C2003/4090, Transcript of Proceedings [2003] AIRCTrans 3015 (16 July 2003)

AUSCRIPT PTY LTD
ABN 76 082 664 220

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

TRANSCRIPT OF PROCEEDINGS


O/N 3554
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER BLAIR

C2003/4090

CONSTRUCTION, FORESTRY,
MINING AND ENERGY UNION

and

PILKINGTON (AUSTRALIA)
OPERATIONS PTY LTD

Notification pursuant to section 99 of the Act
of dispute re the alleged failure by the Company
to pay correct redundancy entitlements to their
employees at their Ballarat Operations

MELBOURNE

10.12 AM, THURSDAY, 3 JULY 2003

PN1

MR R. LOWE: I appear for the CFMEU. Appearing with me is one of the union organisers, MR R. MAHER.

PN2

MR G. SOUTHWARD: I appear on behalf of the employer, Pilkington (Australia) Limited and appearing with me, MR M. GLEESON.

PN3

THE COMMISSIONER: Thank you, Mr Southward. Yes, Mr Lowe?

PN4

MR LOWE: Thank you, Commissioner, this dispute is regarding the failure of - by the company in the view of the union to pay correct redundancy entitlements to a number of employees who were made redundant at their Ballarat operations when the company closed that operation down recently. The employees' concerned terms and conditions of employment are governed by the Pilkington (Australia) Operations Limited Victorian State Operations Enterprise Bargaining Stage 5 Agreement 2000 and the Glass Merchants and Glazing Contractors General Victoria Award. Commissioner, I provide you with a copy of the agreement just so you - if you wish to refer to it.

PN5

THE COMMISSIONER: Thank you. Yes?

PN6

MR LOWE: I want to, first of all, refer the Commission to clause 15 of the agreement which is on page 9 at the bottom I think and that provides for the parties to agree to abide by the Pilkington (Australia) Operations Limited Victorian State Operations Redundancy Agreement 2000 as signed between Pilkington (Australia) Operations Limited and the Construction, Forestry, Mining and Energy Union FFDS Union Division. I want to also refer the Commission to clauses 6 and 7, Commissioner, and they are on page 3 and in clause 6 which deals with the relationships of the parent award at paragraph 3, that reads:

PN7

The company and the union agree that there will be no change to the current award and EBA conditions as set out above for the life of the agreement unless agreed between the parties.

PN8

And then at clause 7 which is the objectives of the agreement, probably about, less than two-thirds of the way down that paragraph, it reads:

PN9

It is recognised however that different locations may have different needs and these will be discussed between local management, the union and employees and this will ensure items agreed are relevant and effectively applied at each location to ensure the best work practices and improved customer services.

PN10

That indicates, Commissioner, that there was normally a consultative process which applied at the company and any changes to what was negotiated at the time would only be changed by agreement, Commissioner. I would like to tender at this stage, Commissioner, two further documents which are redundancy agreements that have followed - with Pilkington's Glass operations. I would like to refer the Commission, in the first instance, to the Pilkingtons (Australia) Operations Limited Victoria Redundancy Agreement 2000 which was the one that was referred to initially in the enterprise agreement and specifically to clause 10 which is on page 4 of 6 which is the calculation of redundancy benefits and specifically to sub clause (d)(ii) which provides that:

PN11

In addition to the above all retrenched employees shall be entitled to the following, loading on long service leave as determined by company policy.

PN12

And this is the dispute that we have between us at the present time, is the non payment of that 17.5 percent on the employees that were entitled to long service leave.

PN13

THE COMMISSIONER: You say this agreement applies - I note that Ballarat, as such, is not mentioned but Wendouree, which is, I understand, a suburb of Ballarat, is that right.

PN14

MR LOWE: Yes.

PN15

THE COMMISSIONER: Yes.

PN16

MR LOWE: My understanding, sir, is that this is the agreement that applies to a number of the company's glazing operations.

PN17

THE COMMISSIONER: So it is the loading on the long service leave.

PN18

MR LOWE: Long service leave, that is a dispute between the parties. Now, the previous agreement, if I can take you to that, that second document that I handed up to you, again, which is under the same title. I take you to the second page of that to clause 4 which is headed, "Supplementary provisions" and this deals in sub clause (c) with this particular issue which clearly specifies that:

PN19

Pro rate long service leave which is not already a statutory entitlement and where the retrenched employee has more than five years continuous service including 17.5 percent loading.

PN20

That is one of the entitlements that was paid out under that agreement. Now, Commissioner, I am instructed by the assistant secretary of the union that when the agreement was negotiated that the difference between the two agreements and the change that is in the 2000 agreement was agreed to on the basis that the company advise the union that the company's policy was to pay 17.5 percent loading on the long service leave as in the previous 1996 agreement. That there was no intention to change that policy and that if the company even considered changing that policy then the consultative procedures that were in operation would apply.

PN21

And I have referred - I have taken the Commission to this clause 7 of the enterprise agreement previously which deals with the objectives of the agreement and deals with the issue of consultation and also in clause 7 that there was an agreement that there would be no change to the current award and EBA unless there was an agreement between the parties. So the union felt comfortable with the change that was made on that basis. The union was also aware of agreements with Pilkingtons which also provided for the 17.5 percent loading and if I can provide the Commission with two further documents.

PN22

The first document, Commissioner, is print - is an enterprise agreement, print T2428 which is Pilkington (Australia) Operations Limited Automotive Division Geelong Enterprise Bargaining Agreement and I want to take the Commission to page numbered 4 at the top but I think it is the third page in the document and the heading of this clause which deals with additional benefits. And that reads, Commissioner:

PN23

In addition to the benefits listed above retrenched employees will be entitled to the following.

PN24

And then (a) it says:

PN25

A 17.5 percent loading on pro rata annual leave and long service leave.

PN26

So that is what applies both at Pilkingtons Automotive Operations at Geelong and also at their Laverton site. The second document, Commissioner, is an agreement which applies to Pilkingtons but does not affect the members of our union but it is the document which applies to the company's operations at their Dandenong site and this is their enterprise agreement 2002 to 2004 and so this is an extract from that full enterprise agreement in the second page. And I have included the full redundancy agreement but at appendix C it clearly states that this is a national redundancy agreement, which is the heading.

PN27

So this has, you know, universal application within Pilkingtons. And then at clause 5 which is on page numbered 36 at the bottom which I think is the second last page of the document that I have handed to you. The supplementary provisions - it provides for at item C:

PN28

Pro rata long service leave where it is not already a statutory entitlement and where retrenched employees have more than five years continuous service 17.5 percent loading will also be payable on this, specifically, paid out through an enterprise agreement.

PN29

So there is - - -

PN30

THE COMMISSIONER: Mr Lowe, that document, the last enterprise agreement, although appendix C says national redundancy agreement - - -

PN31

MR LOWE: Yes.

PN32

THE COMMISSIONER: - - - it does say, and the title of the agreement, is that it is a Dandenong enterprise agreement.

PN33

MR LOWE: I understand that, Commissioner, but the point that I am trying to make is that throughout, I guess, all the areas of Pilkingtons that we have with the 17.5 percent loading applies. Now, I have been instructed that the 17.5 percent loading applies to, I guess, administrative staff. I don't know whether that is by way of any specific agreement which is certified in this Commission or by way, just simply, of policy. But it was clear to the union that at the time they negotiated the latest enterprise agreement that the provisions that applied in respect of a redundancy situation would continue to apply.

PN34

So we have got it at the automotive, we have got it at Dandenong. We are aware that it applied in respect of their administrative staff and we were unaware that there had been any change in policy until Mr Rick Maher the organiser who deals with the Geelong and Ballarat areas was advised by the company that the policy had changed and the 17.5 percent loading was no longer going to be available to employees. Now, I have a statement from Mr Rick Maher in the form of an affidavit which we are willing to have him questioned on should the Commission desire or the employers desire.

PN35

This statement, Commissioner goes to the, I guess, the heart of the issue, that when there has been any changes in policy within Pilkingtons and the areas that he has dealt with as a union organiser, and previously to that as an employee of Pilkingtons, that there has always been negotiation. There has always been the ability for the union to be able to reach an agreement with the company on that and so we wouldn't be in the situation that we are in now where we find that when people are in the unfortunate position of being made redundant that there has been a unilateral change to this policy whether that policy change was made by Mr Russell Howard who was, I understand, I guess, the person with the utmost responsibility within the company or not, I am not sure.

PN36

But I am instructed, Commissioner, that there was no indication at any stage that the provisions that applied at Ballarat and at their other glazing operations was going to change. I am also instructed, Commissioner, that in some discussions between the union and the company our assistant secretary, Mr Frank Varry was indicated to have - that the 17.5 percent leave loading, which is in dispute between the parties, could be resolved and paid out if the union was prepared to make certain concessions in the next enterprise bargaining agreement which is due to be negotiated in the next few months.

PN37

And I am advised by Mr Varry that this was rejected out of hand by them. I further advise, Commissioner, and I think that there are four people affected and the amount of money involved is somewhere in the vicinity of $6500, depending on the length of service there is between the employees. The union submits, Commissioner, that the company has unilaterally changed its policy in respect of the payment of leave loading contrary to undertakings given to our negotiators during the enterprise agreement. We believe, Commissioner, that they breached the provisions of the EBA in respect that there is a commitment that there would be no changes to the award and EBA conditions unless there was an agreement between the parties.

PN38

And the fact that this action has been taken by the company is placing in pretty severe jeopardy the, I guess, the relationship that the union has had with Pilkingtons over the years. If the Commission pleases.

PN39

THE COMMISSIONER: Yes, thank you. Yes, Mr Southward?

PN40

MR SOUTHWARD: Commissioner, the circumstances surrounding this dispute are that five employees were retrenched from the Pilkingtons (Australia) Operations Limited business located at Ballarat. All five employees who were retrenched were paid significant redundancy packages as per the current agreement in place between the CFMEU and the company. Parts of that agreement include four weeks pay per year of service, ex gratia payments and payments of all accrued sick leave as at the time of retrenchment.

PN41

Of those five employees who were retrenched three employees were offered ongoing employment with the purchaser of the site where the company had previously traded. Two employees had found ongoing employment within weeks of having been retrenched from Pilkingtons, effectively, meaning that all those retrenched employees, to some extent, had small amounts of period of unemployment and all are now currently working still within the glass industry. The areas of dispute we are here today to talk about are areas surrounding the clause 18.1 of the Pilkington (Australia) Limited Victorian State Operations Enterprise Bargaining Stage 5 Agreement 2000, the dispute settlement procedure, of which a copy has been given to you.

PN42

Clause 15 of the Pilkington (Australia) Limited Victorian State Operations Enterprise Bargaining Stage 5 Agreement 2000 - the clause surrounding redundancy. The uncertified Pilkington (Australia) Operations Limited Victorian State Operations Redundancy Agreement 2000 and the Long Service Leave Company Policy. Within the State operations business unit of Pilkington we - there are no certified redundancy agreements. We currently exist with two uncertified agreements, the one here in Victoria and one in Queensland. Neither of those - those agreements, in their written form, allow for payment of long service leave.

PN43

In all other business units within State operations in the States of New South Wales, Western Australia, Tasmania, South Australia and the territories of ACT and Northern Territory, award provisions apply. The company policy regarding long service leave, that Mr Lowe has informed us of has not changed since 1997. There has been no change of company policy with regard to loading on long service leave. The matter before the Commission today we are - we are unsure that the matter is properly before the Commission and whilst we are here today in an effort to resolve the matter, we do reserve our rights to argue jurisdictional issues if the need does arise but we do have no objection to the Commission conciliating on this matter today.

PN44

THE COMMISSIONER: Right, thank you. All right, the Commission will go into conference, thanks.

NO FURTHER PROCEEDINGS RECORDED