C2003/755, Transcript of Proceedings [2003] AIRCTrans 819 (12 March 2003)

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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER RAFFAELLI

C 755 of 2003

APPLICATION FOR CERTIFICATION OF AGREEMENT

Application under Section 170LW the Act
by NUW and Qantas Airways Limited re engagement of temporary employees

SYDNEY

10.06 AM, FRIDAY, 21 FEBRUARY 2003

PN1

THE COMMISSIONER: Could I please have appearances?

PN2

MR P. RICHARDSON: I appear for the National Union of Workers with MR CAIN, MR GESSON and MR COLLINGS.

PN3

THE COMMISSIONER: Yes, thank you.

PN4

MR J. McKENZIE: I appear for Qantas Flight Catering Limited. I have with me MR BLAKER, MR HARDY and MS SCADET from the company.

PN5

THE COMMISSIONER: Thank you. Yes, Mr Richardson?

PN6

MR RICHARDSON: Thank you, Commissioner. Commissioner, at the outset I can apology for the minor delay in proceedings. Unfortunately the flight was late. Sir, this concerns a notice pursuant to the dispute settlement procedure of the National Union of Workers and Qantas Airways Limited Enterprise Agreement number 6 and relates primarily to a range of issues associated with the engagement by the company of some 28 or so employees who in our opening submissions we would describe as non permanent employees. I acknowledge that in the notice as filed with the registry reference was made to temporary employees but upon the engage of further material in the form of correspondence between the parties since the matter was first filed it has become clear to the union or perhaps unclear to the union that we are unsure as to the status of the employee central to this dispute.

PN7

Sir, by way of background the union seeks to draw the Commission's attention to several provisions within the current certified agreement and also draw to the Commission's attention some announcements that were made by the company in the later part of 2002. Specifically, I would draw the Commission's attention to clauses 9 and 10 of the current certified agreement which make provisions for the engagement over and above full time employment in the form of either casual employment or temporary employment. The union acknowledges that at any point in time subject to the provisions of those clauses the company could be engaged in both casual and temporary employment.

PN8

However, there are some distinctions beyond the traditional notions of casual and temporary employment. Specifically unless otherwise agreed at a local level a casual employee is only to be engaged day by day and in any event for a period of no more than four weeks.

PN9

At clause 9.5:

PN10

A casual employees is one that can be engaged pursuant to a formal agreement reached between the parties and filed with the Industrial Relations Commission.

PN11

In contrast a temporary employee is an employee that may be engaged for a period of up to 52 weeks and receives the benefit of the same terms and conditions of employment that would apply to equivalent full time employee. In other words sir we submit that ordinarily a temporary employee would not receive a casual loading in lieu of leave arrangements and other obligations of entitlements that might arise under the agreement and underpinning award.

PN12

Furthermore, there is a distinction between the introduction of casual and temporary employment insofar as clause 9 makes clear in our opening submission that casual employees may only be engaged with the specific agreement of the parties whereas temporary employees may be engaged after appropriate consultation. In other words there is no explicit right for the union or for that matter the company to require a formal agreement in order to engage temporary employees.

PN13

Towards the end of last year and after a considerable period of time, I think some five or six months, the company made a series of announcements to all employees engaged at the catering operation here in Sydney and also to each of the unions with a membership interest at the Catering Centre. Those announcements related to the outcome of a study commissioned by the company in the earlier part of 2002 that has generally been referred to as the MMR, of middle management review. Without going to the entire detail of that review it contained a number of proposals that the company intended, and in fact is in the process of implementing, that in these proceedings we say - or at least at this stage in proceedings we say could be reduced to the following points. That there would be a number of redundancies and that those redundancies would be at both a non award or managerial level, and I use that term loosely, as well as amongst the higher levels or higher classification levels within each of the agreements including this agreement. That as a consequence of those redundancies there would be a restructure of the company business and that the business would adopt more of a supply chain approach to its operation and that as a consequence a considerable number of new positions would be created.

PN14

Employees regardless of whether they were covered by a certified agreement or not were to be advised of those changes and that occurred and would be presented essentially with three options as to how they wished to respond to those changes. Those employees could opt for or express an interest in redundancy. Alternatively, they could express an interest to be redeployed, or that is to apply and if successful be redeployed into the new positions that would be created or they could express an interest to be redeployed elsewhere within Qantas generally. That process commenced in the latter part, I think about mid December of 2002, and concurrent with that process there was dialogue between each of the unions individually and collectively over the proposed job descriptions or classification descriptions for the new restructured positions.

PN15

Approximately two weeks ago the union was advised by the company that in terms of the 35 or so employees that are members of its that were immediately or directly affected by the change some 12 had been accepted for redundancies. In other words 12 employees had indicated a willingness to be retrenched and the company had accepted that. That still leaves questions that the union has raised as to the status of the other employees and also the union has previously corresponded with the company over the proposed new descriptions for those employees but is unable to identify any response.

PN16

Now, I don't suggest for a minute that the summary of the middle management review there is entire or comprehensive but I think by way of background it goes to the salient points. If I could just repeat what they are in different words, they are that the business is undergoing change, that change impacts upon the existing classifications and the existing staff mix, not only amongst the NUWs membership but amongst that of other unions with an interest at QFCL.

PN17

One additional point that I seek to make is that as part of the announcements in relation to middle management review the company indicated that it would also be converting some 65 non-permanent positions to permanent positions. So whilst there would be an overall reduction in the number of employees there would be some engagement or employment of new permanent employees.

PN18

Against that background the company sought from the NUW to introduce 10 temporary employees into the business and in correspondence to the union on 13 January of last year the company specifically indicated that it wished to engage 14 fixed term temporary store persons within their Sydney operations and relied upon in part what they indicated were difficulties that the business was experienced due to high and unplanned levels of absence but also that those temporary positions would be filled as temporary positions pending a conclusion of the relevant aspects of the middle management review.

PN19

That correspondence, and towards the end I will simply tender a copy of this, if you consent, that correspondence was forwarded to myself and to Mr Derrick Belan, the branch secretary, on both 8 and 13 January. There was no prior consultation or discussion between the union and the company about the engagement of temporary employees.

PN20

In other words we say that the company was acting in a manner inconsistent with the provisions of clause 10.4 of the certified agreement. Upon raising that issue with the company as well as a range of other issues the company agreed not to engage the temporary employees for a short period of time so that it can consider its position further and also made available a facility for the union and the company to discuss the matters in the form of a telephone conference.

PN21

That telephone conference occurred and at the conclusion of that conference the union was invited to present to the company an alternative to the engagement of 10 temporary employees and by means of correspondence on or about 17 January the union put forward a proposal to the company which would have provided consent to the engagement of temporary employees as proposed by the business, subject to a number of qualifications. In these proceedings at this stage I would describe those qualifications as being a commitment at the end of their engagement to the creation of permanent positions that those persons were filling.

PN22

That proposition was rejected by the company and the company proceeded effective from 20 January to engage the 14 temporary employees as proposed. Subsequent to that there were some discussions between some of the delegates of the union and the likely management around the issues, which failed to resolve matters, and on 28 January the company corresponded on a second occasion to both the national office and the branch of the union, indicating that it intended to engage a further 10 temporary employees.

PN23

On this occasion the company relied upon again its observation that there was an escalating level of unplanned absence and also an unfounded allegation that the employees were engaging in a go slow in the workplace. Importantly though on this occasion there was no prior consultation, nor no subsequent consultation with the union as contemplated in clause 10.4. In fact it was somewhat of a surprise to both tiers of the union office that the company's correspondence was received indicating that a further 10 temporary employees would be engaged.

PN24

Here though things get perhaps more complex and go to some of the real issues, and at this stage I'd seek to tender a copy of a bundle of correspondence which I've alluded to thus far.

PN25

THE COMMISSIONER: I'll mark that?

PN26

MR RICHARDSON: Yes please.

PN27

THE COMMISSIONER: All one document?

PN28

MR RICHARDSON: Yes please.

PN29

THE COMMISSIONER: Yes. Exhibit NUW1.

EXHIBIT #NUW1 BUNDLE OF CORRESPONDENCE

PN30

MR RICHARDSON: Now, Commissioner, exhibit NUW1 is copies of various parts of the correspondence that in our submission detail, or provide detail in support of our submissions thus far. The part of the exhibit that I wish to take you to specifically is the last piece of correspondence, which is the last two pages of the exhibit. And that is the letter of 28 January that I've just indicated was received foreshadowing an intention to engage a further 10 temporary employees.

PN31

If I could take you specifically to the last of those two pages and initially if I could paraphrase, the company having foreshadowed its intention to engage a further 10 temporary employees provides some indication that it believes that the work that the temporary employees would be engaged in is not work that could normally be performed by the existing work-force and that it would be the intention that those persons would be engaged initially for three months and that it would be reviewed at the end of three months or if service levels are restored to a normal level prior to that. And we say that that is, or we acknowledge that that is the company meeting part of its obligation under 10.4 but the timing of the correspondence and the tone of the correspondence did not afford any real consultation on the part of the union.

PN32

Significantly though in our submission the letter goes on to say, and I quote from the third paragraph:

PN33

This approach is in accordance with the provisions of the local site agreement ...(reads)... Sydney Catering Centre.

PN34

And the current enterprise agreement at clause 9.5 makes reference to casual arrangements:

PN35

The union will not unreasonably withhold agreement to amendments sought ...(reads)... the casual arrangements.

PN36

And I end the quote there. Now, the reference to the local site agreement is a reference to an agreement entered into by the parties in February 1999 governing the use of casual employees at the catering centre, and I'd seek to tender a copy of that agreement.

PN37

THE COMMISSIONER: I will mark that Exhibit NUW2.

EXHIBIT #NUW2 AGREEMENT ENTERED INTO IN FEBRUARY 1999 GOVERNING USE OF CASUAL EMPLOYEES AT SYDNEY CATERING CENTRE

PN38

MR RICHARDSON: Now sir, in our submission Exhibit NUW2, in these proceedings at least, is a local agreement that is contemplated under clause 9.2 of the certified agreement. I make the observation that it is not an agreement that is recorded in accordance with clause 9, but that's not an issue that we take exception to in these proceedings. Put another way, there is an obligation to have any casual agreements filed with the Commission, and they are recorded in the appendix. This is not such an agreement.

PN39

Nonetheless Exhibit NUW2 is an agreement that both parties have relied upon in the past to govern the engagement of casual employees, and specifically we say it provides that casual employees are only to be engaged in particular forms of work and in particular areas as described at clause 2; that only five casual employees are to be engaged on any one day, except in circumstances that are described as exceptional where after or by agreement the number may exceed five. Then in addition casual employees are to be part of a pool of labour as contemplated under clause point 9.

PN40

Our point is the company says to us in correspondence that it is engaging temporary employees but at least in respect to the second group of temporary employees relies in part at least upon the casual employment agreement and that is why I prefaced our opening comments by saying the reference is to non-permanent employees.

PN41

Subsequent inquiries by the union disclose a number of matters that we say are matters of fact. Firstly, all 28 employees are being paid a rate of pay that is approximately $19.60. That is to say they are receiving a rate of pay that taking into account minor errors in rounding off is equivalent to what a level 2 store worker would receive if they were engaged as a casual employee. Further, all 28 employees are engaged by means of a labour agency, I understand that to be Forstaff, whereas the past custom and practice has been and in fact has been recorded and agreed as being, that temporary employees are directly engaged by Qantas.

PN42

Thirdly, none of the employees as of today has been issued with a security clearance which is something that is ordinarily a pre-requisite to work within the premises with the employer, nor have any of the employees undergone a health or medical examination which is a requirement particular to the operation of the catering centre. We would say the reasons for that would be largely self-evident.

PN43

The company says it is engaging temporary employees: in fact it is engaging casual employees and as such we say that it is engaging these persons in a manner that is not provided for under the current certified agreement nor under the local agreement albeit that its status is questionable, that has been tendered as exhibit NUW2. We say that because the employees are being engaged in a manner inconsistent with the local agreement, they are being engaged for a period in excess of four weeks as provided for at clause 9.3, they are being engaged without the agreement of the local delegates as contemplated in exhibit NUW2.

PN44

Whilst they are receiving a casual loading there is some question as to their employment status and the terms and conditions that they are receiving and furthermore whilst it is open for the company to say that the union should not unreasonably withhold its amendment to any existing casual agreement there has been no action or foreshadowed action on the company to give effect to the provisions at clause 9.5.

PN45

In the alternative, if the company continues to say that the employees are engaged as temporary employees we strongly assert that in respect of the second group of employees there has been no consultation as proposed and contemplated under clause 10.4 of the certified agreement but more importantly if these employees are temporary employees they are not being engaged in a manner consistent with clause 10.3 of the agreement which reads, and I quote in part:

PN46

Temporary employees will be employed under the same terms and conditions of employment as equivalent full-time employees.

PN47

Again, these persons are not being engaged by Qantas and are therefore not receiving benefits that they otherwise would receive if they were employees of Qantas.

PN48

I won't deny that there are a range of other issues that I am fairly confident Mr McKenzie will seek to raise or allude to and those matters require some discussion. However, in our submission, at this stage they should be discussed in conference but clearly from our perspective the company is engaging in an exercise of increasing the workforce considerably in terms of the number of non-permanent employees. It is doing that on the face of the evidence in a manner that is not provided for under the certified agreement and as such we say is in breach of the agreement and I will return to that aspect shortly but furthermore, is engaging these persons in a way that is contrary to what the company says and undoubtedly will say negatively impacting upon the full-time permanent workforce.

PN49

In that respect I refer back to the background, albeit briefly, that was provided in respect of the Middle Management Review, that is to say that we have a company which is saying we need to remove layers of staff, we need to re-structure the business and we need to re-structure some of the jobs within the business but at the same time introducing what represents approximately some 25 to 30 per cent of the NUWs membership interest in the form of non-permanent engagement.

PN50

The union office has endeavoured to engage in discussion with Qantas, it is apparent that their view is that they are acting within their managerial rights and also, although we say mistakenly, within the rights afforded to them under the industrial instruments and as such dialogue achieves nothing. In large part that is why we have filed this notice.

PN51

In concluding I indicated that it is our view having regard to the material before you that Qantas is acting in breach of the agreement, that is obviously not a light assertion to make. However, we would draw the Commission's attention to the provisions of the dispute settlement procedure in this agreement and specifically the second paragraph of clause 4 of the agreement which, after having referred to the dispute settlement procedure commits the parties if necessary to the Commission ultimately having the capacity to resolve disputes.

PN52

In other words we say that should matters remain unresolved either today or subsequently then the parties have empowered this Tribunal to ultimately determine the matters in dispute between them notwithstanding other sections of the Act and decisions in relation to section 170LW. At this stage, subject of course to what Mr McKenzie has to say, we seek an adjournment into conference in an endeavour to move towards a resolution on some, if not all, of the matters before us. If the Commission pleases.

PN53

THE COMMISSIONER: Thank you, Mr Richardson. Yes, Mr McKenzie?

PN54

MR McKENZIE: Commissioner, at the outset I might say that the NUW have, in our assessment, not included a number of key facts in relation to this particular matter and I will come to those. In essence there are three things which are causing QFCL in Sydney major concern and hence the introduction of the temporary employees and I will go through the process which has been entered into in relation to the discussion but they would be the excessive absenteeism at QFCL which - and I will provide figures on this - at least in the last two weeks by way of example has been running at over ten per cent which is probably around 200 hours.

PN55

The other point is that employees are not working as directed in accordance with the award and I will provide some examples of that. And there are as a result of the labour shortages which is the third point, the company's inability to meet its service requirements to its customers who are not only Qantas but also overseas airlines and for example what QFCL does in essence is provide a service where it packs bars for both domestic and international airlines, also dry stores which go into flights and also medical supplies, water and so on. They essentially for the last few months or at least prior to January have not been met on a number of occasions, almost on a daily basis we would say essentially because of labour shortages.

PN56

The NUW are saying in essence that the company has not consulted adequately in relation to the introduction of temporaries. These matters we say were raised with delegates at least from September in relation to addressing the labour shortage and there was considerable delay in bringing in two casuals to complete what was a one month project to conduct an assessment of the existing store stock for Qantas. And there was considerable difficulty in just bringing in two casuals to do that work and that process took several weeks to just bring in those two casuals.

PN57

The issue we say in relation to bringing in these temporary employees is as a result of a business requirement. That is that there is a requirement to do this work. It is certainly linked with the high levels of absenteeism and the work practices at QFCL Sydney. We brought on those temporary employees to meet those requirements.

PN58

Mr Richardson, if I may, alluded to the restructure in QFCL Sydney. The restructure in QFCL Sydney in broad terms will mean that there will be 169 redundancies. There are in stores 12 level 4 positions which were removed which will be reduced as a result of an expression of interest in redundancy. QFCL, just by way of background, initially sought in one particular area in level 4, the NUW and the delegates requested that all level 4 positions be opened up and that request was agreed to. So, all the level 4 positions in terms of the expressions of interest have been met. There also will be a reduction of five level 5 positions which are the highest level of leading hand in the store.

PN59

Now, Commissioner, if I could take you in particular to the correspondence which is NUW1. The discussion which I mentioned concerning the two casuals is outlined on 29 October. That is essentially to cover off this one month activity in the store involving Qantas. On 8 January, which is the second page of NUW1, the stores manager Mr Blaker wrote to the delegate ostensibly advising that we were looking at filling four vacancies. There were, as a result of attrition, four stores vacancies. The company proposed, obviously because of the issues around service difficulty, to advertise and fill those positions.

PN60

What was proposed by the delegates was that the company not fill those positions until the outcome of the middle management review or the restructure, which also impacted stores, was clear. So the company agreed to that and then proposed that there be four storemen be brought on on a temporary basis. So that is in the fourth paragraph of that letter. Also, Mr Blaker highlighted to Mr Gesson, the delegate, that there was a continuing high level of absences. In his letter Mr Blaker refers to five per day in the last four months. And in the week of 8 January that was up to seven per day. So, Mr Gesson was advised that there would be 10 temporary employees engaged for a period during the transitional phase of the middle management review to cover for the unplanned absences.

PN61

Now in terms of the intentions Mr Blaker also wrote to Derrick Belan who is the branch secretary of the NUW, copied in Mr Richardson from the federal office as well as Mr Gesson the delegate and Steve Cain who was the local organiser. And I can provide copies of that. I seek to tender that.

PN62

THE COMMISSIONER: This will be exhibit QF1.

EXHIBIT #QF1 LETTER FROM MR BLAKER TO MR BELAN

PN63

MR McKENZIE: Commissioner, in relation to the advice there was an intention to engage the four temporary stores persons. The period of engagement, in the second paragraph, was from 13 January. That was sent to cover the vacancies - you can see there in the second paragraph - until the middle management review was finalised. That approach it was recognised in that letter would minimise any impact of redundancies. In other words, for example, staff at level 5 who were being made redundant could be redeployed to those currently vacant positions.

PN64

In relation to the third paragraph, we say that there was no impact on overtime which is one of the underlying issues, we would submit, in relation to this whole particular issue. We are saying that the overtime has been capped at 16 hours per employee, per week, which equates in Mr Blaker's letter to 40 per cent of additional hours above the normal working week for an employee. Also for OH&S reasons there is no more than 12 hours a days to enable an employee to have a 10 hour break between shifts.

PN65

In relation to the further correspondence to the union, Commissioner. Mr Blaker wrote to the National Union of Workers on 13 January. That is the third page of exhibit NUW1. The second paragraph confirms that:

PN66

There are 14 fixed-term temporary employees to be engaged for an initial period of three months at level 2 of the NUW classification structure.

PN67

And then the third paragraph:

PN68

The aim of the engagement is to provide cover for the inordinately high levels of unplanned absences in the business which have been averaging five days in the last four months.

PN69

So there is, in a sense, 10 plus the four vacancies. The paragraph down the bottom, Commissioner, was - if I can take you to the last paragraph:

PN70

The other alternative in resolving this situation would be to temporarily increase the number of casuals engaged in the business beyond five per day.

PN71

But that has never been agreed with the union or the delegates. We say that there is a certain resistance to increase the casual numbers in the business. So I will deal with that particular issue shortly. The advise from Mr Blaker is that the engagement wouldn't impact on full-time employment and it is more cost-effective than covering employees for overtime.

PN72

The company requested in the last paragraph of that letter that the NUW would provide a reply to those proposals by 17 January. And Mr Richardson's response is outlined in the fourth from the fifth page of exhibit NUW1. Which is essentially the NUW was of the view that those positions should become permanent. There is a commitment from the QFCL I should say that those positions should become permanent and essentially seeking a response from the company on that.

PN73

The reply from Mr Blaker is also outlined in exhibit NUW1 which is essentially - in the third paragraph of the letter from Mr Blaker:

PN74

That the need for temporary employment is based on the current levels of absenteeism. The company will manage its labour requirements consistent with a reduction of these absenteeism levels.

PN75

And Mr Blaker advises in his letter that the company does intend to review the staffing levels:

PN76

We will make the necessary adjustments as soon as possible to review the developing opportunities for ...(reads)... to fill the four current permanent vacancies as soon as possible.

PN77

So QFCL are not saying that they won't fill these positions permanently. What they are saying is that they will need to go through an appropriate process and assessment of those positions. And considering the three points I have raised, Commissioner, there are very valid concerns about whether that process will in fact be fruitful, in the short-term at least. And I will come to that shortly. Mr Gesson, the NUW delegate, wrote to Mr Blaker on 22 January and I seek to tender that.

PN78

THE COMMISSIONER: I will mark this exhibit QF2.

EXHIBIT #QF2

PN79

MR McKENZIE: The request for Mr Gesson is essentially the same as the request for Mr Richardson, which is that there be a recognition by the company that there be 19 full time positions to be automatically offered to the staff. Of course, this letter has been written prior to advice to the union that the expression of interest positions have been filled, which I will come to shortly. Essentially that's the position. Mr Gesson has also attempted to consult with the company and negotiate that outcome.

PN80

What happened was following the appointment of these 14 temporary employees, there was, in a sense, a campaign by a number of employees at QFCL in the stores to go slow. That correspondence is actually covered off an exhibit NUW1 which is the last item of correspondence. If I can take you to that, which is a letter from Mr Blaker to Mr Richardson. In the second paragraph Mr Blaker says:

PN81

In addition to the escalating levels of unplanned absence there is a go slow.

PN82

Mr Blaker outlined in his letter there was a meeting of the delegates with the company on 21 January and that was essentially confirmed in that meeting. As a result of that confirmation that there was a go slow there was obviously concern from QFCL and Malaysian to that, which is in a sense industrial action, and because of the continuing service difficulties the company advised in that letter that there will be a further 10 temporary employees to be employed. They would commence on 29 January and they would be engaged at level 2. You will see there in the third last paragraph from Mr Blaker:

PN83

The aim of the engagement is to provide labour to cover the performance shortfalls ...(reads)... unplanned absence currently being experienced in the business.

PN84

I know we're not in a situation where we are actually in evidence yet, Commissioner, but that, if necessary, can be given. We say that unequivocally there was a go slow and that was admitted to by the delegates. In terms of the other parts of the letter, we say that Mr Blaker also points out the recent service shortfalls:

PN85

The work cannot be reasonably and economically done with the existing workforce. Employees will be engaged for a period of three months as temporary employees.

PN86

SO it's quite clear from the correspondence, despite Mr Richardson's assertions, that these employees were to be engaged as temporary employees. If I can also refer you back to correspondence which is in NUW1 dated 21 January from Mr Blaker where Mr Blaker advises the delegates that there will be 14 temporary employees engaged, in point 1 of that letter, as an interim solution to facilitate. You will notice in point 2:

PN87

To facilitate bringing service levels up to schedule a further input of temporary staff would occur today until the normal service levels are reached.

PN88

Certainly intent from Mr Blaker's advice to the delegates that apart from the 14 full time temps there would be additional employees because of concern about commitments to service levels. Point 4:

PN89

Management will review with the delegates the productivity levels on a daily basis to ensure that schedules continue to be met.

PN90

Commissioner, in relation to one of the concerns of the NUW about the redundancies at level 4, Mr Skinner, who is the general manager, catering, New South Wales, in a sense the manager of the centre of catering in Sydney, wrote to Mr Richardson on 5 February and I seek to tender that.

PN91

THE COMMISSIONER: This will be exhibit QF3.

EXHIBIT #QF3 LETTER FROM MR SKINNER, GENERAL MANAGER, CATERING, NSW, TO MR RICHARDSON DATED 5/02/2003

PN92

MR McKENZIE: Commissioner, the second paragraph basically outlines:

PN93

QFCL has received the required numbers of expressions of interest in redundancy for the level 4 positions.

PN94

That meant there were no forced redundancies at level 4:

PN95

However, it's been explained to all of the remaining employees at level 4 that they will be required to work and move around as directed.

PN96

In other words, they will be able to perform all the duties at level 4:

PN97

If necessary there will be a development assessment required of all employees to assist them undertaking the tasks and functions.

PN98

The stated position is if employees are going to stay, then they will have to work in accordance with the award. I seek to tender the relevant provision which I am referring to. If I could take you to clause 14.1 which is an extract from the Airline Operations Qantas Airways Limited Award 1999 and clause 14.1 provides that:

PN99

Employees must undertake duties as directed within their limits of their skill, competence and training which will include cross-utilisation and working down as directed.

PN100

Then it talks about specific issues concerning engineering and maintenance which refer to mechanical and avionics skill abilities. That we say is not being adhered to at QFCL Sydney on a daily basis. The employees would be regularly asked, in particular at higher levels, 3 and 4, and I have to say that level 4 is the first level of leading hand, but we would say that that is not being adhered to or complied with. The request to move around is obviously for an operational reason, where there is a shortfall of labour, to cover somebody who is absent, for example, or whether there is a requirement to meet a peak in operations.

PN101

Commissioner, in earlier meetings which we have had with the union it's been raised that employees haven't had the relevant training to do so. That is one assertion which we say, based on our assessment in the last probably eight weeks, is not correct. I have examples here where supervisors have requested employees to move around and the refusal has not been substantiated by anything other than, in most cases, that they don't want to. I can provide those to you.

PN102

MR RICHARDSON: Commissioner, I object to Mr McKenzie tendering those. I think we both at this stage are making assertions at various levels. Mr McKenzie did have cause to speak with me earlier this week as to what my expectations were in terms of today's proceedings and I indicated the setting of a number of matters on the record and then into conference. He did ask in the context of how prepared he needed to be. I think if he intends to rely upon material that persons who are not here today have put together, then that shouldn't occur because I think at the appropriate time if necessary the union should be able to cross-examine on that.

PN103

I think we wouldn't take exception to the assertions he is making but I think to tender the material shouldn't occur. I would also counsel against it being tendered, given that we are in public proceedings at the moment. It would apparent, even though Mr McKenzie hasn't concluded his submissions, that there is a lot of feeling at the centre and I think if there was material provided that had individual's names on it, it might exacerbate matters without any apportionment as to who was right or wrong in these proceedings. If the Commission pleases.

PN104

MR McKENZIE: Commissioner, I am happy not to tender this. I can take you to essentially what are the main points of this and Mr Richardson does make a valid point. If this part of the submissions need to go to evidence then we will bring that because it is clear to us that employees are refusing to work as directed.

PN105

If I can take the Commission to a couple of days - going back, these are examples, Commissioner - going back to 26 December there were nine requests from the supervisor to move and three of those were agreed to. The other six were not. We would say only one of those refusals was as a result of concern about having inadequate training. The others were a simple refusal.

PN106

Concerning another day on 29 December one employee was logged as being requested to move and agreed. That's another example. On 1 January one employee was requested, logged as requested to move and agreed. On 17 January as another example there were eight requests by supervisors that were logged and three of those agreed. There's nothing, no reason given that's reported that refers to concern about inadequate training; simply that one comment as sections just as important.

PN107

In relation to another day - I'm sorry the day before - it's just out of sequence here, the day before there were four requests to move and four refusals based on the simple refusal to go to another section. Commissioner, knowing that this hearing was on and as Mr Richardson has eluded to perhaps a feeling on this particular issue, there has been logged or recorded two requests to move on Tuesday of this week, and two refusals. A simple refusal, one comment was that I will move only if I get overtime.

PN108

So you may recall, Commissioner, improved proceedings in this Commission in relation to a similar matter absent it was our assertion that employees will only move if they are paid overtime. That is I think, we can deal with this in confidence, but I think there is in part a recognition from the delegates in relation to that.

PN109

I can give you perhaps some background in relation to the unplanned absence.

PN110

THE COMMISSIONER: This will be exhibit QF5.

EXHIBIT #QF5 AS ABOVE

PN111

MR McKENZIE: Commissioner, this is just a quick summary for your information that would assist you, we would believe, in relation to the absence. you can see there is, it goes back to mid year. It's certainly the higher level which takes you up well above 250 hours figure and there is perhaps, this is only to mid January but we would say that since that time it's - there was a slight decrease you could see in the Christmas week for obvious reasons where employees are paid penalty rates to work on the public holidays. But we would say that it was a spike coming back up since then.

PN112

So the actual man, actual unplanned absence is the graphs there so that you could that some weeks are well and truly in excess of others but certainly a trend or a patten there which is very worrying and from the company's point of view cannot plan, makes it very difficult for this level of absenteeism to actually provide a service and hence the ongoing advice to the employees about the unplanned absence and the position which is taken in relation to the engagement of the temporary employees.

PN113

Commissioner, if I may get to the substance of what the NUW was saying in relation to the breach of the agreement. Commissioner, we would say that the employees have clearly been employed as temporary employees. It is specifically stated in the letters to the union that they will be temporary employees. The reasons for their engagement are clearly stated and I might say consistently stated. Commissioner, the three concerns we have which relate to the refusal to work as directed, the excessive absenteeism, and the meeting of service levels, we believe are the reasons for putting on these temporary employees, firstly the 14 and then the additional 10.

PN114

Commissioner, if the situation is that the absenteeism comes down to acceptable levels and employees work as directed, and the service requirements are met, then perhaps the numbers can be reviewed. But we say that in relation to the temporary employment provisions of the certified agreement, we've met those. And certainly there are valid reasons as to why we have put on these temporary employees.

PN115

Now, there is, there will be required to be a review of the labour mix once we implement and finalise the middle management review and we will have to review the labour, in other words look at what the true level of permanent employees should be, and the company doesn't walk away from that. Also Commissioner, we would say to you that we would want to look at part time employment and I omitted to say that in relation to the casuals, the 5 casuals, it was proposed early in January that the company employs 7 part time employees to replace casuals, and that was simply knocked back by the union delegates.

PN116

So Commissioner, the company is prepared to look at its labour mix but I must say this, that it will be on the basis that there is employees that are working as directed. The levels of absenteeism are to a point that the company can properly substantiate what its true labour requirements are. It would also look at covering peaks with looking at part time employees.

PN117

The other thing the company intends to do, and I put the union on notice, Commissioner, is that we will start to discipline employees from next week for refusing to work and move around as directed. The company has got to that stage; it doesn't take that lightly. That's where the company has got to in trying to cover off its requirements.

PN118

I'll leave it at that, Commissioner. We are prepared to discuss these matters in conference.

PN119

THE COMMISSIONER: Yes, Mr Richardson?

PN120

MR RICHARDSON: Commissioner, I'd just seek to respond to a couple of points and I'll endeavour to be as brief as possible and I'd repeat what I said when I interjected to Mr McKenzie tendering a document and that was that it would be apparent that there is more than that is on the record.

PN121

Sir, Mr McKenzie continues to say these persons are temporary employees. That's notwithstanding the fact that the letter in respect of the second round refers to the casual agreement, and the assertion of the union - although I indicate that we do have evidence in support of the employees being paid a casual rate and treated accordingly.

PN122

We come here in respect of understanding exactly how these employees are engaged. Now, in respect of his assertion that they are temporary, there is an acknowledgment that the company has certain rights in respect of what might trigger temporary engagement and they include the examples referred to by Mr McKenzie that I would broadly describe as the absenteeism and the service levels. But they are not engaged as temporary employees; they are engaged as casual employees.

PN123

Much could be said about why absenteeism is high. I think that either much of that is a matter of public record or in the public domain. It is true that we have been before you I think some three or four times in the last 12 months or so over several matters of ongoing concern but at the end of the day, and it's interesting that Mr McKenzie finally says that the company will act as an employer and invoke disciplinary proceedings; the company does appear to tolerate a large part of this behaviour and that in turn replicates the difficulties that it faces.

PN124

We take exception to one point, though, and not necessarily ultimately to the evidence that he draws and that is the alleged go slow. Mr Cain addressed the meeting of employees on 30 January after Mr Nels of the company contacted me seeking to ascertain whether a go slow was in place or not and Mr Cain clearly indicated to the employees that they shouldn't engage in any action that could be construed as repudiating their contract or, more importantly, industrial action.

PN125

The facts are, sir, that people are annoyed, people are frustrated, in large part because of the engagement of this non permanent workforce but also the continuing change that they face. The middle management review is the third initiative by Qantas in approximately 18 months as to the catering centre. Initially it was to be sold; secondly, it was to be subject to a competitive tender. Now it has a middle management review. On a regular basis the business changes its mind about what it wishes to have to be done.

PN126

THE COMMISSIONER: But all of those changes have been to the employees' benefit, hasn't it? You can't complain that they've moved away from selling the business to - - -

PN127

MR RICHARDSON: Yes and no, sir. I don't want to debate the merit of that but I think it would go as a matter of public record or at least would go uncontested by Qantas and I accept that there is a degree of job security and benefit that would go with remaining part of Qantas but the NUW was the only union initially that had no position on the sale and then had a position of not opposing it and that was reflective of its membership's views at the time.

PN128

The point though is that it just regularly changes. Yes, it is better to be part of Qantas with the benefits that are part of that but when one is regularly facing these changes and the external pressures that are placed upon the business as well which, unfortunately, are largely beyond Qantas' control, it does lead to a very low level of morale and frustration which I think does manifest itself in some of the behaviour that Mr McKenzie refers to.

PN129

But at the end of the day the specific - at least this specific issue before us is the status of these employees and once that's established what that status might be in the future. I think the union is on the record in these proceedings and I think more importantly in correspondence forwarded to all members on 12 February last year and if my memory serves me correctly a copy was also provided to Mr McKenzie at the time as a matter of courtesy.

PN130

The union is on the record as drawing to the attention of the employees their obligations under the award and clause 14.1 in particular which Mr McKenzie has referred to and which I would describe as the multi skilling or the cross skilling provision but is also on the record as indicating that the company does has certain rights but with those rights go obligations.

PN131

Now, in respect of these proceedings the company certainly has sought to exercise some of its rights but we say has done so wrongly having regard to the agreement and the other issues are issues of merit but certainly an agreement of this Commission should be held and should be upheld by all concerned. If the Commission pleases.

PN132

THE COMMISSIONER: Yes, thank you. We will adjourn into conference.

OFF THE RECORD [10.42am]

NO FURTHER PROCEEDINGS RECORDED

RESUMES [12.28pm]

PN133

THE COMMISSIONER: Thank you. The Commission has heard the submissions of the parties and in particular conferred with them and in that light the Commission sees as follows. Firstly the company has a right to have its employees work as directed in accordance with the contract of employment customer practice, the award and the agreement and if the employee fails to do so then the employer is entitled to undertake various disciplinary measures, noting of course that that is to be carried out in a fair way and getting the employees' side of the story.

PN134

Secondly, the company has a right to be concerned as to the level of absenteeism at QFCL. However, that is a complex issue and is not always easily solved and it cannot always easily be one where the company blames employees for why such levels are high. It is invariable that successful measures are ones that perhaps involve joint strategies. Furthermore low morale in the workplace may very well contribute to levels of absenteeism and therefore the overall matters that have been raised by both sides may perhaps be the ultimate solution to absenteeism if morale is in fact increased.

PN135

However, there might be some instances where a particular individual is consistently absent without reasonable cause and in that instance again the company has a right to undertake disciplinary measures provided as I said earlier in respect of the other matter that the employee concerned is treated fairly and consulted with.

PN136

Third, as to the use of temporaries which have become of concern to the union in recent times, it would seem that at the very least in my view the union does make some valid points and there needs to be some regularisation of the use of the particular temporaries utilised at the moment, in particular those employees utilised by Qantas in this position need to have appropriate security and health clearances which I understand is past practice at QFCL. Secondly, those employees must be paid appropriate wages and conditions. I don't take Qantas's use of these persons to be in order to get cheap labour but it is always important that concerns by employees are addressed when they are raised.

PN137

Finally I must say the use of temporaries and casuals or whatever cannot be the ultimate solution to the proper employment of appropriate numbers in a workplace such as this. It must be recognised that both the company and the union delegates and its members have knowledge which should be exchanged as to how the needs of the business can be fairly and efficiently met. The Commission is aware that with the MMR currently not complete a final and full picture of employment requirements is not possible at this stage yet I consider that much can be settled in the short term and with that in mind I consider that the company and union representatives should meet as soon as is practicable and certainly within two weeks from today so that the parties can exchange their views as to what they see as the proper manning, the proper grades for the work in a fair mix of full time and of other employment categories.

PN138

The Commission as well as all here present note of course that the workplace is one which has to deal with peaks both within the day and also peaks occasioned by events external to the workplace both by world and domestic events and that of course also impacts on the employment profile at a workplace such as this. I consider that any such meeting or meetings between the representatives be attended by union officers and union delegates and by responsible QFCL management. It would also be important that any such meetings be properly minuted so there is no disagreement or misunderstanding as to what the positions are when these meetings are held.

PN139

I propose to list a report back in this matter in about four weeks time and the appropriate time will be notified in due course. In the meantime also I should say that neither party should undertake acts which might prejudice the success of those discussions which I said I trust will commence in the next week or two. Until the next hearing I propose to now adjourn. Thank you.

ADJOURNED INDEFINITELY [12.37pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #NUW1 BUNDLE OF CORRESPONDENCE PN30
EXHIBIT #NUW2 AGREEMENT ENTERED INTO IN FEBRUARY 1999 GOVERNING USE OF CASUAL EMPLOYEES AT SYDNEY CATERING CENTRE PN38
EXHIBIT #QF1 LETTER FROM MR BLAKER TO MR BELAN PN63
EXHIBIT #QF2 PN79
EXHIBIT #QF3 LETTER FROM MR SKINNER, GENERAL MANAGER, CATERING, NSW, TO MR RICHARDSON DATED 5/02/2003 PN92
EXHIBIT #QF5 AS ABOVE PN111