AG2002/6352, Transcript of Proceedings [2003] AIRCTrans 55 (7 January 2003)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 4, 60-70 Elizabeth St SYDNEY NSW 2000
DX1344 Sydney Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT DUNCAN

AG2002/6352

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LK of the Act
by Western District Health Fund Limited re
certified agreement 2002

SYDNEY

9.12 AM, TUESDAY, 17 DECEMBER 2002

PN1

THE SENIOR DEPUTY PRESIDENT: Could I have appearances please?

PN2

MR DOUGLAS: I seek leave to appear for the applicant.

PN3

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Douglas.

PN4

MR TAMPLIN: Your Honour, I seek to intervene on of the Australian Services Union.

PN5

THE SENIOR DEPUTY PRESIDENT: Very well, Mr Tamplin. A fairly unusual situation, the leave matter for appearances I think is simply in the hands of the Commission.

PN6

MR DOUGLAS: Yes, it certainly is, your Honour, yes.

PN7

THE SENIOR DEPUTY PRESIDENT: So I grant you leave.

PN8

MR DOUGLAS: Thank you.

PN9

THE SENIOR DEPUTY PRESIDENT: We will deal with the application for intervention.

PN10

MR DOUGLAS: Yes. Your Honour, I'm not sure under which part of section 43 my friend would seek leave to intervene. Maybe he should inform the Commission and then I can deal with it as appropriate.

PN11

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Tamplin?

PN12

MR TAMPLIN: Your Honour, it is my understanding that there had been discussions between our National office in Melbourne and Mr Serong who is the legal representative for the company and it was our understanding that - sorry, I will go back. We have sent a letter to the Commission yesterday afternoon and the company have received a copy in relation to our concerns in relation to appearing before the Commission in this matter, that we have employees of this company who are members of the union. We are seeking a right to be heard and we are also seeking to be party to this agreement, your Honour.

PN13

THE SENIOR DEPUTY PRESIDENT: To be bound by the agreement?

PN14

MR TAMPLIN: To be bound by the agreement, yes.

PN15

THE SENIOR DEPUTY PRESIDENT: Yes.

PN16

MR TAMPLIN: If you are talking about S43, we are saying that because we have got members of the union in this company, and I think that if you look at the correspondence your Honour that went to both yourself and to the company, that we have - the company recognise the union by having payroll, also that we can supply to the Commission at a later date a copy of an authorisation from a employee of the company who is also a member of the union.

PN17

THE SENIOR DEPUTY PRESIDENT: Yes, all right, Mr Tamplin. I think what Mr Tamplin has said probably should be read in conjunction with the letter of 14 November 2002. Do you have a copy of that, Mr Douglas?

PN18

MR DOUGLAS: Yes, I do, your Honour.

PN19

THE SENIOR DEPUTY PRESIDENT: Also the letter to the Commission of 16 December 2002, I think both of those contain grounds.

PN20

MR DOUGLAS: Yes, your Honour. If my friend is saying, your Honour, that the union has given notice that it wishes to be bound by the agreement we accept that notice has been given.

PN21

THE SENIOR DEPUTY PRESIDENT: To both the company and the Commission.

PN22

MR DOUGLAS: And the Commission and if he is saying that an employee of the fund who is a member of the union has requested the union, that the union take that action, if he is saying that to the Commission, then I accept that, your Honour. On that basis, I don't have any difficulty with intervention being granted to the union in accordance with section 43(2)(b). As your Honour is aware, intervention on that basis means that my friend, any submissions that he might make, are confined to the issue as to whether the union is to be bound or not.

PN23

He has no right to go to merit and that is a decision of Senior Deputy President Polites' which you aware of that is supportive of that proposition. If my friend is seeking also to intervene pursuant to section 43(2)(a), then your Honour, we would object to that and ask that the union formally provide evidence (a), to the effect that it was requested by a member before the agreement was made to meet and confer with the employer about the agreement. Now, the correspondence, your Honour, does not support a position that will allow the union to intervene under section 43(2)(a) at this stage.

PN24

Your Honour, what happened was we received the letter of 14 November and in that letter the union said:

PN25

Our union has written and verbal requests from members employed by Westfund requesting an opportunity to meet and confer about the agreement as per section 170LK(4).

PN26

Then they refer to LK(5):

PN27

Once requested to represent the employees whose employment will be subject to the agreement, a reasonably opportunity to meet and confer.

PN28

Now, there are two issues that arise from that, your Honour. One is, was there an appropriate request by a member to the union in accordance with LK(4) before the agreement was made. The statutory declaration shows that the LK(2) notice was in the hands of the employees, the 48 employees, on 24 October, that they were given 20 clear days to consider the terms of proposed agreement, that the vote occurred on 13 November the day before this letter. In fact, a valid majority emerged on that day and therefore the agreement was actually made on 13 November.

PN29

That proposition, your Honour, is supported by two decisions. I think the decision that your Honour was involved in, in Magnet Mart Proprietary Limited and the decision in Murvac Hotels. So the union's letter on 14 November was too late to activate LK(5) because the agreement was made and those decisions, I think the one your Honour was involved in is good for the proposition that any rights arising under LK(5) cease to exist the moment the agreement is made.

PN30

THE SENIOR DEPUTY PRESIDENT: Well, Murvac said the - - -

PN31

MR DOUGLAS: That is Murvac, I'm sorry, yes, not Magnet Mart. Magnet Mart is authority for the proposition that once the valid majority emerges, then the agreement is deemed to be made. Well, that occurred on 13 November. Now, if my friend is able to establish that a member prior to 13 November actually requested the union in accordance with LK(4) but for whatever reason the union didn't act on that until after the agreement was made, then that would still be sufficient to allow the union to intervene, as I understand the law under section 43(2)(a).

PN32

Now, your Honour, I don't wish to make a capital case out of this. I have no difficulty in dealing with the issues, the merit issues that are in the attachment to the union's letter of yesterday to you. It is a matter of common sense, I'm prepared to deal with those anyway. I do take the point in relation to section 43(2)(a).

PN33

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Tamplin, I have to deal with two situations. In point of time the first is that there is nothing prohibiting my granting leave to the intervention if, pursuant to 43(2)(b) you are seeking to be bound. That is the ASU is seeking to be bound. However, that leave on the basis of the decision of Senior Deputy President Polites which was, I suppose one might say favourably commented on by a Full Bench in the ALHMWU v Murvac. The intervention goes to whether or not the union should be bound only.

PN34

MR TAMPLIN: Commissioner, can I just raise there. Basically that is what we want, is to be bound by the agreement at this stage.

PN35

THE SENIOR DEPUTY PRESIDENT: Yes.

PN36

MR TAMPLIN: Just to be bound by the agreement.

PN37

THE SENIOR DEPUTY PRESIDENT: If that is your position, I can grant you leave to intervene.

PN38

MR TAMPLIN: Yes.

PN39

THE SENIOR DEPUTY PRESIDENT: But it follows because I happen to agree with Mr Douglas that the intervention is restricted to whether or not your should be bound.

PN40

MR TAMPLIN: Yes, I agree, right.

PN41

THE SENIOR DEPUTY PRESIDENT: All right then. I grant leave to intervene.

PN42

MR TAMPLIN: Thank you.

PN43

MR DOUGLAS: Thank you, your Honour, on that basis I will deal with the application and in going I will deal with the merit points in my friend's letter in the attachment.

PN44

THE SENIOR DEPUTY PRESIDENT: Yes. I note that you have said that and I should perhaps put it on the record that I think the course you are adopting is most appropriate because however the Commission becomes aware of comments or challengers to the merits, the Commission can hardly ignore them.

PN45

MR DOUGLAS: Of course, your Honour, of course. Your Honour, there are 48 employees involved. There were 48 employees involved at the time of vote on 13 November. 43 voted. 27 voted in favour of making the agreement, 16 voted against the making of the agreement. In that group of 28, your Honour, there are 39 full-time employees and 9 part-time employees, no casuals. On the no casuals issue, your Honour, automatically deals with a couple of points raised by my friend in that letter but I will deal with those also on the basis - on the presumption there are casuals but in fact there are not at this time and, of course, this is the critical time as far as the no disadvantage test is concerned.

PN46

Your Honour, could I deal with a machinery matter first and hand up to you a certificate of registration on a change of name. During the process the company, your Honour, and for many years, had the name of Western District Health Fund Limited. On the day after the application was filed, the application was filed on 5 December, the day after the application was filed, the name of the company was changed to West Fund Limited. The entity remains the same, your Honour, and I simply point to section 111(1)(p) and that would allow you to make the appropriate amendment to the documentation. I go directly to the matters - - -

PN47

THE SENIOR DEPUTY PRESIDENT: Just before you do I will mark that document, I think, so that it can be recorded.

EXHIBIT #WESTFUND1 CERTIFICATE OF REGISTRATION AND CHANGE OF NAME

PN48

MR DOUGLAS: Does your Honour have a copy of the award?

PN49

THE SENIOR DEPUTY PRESIDENT: I don't think I do.

PN50

MR DOUGLAS: I can hand up a copy of the award and the up to date rates and those two documents in combination - it is the award in simplified form. It is relevant that I should provide your Honour with a copy of the 1999 LK agreement, your Honour, because that is relevant in relation to the no disadvantage test.

PN51

THE SENIOR DEPUTY PRESIDENT: Very well.

PN52

MR DOUGLAS: This agreement, your Honour, is in a sense a roll over of that 1999 agreement which, of course, was certified by the Commission having passed the no disadvantage test. The award being the same on each occasion, except the date of the award. I think the award on the occasion of the 1999 agreement was referred to as the 1994 award, it is now 2001 award and it has been simplified. In broad terms, your Honour, the no disadvantage test was the same in '99 as it is now subject to increases in award wage rates by reason of safety net adjustments.

PN53

Could I refer your Honour to the statutory declaration and to the various provisions in the Act in section 170LK. Section 170LK(2) was complied with and I refer to the attachment at the back of the statutory declaration of Elizabeth Barnes which is the notice, the formal notice, of the employer's intention to make an LK agreement dated 23 October. As I said earlier, your Honour, this notice was in the hands of the employees on 24 October.

PN54

THE SENIOR DEPUTY PRESIDENT: Which attachment is that?

PN55

MR DOUGLAS: I presume it is attached to - it is attachment B, your Honour.

PN56

THE SENIOR DEPUTY PRESIDENT: B, yes.

PN57

MR DOUGLAS: B, I am sorry, to the declaration.

PN58

THE SENIOR DEPUTY PRESIDENT: Yes.

PN59

MR DOUGLAS: The notice complied with the requirements of section 170LK(2) and in particular, if you note, in the third last paragraph it reads:

PN60

If you are a member of the union it is entitled to represent your industrial interests in relation to work that is subject to the agreement you may request the union to represent you in meeting and conferring with the fund about the proposed agreement.

PN61

Next I submit that section 170LK(3) was complied with. The employer took reasonable steps to ensure the employees had ready access to the proposed agreement and in particular I refer to paragraph 5.7 on page 7 of the declaration which refers back to paragraph 5.1 and 5.1 details the steps that were taken in relation to the - communicating the proposed agreement to the employees. You will notice that there, at 5.1, the information there has five paragraphs:

PN62

...that on or before 24 October each employee who may be affected by the agreement was given a copy of the draft agreement, comparison document and a letter from the CEO advising of the intention to make the agreement.

PN63

The documents were also put on the Intranet system so all staff could print them off and this is recorded on our Intranet system as being received:

PN64

I rang all branch staff on Thursday, 24 October to ensure they received their documents on the Intranet and by post. I advised them also to read the documents carefully and this was their time for consultation. If they had any questions or issues that we were able to assist them.

PN65

Then Ms Barnes refers to the fact she received a number of telephone calls and emails with queries from staff about the proposed agreement:

PN66

I answered each of those. Also in this capacity I am required to make regular contact with all workplaces and in the course of doing so I would raise the matter of the proposed certified agreement and answer any queries that were put to me.

PN67

Then there was refer to branch manager's meeting:

PN68

I reinforced that this was their agreement and if they had any issues of if they wanted union representative it was available to them.

PN69

Then at paragraph 4, a ballot took place on 13 November. Your Honour, I submit that LK(4) was complied with and that is seen from the notice that I've already referred to. No request was made of the union - by the union in accordance with LK(5) prior to the making of the agreement and I don't need to go to that in any greater detail than I already have. Section 170LK(6) is not relevant in the current circumstances. Section 170LK(7), the employer took reasonable steps to ensure that the terms of the proposed agreement were explained to the employees and I refer to paragraph 5.11 on page 8 of the declaration.

PN70

Section 170LK(8) is not relevant in the current circumstances. 170LT(6) was complied with. A valid majority of the employees voted in favour of making of the agreement and I've given your Honour the numbers and that is referred to in the declaration. LT(7) was complied with and I refer to paragraph 5.10 and 5.1. LT(8) was complied with. The agreement contains an appropriate disputes settlement procedure. LT(9) is not relevant for current circumstances. LT(10) was complied with, the nominal life of the agreement is to be for 3 years and in my submission the agreement passes the no disadvantage test.

PN71

There are - that issue, your Honour, is dealt with in paragraphs 6.3 and following in the declaration on pages 8 through to 11. You will see there are three reductions, dealing with hours of work, overtime and jury service and a number of improvements which we say, on balance, result in there being no reduction in the overall terms and conditions of employment. Could I take your Honour to the agreement and ask your Honour also to open follow the '99 agreement and the clause numbers are pretty much the same.

PN72

You will see that by and large there is very little difference between the agreement currently before your Honour for certification and what was certified back in 1999. If you turn to the first page of the agreement in each case, this agreement and the '99 agreement, you will see the award reference is the same. That is the relevant award for the no disadvantage test was the same in both cases. The agreement is for 3 years, that is set out in clause 2.

PN73

I go to casual employment in point 4 on page 3 of the agreement, your Honour, the current agreement and the corresponding provision which is 4.2 in the '99 agreement, on page 3 of that agreement. You will see that the provision with respect to casuals is the same now as it was in 1999. The hourly wage rate is based on a 35 hour week with a 20 per cent loading and that was so on the previous occasion and hours of work and overtime provisions apply to casuals then as now.

PN74

Then if you go over the page, in both agreements, you come to hours of work. You will see the hours work provisions are the same for full-timers, in both cases, 5.1 in the '99 agreement and 5.1 in the current agreement, ordinary hours or any hours after 6 am on any day, Monday to Saturday. 15.2 the ordinary hours at 35 hours per week then and now. 5.3 and this deals with one of the criticisms in the attachment which my friend has.

PN75

I refer to paragraph 2, hours of work, clause 5.1 ordinary hours, any hours after 6 am Monday to Saturday is open for abuse for an overtime payment of time and a half for the first three hours and double time thereafter. Award clause 23.1.1 has been removed after 6.30 pm Monday to Friday and after 12.30 pm on Saturday. Such a provision is contrary to the public interest for the purposes of 170LT(3). Well, your Honour, the provision in '99 read 5.3:

PN76

Actual time and days when you work will be set by the fund.

PN77

The provision is the same today in the current agreement, however, ordinary hours are normally worked from 9.00 am to 5.00 pm Monday to Friday with a one hour meal break. Now there is no change in that provision, your Honour, and the Commission obviously had no difficulty with certifying the agreement in '99 containing that provision and in my submission the same should apply here.

PN78

You then go to overtime which is in 4.6 of both agreements. More than 10 hours after 6.00 am and you will notice in the current paragraph, the overtime rate is time and a half for the first two hours and double time thereafter. The provision was exactly the same in the '99 agreement.

PN79

Then over the page: Work on Public Holidays. This is a matter referred to in item 3 of my friend's attachment. Payment for public holidays 47.7. This appears to remove a double time and a half loading award clause 23.2.1. Well, in fact, that is not so. This provision is the same as the provision that existed that was certified in '99 and it refers to all work. It certainly says in '99 and now, if you work on a public holiday you get double time and a half. So that is if you work overtime or ordinary time on a public holiday you get double time and a half.

PN80

So there is no issue with respect to public holidays. Then if you go over the page to 6.7 and presuming that there were casuals employed today which there are not, 6.7 in the '99 agreement says if you were a casual you would be paid overtime after 10 hours work on any day, you will not be paid a 20 per cent loading when working overtime and the loading will not be included in calculating the overtime payment.

PN81

Your overtime will be calculated on your minimum rate of pay specified in clause 8. The provision in the current agreement before your Honour is exactly the same. So the issues raised by my friend in paragraph 1 of his attachment with respect to casuals, your Honour, just doesn't hold water and particularly so when I come to look at long service leave because in paragraph 1 at the end he says:

PN82

Long service leave available to long term casuals under the New South Wales ...(reads)... and redundancy for regular casuals.

PN83

The presumption being is that that entitlement is lost and that is not so. In both agreements there was a grading structure and there as criticism of grading structure in paragraph 4. I am sorry, in paragraph 6, classification structure schedule A. It remains unclear why this provision is necessary and to the extent it reduces proper description of each classification as per the award. It potentially devaluates the integrity of the award structure.

PN84

PN85

There is no guarantee that employees will not be disadvantaged in terms of the existing award classification. Well, the simple fact is, your Honour, that in the '99 agreement there was a 5 grade structure very similar to the one in the current agreement. That structure was then designed to meet the needs of this particular enterprise. The structure in the current agreement is now a six grade structure and again, your Honour, it is a structure that is designed to meet the needs of this particular enterprise.

PN86

There is no issue with respect to the structure which could cause problems as far as the no disadvantage test is concerned. I then go over the page - - - '

PN87

THE SENIOR DEPUTY PRESIDENT: There is probably nothing in this but classifications have been reversed have they not?

PN88

MR DOUGLAS: Yes, the numbers have been reversed, your Honour.

PN89

THE SENIOR DEPUTY PRESIDENT: But nothing hangs on it.

PN90

MR DOUGLAS: No, nothing hangs on that. That is simply a different approach to the grading structure and there are six grades instead of 5.

PN91

THE SENIOR DEPUTY PRESIDENT: Yes, I take that point.

PN92

MR DOUGLAS: Yes, the numbering is simply a change in numbering, your Honour. Then over the page, in paragraph 4 of my friend's attachment, he says, wage increase clause 8.3 the annual wage review is purely discretionary and there is no guarantee of any wage increase as a result of the review. In the 1999 agreement in clause 9 there was a provision that dealt with performance based bonuses.

PN93

In 8.2 a clause that dealt with salary reviews. The provision in 8.3 is identical to the provision - is of the same effect or like effect to the provision that was in 8.2 in the 1990 agreement as to salary review occurring each year and as to bonuses, the provision with respect to bonuses in the '99 agreement is continued in this agreement and I refer in particular to 9.2 in the '99 agreement as to the bonus pool and 9.2 in the current agreement as to the bonus pool.

PN94

I advise your Honour that all employees this year, for example, received an increase in accordance with that provision. Every employee received a bonus from that distribution. 9.3 deals with the calculation of the bonus payments and the provision is the same as in 9.3 of the previous agreement and you will see in that clause, your Honour, an entitlement to up to three additional days holidays as described in clause 20 and that is three additional days of annual leave.

PN95

So that is a significant plus in terms of comparison with the award. I then go to clause 23 on page 20 of the current agreement and to clause 23 of the 1999 agreement which is on page 18 of that document and you will see long service leave is dealt with today as it was in 1999 and it reads:

PN96

You shall be granted long service leave in accordance ...(reads)... in which you are employed.

PN97

On that basis, your Honour, I would submit that there is no substance in the comment in paragraph 1 of the union's attachment with respect to casuals being - long term casuals being denied their long service leave rights in accordance with New South Wales Long Service Leave Legislation. In fact the clause in the agreement protects those rights. Finally, your Honour, the disputes clause and I raise this not because it has been flagged by the union in the attachment simply because it may have raised an issue in your Honour's mind.

PN98

That is, in clause dispute settlement procedures, clause 27 in the current agreement and was in clause 27 of the 1990 agreement and I direct your Honour's attention to 27.4 of the previous agreement and 27.4 of the current agreement. The provision is exactly the same and it says:

PN99

If the matter is still not resolved either you or the fund can ask the Australian Industrial Relations Commission ...(reads)... resolution of the matter by conciliation.

PN100

Now some members of the Commission ask the question or concern themselves as to whether the employees were given sufficient information to fully understand the nature of the provision of that kind. Well, I simply say, your Honour, the provision of that kind has ben in operation now for at least three years because of the 1999 agreement but in fact was in operation prior to that in an enterprise flexibility agreement.

PN101

So on that basis, your Honour, I will submit that you should not be concerned that the employees would not understand that conciliation was the limit to which the issue could go.

PN102

THE SENIOR DEPUTY PRESIDENT: Which is the point of the query of course.

PN103

MR DOUGLAS: Yes, your Honour. Now on the basis of those matters, your Honour, I submit that this agreement should be certified by the Commission.

PN104

THE SENIOR DEPUTY PRESIDENT: Very well, thank you, Mr Douglas. Mr Tamplin.

PN105

MR TAMPLIN: Your Honour, first of all, the advocate for the employer has been referring to the previous agreement to the test of the no disadvantage test. The test must be based on the award and not on the previous agreement for a start.

PN106

THE SENIOR DEPUTY PRESIDENT: Yes.

PN107

MR TAMPLIN: Secondly, in relation to the 170LT(2) in relation to the no disadvantage and I will just take you through our concerns in relation to those points.

PN108

THE SENIOR DEPUTY PRESIDENT: I am not sure that the intervention you were granted goes that far.

PN109

MR TAMPLIN: Right, okay.

PN110

MR DOUGLAS: I have really done the work for him your Honour.

PN111

THE SENIOR DEPUTY PRESIDENT: Yes, okay.

PN112

MR DOUGLAS: He has faired better than he should have.

PN113

THE SENIOR DEPUTY PRESIDENT: The ASU does seek to be bound does it not?

PN114

MR TAMPLIN: Yes, we actually wish to be bound by the agreement, yes.

PN115

THE SENIOR DEPUTY PRESIDENT: Yes.

PN116

MR DOUGLAS: We have no objection.

PN117

THE SENIOR DEPUTY PRESIDENT: Yes, I appreciate that.

PN118

MR TAMPLIN: Right, then.

PN119

THE SENIOR DEPUTY PRESIDENT: What I intend to do is to indicate that I will certify the agreement. I will bind the ASU to the agreement in accordance with the provisions of the Act and I will publish my reasons in due course. That will not hold up the certification. One point, Mr Douglas. As currently advised, I think I shouldn't tamper with the title of the agreement.

PN120

MR DOUGLAS: Yes, your Honour. Yes, I think that because it is not a substantive issue - - -

PN121

THE SENIOR DEPUTY PRESIDENT: It is probably not covered under one of the - - -

PN122

MR DOUGLAS: - - - and you can change the name of the agreement, yes.

PN123

THE SENIOR DEPUTY PRESIDENT: I see, you want me to change it.

PN124

MR DOUGLAS: Yes, your Honour, so it becomes - - -

PN125

THE SENIOR DEPUTY PRESIDENT: The West Fund Limited.

PN126

MR DOUGLAS: Yes, yes.

PN127

THE SENIOR DEPUTY PRESIDENT: All right. I shall do that. I adjourn this matter indefinitely.

ADJOURNED INDEFINITELY

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #WESTFUND1 CERTIFICATE OF REGISTRATION AND CHANGE OF NAME PN48