C2004/2194, Transcript of Proceedings [2004] AIRCTrans 1350 (7 April 2004)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS


O/N 4215

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER BLAIR

C2004/2194

CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION

and

NORSKE SKOG PAPER MILLS (AUSTRALIA) LTD

Application under section 170LW of the Act
for settlement of dispute re claim for
increased wages for Steam Plant Assistants

ALBURY

9.38 AM, FRIDAY, 26 MARCH 2004

PN1

MR J. CULLINAN: I appear on behalf of the CFMEU, and appearing with me is MR P. BOYD, also appearing for the CFMEU.

PN2

MR A. VERNIER: I appear for the company, Norske Skog, which is spelt N-o-r-s-k-e S-k-o-g. With me I have MR G. BYE, who is the organisation development adviser, and at the back we have MR R. HOFFMAN, production line manager, and MR P. FRANCK, assistant line manager.

PN3

THE COMMISSIONER: Thank you, Mr Vernier. Mr Cullinan, do you have any objections to Mr Vernier seeking leave?

PN4

MR CULLINAN: The CFMEU does object to Norske Skog having representation in the form of a lawyer. We think it's a fairly straightforward interpretation of the enterprise agreement argument. The jurisdiction and powers I believe are clear and the working question is understood by both the parties. The provision in the enterprise agreement gives us an example of a job development clause and any wage increase associated with it, so I can't see what a lawyer will add to that, especially if we're going to be going into conciliation.

PN5

THE COMMISSIONER: Mr Vernier.

PN6

MR VERNIER: I think there are some technical aspects to the matter, Commissioner. The company seeks the representation. The union is not disadvantaged by the company's representation because the union has an experienced advocate to represent it and the employees. As Mr Cullinan did point out, there are issues in relation to interpretation of a particular industrial instrument which may require some specific skill and knowledge. The company is here with the relevant people and these relevant people are prepared to participate to provide you with the appropriate knowledge and information in the conciliation process. But in the long run, if it does involve some technical issues then the company, with due respect to Mr Cullinan's submission, should be represented at this stage of the process.

PN7

THE COMMISSIONER: Is it the parties' intentions to put their respective positions on transcript and then go into conference?

PN8

MR VERNIER: As I understand it, yes. We don't know exactly the nature of the claim being put by the union at this stage.

PN9

THE COMMISSIONER: Right. Mr Cullinan?

PN10

MR CULLINAN: Yes, that is the expectation of the union, to put our position despite the company not necessarily knowing what the claim is. I'd just like to point out as well that the Workplace Relations Act provides for me as an employee of the CFMEU to represent the CFMEU here today. It doesn't necessarily provide the same luxury for the company to have a lawyer today. And I'm not quite sure that I agree - I don't agree that the substance of any legal nature - the human resources department representatives here today, they should be perfectly capable of interpreting what the industrial instrument in the enterprise agreement provides for.

PN11

THE COMMISSIONER: What I will do is I will grant leave to appear at this stage, if the only intent at this stage is to put the parties' respective positions on transcript, and then we'll go into conference. If we're unable to resolve the matter in conference and it requires a full and frank submissions, then I may need to review the leave question. Mr Cullinan.

PN12

MR CULLINAN: If the Commission pleases. This claim that we're bringing is under section 170LW and, as the Commission is aware, it provides for the Commission, if it so approves, to settle disputes over the application of the agreement. The disputes procedure has a series of steps in it and that finally provides for the Commission to be empowered to resolve by conciliation or arbitration. The Commission has that then power to make a binding decision on the parties.

PN13

In the first instance, we hope there is some opportunity to discuss coming to a conciliated outcome, and we'll put our position on transcript shortly. But we are concerned about the company's position to go into a conciliated outcome, given the current circumstances in terms of granting release for our sub-branch secretary, Phil Boyd, to be here today. They wouldn't grant release from, not only his normal duties, but his coverage of a fellow worker who was injured in a motorcycle accident. So, Phil and our union at our own cost has had to provide coverage for that shift, rather than the company providing it for this dispute resolution.

PN14

I'll just go on. I just want to provide a brief history first. In early 2003 there was a Norway - Norske is a Norwegian company - there was a Norway driven de-manning process that they entitled "Improvement 2003". As part of that process, they targeted one of the jobs on the site, and that was the thermo-mechanical pulp assistant, TMP assistant job. In terms of targeting that job, they then went on to shuffle the work around that was done by that worker. Part of that work that was done by that worker went to another worker, which was the RCF operator, or the recycled fibre plant operator. And that becomes relevant shortly.

PN15

At the same time there was an issue in the woodmill. There was a system involved debarking trees. That system changed in an effort to save money in terms of maintenance and less refuse, and also to improve the quality of the chips. So that was about making money and about saving money, which is fair; it's a business.

PN16

So, in doing that, it slowed down the line in the woodmill. Now, that required more time for the woodmill operators to work in that area. So they weren't able to do a certain set of duties as well. And so there's two sets of duties: the RCF operator's duties and the woodmill operator's duties. Part of their duties were to work on the PDF pad in working with UPMs, or universal pulp monitors. This is relevant because this is exactly the work that has now been placed on the steam plant operators to perform; a substantial amount of work. So now, rather than performing one small function which was really to unstrap and unlock cassettes or groups of these UPMs, they changed that small function to doing all of the work related to the UPMs.

PN17

I hope that we can make it out there some time soon, but the UPMs are devices that come in stacks or groups of five in a cassette, they get removed one by one, they have to have their legs stood up, the pulp is then put on to those, then they get removed again, they get wrapped in plastic, they get straps, with straps around it, they get put to the side and then they get loaded on to trucks. So the vast majority of that work used to be done by these two other operators that have since been moved on. Now it's being done by the steam plant operators.

PN18

This change in the nature of the work we say is a significant net addition to the steam plant work requirement. It's a set of skills that they haven't used before. They haven't been assessed in that work before. And we say it warrants a new classification, that being above the level 6 that they already, or level 5, that they would attract a 5 per cent wage increase. The level 5s would become level 6s and the level 6s would become level 7s as such.

PN19

Now, the significant net addition is made up by three components. The first is a skills and knowledge increase. The work is of a different nature. These workers spend most of their time working at panels or at computers and in monitoring equipment, ensuring that the steam plant and its associated processes continue working and functioning soundly. This is a necessarily laborious work. It's difficult work, it's heavy work, it's working with 20 and 5 tonne forklifts, and it's also manual work in standing up legs and strapping procedures on the UPMs.

PN20

There's numerous specific procedures and standard operating procedures that are associated with this work. It's never been done before by these workers, it's new for these workers, and they're not trained on it and they're not assessed on it, or they've just recently been trained as part of this process. And importantly, the skills that they're using and they're learning as part of this work is cumulative on any other skills that they've had previously.

PN21

The workload is the second major issue, and that is that the workload has increased substantially. There's no reduction in the other work that they're doing and the very significant increase in workload is unsustainable. The company's own data shows that there's been something like six hours extra work per shift, so they work 12 hour shifts and they're supposed to be able to put in an extra six hours' work each shift. That has to be dealt with probably at another time in another way but, in any event, there's going to be a significant increase in the workload of these workers.

PN22

The third and probably most important point is the responsibility increase. There's a key increase in the responsibility these workers now have for a work area. Previously there were three work groups. That's the woodmill worker and the person working recycled fibre, those two earlier ones I spoke about, plus the steam plant operator to a much lesser extent, were responsible for this area. The steam plant operator had only a very small component of that work. Now the steam plant operators are solely responsible for the work in that area. That's important and significant because it's a continuous operation procedure. The UPMs come in in cassettes one end and they have to go out in the trucks to go to the other plants in Australia to be able to make the paper.

PN23

There's a whole series of steps in terms of that work and perhaps it would be better to see it, but I've already outlined it and it's off the truck to going back on to the truck and all the processes in between. So all of these changes in the nature of the work result in a significant net addition to the work requirements. We therefore say that there should be a new classification put in or, more realistically, to simply increase the level 5 and level 6 payments by 5 per cent. At this stage that's all the submissions for the CFMEU. If the Commission pleases.

PN24

THE COMMISSIONER: What did you have as the third point?

PN25

MR CULLINAN: The third point was the responsibility increase, responsibility for the work area. If it please the Commission.

PN26

THE COMMISSIONER: Yes, Mr Vernier.

PN27

MR VERNIER: Thanks, Commissioner. I just want to say from the outset that the company doesn't concede that this particular application arises out of the agreement or that it's an appropriate application for section 170LW. The union is seeking a wage increase. The certified agreement contains the wage increases that are applicable up until the certified agreement expires. So, in order for an additional wage increase or introduction of a new classification, that would require a variation of the certified agreement, and the Workplace Relations Act is very specific about how a certified agreement can be varied, and this is not one of those ways in which it can be done.

PN28

Leaving that to one side, if I can go now just to the substance of the matter. The real issues commenced in about December 2002 when the current certified agreement was being negotiated. At about that time, there was a decision to try and centralise the company's operation. So it was a decision to introduce further automation. So if I can just call that the automation program, Commissioner, because it's different to what Mr Cullinan has just outlined. So this automation program caused a bit of fear in the employees that potentially they could lose jobs. And, as I understand it, the no extra claims clause in the current agreement which refers to job development, that particular reference was limited to this automation program. Now, that program hasn't been completed. The consultation process has been ongoing.

PN29

Shortly after the announcement of trying to centralise the company's operations, there was another program that had to be introduced, which was a best practice type program, whereby one employee per shift was to be made redundant. This is what's called "Improvement 2003", and it is this particular program that has led to the union's claim today. Improvement 2003 was a situation where one employee per shift was to be made redundant. The consultation process I think commenced early in 2003. There were a number of meetings with all the employees, a number of overhead presentations, there was a special group that was set up to deal with this situation, and at the end of the day redundancies took place in June 2003 and September 2003, and they were all voluntary redundancies; no forced redundancies.

PN30

This obviously led to the situation where the work that was previously done by those employees that were made redundant or volunteered for the redundancy, had to be taken up elsewhere. So, some other employees had to end up with extra duties or other duties. The employees asked the company to provide them with some options. The first option that was provided was that the steam plant assistants, which are the subject of this particular application, would take over what's called the Hydros operation, which is a mixing of chemicals. The steam plant assistants weren't too keen on undertaking that particular operation and suggested that they take over the pulp dewatering facility, which is the PDF. So, after further consultation, it was decided and somehow even agreed, to an extent, that the steam plant assistants would take over this PDF, the pulp dewatering facility.

PN31

Prior to this Improvement 2003 program, the steam plant assistants did participate to some extent, a minor extent, as Mr Cullinan pointed out, in some duties in this PDF plant. And that is, they did unstrap these large cassettes or these UPMs, and they did participate in some of those activities. And it's quite right that the major function of a steam plant assistant is to look at the panels and make sure that the facility is running correctly. So, the steam plant assistants took on the role of looking after this pulp dewatering facility. Part of the duties which do contain a more labour intensive aspect of work is to wrap, strap and despatch these UPMs. There's no doubt that it is more labour intensive. But it is also work that is less skilled.

PN32

At the moment the steam plant assistants operate in six levels, levels 1 to 6. The entry point is level 4 for a steam plant assistant. Most of the steam plant assistants are either level 5 or level 6. The difference in the pay rates between each level is 5 per cent. The career path for each of the steam plant assistants is competency based. So, if you complete a particular unit of work or study in accordance with the career path, you move on to the next level.

PN33

Now, the competency for the work which was assigned as a result of the redundancies to the steam plant assistants, that is, the storage and distribution of the pulp product, that has a rather lower level of skill requirement than some of the other tasks that they current fulfil. So, even if the union could bring such a claim to reclassify and claim extra wages, the company disputes that particular claim on the basis that this extra work is actually work of a lower level than they currently undertake. Certainly it is more physical work. They're much busier now than what they were before. But that does not warrant any wage increase.

PN34

The company uses the Australian Qualification Framework to set the levels for each of the career paths. The AQF rating to store and distribute pulp product is at a level 2, and the ratings go from 1 to 5, 5 being the highest skill. So, in a nutshell, Commissioner, we say that really, and with all due respect, there is no jurisdiction to deal with a reclassification, there is no jurisdiction to deal with a wage increase under the current EBA that is in place, the certified agreement, and especially under section 170LW.

PN35

If that's not correct, then the company's position is that these workers have taken on duties which are of a lesser skill, of a lesser category, and that in itself does not warrant a wage increase. There has been more than a year's worth of consultation in relation to this particular process. The company is prepared to look at better ways of doing the job and providing assistance for the workers to do the job, but the company will oppose any wage increase or reclassification of the structure.

PN36

THE COMMISSIONER: Just say your argument concerning section 170LW is correct, why isn't the union entitled to bring under section 99 a work value claim?

PN37

MR VERNIER: Well, if that is the case, then let the union bring it. But they haven't done that. Obviously I don't need to go into the technicalities of what is a dispute. We are in New South Wales. Certainly if it wants to bring a work value claim we still say - well, then obviously it becomes is there a significant change to the job in order to make an assessment in that situation, Commissioner. But it is a 170LW application and that's the way we've proceeded to date.

PN38

THE COMMISSIONER: Right, okay. Mr Cullinan.

PN39

MR CULLINAN: Yes, there's a few things to respond to there, and the first one is the nature of the 170LW application. I don't know if you've got a copy of the enterprise agreement there, but there's a couple of clauses that - - -

PN40

THE COMMISSIONER: No, I don't. Do I? I do apparently. Is that the one certified by Commissioner Redmond, 26 February 2003?

PN41

MR CULLINAN: Yes.

PN42

THE COMMISSIONER: Yes, okay, thanks.

PN43

MR CULLINAN: I might draw your attention firstly to the no extra claims clause, and that is that it's a pretty standard no extra claims clause except for the final sentence, and in that it allows for extra claims in relation to matters that are consistent with the agreement, and then provides an example, and that example is the job development outcomes that impact upon career paths and pay levels.

PN44

Now, I understand that the company is now disputing whether this is a job development outcome and that job development is somehow linked to automation, another program that they're running at the moment to try and de-man, but the point is that, even if it wasn't, even if it was for automation, it still provides for that notion that there are outcomes that provide for career path and pay levels out of the basis of any actions made by the company.

PN45

Now, we say that job development is this. This is exactly what job development is about. It's about removing one worker or it's about moving workers around the site and giving them new work and new work areas to work in and therefore that this is a claim based on that. We followed the disputes procedure in the agreement based on that this is a job development claim. We've had discussions with the company through the disputes procedure based on that it's a job development claim. The company has written to us and has explained that they have reviewed themselves what the skills and classifications are, and that they therefore do not see any need to make this wage increase.

PN46

We've held discussions with the site HR manager on this on numerous occasions. We put to her that we bring this together as a joint application to have it resolved and she decided, no, that she was clear that there wasn't a constituted wage increase and therefore she didn't want to bring it jointly. So we said we'd bring it ourselves. It's new to us that it's disputed whether there is any jurisdiction for that, because we would have brought a section 99 application if that had been the case. So, on that basis, we say that, not only does this fall under job development and therefore under the right of the Commission to make this change, but the Commission has that power in any event.

PN47

On a couple of other matters that the company has raised, it was put forward that the option was put to workers and the workers suggested they would take over the PDF and then they agreed and this is where we've come to today. That wasn't the case. It was put on the workers that they take over the PDF, and they've tried to take over the PDF. Part of that is a wage claim and part of it is the other issue which the company has alluded to, and that is a need to resolve any issues to do with the workload. We say that the workload is unsustainable. We've said that to the company for four months now. And something has to be done about that, sure, but that's not part of this wage claim.

PN48

On the issue to do with the increase in labour intensity and the decrease in - not the decrease in skills, but the lower skill set, we're saying that the skill sets are cumulative, so it's part of a skill set that might be a lower level skill set in a different work area, but this is a different work area. These steam plant operators and assistants are cumulatively getting more skills, they're working outside their normal work area or their normal work environment, and they're working out in terms of a much more labour intensive job. So, we still put our claim. If the Commission pleases.

PN49

THE COMMISSIONER: Yes, Mr Vernier.

PN50

MR VERNIER: Just a couple of points. If the union is relying upon the no extra claims clause, which means it's a claim that can be brought because it's not covered by the no extra claims clause, then that claim can't arise under this agreement because it's a claim that's outside of this agreement. So, the argument on 170 must fail at that point.

PN51

In relation to whether the employees agreed to go over to work on the PDF plant, as we understand it - and I'm only putting this to the best of my knowledge - the option to work at the PDF plant was actually originally put by the employees themselves because they didn't like the first option of this Hydros plant, which is mixing the chemicals. So that might be an issue, but the position of the company is that it wasn't something that was originally raised by the company; it was actually put by the employees themselves.

PN52

There is also - once you read the enterprise agreement or the certified agreement, Commissioner, there are links to 10 other documents in that agreement. It's a little difficult to manage because it refers to all of the past agreements themselves. One of the benefits of all the agreements is this flexibility in the work force, and it is this flexibility which enables the company to suggest that these employees should be able to do that work, are capable of doing that work, are doing that work. Yes, they are a little busier than what they were before, but that's not an excuse for a wage increase. The company is prepared to assist in working out better ways to do the job, to bring other people in from other parts of the plant to help them do the job when they're busy doing other things, but the wage increase is disputed.

PN53

THE COMMISSIONER: You say that the agreement and various agreements that have been in place since provide for flexibility.

PN54

MR VERNIER: Yes.

PN55

THE COMMISSIONER: I would expect the union's argument to that would be, "We don't object to flexibility, we've negotiated the agreements, but there is a distinct difference between flexibility, that is, the ability of people to be able to do multi functions and to be able to move across a range of areas, as opposed to being overburdened with additional work." That doesn't necessarily mean flexibility. Distinct difference.

PN56

MR VERNIER: No, the company accepts that these workers are busier now than what they were, but they're still doing - they're on 12 hour shifts. They're not doing more than that. It's just a busier day. And there are systems put in place that if the work can't be done, they report it to the coordinator who will organise other people, other employees, to assist in order to get the work done. So it's not like they're being overburdened; it's just that they are certainly busier.

PN57

And through this process, the company was able to see that prior to this introduction of this extra work, maybe these workers weren't busy enough. They had extra capacity. Now this extra capacity has been taken up by these additional duties. But that's not enough to warrant a wage increase. There has been a safety risk analysis done on the job, so that's already been done with the assistance of the employees, and certainly there's been some sort of time analysis done as well. And the whole point is that if they can't do the job in the time, then the process has been put in place that they are to put their hand up, speak to the coordinator, and other workers will be organised to do the work with them or instead of them.

PN58

THE COMMISSIONER: Okay. The parties have no objections to going into conference?

PN59

MR VERNIER: No objection.

PN60

MR CULLINAN: No objection.

SHORT ADJOURNMENT [10.09am]

RESUMED [10.50am]

PN61

THE COMMISSIONER: In order to move this matter along, the union is to provide to the employer by the close of business on 2 April 2004 their amended application under section 99 of the Workplace Relations Act and the reasons for their application and claim. The union will also provide to the employer, with a copy to the Commission, their outline of argument and any witness statements that they intend to rely upon, by the close of business, that is, 5 pm on 20 April 2004. The company in return is to provide an outline of their argument and any witness statements that they intend to rely upon by 5 pm, 14 May 2004. And the union is to provide any response to the employer's outline of argument to the employer and to the Commission by 5 pm, Wednesday, 19 May 2004.

PN62

The Commission will then set down Tuesday, 25 May for inspections at the plant, and my associate will make contact with the company about arrangements on how that will occur. The Commission will also set down Wednesday the 26th and Thursday the 27th to hear full and proper argument from the parties concerning the union's claim. Is that clear?

PN63

MR CULLINAN: Yes.

PN64

MR VERNIER: Yes.

PN65

THE COMMISSIONER: Okay. The Commission thanks the parties and will stand adjourned until Tuesday, 25 May in Albury.

ADJOURNED ACCORDINGLY [10.52am]