C2002/286, Transcript of Proceedings [2003] AIRCTrans 96 (10 January 2003)

AUSCRIPT PTY LTD
ABN 76 082 664 220

Level 2, 16 St George's Tce, PERTH WA 6000
Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS

O/N WT05743
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER O'CONNOR

C2002/286

CBI CONSTRUCTORS PTY LTD and OTHERS

and

AUTOMOTIVE, FOOD, METALS, ENGINEERING,
PRINTING AND KINDRED INDUSTRIES UNION-
WESTERN AUSTRALIAN BRANCH

Notification under section 99 of the Act
of a dispute over the application of Clause
5(4)(ii)

PERTH

11.06 AM, THURSDAY, 19 DECEMBER 2002

PN1

MR P. COOKE: I appear on behalf of CBI Constructors Pty Ltd, United KG Pty Ltd, Monadelphous Engineering Associates Pty Ltd, Brambles Australia Ltd and Mamoot Australia Pty Ltd.

PN2

MR C. SAUNDERS: I appear on behalf of the AMWU.

PN3

THE COMMISSIONER: Right. Now, this is 111AA application in relation to the application of a clause in the agreement which relates to an allowance. Who goes? You go, Mr Cooke.

PN4

MR COOKE: Well, before we get to the point of who proceeds, sir, because at one level there is the union that are seeking to sort of make the claim, albeit we were the notifiers, that was the point I was to deal with later.

PN5

THE COMMISSIONER: Yes.

PN6

MR COOKE: At the moment the problem we have is that I am advised the work force of CBI Constructors this morning commenced strike action. The strike action, I am informed, pertains to an investigation that is proceeding, not concluded, into allegations that a Mr Warena, an employee of CBI, was abusive towards a security officer engaged by the Woodside Security Contractor. Anyway, a security officer employed by the Woodside Security Contractor.

PN7

That investigation has been ongoing since the start of the week. Nothing happened in relation to it yesterday because Mr Warena was not at work due to illness or sick leave. This morning I'm advised that the work force have gone on strike and the reason given, such as any reason was given, was that this investigation is going on involving Mr Warena, or the conduct of Mr Warena in relation to the security guard. The concern, sir, is that if the work force - if they were to return to work tomorrow, they have not succeeded, if that was their aim, in stopping or halting an investigation which is nothing more than an investigation at the moment, into Mr Warena's conduct.

PN8

So we are concerned that there is the likelihood of ongoing industrial action and we would seek to have the matter adjourned, sir, basically so that Mr Dodgson and myself can prepare a section 127 application as a matter of due haste, or with all due haste. We indicate for the record that Mr Davis, the official of the AFMEPKIU who is based in Port Hedland and often attends the site, was not on site when the industrial action occurred, so there is no suggestion in any sense that this is being instigated or at the instigation of the AFMEPKIU.

PN9

There is certainly no evidence to that extent, sir. But it is, given the nature of the issue that is allegedly causing the grievance to the work force, that isn't going to go away tomorrow. It will be ongoing tomorrow and we would seek to have the matter adjourned, as I say, so we can deal with more pressing issues.

PN10

MR SAUNDERS: Yes, sir. I was advised just prior to arriving here that the CBI work force has taken some industrial action over an investigation into an alleged incident between a worker and security officer. I'm advised that, through Mr Davis, that he was first notified not by the person who had the - who was being investigated but by another person yesterday. Mr Davis then notified CBI that he would be available at 1 o'clock this afternoon to assist in the investigation, even though that person who was being investigated still hadn't contacted him. It was agreed that that time would be set aside.

PN11

Mr Davis would make himself available for that investigation if the worker so required. Just after smoko this morning on site, Mr Davis was informed that the work force had left over the severity of the investigation, whatever that means. I'm also advised that - - -

PN12

THE COMMISSIONER: They have been beating them up, have they, in the interview room?

PN13

MR SAUNDERS: Must be. I'm also advised that there is a return to work without a meeting tomorrow morning. Sir, I would suggest that for me to stop and make a 127 application - but this matter has been notified and set aside for this time. The dispute itself is not over this application or the operation of that clause and we should be able to proceed with this and if Mr Cooke or whoever wants to go away and put paperwork in, so be it. As I said, my advice is they're returning tomorrow morning without a meeting, so - that may change, of course, but that is my advice.

PN14

THE COMMISSIONER: Mr Cooke, obviously even if we proceeded with the 127s today, they're not going to go back today. If they don't go back tomorrow morning, we can list your 127 at 10 am tomorrow morning and deal with it then. You have got all your witnesses here. I think it is probably much more practical to continue with this.

PN15

MR COOKE: The only issue of concern, sir, is that if Mr Saunders has confirmed the basis of the grievance that has allegedly caused these people to leave site, that is going to - the investigation is going to continue tomorrow. The employer is not going to be deflected from their action of investigating an incident by someone wanting to throw some industrial muscle around. And if that is the case, there is every likelihood that there will be further industrial action tomorrow, unless the employees alter their intent or their course of action.

PN16

THE COMMISSIONER: Well, their intent according to Mr Saunders is to go back to work tomorrow morning.

PN17

MR COOKE: Well, we certainly hope they do, sir, but as I said, there is every likelihood that when they discern that the investigation is continuing, that they may take further action.

PN18

THE COMMISSIONER: Well, hopefully with Mr Davis there today, it might smooth the way to resolving the matter and removing the grievances that the workers have.

PN19

MR COOKE: Well, the difficulty that the workers of course brought upon themselves is that Mr Davis will arrive there and they're not there, through no fault of Mr Davis, of course, but whether he will have an opportunity to communicate with the work force and advise them of what is likely to transpire in the event of a continuation of the matter is perhaps a moot point.

PN20

THE COMMISSIONER: I mean, it takes you two minutes to - I know very well that on your computer you have got your 127s there, you just press the button, because I have never seen them come out so fast from anyone but yourself and I'm sure that while you're here arguing this, somebody back at your office could be preparing it for you.

PN21

MR COOKE: Well, actually it is difficult because Mr Dodgson, the employee relations manager for CBI and the person who would normally instruct CCI in relation to any such action is of course sitting here as well. So it is - given that I'm tied up and Mr Dodgson is tied up, it does become difficult.

PN22

THE COMMISSIONER: It might resolve itself.

PN23

MR COOKE: No, it becomes difficult to instigate proceedings, sir. If one of us was indisposed, then the other could be doing something, but with both of us in the court, it does make it difficult to proceed. Mr Dodgson is the sole employee relations operative at CBI. He doesn't have an extensive staff to be carrying things forward in his absence. As I say, sir, the concern is - I mean, today is a lost cause. We appreciate that, but tomorrow if there is not a return to work or if there is strike action that occurs tomorrow, the situation gets more complex because the bulk of the work force will not be there next week obviously for Christmas and issues of payment for public holidays will arise if people go on strike on 20 December and don't return - don't make themselves known to their employer again until into the New Year. The employer will reasonably surmise they have been on strike for that period of time.

PN24

THE COMMISSIONER: They're due to go to work tomorrow, though?

PN25

MR COOKE: They are due to work tomorrow, sir. The bulk of the work force that are intending - and obviously, the great bulk of the work force don't intend to spend Christmas in Karratha.

PN26

THE COMMISSIONER: No.

PN27

MR COOKE: For reasonably apparent or obvious reasons, and those people are largely organised to not be at work from Saturday onwards. So our concern, sir, is if there isn't a full return to work in the morning, not only does the Warena investigation issue remain on foot and a potential source of grievance, but for those people - anyone that takes strike action tomorrow places in jeopardy at least 3 days public holiday payment and we end up with a further cause of grievances in the first week of the New Year.

PN28

MR SAUNDERS: Maybe I could assist? If we just spent 20 minutes - we could put Mr Dodgson in the witness box, give his evidence and he can carry on his business? As I say, this application goes beyond that of CBI.

PN29

THE COMMISSIONER: I appreciate that. Yes, that might be a solution, Mr Cooke. I mean, if they lose 3 days holiday pay, well, that is poetic justice, isn't it? They will learn to read the agreement or the award a bit better after that.

PN30

MR COOKE: Well, it might - on one level, sir, it would be more than poetic justice but it doesn't take a great degree of foresight to imagine that they won't be thinking how silly they were. They will rather be lashing out again at their employer for - because they have forfeited their payment and as I say, one can reasonably imagine - - -

PN31

THE COMMISSIONER: Is there anything in the agreement that says they - - -

PN32

MR COOKE: I beg your pardon?

PN33

THE COMMISSIONER: It displaces the award, doesn't it?

PN34

MR COOKE: It certainly does, sir, but to be eligible for the payment of common law, one has to be ready, willing and able to work. Someone who you last see walking out the gate, who tells you that they can't tell you when they're next going to be back at work, may have some difficulty getting up the argument that they were ready, willing and able to work. As far as the employer is concerned, they were on strike.

PN35

THE COMMISSIONER: Ready, willing and able to take the public holidays.

PN36

MR SAUNDERS: What I would suggest is that also the employer is paying the annual leave as of Monday, so obviously they're back on authorised paid leave, unless they withdraw that. That is an argument we will have after Christmas.

PN37

MR COOKE: Well, it is not the case that they would all be subject to annual leave. Some may not have accrued annual leave. Some may not be taking annual leave.

PN38

MR SAUNDERS: They will be on authorised leave, will they?

PN39

MR COOKE: I beg your pardon?

PN40

MR SAUNDERS: They will be on authorised leave?

PN41

MR COOKE: No. They are on strike. They are on strike. If they go on strike tomorrow, then they're on strike on Saturday and on Sunday and on Monday.

PN42

MR SAUNDERS: Is there anybody on authorised annual leave on Monday?

PN43

MR COOKE: Well, no.

PN44

MR SAUNDERS: No. Okay. If there is no one on annual leave, he has got an argument. If there are people on annual leave, he hasn't got an argument.

PN45

MR COOKE: Well, the fact of the matter is not everyone is leaving town. Some are due to work Monday, a small crew, a smaller part of the crew, but not the entire - but obviously some employees and the fact of the matter is, there is going to be a degree of debate. We are creating debate already over whether there is an entitlement. I don't think the work force will be similarly caught up in such an issue, sir.

PN46

THE COMMISSIONER: Yes. But I'm inclined to continue on with this matter. I mean, that suggestion of Mr Saunders, you put Mr Dodgson in the witness box and dispense with his evidence, he can be on the plane back up there this afternoon and it is obvious that he does a good job because it is only when he leaves town they go on strike.

PN47

MR COOKE: We wish, sir. Unfortunately they sometimes have the bad manners to go on strike even when Mr Dodgson is present. However, there is a need - the company is suffering loss as we speak. It is not a matter to be taken lightly. The issue has not gone away, the issue will re-occur tomorrow. With the employees return to work, the investigation which was proceeding or to proceed today will proceed tomorrow. It may appropriate to have Mr Dodgson give his evidence and then he can - I could organise for one of my colleagues to prepare the necessary paperwork and he can go back to our office and get that under way, because there is a concern, sir, that if they - it is bad enough we have lost today but to lose tomorrow as well just doubles the jeopardy that CBI finds themselves in.

PN48

Mr Dodgson makes the other correct point, sir, that before the bulk of the work force can leave site, the site has to be made safe. It is the cyclone season and if the bulk of the work force is not to be there over the Christmas/New Year break, large parts of the site need to be made secure in the unlikely or in the event that there was to be a cyclone pass through or near or in Karratha. That being the case, sir, it may be appropriate if we call Mr Dodgson to get his evidence out of the way and then Mr Dodgson is in a position to proceed.

PN49

MR SAUNDERS: I wonder if the other witnesses could leave the room whenever it is convenient?

PN50

THE COMMISSIONER: Yes, sure. Mr Knuckey and Mr Kelly, if you will wait outside. You will have to shut that door.

<MICHAEL JOHN DODGSON, SWORN [11.24am]

<EXAMINATION-IN-CHIEF BY MR COOKE

PN51

MR COOKE: Mr Dodgson, could you state for the record your full name and business address, please?---Michael John Dodgson, 220 St George's Terrace, Perth.

PN52

And your occupation, please?---I'm the employee relations manager for CBI Construction.

PN53

And this is in relation to the Phase 4 project on the North West Shelf?---That's correct.

PN54

And how long have you been in that position?---Since November of last year.

PN55

And how long with CBI?---For the same period.

PN56

And how long have you been involved in employee relations in the construction industry?---For 20 years.

PN57

Have you previously been engaged on the North West Shelf Project?---Yes, I have been.

PN58

And when was that?---During Phase 2 between 1986 or the middle of 1986 to the middle of 1989.

PN59

And in your current position with CBI Constructors, what are the nature and responsibilities of your position?---Broadly the recruitment of the - well, the craft work force as well as the staff personnel. Management of day by day labour relations issues, dealing with the client and the main contractor on industrial relations matters resolution of disputes etcetera.

**** MICHAEL JOHN DODGSON XN MR COOKE

PN60

Could you advise the Commission as to what is the nature of the work being undertaken by CBI Constructors on the Phase 4 Project?---CBI were awarded the mechanical erection on plot contract by Woodside which is basically the structural piping and equipment phase of the LNG - the fourth LNG process train.

PN61

And how many people are currently engaged by CBI on that work?---In the order of 250.

PN62

And when did CBI commence the work on the project?---The physical work in the field? In about March of this year.

PN63

And when do you, CBI, expect to complete your work on the fourth train project?---Our practical completion date with our contract is December of 2003.

PN64

And what number of people will be engaged by CBI when they hit their peak work force on the project?---As planned at this time, something in the order of 400 people.

PN65

And when would that peak be reached?---I believe that to be sometime around April/May of next year.

PN66

Now, how many advanced level certified riggers are employed by CBI on the project currently?---I believe it is in the order of about 50.

PN67

And will that number increase when the work force reaches its peak?---On the basis of our plan, yes, it will probably by another 20.

PN68

So to about a total of 70?---Correct. Can I just say, I mean, I can't guarantee those people will all be advanced but on the basis of our recruitment so far and our intention to get the best people, you could assume that.

**** MICHAEL JOHN DODGSON XN MR COOKE

PN69

Now, how many advanced level certificated scaffolders does CBI currently employ on the Phase 4 Project?---In the order of I think about 30.

PN70

And will that number increase when the work force reaches its peak?---Yes, it will. Just to qualify that, again depending on our scope of work, it could increase anything up to 70, possibly through to 100 people. Again, not all of those people would be expected to be advanced but a considerable number would be.

PN71

And do you have in place certified agreements regulating the employment of your construction employees on the Phase 4 Project?---Yes, we do. We have certified agreements with the Metal Workers Union, the Australian Workers Union and the CEPU Electrical Division.

PN72

Now, are you aware of clause 54(ii) of the project agreement that deals with certified riggers and scaffolders?---Yes. Yes, I am.

PN73

Now, how many of your advanced level - how many of CBI's advanced level riggers are paid the allowance prescribed by clause 5 point - (v)(4)(2)?---Just one.

PN74

And of your advanced level scaffolders, how many are paid that allowance?---I believe it to be in the order of eight.

PN75

Now, in your view, is the CBI properly applying that allowance? What criteria do you adopt this application?---Well, I believe we're properly applying it because the - we're applying it as per the written word of the provision in the sense that firstly people must have advanced certification and secondly that they are supervising others in that calling.

PN76

So you require them to meet both those tests?---Correct.

**** MICHAEL JOHN DODGSON XN MR COOKE

PN77

And that is how you interpret the agreement?---That is right.

PN78

That interpretation that you elaborate, is that the basis on which CBI tendered for work on the project?---Yes, it is. We were not provided with any information by any other party to indicate that that reading of that provision is any different to the way it is written.

PN79

Okay. Now, are you aware, given that you have worked in this State before, are you aware of the allowance prescribed by clause 10(2)(b) of part II of the Metal Trades General Award in the State Commission?---I can't say how it applied when I was here last time during the '80s, but I'm aware of that provision in the award and I'm aware of how it has been applied by CBI in recent years.

PN80

Would you agree that that provision is not dissimilar to the one in the certified agreement, in concept?---It is not dissimilar in concept.

PN81

Now, have you made any inquiries of your employer, how they apply that Metal Trades General Award provision when they work under that award in Western Australia, generally?---Yes, I have. The most recent other project CBI has been involved in was the construction of a water tank. Place called Goorlie which I understand is close to Southern Cross, and there were advanced personnel, primarily riggers, on that project and the allowance as prescribed by the award was not required or not seen to be applicable in those circumstances, in the sense of people - competent riggers - supervising others.

PN82

Are you aware of CBI Constructors applying that provision prescribed by clause 10 to part II of the Metal Trades General Award in a sort of across the board basis on other engineering construction sites in WA?---No, I'm not. I mean, I've inquired of our people who worked at Worsley and Murrin and they advised me that it wasn't done in that way.

**** MICHAEL JOHN DODGSON XN MR COOKE

PN83

Now, your company, does it employ metal tradespeople on the Phase 4 Project?---Most certainly.

PN84

In what sort of classifications?---At the base trade level, pipe fitters, boilermaker/welders, mechanical fitters, and then above trade, primarily in the area of special class welders CW6.

PN85

If the AMWU claim to have this allowance apply to all certified riggers and scaffolders was to succeed, what impact would it have on the relativities between the certified rigger and scaffolder and the tradespeople in your view?---Well, in the first instance it will close the relativity between those advanced certificated personnel and the base tradesmen to something in the order, as I understand it, of about 2 per cent of a difference. We are already aware of pressure from those tradesmen about their views of the wage rates and we have already had feedback from those tradesmen, or those tradespeople, I should say, with respect to that closing of that relativity. Again, I think it is fair to say that with the respect of the special class welders, the coded pipe welders across the industry and certainly on this project, there is considerable pressure with respect to the rates of pay those people receive, and again a closing of the relativity which would compress between those classifications would again cause pressure not only on CBI but across the project for some sort of flow or ratcheting effect for those classifications.

PN86

Now, in ball park terms, because obviously you won't know how many - you can only make estimations as to the number of advanced level personnel you will have at peak as riggers and scaffolders, but if the AMWU claim to pay that allowance to all advanced level riggers and scaffolders was to be applied from the start of your work on the project, can you advise the Commission as to what that might cost you or cost CBI in approximate terms at least?---Well, it's an exercise we've had to do and certainly our project control personnel and our project manager have had to do the calculations as best they can with those unknown parameters, because we've been required to communicate those to our client, and the figures that I'm advised on, it could be anything like $300,000.

**** MICHAEL JOHN DODGSON XN MR COOKE

PN87

Now, that cost, would the cost to your company of the claim being acceded to significantly reduce if it was only to apply from, say, 15 November 2002?---Yes, it would. I don't know about significantly but obviously it would be decreased, but you can see with our recruitment - our recruitment is still continuing beyond November 15, obviously, and it has an extrapolation effect, I guess. But there will be a reduction just in terms of the duration of the application of that claim, if it's successful.

PN88

Now, if the AMWU claim was granted, would it create any concern in your mind over people's commitment to holding together the project agreement, from the work force's perspective?---It most certainly would. And I think we're all aware that pre-start agreements are always under some scrutiny and pressure from employees as they come on the job because in some of the employees minds they would prefer agreements to be negotiated and confirmed when they're in employment on the project. We've already seen evidence from very early days in the project where employees are looking to interpret the agreement to their advantage and again one of the obvious defences to those sorts of claims is to indicate there is a certified agreement in place and effectively what people see is what they get. If there is an opening up of the agreement, it is not going to just rest with those people.

PN89

That would conclude our examination-in-chief, sir.

PN90

THE COMMISSIONER: All right. Just one point. You said that it would compress the relativities by 2 per cent or would it compress it to a difference of 2 per cent?---To a difference of 2 per cent, Mr Commissioner, is my understanding.

PN91

Mr Saunders?

<CROSS-EXAMINATION BY MR SAUNDERS [11.36am]

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN92

MR SAUNDERS: Mr Dodgson, in your evidence you raised the question of the Worsley Certified Agreement and the Murrin Murrin Certified Agreement. Was the Worsley Certified Agreement underpinned by the Metal Trades General Award?---I'm not aware of that. I made - I think I made the comment I inquired of people, because I was not there when there was an application of that allowance. So I don't know the answer to that question.

PN93

Well, if you inquired, did you ask why didn't it - why didn't the Metal Trades General Award Division apply?---I don't know why I didn't ask that, Mr Saunders.

PN94

And the same on the Murrin Murrin, wasn't it?---Again, I'm not familiar with the history. All I could do was ask people who were there.

PN95

Yes. Yes. So you wouldn't be surprised if I said they were composite awards which weren't underpinned by the provisions of the Metal Trades Award. Stand alone certified agreements?---No. I wouldn't be surprised.

PN96

No.

PN97

In evidence you talked about your contractual arrangements with your client and is it a lump sum contractual arrangement that is required?---Yes.

PN98

Or is it a schedule of rates?---It is a combination. CBIs contract is what is called an incentivised contract. We are reimbursed on rates for our employees but those rates are cast so they don't - they are not variable through the life of the project. It is incentivised to the extent of expended man hours less than schedule. There are benefits for CBI and hours that go beyond the schedule there are penalties to CBI and in their other parts of the contract with respect of material and staff, people, etcetera that are fixed. So we don't - if the question is do we get reimbursed for this change, no, we do not.

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN99

That wasn't the question yet but in the plain sense of the word, when we talk about contracts on the North West Shelf Phase 4 there is lump sum. Is that correct?---There - the civil package as I understand it were firm price or lump sum, yes.

PN100

Yes. Of course yourselves and people like United KGs, your contracts are referred as schedule of rate contract?---I'm not trying to be difficult, but they're similar to schedule of rates, once the rates are struck in the contract they are there for the duration of the contract.

PN101

There is no variation to that at all?---There is no variation at all.

PN102

Is there variation or is there inside that contract rate movements?---There is rates - rate movements to reflect the agreement in terms of the escalations, the two escalations that occur during the life of the agreement.

PN103

If the client didn't notify you of an allowance, for example, or you weren't aware of it you could go back to your client and have a discussion with him?---No. It is not the responsibility of the client to alert the contractor of how he has put his rates together but it is the responsibility of the contractor to inquire to ensure that they are reading the provisions of the agreement correctly and we did that and on that basis we put our rates together in good faith. We've been back to our client or our managing contractor and asked them their view of the provision and they believe that they're saying to us the - what we have said in our rates applied. There is no reimbursement on this claim, if the claim was successful we do not pick up that $300,000 if that is what the figure turns out to be.

PN104

They gave you that in writing, did they?---Our project manager, as is required to do, has written to KJV asking for relief on this claim if the union was successful in the claim and that letter has - we have had formal advice back from our managing contractor that that claim has been refused.

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN105

Yes. There is formal - - -?---There is a formal process, yes, and that is - - -

PN106

Sorry, has it formally been written back?---Correct.

PN107

Are you going to tender that today?---No. That is a commercial matter between CBI and its client, but I can confirm it. I'm happy to confirm under oath letters have gone in and come back.

PN108

You said in your evidence that there had been some pressure by trades persons and that they had related back to you that if the advance rigger or scaffolder received the increase then there would be concerns by those trades people. Is that right?---I don't think I said it that way, I think what I said was that there are other classifications, although particularly the base trades, who are talking also about how they can get more money out of the agreement. I then draw the conclusion that any movement within the agreement will cause pressure - further pressure and angst amongst those people to agitate for further monies.

PN109

So it is only supposition, you haven't asked the question then?---No. We've certainly heard - we have certainly heard through - - -

PN110

Have you asked the question of the trades people if the advance rigger and scaffold allowance is paid will that cause further concern to the trades?---No. I haven't asked that question.

PN111

Okay. If you could turn to the Metal Trades General Award, which Mr Cooke asked you about, the division, and you said it is very similar in context to what is prescribed in the North West Shelf Phase 4 Agreement, and of course it says:

PN112

A certified rigger, other than a leading hand -

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN113

so there is a slight difference there, isn't there?---Yes. There is. Doesn't refer to scaffolders, as I understand it.

PN114

Yes. A certified rigger is who?---He is a rigger with certification.

PN115

Right. So that could be a basic rigger?---Could be.

PN116

Intermediate rigger?---Could be.

PN117

Or an advance rigger?---That is correct.

PN118

Right. So the provisions in the award are quite different, aren't they?---The - the provisions in the award reflect the competency standards that used to exist at the time of the award, as I understand it.

PN119

Well, no, the award - - -?---The basic - the basic, intermediate and advanced classification or competencies arise out of Federal law and Federal arrangements.

PN120

The award is very clear, it says "Certified rigger", doesn't it?---It talks about a certificated rigger, yes.

PN121

Yes. So it could be a basic. Is that correct?---I've already said that.

PN122

So it was completely different. It also goes on to say that he gets paid a leading hand's allowance, doesn't it?---I'm not aware of - - -

PN123

Well, I will read the provision.

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN124

MR COOKE: Perhaps it might be handy, I have a copy of the provision the witness could be handed and that way we're not testing his memory.

PN125

THE COMMISSIONER: Yes. Sure. Have you got a copy for me too?

PN126

MR COOKE: Certainly have, sir. Perhaps we would seek to have that marked as an exhibit.

EXHIBIT #C1 COPY OF AWARD PROVISION

PN127

MR SAUNDERS: The provision says:

PN128

A certified rigger other than a leading hand in compliance with the provisions of the regulations made pursuant to the Construction and Safety Act of 1972.

PN129

He is responsible for:

PN130

...the supervision of other employees shall be deemed to be a leading hand and be paid the additional rate prescribed for a leading hand placed in charge of not less than 3 and not more than 10 employees.

PN131

So the allowance for a certified rigger is a leading hand allowance. Correct?---In the context of this provision, yes.

PN132

So under the award provision he would receive whatever the leading hand allowance is?---If he was supervising other employees?

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN133

Yes?---Yes.

PN134

Is that similar to what is in the North West Shelf Certified Agreement?---The - there is a test in the award provision, as I read it, about certification and there is a test in the award provision with respect to supervision. In the North West Shelf Agreements, North West Shelf Project Agreements there is an amplification in terms of the classifications - by that I mean there is both riggers and scaffolders who hold advance competencies but there still remains the test of supervision.

PN135

Yes. But it is fair to say in the North West Shelf Certified Agreement he doesn't get the leading hand's allowance unless he is appointed as a leading hand. Is that correct?---That is correct he gets - it is a lesser amount of money.

PN136

So it is a distinct allowance?---It is a lesser amount of money, yes.

PN137

Yes. Yes. So you would have to question why the union would vary to have a lesser amount of money, especially the riggers mind you, than the award prescription, wouldn't you?---No. I mean I'm not sure what was in the union's mind when they put that provision.

PN138

We will tell you. Don't worry, we will let you know before this is over?---Okay.

PN139

MR COOKE: Perhaps Mr Dodgson might be left to answer the question and we will get home sooner.

PN140

MR SAUNDERS: Maybe I don't want him to.

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN141

THE WITNESS: My simple answer to that, Mr Saunders, is that if the union intended for all advanced personnel, either riggers or scaffolders, to receive the money I would have thought the provision would read: scaffolders and riggers with advanced certification will get X dollars per week with nothing else attached to it.

PN142

MR SAUNDERS: When the authors of the document, the negotiators of the document, negotiated that you weren't there that week?---No. I was not.

PN143

No. Of course, a basic rigger in the North West Shelf Phase 4 Agreement he is on a different rate of pay than say an intermediate or an advanced, isn't he?---That's correct. The basic - - -

PN144

In fact he is a - - -?---The basic rigger is paid less than the advanced and intermediate rigger.

PN145

So he is on CW3, by memory, isn't he?---I believe so.

PN146

Yes. Of course, under the award he would be on the same amount of money as an advanced rigger. Is that correct?---Under this award?

PN147

Sorry, the Metal Trades General Award?---Well, the difficulty I have, Mr Saunders, with trying to draw the bow back to the award is that the award only talks about certificated riggers and non-certificated riggers. Since the Federal competencies came in there are three levels of certificated riggers.

PN148

I didn't raise the award, Mr Cooke raised the award and you made comment on it?---Well, I asked - - -

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN149

As a person of experience, as I understand it, now you tell me you haven't got that experience. Is that what you're trying to tell me?---No. I didn't say that, I said that the certificated rigger and scaffolder in the State Award does not reflect the national competencies that have been in Australia since about 1992 where there are three levels of competency for both riggers and scaffolders. All this talks about is some - one person who is competent and one person who is - or one person who is certificated and one person who isn't.

PN150

A certified rigger on a construction site, other than the North West Shelf, whether it be basic or advanced, would receive the amount prescribed under the Metal Trades General Award for a certified rigger and scaffolder. Is that correct?---I don't disagree with that.

PN151

Of course, the intermediate and advanced riggers are CW4 under this particular project agreement?---That is correct.

PN152

Yet there is a difference in the skills of both those, between an intermediate and advanced riggers and/or scaffolders?---I think just by their very words indicate, yes, there is a difference of competency between the two.

PN153

Yes. Of course, maybe the authors or the negotiators of the document recognise that, has that ever crossed your mind, when you reviewed the - - -?---I don't know what was in the mind of the people who negotiated the agreement.

PN154

Yes. That is fair enough. I wouldn't expect you to, wouldn't expect you to, but you're willing to interpret without clarification from at least one of the sides of the negotiators.

PN155

I have no further question.

**** MICHAEL JOHN DODGSON XXN MR SAUNDERS

PN156

THE COMMISSIONER: Right.

PN157

MR COOKE: An no re-examination, sir.

PN158

THE COMMISSIONER: Right.

PN159

Mr Dodgson, you can step down and go or stay, whatever you wish?---Thank you, Commissioner.

<THE WITNESS WITHDREW [11.49am]

PN160

MR COOKE: May I have a brief adjournment, sir.

PN161

THE COMMISSIONER: Yes. Sure.

PN162

MR COOKE: Perhaps about 5 minutes just to receive instructions from Mr Dodgson.

PN163

THE COMMISSIONER: Okay then. Right.

SHORT ADJOURNMENT [11.49am]

RESUMED [12.07pm]

PN164

THE COMMISSIONER: Right.

PN165

MR COOKE: Sir, having completed the evidence of Mr Dodgson we would suggest an appropriate course of action now would be for the union to put their case and we will put our case in response and then bring the balance of our evidence. If it please the Commission.

PN166

THE COMMISSIONER: All right. Happy with that, Mr Saunders?

PN167

MR SAUNDERS: Yes, yes. I should have been forewarned, but that is okay, during the break. Sir, after the application by the Chamber of Commerce and Industry on behalf of the contractors the Commission sought that the matter by agreement be heard under section 111AA and our organisation responded to that request on the 13th of the 12th and I note that on the 18th of the 12th so did the Chamber of Commerce and Industry on behalf of the contractors agree to that process.

PN168

Sir, the matter is that the agreements in question, which are the North West Shelf Project Phase 4 Agreements, there is a contention about clause 5 subclause (4)(ii) and that clause reads:

PN169

A certified agreement or certified scaffolder with Advanced Certification of Competency other than ...(reads)... leading hand and paid an all purpose allowance of $19.10 per week.

PN170

On the previous page to that under subclause (4)(i)(a) it sets out leading hand allowances and says:

PN171

If placed in charge of not less than 3 or not more than 6 other employees an allowance of $27.40 -

PN172

and goes in (b), it says:

PN173

If placed in charge of more than 6 but not more than 10 employees an allowance of $34.97 as of 1 September 02.

PN174

Obviously, it is our submission, sir, that these two allowances, one applies to advanced riggers and scaffolders and the other allowance, set out in the leading hand allowance clause, applies to those who are appointed or nominated as leading hands, whether they're advanced riggers or scaffolders or not. Sir, it is also our submission that the provision in the Metal Trades General Award, some may say it is similar but we would say that it is completely different.

PN175

In the Metal Trades General Award Part 2, that is in clause 10(2)(b) it states that:

PN176

The certified rigger, other than a leading hand, with compliance with the provisions of regulations made ...(reads)... hand placed in charge of not less than 3 and not more than 10 employees.

PN177

Sir, first of all, we submit that it only talks about certified riggers, certified riggers in that context can be basic, intermediate or advanced. It doesn't talk about scaffolders and the allowance that applies is the leading hand allowance. Of course, the clause in the North West Shelf, it was constructed by the negotiators in a completely different context on the basis that first of all under the Metal Trades General Award all riggers, whether they be advanced, intermediate or basic, receive the same rates of pay.

PN178

We submit that in putting together the agreement it was - by the negotiators, it was always intended that, first of all, it recognised the difference in skills or competency and that was reflected in the definitions clause, which is clause 3 and the first one is Roman subclause (iii) under CW3: Task Undertaken. In that area it says:

PN179

Duties of a scaffolder or a rigger holding the basic certificate of competency, ie, not holding an intermediate or advanced certificate of competency -

PN180

and it sets out a rate of pay which is $876.43. Completely different to that of what the award says, which is if you like the 96 per cent of the tradesman's rate. It goes on under subclause (iv) in the North West Shelf Project Agreements to say:

PN181

A rigger or scaffolder holding an intermediate or advanced certificate of competency -

PN182

and they get paid a rate of $904.70. Of course, in evidence, and I will come back to that, it was recognised by the applicant's witness that there is different skills and competency between an intermediate and/or an advanced rigger or scaffolder. So it then brings you to the clause that is in question, and that is what is the meaning of the clause in question. That should be read the same way as the Metal Trades General Award Part 2, that is that people who may be responsible of looking after other scaffolders, "other" meaning in the context under the Metal Trades General Award, because there is a provision there for rigger, scaffolder, other, that they receive a leading hand's allowance in accordance with that award or should it be read as it was intended to, in our submission, that the allowance is not that of a leading hand's allowance it is an allowance that we submit was negotiated to recognise the skills that are different from the intermediate to the advanced scaffolder.

PN183

In other words, those people who are employed and on this particular project they receive recognition for the advanced competency and skills that they hold in the same way as the authors and negotiators of the agreement readily prescribe in the agreement, that there is a difference between a basic scaffolder and rigger to an intermediate scaffolder and rigger. In that context, why would the negotiators, and we would submit that they wouldn't on the union's side, agree to recognise that there are different skills, there are different skills between a basic and an intermediate scaffolder and then say: well, we recognise there is different skills between an intermediate and advanced scaffolder but not recognise that in remuneration.

PN184

We submit, sir, that on the face of it that the provision set out in the certified agreement was always to apply to those people who held the highest competency standards in those two classifications and that I would submit, sir, that the provision to some degree was extracted out of Metal Trades Part 2 and should have been expressed differently but it was the true intent, if I could put it this way, it was the true intent by the unions that the allowance should apply to all advanced riggers and scaffolders.

PN185

Sir, we haven't brought evidence so it is from the bar table, this provision applies in a number of certified agreements registered in this jurisdiction and we submit, sir, that on all occasions we're not aware on this occasion that that provision is not applied in the way that the union puts this afternoon. We take note of the evidence brought by Mr Dodgson, who raised the issue about the Murrin Murrin and Worsley Certified Agreements, sir I would submit that at least the Worsley, by memory, did not have that provision and that I would suggest strongly that the Murrin Murrin one didn't have that provision and that is why it wasn't paid.

PN186

Worsley is a definite and I would suggest, I haven't checked the Murrin Murrin, but there was no - I have no recollection that it was brought to my attention while that project was being constructed, that there was a problem about the allowance so I take it, if it was in that Murrin Murrin agreement, it would have been paid, but it may not have been in that agreement. The other area that was led in evidence was when should the allowance apply.

PN187

Sir, we submit strongly that on our reading of the allowance, it should have applied from day one. It can't be an allowance if we are correct and our submissions are accepted and supported by an order of this Commission, then the allowance applies from day one, not from a certain date, as Mr Cooke tried to have evidence from Mr Dodgson to say: well, what is the cost impact if it applies as of the, I think the 15 November was the date that was suggested. Sir, but we would argue strongly that the allowance applies as of the date of operation of these agreements coming into effect to apply to workers on the particular project, if it please the Commission.

PN188

THE COMMISSIONER: All right, thanks Mr Saunders. Mr Cooke?

PN189

MR COOKE: Thank you sir. The position we are putting forward Commissioner this afternoon, is based on several fronts. We say sir, that the way the contractors are applying the rigger/scaffolder allowance currently, is the correct manner. We would suggest to the Commission, or submit to the Commission that if the union claim was to succeed then a number of issues arise. First there is the potential of the impact on the relativities set out in the site agreement and the compression of those relativities and the potential that may cause for dispute.

PN190

Secondly, is the potential that it may serve to trigger or exacerbate other persons to look at the agreement and try and find areas which they can leverage against the employers to produce higher wages and conditions for themselves and in turn lead to potential disputation. Thirdly sir there is the obvious cost impact on the contractors if the claim should be successful. The way the contractors are applying the agreement is the basis on which - follows the basis on which they tendered and really it means the ground has shifted under them since they commenced work on the project.

PN191

Fourthly, there is the impact of similar clauses in the award and on other projects where the clause exists as currently set out. Fifthly sir, we say that the literal meaning of the words in the certified agreement are quite clear and unambiguous. To get the allowance the employee simply has to be an advanced level, certified rigger and scaffolder and (2) be responsible for the supervision of other employees.

PN192

THE COMMISSIONER: Wouldn't the person who is responsible for the supervision of other employees, be a leading hand?

PN193

MR COOKE: Good point sir, but - - -

PN194

THE COMMISSIONER: Or a foreman?

PN195

MR COOKE: Well, in fact they wouldn't be, because if you look at the leading hand at WAIT sir, the first one is for someone who is charge of not less than three and not more than six employees, so you could in fact be a certified rigger or a scaffolder, at advanced level and you may only be responsible for say, as a rigger, maybe for a dogman, or one or two other people. You are taking some responsibility, you are supervising them, but under the terms of the agreement, because there is not three other people, you don't receive any recognition, or reward for that.

PN196

And indeed Mr Saunders raises the issue of what did the draught people, or the - or draughtsmen, because they were all male, what were they thinking at the time. Well, it may be that what they were thinking at the time is as with the award, it is a reward and a recognition for people who would otherwise not fit within the leading hand category. And indeed the provision itself says: other than a leading hand. So, it is designed to pick up people for whom the general leading hand provision is deficient.

PN197

THE COMMISSIONER: What would happen for an intermediate regular, or a basic regular who is responsible for a dogman, he doesn't get paid anything for his responsibility?

PN198

MR COOKE: That is right. But I haven't got the full competencies front of me sir, the basic person has a very limited range of work they are in fact allowed to do. The person is really little better than an unlicensed person and indeed that is really what it replaced under the old dichotomy. As I said sir, there is the potential - we say that the literal wording of the certified agreement was quite clear and unambiguous and sets out plainly who would receive the allowance and who would not. As we indicated earlier there is the concern of the potential to open up the certified agreement and the potential for people to look to run claims of a like nature.

PN199

We would submit, sir, that the way the agreement is currently being applied on site and Mr Dodgson's evidence indicated they had been on site since May of this year and the issues arises in October or thereabouts of this year, means that for some period of months people worked under the agreement in a manner that was entirely on all fours with the way the employers say that it should be interpreted and we say that in a sense reinforces the view that the interpretation the employers have adopted since day one, is indeed the correct interpretation. And we say that, finally sir and having participated in the discussions that led to the creation of the agreement, that it is certainly my clear recollection that the allowance was to be worded in the way it was, because that was the nature of the agreement reached, not because it was to apply in some alternative manner.

PN200

Sir, exhibit C1 sets out really the parent provision of this, the Metal Trades General Award, bless its little heart, it is nearly as old as I am, it is a little bit outdated, it belongs to the days where there were two classifications of rigger/scaffolder, either one was certificated, or one was not. There was the licensed, or unlicensed and there was a provision in there for the certificated rigger, other than a leading hand, who is responsible for the supervision of other employees, be deemed a leading hand and then be paid the leading hand rate for three to 10 employees.

PN201

I am not aware of how that provision came to be. We have done some research as to when it went into the award and it appears it was in 1979 and I was in high school at the time and no one consulted me about the matter. I seek to hand up an exhibit sir, which is just an extract from the WA Industrial Gazette, at volume 15 of the Gazette, at page 613, when it first came in.

PN202

THE COMMISSIONER: That would have been about the time that the metal trades were pursuing the experienced tradesmens' rates and they were scrabbling around to find something for everybody in the award and didn't want it to flow on to anybody else.

PN203

MR SAUNDERS: I remember that sir, I was with another union.

PN204

MR COOKE: Perhaps if that could be marked as an exhibit sir?

EXHIBIT #C2 EXTRACT FROM WA INDUSTRIAL GAZETTE, VOLUME 15, PAGE 613

PN205

THE COMMISSIONER: Sorry, continue.

PN206

MR COOKE: No, that is fine. As I say, we did some research back through the history of the award, that is the first time it turns up, it was a consent variation, or a consent consolidation of the document and low and behold it is there. So, it doesn't actually provide any detail as to what the people who had put it in were thinking at the time and it was over 20 years ago, so most of those people are no longer actively engaged in employee relations. But you can see that fundamentally the wording hasn't changed from - if you compare exhibit C1 and C2, that it is effectively the same wording that is there today and it does apply only to riggers and it certainly doesn't apply to scaffolders.

PN207

The issue did arise, and I think it initially arose in the CBI constructors work force sir, in approximately October of this year and there were a number of issues raised at the same time and Mr Saunders in fact wrote to myself on 15 November 2002, setting out two of those issues and I would seek to tender that correspondence, if I may.

EXHIBIT #C3 CORRESPONDENCE FROM MR SAUNDERS TO MR COOKE, DATED 15/11/2002

PN208

MR COOKE: The union raised the arguments that they believed it should be paid to all advanced level riggers and scaffolders and the union noted that the argument they have raised today, why would they have agreed to a lesser allowance than the leading hand allowance, which otherwise applies in the certified agreement. As I say there can be no criticism of the way the union have progressed the matter, we have sought to resolve the matter through the dispute settlement procedure and there have been discussions between the parties, but there has been no common understanding reached and hence we are before the Commission today.

PN209

The background of the matter, sir, from our perspective, is that sort of between, I think it was approximately April to September last year, there were discussions on a project agreement, to apply to the phase 4 project. Those discussions involved the AWU, the CEPU and the metal workers along with KJV and the CCI and I was there in the capacity as a CCI employee. Mr Saunders and on occasions a Mr Ferguson and additionally Mr Ferguson, were the metal workers' representatives and the prime negotiators.

PN210

Eventually, in mid-2001, the AWU actually sort of broke away and reached an agreement for civil work particularly in relation to the civil OMPLOT contract, the metal workers had several issues that they were not able to agree to and wanted additional areas addressed above what was in the civil project agreement and the mechanical agreement wasn't actually concluded till sort of September/October 2001 and was indeed then certified. If one takes the CBI as an example, the CBI agreement as an example, it was certified on 16 November 2001.

PN211

My recollection sir, my notes indicate that the position reached was that the metal trades general award, part 2 construction work provision, relating to riggers, was to be included in the mechanical project agreement and indeed that is the outcome that is largely reflected in the agreement. The obvious distinction is that instead of referring simply to certificated individuals, it refers to those holding the advanced level of competency and it extends to riggers and scaffolders, rather than purely just riggers. It strikes a rate that is less than the leading hand allowance, three to six, but again, it needs to be - note taken into account that if someone was a suitable advanced level rigger/scaffolder, engaged in supervising three to six employees, they would get the leading hand allowance.

PN212

So there is no discounting in that sense, it is actually providing an additional benefit to those people who are not supervising three other employees, they may only be supervising one or two other employees. So, generally under the award or under the agreement, if the allowance didn't exist the person would be getting no recognition, or reward for supervising one or two other people, because of the wording of the award, those supervising one or two other people do get an additional benefit, but it is not as great as the leading hand, three to six rate, but then again they are probably not assuming quite as much responsibility.

PN213

The issue, as we say, didn't arise until about October of this year, which is about 12 months after the project agreement was certified and about six months after - or five months after metal trades employees commenced on the site and we say the interpretation, this is not a question of the interpretation of the allowance has changed on the employers part in any sense. We have had a consistent approach to the interpretation of the allowance and the fact that the parties have acted on that basis would seem to reinforce, in our view sir, the fact that that is indeed probably a reasonable approach.

PN214

And there are many examples sir, where the conduct of the parties can be taken into account, as in support of an argument of interpretation of a provision being award, or an agreement provision, one way or the other and the conduct of the parties is certainly an indicator that the Commission should take into account in determining the question before the Commission today. When one looks at what applies elsewhere in industry sir, we have been unable to find any other certified agreement in this State, that has an allowance that applies across the board to all certified riggers and scaffolders.

PN215

There are agreements that have verbiage, that provide allowances to certified riggers and scaffolders, but they tend to follow the same model for the Metal Trades General Award. As I said we haven't been able to find an across the board allowance to all advanced level riggers and scaffolders and we have looked at the HBI, Murrin Murrin, Collie Power Station, Worsley, Cape Lambert upgrade, West Angelas, sort of agreements, the whole swag of them. As I said where the allowance does exist, it is generally in the same, or follows the model set out in the Metal Trades General Award and we would seek to hand up an extract from the Monadelphous Engineering Associates (West Angelas Plant Project) Metal Trades Certified Agreement 2001, if it please the Commission.

EXHIBIT #C4 EXTRACT FROM MONADELPHOUS ENGINEERING ASSOCIATES (WEST ANGELAS PLANT PROJECT) METAL TRADES CERTIFIED AGREEMENT 2001

PN216

MR COOKE: If one goes to - and I haven't handed up the whole document sir, obviously the relevant part is the attached page, which is clause 3.3.2, where it says: Certified riggers allowance.

PN217

A certified rigger, other than a leading hand, who is responsible for the supervision of other employees, shall be deemed to be a leading hand and be paid the additional rate prescribed.

PN218

Now, whilst it doesn't slavishly follow the Metal Trades Award provisions sir, it doesn't take a Rhodes Scholar to work out where it has come from. The key elements are still there. Needs to be a certified rigger, needs to be responsible for other employees, picks up the leading hand rate. So, that is a relatively straightforward example, in our view sir, of other agreements, or another agreement that picks up the similar approach to life. We also seek to hand up, sir, extract from the Monadelphous Engineering Associates Proprietary Limited (Cape Lambert) Metal Trades Certified Agreement 2001.

EXHIBIT #C5 EXTRACT FROM MONADELPHOUS ENGINEERING ASSOCIATES PROPRIETARY LIMITED (CAPE LAMBERT) METAL TRADES CERTIFIED AGREEMENT 2001

PN219

MR COOKE: Just one minor point from my perspective sir, is that whilst I was involved in the negotiation of the LNG4 agreement, I certainly wasn't involved in the negotiation of any of these agreements, so there was no individual quirk coming in to play. Here the agreement, sir, clause 3.3.2 changes slightly, in that it does refer to a certified rigger or scaffolder and then the verbiage otherwise follows. Again there is a requirement to be responsible for supervising other employees and it is a little less - it might be slightly ambiguous, be deemed a leading hand and be paid the additional rate prescribed and one can interpret from that that is the appropriate leading hand rate. So again, sir, basically an adaptation from the Metal Trades Award provision. And the final agreement that we would - or extract we would seek to hand up sir, arising from this series of agreements, is one from the United Construction Proprietary Limited (Cape Lambert) Metal Trades Certified Agreement 2001.

EXHIBIT #C6 EXTRACT OF AGREEMENT FROM UNITED CONSTRUCTION PROPRIETARY LIMITED (CAPE LAMBERT) METAL TRADES CERTIFIED AGREEMENT 2001

PN220

MR COOKE: The same provision applies sir. When one goes to the clause 3.3.2, again we are back to the model where it is a certified rigger, rather than by a certified rigger and scaffolder, but the key elements are still there, requirement to be supervising others. You are deemed to be a leading hand, paid the additional rate prescribed. So again, sir, the DNA from the Metal Trades Award Part 2, is quite plainly transmitted to the progeny. So we say sir that where the allowance does exist, it tends to be in the same terms, broadly speaking, as the Metal Trades General Award Part 2 Construction Work. It has not slavishly followed it, there are variations on the theme, but the theme is being a rigger, scaffolder, a certificated rigger/scaffolder, being responsible for supervising others, getting paid an allowance, notwithstanding you are not a leading hand.

PN221

There are other provisions sir, if one goes to the recently certified agreements for the High Smelt Project, similar provisions there in the same terms as is in the agreement, the difference is it refers to the Mine Safety Inspection Act, rather than the Occupational, Health and Safety Act. So, the theme continues. Turning now, sir, to what we say is the intent of the agreement. We say that the clause 5(4)(2)(ii), as we said it is not in the least bit ambiguous, it is quite clearly drafted. A person has to have two tests, a person has to be have an advanced certificate of competency as a rigger or a scaffolder and be responsible for supervising other employees and you get the allowance.

PN222

And we say that broadly follows the model out of the Metal Trades General Award, albeit it is refined the scope in terms of advanced level and has broadened the scope in terms of incorporating scaffolders. We say you couldn't reasonably interpret that, but it means that everyone at advanced level gets the allowance. We say it is not really a matter in which the Commission would need to turn to extrinsic aids to assist in discerning the intent of the sub-clause, I mean the plain meaning of the sub-clause is reasonably crystal clear.

PN223

In terms of relativity sir, under the Project Labour Agreement, currently a trades person at the CW5 level and there is the 100 per cent benchmark around which all others are configured. Currently a trades person is on $942.40 for a 38-hour week. An advanced level certificated rigger or a scaffolder, is on the 96 per cent level, that is CW4 and they are currently paid $904.70 for a 38-hour week. So the difference in the two wage levels, currently, per week, is $37.70, for a 38-hour week, or just under a dollar an hour on an all purpose basis. If the metal workers' claim were to be granted and every advanced level rigger and scaffolder was to receive the all purpose allowance of currently $20.06 per week, then all of a sudden the differential between the metal trades persons' weekly rate and the advanced rigger/scaffolder weekly rate would be reduced to $17.64 per 38-hour week, or about 46 cents an hour.

PN224

The obvious implication for the CW5 classification, or grouping, may perceive that they are not receiving a sufficient marginal award for their additional training and skill over that of an advanced rigger or scaffolder and that we say is likely to lead to new wage and allowances claims by that CW5 classification grouping of employees and potentially further unrest and potential industrial action. We say that further the certificated rigger/scaffolders who take responsibility currently under the agreement, as being appointed as leading hands by their employer, pursuant to sub-clause 5(4)(i) of the agreement, would then be receiving only $7.34 per week more than the plain sort of garden variety advanced level rigger/scaffolder, for having assumed that responsibility.

PN225

Or put another way a leading hand advanced rigger/scaffolder would be receiving only - at the 3 to 6 level of a leading hand, would be receiving 19 cents an hour more than their peers, or the other advanced level rigger/scaffolders, for assuming the responsibility as a leading hand and we say that, again, is likely to cause those people to wonder why they are taking the task of being a designated leading hand. In terms of the agreement and the sort of sanctity of the agreement sir, the project has nearly 18 months still to run. The work force has yet to hit peak.

PN226

We say that any move that reopens the certified agreement, is likely to serve to encourage new, further and additional claims in relation to wages, allowances and employment conditions and that these may be couched as interpretations, or reinterpretations, but could lead to a literal procession of claims to the employers and ultimately to this place and we say, sir, that the message that would send the work force, would be entirely unnecessary. In terms of cost impact sir, the evidence will show there is a significant, direct cost impact if the claim was to be granted, particularly on CBI and United KG.

PN227

Although they are not party to the proceedings, the electrical contractor and the painting and insulation contractor are likely to employ riggers and scaffolders and those contractors would also be up for the costs that they - as with UKG and CBI, could not reasonably have anticipated. Contractors bid for work on the project, based on the project agreement, by giving its text its plain meaning and likewise the contractors have been applying the agreement in a manner which a simple and plain English interpretation of the agreement would support and we say that is the appropriate way forward in this regard.

PN228

To turn briefly, sir, to several decisions that are of note in such matters. In terms of the way interpretation of agreements and awards should proceed, we would cite the decision of the Industrial Appeal Court in the matter of Norwest Beef Industries Limited v Derby Meat Processing and the West Australian Branch Australian Meat Industry Employees Union, Industrial Union of Workers. If I can hand up a copy of that sir. I don't know if it needs to be exhibited sir, it is an extract from the public record.

PN229

THE COMMISSIONER: No.

PN230

MR COOKE: For the point of the record it is found at volume 64 of the West Australian Industrial Gazette, page 2124 and I would, rather than repeat the whole decision, which deals with the days when there used to be a meat processing industry in the Kimberley - - -

PN231

THE COMMISSIONER: Yes, DEMCO, yes.

PN232

MR COOKE: Sorry?

PN233

THE COMMISSIONER: DEMCO the company was known as.

PN234

MR COOKE: Yes, but life has moved on since then and a matter of historical significance only now. But at the left hand column on page 2127, in the area highlighted, it talks about the principles to be applied in interpreting awards, are the same as the principles to be applied in the courts, for the construction of deeds, instruments and statutes and they refer to several cases. Applying those principles the argument goes - and this was the respondent, the union's argument:

PN235

The meaning of the provision of the award is to be obtained by considering the terms of the award as a whole. The terms are clear and unambiguous it is not permissible to look to extrinsic material to qualify that.

PN236

And then there are cases, particularly from the Commonwealth Law Reports and the WA reports cited in support of that contention and again it goes on to say that:

PN237

There is only need to go to outside extrinsic aids to assist in the interpretation of awards, where there is some question of ambiguity and whether there is an ambiguity is a matter of interpretation of terms, which in turn, turns to a question of facts.

PN238

His Honour then, Brinsden J, whose extract from the decision I am reading, then goes on to say and I quote, from the right hand column, the second last full paragraph:

PN239

In the hope that I've not fallen into the lawyers trap of seeing difficulties where none exist, my view is that clause 12 is ambiguous ...(reads)... parties over the years in carrying on their relations to each other, pursuant to the earlier awards and indeed under these two awards.

PN240

And then references that to a case in the Industrial Gazette and a Federal Law Report. So we say sir, that apart from whether there is a need to deal - turn to extrinsic material to interpret the provision, we say it is not necessary, we say the provision is itself clear, but if the Commission was minded to do so, then we say the Commission can look at the conduct of the parties between May of this year when CBI started on site and October of this year when the claim was first raised and we say that that is instructive in that regard.

PN241

The second decision we would like to refer the Commission to is a decision of the Commission as currently constituted in the matter of Ralph M. Lee Proprietary Limited. Decision found at print T1204, published in Perth on 27 September 2000. The application dealt with a matter by - an application by Ralph M. Lee Proprietary Limited, to vary a certified agreement, pursuant to section 170MD(6) of the Workplace Relations Act, because we contended there was - the company contended there was an ambiguity in the agreement that didn't cater for the employment of an unapprenticed junior.

PN242

What we would refer from that decision sir, at paragraph 12 and we won't quote it in detail, is the Commission in currently constituted in looking at the question of whether the Commission should vary an agreement for the purposes of removing an ambiguity or uncertainty, we refer to the decision of the Full Bench of the Commission in the matter of the Public Transport Corporation Victoria and the Australian Rail, Tram and Bus Industry Union, print M2454 and the Commission quoted from that at some length and I don't think that is appropriate or necessary to repeat that.

PN243

We acknowledge that the matter before the Commission today isn't actually in a variation of the agreement pursuant to section 170MD, but we say some of the principles are certainly relevant. There is also the decision at paragraph 13 sir, quotes Munro J, in similar dealing with section 170MD, where he noted that to exercise the power under 170MD, first of all there had to be an obvious ambiguity or uncertainty in the agreement and that for that the ambiguity had to be so identified.

PN244

We say sir, that really there isn't an ambiguity that could be similarly identified in this matter, as the Commission noted in the Ralph M. Lee matter, at paragraph 14 and 15, there had to be - to act really the Commission would need to identify an ambiguity or uncertainty in the agreement and the applicant could not direct the Commission to a clause, or a combination of clauses or words that displayed themselves as ambiguous, or created an uncertainty and then the Commission, at paragraph 22, quoted Munro J:

PN245

It may not be appropriately -

PN246

On 170MD(6):

PN247

It may not be appropriately used to rewrite an agreement to install something that was not inherent to the agreement when it was made.

PN248

And we say sir that if the claim of the metal workers was to be granted today, that is in effect what would be occurring, that something that really wasn't inherently in the agreement when it was made between the parties, is then reinterpreted to become something quite different, altogether.

PN249

THE COMMISSIONER: Can somebody tell me what this very strange wording:

PN250

Who, in compliance with the provisions of the regulations, made pursuant to the Occupational Safety and Health Act 1984, is responsible for the supervision of other employees.

PN251

How does the supervision of other employees create a compliance with the Safety and Health Act 1984? Does anyone know what the heck that means?

PN252

MR COOKE: I certainly recall under the Construction Safety Act sir, that where unlicensed people were working at the direction of licensed personnel, that you simply could not have unlicensed people putting up scaffold, for argument sake, you had to have a licensed person overseeing them. My understanding, although I stand to be created on the point, is that similar provisions exist under the Occ Health and Safety Act, I would be surprised if there is a facility for unlicensed people to go out and build scaffold of their own volition. Mr Saunders may be able to assist on that point I think he has been on the construction safety board?

PN253

MR SAUNDERS: Yes, I concur that is what the provision means.

PN254

THE COMMISSIONER: And the Act says that:

PN255

An unlicensed person cannot work without supervision.

PN256

Is that what it virtually says?

PN257

MR SAUNDERS: Well it is the opposite, it says - the Act says that that needs a licence, or a certified person to work on a particular scaffolding or ..... work and then sets out competency standards to that extent.

PN258

THE COMMISSIONER: All right.

PN259

MR COOKE: Just briefly sir, there are a couple of other decisions that we would seek to refer the Commission to. One is a decision of Commissioner Blair, May 1994, you live long enough I find myself quoting the words of Mr Wilson, then of Fleur, not something I would have thought I would do frequently. The relevant part of the decision, sir, was again a difference of opinion over the meaning of a term in a certified agreement. Page 2 of the decision, in the third full paragraph, I quote:

PN260

The union has indicated that the clause written in the agreement does not truly reflect the agreed position. Mr Wilson, for the ...(reads)... words alone, given that they were negotiated, voted on by members of the union and registered by the Commission.

PN261

And then moving through the decision, at page 4 of the decision, the Commission quoted itself on transcript and I quote, about halfway through that extract:

PN262

Upon reaching that agreement, whatever the intent was a set of words was put down on paper and those set of words, whether they ...(reads)... mass meetings of your members, all of your members voted on and then brought it to this Commission for certification.

PN263

As you know, under the old 134, the Commission had no option but to certify the agreement. Continuing:

PN264

In the Commission's view it emphasises the need for agreements to reflect correctly what the parties have agreed upon, rather than ...(reads)... certified, this does not provide the grounds for stable industrial relations, or for developing good will between the parties.

PN265

End of quote.

PN266

THE COMMISSIONER: I am blowed if I can find that, where was that?

PN267

MR COOKE: It should be on page 4 of 4 sir.

PN268

THE COMMISSIONER: Page 4 of 4, yes.

PN269

MR COOKE: I hope you have got a correct copy.

PN270

THE COMMISSIONER: Yes, I see that.

PN271

MR COOKE: And what we say sir is that a similar approach can be reasonably adopted in this case. The only thing that differs is the mechanism in this case was a Greenfields Agreement as against an LJ Agreement. But, a similar approach can, as we say, properly be adopted in terms of once there are words on paper and signed off at, people have a right to rely on them we say. The final decision we would refer to sir, is the decision of Munro J, on 30 June 1998, found at print Q2603, hand a cop of that up. Much of the first five pages, or six pages of the agreement go to what is the background of the matter.

PN272

The interesting part from our perspective sir, goes to, at page 8, heading 3: Principles applicable to my determination, and I think they are the same words that the Commission used in the Ralph M. Lee matter. So rather than quote them in detail, we say, that paragraphs 29 and 30 of the decision are relevantly applied to the matter before the Commission today. What we do draw from that decision sir, is that if there is a question of ambiguity, or uncertainty, in the wording of the agreement, then the appropriate course of action is to make an application to vary the agreement and have the Commission vary the agreement.

PN273

Otherwise, one gets to the situation where if words are to be given a meaning other than their plain English meaning, that we say is likely to be more confusing than the situation we find ourselves in today. We say, sir, that that concludes our view of the case law, and that concludes our submissions, we certainly believe that the intent of the agreement is reflected in the wording and that is the basis on which people have operated for nearly 6 months and as well as the basis on which they have committed to work under the agreement. That would conclude our submissions. We would now seek to lead evidence, first from Mr Peter Kelly.

PN274

THE COMMISSIONER: All right, Mr Kelly. Mr Knuckey you should wait outside.

<PETER JAMES KELLY, SWORN [1.00pm]

<EXAMINATION-IN-CHIEF BY MR COOKE

PN275

MR COOKE: Mr Kelly, could you state for the record your full name and business address please?---Peter James Kelly, business address is c/o Brambles Monadelphous Joint Venture offices on the Burrup Peninsula, servicing the North-West Shelf Project 4.

PN276

And your occupation?---Employee Relations Manager with BMJV.

PN277

And how long have you been in that position with BMJV?---Four weeks today.

PN278

And how long have you been engaged in employee relations more generally?---26 years.

PN279

And what is the nature of your position at - or nature of responsibilities in your position with BMJV on the Burrup?---It is varied, I am there to provide support and advice to the management group. I am also responsible for providing human resources support services and dealing with - and part of that responsibility is obviously dealing with industrial relations matters on behalf of the company.

PN280

What work has been undertaken by the BMJV Joint Venture on the Phase 4 Project?---We predominantly provide logistic support services inasmuch as materials handling, mechanical engineering support services, cleaning and waste management services.

PN281

How many people have you got engaged on that work?---At the moment 150.

PN282

When did BMJV commence work on the project?---4 January 2002.

PN283

When do you expect that the Joint Venture will complete the work on the project?---Well, on what we know today, approximately April 2004.

**** PETER JAMES KELLY XN MR COOKE

PN284

The current number of employees, is that the peak number you expect to have on this project?---Yes, yes.

PN285

Okay. How many advanced level riggers are currently engaged by either of the Joint Venture parties on the project?---We currently - we have 15.

PN286

Is that the peak number you expect to have?---Yes, yes.

PN287

How many advanced level scaffolders does the Joint Venture partners engage on the project?---At the moment there are 12 - sorry, could you repeat that?

PN288

Scaffolders?---Sorry?

PN289

How many scaffolders do you have?---Oh, sorry, no. Well, we don't have a scaffolder as such, we have one rigger/scaffolder who the majority of the work is a rigger but does some scaffolding.

PN290

Okay. Do you expect that you're going to have significantly more scaffolders?---No.

PN291

Do the Joint Venture partners have agreements that regulate the engagement of their employees on the project?---Yes.

PN292

Who are those agreements with?---They're with the AMWU, the AWU and the CEPU.

PN293

And they're certified in this Commission?---That is my understanding, yes.

**** PETER JAMES KELLY XN MR COOKE

PN294

Now, are you aware of clause 5(4)(ii) of the project agreement?---Very well.

PN295

How many of your advanced level riggers are paid the allowance prescribed by clause 5(4)(ii) of the project agreement?---At the moment there are 12.

PN296

So 12 out of approximately 15?---Yes.

PN297

How does that come to be?---Well, what happened, we had to bring some extra employees in for a night shift to clear backlog of work and we lifted - because of that we had to lift the number of advanced riggers with a requirement to supervise others but we haven't as yet re-addressed that, that work is finished. We were going to look at the balance but we thought it prudent not to do so pending the outcome of these proceedings.

PN298

Now, in your view, is the Joint Venture properly applying the allowance prescribed by clause 5(4)(ii)?---Yes.

PN299

Now, when the Joint Venture tendered for the work on the North West Shelf Project did you tender on the basis that the allowance applied on an across the board basis?---No. Absolutely not.

PN300

Now, are you aware of the allowance prescribed by clause 10(2)(b) of Part 2 of the Metal Trades General Award?---Yes. I am.

PN301

Are you aware of either of the companies in your Joint Venture applying that allowance prescribed by the Metal Trades General Award - or how they might apply it on other engineering construction sites?---I'm aware of how - I have been made aware of how it applies previously.

PN302

So you have made some inquiries in that regard?---I have.

**** PETER JAMES KELLY XN MR COOKE

PN303

What advice have you been given?---Much along - of the evidence that you led in regards to the West Angelas Plant Project where the - it did not apply across the board, it was only paid to those people who were required to supervise. The same at Cape Lambert, the high smelt deep construction, no certified rigger - sorry, advanced rigger or scaffolder got the payment because there was a leading hand in place.

PN304

Okay. So are you aware of either of the parties of the companies that make up your Joint Venture applying that Metal Trades General Award provision in a sort of across the board basis on other engineering sites?---No.

PN305

You made inquiries in that regard?---I have.

PN306

Yes?---And the information that came back to me was: no, it is not applied across the board.

PN307

Now, does the BMJV or the constituent parts of the BMJV employ CW5 trades people on the Phase 4 Project?---Yes. We do.

PN308

How many do you employ?---I've just got the number here. We have 12 CW5 employees.

PN309

Now, if the union Metal Workers claim was granted do you see that having any potential impact on the relativities for the CW5 employees on the Burrup?---Most certainly there is potential there.

PN310

In what regard?---Well, inasmuch as the fact is that the relativity has been reduced and it wouldn't surprise anybody if there were claims laid on us to re-address it.

**** PETER JAMES KELLY XN MR COOKE

PN311

Okay. Now, if the Metal Workers claim was granted, would it create any concern for you over the ability to hold the project agreement together for the balance of the job?---Well, very much so. If, out of these proceedings, and the claim was granted, I would see that it would send a clear message out to people that if this agreement - if this party agreement could be bastardised and interpreted that way, then it would open up other claims.

PN312

Now, Mamoot Australia Pty Ltd, they are a sub-contractor to your joint venture?---They are.

PN313

And what work do they do?---They provide cranage and they employ - sorry, they employ some riggers and dogmen, I understand, and supervisors.

PN314

So, are you aware of how many riggers they might engage or they do engage?---They have seven riggers all and told. Five of those are advanced.

PN315

Now, are you aware of those five advanced riggers employed by Mamoot being paid the allowance?---No, they are not because there are two supervisors in place who supervise the crew.

PN316

Okay. That would conclude our evidence-in-chief from this witness, sir.

PN317

THE COMMISSIONER: Mr Saunders?

<CROSS-EXAMINATION BY MR SAUNDERS [1.09pm]

PN318

MR SAUNDERS: Yes, Mr Kelly, you gave evidence that you have had 26 years experience in the field of employee relations?---Yes, in the field of employee relations.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN319

Yes. How many years in the construction industry as an employee relations?---If what we do is seen to be in the construction industry, then it is 4 weeks. But I have had exposure to the construction industry over those 26 years at the workplaces that I worked because of projects that were on those sites.

PN320

Right. So, it would be fair to say it is fairly limited in the construction industry but you have had 26 years in employee relations?---Yes. But I can read and comprehend clauses in agreements.

PN321

Yes. Now, on evidence you said that your company interpreted the agreement that the advanced rigger and scaffolder didn't apply across the board. Is that correct?---Yes, we apply it as it is written.

PN322

Right. And you were there when the negotiations took place for the certified agreement?---No, I wasn't.

PN323

Well, who advised you that is how they interpret it?---Peter Cooke for one who, I understand, was at negotiations.

PN324

So, in the last 4 weeks you have been advised, not since the start of the contract with Monadelphous Brambles?---No. Yeah, in the last 4 weeks.

PN325

Okay. So, in the last 4 weeks Mr Cooke has advised you that is the interpretation of that clause. Is that correct?---Yes.

PN326

Who, in Brambles Monadelphous interpreted it different to that prior to your 4 weeks being here?---I have got no idea. I have got no idea if it as interpreted differently. Our records show that it has been - our pay records show from day 1 that it has been applied as written. But not everyone gets it.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN327

All right. But your evidence says 12 out of the 15 do?---Yes, but we were going to address that number because there is too many holding it. But we thought it was prudent to await the outcome of these proceedings before possibly upsetting the apple cart.

PN328

Sir, I didn't quite get the figures. You have got 15 advanced riggers?---Yes.

PN329

Plus one dual ticketed rigger/scaffolder?---One rigger/scaffolder, yes.

PN330

So, that is 16?---No, he is included in the 15.

PN331

So, it is 15. So, 12 out of 15 receive the allowance?---At this point in time.

PN332

How many other scaffolders or riggers have you got?---You mean, who are not - - -

PN333

THE COMMISSIONER: Non advanced.

PN334

THE WITNESS: - - - advanced? I couldn't tell you that right at the moment.

PN335

MR SAUNDERS: So, there may be none?---There may be none. There might be some. No, there are some. Yes, there are some CW3 level riggers.

PN336

So, basic?---Yes. If that is what is interpreted to be.

PN337

The riggers, advanced riggers, do they sling loads?---As far as I know, they do.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN338

So, if they sling loads, they direct cranes?---I am not sure.

PN339

Well, if they didn't direct the load, who would direct the load after the rigger/slinger?---Well, I have heard discussion that sometimes under the requirement the crane driver can give instruction.

PN340

Who advised you that?---A crane driver.

PN341

Yes.

PN342

THE COMMISSIONER: Different animal.

PN343

MR SAUNDERS: Are you aware of the Act?---Which Act?

PN344

The Occupational Health and Safety Act or even the Mines Regulations Act?---Yeah, I am aware they exist.

PN345

Yes. And of course maybe to assist, the Act makes it clear that directing a load needs a certified person?---If you say so, yes.

PN346

And that certified person could be a dogman or a dog person as they call them these days or a rigger or if it is in the sight of a crane driver, it could be a crane chaser. You are not up with that, are you? You are not sure of the Act, are you?---Not in that regard, no.

PN347

No. So, you are not sure whether riggers direct loads or not?---I couldn't say 100 per cent that they direct loads. But they must supervise something because we wouldn't be paying them to do so if they didn't supervise the work of one or two others. Whether that includes the supervision or the actual slinging, I am not sure.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN348

Prior to night shift, how many advanced riggers did you have on the project?---I think in total there was about 17.

PN349

So, prior to night shift there was 17 advanced riggers?---I am not 100 per cent sure. I think that was the figure.

PN350

And out of those, how many were paid the allowance?---I think it was about ten.

PN351

And how many people were employed on night shift?---Well up, approximately 30 or 32 approximately. Once again, I am not 100 per cent sure on that.

PN352

And what were their duties or their tasks?---Various. Predominantly - I think it was predominantly rigging. There were general hands, labourers, in the yards.

PN353

Were they moving material?---Yes.

PN354

Were they using cranes?---Yes.

PN355

Were they doing scaffolding?---I am not sure. I don't know.

PN356

Were they doing welding?---I don't know. At that stage, I had only been there about a week and I was still finding my feet which I still am.

PN357

So, you not sure what the riggers were really doing, were you?---No.

PN358

You gave evidence about West Angelas, is that correct?---I just referred to the agreement, that there was a clause in that agreement that was similar to what we the issue is about here.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN359

Yes. And do you recall what the clause says?---West Angelas?

PN360

Yes?---

PN361

A certified rigger, other than a leading hand, who is responsible for the supervision of other employees, shall be deemed to be a leading hand and be paid the additional rate prescribed.

PN362

And in your opinion, seeing you interpreted the clause in the North West Shelf Agreement, what is the difference between that and the North West Shelf Agreement?---There is other language. The North West Shelf Agreement refers to riggers and scaffolders and makes reference to the Occupational Health and Safety Act.

PN363

It goes further than that, though. This talks about certified riggers, not advanced riggers?---Well, a certified or certified scaffolder with an advanced certificate of competency.

PN364

No, in the Monadelphous Engineering for West Angelas it talks about a certified rigger which could be a basic rigger. Correct?---I suppose it is open for that to be interpreted that way, I suppose, yes.

PN365

Well, is a basic rigger a certified rigger?---I wouldn't have thought so.

PN366

Is a dog person a certified person?---

PN367

THE COMMISSIONER: A dog man or dog lady.

PN368

MR SAUNDERS: Yes, well, I am trying to be non-sexist. It is pretty hard when you get to a dog person.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN369

MR COOKE: Call them dogs.

PN370

MR SAUNDERS: Is a dog man a certified person?---I couldn't tell you that.

PN371

Right. So, you are not sure. You don't know?---No, I am not sure.

PN372

That is fine. Well, let me put it to you that a basic rigger is a certified person. Same as a dog person is a certified person. So, the provisions - - -

PN373

THE COMMISSIONER: They have their dog licence.

PN374

MR SAUNDERS: Something like that, Commissioner.

PN375

So, a person who, under the Monadelphous Agreement of West Angelas, a basic rigger who may supervise a TA for whatever person gets paid an allowance and that allowance is a leading hand allowance. Would you interpret it that way?---If they were required to supervise any other employee, right, then this says they are entitled to an allowance as the additional rate prescribed. Now, the additional rates prescribed is a minimum in this agreement of not less than 3 and not more than 10. I suppose it is then open to discussion that given that that is the minimum prescription in there, if somebody is only supervising one or two, they might not get paid anything.

PN376

Let's go through the clause:

PN377

A certified rigger other than a leading hand -

PN378

so it is qualified. It is not a leading hand -

**** PETER JAMES KELLY XXN MR SAUNDERS

PN379

who is responsible for supervision -

PN380

so - - - ?---"Of other employees".

PN381

Well, hang on. I put to you that a basic rigger may supervise a TA to collect ropes or to collect shackles -

PN382

of other employees shall be deemed to be a leading hand and paid the additional rate prescribed.

PN383

And that is the rate that is prescribed in the agreement. So, I put to you, under this agreement a basic rigger who may be directing a TA will get paid a leading hand's rate?---

PN384

THE COMMISSIONER: What if he is supervising less than 3? There is no rate prescribed.

PN385

MR SAUNDERS: No. What it says that he will get paid it.

PN386

THE COMMISSIONER: No. It says he:

PN387

... shall be deemed to be a leading hand and be paid the additional rate prescribed.

PN388

So which rate do you pay him?

PN389

MR SAUNDERS: Well, it could be the higher rate but I would say it would be the lower rate.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN390

MR COOKE: Perhaps it is ambiguous.

PN391

THE WITNESS: Well, that is why I made the point.

PN392

THE COMMISSIONER: Now, that one is open for interpretation?---Well, I just made that point that you could look at it that way.

PN393

MR SAUNDERS: So, really, you could say that that is superfluous. If that is the case, it means nothing. What it says, in all honesty, and how that is interpreted - well, Mr Kelly doesn't interpret it that way by the look of things. It is says that a certified rigger and a qualifying - other than leading hand so he can't double up who goes and supervises other employees shall be deemed to get paid the leading hand allowance, whether that be one person or five people. But the basic difference there is - sorry, I should ask you. That is a completely different provision that applies in the North West Shelf Project Agreements, isn't it?---Certainly it is a differently worded clauses, yes.

PN394

And leaving aside the Commissioner's interpretation - - -

PN395

THE COMMISSIONER: My observation.

PN396

MR SAUNDERS: Or observation. That is probably a better way of putting it. Then the second part to that, if my submission is correct, then that certified rigger, and in my example the basic rigger, would get paid the leading hand allowance. Is that correct?---That is if you are correct.

PN397

Well, if he gets paid an allowance, it is the leading allowance. If I can put it that way to you. If he gets paid anything, he gets paid the leading hand allowance. Is that correct?---Well, once again, I come back that it could be interpreted that if it is only one or two people, that person might not get paid anything.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN398

All right. If he got paid anything, does he - I could stay here all day and argue this. If he was to be paid anything, what amount would he be paid?---Well, I would assume that he would be paid in accordance with the provisions - the leading hand allowance as prescribed.

PN399

Okay. Which is different to the North West Shelf Agreement, isn't it?---Yes.

PN400

Because the North West Shelf Agreement says he gets less than the leading hand's allowance. Is that correct?---Yes. Because it is - my understanding, it is pitched at - in a situation where they are required to supervise one or two people. If they are supervising three or more, they would get the appropriate allowance.

PN401

In the Cape Lambert Agreement, in similar terms but, again, it talks about certified riggers and scaffolders?---Yes.

PN402

So, again, I put to you that it is a different provision that applies in the North West Shelf Agreement on the basis if an allowance was to apply, then it would be the leading hand allowance?---If that is what it says, yes.

PN403

All right?---But the intent is still the same, isn't it, right across? They must be supervising somebody.

PN404

Yes. But you are right, the intent is the same, that they all get the leading hand allowance if an allowance applies. Now, if I take you to the North West Shelf Agreement. And if we go to the provision in question. Sub-clause (b)(2)?---Yes, I have got it here.

PN405

And this provision is different, isn't it? I mean, this provision says even if you are supervising one or more, then you don't get the leading hand allowance. Is that right?---Yes. It accommodates for those who supervise one or two people.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN406

Right. Yet those agreements which we identified, the Cape Lambert and West Angelas, it says that they do, if it applies. They get - - - ?---Yeah. What is your point?

PN407

Well, we will get to the point. Don't worry, Mr Kelly. We will get to the point. The position is that in those agreements there is a provision that applies that the leading hand allowance is the applicable rate, yet in this agreement it says they don't. They get a lesser amount. Have you questioned why? Did you question Mr Cooke why that - after he told you that is the way it operates? Why would they get a lesser rate?---Well, my understanding is because - it is recognised that there may be occasions where people may need to supervise one or two. Right? And this is the allowance that was agreed on for that happen. If they are supervising three or more or upwards, they get the appropriate leading hand allowance.

PN408

All right. Let's go to the award. Under clause 10. Part 2, clause 10(2)(b)?---Yes.

PN409

It says:

PN410

A certified other than a leading hand in compliance with the provisions of the regulation made pursuant to the Construction and Safety Act of 1970 who is responsible for supervision of other employees shall be deemed to be a leading hand and paid the additional allowance prescribed for a leading hand placed in charge of not less than 3 and not more than 10.

PN411

It is quite prescriptive, isn't it? It tells you?---Yes.

PN412

So, if he supervises one, what does he get?---Well, once again, it could be interpreted he gets nothing. Because this is specific. It says, "Not less than 3 and not more than 10".

**** PETER JAMES KELLY XXN MR SAUNDERS

PN413

No, no. Look - - - ?---There is no provision there to accommodate less than 3.

PN414

"Shall be deemed - - - "

PN415

THE COMMISSIONER: Shall be deemed.

PN416

MR SAUNDERS:

PN417

shall be deemed to be a leading hand and shall be paid an additional rate prescribed for.

PN418

Right? And it sets out the rate?---Yes.

PN419

Right? Above that it says:

PN420

is responsible for supervising of other employees

PN421

?---Yes.

PN422

Right? So, that could be one, two, three? It could be two?---Yes.

PN423

THE COMMISSIONER: It could be two.

PN424

THE WITNESS: It could be - yeah, you could certainly look at it that way.

PN425

MR SAUNDERS: Yes. And what would he receive?---Well, if your contention is correct, then he would get the allowance that is prescribed for not less than 3 and not more than 10.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN426

Yes. So, in other words, a person who is supervising others who are in the North West Shelf Agreement, he may supervise one or more - - - ?---One or two, yeah.

PN427

Well, no. I put to you - I shouldn't put anything to you. But the position is that he could be supervising five. What would he get paid?---If he was supervising five - right?

PN428

Yes?---Well, I would have thought, if he was supervising five, he would get paid the prescribed leading hand rate for that number of people.

PN429

Well, I would suggest you read your agreement because that may not be correct. If he hasn't been appointed in writing, he is not a leading hand?---Well, I assumed that that would have happened.

PN430

No, that wasn't the question. What I put to you is that what it says is, one, that he doesn't have to be. He could be supervising one or more and he gets a rate of pay. It is very different to what it says in clause (4):

PN431

In addition to the appropriate total wage prescribed in this clause, a leading hand appointed in writing as such by the employer shall be paid

PN432

?---Well, my - from the information passed onto to me, that is not the way it has been applied. If we appoint you as a leading hand, right, you will get paid the appropriate allowance depending on how many people you are supervising as a leading hand.

PN433

No, your evidence was if you were supervising five people you would be paid as a leading hand. That is what your evidence was?---Well, I assume if we wanted people to do that, we would be appointing them as leading hands formally.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN434

That is fine. No, it wasn't your evidence. Your evidence was that if a person was looking after - - - ?---Well, if you have misunderstood my answer, I have just clarified it.

PN435

THE COMMISSIONER: I should imagine, Mr Saunders, if they had an advanced rigger or scaffolder supervising five or more than five, or more than three, and paid them $20 a week allowance, you would be onto them like a ton of bricks, wouldn't you?

PN436

MR SAUNDERS: No doubt I would. I was just checking out to see what they were doing up there.

PN437

THE WITNESS: My understanding is it is clear that this clause is to catch those people who are required to supervise one or two people.

PN438

MR SAUNDERS: Well, I put to you that the clause itself is written in such a way which is different from those that you gave evidence on, such as Cape Lambert and West Angelas, where it purports to pay the leading hand's allowance. Under this agreement, then it pays a lesser allowance and the question I asked you, have you asked Mr Cooke who instructed you on this, why is it the case. And you haven't asked that question of Mr Cooke and you can't answer it. But that is a completely different structure, a different pay structure. It is a new pay structure that was negotiated at the time of the agreement. And on your evidence which is correct that you weren't party to those negotiations, so you are not sure what the construction of that clause was?---Well, no, I wasn't at negotiations. But I would have thought if what was meant is something else that isn't here, then I am surprised your union signed the document.

PN439

You said that at conference. You said that at conference. Maybe we don't sign any more documents and see how we go.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN440

THE COMMISSIONER: They might do a deal with the other mob.

PN441

MR SAUNDERS: Sorry

PN442

THE COMMISSIONER: They might do a deal with the other mob.

PN443

MR SAUNDERS: They might. They might too. They wouldn't be arguing in the courts about this.

PN444

Prior to your employment being appointed or employed 4 weeks ago, who had the role of Employee Relations Manager?---There wasn't a role of Employee Relations Manager. There was an Employee Relations Adviser there.

PN445

And who was that?---Nigel Palmer, who is still there.

PN446

Have you spoken to Mr Palmer about this provision?---Yes.

PN447

And what was his thoughts about that?---Well, of course, I asked the history of it and how we had been applying it. And he advised me that we have been applying it the way it is written. And that the pay records support that.

PN448

The dual ticket of rigger/scaffolder, does he get paid the allowance?---No.

PN449

He doesn't get paid the allowance?---No.

PN450

Does he do scaffolding work?---He does some, I understand. He supervised it.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN451

So, he built scaffold by himself?---I would have thought not. He would get assistance at some stage.

PN452

So, he wouldn't advise or use his ticket to build the scaffold?---Well, obviously if he was required to supervise others using - you know, well, what the interpretation of supervision is, if he was required to do that, he would get it.

PN453

But you say that he doesn't get the allowance?---No, he doesn't.

PN454

And he builds scaffold?---Yes.

PN455

And you know under the Act it is one person in three supervises other scaffolders?---Well, - - -

PN456

It is his licence that is the appropriate thing here?---Yeah. Well, you have got me at a disadvantage. You obviously know the Act better than me.

PN457

Well, I will take it up with Randalls or Monadelphous or whoever employs him because it is obviously one that needs to be addressed. He receives the allowance under any interpretation?---Well, if that if - certainly, if that is the case, then we will rectify it. But on the information - I asked the question, does this particular chap receive the allowance? The answer given to me was, no. If he should be getting that allowance and it is quite he should be getting that allowance, he will get the allowance.

PN458

Yes, well, it was very clear. Now, you said that there was 17 advanced riggers before night shift?---Yes.

PN459

Your evidence is now that there is 15. You say we have had some terminations, lay-offs?---Well, at peak we had 24. Seven were demobilised. And that brought us back down to 17. And, yes, there has been two that have left.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN460

And 12 out of the 15 receive the allowance and we have heard in evidence one of those is an advanced scaffolder?---Yes, he is advanced rigger/scaffolder, yes.

PN461

Yes. But let's use him as the advanced scaffolder. So, now it is 12 out of 14. You are not sure of the duties, is that correct? Of all their duties?---No, I am not.

PN462

And you are not aware whether these workers may direct cranes or work around the project?---I could not give you a comprehensive job description of what they do. Because I haven't been there that long and I am still finding these things out.

PN463

Are you aware of Commissioner Watson's decision in the building trades matter? Variation to their award?---No, not - I - - -

PN464

THE COMMISSIONER: Commissioner?

PN465

MR SAUNDERS: Commissioner.

PN466

MR COOKE: Deputy President.

PN467

MR SAUNDERS: Deputy President, sorry.

PN468

THE COMMISSIONER: Watson?

PN469

MR SAUNDERS: Watson.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN470

You are not aware of the decision he made for the National Building Trades Award on relativities?---No.

PN471

So, you would accept that if I put to you that he moved riggers and scaffolders to 100 per cent, the same as trades, you wouldn't deny yes or not to that, would you?---Well, I couldn't say yes or no.

PN472

No. Okay. You gave evidence that you believe that the relativities would be disturbed if this allowance applied across the board to advanced riggers or scaffolders. Is that correct?---Yeah, there is a concern there that even though it is not a direct wage increase, it could be perceived by others to be a direct wage increase and it could have impact on the relativities, yes.

PN473

Have you spoken to the trades people up there?---Not as yet, no.

PN474

So, you don't know whether it is a concern?---I said it had potential.

PN475

But you don't know. You envisage. You haven't been to the trades people to find out whether they have got concerns or not?---No, because it is a bit premature until we see what happens in these proceedings.

PN476

Has there been industrial action because 12 out of 15 receive the allowance now?---Can you - sorry, what was the question again?

PN477

Your evidence is 12 out of the 15 receive the allowance now?---That is correct.

PN478

Has there been industrial action by the trades people?---Not to my knowledge.

PN479

Have they lodged a grievance?---Not to my knowledge.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN480

So, the evidence is that at this stage the trades people accept, at least those 12 people which receive the allowance - hasn't disturbed the relativities. Is that correct?---Not as yet. But I also led in evidence that depending on the outcome of this - we don't need 12 advanced riggers to be supervising others.

PN481

Give a hungry dog bone and take it off them. We know what is going to happen. But that is up to you. But what I am putting to you is that there has been 12 people on the project now or since you have been there in the last 4 weeks - in fact, I think your evidence was there was 17 at one stage, wasn't there who received the allowance?---No, there were 17 advanced riggers.

PN482

Okay. And there was 15 advanced riggers who used to receive the allowance?---No.

PN483

On night shift. When you had the night shift running. And your evidence is now that there is 12 out of 15?---No, when there was 24, right, I think - - -

PN484

All right, I will accept - - - ?---I am just trying to think of - but there was - - -

PN485

I will accept that there is 12 now out of 15 advanced riggers or scaffolders. In fact, there is 12 advanced scaffolders?---No, there is not 12 advanced scaffolders.

PN486

Sorry. There is 12 advanced scaffolders receiving the - - -

PN487

THE COMMISSIONER: No, riggers.

PN488

MR SAUNDERS: Sorry. Riggers receiving the money out of 14 - - - ?---Out of 15.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN489

Out of 14 advanced riggers and one dual ticket rigger/scaffolder?---Yes.

PN490

And the question I have asked is has that disturbed the relativities or caused disputes on the project?---It hasn't caused a dispute to this time.

PN491

And how long has that been going on for, the 12 people out of 15?---I couldn't tell you. It all depends on when they started, when they were required to supervise. It would be a mixed bag, I would suggest.

PN492

In the last 4 weeks?---Beg your pardon?

PN493

At least for the last 4 weeks since you have been there?---That they have been receiving the allowance?

PN494

Yes?---Yes.

PN495

Yes. So, it is 4 weeks or longer?---Yes, with some of them.

PN496

Okay. And you gave evidence that there is seven advanced riggers with Mamoot?---No, there is five advanced riggers and two intermediate.

PN497

And I think it was your evidence that the five advanced riggers didn't receive any allowance?---That is correct. There is two supervisors who supervised those people.

PN498

And are the supervisors certified riggers?---I couldn't tell you that.

PN499

Do those riggers direct the cranes?---I couldn't tell you that.

**** PETER JAMES KELLY XXN MR SAUNDERS

PN500

If they directed cranes and loads would they be entitled to the allowance, in your opinion?---Well, it would certainly warrant investigation, wouldn't it, if they did, to see if they do qualify.

PN501

Well, would they be supervising other people?---I'm not sure whether that falls under the bailiwick of direct supervision or something that they would do in the normal course of their job.

PN502

So who would direct you to how it should apply? I mean, if you don't know now you'll have to gave to get some direction from somewhere, who would you go to?---I'm not sure at the moment I'd have to think about who I thought would be the appropriate person.

PN503

Wouldn't you go to Mr Cooke like you've been to already?---Oh, I would assume I would probably include him in the people that I would talk to.

PN504

Maybe I should ask Mr Cooke about how he would - - -?---Yeah.

PN505

No further questions.

PN506

THE COMMISSIONER: Right. Mr Cooke?

PN507

MR COOKE: No re-examination, sir.

PN508

THE COMMISSIONER: You can step down, Mr Kelly.

<THE WITNESS WITHDREW [1.45pm]

PN509

MR SAUNDERS: I call Kevin Richard Knuckey, please.

<KEVIN RICHARD KNUCKEY, SWORN [1.45pm]

<EXAMINATION-IN-CHIEF BY MR COOKE

PN510

MR COOKE: Could you please state to the Commission your full name and business address, please?---Kevin Richard Knuckey, business address: care of United Construction - or United KGs it now is, Mandurah Road, Kwinana.

PN511

And your occupation please, Mr Knuckey?---I'm a civil engineer and I'm working as project manager for United KG on the LNG 4 Mechanical Off Plot.

PN512

And how long have you been with United KG?---I joined United KG in September 1994, so that's eight years.

PN513

And how long have you been in the position of being project managing the LNG 4 Contract?---Since award the contract which was 21 June 2002.

PN514

And in the overall sense how long have you been engaged in construction and heavy engineering?---Virtually since I graduated in 1975, so it's 27 years.

PN515

And what is the nature of the responsibilities of your position?---Well, as the project manager I'm virtually the fully responsible person for United KGs activities on the LNG 4 Off Plot contract.

PN516

And your formal qualifications, Mr Knuckey?---I have an associateship in civil engineering, graduate diploma in business and administration and I'm a fellow of the Institute of Engineers.

PN517

And the work that United KG are undertaking on the Phase 4 project?---We're doing all the structural erection, mechanical erection and piping erection for all of the off plot work.

PN518

On the Phase 4 project?---On the Phase 4, sorry, yeah, on the Phase 4 project.

**** KEVIN RICHARD KNUCKEY XN MR COOKE

PN519

And how many people are currently engaged in that work?---The workforce currently at the last count was 98.

PN520

And when did UKG commence work on the project?---Management arrived on site on 16 September and work actually started on 1 October.

PN521

And when do you expect your work will be completed on the project?---The current schedule practical completion date is 26 September 2003.

PN522

And when - how many people do you expect will be engaged on the project for UKG when your peak workforce is there?---For the mechanical off plot it will be about 270, around about April 2003.

PN523

Is there any likelihood of you obtaining further work on the project?---Yes, we haven't been awarded it yet I understand but we are certainly close to being awarded the TOT we believe. The TOT is the Trunk Line Onshore Terminal.

PN524

And that will increase the number of people that you will engage at peak?---Yes, that will take us up to around about 450.

PN525

So almost another 180 odd?---Yes. As one section of the work winds down the other one winds up, so it balances out to a total of around about 450.

PN526

How many advanced level riggers are employed by UKG in the project currently?---Advanced level riggers there's currently 28.

PN527

And assuming the - if the TOT work was to proceed how many advanced level riggers would you UKG employ on the project at peak?---On - with the TOT and the off plot together would be approximately 130.

**** KEVIN RICHARD KNUCKEY XN MR COOKE

PN528

And the number of advanced level scaffolders you would employ at the moment on the project?---17.

PN529

And again how many advanced level scaffolders would you have at peak on the project, assuming all - - -?---Including the TOT that would be approximately 90.

PN530

And you have in place agreements regulating the engagement of new employees on the project?---Yes, we have a - well part of the PLA as it's called, Project Labour Agreement which is United KG is a part of. I have to look here I could find you the exact title, the North West Shelf Project United KG Pty Limited Phase 4 Agreement 2002.

PN531

Now you are aware of clause 5(4)(ii) of the project agreement?---Yes, I am.

PN532

Now of your advanced level riggers how many are paid the allowance prescribed by clause 5 subclause 4?---Advanced level riggers, none.

PN533

And how many of your advanced level scaffolders are paid that allowance?---Five.

PN534

Now in your view is the UKG properly applying that allowance?---My view is clearly yes.

PN535

Now the basis of the wording of the allowance in the agreement, is that the basis on which UKG tendered for the work on the North West Shelf Project?---Yes, that was our understanding at the time of tender.

PN536

And that is the way, the basis of requiring people to have the qualification to supervise others, that is the basis on which you are applying it currently?---That's how we're applying it at the moment, yes.

**** KEVIN RICHARD KNUCKEY XN MR COOKE

PN537

Now you are aware of a similar allowance found in clause 10 subclause 2(b) of part 2 of the Metal Trades General Award?---Yes, I have looked at it several times.

PN538

Have you ever been in charge or been engaged in projects, Mr Knuckey, that worked under the Metal Trades General Award Part 2?---Yes, I have.

PN539

What sort of other projects have you been engaged in where that award had some currency?---Yes, the ones that spring to mind are the Cape Lambert Upgrade, Adelaide Brighton Cement Project - there's many others over a long period of time.

PN540

Now are you aware of UKG applying that allowance prescribed by clause 10 to their part 2 of the Metal Trades Awards on a sort of across the board basis on other projects?---No, I'm not, no.

PN541

Are you aware of UKG applying it on other projects and not making it contingent upon being responsible for other employees?---No. My understanding is that it relies on somebody supervising others.

PN542

Now UKG currently employ metal trades people on the Phase 4 project?---Yes, we do.

PN543

And how many do you employ?---Looking at the numbers that I've got in front of me at the moment just to make sure I get the right numbers, we've got another 19 metal trades people on the project other than the numbers already suggested.

PN544

Now do you believe that there is a potential issue if the metal workers claim is granted in relation to the relativities of the trades people on the LNG 4 project?---Without trying to second-guess the workforce I would believe that that's a potential problem, yes.

**** KEVIN RICHARD KNUCKEY XN MR COOKE

PN545

Now have you turned your mind, Mr Knuckey, to what the potential cost to UKG would be if the metal workers claim was granted to apply this allowance across the board?---Just doing an exercise on our current scope not including the TOT at this point in time, my estimate was around about 130,000.

PN546

And if you included the TOT in that in ball parks terms you would - - -?---You would have to close to double it.

PN547

Okay. Now in terms of trying to deliver the project you have the project agreement remain intact through the life of the project, if the claim is granted would that create any concern in that regard for UKG?---Well, obviously it's - it creates a financial concern but it also, I mean, it would create a lot of concern as to the, I suppose, the long term validity of the project labour agreement.

PN548

That concludes the evidence-in-chief, sir.

PN549

THE COMMISSIONER: Mr Saunders?

<CROSS-EXAMINATION BY MR SAUNDERS [1.54pm]

PN550

MR SAUNDERS: Yes, Mr Tuckey. Contractual arrangements with the client. Are you on a lump sum contract?---You would define it potentially as a lump sum contract. I mean, it's got a whole range of associated bonuses depending on productivity and completions and so forth. Both bonuses and penalties, if you like.

PN551

Well, would you describe it closer to a schedule of rates contract?---It's probably closer to a rates contract in reality but you know, it's a measured quantity so eventually the reality is it becomes lump sum.

PN552

Yes?---And there are a range of fixed fees associated with it.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN553

But, for example, the people who did the civil work which was John Holland's for the Off Plot, they were - had different contractual arrangements as you understand?---I'm not familiar with John Holland's contractual arrangement at all.

PN554

So you don't know whether they are on schedule of rates or lump sum?---No.

PN555

Right. You gave evidence that you believed if the union was successful in having the Commission determine the clause in the enterprise agreement was to be applied in the manner which the union is putting that that would cause problems with your trades people. Is that correct?---Well, potentially.

PN556

Yes. You had a meeting with the trades people?---Not specifically about that issue, no. Not specifically.

PN557

So you don't know, do you?---This is my impression.

PN558

So it is your summation?---My impression.

PN559

No hard evidence?---My impression.

PN560

Okay. And you pay five scaffolders - sorry, your evidence is you pay five advanced scaffolders the allowance at the moment?---That's right.

PN561

And why do you pay them the allowance?---Because they lead the groups they are in. They get two ticks in the box, they're advanced scaffolders and they are leading, supervising the groups that they're in.

PN562

Okay. So which allowance do they get?---The advanced scaffolders' allowance.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN563

So they don't get the leading hand allowance?---No, because they're not - they did not supervise in groups of six or seven or eight or groups of above three, they're only - our scaffolders are arranged in groups of three and they would be that leading person in that group and therefore looking after and supervising the other two.

PN564

Yes. If you only had one advanced scaffolder and you had other people, could be even TAs, who may assist in scaffolding would he be - in your opinion, would he get the allowance?---I'd have to consider the exact that he is undergoing but if he was supervising other work that he was qualified to supervise, ie he had one or two TAs working with him and he was doing the scaffolding that's potentially possible.

PN565

Well, he would be building scaffold on his ticket, wouldn't he?---Yes.

PN566

On that basis he would be - - -?---If he's an advanced scaffolder if he gets two ticks in the box I'd certainly be looking at that, that's what the clause says. If he gets a tick in the box for the advanced scaffolder, if he gets a tick in the box for supervising people then that's two ticks, he - that rate should apply.

PN567

But he may also apply for leading hand's allowance, wouldn't he?---Again if he was in a scaffolding group they were generally working in two or three, in which case he would be getting the advanced scaffolder's allowance if he got those two ticks. If he was leading hand supervising a whole group of other people, then certainly that's potentially possible he could go to a leading hand arrangement.

PN568

Yes, but a leading hand arrangement is that it says "if placed in charge of not less than three and not more than six"?---Yes.

PN569

So on the basis that he may be - - -?---He could get the leading hand allowance three to six.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN570

Yes. Okay. Now the people who, the other 17 scaffolders, sorry there was 17 advanced scaffolders wasn't there?---That's right, yes.

PN571

Have you got any other scaffolders?---We've got one intermediate I believe.

PN572

Okay. But in the main they are all advanced?---In the main they're advanced, yes.

PN573

Right. And then you've got the five advanced scaffolders supervising advanced scaffolders, is that right?---Yes, that's right, the leader of that group.

PN574

Wouldn't it be more appropriate that they may be leading hands?---No, because they're not supervising groups of three or more.

PN575

So you - - -?---So they're in a group, they're in a scaffolding crew and the scaffolding crew consists of three.

PN576

Yes. So in effect, you've looked at a provision in there where you put people in charge and you are applying a provision respectively I would say a leading hand's position to be honest with you?---I'm only reading what I see there and interpreting what I believe is correct.

PN577

Yes. Did you take any advice on how you applied the provision?---Well, from my own HR person, Jodie Wilsley, yes.

PN578

Did she take advice from someone else?---She - she's in that profession, yes.

PN579

Yes.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN580

THE COMMISSIONER: The finger all points to Mr Cooke, doesn't it?

PN581

MR COOKE: All roads lead to - - -

PN582

MR SAUNDERS: I was going to cover - I won't go to issues - a secondment problem.

PN583

THE WITNESS: She works for me at his point in time.

PN584

MR SAUNDERS: Yes. The plot thickens.

PN585

MR COOKE: I was there in '63 in Dallas too.

PN586

THE COMMISSIONER: On the "grassy knolls".

PN587

MR COOKE: That is the one.

PN588

MR SAUNDERS: In evidence Mr Cooke, exhibit C6 submitted:

PN589

United Construction Pty Limited Cape Lambert Metal Trades Certified Agreement.

PN590

Submitted subclause 3.32: Certified Rigger Allowance. In your evidence you said that you were project manager for that one?---Yes. I wasn't on site all the time but I was on site significant portions of the time.

PN591

Are you aware of the provisions certified rigger allowance?---I'm aware of that clause that you're talking about, yes.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN592

Yes?---Without being specifically aware of every detail in it at this time without checking it.

PN593

If I read it to you:

PN594

A certified rigger other than a leading hand who is responsible for supervision of other employees shall be deemed to be a leading hand and paid the additional rate prescribed.

PN595

And I put to you that it's certainly different, talks about only riggers, talks about - it doesn't talk about advanced certified riggers it just talks about certified so they could be basic, intermediate or advance. Is that correct?---Mm.

PN596

The next one, qualifies other than a leading hand because a leading hand allowance would apply. It says:

PN597

Who is responsible for supervision of other employees shall deem to be a leading hand and paid additional rate prescribed.

PN598

So if he was a certified rigger, whether it be basic, intermediate or advanced was put into a supervisionary capacity he would receive - whether that be one person, two or whatever, he would receive the allowance. Is that how you would interpret that?---That's possibly correct, yes.

PN599

Yes. Well, you were looking after the project, is that how you interpret it?---I was never actually directly called on to interpret any one of the guys that were up there, there was no issues as a result of what we were paying the guys. I believe there was two or three people we were paying that kind of allowance to under that agreement.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN600

As leading hands or as people in charge of one, two or three - - -?---I'd have to specifically go and check, Colin, I wouldn't be sure.

PN601

Yes. You gave evidence - well, just on that, yes, you are not sure but you - - -?---I believe that's the case.

PN602

And you are not too sure how many advanced riggers or scaffolders or how many riggers or scaffolders you had there, I think?---Not in Cape Lambert, no.

PN603

And of course it didn't matter for the scaffolders, again it was only riggers who got it. You gave evidence that you also and I think you were project manager, Adelaide Brighton Cement?---Yes. Well, yes, Adelaide Brighton Cement as it's known, was shifting Swan Cement down to Kwinana, yes.

PN604

And you gave evidence that you believed that the award provision applied on that project, is that right?---I believe so.

PN605

In what context did it apply? Did it apply because the certified agreement was underpinned by the Metal Trades General Award?---As I understand it, yes.

PN606

And are you aware on that project how - if it was applied at all?---I'm not aware of it actually being applied at all.

PN607

But it could have been applied?---I'm not aware of it being applied at all.

PN608

But it could be applied?---If that was the circumstance that someone was working on it should have been applied.

PN609

Yes?---And as I say, there was no issues arising so I - - -

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN610

So everyone could have been on it?---It's possible but unlikely.

PN611

Yes.

PN612

They're the two projects you gave evidence on and you did a broad, across the board that is, others but you didn't name any others did you?---No, I didn't name any others.

PN613

You haven't given any detail of - - -?---No.

PN614

The costing of 130,000 estimated it will cost, that is from the date you arrive on the project to the date that you leave ....., is that correct?---That was a global - yeah, global estimate, yeah.

PN615

Global estimate. And that is saying that you will employ up to 130 advanced riggers and - - -?---Sorry, that was not for TOT.

PN616

No?---So the 130,000 did not include the TOT. So therefore the number of riggers and scaffolders on that job was not 130 it is less. It is about 70, 60.

PN617

Sorry. I didn't get that?---100 - - -

PN618

So it is 70 advanced riggers?---Yeah, that is right.

PN619

And how many scaffolders?---60 - 60 advanced riggers and currently 40, not current, would be 40 scaffolders.

PN620

Forty?---So that would lead to the 170 - $130,000 figure.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN621

So it is an extra 32 advanced riggers and 23 advanced scaffolders?---Yeah, approximately.

PN622

How many other scaffolders would you have?---How many other scaffolders?

PN623

Yes. Other than advanced scaffolders?---At this point in time we are targeting advanced scaffolders. Where we end up I'm not absolutely sure, in terms of what is available in the community.

PN624

So those figures may be way out?---In terms of number of scaffolders, no, they won't be way out.

PN625

No, not numbers but their qualifications?---At this point in time we are going - we are targeting advanced scaffolders.

PN626

Yes?---Mm.

PN627

But if you can't get advanced scaffolders you will get intermediate scaffolders, won't you?---We may have to work in that area but we are targeting advanced scaffolders.

PN628

Right. Why do you target advanced scaffolders?---Because that is what the requirement to have on site, that that level is the competency testing that goes with it.

PN629

What is the difference between an advanced scaffolder and an intermediate scaffolder, do you know?---No.

PN630

So someone is directing you to target advanced scaffolders?---Yes, someone is directing us to target advanced scaffolders as well as - as well as we are directing ourselves to target advanced scaffolders.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN631

On the COMPLOTs is there swing stage scaffolding?---You would have to define swing stage scaffolding to me Colin.

PN632

Swing stage is where it is not coming off the ground, it is on - forgotten the name of the term, it comes out from the side of the structure?---We have got that kind of scaffolding on site.

PN633

How much?---Lots.

PN634

Lots. Determine lots?---Sitting alongside the 66E pipe rack we would probably have 300 to 400 metres of it eventually. I would call that lots.

PN635

How would that compare with other scaffolding?---In terms of quantum?

PN636

Mm?---That is a significant portion of our overall scaffolding requirement.

PN637

So there won't be - - -?---That is an area I would certainly be wanting good scaffolders.

PN638

An area you would need advanced scaffolders. Don't get me wrong?---Absolutely.

PN639

Intermediate scaffolders can't do that work?---Absolutely.

PN640

And advanced riggers, why do you target advanced riggers?---Because we've got a lot of - a lot of gear to put in all sorts of places around the place, yeah. Like, I mean, yes, we want good riggers.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN641

You know - - -?---Like, I mean, yes, we want good riggers.

PN642

So we target advanced riggers.

PN643

Do you know the difference between advanced riggers and advanced - - -?---No.

PN644

And intermediate?---Not by - not by strict qualification, no.

PN645

Yes. So it is not a matter of the skills the person requires or the certification someone's directed you to try and get the - - -?---No, it is a combination.

PN646

Well, if an intermediate rigger can do everything other than do - - -?---As I said, it is a significant portion of our job.

PN647

Yes, but you don't know the difference between the qualifications?---I don't need to.

PN648

So it is only because they've got the advanced. It is not the skills?---It is because it is the requirement of the project we're working on.

PN649

Yes. So someone's - - -?---No, no, no. That is not what I said.

PN650

Well, someone's directing you to - - -?---No, it is the requirement of the project we're working on, it is not the direction.

PN651

If you don't know what the difference is, you don't - - -?---I don't - I don't need to. I have people who do know what the difference is, yes.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN652

So if I said to you why can't you employ advanced - sorry, intermediate riggers, who have got these - - -?---I wouldn't give you a definitive answer, no.

PN653

Yes. Who would give you that answer?---Perhaps my scaffolding or rigging superintendent or my construction manager.

PN654

Yes. Right. And I would expect they would know the difference between - - -?---I would expect that they would know the difference.

PN655

And if they don't, they shouldn't be there I would suggest?---I would have that expectation.

PN656

And you said that out of the 28 advanced riggers that none of them at this stage are receiving the allowance?---Advanced allowance, no.

PN657

And what skills or what jobs do they carry out on a daily basis? Do they rig cranes, erect steel?---Yes, yes.

PN658

Do they get assistance from TAs, for example?---Potentially. Generally speaking, not.

PN659

Yes. Yes, but it may be erecting steel they might get from TAs?---That is potential.

PN660

Yes. So the TAs would be assisting putting up this structure?---TAs are like - exactly like assistants.

PN661

Yes, yes. But if they weren't doing it then you would need another rigger or someone else to be there, wouldn't you?---Potentially.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN662

Are you aware of under the Metal Trades General Award that there used to be two classifications. That was - - -?---Not specifically.

PN663

I haven't named them yet, so just - - -?---Sorry.

PN664

There used to be certified rigger and licensed and unlicensed riggers and scaffolders?---I am aware of the terminology, yeah.

PN665

Yes. There used to be certified rigger or scaffolder or certified rigger/scaffolder/other. that is how it was - - -?---I am aware of the terminology.

PN666

Yes?---That is all I can say.

PN667

And the other was those people, in those days, who had permits weren't they?---I couldn't be that definitive in my knowledge of it. I am aware of the terminology, that is all.

PN668

Okay. So if I put to you that that was certified rigger/other, they were with permits to work alongside riggers or scaffolders, you wouldn't say that wasn't correct?---I would accept your advice.

PN669

Okay. No other questions.

PN670

THE COMMISSIONER: All right. Thanks. Do you need to re-examine?

PN671

MR COOKE: No re-examination, sir.

**** KEVIN RICHARD KNUCKEY XXN MR SAUNDERS

PN672

THE COMMISSIONER: All right. You can sit down thanks, Mr Knuckey?---Thank you.

<THE WITNESS WITHDREW [2.11pm]

PN673

MR COOKE: That concludes the case for the employers that we represent, sir.

PN674

THE COMMISSIONER: Right.

PN675

MR COOKE: We stand on our belief that the allowance is being correctly applied. Thank you.

PN676

THE COMMISSIONER: Okay. Thanks.

PN677

MR SAUNDERS: Can we have a five minute break?

PN678

THE COMMISSIONER: Yes. Righto. Yes, all I need is you to sum up.

PN679

MR SAUNDERS: Yes, I know.

PN680

THE COMMISSIONER: You want to do a bit of - - -

PN681

MR SAUNDERS: Yes, five minutes.

PN682

THE COMMISSIONER: Right. That is all right. Okay.

SHORT ADJOURNMENT [2.12pm]

RESUMED [2.21pm]

PN683

THE COMMISSIONER: Right. Mr Saunders.

PN684

MR SAUNDERS: Thank you, Commissioner. Sir, we submit that the clause set out in the North West Shelf Project Phase 4 Agreement is unique to that agreement. We note that the exhibit C4, 5 and 6, that those subclauses referred to in C4, a certified rigger only and prescribes the leading hand's rate to be paid. In exhibit C5 it states:

PN685

Certified riggers and/or scaffolder's allowance.

PN686

Again it says:

PN687

Be paid the additional rate as a leading hand.

PN688

And in 6, sir, which is the upgrade for the Cape Lambert under the United Construction Pty Limited, it talks about a certified rigger's allowance be paid the leading hand's allowance. Sir, in the North West Shelf Project Agreement it doesn't express leading hand allowance, it expresses that they get paid an allowance and further qualifies it by saying they are advanced riggers. So obviously it is our submission that this allowance is different from those prescribed in those exhibits, it is different from those prescribed in the Metal Trades General Award. It was an allowance in our respectful submission, that applied to all certified scaffolders and riggers who held advanced certification.

PN689

Sir, the evidence that was led by Mr Dodgson, Mr Kelly and Mr Knuckey was in the main without being disrespectful, they weren't sure of the type of work advanced riggers and scaffolders carry out on a day to day basis, why some were being paid it and some weren't, what duties were being carried out for those who were being paid it. Other than Mr Knuckey said that in his submissions that five advanced scaffolders were receiving the allowance and that is because they were supervising three or more people.

PN690

I would suggest that that is not the concept of the provision. The provision for that would be the leading hand allowance. This allowance is different to a leading hand allowance and doesn't take the place of a leading hand allowance. As I said, it applies to all advanced riggers and all advanced scaffolders. Sir, the evidence also was from those three witness, was that none of them had attended negotiations, that they weren't there when the provision was negotiated and that if it was intended, it is our submission if it was intended to apply in accordance with those exhibits or as per the award then we would suggest that the provision would be written in similar terms.

PN691

That would be that certified riggers or certified scaffolders would receive the leading hand allowance. And of course that is not what the provision says. The provision says they get less than leading hand allowance. You see, the award provision and the exhibits of certified agreements, some certified agreements say that they will be paid if they take the responsibility of supervising others, a leading hand allowance. This provision says that they don't get a leading hand allowance that they receive the lesser thing and on that basis when the authors or negotiators put the agreement together it is our submission that there was always the intent that the allowance applied.

PN692

The submissions put by the three witnesses were that without any real evidence, so it was on their suspicion that it may affect the relativities between the tradespersons on the project and the advanced riggers and scaffolders. It was never put to test, their evidence was they never asked the tradespeople whether they be in block or as singular people, it had never been put to them. And yet Deputy President Watson when having a look at the relativities in the National Building Trades Award, some three, maybe four years ago now, moved the riggers and scaffolders from 97.5 per cent if I recall correctly to the 100 per cent mark which was the tradesman's rate.

PN693

And I'm not aware of any disputes over the relativity base in that industry because those classifications have been moved to a 100 per cent base of the award. Of course, this provision doesn't move them to 100 per cent base it moves them from a 96 per cent base to roughly a 98 per cent base. And further if they've been deemed to be a leading hand it would move them up to close to 99.3 per cent base and that would have happened if the original provision had applied. The matter of the wording of the clause, it is correct to say that it could be ambiguous as it is written in the context of similar terms that apply in the Metal Trades General Award.

PN694

But at the time of negotiations both parties, it is our respectful submission, understood that we didn't apply the leading hand's provision because it was going to apply across the board to all advanced riggers and scaffolders and that relativities were discussed at that particular time and to make sure there was a percentage gap between base trades and advanced riggers and scaffolders than it was agreed that a lesser rate would apply in this provision than that of a leading hand. The advice obviously that the contractors had put on evidence because they weren't part of negotiations advice that they received from the Chamber of Commerce who represented the client or the client at that particular time who negotiated on behalf of the contractors or prospective contractors was that a provision should apply, being Greenfields those contractors had no concept of what was being agreed to or the content of how it should operate.

PN695

And we respectfully submit, sir, that if it was in the same terms of those exhibits or in similar terms of that that applies in the Metal Trades General Award, it would be up to the Commission then to say that quite clearly that was the intent, the parties or the Commissioner may believe that was the intent that the parties were going to apply a similar provision. Obviously this is a new provision, a provision that is not found at this stage in any certified agreement. It is a provision that - taking into the content of some of the evidence that was led that they would be looking for the most experienced riggers and scaffolders holding advanced certification.

PN696

The evidence has shown that they go and source those workers, they will saturate as long as they can to try and attract workers to the project with advanced certification in both those classifications and in saying that they want to use lesser rates. I go back to an earlier submission, sir, that the parties will cognisance of delineating between a basic rigger when we put them in CW3. We then saw a difference between the intermediate and the basic and we say also we saw the skill difference between an intermediate and an advanced rigger which brings about this new allowance which we submit applies to all advanced certified riggers and scaffolders in the project agreements. If it please the Commission.

PN697

THE COMMISSIONER: Right. Thanks for that.

PN698

MR COOKE: Sir, if I may just briefly in reply. Primarily we rely on our opening submissions and the reasons, the many reasons we gave of the very sound reasons we gave why we say the union claim should not succeed. I think there is a couple of things that need to be pointed out. I think Mr Saunders, with respect, might have misquoted Mr Knuckey. Mr Knuckey said that where he had scaffolding, three person scaffolding crews, one was designated as the leader. The reason that fell into the classification was that the person had both competency and the supervision tests. As Mr Knuckey said, you could tick both boxes.

PN699

If they were supervising more than three people then they become leading hands. And the provision 5(4)(ii) it is quite clear that it says that someone who is a ticketed rigger or certified scaffolder with an advanced certificate of competency other than a leading hand and who then meets the supervision tests gets paid. So if you are a leading hand you don't obviously get both. And the fact that United KG scaffolding crews were three persons, one of whom was designated as a leader therefore was to be paid. To deal briefly with something that was raised by Mr Saunders in his closing the decision of Deputy President Watson in relation to the restructure of the classification structure of the National Building and Construction Industry Award, where yes, the rigger did go up to 100 per cent.

PN700

But what wasn't stated by Mr Saunders was that in effect a tradesman who can ties his own shoe laces became 105 per cent. Now that might not be exactly accurate as to the test, but the person didn't have to do a lot more than that to warrant a re-classification. So obviously it hasn't created an issue because they gave all the tradesman 5 per cent more or basically made it extremely easy, to use a cynical approach from a practitioner's perspective, for every tradesperson to move up to 105 per cent level. As I said it was around our office quoted as being doing little more than being able to tie your own shoe laces.

PN701

The key point, sir, in the qualification to the allowance is the requirement for supervision, where that is met the allowance is paid. And we say that it was designed on a basis of trying to meet a requirement for those people who would not otherwise fall into the leading hand categories. And we would respectfully request that the Commission find against the union's claim. If it please the Commission.

PN702

THE COMMISSIONER: Thank you. Can you comment on the position that Mr Saunders put that they've dropped off the intermediate in the basic rigger which is in all the other agreements and all the other awards and just left it with an advanced rigger and also added an advanced scaffolder. That seems quite strange to me that they would exclude quite a range of people from the ability to collect that allowance?

PN703

MR COOKE: Not really, sir. Really in some senses I'm not sure that people have written other agreements have taken time to understand the nature of this certification process that now applies to scaffolders and riggers. And the fact that someone at a basic level still holds a piece of paper that is indeed a certificate. We were certainly cognisant of it when the agreement was being put together and we were not seeking to have any payment apply to those people. Indeed there was a debate I recall as to whether the intermediate person should have been at CW3 or CW4. And in our view the classification structure in the wages provided ample and suitable rewards for the basis and intermediate person. The only reason the advanced person was made subject to this was as a recognition of their status but again only in the instance that they were actually supervising.

PN704

THE COMMISSIONER: It just seems to me that you must be a very good negotiator because on the basis of this the union has been dudded.

PN705

MR COOKE: Oh, with respect, sir, I don't believe they have.

PN706

THE COMMISSIONER: Well, if they haven't they have - - -

PN707

MR COOKE: Compared with the award they've extended it to scaffolders that they never had.

PN708

THE COMMISSIONER: Yes, but they've - if they left it as the award provision or as the provisions in all those other agreements, they would be eligible to get $27.40 a week rather than $19.10.

PN709

MR COOKE: Well, first of all in a number of the other agreements there is only one where the scaffolders were picked up so we actually went further than that. But the fact of the matter was that it was an attempt to meet those people in my recollection, who would not have otherwise qualified for the leading hand level. The other exhibits I think C4, C5, C6 talk about being responsible for the supervision of other employees. So potentially someone who was supervising one other employee got nothing, you would have to be supervising two other employees in the plural, to obtain the additional benefit.

PN710

There are other agreements, sir, I think we've pointed out the High Smelt Agreement that has verbiage in similar terms to the North West Shelf Agreement. So I don't know that it was exceptional negotiation as much as it was actually - reflected the intent of what people agreed. The North West Shelf Agreement provides a benefit to someone who is supervising one other employee and that is not a benefit that they would normally accrue either under the award or under the exhibit C4, C5 or C6 where it talks about employees in the plural on each occasion.

PN711

THE COMMISSIONER: All right. Okay. Thanks for that anyhow, I will wait until I get hold of the transcript and I will give you a decision in due course. This matter stands adjourned.

ADJOURNED INDEFINITELY [2.42pm]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

MICHAEL JOHN DODGSON, SWORN PN51
EXAMINATION-IN-CHIEF BY MR COOKE PN51
CROSS-EXAMINATION BY MR SAUNDERS PN92
EXHIBIT #C1 COPY OF AWARD PROVISION PN127
WITNESS WITHDREW PN160
EXHIBIT #C2 EXTRACT FROM WA INDUSTRIAL GAZETTE, VOLUME 15, PAGE 613 PN205
EXHIBIT #C3 CORRESPONDENCE FROM MR SAUNDERS TO MR COOKE DATED 15/11/2002 PN208
EXHIBIT #C4 EXTRACT FROM MONADELPHOUS ENGINEERING ASSOCIATES (WEST ANGELAS PLANT PROJECT) METAL TRADES CERTIFIED AGREEMENT 2001 PN216
EXHIBIT #C5 EXTRACT FROM MONADELPHOUS ENGINEERING ASSOCIATES PROPRIETARY LIMITED (CAPE LAMBERT) METAL TRADES CERTIFIED AGREEMENT 2001 PN219
EXHIBIT #C6 EXTRACT OF AGREEMENT FROM UNITED CONSTRUCTION PROPRIETARY LIMITED (CAPE LAMBERT) METAL TRADES CERTIFIED AGREEMENT 2001 PN220
PETER JAMES KELLY, SWORN PN275
EXAMINATION-IN-CHIEF BY MR COOKE PN275
CROSS-EXAMINATION BY MR SAUNDERS PN318
WITNESS WITHDREW PN509
KEVIN RICHARD KNUCKEY, SWORN PN510
EXAMINATION-IN-CHIEF BY MR COOKE PN510
CROSS-EXAMINATION BY MR SAUNDERS PN550
WITNESS WITHDREW PN673