AG2003/298, Transcript of Proceedings [2003] AIRCTrans 4316 (30 September 2003)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

MUNRO J

AG2003/298

APPLICATION FOR CERTIFICATION OF AGREEMENT

Application under section 170LK of the Act
by Wenco Pty Ltd for certification of the
Wenco Pty Limited Certified Agreement 2003

SYDNEY

3.05 PM, FRIDAY, 12 SEPTEMBER 2003

Continued from 6.8.03

PN81

HIS HONOUR: This matter was before the Commission on 6 August and a direction was issued on that day for Wenco to lodge and serve on the AMWU written submissions and supplementary evidential material; the AMWU to lodge by 3 September submissions in response. Identification of evidential material not lodged by 11 September would be not received as part of the case and there was an arrangement for the transcript to be available. I note that there is before the Commission on file a letter dated 15 August 2003. I will mark that as Exhibit Wenco 2. That concerns a number of matters but it is effectively a statement by Mr Moss attaching an assessment report of Mr Ciaulo and also making an indication of how the ballot was conducted.

EXHIBIT #WENCO 2 LETTER DATED 15/08/2003

PN82

HIS HONOUR: In addition, I have received on 27 August a document headed Wenco Submissions which I will mark as Exhibit Wenco 3.

EXHIBIT #WENCO 3 WENCO SUBMISSIONS

PN83

HIS HONOUR: And associated with that is a statutory declaration executed by Phillip Smith which I will mark as Exhibit Wenco 4.

EXHIBIT #WENCO 4 STATUTORY DECLARATION OF PHILLIP SMITH

PN84

HIS HONOUR: There has also been forwarded by facsimile received yesterday a written submission by the AFMEPKIU. That submission is not lodged within the time but was described in the directions. Subject to objection I will mark it for the time being as AMWU1.

EXHIBIT #AMWU 1 SUBMISSION BY AFMEPKIU

PN85

HIS HONOUR: That covers the correspondence as far as I am aware that is before the Commission at the resumed hearing. Transcript did issue and I think the parties should have copies of it. Is there any change to appearances?

PN86

MR EDMONDS: No, sir.

PN87

MR MOSS: No, sir.

PN88

HIS HONOUR: Yes, Mr Moss, I think the ball might be in your Court.

PN89

MR MOSS: Thank you, sir. On the hearing regarding application on 6 August, a number of issues were raised concerning the agreement. In summary, there was a primary compliance of the agreement with no disadvantage test as prescribed by Section 170XA of the Act. The other issue was the ability to ascertain the rate of pay applicable to individual employees under the agreement.

PN90

The matter was also raised by the AMWU concerning that the Commission should cease dealing with the matter under Section 111AAA of the Act. With respect to that one, I note the submission by Mr Edmonds lodged yesterday indicated that the union no longer wishes to pursue that argument, and on that basis I would not wish to add anything further regarding that issue today beyond that identified in our written submissions on the 27th. And the final matter which was raised was that the employee, Mr Anthony Ciaulo, was not advised of the applicant's intention to make the agreement.

PN91

If it pleases the Commission, I will start with the first issue regarding the no disadvantage test. On the proceedings on the 6th, the Commission raised concerns regarding compliance with the no disadvantage test against the State Metal Trades Award. In particular, concern was raised that the agreement does not provide for all of the special rates provided in clause 18 of that award; that the leading hands allowance provided in clause 31(2)(a) of the award was not contained; location allowances in clause 22 and additional leave for continuous shift workers as per clause 23(4) of the award.

PN92

With regard to the no disadvantage test, I note that 170XA(1) of the Act provides that an agreement passes the no disadvantage test if it does not disadvantage employees in relationship to their terms and conditions of employment. I would therefore submit a necessity agreement against the award is necessary only to assess those terms and conditions provided by the relevant award, which are appropriate to these employees to whom the agreement seeks to cover.

PN93

In the statutory declaration provided by Mr Smith to the Commission on 27 August, identified in that as well as the written submission of the same date, was information that in developing this agreement consideration was given to those terms and conditions which were directly relevant to the award, and the statutory declaration seeks to go into some detail regarding why some of the allowances are not applicable to those employees.

PN94

HIS HONOUR: Yes, I've read all those, thank you, Mr Moss.

PN95

MR MOSS: Yes, thank you, sir. However, the applicant does recognise the concerns that the Commission raised regarding the impact of the agreement on employees should changes in the organisation's operations or practices result in those award conditions not dealt with under the agreement having application or relevance to their employment in the future.

PN96

In light of that, I would therefore raise for the Commission's consideration that the applicant would be willing to make an undertaking under Section 170LV that the agreement is to be read ..... wholly in conjunction with provisions of the Metal Trades General Award provided that, where there is an inconsistency, this agreement shall take precedence as a potential means by which the Commission's concerns regarding compliance with the no disadvantage test may be addressed. Such undertaking, I believe, would not be inconsistent with the operation of the agreement, nor would it represent a substantial change to the contents of the agreement.

PN97

HIS HONOUR: Yes.

PN98

MR MOSS: I would also at this stage raise concerns regarding the operation of clause 12, in which the Commission raised that it might be difficult to ascertain the rate of pay applicable to an employee for the purpose of calculating their entitlement under the agreement, in particular where there was a dispute regarding that. Also is raised in the written submissions employees who are currently - at Wenco employees currently ..... are based on their classification, skill and productivity, and that has resulted in a differential in the rate of pay received by individual employees.

PN99

Notwithstanding this, there is a similarity in their rates of pay for their relevant classifications, and the differences in those differ no more than about by 50 cents per hour; the appropriate rates being for a C10 classification $16 per hour, C11 $15.50 per hour and C12 $14 per hour, each of these being sitting above the rates prescribed by the Metal Trades General Award. These are currently the only three classifications to which employees are engaged in by Wenco.

PN100

On 6 August you raised the possibility of an undertaking under Section 170LV as a mechanism by which difficulties regarding - in ascertaining the rate of pay may be overcome. In the written submissions I've raised the possibility of an undertaking detailing these benchmark rates of pay for the purpose of this agreement as a mechanism by which these concerns could be overcome. An additional benefit of this would also be by the clear indication that the award rates of pay for the employees covered by this agreement - those significantly above the award rates of pay. In doing that that may also address further concern regarding the no disadvantage test as well.

PN101

HIS HONOUR: Yes.

PN102

MR MOSS: I will therefore submit that in doing this that may seek to overcome some of those concerns. Failing that, information has been provided to you by the statutory declaration and in the written submissions as well which do detail, we believe, some of the allowances and in particular the location allowance under the award but not actually of - do not have application to the employees at this point in time.

PN103

HIS HONOUR: Yes, thank you.

PN104

MR MOSS: If it is of assistance, Commissioner, I can actually run you through those.

PN105

HIS HONOUR: I've read that material too, Mr Moss.

PN106

MR MOSS: Okay. Thank you, sir. We've respect to continuous shift we did raise in the written submission that whilst shiftwork is not a feature of employment at Wenco it was decided to employ shift provisions for the purpose of any event that they may be applicable in the future. Unfortunately, there's a draft in there of the additional week where it was not incorporated with respect to that and that was something which we will seek to resolve as well. The issues of casuals was also raised regarding the interpretation of the award. In particular the clause - Clause 6 - of the Metal Trades Award has a deeming provision which states that employees who are employed for less than one night in set circumstances are deemed to be casual.

PN107

We would submit that that clause does not limit the ability under the award to have casuals for longer periods of time given the operation of Clause 5 of that award which defines a casual employee as an employee engaged and paid as such. In the written submissions I incorporated a section from a Full Bench decision of the Western Australian Industrial Relations Commission where it's actually looked at that matter and found that the reading of the award does not exclude any common law prescription of definition of a casual employee whereas a person who is engaged for more than one month may not be deemed to be a casual employee under the award but may still be a casual employee having been engaged as such.

PN108

With respect, the union also raised in its written submission that it provided yesterday a number of other concerns that it had regarding what it believed were not features incorporating administrative things as well. With respect to those they raised that the agreement would prevent, or exclude, any representation of the employee. We would submit the agreement does not in any way affect the employees' rights under Part XA of the Act regarding their ability to join and be a member of the union nor for the union to act on their behalf.

PN109

Furthermore, the dispute settlement procedure in the agreement explicitly provides for the employees the right to be represented in dispute regarding the agreement and in that those represented could well be in the union if those so chose or for that matter anyone else that they deemed appropriate. They also raised concern that in having the agreement would restrict their ability to access time and wages records for the purpose of investigating a breach. With respect to that I've directed to Section 295B of the Workplace Relations Act which provides in it the ability to access time and wages records under a Federal Certified Agreement.

PN110

Concern was also raised with respect to the agreement not providing for maternity leave. Schedule B of the agreement provides for a free to leave clause which is in line with the Workplace Relations Act which provides for not only maternity leave but paternity and adoption leave as well. Issues were raised also regarding the copy of the award and provision of union noticeboards. With respect to that we would suggest that all employees are actually being provided with a copy of the agreement itself which details relevant terms and conditions of employment and that information is freely available to the employees.

PN111

With respect to the issue of noticeboards, a noticeboard is not a matter between the employee and the employers and Section 170LI of the Workplace Relations Act provides that for an application to be made to the Commission under this Division there must be an agreement in writing about matters pertaining to the relationship between an employee - between (a) the employer and (b) all employees who employment is subject to the agreement. Issues regarding some union noticeboards we would say is not a matter between the employer and the employee rather one between the union and the employer.

PN112

Given that there's been a number of recent decisions regarding the inclusions and matters not relating to the employment relationship in developing the agreement it was believed that it would be inappropriate for an agreement to contain such provisions. In particular, given the recent decisions regarding bargaining agents' fees clause, in particular, a decision by Commissioner Grainger cited in matter PR922568 regarding various agreements under the Electrical Contracting Industry in which the agreements contain clauses not relating to the employment relationship and that's actually not certified on that basis.

PN113

But the union has also raised its concern about the clause not - the agreement not providing the ability for employees to be informed in events of significant effect. We would direct their attention to Clause 29 of the agreement which actually provides for discussions with employees in effect in the event or change to a significant effect to the employees. Concern was also raised regarding the ability for disputes concerning the meaning and effect of the agreement to be able to trade in an appropriate jurisdiction. Clause 31 of this agreement provides for dispute settlement procedure which provides a role for the Australian Industrial Relations Commission to mediate and arbitrate on matters regarding this agreement in the event it cannot be resolved at the workplace level.

PN114

Sir, it also raised issues concerning Mr Anthony Ciaulo. The union raised concerns that an employee on workers' compensation, then Mr Ciaulo, was not advised of the employer's intention to make the agreement in accordance with 170LK of the Act. This section essentially providing that an employer must take reasonable steps that every person employed at the time of his employment will be subject to the agreement has at least 14 days notice in writing of intention to make the agreement and that the agreement has not been made before those 14 days had passed.

PN115

We would submit that Mr Ciaulo, who had suffered an injury in January 2003, which has resulted in being unable to carry out his pre-injury duties or any alternative duties since that date. A copy of the initial assessment report on Mr Ciaulo's injury and the subsequent progress report provided on 28 April 2003, June 2003 and 25 June 2003 have been submitted and these indicate that the employee is actually unable to return to his pre-injury occupation and that alternative positions are unable within Wenco.

PN116

Training is also being provided for Mr Ciaulo in alternative careers and Mr Ciaulo has accepted looking at training in these alternative careers, and, in particular, focus on either truck or crane driving. Both of these being roles not covered by the agreement actually before you, so even in the event that he did come back to work at Wenco in one of these alternative positions, in where he's being provided with re-training, it would be unlikely that he would be covered by an agreement in any fact. But essentially the Act requires an employer to take reasonable steps to provide the agreement and we would submit that there is consequently no requirement to provide an agreement or to provide the employee with notice to those employees who will not be subject to the agreement.

PN117

On the basis that all indications would show that Mr Ciaulo is unlikely to return to work at Wenco it has been appropriate for the organisation to conclude that there is no reasonable prospect of the agreement actually having any impact upon his employment in the future. Furthermore, the tests under the Act if you take reasonable steps based on the employer's understanding of Mr Ciaulo's future employment prospects we would submit that the applicant took all reasonable steps to employ those employees of the intention to make the agreement which the employer believed would be covered by this agreement.

PN118

In light of Mr Edmonds' submissions from yesterday we would also indicate that claimants made to Mr Ciaulo at this point in time were actually rather than being weighed in addition to the employment are payments made to the employee as compensation under the Workers' Compensation and Rehabilitation Act and not as a result of any agreement.

PN119

I would also raise with respect to that issue and on a more practical note that the voting with respect to this agreement that was carried out, of the 13 employees who were served notice 13 voted. 10 of those employees voted in support of the agreement and three employees against. And that even in the event that Mr Ciaulo's involvement in the voting period was reminded and also assuming that he voted and voted for the agreement not to have been made this would have had no practical effect on the outcome of the vote. Furthermore, both of those two assumptions could be held in the alternative as well.

PN120

Finally, sir, I also touch base again with respect to the issue that you raised concerning the ability to determine the actual rates of pay paid to these employees. As I've already mentioned the applicant would be willing to make an undertaking with respect to this issue to seek to overcome your concerns. We would also raise that information is currently sufficiently provided as far as pay slips concerning the employees' actual rates of pay, but in the event that there was a dispute concerning those with relative ease it would be able - the employer would be able to demonstrate their actual entitlement under their contract of employment.

PN121

HIS HONOUR: Yes, thank you, Mr Moss. Mr Edmonds, do you wish to say anything?

PN122

MR EDMONDS: Yes, sir. Thank you, sir. There is only two elements that I wish to address, sir, and it is true, sir, that we don't advance the argument of Section 111AAA any further, sir. The two issues that I wish to address today, sir, are the application of the no disadvantage test and the obligation of the employer to notify employees who would be subject to the particular agreement. If I can address the latter first, sir. The obligation under the Act is to provide reasonable steps to notify all employees whose employment will be subject to the agreement of the intention to actually make the agreement.

PN123

In these circumstances, sir, the employer took no steps to notify the employee on worker's compensation; took no steps whatsoever. They didn't take reasonable steps, they didn't take any steps. They took no steps whatsoever to actually notifying him of the intention to make the agreement. It is not important that that employee's vote wouldn't have made a difference to the final result. It's important that everybody whose employment will be subject to the particular agreement has an opportunity to be able to discuss it with their fellow employees, to be able to seek advice from the union as to that particular agreement and to be able to actually vote on that particular agreement.

PN124

Now, the situation is, sir, if there had of been five employees or six employees on worker's compensation all of whom hadn't been supplied with that particular agreement, the employer had taken no steps to actually notify them, then while that wouldn't have made a difference to the final outcome I don't think the Commission can certify an agreement in circumstances where the party advancing that particular agreement hasn't complied with their obligations under the Act. They haven't complied with their obligation to take all reasonable steps to notify all employees whose employment will be subject to this particular agreement of the intention to make the agreement.

PN125

The worker on worker's compensation is still employed by the employer at this point in time. He's still an employee. He is still entitled to be consulted about the agreement that will govern his employment. He is still entitled to have a vote. He is still entitled to have a say and he's still entitled to consult with his fellow employees about that particular agreement and he's still entitled to consult with the union about that particular agreement. He has been denied that opportunity, sir, and in those circumstances where the employer has taken no steps whatsoever to advise him of the intention to make that agreement then this agreement shouldn't be made.

PN126

It doesn't matter whether it's one employee, it doesn't matter whether it's 50. He hasn't had an opportunity to have an input. The principle is he should have that opportunity, he should have an opportunity to vote, he should have had an opportunity to have his say. So that's certainly the first issue, sir. The second issue is the application of the no disadvantage test, sir. In these circumstances, sir, the proposed agreement adds nothing to the employment of the workers that they don't already have. In these circumstances, sir, it's a blatant attempt by the employer to shift the regulation of his employees' employment out of the State jurisdiction and into the Federal jurisdiction, sir, and it doesn't provide any benefits to those particular employees for that particular move.

PN127

It's commonly known as jurisdiction hopping, sir, and it's trying to get into a more favourable jurisdiction to attempt to exclude the union from the workplace, sir. As was put to you previously, sir, on 6 August, sir, the union has initiated a bargaining period in the State jurisdiction with the company, sir, and upon that bargaining period being initiated the company has taken steps to move the employment of their employees out of the State jurisdiction and into the Federal jurisdiction in an attempt to exclude the union. It isn't because they are trying to offer a more favourable agreement to their employees, it's designed to exclude the union and that's the only role this particular agreement serves.

PN128

It excludes the union because the union will have no right of entry under these new agreements of 170LK. The union is not a party to it and they will have no right of entry under the Federal Act to consult or to actually meet with employees. They will have no opportunity under the Federal Act to inspect time and wages records or to participate in the workplace, sir. I would submit, sir, in those circumstances the right to be represented, the right for the union to come into the workplace, the right to have your terms and conditions of your employment assisted by the union or prosecuted by the union, sir - if those elements are excluded from your workplace, sir, the overall package that's been presented to these workers in the circumstances is a derogation from the workplace or the situation that currently exists in that workplace.

PN129

It's a step backwards for these employees. There is nothing that is being added to their employment but there is elements that are being taken away. In those circumstances, sir, it can't be anything but a step backwards. The no disadvantage test is not applied on a clause by clause basis but it takes a global approach to the comparison of the agreement with the appropriate award. The appropriate award in these circumstances, sir, is the Metal Trades General Award.

PN130

The employer has merely transplanted those clauses which it wishes to continue to apply out of the Metal Trades General Award and inserted it into this agreement. Otherwise, sir, it's sought to exclude the union from the workplace. It's sought to exclude the union from being able to inspect time and wages records and it's sought to exclude the union from having a right to - or from the workers from having the right to have Trade Union notices in their workplace to be stuck up on a pin-up board in an appropriate place in the workplace, which is a right of those employees to have access to union information, to have access to union documents.

PN131

It doesn't pertain to the relationship between the union and the employer, it pertains to the right of those employees to have access to that information; to have access to occupational, health and safety information; to have access to the Metal Trades General Award; to have access to those terms and conditions of their employment. In those circumstances, sir, I would submit that this current agreement cannot possibly pass the no disadvantage test. It is a step backwards in at least one case and arguably in a number of other places, sir, and as such, sir, it's a - if you compare the current employment situation to the proposed employment situation the new situation will be worse or have worse terms and conditions of employment, sir.

PN132

HIS HONOUR: Yes. Do you wish to say anything in reply, Mr Moss?

PN133

MR MOSS: Just very briefly, sir. What I'd reinforce with the written submission the information provided to you in the case that the employees are remunerated significantly above the provisions of the Metal Trades General Award and, in particular, the terms and conditions which are contained in the agreement of those which in our opinion - which are currently applicable to those employees. Furthermore, an undertaking as we've suggested would ensure that the other provisions of the award which may otherwise apply, particularly potentially in the future, would also be dealt with in the agreement. As such, based on those and the wages, we would submit that the agreement provides for terms and conditions of employment which are in excess of those provided by the Metal Trades General Award.

PN134

HIS HONOUR: What are they again?

PN135

MR MOSS: The grade for C10 is $16 per hour, for C11, the benchmark is $15.50 per hour, and in C12, $14 per hour. I can provide you with a comparison against the award, your Honour, on an hourly basis too. Under the award, the hourly rate equates to the C10, $14.26 per hour, for C11, $13.38 per hour, and C12, $12.83 per hour.

PN136

HIS HONOUR: Yes. The matter before the Commission is an application under Section 170LK of the Act for a certification of an agreement to be known as the Wenco Proprietary Limited Certified Agreement 2003. The parties to the agreement are Wenco and a number of employees said in the statutory declaration to be 13; but none of whom have signed the agreement and no direct evidence of many of whom has been put before the Commission. The matter was listed before me in video conference on 6 August at which time Mr Moss of the CCIWA appeared with Mr Smith for Wenco with Mr Peca, P-e-c-a, the Managing Director of Wenco. Mr Edmonds on behalf of the Australian Manufacturing Workers Union with Mr Mossington also of the AWU appeared.

PN137

That organisation, it appeared from the statutory declaration, had been requested to represent the interests of employees during the course of the negotiation. Mr Edmonds indicated that Wenco had for some time been the subject of the Metal Trades General Award nineteen ninety - 1966, a State Award, and there had been a dispute notified in relation to which the union was seeking negotiations under an outcome in the State Commission. Mr Edmonds made, or at least foreshadowed, an application under Section 111AAA of the Act. In the circumstances, after having indicated some concerns that I had about aspects of the proposed agreements, I stood the matter over subject to directions.

PN138

Under those directions, Wenco was required to lodge and serve copies of a written submission plus material in support of its application. Conversely, Mr Edmonds on behalf of the AMWU is required to do likewise in relation to his application. That direction was complied with by Mr Moss on behalf of Wenco and more or less complied by with Mr Edmonds on behalf of the AMWU although in the event, the AMWU did not press the application made under Section 111AAA of the Act. The issues that arise at the threshold concern whether or not, in effect, there is an agreement or an application for an agreement that is validly made.

PN139

The substance of the case that is made in this instance by the AMWU is that an employee, whose continuing employment status was in some question so far as the company is concerned but who was at the time on workers compensation, was not given the notification under Section 170LK(4), and did not have an opportunity to participate in the discussion or in the ballot. That employee, and I will treat him as being an employee for these purposes, is one of apparently 13 others who it is not in dispute were consulted. Exhibit Wenco 1 is a copy of the 170LK(4) notice.

PN140

It is apparent that the union was conscious of the negotiations that were to take place. In the circumstances - although I should not be taken in any sense to be condoning a failure to take effective steps to notify all employees whose employment may be subject to an agreement - I accept that the steps that were taken were sufficiently reasonable to satisfy the requirements of 170LK(4). I do not consider that it is in anyone's interests to have an over rigorous attention to the detail of that provision; although it is essential that the obligations to notify employees and to give them access where they seek it to union representation be observed. Mr Edmonds' submissions went to the prospect of a number of employees on workers' compensation not being notified.

PN141

That problem can be addressed in the case in which it arises. It is not this one. In reaching that view, I am influenced by the indication that there was a ballot conducted. The vote was 10 votes for and three against the endorsement of the agreement. Nothing that has been put by the union suggests that that vote was other than a free enough expression of opinion; although there are aspects of it that might cause some disquiet if they're examined overly closely. Nonetheless, the Commission is obliged to act on what is the information before it; and I'm satisfied that for whatever reason a valid majority of employees have approved the agreement. I'm also satisfied that the nature of the agreement is within the compass of 170LI.

PN142

In the circumstances, there is a valid application before the Commission, and it is a matter for consideration as to whether or not it should be certified. The parties to the agreement as I've noted are Wenco and its employees. The application of the agreement may be discerned in effect from clause 2 which is headed Parties Bound An Application Of The Agreement. I find that the agreement applies in relation to the single business of Wenco at its factory located at 1 Ladner Street, O'Connor in respect of the business of rolling and pressing steel in the metal and engineering industry, and in relation to employees who are subject to the provisions of the Metal Trades General Award 1966 excluding salaried employees engaged as a supervisor or in a managerial capacity.

PN143

The agreement was approved on 16 July and lodged on 28 July. It is not out of the time and accordingly it may be effectively processed. As I have noted, the exhibit Wenco 1 is the 170LK notice; that is in satisfactory form. The predominant questions that arise upon certification of the agreement appear to me to be confined effectively as issues. The question of whether or not the no disadvantage test is satisfied. That test effectively is provided for in Section 170XA of the Act. It was put to me that the CCIWA and Wenco find some solace in the view that it is necessary just to have a look at the terms and conditions of the particular employees who happen to be those who subscribe to the agreement at or around the time it is made.

PN144

To quote the CCIWA submission:

PN145

The agreement was submitted on the basis that the terms and conditions prescribed by the agreement are the terms and conditions of employment prescribed by the award which are relevant to those employees to whom the agreement applies.

PN146

The relevance of the provisions as detailed in the attached statutory declaration. And in that statutory declaration, Mr Smith runs through a number of matters that he thinks are not relevant. For instance, that none of the employees work in hot areas or dusty areas or abattoirs or ever worked, so it is said, in the location allowance parts of Western Australia and the like. That percussion tools do not form part of the work carried out at Wenco so presumably there are no jobs of a dirty nature. Wenco does not engage electrical employees. There is no need for a leading hand allowance. I'm simply not in a position to assess what are the terms of the employees at the site.

PN147

However, I wish to make it clear that there is a complete misconception on the part of the CCIWA, or of Wenco, if it thinks that the requirements of Section 170XA are satisfied if someone simply has a look at what the employees are doing, and then has a stab at what are the terms and conditions that are currently operative. I know that is a view that is held by some. I am aware that it is a view that is sometimes applied to assist in the operation of the no disadvantage test. If you have a look at what are the actual hours, for instance, worked by some employees, to the extent that it is a view that is likely to be pressed, I recommend someone have a look at Section 170XA. It says:

PN148

An agreement passes the no disadvantage test if it does not disadvantage employees in relation to their terms and conditions of employment.

PN149

That is then described as terms and conditions of employees under relevant awards or designated awards and any law of the Commonwealth, State or Territory, in the instance of XA(2), that the applicant or the Commission considers relevant. The no disadvantage test for these employees, believe it or not, is to be assessed against the entirety of the conditions in the award, and the entirety of the conditions of employment that arise out of the State legislation. It is not a matter only of the 13 employees who happen to be employed today or yesterday at Wenco.

PN150

The agreement applies, as I have just indicated, to - the employees covered by it, namely, Wenco employees who but for the operation of the agreement would be engaged under the provisions of the Metal Trades General Award (1966). It applies, over the period of operation - three years. The no disadvantage test is to be applied by reference to the terms and conditions of employment of employees who are subject to this agreement - that is, both present and future. There should be no skerrick of thought on the part of any responsible adviser, that the Commission does not have an obligation to look at how the agreement might be used.

PN151

It appears to me to be almost dishonest to look at the circumstances of 10 employees and disregard the potential application of other conditions that might apply to them over the life of the agreement. For that reason - and I set my face very firmly against the notion - but let's just have a look at what are their existing contractual terms, and that's near enough, and that should satisfy the Commission. It certainly does not satisfy this member of the Commission. In many circumstances, I would ordinarily expect, if I thought there were matters that were suspicious, to be taken to what is the State legislation that may be brushed aside by an agreement of this kind where there is plainly a flight from the State Tribunal coverage to Federal jurisdiction.

PN152

The Commission is at a disadvantage in making that assessment. It normally doesn't know what are the occupational health and safety rules, for instance. It is not necessarily appraised of what are the long service leave conditions, and it frequently does not understand what is meant when there is a clause put into an agreement - and I notice that there is not in this one, from recollection - that says the State legislation no longer applies. Having said that, I consider the terms of this agreement are not of the kind, though, that should put any member of the Commission or the employment advocate, if it is an AWA, on notice that there is something highly suspect about the agreement that is proffered.

PN153

This agreement, in a rather general way, does seek to escape from the award, but it states that the intention of the parties is that the terms of the agreement will not disadvantage employers in an overall sense, when compared to the terms and conditions of employment prescribed in the Metal Trades General Award (1966). The agreement does not, as some often do, introduce an entirely new pattern of ordinary working time and spread of hours. This one maintains the Metal Trades conditions, as best I understand it, all the way up to clause 9. It seems to say that ordinary working hours for any day of the week are in clause 10. It salvages what it takes away by acknowledging that it will pay overtime for Saturday and Sunday work, which is more or less the standard in the Metals award.

PN154

The agreement lacks some of the other conditions that are important in such agreements that are the give away of an award-stripping exercise. I don't consider this is an agreement in the nature of an award-stripping exercise. I am reassured, to some extent, by the fact that Mr Edmonds, despite his difficulties in securing an agreement at the site on satisfactory terms, is driven to press in relation to the no disadvantage test, two points: the first is that the agreement is no better than the award; and the second is that in some respects, where it is worse than the award, it is in relation to the rights of union representation, recognition, and safeguards for Federal association considerations.

PN155

In other words, the AMWU, I think, is forced to damn with feint praise the benefits that employees secured for three years by this agreement, but the AMWU is not in a position to come out and say that, in substance, viewed overall, the terms and conditions of the relevant employees that may be covered, are substantially reduced in overall terms and conditions. If it were in the position to do that, then it would have to, in my view, make a better job of it than it has been able to do in this instance, specifically in relation to entitlements that are likely to be of critical importance to the employees.

PN156

Mr Edmonds has pointed to - I think, to maternity leave. That is countered by Mr Moss, who has gone to an appendix to the agreement which is intended to pick up parental leave of various forms. In addition, the Commission has raised with Mr Moss a set of specific concerns about the content of the agreement in terms of the no disadvantage test. Pre-evident among those was the fact that clause 4 in the passage I have not yet quoted, appears to displace the award and any other award which may otherwise apply, but for the operation of the agreement.

PN157

In response to matters that have been raised, I understand that Wenco is prepared to give an undertaking to the effect that notwithstanding clause 4.2 of the award - sorry, of the agreement - this agreement shall operate on the basis that it will be read in conjunction with the Metal Trades General Award (1966), provided that where there is an inconsistency between the agreement and the award, the agreement shall prevail. To that undertaking, as I understand it, there is a supplementary undertaking. It picks up a concern I have, that at clause 12, the provision as to rate of pay reads:

PN158

An employee's ordinary rate of pay shall be the rate of pay specified in the employee's contract of employment or letter of appointment. This rate shall form the base rate of pay for the calculation of the employer's entitlement to paid leave, superannuation and overtime.

PN159

12.2 then says:

PN160

Notwithstanding sub-clause 12.1, an employee shall not be paid less than the rate of pay specified in schedule A.

PN161

And so far as relevant, schedule A then refers to classifications C14 through to C5, stipulating what those minimum rates of pay - effective at 5 June 2003 - what I understand to be precisely the existing rates as at that date for the Metal Trades State Award, particularly at level C. It determines a tradesperson's - an hourly rate of $14.27 and a weekly rate of $542.20.

PN162

Lest my concern about that provision in conjunction be misunderstood, clause 12 is a provision that, in my view, goes to the operation of the no disadvantage test. It goes also in a subsidiary way to the enforcement of the agreement. As the provision stands almost no one, short of substantial extrinsic evidence being adduced, could know or prove what is the pay entitlement of anybody under the agreement. Effectively clause 12.2 says, well, have a look at the employee's contract of employment or their letter of appointment, which is a matter that might be worked out later.

PN163

No employee, unless they happen to have their letter of appointment or contract of employment, would be able to tell anybody what was their existing rate of pay. It's no answer to say, well, they could have a look at their pay slip. If the matter does arise for enforcement in two or three years then a Court might want to know why the Commission thought that the no disadvantage test could be satisfied by something so slipshod, although in fairness schedule A does specify a minimum rate of pay. In this instance there are no increases attached to those minimum rates of pay so probably the agreement suffices to specify a minimum rate of pay.

PN164

But in the absence of an obligation to actually classify people in accordance with the minimum rate of pay, which is part of the award provision, schedule A would be nearly as meaningless as clause 12. It is for that reason that I welcome what I take to be a willingness to enter into an undertaking. It is subsidiary to the undertaking that I require and which I understand is forthcoming in relation to the operation of clause 4.2.

PN165

It is to the effect that further, notwithstanding the provisions of clause 4.2, clause 12 and schedule A, the agreement will operate on the basis that the classification arrangements provided for in the award apply in respect to the classification of work subject to the minimum rates of pay as provided for in schedule A of the agreement and on a basis that as at the date of certification of the agreement Wenco acknowledges that the agreement will operate in a way that ensures that a person entitled to classification at C10 is on a benchmark rate of, at least, $16 per hour; at classification level C11 at least $15.50 per hour and at classification level C12 at least $14 per hour.

PN166

I realise that that undertaking isn't in precisely the terms that Mr Moss advantaged but I do not understand from the way in which he put his submissions that it does more than reflect what is the employer's existing practice. The rates are in line with the award. The classification structure, as I understand it, is intended to be in line with the award. All that the undertaking that I seek does is say that, "We will apply the award classification structure. In effect, we have, and these are the rates that we observe above the award classification structure".

PN167

In relation to the point raised as to the correspondence between the provision as to casual employment, which is fairly minimal, and the award provision as to casual, I accept the submission made by Mr Moss which cites the Full Bench of the WA AIRC in Metals Engineering Workers Union v Century Industries (1996) 76 WARG 1287 in which it explained the provision to which I was referring. I note that there is no arrangement to cover special rates in the agreement and the observation made about the absence of a need for a leading hand entitlement. I note also that it is said that there is no provision for shift work on a continuous nature or the entitlements under it.

PN168

I am conscious that there is a curtailment of some rights of payment in relation to sporadic shift work, particularly for overtime where it occasionally arises. Having regard to the general undertaking given and to the nature of the employment I do not consider that those items are sufficient in themselves to warrant a conclusion on my part that the no disadvantage test is not satisfied in respect of them. I do not consider that the application of that test requires the Commission to strain to find points of disadvantage. One looks at an overall reduction in conditions and in this instance I accept that for the most part those conditions have no work to do.

PN169

On the other hand, there is an undertaking that the award will continue to be respected and if there is a need the oversight or non-inclusion of particular conditions may be examined against the undertaking that has been given. Employees themselves have some obligation to raise those sorts of points and I'm not satisfied that the employer will fail to have regard to them if the need arises. The points raised by Mr Edmonds effectively went to an array of matters that placed the union at a disadvantage, it is said, in maintaining a presence in the workplace and particularly ensuring compliance with the agreement and industrial representation of employees.

PN170

I have not studied with detail some of the points that Mr Edmonds has made. For instance, he put the proposition that the union is not in a position to have any form of entry to the premises to inspect time and wages books. I do not understand the position to be certainly that there is no continuing obligation on the employer to maintain time and wages books. The Act and the Regulations, as I understand it, stipulate that that must be done. If there is no right of entry where the union is not party to an agreement that is not a matter that I have checked in detail in the legislation. That does not preclude the union in a proper case seeking to have the power of the Commission, which undoubtedly continues to exist, applied to have the matters verified.

PN171

I don't suggest that that is the best option but if there are legitimate grievances being raised it may well be over to the employer to allow reasonable representation rather than to become a test case or being brought before the general Commission which may now be an opportunity to deal with, if not vexatious litigation, the vexation of a union unable to represent its members because there has been a movement from the State jurisdiction to the Federal area.

PN172

I should not be taken to be belittling or minimising the significance of the loss of those entitlements to the AMWU if loss it be. Some of them may be recognised in relation to the continued acceptance of the award so far as it speaks about some of those entitlements. That may be a matter that can be pursued at a later stage. On the other hand, I do not consider any of the entitlements as listed in the context of this agreement as in itself sufficient reason to treat Section 170XA as leading me to conclude that there has been an overall reduction in terms and conditions of employment of a kind that would not satisfy me as to the no disadvantage test.

PN173

In reaching that conclusion, nor should I be taken to in any sense be influenced or persuaded by the references to I think at least one decision, that of Commissioner Grainger, stating a view about what is or is not pertinent to the relations of employers or employees. I am aware that there is a variety of views, some of them very recently expressed about such questions. For my own part, I have yet to form a view and when I do so it will be hopefully after there has been adequate argument covering a quite extensive history that starts before 1996 in relation to what matters about the enforcement of terms and conditions provided for, and industrial instruments may or may not pertain to the relations of employers and employees or be acceptable as part of an agreement.

PN174

In this instance, what is clear is that there is no agreement between the employer and the employees about the carrying over of some conditions of that kind out of the award. That is a consideration of some substance where there is an agreement either between employees as party and their employer or a union and the employer as party. The considerations appear to me to be of some difference. Here I am concerned only with the question of whether or not the no disadvantage test is breached because of the lack of provisions about noticeboards, right of entry and related aspects of freedom of association. I do not consider in the circumstances of this case that the no disadvantage test is breached.

PN175

It follows that I'm satisfied that the agreement so far as the no disadvantage test is made is in conformity with the requirement of the Act and rules. In relation to the question of Section 170LW, I note that there is a qualified condition and reference to enable the Commission to deal with a matter referred including, if necessary it is said, by arbitration. I will treat that as an intended empowerment subject to conditions. To the extent that it is an intended empowerment, then under Section 170LW I approve it.

PN176

In all the circumstances, I consider that the agreement is made in sufficient compliance with the Act and the rules for it to be certified. My satisfaction on that count is reached following a perusal of the statutory declaration and the terms of the agreement. The substance of that perusal is set out in a checklist compiled by my associate, and completed and signed by me following my reading of the agreement and, of course, the hearing of the parties that has been conducted to this proceeding.

PN177

In the circumstances I certify this agreement, 826650. The agreement made it will come into operation from 12 September 2003 and remain in force for a period expiring 11 September 2006. A copy of the decision that has been delivered ex tempore will be made available in due course. A copy of the agreement as certified will be provided to the applicant as soon as practicable.

PN178

In relation to the completion of the process, I will make that certification subject to a condition. The condition is that on behalf of Wenco, Mr Moss confirm that the undertaking that I have sought under Section 170LV in the terms that I have proposed is acceptable to the company. I have to some extent free-wheeled in the way in which I have paraphrased what fell from Mr Moss on his instructions from the company, but I don't think that I have strained or stretched beyond what was intended in the wording that I have put, but I will give you an opportunity to look at that wording.

PN179

I'm not so much inviting you to come back to me, but I would seek your confirmation so that it is put in writing lest there be any challenge between us, and if there is some area of difference, then for on my part I will have to reserve the question of whether or not the agreement has been certified if, for instance, there is a major departure when it comes down to looking at the terms of how I have expressed the undertaking as I would require it and as I understand it has been offered. All done?

PN180

MR MOSS: Yes, thank you, sir.

PN181

HIS HONOUR: The Commission will adjourn.

ADJOURNED INDEFINITELY [4.16pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #WENCO 2 LETTER DATED 15/08/2003 PN82
EXHIBIT #WENCO 3 WENCO SUBMISSIONS PN83
EXHIBIT #WENCO 4 STATUTORY DECLARATION OF PHILLIP SMITH PN84
EXHIBIT #AMWU 1 SUBMISSION BY AFMEPKIU PN85