burchett J in Short v Hercus.
PN706
That is the relevant factual transaction or critical time when the intention must materially be divined. It has been replicated, it is clear that the parties, in my submission, from that fact did not seek any change from what was effected in that particular 1997 instrument. So that, your Honour, is why we assert the primacy of the significance, the importance of that circumstance. That is where the Commission should devote its energy to divining what the intention of the parties was in respect of the instruments because the clauses are the same.
PN707
So, your Honour, we would say that the Commission may include, based on the evidence before it, that Coles Myer had - if it came to this point, your Honour, that the Commission could conclude that the evidence establishes that what the intention of Coles Myer was but it is not properly in a position to divine the intention of the NUW given the history that I have recounted. And in that particular circumstance the Commission should, in circumstances where consistent with Beltana, it is not in a position to divine what the mutual or common intention of the parties was, which is the test, so to speak, in effecting a variation that it should decline to vary the agreement in the manner sought by the applicant. And that would be consistent with the course adopted in the Beltana matter where, as in this matter, the union party has not given evidence before the Commission.
PN708
Now, your Honour, I turn to the submission made by my learned friend in relation to the retrospective variation of the certified agreement.
PN709
THE SENIOR DEPUTY PRESIDENT: Were you going to address the Jones v Dunkel point relied on by Mr Bourke?
PN710
MR FAROUQUE: Your Honour, I will address that point and I will address it in this way. The case that we put, your Honour, is that the critical events were as they occurred in 1997. Now, Mr Ford was not present in the circumstances of the conclusion of the 1997 instrument so in that circumstance, your Honour, we say that anything he would have said wouldn't have been on assistance to the Commission in divining what the intention of the parties was. That intention being referrable to the events which occurred in '96 and '97. So, your Honour, we say that - - -
PN711
THE SENIOR DEPUTY PRESIDENT: So are you saying in effect that no regard should be had to what occurred in 2002?
PN712
MR FAROUQUE: I am not saying that no regard should be had to that, your Honour, but I am saying that the critical transaction was what occurred in 1997. The clause is replicated. The clause is identical in its replication.
PN713
THE SENIOR DEPUTY PRESIDENT: Yes, I understand that. Are you saying Mr Ford could shed no light at all on the issue?
PN714
MR FAROUQUE: Your Honour, I simply say, your Honour, that given that the the nature of the events as I have recounted, this evidence wouldn't materially assist the Commission in the task that it must perform given the history of these instruments.
[2.16pm]
PN715
Your Honour, before I turn to the retrospectivity point, I want to refer to a submission made by our learned friend. He placed some emphasis on some observations of Deputy President Leary at the certification of the 2002 agreement. In relation to that particular matter, your Honour, we say this, that the matters in respect of - the observations made by her Honour in the context of the certification are substantially identical to observations that her Honour made in relation to a number of other instruments which she certified on the particular day, and I have recounted - those are contained at tab - the extracts of the certification hearings in relation to those other instruments are contained in tab 16 to tab 19 of the interveners' documents.
PN716
I will take your Honour to just one of those documents. If I take your Honour to tab 16.
PN717
THE SENIOR DEPUTY PRESIDENT: Yes.
PN718
MR FAROUQUE: There her Honour makes a substantially similar observation to what she said in respect of the Woodlands 2002 Agreement which was to the effect that:
PN719
Parties to the agreement are Barlab Australia Proprietary Limited and those employees covered by the classifications found in the agreement.
PN720
It appears that her Honour was, from the course of the particular transcripts that are contained in that material, referring in a collective fashion to the parties bound, and in my submission, no great weight should be accorded to that, because if we go to the transcript, your Honour, of what was said in relation to the 2002 agreement, if I take your Honour to tab 6 of CML1 where the only observation made by Mr Lyons, the union party to the agreement, is:
PN721
If the Commission pleases -
PN722
and this is at paragraph number 4 -
PN723
the union and the employer are seeking certification of the agreement in the terms filed.
PN724
And he goes on to refer to the statutory declaration. So in terms of the application of the agreement, we say he simply says that the union and employer are seeking certification of the agreement in the terms filed. That doesn't, in my submission, advance the matter in terms of divining what the intention of the NUW was.
PN725
I know my learned friend says that none of the parties disputed what her Honour said at the conclusion of that certification hearing, but as you can see from the transcript at paragraph number 22 to paragraph number 24, her Honour made the statement relied upon by my learned friend and then certified the agreement, thank you, and the hearing was there adjourned. So, you know, it appears that there probably wasn't much of an opportunity to say anything if at all. So, your Honour, we say that no significant weight should be accorded to those matters in divining what the intention of the parties was.
PN726
In relation to the invalidity argument that my learned friend raised, he referred to the decision of a Full Bench in the Australian Workers Union v Energy Developments which was contained in the respondent's folio of authorities. If I could just refer your Honour to that decision.
PN727
THE SENIOR DEPUTY PRESIDENT: Tab - sorry tab?
PN728
MR FAROUQUE: It is tab 2, your Honour, in the supplementary folder.
PN729
MR BOURKE: A2.
PN730
MR FAROUQUE: Your Honour, in that particular matter, as my learned friend recounted, a number of employees who the union argued would have been - the agreement would have applied to them by virtue of the terms of the agreement, had not been afforded an opportunity to vote in that particular - events leading up to the certification of that agreement.
PN731
Now, the Commission dealt with a submission which was to the effect that basically being subject to the agreement would depend on the person being afforded an opportunity to vote on the agreement process, on the making of the agreement, so those who hadn't been asked to vote would not be subject to the agreement. Now - - -
PN732
THE SENIOR DEPUTY PRESIDENT: I thought the argument was put more in the sense that absent the involvement in the making, and obtaining the valid majority, that the agreement would be invalid and one should construe a document to give it validity.
PN733
MR FAROUQUE: Yes, I understand the submission my learned friend makes. I was referring, your Honour, to the submission that was put to the Full Bench in the AWU matter.
PN734
THE SENIOR DEPUTY PRESIDENT: I see.
PN735
MR FAROUQUE: In that particular case, the submission was put that those who hadn't been offered an opportunity to vote would not, in essence, be subject to the agreement and hence it didn't offend section 170LE and the like. Now, the Commission made some observations in that context about how the application of an agreement was to properly operate, and I want to refer, your Honour, to paragraph 14 of the decision, and I will read that paragraph to you:
PN736
The determination of whether a person's employment will be subject to the agreement depends on the proper construction of the scope of the agreement and not upon contractual notions of offer and acceptance.
PN737
The Commission then goes on at paragraph 16, after referring to the argument that I referred to of application being contingent on offer:
PN738
The flaws in this argument are obvious.
PN739
And then at the conclusion of paragraph 16:
PN740
The application of the agreement to a particular employee is not dependent on whether that employee voted in favour of the agreement or was offered the opportunity to vote.
PN741
So, in effect, your Honour, what the Commission is saying there is that when tasked with the - when asked to determine the application of the agreement - when asked to determine how an agreement is - its scope of application, its extent of application, that task is not to be determined by reference to who was offered an opportunity to vote or who was not. The task is to be determined by considering the scope and application of the agreement in its essence and that in this particular instrument is by reference to clause 3.
PN742
So we say in a sense that having regard to the observations of the Full Bench that I have referred to, that the scope of its application of this particular instrument cannot be determined, cannot be contingent upon those who are offered an opportunity to vote or not. It is to be determined on the face of the document.
PN743
THE SENIOR DEPUTY PRESIDENT: Yes. I didn't understand Mr Bourke to advance a submission of that kind, but rather it was the question of leaning towards giving a document validity rather than the reverse in the case where there was doubt.
PN744
MR FAROUQUE: Your Honour, we would say, your Honour, that that is - if the applicant contends that the agreement is invalid by virtue of the certification process, then there are - and this is the not the circumstance, this application is not the way that matter should be determined. Those considerations should not intrude upon how the agreement is construed. The parties bound - - -
PN745
THE SENIOR DEPUTY PRESIDENT: But it was being relied upon in aid of the construction; ie, to apply the principle that one should lean in favour of construing a document to give it meaning or validity rather than the reverse. So it was being relied upon by Mr Bourke as an aid to the construction of the document.
PN746
MR FAROUQUE: Yes, your Honour, I understand that is how my learned friend put it, but - - -
PN747
THE SENIOR DEPUTY PRESIDENT: Well, that does arise in the context of this case, does it not?
PN748
MR FAROUQUE: It is an issue which my learned friend has raised, but we say that the terms of clause 3 are clear, that it has brought application, and one need go no further than that, your Honour.
PN749
THE SENIOR DEPUTY PRESIDENT: Yes.
PN750
MR FAROUQUE: Now, your Honour, if I can turn to the matter of what my learned friend said in relation to the retrospectivity issue, in terms of the parallel that he sought to draw as between the power of rectification vested in courts in relation to instruments such as contracts, and the power under section 170MD(6), we say that in essence there is no - that they are very different powers to this extent, your Honour. The power of rectification arises in circumstances where parties by way of mutual error or mutual mistake wrongly give effect to their intention in a document.
PN751
Now, we say, your Honour, it is not contingent on there being some finding by the court of some pre-existing ambiguity or uncertainty in terms of the terms of that particular document. The document in circumstances of rectification may be crystal clear. For instance, one could imagine a circumstance where a developer is selling lots of property. Parties had, in fact, agreed to sell lot - to transact a purchase in relation to lot 6, but by some error, lot 7 was referred to in the documentation. Now, despite the fact that the document may on its face be crystal clear, the court has the power to rectify that particular circumstance if that particular error, that particular mutual mistake, if what the parties had agreed was the sale and purchase of lot 6. It is not necessary for the court to find some pre-existing ambiguity or uncertainty.
PN752
THE SENIOR DEPUTY PRESIDENT: But it might arise in that circumstance?
PN753
MR FAROUQUE: It may arise in the circumstance of rectification, it may well arise in that particular circumstance, but what has been conferred on the Commission is a power to vary in circumstances - or a discretion to vary in circumstance where there is a pre-existing ambiguity on certainly where it has made a finding in respect of that issue. A court exercising equitable jurisdiction in exercising or where - where it is - the exercise of the remedy of rectification is sought, is not required to determine some pre-existing ambiguity or uncertainty. That is not the task that it is being asked to perform, whereas the Commission is being asked to perform something different.
PN754
THE SENIOR DEPUTY PRESIDENT: Does the court apply a different approach in matters of rectification as between circumstances where there is simply mutual error or circumstances where there is an ambiguity or uncertainty in the contract?
PN755
MR FAROUQUE: Your Honour, I didn't - - -
PN756
THE SENIOR DEPUTY PRESIDENT: In apply the process of rectification, does the court deal with matters any differently on the basis of what is being rectified being on one hand an error mutually entered into or an issue of ambiguity or uncertainty?
PN757
MR FAROUQUE: Well, your Honour, in essence, the court in circumstances of rectification - as a matter of factual circumstance it may be that a common mistake or a common error gives rise to an ambiguity or uncertainty, but that is not the issue which the court need consider. The issue that the court must consider is whether the parties by virtue of mutual mistake have wrongly expressed their intention. Now, that might be manifested in ambiguity or uncertainty, it may be manifested in crystal clarity, but it doesn't reflect what the true agreement was.
PN758
The court is not required to consider whether there is some pre-existing ambiguity or uncertainty. That is not the test which the court is tasked with. So we say that there is a material distinction in that respect between the power of rectification and the power of the Commission under section 170MD(6).
PN759
We also say this, your Honour. My learned friend, as I understood his submission, was not putting the power under section 170MD(6) in such a sense as to say that where there is an ambiguity or uncertainty and where the court decides to vary the agreement, that variation has to be as a matter of course rectification as of the date when the instrument is made. As I apprehend what my learned friend - to be saying, that the Commission has a discretion in terms of the time or the date as to when the variation is given effect.
PN760
Now, as my learned friend said when he correctly observed that rectification when exercised by the court occurs from the date that the document or the - the document was made. That happens as a matter of course. That is when the document is rectified.
PN761
It is not that the court is vested with a discretion as to rectify the document at some later date. It occurs from the inception of the document. So that rule in the circumstance of rectification is not one which in a sense applies to this Commission, as my learned friend put it, in terms of section 170MD(6). So in a sense, it is my submission that it is not useful; doesn't assist the Commission to conceive of the powers in section 170MD(6) as powers in the nature of rectification. They are different. The Act in itself does not use the terminology of rectify, it uses the terminology of vary. In my submission it doesn't assist the Commission to conceive of the power in the manner that my learned friend framed it as akin to rectification.
PN762
So in my submission, your Honour, it wouldn't be of assistance to the Commission to conceive of the power in the sense that my learned friend urges upon you. So, your Honour, we would submit that the power to vary the agreement should be regarded as one which is of prospective effect.
PN763
Now, your Honour, it would be useful in that regard to consider the terms of section 146 of the Act. Now, my learned friend referred, your Honour, to that provision in the context of submitting that section 146 did not apply to section 170MD(6). And I am not urging that position on the Commission. I don't make that submission. But section 146, in my submission, is relevant to this extent, your Honour. There we have in section 146 a clear indication of legislative intent that an award may in effect be retrospectively varied. It can have that particular effect pursuant to that particular provision, section 146.
PN764
Now, in my submission, in the context of that clear effect of the legislation in respect of the variation of awards, we have the insertion of section 170MD of the Act in respect of circumstances in relation to the variation of certified agreements. In the context of that legislation, section 170MD(6) does not say anything as to when a variation can be effective, and we would say that where an Act provides for quite a clear course in respect of retrospective variation of awards, the Act is - a provision is inserted into the Act in relation to the variation of certified agreements and that provision is silent as to when a variation would be said to take effect.
PN765
Section 170MD(6) of the Act should not be construed as conferring a power on the Commission to vary with retrospective effect because if the parliament by virtue of the amending Act had decided that was the power to be conferred on the Commission, a provision to the effect of section 146 and a scheme set out there would have been inserted in the Act. So we say that having regard to that legislative context, your Honour, that the Commission should not construe the power of section 170MD(6) as giving rise to a power to retrospectively vary.
PN766
Now, in that context, your Honour, I have referred to an ordinary principle that as a general presumption against construing a provision as conferring a power to act retrospectively in the absence of clear words conferring such power. It is my submission that section 170MD(6) does not contain clear words conferring a power to act retrospectively, and in that circumstance the Commission should not construe the power as so conferring that power upon it.
PN767
Now, I also further submitted at paragraph 38 that if section 170MD(5) did apply to the power under section 170MD(6), that also, in effect, does not contain clear words authorising respective variation, and in that circumstance that would not authorise the retrospective course that the applicants urge upon the Commission.
PN768
Now, in any event, your Honour, we would submit that even if the Commission determines that it has the power to retrospectively vary the agreement, it should not do so, and the reasons are that Ms Bassett and Mr Ford, they have certain entitlements to severance payments under the agreement and that course would prejudice the rights they have in respect of that claim.
PN769
Now, I have also referred to a decision of his Honour Vice President Ross in Victorian Trades Hall Council Application for Minimum Wages Order where his Honour makes some observations in relation to the power to retrospectively vary an instrument. I hand up a copy of that decision to your Honour. His Honour there was considering an application to give certain orders in relation to the making of minimum wages orders in relation to the Victorian sector employees to give those orders retrospective effect.
PN770
There were some submissions made in that particular matter as to the Commission's power to retrospectively vary and the presumptions which applied in that circumstance. His Honour held at page 11 of the decision that I have handed up to the Commission that he agreed with the submission that:
PN771
...section 146 did not apply to matters before me, but despite this there is a general presumption against retrospectivity.
PN772
So even if the Commission was to construe the power in section 170MD(6) as conferring the power to act retrospectively, we would submit that there is a general presumption against applying that power in that course, and that is a presumption which the applicants must overcome in this particular matter.
PN773
So we say that, in essence, that that presumption is not one which can be readily displaced by the applicants in circumstances where there has been delay on their part as to the making an application to vary the 2002 Agreement. There was evidence before the Commission that there have been claims by employees who have not been - of Logistics who have not - there has been a claim by an employee before Logistics, who are not - that employee not being designated as a storeperson, who have asserted entitlements under the 2000 Agreement.
PN774
Mr Howell gave evidence that that claim was made in 2002. It was resolved in 2002, and despite this knowledge on the part of the applicant, no application to vary the 2002 Agreement was made until after Ms Bassett and Mr Ford raised a claim in respect of the application of the 2002 Agreement in relation to severance to their employment.
PN775
So we say in that circumstance there has been delay. My learned friend said, well, there must be added factors, mere delay is not sufficient. In that regard, your Honour, if that be the case, we had the evidence of Mr Gray where he has stated in his affidavit, and I will take your Honour to that particular passage under tab C of the supplementary folder. At paragraph 16 he recounts the fact that the files were stored in his name, the dates of 1996, '97 and '98, and that he further recounts the fact that those files stored in his name were destroyed on 31 December 2002 and that he considers that it is possible that documents destroyed included files that related to the negotiation of the 1997 Agreement.
PN776
Now, those documents, your Honour, would presumably be of some assistance to the Commission, perhaps to the interveners in relation to the making of the - in relation to the intention of the parties in relation to the 1997 Agreement which was, as we submit, the critical factual transaction, and in that circumstance we have the added element if that be said to be the requirement and mere delay not be sufficient.
PN777
So, your Honour, that is a factor that we rely on to submit that even if the Commission had the discretion to vary retrospectively, it should not do so in the circumstances which have now arisen where the applicant has delayed its application to the Commission to vary the agreement.
PN778
I wish to say something also, your Honour, as to the form of the amended order that the respondent seeks to make.
PN779
THE SENIOR DEPUTY PRESIDENT: It was marked CML6, I think, Mr Farouque.
PN780
MR FAROUQUE: Yes, I have it now, your Honour. Your Honour, we would submit that if the Commission is minded to make the order which the respondents seek - that the applicants seek as against the submissions that we have put, we would submit that it should make the variation in the terms of the original order and should not vary the order in the terms of the amended draft order. And the reason, your Honour, being this that a clause to that effect being that the agreement shall not apply to management employees would, in effect, give the applicant a capacity to, in effect, designate certain employees as management employees.
PN781
Now, we have the evidence of Ms Bassett, which is contained on exhibit 2 of the interveners' material. It refers to a number of categories of employees performing general clerical and administrative tasks. Now, Mr Howell in his original affidavit of 3 June referred to the fact that many employees performing clerical and administrative tasks are classified as store workers under the terms of the agreement. Now, it is not difficult, your Honour, to conceive of a circumstance where workers performing those functions referred to the affidavit of Ms Bassett could be designated as management employees by a stroke of a pen, inclusion in the management chart, an example of which my learned friend has relied on. In that particular circumstance, your Honour, we would submit that it wouldn't be consistent - wouldn't be a proper course for the Commission to vary the agreement in the terms sought in the amended draft order.
[2.48pm]
PN782
Your Honour, in relation to that matter, we say that further to that the amended draft order refers to two particular positions, the Human Resources Manager or the Human Resources Officer. Now, it is evident that is a specific reference to the interveners, and on any view it can't be said that the mutual intention of the parties was that more so than any other category of employees at the time that this instrument was to made, these two particular employees were to be excluded from the operation of the agreement. On any view, it can't be said in terms of what is said in that last sentence of the amended draft order that the mutual intention of the parties was the specific exemption or exclusion of the two interveners.
PN783
Your Honour, I will just make some concluding remarks about the NUW letter which was before the Commission or sent to the Commission. We say this in relation to that matter, your Honour, that firstly, it doesn't refer to what the intention of the NUW to - what the intention of the NUW was in the context of the making of the 1997 Agreement which, as I have submitted, is the critical event, it refers to the 2002 certified agreement.
PN784
Furthermore, your Honour, we say that the statement there is, in effect, ambiguous. It could be read as saying that the matter in respect of the application of the agreement was not the subject of consideration on the part of the NUW, it did not turn its mind to that particular issue, the reference being there was no intention for the agreement to cover managers at the Woodlands Distribution Centre. So we say, in effect, that that is ambiguous, it doesn't properly throw a light on what, if any, actual intention the NUW had in 2002.
PN785
That concludes the submissions on the part of the interveners.
PN786
THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Farouque. Anything in reply, Mr Bourke?
PN787
MR BOURKE: If I could, thank you, sir. Sir, can I just deal with the heavy reliance on the 1996 Kmart Agreement. The evidence is from Mr Gray, which is unchallenged, that he did not see any of the correspondence from the NUW back to Logistics on that issue and that that cannot then be taken into account in terms of the context of 1997 Agreement. Plus you have a clear explanation for the change in drafting as that correspondence was from federal office and the 1997 Agreement was - they dealt with the state office.
PN788
There is then a reliance on the different wording of the Hoppers Crossing and MGB Agreements which had express exclusions for management employees, and the clear answer to that is the different drafters. You can't use that as evidence of the true intent of the parties.
PN789
There is then - dealt with Mr Gray's evidence regarding the 1997 Agreement and, your Honour, that was unequivocal. His evidence was clear that it did not cover management. He gave evidence of the conduct of the NUW, that they showed no contrary intention, and that it would have been a rewriting of the industrial landscape for management to be put on the agenda. We say it is absolutely a leap of faith that they first construe the May '96 NUW letter from head office where it refers to "employees", or they qualify by "on behalf of our members" as - that is opening up the whole thing.
PN790
That was clearly on any view, even if that construction was correct, put to bed immediately. There is no evidence that was ever resurrected, no document trail that was ever resurrected, but then they somehow suggest that the reference to "employees" in the 1997 agreement meant everybody, when clearly the response made by Coles Myer to that agreement was just underlining the fact that they would negotiate people outside the NUW coverage themselves.
PN791
An argument has been put that the application clause is clear on its face and reliance was made to Spalding. Can I just say something about the Spalding case which is at tab A1. It has been - time and time again that one doesn't just pull out a set of words and then just adopt the same meaning because they were - that meaning was construed in a different case, and this was a clause which didn't just mention employees, had a much more powerful statement of "each and every person employed by the respondents in the clothing industry". And even with that width at page 2 of Wilcox Js judgment, line 10, he makes a reference to the fact that that would still not include everybody working with the respondent such as a truck driver or lift mechanic, so some quality of assessment still needs to be made even with that breadth of expression.
PN792
Although his Honour did not rely on it as necessary, he did find that the classifications were broad enough to include the relevant appellant, and there was a classification of any other classifications so it left everything completely wide as picking anybody up. Marshall J took the view that the classifications were sufficiently broad with a catch-all any other classifications that could have picked up the appellant.
PN793
But this case does highlight, your Honour, that the threshold test is only arguable, and even in this case where the application clause was so wide, "each and every person employed", you had the industrial magistrate, Federal Court Judge at first instance actually accepting the fact that the appellant did not come within the classification, the clause should be read down. In the circumstances of this case, the Full Court by a majority took a different view. But we have, unlike this case, also very strong evidence of the surrounding circumstances and the non-application of the rest of the award which puts this in a different ballpark.
PN794
Your Honour, the other point is that in terms of arguability, there was a minority decision of Dowsett J, and although we are talking about different words, his discussion is very apt when looking at our case. When he looks at the word "employ" at paragraph 64, page 11:
PN795
The word "employed" might encompass the appellant's relationship with the respondent ...(reads)... to distinguish between those who are demanding improvements in their conditions and those who are responding on behalf of the employer.
PN796
There is then a discussion of the difference between staff, salaried staff, managerial and salaried staff. His Honour ultimately found in dissent that given even the extraordinary breadth of that application clause, it did not apply to the appellant. So there is clear ambiguity even in relation to the Spalding case which was a much broader term. We have a much stronger case in that we have the overall context of the agreement and the overwhelming evidence of the surrounding circumstances and the history in which the clause had operated for five years from 1997 and subsequently in inferring intent.
PN797
We are left with as the contrary argument this clutching of straws linked between the 31 May 1996 NUW letter, which is ambiguous on its face, and the wording of the 1997 agreement with no evidence suggesting any link at all either by way of oral evidence or documentary evidence.
PN798
We point to the fact that the focus of the submissions has been on the 1997 Certified Agreement and not the 2002 Certified Agreement. My learned friend says you need to prove the mutual intention of the parties; you haven't heard from the other side. That, with respect, is a nonsense submission. You are entitled to exercise your discretion by drawing inferences from the conduct of the parties, the conduct of the evidence, and there are many cases where the actual parties will be in dispute and give contrary evidence and the court can find, no, I find the mutual intention was this, despite what the employer said or despite what the union said.
PN799
If my learned friend's argument was correct, if we had a case where the NUW took a different view and wanted to oppose, all they would have to do is not turn up because you have only heard one side. You can infer from conduct and surrounding circumstances the mutual intention. You have heard the positive evidence of Coles Logistics from 1997 throughout to 2002 and evidence uncontradicted that the conduct of the NUW was consistent with that, and you not only have that type of evidence, you have documentary evidence from the NUW which sets out a paper trail of intent: the notice of initiation of bargaining period, the statutory declaration, you have the decision of Commissioner Leary. And that was criticised, but the fact of the matter is if Commissioner Leary used the same expression on the same day for a number of certifications, that does not mean that the expression was incorrect.
PN800
My learned friend hasn't said any of the other statements that the certified agreement only cover the classifications was incorrect, and the fact of the matter is you had the conduct of the parties, and no-one stood up and said, no, sorry, this certified agreement is to operate in a much more broader way.
PN801
We have the fact that - I made the point the striking way or way Mr Howell was cross-examined where there was no direct allegation "this was not the true intent", the allegation was put in a very circumvented way. In fact, the cross-examination of both Mr Gray and Mr Howell really tip-toed around the critical issues in terms of their case.
PN802
This is really in no way a Beltana type case. If any slight evidence resulted in the Commission being paralysed in making a decision as to mutual intent, it would empty that section of content in any type of proposed application. There has been no explanation - we had the proof in the pudding in that the conduct of the parties over this five years is consistent with management not being covered. This is not a task of divining the intention. The material is overwhelming.
PN803
We then have this extraordinary omission, the failure to call Ford and the explanation is well, he didn't know anything about what happened in 1996. The 2002 Agreement is why we are here. He is at the coal face. It would be extraordinary that during negotiations there is no discussion about the impact on management if they are meant to be covered.
PN804
Can I then deal with the invalidity issue. As your Honour says, we just point to that as an aid in the surrounding circumstances, not that you work backwards, but you can infer with seasoned players, NUW/Logistics, they were going about their activities to ensure valid certification which reflected their understanding of the true intent of the agreement and that your Honour should err on the side of ensuring that the agreement is valid in terms of your construction, and there has been no challenge to our submission that if their construction is adopted, there is invalidity.
PN805
[3.05pm]
PN806
Can I move to retrospectivity. My learned friend does not cite any authority to suggest there is no power for retrospectivity. There is an abundance of cases to the contrary. Further to that, the power of variation of a certified agreement in a sense is not retrospective. It is just in fact restoring the document to its original intent. So it would be extraordinary if there wasn't the power for it to operate as at the date of the agreement. That is fundamental to any operation, for example, at common law rectification. And there would have to be express words to deny that power. And we say there is a source under sub-sections, part 6, if not 5, or 146. And the discretion on timing. My learned friend took to the case regarding awards and being - not being retrospective, or reluctance.
PN807
That is obvious, in terms of industrial dispute, not making it retrospective except in exceptional circumstances. Yet Finkelstein J's statement in Warramunda, which I took you to, pointing out that, yes, of course the award is one thing, but reinstating the mutual intention is another. And the course adopted by Ryan J and North J in his comments are the same in terms of the role of the Commission would be emptied, if you cannot make a variation that operates from the day of operation on the certified agreement. And my learned friend's point about you need express language. Express language is that, for example when an act creates an offence, you would need express language that operates retrospectively. Not in terms of creating a source of power, unfettered power, unfettered exercise of discretion, to vary a document.
PN808
Now can I just deal with delay. We say there is no proper basis that we are shut out because we had a one off claim back in 2002. It was settled without - unless there is some - if there is some dispute about this, I can tender the document. Settled by way of deed or release without admission - with denial of liability on 21 November 2002. And the only prejudice point to, is a speculation that some documents in a box may have helped their case. They were destroyed on 31 December 2002. So we would even have to get on our bike. We were going to respond to what appeared to be a one off speculative claim, which we settled, with a denial of liability.
PN809
And the issue only comes up again - it is competing prejudices, your Honour, not just one way traffic. The termination of Ford and Bassett was the end of November 2002. They do one - demands - don't even rely on the agreement. And we get a new demand from a new set of solicitors in 1 May, I think it is, 1 May 2003, saying we are covered by the certified agreement. And we have filed within a month, and it is still June. And we are hearing the final case. That we have not dragged our feet.
PN810
And if you look at - if there is any prejudice suffered to them, you have got to weigh that against the prejudice to us. We are facing a demand that we have to pay an extra 132,000 to Ms Bassett, under the formula, in the certified agreement, as against the - what she was paid, which is in the folder. I think it is some 70,000 odd gross - chapter 13 and 14. And Mr Ford, an extra $111,800. So that is real prejudice, if this order is not made and not made to apply as of the date of operation of the agreement.
PN811
Now, can I move to the form of order? There has been uncontradicted evidence that the intention was the classifications as understood to operate, and that management were a discrete set of people, but not being treated to come within the classifications in clause 12. And it would undermine the purpose of this application if the variation was merely made in accordance with the first draft, and we go to the Federal Court and have another argument, well you technically may have come within the classification, but no-one dreamt it. And we are back to the invalidity situation.
PN812
And we say that the opportunities here and now, and we put the material in and they have not raised anything which suggests they in fact are covered by the classifications. They had no problem with the Hoppers Crossing wording, which had an express exclusion to apply to - not to apply to management employees. And we say this is appropriate, clearly reflected the intent of the parties that would not apply to management. And if under the award technically, management are covered, so be it. But the intention of the certified agreement was that management would not be picked up when those classifications were set out in clause 12.
PN813
Now my learned friend says, well they can just play with whoever is now management in order to play around with this agreement, and its operation. Clearly, they had to be genuinely management, genuinely part of the management structure, and any sham, won't stand up. But if your Honour is concerned, you could qualify the statement to not apply to management employees, who were management employees as at the time of certification. We will deal with that issue if you are concerned. But we adopted the fact that essentially the same language as the Hoppers Crossing Certified Agreement, which my learned friend didn't have any difficulty with.
PN814
There is then the suggestion, well why the further qualification, and that is because we are facing a case with Bassett and Ford, who want to put beyond doubt that management employees cover Human Resources Manager, and Human Resources Officer. And that appears to be undisputed. They are part of the management tree, but not put any evidence into the contrary. We don't want that point sleeping, and then to come up - to turn up to the Federal Court, and to be met with a case, well, we are never management, we are still covered.
PN815
And that is out of an abundance of caution. My learned friend says, well, that is not the mutual intention. Mutual intention is that it wouldn't cover management, which would include these two positions. We are just making that absolutely clear. Unless there are any other matters, your Honour pleases.
PN816
THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Bourke. I will reserve my decision. I am sorry, Mr Farouque?
PN817
MR FAROUQUE: No, I had nothing else to say, your Honour.
PN818
THE SENIOR DEPUTY PRESIDENT: I will reserve my decision. I will now adjourn.
ADJOURNED INDEFINITELY [3.pmt]
INDEX
LIST OF WITNESSES, EXHIBITS AND MFIs |
EXHIBIT #CML6 AMENDED DRAFT ORDER PN236
EXHIBIT #CML7 LETTER DATED 27/06/2003 FROM MR DONNELLY OF NUW TO SENIOR DEPUTY PRESIDENT WATSON PN237
EXHIBIT #CML8 FOLDER OF SUPPLEMENTARY MATERIALS WITH AMENDED INDEX PN249
EXHIBIT #CML9 NOTICE OF INITIATION OF BARGAINING PERIOD DATED 24/09/1996 PN250
EXHIBIT #CML10 OPEN LETTER DATED 18/09/1996 FROM NATIONAL UNION OF WORKERS PN251
TRISTRAM JAMES GRAY, AFFIRMED PN257
EXAMINATION-IN-CHIEF BY MR BOURKE PN257
CROSS-EXAMINATION BY MR FAROUQUE PN325
WITNESS WITHDREW PN345
PETER LEIGH HOWELL, SWORN PN347
EXAMINATION-IN-CHIEF BY MR BOURKE PN347
CROSS-EXAMINATION BY MR FAROUQUE PN409
RE-EXAMINATION BY MR BOURKE PN432
WITNESS WITHDREW PN436
EXHIBIT #MK1 AFFIDAVIT OF MS BASSETT SWORN ON 27/06/2003 WITH ATTACHMENTS PN442
EXHIBIT #MK2 FOLDER CONTAINING OUTLINE OF SUBMISSIONS ON BEHALF OF INTERVENERS, STATEMENT OF MS BASSETT AND SERIES OF 19 OTHER DOCUMENTS PN445
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