|
|
Home
| Databases
| WorldLII
| Search
| Feedback
Australian Industrial Relations Commission Transcripts |
AUSCRIPT PTY LTD
ABN 76 082 664 220
ADMINISTRATOR APPOINTED
Level 4, 179 Queen St MELBOURNE Vic 3000
(GPO Box 1114 MELBOURNE Vic 3001)
Tel:(03) 9672-5608 Fax:(03) 9670-8883
TRANSCRIPT OF PROCEEDINGS
O/N 7278
AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION
COMMISSIONER HINGLEY
C2004/1995
AG2004/3028
METAL, ENGINEERING AND ASSOCIATED
INDUSTRIES AWARD, 1998 - PART 1
Application under section 113 of the Act by
Prestige Property Services to vary the
above award
APPLICATION FOR VARIATION OF
CERTIFIED AGREEMENT
Application under section 170MD(6) of the Act
by Prestige Property Services Pty Ltd to vary
the Prestige Property Services (Cleaning)
Portland Aluminium Site Collective Bargaining
Agreement 2000 in relation to severance payments
MELBOURNE
10.45 AM, FRIDAY, 28 MAY 2004
Continued from 23.4.04
PN76
MR M. MURPHY: I seek leave to appear for the applicant in this matter.
PN77
MS E. WALTERS: I appear for the Australian Workers Union in this matter.
PN78
THE COMMISSIONER: Any objection to leave being granted, Ms Walters?
PN79
MS WALTERS: No, Commissioner.
PN80
THE COMMISSIONER: Leave is granted, Mr Murphy.
PN81
MR MURPHY: Thank you, Commissioner. Commissioner, thank you for standing the matter down for a short time. The matter is proceeding. The Commission will be aware that the parties have made written submissions on both sides, including witness statements. In terms of the evidence that we propose to call today, we have Mr Jeff Morgan available to give evidence on behalf of the applicant. We have also Mr Chris Brown, who is the Transition Manager of the successor contractor, Skyways, who is available to give evidence, and he has submitted a witness statement. And we also have Mr David Smith, who was the former Manager of Prestige at Portland, and the Commission has made arrangements for him to give evidence by video at midday, as I understand it.
PN82
THE COMMISSIONER: Yes. We will adjourn about 10 minutes before just so that the equipment can be checked.
PN83
MR MURPHY: Yes. So that is the evidence that we will be seeking to call. But I might just indicate to the Commission the way we see this application, so that it is very clear the nature of our application right from the beginning. Commissioner, the position is that the parties here were the parties to a certified agreement in 1997 that was certified by this Commission, and that agreement recites that the underlying award is the Metal Industries Award 1996.
PN84
That certified agreement, I think that was annexed to our witness statements that we have provided. That provided that the applicant was to pay $25 a week by way of payments to Incolink, which is the fund established under the building industry for essentially redundancy insurance for employees. That was the only reference to redundancies or severance payments in the 1997 agreement. The underlying Metal Industry Award does have extensive provision - did have extensive provision for severance and redundancy in the standard form. Just so that I can ensure that the Commission has that available, I will hand up a copy of that 1997 agreement.
PN85
PN86
THE COMMISSIONER: I won't mark this, because it is a document of the Commission.
PN87
MR MURPHY: If the Commission has had the opportunity to read our outline of submissions, you will see the nature of the way we put the application. The original application that was made, Commissioner, was an application under section 113 of the Act to amend the award, and that application remains on foot. Now, the respondent has taken the position that, because the applicant is not bound by the award, it has not got any standing to make an application under the award to amend it or to seek relief from the general severance payment provisions under the award.
PN88
Now, we accept that we were not strictly bound by the award as a respondent or as a member of any industrial organisation that was bound by the award. So the position between the parties is that they then, in 2001, made a further certified agreement, and again they recited that the parties were bound by the award and that the certified agreement had the Metal Industry Award 1998 as the parent award for the purposes of the no disadvantage test. That is in clause 5.4 and 5.2 of the 2001 certified agreement, certified by this Commission.
PN89
We haven't actually put them in our witness statements, but we have also the statutory declarations that were submitted by the two parties - by the applicant employer and by the union in 1991, sorry, 2001 - to get the award certified, indicating that both parties said that the parties were bound by the award.
PN90
THE COMMISSIONER: Which you now say they are not, is that right?
PN91
MR MURPHY: Well, we say that we are not, but we say it is relevant to the way the Commission should deal with this matter, because the certified agreement is premised on both parties being bound by the award. And it is relevant to the authority of the Commission under section 170MD whether there's an ambiguity or an uncertainty in the operation of the certified agreement. The way I will be saying - what I will be saying to the Commission is you effectively have to read the certified agreement and the award as a single agreement, as an industrial instrument agreed between the parties and certified by this Commission in 2001.
PN92
So they are to be read together. Even though the award does not have any binding force as a matter of law under the award provisions of the Workplace Relations Act, it is given that force by the parties agreeing that the certified agreement is premised on that award, so they have got to be read together. When they are read together they allow the applicant employer relief from the severance provisions in the event - or to make application for relief of the general severance provision.
PN93
So the substance of our case is that there has been this change of contract down at Portland of the cleaning contract. Our employees - we gave them notice of termination when we were advised that we had lost the contract. Those employees were then engaged by Skyways, the successful contractor. They are now employed as full-time - 12 of them are employed as full-time employees by Skyways, essentially doing the same duties that they were doing for us, but Skyways, Mr Brown will give evidence, have accepted all the obligations under the certified agreement, the 2001 certified agreement.
PN94
The only difference in their actual employment terms - the wage rate is the same, the hourly rate is the same, but they are working 36 hours a week whereas previously they were working 38 hours a week. So any overtime that they do work in any event is to be paid pursuant to the certified agreement as overtime. Essentially they are in the same employment, on the same premises, on the same terms and conditions under the same certified agreement.
PN95
THE COMMISSIONER: Retaining their accruals?
PN96
MR MURPHY: No, they are not retaining their accruals, but I want to come to that, because that is a crucial point. When we terminated them, we paid out their accrued long-service leave and their accrued annual leave and annual leave entitlements. That is not in dispute. The crucial point is that all these employees had quite extensive - a number of them, the bulk of them, had quite extensive service: 14 years' service. And so they had accrued long-service leave. So any of them that had over 10 years' service got their accrued long-service leave pursuant to the award. One of them, who had only 9 years' service, he got his accrued long-service leave paid.
PN97
So there's only two or three that had 2 or 3 years' service that, in a sense, lost a transferable benefit. Now, we are prepared to pay those couple of employees - the ones that were earning less, that were there for less than 10 years, that were not paid the transferable benefit, the non-transferable benefit - we are prepared to pay that, and we offer that formally on the record.
PN98
In terms of the ultimate merit of the case, the employees that are now employed by Skyways have been paid their service-related benefits, namely, their long-service leave and their other entitlements. They are now working for Skyways, essentially in the same jobs on the same terms and conditions; and so, in those circumstances, we say we've got an argument which we want to put, that this is a succession of business. It is not a transmission, because there was no legal relationship between us as the contractor with Portland and Skyways as the contractor with Portland.
PN99
We did obtain, we say, the alternative employment for these people. The actual mechanisms of that we will hear evidence about and you have seen the evidence. Skyways, in a sense, say: there was no transmission; we terminated; they advertised them. That is not disputed, but the fact was that we made facilities available for them, so they got their alternative employment. It wasn't alternative employment; it was just continuous employment, we say, with a different body. So that is the end position.
PN100
What we are asking to do - what we are asking the Commission to do is to make appropriate orders under the TCR provisions that recognises that and that relieves us in those circumstances of any obligation to pay redundancy, because that is the spirit, and indeed the letter, of the TCR provision: that when alternative employment is obtained, or where there is alternative employment obtained, or where there is no loss of transferable entitlement, because they have been paid, then the employees have not suffered the trauma of redundancies.
PN101
This was a Friday to Monday exercise, Commissioner, and in those circumstances the resistance by the union, by the respondent here, we say, is utterly unmeritorious, and the merit and equity obligation of this Commission is that it should make orders, after it finds there is an uncertainty in the certified agreement, make orders to reflect this. And the cases that we have put in our submission indicate that the Commission does make those orders, particularly in the banking industry; and, indeed, the cases that are relied on by the respondent, none of them are inconsistent with that. And in particular the Glen Campbell case of Deputy President Lacy involving the loss of a contract in South Australia, where the employees went from a private contractor working for the Government in the same essential positions, and Deputy President Lacy did not make provision for redundancy pay.
PN102
So that is the outline of our case, and we will be asking - we have set out the particular provision we would like the Commission to put into the certified agreement - namely, in a sense, a provision that says that those employees that were employed by Skyways, that there is no obligation on the applicant to pay them redundancy - that particular clause that we have put in our submission.
PN103
But if that clause is not - if the Commission takes the view that that clause is not an appropriate way to resolve what the evidence throws up, then we would ask for some other appropriate clause, whether it be by way of a clause that directly specifies under the relief provisions of the award that no severance pay is to be paid or, on a worst case provision, that only partial severance pay is to be paid.
PN104
But these employees - our former employees - we say, are asking for the money and the box. They are wanting redundancies when they have pocketed their accrued service-related long-service leave entitlements, where they have been paid their notice - sorry. They have been paid their accrued annual leave because they - they didn't need to be paid notice, because we gave them notice a month before the change-over date, so they worked out their notice. So there is no obligation for notice for us to pay them any pay in lieu of notice; they got notice.
PN105
When they have been paid all those benefits and entitlements, then the provisions of the TCR case, in our submission, really do provide for an employer in those circumstances to be exempt from severance pay, and that is ultimately what we are asking the Commission to do. But we accept that we have to convince the Commission, under section 170MD, that there is an ambiguity or an uncertainty in relation to the certified agreement.
PN106
We say that there is, and we have set out the reasons for that in our submission, and I will come back to that in a final submission. But at this point we want to call our evidence that is strongly contradictory of some of the material in the respondent's evidence - in Mr Gadsden's statement. Essentially, we put before the Commission the facts: the actions we took in relation to obtaining other employment for these employees, the fact that we paid them all their outstanding long-service leave entitlements under the award, and, as I said, for one of them, even though he had only been employed for 9 years, he was paid, and then the evidence from Skyways that they are employed essentially on the same terms and conditions.
PN107
So at this point, if it is convenient to the Commission, I would like to call Mr Jeff Morgan of the applicant.
PN108
THE COMMISSIONER: In doing that, is it appropriate that other witnesses be excluded?
PN109
MR MURPHY: Well, the other witnesses - I am happy for Mr Gadsden to stay in the Commission, because he has obviously got to give instructions to my friend. But the other witnesses that we are calling - there's Mr Chris Brown, he could perhaps wait outside.
PN110
PN111
MR MURPHY: Mr Morgan, if you could keep your voice up and address your remarks to the Commissioner. Your full name is Jeffrey Morgan?---That's correct.
PN112
And you are currently based at (address supplied)?---That's correct.
PN113
And you have been employed by the applicant Prestige Property Services for about 6 years?---That's correct.
PN114
And have you prepared a witness statement in relation to this matter?---Yes, I have.
PN115
Do you have a copy of it with you?---Yes, I do.
PN116
Is that document of 15 paragraphs and about 6 pages long?---That's correct.
PN117
Have you recently read it?---Yes, I have.
PN118
Right. Are the contents of it true and correct?---Yes, they are.
PN119
Could that be marked as a - - -
PN120
THE COMMISSIONER: Yes. There are a number of attachments to the statement. Are they to be marked as part of it?
PN121
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN122
MR MURPHY: Now, Mr Morgan, could I take you to paragraph 3 of your witness statement and direct your attention to the question of the 2000 certified agreement between Prestige and the union at Portland. Were you involved in the negotiation of that agreement at all?---Personally, no, I wasn't, not in - no.
PN123
Now, in the position before 2000, what was the position regarding Incolink at for the Portland employees?---We were contributing - the company was contributing an amount that was agreed of $25 per week, which was basically 50 per cent of the total amount, and we were paying that into an Incolink fund on behalf of the employees.
PN124
All right. Had that been - that was under the 1997 certified agreement, is that right?---That's correct.
PN125
All right. And was that to continue - were there any changes in the 2000 agreement in relation to the Incolink payments?---No.
PN126
Do you know whether that was the subject of any dispute or discussion during the 2000 negotiations?---It definitely wasn't a subject of dispute.
PN127
What was the position in relation to wage rates under the 2000 agreement?---The wage rates were basically agreed by ourselves and the union, basically on the premises of whatever the site - whatever the union had agreed with Alcoa and all their other contractors in terms of the increase, we agreed basically that, whatever was agreed, that that would be built into our agreement as well. So, therefore, if there was an agreement of a scale of 4 per cent and then 5 per cent year 2 and 5 per cent on year 3, we embraced that agreement as well with the union.
PN128
Okay. Now, could you describe to the Commission what was the nature of your operation down there at Portland before you lost the contract?---We were providing contract cleaning services to the Alcoa Portland site.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN129
And about how many employees did you have?---Approximately 20.
PN130
Yes. And were they - what was the breakdown in terms of full and part time and casual?---Predominantly the majority of the staff were full time. We employed some casuals as well. We obviously had a site manager, but predominantly they were full-time employees, some part time, but - and casuals when we saw fit to bring them in.
PN131
Right. And what was the nature of the contract you had with Alcoa; was it a fixed term contract at that point or what?---We won the contract approximately 14 years ago, and through mutual negotiations we were able to not allow - not allow - we came to an agreement where Alcoa never put it out to tender: that over a period of time, because of the fact that we were providing a good service, they were happy with the service. We encouraged them not to put it out to the market: that we agreed to just roll the contract over on a 3-year - 3 by 3-year periods.
PN132
Right. So each 3 years it was essentially renewed for another 3 years?---That's correct.
PN133
Right. Was there a change in 2003 in relation to the contract?---What happened was that basically they thought that after 14 years that they decided that it should go out to the market. They advised us in late 2003 that they were going to put the contact out to tender, and they invited approximately six cleaning companies to tender for the contract.
PN134
Right. And you have annexed to your witness statement the tender invitation?---That's correct.
PN135
Right. And is that - the scope of works, was that essentially what you were doing before the tender invitation, or was there any changes?---The changes were very, very minimal. Basically, the scope of works for the new contract were exactly the same as the previous contract with some minor alterations.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN136
Right. Was there any provision in relation to the tender invitation as to what terms and conditions people were to be employed on?---We entered into - whilst it hadn't been certified, in March of 2003 the union and Prestige had entered into negotiations on a new EBA agreement. That was to introduce a 36-hour week. It was also to show - to increase the Incolink payment from $25 a week to $53 per week, and also a substantial wage increase. We negotiated - we were in the midst of negotiating those, and whilst it hasn't been certified, predominantly Prestige and the AWU had an agreement that those - that we both, you know, were going to abide by these conditions. When the tender went out in late 2003, every cleaning company was made aware of the new EBA, whilst it wasn't certified, that Prestige and the AWU had agreed upon, that basically being an hourly rate of $21.40, an Incolink payment of $53 per week and an adoption of a 36-hour week.
PN137
Had any elements of that come into effect before February of this year?---All of those things were backdated to March 1 2003. So whilst the EBA was not certified, we agreed to those key points in primarily around August of 2003. We backdated that to March 1 2003, and so that was in place when the contract went out to tender.
PN138
All right. Now then, were you advised in late January 2004 that you had been unsuccessful?---That's correct.
PN139
Right. When did you first have contact with the union as a result of that?---On or around about 26 or 20 of January we were made - we were advised officially that we had lost the contract and that the incoming contractor was Skyways. Immediately when we were advised that, I did two things. One, I contacted our local manager, David Smith, to inform him, and also I contacted Ken Gadsden, who was the union organiser, to advise him.
PN140
And had you been - had any dealings with Skyways previously?---Yes. Skyways were also the successful contractor at Alcoa in Geelong, which we had lost approximately, I think, one year prior to that.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN141
Right. And had - how had the change-over worked down at Geelong?---The change-over in Geelong went very, very smoothly. There was very close consultation with myself and the management at Skyways, and predominantly Skyways employed every person that we had employed, took them over, same scope of works, and they took over the same EBA that was in place in Geelong that we had.
PN142
And did they take over accrued entitlements?---What - - -
PN143
In Geelong?---Yes, they did.
PN144
Right, okay. Well, now did you have any discussions with Skyways in relation to what arrangements were to take place in the Portland exercise?---Basically our primary responsibility was to ensure that all our employees were taken on board by the incoming contractor. So my position was to open the lines of communications with Skyways, to make available our offices, our time, to facilitate a smooth transition and also to ensure that our employees could be picked up by Skyways.
PN145
And what was the thrust of what you were getting from Skyways when you were making those representations to them?---Well, I was dealing with Chris Brown at the time, who was the Transition Manager at Skyways. We had open dialogue. We had spoken on numerous occasions, and basically their view was: yes, we want to interview all the employees. They did allude me that they were going to look outside of our current employees to advertise locally, but basically their belief was: well, we were doing a very good job. We'd lost the contract basically only on a price negotiation. There wasn't concerns about the standard of cleaning, and their view was that we would - that they would look favourably at employing, taking on our people.
[11.15am]
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN146
Was there any discussion about what should - whether employees should be given any notice?---Well, what Skyways - the General Manager, he told me that we should terminate the employees, all of the employees and that we will interview the staff. My response to that is: well, we can't terminate the employees, they've still got a contract until the end of 29 February. We actually gave them notice of termination but we weren't to terminate them straight away, so we did not do that.
PN147
Right. But you did give them a letter saying that they would no longer be employed at the end of the contract?---Most certainly.
PN148
Yes. All right. And then did you then have any further discussions with Mr Gadsden about what was to happen in relation to the employees?---I had spoken to Mr Gadsden on numerous times in relation to the transition of Skyways taking on board. My concern again, as I stated, was to ensure that all our employees maintained a position. On or around about 10 February I flew down to Portland for the primary reason of meeting Mr Gadsden, meeting the shop steward and then also then meeting the client to make them aware that we were trying to endeavour to do everything possible to ensure that our employees were picked up by the incoming contractor. I had a meeting with our local manager, David Smith, myself, Ken Gadsden and Barry Tennant on or around - - -
PN149
Who is Barry Tennant?------Barry Tennant is the shop steward. We had that meeting which went for approximately half an hour. The context of that meeting was to say we are doing everything possible and can we be doing anything more possible. I then had a meeting with the client to let - - -
PN150
Just stop you there. Was there any discussion - did Mr Gadsden raise any issue, at that point, that you should be doing anything more in relation to the employees?---No. I think Mr Gadsden was aware that we were doing everything possible to ensure that they would be picked up.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN151
Right. Go on. You then said you had a meeting with the client?---I then went and met the client to let them know that we had had a meeting, to update them on the meeting on 10 February. And then gave them an assurance that if Skyways weren't in a position to take over the contract on 29 February, that we would continue to stay there for as long as possible to ensure a smooth transition. We weren't there to walk out the door on 29 February. Many times in my history incoming contractors do not start on the contract date as set for a variety of reasons. I wanted to ensure the client that we were going to be there for as long as possible if needed be.
PN152
Did Prestige have any other contracts in that - in the western Victorian region at all?---No.
PN153
Right. What is the usual practice in the sort of industrial contract cleaning industry when a contract is lost by way of a tender?---In my experience in 6 years when a contract is lost the incoming contractor employs approximately 99 per cent of the staff. The outgoing contractor facilitates the arrangements for the incoming contractor. There is a lot of dialogue to ensure that there is a smooth transition and therefore it is critical for the incoming contractor and the outgoing contractor to ensure that the client is not disrupted in a change of contract.
PN154
All right. Now, did you have any further discussions during February with Mr Gadsden?---I think it is fair to say that throughout the month of February I spoke to Ken Gadsden numerous times to ensure that the incoming contractor was going to take on the staff.
PN155
Did you become aware that, at some stage, they made a decision to take on all the staff?---Around about - on or around about the last week of the contract I was informed by David Smith who was our then manager that Skyways had agreed to take on all employees that we had employed apart from the manager; he was not going to get a job. There was one staff member that - it wasn't a WorkCover issue but had not been working with us for approximately 6 months; he had had an injury on a personal level. They did not take him on and there were approximately three members of our staff that were on WorkCover and Skyways did not employ them. Apart from those people everyone else was offered employment.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN156
And you said that you gave the employees notice. Was any action taken in relation to their accrued entitlements?---At the end of the contract within approximately 4 working days at the end of the contract every employee was paid their accrued annual leave and their long service leave if it was - if they were owed that.
PN157
Right?---And that was everyone bar one employee, I think.
PN158
Did Mr - have you seen Mr Gadsden's statement?---Yes, I certainly have.
PN159
Have you seen he has got attached to it a schedule of the employees that he obtained from Prestige. Have you got that with you?---Yes, I have that.
PN160
Commissioner, it is marked as KG4. Have you got a list of about 15 or 20, like this?---Yes. Yes.
PN161
Right. Does the Commissioner have that?
PN162
THE COMMISSIONER: Not yet, but I'm getting there. Yes, I do.
PN163
MR MURPHY: Now, you mentioned that you paid the employees - that document in about the fifth column lists their service with you and in the right-hand column the far-right column, it lists whether some of them or a couple of them were casual. Is that right?---That is correct.
PN164
In relation to the non-casual employees, a number of them have got 14 years' service and a couple of others have got 9 and then two or three others have got lesser periods. In relation to the 14 years' service what happened to their - what were they paid?---They were paid the long service leave as per the EBA award and they were paid their annual leave.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN165
All right. Now, in relation to Mr Malcolm?---Yes.
PN166
Can you recall anything about him?---Yes. He was also paid long service leave and annual leave.
PN167
Are you aware as to whether he was entitled to long service leave?---He was.
PN168
He was?---Yes.
PN169
All right. Now, when did the - in your discussions with Mr Gadsden, when did the issue of pay and redundancies to these employees first arise?---I would like to state that in all my negotiations and discussions with Mr Gadsden that redundancy was never ever mentioned. When we lost the contract, and as I have stated before, we paid everyone their long service leave and their annual leave. I made it - I had spoken to Ken Gadsden to confirm when they were going to get paid that. At that time we agreed that because of the number of employees and because of the length of service that there might be a few employees that we didn't get it right. That we might have thought that they were 14 years, they might have been with us for 13 years, whatever.
PN170
When did that arise - when did that discussion arise about the actual service length?---Well, those discussions were the week prior to us finishing.
PN171
Yes?---That Mr Gadsden and I spoke. He wanted to confirm when they were going to get their final pay. I confirmed that it would be no different to anyone. They were weekly employees. Their money would always go into the bank the following Tuesday and I confirmed to Mr Gadsden that that would be the same. But we also agreed that whenever we do pay out everyone's entitlement there might be some discussions and queries on those payments. We might believe that the annual leave accrued is 40 days and the employee might think that they are 50 days. So we agreed that okay, we will pay them what our records are and if there are any disputes on that that Mr Gadsden would notify me and we would work through those disputes.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN172
THE COMMISSIONER: Did the persons who weren't taken up, did they get redundancy pay?---No. They got their annual leave and their long service leave that was accrued to them. There was no redundancy paid. Sorry, the people that weren't picked up? They got paid redundancies.
PN173
MR MURPHY: Yes. So Mr Smith the Manager, he was paid redundancy by you?---He was paid redundancy as was the other gentleman, Mr Tim Young.
PN174
THE COMMISSIONER: What is the W/C for Mr Lindsay and Mr Rigg?---WorkCover. They are still employed by ourselves. They are under WorkCover.
PN175
MR MURPHY: So you can't terminate them because they are on WorkCover?---No. That's right.
PN176
Yes. All right. So the ones that weren't employed by Skyways and were made redundant by your company, they were paid redundancies?---That's correct.
PN177
Now, when did Mr Gadsden first raise the question of payment of redundancy to the employees that were employed by Skyways?---What happened was is that after a couple of weeks - - -
PN178
From when?---From 29 February when we lost - when we were out. We paid everyone the following week. Two weeks into that, so approximately the second week of March, Mr Gadsden rang me and said: Geoff, I've got a list of queries in relation to some of what you have paid in terms of annual leave. I would like to come up and have a meeting with you. I am coming to Melbourne on a certain date and let's talk about that. At that stage and prior, there was no mention of redundancy. I was led to believe that that meeting was going to be between myself and Mr Gadsden. When Mr Gadsden turned up there was Barry Tennant who was the shop steward and there was also a gentleman who was the - either - I think, the Assistant Secretary of the AWU.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
Unbeknown, I didn't know he was turning up. At that meeting I also brought in our payroll officer, Marialla Bernardi. In Mr Gadsden's statement he talks about a woman there from Skyways. That wasn't a Skyways' employee, that was our payroll person, Marialla Bernardi. I brought her in because again I thought that the meeting was to discuss some inaccuracies about what we had paid in our records in terms of annual leave. I was confronted with a list of various inaccuracies of which at that meeting I agreed that to - instead of us investigating them because it wasn't a big list that we would pay those people the annual leave that we hadn't, you know, where we might have short paid them. Again, for instance, our records might have shown one person that accrued 20 days whereas Mr Gadsden gave me a list that said: Geoff, there was 25 days. So we agreed. But then at that meeting then, and prompted by the assistant secretary, they then said: well, okay, we have agreed on that, now let's talk about redundancy.
PN179
What was the discussion?---Well, what about paying redundancy? My view and my comment was: well, I believe that everyone has been taken on by the new contractor on the same conditions, same hourly rate that no-one has lost their job. In my view, we are not entitled to pay redundancy. They disagreed with that, their comment was, not by Mr Gadsden but by the assistant secretary: well, what happens if they were employed by Skyways and then 6 weeks later or 6 months time they lose their job. My comment was: well, unfortunately I'm not the employer there, I cannot control that. But on 1 March they were all taken on board. We basically then agreed to let the process go to where we are today.
PN180
Right. Was there - it is asserted in Mr Mallen's statement that the - Mr Gadsden's statement that the meeting got heated - what do you say about that?---No. I disagree. I think from - definitely from Mr Gadsden and myself and Barry Tennant that were there, there was no heated words. The assistant secretary was firm in his opinion that we should pay redundancy. I gave my opinion and overall we basically agreed that let the process take its natural course.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN181
Was there a discussion about the transmission of business or the accrued entitlements - the benefit of accrued entitlements?---Yes. Well, as I mentioned before, the meeting was brought to me because the union and the employees felt that a number of them didn't get their true entitlements in terms of annual leave. We agreed at that meeting to pay them that shortfall. Again, I just did not even think about redundancy because in my experience in the 6 years, as I have mentioned here on oath, that when there normally is a change of contract the incoming contractor takes on the employees and therefore there is no redundancy.
PN182
All right. Well, now, were you involved - and so were you aware that the company had made an application in late February to seek relief from payment of the severance - of any redundancy payments?---Yes. That is right.
PN183
All right. Were you involved - going back, were you involved in negotiations at all for the 2000 agreement?---No.
PN184
No. Now, in paragraph 27 of Mr Gadsden's statement he asserts that the provisions in relation to Incolink in the 2000 agreement were to be provided on top of the severance pay agreements provision. What do you say about that?---I disagree with that. In my opinion, and as it was borne out in Alcoa in Geelong, same contract, same union, very similar EBAs, that Incolink is there as a redundancy fund. That therefore when Incolink started, we contributed to Incolink and therefore if there was a redundancy of any issue, that the Incolink fund replaces any redundancy provision. And that is what happened in Alcoa in Geelong.
PN185
Right. Now, later on in his statement, Mr Gadsden asserts that the employment at Skyways is not as good as the employment that was being provided at Prestige and that the employees are worse off. Have you got any comments on that assertion?---Yes. Whilst I don't have first hand knowledge because I'm not now the current contractor, but I had confirmation by David Smith who was our manager that Skyways were employing our staff on the same conditions, on very similar rosters and on a 36-hour week which they were on with ourselves. So my view is that I disagree with Mr Gadsden, that I am stating that basically they are on the same pay and conditions as what they were and I think later on Mr Brown from Skyways will confirm that.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN186
Now, just one other point. In paragraph 14 of your statement you obtained some records from Skyways as to the employees that they had employed, is that right? And you have annexed them to your statement?---That is correct.
PN187
Yes. And do they indicate that the hourly rate is in fact the same?---Yes, it does.
PN188
All right. Just one other point. Were you involved in the actual transition, the fact that the Skyways - that Prestige made available their vehicles for Skyways to use for the short time?---That is right. That was my decision again to ensure that the client was not affected by the change of contract. Mr Chris Brown had spoken to me and said that we were not able to have the vehicles in position on 1 March for the new contract and asked whether or not we could provide the four vehicles that we had in the contract, if they could use them for a couple of weeks until they got their vehicles on board. I saw no reason not to agree to that and they actually had those vehicles for probably, I think, near on a month after the contract - change of contract.
PN189
Yes. Just going back to Mr Gadsden's statement, he refers in his early part of his statement to a changeover at - in sale of a contract that Skyways had won from you, the Longford Gas Plant, paragraph 6 of his statement. Do you have any knowledge of that?---In my time we never had that contract at Esso in Longford.
PN190
All right. So you have got no knowledge of that. Yes. All right. That is the evidence of this witness, Commissioner.
PN191
THE COMMISSIONER: Thank you.
PN192
MS WALTERS: If I may just put a preliminary submission and that is that - and it would have been appropriate if I had come to my feet a bit earlier, and that is that it is the position of the AWU that we have some preliminary oral submissions we would like to make. I don't know whether it is an appropriate course that they occur after the applicant's witness evidence, at the conclusion of Mr Brown or, if not, I am in the Commission's hands.
**** JEFFREY CRAIG MORGAN XN MR MURPHY
PN193
PN194
MS WALTERS: Okay. Mr Morgan, it is your evidence that you have been - you were employed with Prestige for 6 years, is that correct?---That is correct.
PN195
That is correct. And that you weren't present in the 1997 negotiations nor the 2000 negotiations?---That is correct.
PN196
Would you be able to explain to the Commission who was on behalf of Prestige present for the negotiations?---In '97?
PN197
Yes?---That was before my time. I hadn't - I started with the company in March '98. I would think - I stand to be corrected but our group general manager now is Mr John Lazzari and that he would have, together with a gentleman by the name of Gary Mallen, would have been in the 1997 negotiations. In terms of 2000 I stand to be corrected, but a former manager by the name of Gary Mallen would have primarily driven the majority of those negotiations.
PN198
And can you explain to the Commission, Mr Mallen, was he the predecessor to - - -?---David Smith, that is right.
PN199
Can I take you to paragraph 7 of your witness statement? Actually, I apologise, in the first instance if I can take you to paragraph 6 and you have briefly gone through it with Mr Murphy but you are familiar with the - where the Skyways were successful in gaining the contract at Port Henry Alcoa site in Geelong. Can you explain to the Commission in those circumstances, are you aware whether the employees were paid out their accrued entitlements, annual leave, long service leave and so forth or whether those entitlements were
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
transferred to Skyways, in fact?---What happened in Alcoa in Geelong is we had that contract for approximately 6 years. When we lost the contract no employee received any long service leave. All they were only paid was their accrued annual leave. The AWU then put a claim to us for redundancy. We argued against redundancy because again we stipulated that Skyways employed every person. At that time, Mr Winter from the AWU was representing - yes, sorry, the AWU. Their claim was for redundancy for only the period of time that Incolink didn't cover them. So I stand to be corrected. We lost the contract in 2003, Incolink came in in 2000, Mr Winter from the AWU put forward the claim for redundancy for the period from approximately '97 to 2000. That was their claim.
PN200
But the entitlements - the accrued entitlements were transferred to Skyways?---No.
PN201
So the annual leave?---The annual leave was not transferred to Skyways.
PN202
The employees were terminated by Prestige?---Yes.
PN203
And paid out?---We did not pay them long service leave because they had only worked for 7 years.
PN204
Yes. But they were terminated. Okay. Can I now take you to paragraph 7. It is the evidence - and perhaps to the witness statement of Mr David Smith?---Sorry, paragraph of my statement?
PN205
Paragraph 7 of your statement?---Yes.
PN206
And then paragraph, bear with me, 5 of David Smith's. Do you have David Smith's witness statement with you?---Yes, I do.
PN207
Take your time?---Yes, I do.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN208
Now, I understand that on or around the 27th to the 29th, in fact, the 30th, there are a number of emails go back and forth, back and forth between yourself, Mr Smith and Mr Christie of Skyways in relation to the transition?---Yes.
PN209
It is the evidence of Mr Smith at paragraph 5 that you drafted a letter for him to send out to the employees on 20 - well, in fact, it is not stated, I apologise, it is not stated by Mr Smith. But he did send that letter out on the 29th to the employees?---That is correct.
PN210
That is correct. And that is the letter that is exhibited, I believe, to Mr Gadsden's witness statement at KG1 as an example of one of those letters. Do you have a copy? You do have a copy of Mr Gadsden's?---Yes, yes, I do.
PN211
And in fact it is dated the 28th?---Yes.
PN212
In your discussions prior to 27 of January, you obviously had some discussions with Mr Christie and/or Mr Brown of Skyways?---My first discussions with Skyways was on or around about 29 January when I emailed Mr Christie.
PN213
Okay. So that email at annex - I think, it is B, no, at C, at C, is your first contact with Skyways and can you go through that email for me?---I don't have a copy in front of me, if I can get it.
PN214
Certainly. I don't happen to have a spare copy, Commissioner, I'm wondering whether the applicant - the annex. Yes. Annex B. My copy is marked, that is all. Not it is B, C, you are right?---Sorry, I do have a copy. I have got my original email here.
PN215
Okay?---Dated 29 January at 3.14 pm?
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN216
Yes, that is correct. And prior to that there is the prior email?---Yes.
PN217
And in that email you put forward to Skyways and Mr Christie that you seek to have the transfer of entitlements our employees - of our employees and continuity of service for all of our employees in fact recognised by Skyways?---That is right.
PN218
Okay. And prior to that you obviously seek that they - that Skyway offer, in fact, employment to all of your employees?---That is correct.
[11.45am]
PN219
And you also state that you are wanting to ensure a seamless transition of business whereby employees continue their employment, merely changing employers?---That's correct.
PN220
Can I take you to annex D, and I remain at paragraph 7 of your witness statement, and that is Mr Christie's response, the day later, the 30th?---Yes.
PN221
At about 1.05 pm, and he says in the second paragraph: send out a letter of termination, there's no transmission of business, terminate the employees. Effectively, we don't want carry over. We are not going to take on the employee's accrued entitlements, there's no continuity of service?---That is right.
PN222
Is that correct?---Yes.
PN223
He also states that the Skyways Group will be conducting interviews, in the paragraph below?---That is correct.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN224
And he suggests that the Prestige employees at Portland make application for employment with Skyways in the same way as on the open market as such, effectively?---That is correct.
PN225
So in fact he provides no guarantee to you whatsoever that the employees will (a) get continuity of service, or in the first instance, secure employment with Skyways; in the second instance, obtain continuity of service; and the third instance, obtain transfer of their entitlements. Would that be true, would that be your summation of that letter?---The only thing that I will dispute is that what Skyways is saying, which as I said prior, in my 6 years of experience in change of contracts, that Mr Christie is never going to put anything in writing to say that we will employ the staff. He will go through the process of saying: that we will interview all the staff, and we will employ the best people for the job. In reality that does not happen. As I mentioned in my statement before, 99 per cent of the employees in my experience get taken on by the incoming contractor for two main reasons: (1) in my experience, change of contracts are predominantly done by price and not by quality of service, and that the client does not have an issue with the staff. And (2) when coming into a contract that they don't know anything about, it would be foolhardy not to employ the current contractors because they know the site. So whilst Mr Christie is, in my opinion, protecting himself by putting something in writing to say: that we will go on the open market to interview the staff, in my learned opinion, he was going to always employ the staff.
PN226
I may come back to this, but I will take you now to, Mr Murphy asked you some questions in relation to the witness statement of Mr Gadsden where he - I'm just trying to find the paragraph for you, where Mr Gadsden gives evidence of speaking with his colleague, Mr Lee, about circumstances at the Esso Longford Gas Plant site where there again was a transfer from Tempo which became Prestige, correct in that Prestige was bought out by the Tempo Cleaning Services Group?---Tempo acquired Prestige approximately 3 years ago.
PN227
That is correct, so that on or about 2001?---That would be correct.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN228
It is at paragraph 6 of Mr Gadsden's witness statement. Are you there?---Yes, sorry, yes, sorry.
PN229
You've got it? Okay. And Mr Murphy asked you to offer your opinion on the information contained in that paragraph, and if you just bear with me 2 minutes. I understand you said you weren't familiar with that specific instance?---No, I was employed by Prestige Property Services in March 1998.
PN230
Yes?---Tempo acquired Prestige in - - -
PN231
About 2001?---2001. In my time under the new management 2001, Tempo definitely did not have the Esso contract with Tempo, and nor was I a manager of it. So I'm very vague on it.
PN232
I understand that and I understand that actually Tempo Cleaning Service did have the - and I stand to be corrected on this, but I actually understand that Tempo, it was on or about 2001 that Skyways obtained the contract from - - -?---Okay.
PN233
- - - Tempo at the Esso Longford Gas Plant?---It was definitely prior to my time of when I moved from Prestige to Tempo.
PN234
Yes, and what - - -?---So I can't - - -
PN235
You agree that what Mr Lee recites in his witness statement is something akin to what you have said is the general occurrence where you have a contractor at a site and particularly in the cleaning industry, that an employee may well be in the circumstances when there is a change of contract, one day they will be working for one employer, and in fact the next day they will come at the usual time for their shift and they will be employed by the next contractor?---That is my experience of change of contracts. I cannot talk about this specific contract.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN236
I understand that, I understand that. What I would also put to you though is in a number of those circumstances, and if we are speaking generally in the industry, that where that does occur, and where in fact the employee moves from one employer to the next employer on the same terms and conditions, where there is continuity of service, is recognised and entitlements are transferred, that what will simply occur is a letter to the employee on either the last day of the contract or the new, stating that: you are now employed by X-company who recognises your continuity of service with your predecessor. The terms and conditions of your employment will remain the same, and the new contractor, whatever that may be, will continue, we will continue to pay your hourly rate as per the previous contractor. Would you in your 6 years of experience, would you say that wouldn't be the case where there is a seemingly, you know, not difficult transfer of contract where the employees just move one day to the next. Would you say that is what occurs?---Yes, I would just like to add that in Victoria the cleaners are mostly covered by the LHMU.
PN237
Yes?---And they are under the Federal Building Services Award.
PN238
Agreed?---When there is a change of contract, there is a portability of long service fund, which is managed by the union and the industry, and so any entitlements of long service leave, if an employee has been there for 3 years, those accrued 3 years are paid by the outgoing contractor into a portability of long service fund. That is to recognise the change of contracts, the nature of the industry, that contracts change all the time, that cleaners may in 3 years - within 5 years work for three different companies, that they should not be worse off by losing their accrued long service leave, so it goes into a fund. But if there are, when an incoming contractor comes on, they do not take on all the staff, our responsibility as an outgoing contractor of one of two things: (1) to find suitable employment in one of our other contracts, and that mostly happens because we may have a contract around the corner in the CBD, or if not, as a last resort we would then pay them redundancy based on what the Federal Building Services Award would be, yes.
PN239
But in terms of the - you refer there to the long service leave which I understand is provided for in the portability with the Building Services Award, but in terms of the accrued annual leave, and sick leave etcetera?---No, we pay that out, we never transfer it over.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN240
It is never transferred over?---From my experience - no. Our company's practise and the majority of companies' practice is the annual leave that is accrued is paid out by the outgoing contract. That is never transferred over. So the incoming contractor, those employees start with no accrued annual leave. They've been paid out by the outgoing contractor and that their long service leave is in a bank in the portability. No, we never transfer the long service leave, sorry, the annual leave is always paid out.
PN241
I put it to you that that may not, that it is not necessarily the case?---I will put it to you - - -
PN242
In your experience perhaps, in the 6 years, but I will put it to you that that is not the case in every circumstance?---I will put it to you that most members of the Building Services Council of Australia, which is formerly ABSA, which is an industry group, pay out annual at the end of a contract, that it is never transferred over to the incoming contract.
PN243
Okay.
PN244
THE COMMISSIONER: Ms Walters, we did have this arrangement that we were going to have an adjournment at 12. Is this a convenient time?
PN245
MS WALTERS: It certainly is, your Honour.
PN246
THE COMMISSIONER: We will be bringing you back of course, Mr Morgan, to complete your evidence and we won't swear you again, but we will excuse you for the moment and we will adjourn until we can get the technology in place.
<THE WITNESS WITHDREW [11.56am]
SHORT ADJOURNMENT [11.56am]
RESUMED [12.09pm]
PN247
PN248
MR MURPHY: Thank you, Commissioner.
PN249
Mr Smith could you keep your voice up?---Sorry.
PN250
Your name is David Smith (address supplied)?---Yes.
PN251
You are currently employed in the agricultural sector?---Unemployed - I did a couple of weeks work on a farm.
PN252
Yes, all right, and you were the Manager of Prestige at Portland for 4 years up until 29 February this year?---Correct.
PN253
You have prepared a witness statement, a one page statement, is that right?---Correct.
PN254
Do you have a copy of that in front of you?---I do.
PN255
Does that consist of six paragraphs on a single page?---Yes.
PN256
I would seek to tender that if I may, Commissioner, otherwise I will have to ask him to read it into the transcript. Sorry, it has been changed.
PN257
MS WALTERS: No, if it pleases the Commission, there must have been a - - -
PN258
MR MURPHY: I'm sorry, it has been changed.
**** DAVID SMITH XN MR MURPHY
PN259
THE COMMISSIONER: I have got nine paragraphs.
PN260
MR MURPHY: I see, is it a paragraphed witness statement - - -
PN261
MS WALTERS: We do as well.
PN262
MR MURPHY: - - - with nine paragraphs in it?---Six on the first page, three on the second.
PN263
Right, nine paragraphs?---Correct.
PN264
THE COMMISSIONER: That is a different format to mine but - - -
PN265
MR MURPHY: All right. Now, are the contents of that statement true and correct?---No.
PN266
Pardon?---No.
PN267
In what area is it incorrect?---If you look at paragraph 6.
PN268
Yes?---It is in the last two lines: I did give him copies of the rosters.
PN269
Yes?---That is incorrect.
PN270
You didn't give him copies?---I didn't give him copies and I contacted a Mr M.D. Murphy. He sent me an email. I returned it with: please find attached some small changes, Regards, David.
**** DAVID SMITH XN MR MURPHY
PN271
All right?---Now, I never got a return email from him confirming that, but I did report that to him.
PN272
THE COMMISSIONER: All right. So is it your wish to delete the words: I did give him copies of our rosters?---Yes.
PN273
MR MURPHY: Yes, and what other changes do you wish to make?---At this stage I can't see any.
PN274
I would ask that - so the rest of it is true and correct?---It is not correct.
PN275
What other parts are not correct?---
PN276
I subsequently contacted Mr Chris Brown of Skyways seeking to ascertain progress of the transition and when interviews were to take place. He did not return my call.
PN277
That is not entirely correct, because I could not contact Chris Brown, he wouldn't return my calls.
PN278
All right. So you subsequently tried to contact him, is that what you are saying?---That is correct.
PN279
And he didn't return your calls, okay?---That is correct.
PN280
With those two changes, is the statement otherwise correct, true and correct?---Yes.
**** DAVID SMITH XN MR MURPHY
PN281
PN282
MR MURPHY: Mr Smith, you had an interview with Skyways about a position?---Yes.
PN283
But you were unsuccessful?---Correct.
PN284
And, were you subsequently paid your outstanding entitlements by Prestige?---Yes.
PN285
All right. Are you aware as to how long each of the interviews for the other cleaners took?---No.
PN286
No, all right?---No.
PN287
Were you involved in the actual logistics of the changeover around 29 February?---I was unemployed from that date on.
PN288
No, before that?---No.
PN289
Did you have any dealings with the incoming manager?---I contacted Bruce Christie and he never got back to me from that day.
PN290
All right. Did you have any involvement in the vehicles that were provided to Skyways?---I was asked to leave all Prestige vehicles on the Portland Aluminium site with the intent of Skyways using them until the transition of their vehicles coming on site.
**** DAVID SMITH XN MR MURPHY
PN291
And did you do that?---They were, yes.
PN292
All right, yes that is the evidence of this witness.
PN293
PN294
MS WALTERS: Yes, just a few short questions, Mr Smith. You say in your statement in paragraph 1, you have been employed for 4 years as the manager on site at Portland?---Yes.
PN295
You say at paragraph 2 that you were not directly involved in the negotiation of the 2000 agreement?---Correct.
PN296
Mr Gary Mallen, was he your predecessor? Were you aware whether he - were you aware that Mr Gary Mallen was your predecessor, he was employed as the manager before you, is that - - -?---He was.
PN297
He was?---Yes.
PN298
Now, where you say that you weren't directly involved, can you just explain to the Commission what you mean by you weren't directly involved? Did you participate in any of the negotiations at all?---I really - it is 4 years ago, I can't really remember where I was. On 18 February, I started with the company.
PN299
Yes?---At that stage, the majority of the negotiations had been done. As you can imagine, as you well know, the EBAs take quite some time to ratify.
**** DAVID SMITH XXN MS WALTERS
PN300
Yes?---And it was over that - well, I was only there during the last period of that transition.
PN301
Okay. Did Mr Mallen explain to you, you know, in the transition when you then took over management of the site for the cleaners, did he go through those negotiations with you, so that you would have an understanding of the terms of the EBA?---No.
PN302
Okay. You say again at paragraph 2 that you understand that the redundancy clause in the agreement was in a standard form for all unions and employees at the Alcoa site. Now I understand that what you are talking about, that the Union has a number of certified agreements at the Alcoa site Portland, with various contractors, because there's quite a few contractors. Do you mean by that statement that the redundancy clause in the 2000 agreement reflects the same redundancy conditions in those other agreements?---I'm not aware of what is in the other agreements. I do know that the other EBA signed on the Portland Aluminium - well, not all but I've heard of some that have got a redundancy clause in there.
PN303
Okay, but you don't know whether that redundancy clause is the same as the redundancy clause in the 2000 agreement. No?---No.
PN304
Can I ask you what you understand the clause of the 2000 - the redundancy clause, at clause 17, What you understand that clause to mean?---I had no dealings with the redundancy, the clause or the - at any stage, because we weren't in that position.
PN305
Okay. When your employment was terminated, did the company pay you a redundancy?---Not as such.
PN306
What does: not as such mean?---I was paid out my entitlements.
**** DAVID SMITH XXN MS WALTERS
PN307
By your entitlements, do you mean your annual leave and your long service leave?---Correct.
PN308
Okay. So you were not paid the redundancy in accordance with clause 17, that is 2 weeks per year of service?---I argued that point with them, and no. I was paid a figure and it wasn't broken downs into what was there.
PN309
Can I ask you, are you aware of any other prior employee of Prestige that has not got employment with Skyways that was paid a redundancy?---Any previous employees from Prestige who no longer worked for Skyways?
PN310
Yes, were there any - whether you know of any of those that have - and I think there is only a couple, a few who no longer, who don't work for Skyways now, but of those people - - -?---Well, they would have been all casuals, you know.
PN311
No, I understand they weren't?---I thought all the permanent employees were picked up.
PN312
No, not all the permanent employees were picked up?---Well, again you have got to remember, I was unemployed at this stage, I don't know what was the Skyways outcome of their induction.
PN313
Okay. Just, bear with me a moment, Mr Smith. From the date that the employees - can I ask you Mr Smith, when did you first - have you had any discussions with the employees prior to your termination on the 29th, so in that month of January in between you being advised that Prestige no longer had the contract with any of the employees with respect to the loss of contract?---I called a meeting on the day after we were contacted, I believe, 20th or 21st of - - -
PN314
Yes?--- - - - the month and I explained to the employees that Prestige lost the contract.
**** DAVID SMITH XXN MS WALTERS
PN315
Yes?---And Prestige were endeavouring in every aspect to get them employment with the new company coming in.
PN316
Okay. At that meeting did any of the employees raise any ideas, concerns, or issues with you as their manager to relation to the change in contract?---I can't remember completely. What I do remember is the employees, the ones who did show up to the meeting - and I've got to stress there wasn't all of them, there was only a few that turned up - they were more shocked than there to be querying me on, you know, the ins and outs of what their future was going to hold. You know, I think it took all of them a little bit of time to come to grips with the fact that Prestige had lost the contract. Really, no, I don't think there was any formal questions about you know, where they stood.
PN317
So you say: no, at that meeting, that you have referred to in paragraph 4 of your witness statement - 3, sorry, I apologise, that no - and I believe, I will give you some names of a few people, a few of the employees that did show up, that I understand showed up. They are to be if you can recall, June Lovell, Greg Parsons, Johnny Hollis amongst a few others perhaps, at that meeting, can you recall?---Yes.
PN318
Okay, and not one of those individuals raised with you the issue of redundancy?---I can't remember.
PN319
Okay. I put it to you- - -?---The meeting was - - -
PN320
You can't recall?---I can't recall, sorry.
PN321
I put it to you in fact one of those individuals did raise that issue with you. Okay, and that your response was something to the effect of: you are going to be fighting to get your redundancies?---Why would I say that? I had no interest in, you know, at that stage. How could I make a statement like that?
**** DAVID SMITH XXN MS WALTERS
PN322
Okay. In paragraph 6 of your witness statement you refer to your attempts to contact Mr Chris Brown of Skyways, and I think you referred to Mr Bruce Christie as well before, that you contacted them with respect to securing employment for yourself and for the other employees, that is correct?---I contacted Bruce Christie to introduce myself to Bruce Christie, and I was more concerned about my position. I never mentioned the positions of the employees.
[12.25pm]
PN323
So you contacted Mr Bruce Christie because you were concerned about whether you would be retained as the manager at the site by Skyways?---Correct.
PN324
Okay. Did you speak to Mr Jeff Morgan about that?---About?
PN325
About securing employment with Skyways as the site manager?---Say again. Sorry.
PN326
Did you speak to Mr Jeff Morgan, your manager - - -?---Yes.
PN327
- - - in Melbourne about your attempts to try and secure employment with Skyways and contact - - -?---I told Jeff that I'd contacted Bruce Christie, and Jeff's attitude and his intent was clearly the, you know - his responsibility is to make sure the guys, our crew, were picked up by the incoming.
PN328
And that crew involved yourself?---Well, yes. Jeff was very adamant that he was going to be pushing for my role as well.
PN329
Okay. You have referred, and Mr Murphy took you to an interview that you had with Skyways and that you were ultimately unsuccessful at that interview. Did you make a formal application for your position?---I forwarded a resume. Once I'd spoke to Bruce Christie on the phone, he gave me an email address - - -
**** DAVID SMITH XXN MS WALTERS
PN330
Yes?--- - - - that I forwarded my resume and a cover note asking for my role basically, yes, what I do.
PN331
Okay. Did Mr Christie, when you eventually spoke to him and he gave you that email address, did he advise you about the process for application to be made aside from giving you the address; did he let you know that he would be interviewing other people or that the position was advertised?---Bruce Christie was very short and abrupt with me. His attitude was quite clearly that of someone who didn't care about my role in particular.
PN332
Okay. But he didn't tell you whether other people would be applying for that position or that it would be advertised?---No, no, no. His basic words to me were: if you were to give me the rosters that they are currently working on, maybe I'll be able to help you.
PN333
Okay. And that is where at paragraph 6 you say the inference is that if you provided the rosters, then he would give you a job?---Well, that was his - that was what he was getting at, and I thought it was inappropriate that I give away anything to another company as in the rosters.
PN334
Okay. Thanks, Mr Smith. That is all, Commissioner.
PN335
PN336
MR MURPHY: Just one question, Mr Smith. You indicated that, in fact, you were paid - there was a payment made to you when you were terminated by Prestige?---That's correct.
PN337
And that didn't break down what it related to?---It was annual leave, sick leave - sorry. Annual leave - look, all your entitlements that you are entitled to, I guess.
**** DAVID SMITH RXN MR MURPHY
PN338
I suggest you actually also got paid redundancy - 2 weeks per year of service?---I possibly could have, too. Jeff and I had discussions about my payment, and at the end of the day I was rather surprised because I was paid.
PN339
Right. And you were asked about your conversations with Mr Christie. He didn't appear to want to assist you, is that right?---Mr Christie was very short and abrupt - - -
PN340
Yes?--- - - - and didn't want to assist me at all.
PN341
But your conversations with Mr Morgan were to the effect that he was going to make the representations on behalf of both you and the whole crew to Skyways?---Sorry. I don't understand, sorry.
PN342
You had a conversation with Mr Morgan to the effect that Mr Morgan was going to take the action to see if you and the others could obtain employment with Skyways?---Yes. Jeff forwarded me a letter that he drafted that I hand delivered to each of the employees, and that was a letter of intent that basically says that we had lost a contract and Prestige's obligations in making sure that you guys were all picked up by the incoming contractor.
PN343
And after that - - -?---At that stage, at that stage - this is early in the piece when we'd just found out that we'd lost the contract - at that stage we were not certain of who the incoming contractor was.
PN344
But after that Mr Christie - sorry, Mr Lawrence - sorry, Mr Morgan took action that you are aware of to try and get employment for the employees?---Absolutely, yes. He emailed Bruce Christie and he courtesy copied me on those emails, and Bruce Christie's attitude was negative. But Jeff Morgan was trying very hard to get everybody re-employed.
**** DAVID SMITH RXN MR MURPHY
PN345
Yes. That is all the evidence I wish to lead from this witness. May he be excused?
PN346
PN347
MR MURPHY: Recall Mr Morgan.
PN348
THE COMMISSIONER: Yes. How long do you think you will be?
PN349
MS WALTERS: Commissioner, I envisage and - if it pleases the Commission, I am relatively raw at this and find it very difficult to give you an estimate, but in the vicinity of half an hour, three-quarters.
PN350
THE COMMISSIONER: Half an hour to three quarters of an hour.
PN351
MS WALTERS: Yes.
PN352
MR MURPHY: Well, I was almost tempted to ask the Commission whether I could interpose Mr Brown. He is not our employee. He is sitting around outside. He has come up from Portland, and I get the impression from my friend that his evidence may be a bit shorter than Mr Morgan's so, I mean, he could then be sent away.
PN353
THE COMMISSIONER: Yes. Do you have a problem with that?
PN354
MS WALTERS: No, Commissioner, I don't. Just if I may ask the Commission with respect to the oral submissions that I referred to earlier. Perhaps it may be best if we deal with them, if it pleases the Commission, prior to the respondent calling Mr Gadsden.
PN355
THE COMMISSIONER: Yes, that is fine. I am mindful of that. I had not lost sight of that.
PN356
MS WALTERS: Thank you, Commissioner.
PN357
THE COMMISSIONER: But I think we will do that, we will call Mr Brown and we will try to discharge him before we have lunch.
PN358
MR MURPHY: Yes. Thanks, Commissioner.
PN359
PN360
MR MURPHY: Mr Brown, could you state your full name?---Christopher Andrew Brown.
PN361
All right. And you are employed by Skyway Management Proprietary Limited?---Correct.
PN362
And what is the business address of Skyway Management Proprietary Limited?---It's Prince Patrick Street in Richmond.
PN363
Right. How long have you been employed by them?---Approximately 12 months.
PN364
Right. And you have been approached by Prestige in relation to this matter involving the Portland Refinery and the cleaning contract and you have prepared a witness statement, or had prepared a witness statement of four paragraphs, is that right?---That's correct.
PN365
Do you have a copy of it with you?---No, I don't, sorry.
PN366
Right. Would you have a look at this document here? Have you recently read the statement, Mr Brown?---Yes, I have read it, yes.
PN367
And is there any changes you wish to make or is it otherwise correct?---I will just read - I will have another look to make sure. Yes, that's correct.
PN368
**** CHRISTOPHER ANDREW BROWN XN MR MURPHY
PN369
MR MURPHY: Mr Brown, when were you first involved in relation to the successful winning of the contract at Portland from Prestige?---We were notified in late January that we'd been successful in the contract.
PN370
And at the time you were successful, did you have any view as to what you were going to do with the - who you were going to use to man the contract to perform the services?---No. Look, I think basically we were at a situation there where we wished to throw all positions open for external applicants and basically try to assemble the best crew possible for the task.
PN371
Have you been involved in the contract cleaning industry for some time?---Yes, I've probably had 15 years in the cleaning industry.
PN372
And the general practice is, in relation to industrial type contracts, that the staff are often kept on, isn't it?---Yes. Look, in a lot of cases they are, yes.
PN373
And that is what happened here, isn't it?---Yes. It wasn't a transmission. We certainly spoke to, as I said, other applicants as well, and we wanted it made quite clear through ourselves and through Portland Aluminium that it wouldn't be a transmission of business and we would open positions, and that was at the request of Portland as well as ourselves.
PN374
Yes?---And basically we moved forward then to obviously interview the existing staff with a view to their suitability and also call for, as we said, people from within the broader community as well.
PN375
Yes. And you said you didn't want it to be a transmission of business. Is that because you didn't want to have any liability for any accrued entitlements?---Look, basically, yes. We thought if we had picked these people up with a transmission, obviously there's some long serving members there and, yes, basically we didn't want to pick up those entitlements.
**** CHRISTOPHER ANDREW BROWN XN MR MURPHY
PN376
Right. And did you have discussions with Mr Morgan as to the rosters that they were using to fill the contract?---Yes, we did.
PN377
Did he in fact provide those rosters to you?---He did provide rosters, yes.
PN378
And did that include the names of the people who had been manning them?---Yes.
PN379
And so, as things panned out, it was quite a seamless transfer as far as Skyways were concerned?---Yes, look, it did go fairly well in the end. It basically was reasonably seamless, yes.
PN380
And you re-engaged most of the employees, except for the manager and a couple of other people who were on Workcare, is that right?---That's correct. In the end there was 12 people that we gave full time employment to and two casuals.
PN381
Yes?---And that was from the existing pool, yes.
PN382
Yes. Did you have any - did any new blood come on to the site at all as at day one?---No, not as of day one, no.
PN383
Right. Were there any changes made to the - I withdraw that. When you put out the request for tender, when the request for tender was put out by Alcoa, was there anything contained in it about the terms and conditions under which the employees were to be engaged?---Yes. It just did stipulate there was a site agreement, that people engaged on the site are under a site agreement or an EBA.
PN384
Did you subsequently - have you met the EBA or employed people on that basis?---Yes, look, we believe that we have met the EBA in its entirety and paying all the terms and conditions pertaining to that EBA to the current employees.
**** CHRISTOPHER ANDREW BROWN XN MR MURPHY
PN385
Are you aware as to whether there has been a fresh EBA certified as distinct from the one that was certified in 2001?---No, I don't believe there was a subsequent agreement that was certified. Everybody speaks about there was an agreement in principle with an EBA it just wasn't certified. So Portland Aluminium, obviously Prestige and ourselves acknowledged that there was an EBA there that the current staff are working under and as such, agreed to pick that up in its entirety.
PN386
Right. As far as you are aware, has there been any changes at all to the terms and conditions of the staff, in terms of the number of hours they work or their status?---Look, I believe without really fully knowing what the hours were that they worked in the past, there's a 36-hour week applies to the site and to our knowledge all people that are full time are still working the 36-hour week, so I don't believe as far as their full time permanent situation that it has changed. We have also got static day and afternoon people on top of rotating shift people that also work a 36-hour week, and as I said, supplemented with two casuals. So I believe, no, it's been maintained.
PN387
Right. Did you use the Prestige vehicles for the first month or so of the job?---Yes, Prestige made available their vehicles, which we appreciated, to help us in a transition when we had a couple of hiccups obtaining our own site vehicles.
PN388
So is the site so big you need a car to get around from place to place, is that right?---Yes, we've got three site vehicles used to transport the staff from A to B, etcetera.
PN389
Yes, all right.
PN390
THE COMMISSIONER: Of the relevant persons that were taken off, are they all still in employment or have any been dismissed or released?---No, they're all still employed.
**** CHRISTOPHER ANDREW BROWN XN MR MURPHY
PN391
Thank you.
PN392
MR MURPHY: I take the witness to annexure G of Mr Morgan's statement. Starting from the back you will see a document headed: Annexure G?---What document is it?
PN393
Well, starting at the back if you just keep flicking back, you will see a document that has got a cover sheet, annexure G, it is about 15 pages thick?---The payroll report?
PN394
Yes, the payroll report?---Attention: Jeff Morgan?
PN395
Yes?---Yes.
PN396
Now, is that the list of the employees that you had down there as at April from your payroll administrator?---That is correct, yes.
PN397
Over the page is actually the payroll advices in relation to each of those employees, their hourly rate, etcetera?---That is correct.
PN398
Now, if it is said to you that the terms and conditions of these employees are worse than, or different from what they were under when they were employed by Prestige, what do you say about that from your knowledge?---No, I don't believe the individuals' terms and conditions are worse.
PN399
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN400
MS WALTERS: Mr Brown, can I take you to paragraph 1 of your witness statement?---Yes.
PN401
You state that you are employed at Point Henry site and at Alcoa, Portland sites as the regional area manager?---Yes, that is correct.
PN402
Does that interchange with transitional manager or is your title regional manager?---It is basically regional area manager but - - -
PN403
Okay. But in fact you have been involved in the transitions from having grabbed the contracts from Prestige and Skyways?---That is correct. The cleaning industries are fairly multi-skilled with the management side of things so you have to wear various hats, yes.
PN404
Yes, I understand that. Can I ask you about the transition at Point Henry, Geelong?---Yes.
PN405
In terms of the transition which I am to take it, you managed that transition as well?---I didn't really manage as such down there because I'd only been brought on to the company basically when they obtained the Point Henry site. I have got some brief knowledge and I did have some brief dealings with the site, so.
PN406
Can I ask you, Mr Brown, who did you work for prior to Skyway Management?---CMC.
PN407
CMC, okay. Just bear with me a moment, Mr Brown? Mr Brown, in terms of the transition, and obviously your familiarity is not as much as for this one at Portland, were the employees paid out their entitlements?---At Point Henry?
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN408
Yes?---Yes.
PN409
And the position of Skyways was the same as it is at the Portland site or has been at the Portland site, that there was no transmission of business?---Correct.
PN410
That Prestige at Point Henry were to terminate and pay out entitlements?---Correct.
PN411
Are you aware of whether it was advertised on the open market, the positions available at Point Henry?---It wasn't at Point Henry, no.
PN412
Okay, so it was not advertised?---No.
PN413
But the work-force that was working under Prestige moved on to Skyways in its entirety?---Correct.
PN414
Okay. In terms of the tender that occurred at Point Henry, as part of that tender process was there any undertaking given as to the work-force?---As far as?
PN415
The work-force, so in terms of the tender process and the tender put forward by Skyways, or indeed the requirements put forward by Alcoa Point Henry, was there any mention or discussion of the work-force? Was that provided for in either side of the tender process?---Basically not, no.
PN416
No, they were silent?---Yes.
PN417
Okay. Did they have the same provision with respect to the EBA?---Yes, correct, yes.
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN418
So they did have the same provision that Skyways would have to honour the EBA that was enforced - - -?---Yes, all current conditions, terms and conditions - - -
PN419
Yes, in Geelong?--- - - - in the existing signed EBA, yes.
PN420
Yes, but it was silent as to work-force?---Yes.
PN421
Okay. I will use the term "transitions." Where Skyways has taken contract from another contractor at a site, how many approximately of those have you been involved in, whether it be Prestige or any other contractor?---20.
PN422
About 20? In your experience, is it general practice that there is a transmission of business?---No.
PN423
Is it general practice that the work-force is taken over?---In some instances that is the case and others, no. So probably, more so the affirmative than the negative.
PN424
Okay. So it is a bit unusual to not just take the work-force over but to advertise on the open market?---Obviously there is a lot of points to take into account before making that assumption and basically the key reason is why was the tender put out in the first place.
PN425
Indeed. Can I stop you there, Mr Brown? In terms of why was a tender put out in the first place, in your experience again, in those some 20 take-over situations, would you say it is often the case that there are undertakings given? Obviously the union is involved often in terms of the transition from one contractor to another. You have got the four entities and discussions with both parties with respect to the existing work-force?---Yes, where the union's involved that would definitely on the majority of cases be correct, yes.
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN426
Yes. So you would see, generally in a lot of those circumstances you would see a form of continuity of employment?---As I said, the cleaning industry is a different award obviously to the metal industry and there is no real definition of redundancies in custom and practice within that industry as, yes, cleaners have got a portability of long service but there's certainly no real redundancy where there is an end-to-end contract. So basically it is acknowledged that any incoming contractor picks up - if he does pick up any existing contractors, there is certainly no prior service recognition or no redundancies paid to those people because it's a situation, a Friday to Monday situation where those people are employed doing the same thing at the same place just for a different company where they acknowledge that they start from zero.
PN427
Yes. But in terms of years of service and that being recognised, isn't it the case that the new contractor - because we are talking about the Building Services Industry Award here, that they actually recognise that the length of service of a cleaner who has been employed by Prestige, Tempo, Skyway Executive before Skyway Management, that in fact a cleaner in this industry could have been employed by six or seven different employers but when it is at the seventh employer, that individual would be taken to have had 10 years of service - continuity in that 10 years of service because of the nature of the award. In fact, if at that seventh employer, the individual was made redundant, those 10 years of service would be recognised because of the award which provides for that continuity of service?---I can't quantify that at 100 per cent. I didn't think that was the case. I thought the differential there was the portability of long service, so there's definitely recognition through an industry fund of portability of long service because the industry accepts that there's a huge turnover of contract companies and the client would certainly recognise that cleaner had been there for 10 years. But I think as far as the individual company, I can't quantify that 100 per cent that that would be the case.
PN428
In terms of this particular site, Mr Brown, I can't recall the question Mr Murphy asked you but in terms of this particular site you and Mr Christie, or should I say Skyways stipulated, no transmission of business in particular because you didn't want to have the liability of the accrued entitlements of the five or six, I understand it to be, employees who had 14 years of service?---Basically there was an intention there and as we said to go into the
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
open market-place, so really we wanted all cards on the table from day one for everybody to recognise that even the existing staff or anybody, it wasn't a given that anybody would be given a job. All people would need to apply for positions.
PN429
Okay, so it was not only about the liability of the entitlements, it was also about you wanting a crew that was to the best of their abilities and that fitted the site and not necessarily made up of the previous work-force?---Correct.
PN430
Okay. Can I take you to paragraph 3 of your witness statement?---Yes.
PN431
On the second page, and if we start at the sentence:
PN432
After calling for outside applicants through an advert in both the Portland Observer and Hamilton Spectator to test outside applicants because of a tight time frame
PN433
There is no full stop but then there is a capital letter:
PN434
We offered most of the ex-employees positions with Skyways, although there were some changes to the rosters.
PN435
Now, that reads as one sentence. Does it in fact, or is it two sentences?---I'd say it should really be two but there's obviously no full stop there in it.
PN436
Okay. But there is a junction there. Can you tell me, was it because of a tight time frame that you offered most of the ex-employees positions?---That was certainly one of the contributing factors because we had a month to transition a site the size of Portland, which is a fairly monumental task on its own for anybody that knows anything about transitioning those type of jobs. So we were sort of well into the situation of a couple of weeks before we really were in a situation to go out to the outside market for applications. In the end,
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
although we ran all our interviews and etcetera, with the existing staff, time did start to elapse a little bit. So, yes, we believe that the best light, we were reasonably happy with the existing employees after speaking with them and after running our own internal interviews with those people that they could possibly fill the positions to what we required anyway.
PN437
Did you interview anyone in response to the advertisements placed in the Portland Observer and Hamilton Spectator?---Only by phone. We had certainly spoken in broad terms on the phone to numerous people but again, to certainly get those people in at the last minute to have medical examinations and have them ready to start on March the 1st, police checks, etcetera, was very hard.
PN438
So in fact, individuals did make application but they were denied employment on the basis that you did not have time to get them in for the set up and be ready for the month?---Yes, there was basically a hell of a lot of people applied.
PN439
Okay, so in terms of the seamless, you responded to a question of Mr Murphy with respect to the transition and transfer that it was a reasonably seamless transfer. In fact was it from your behalf?---Yes, look as far as we were concerned, obviously the employees that we picked up knew the site fairly well. They were fairly close to the same rosters, etcetera that they were on. We formed a consultative committee to work through any issues with the staff, and I believe all in all, it went fairly well.
PN440
That is good. Can I ask you, was anyone employed as a result of the application process made during the - well the period for the advertisement placed in the Observer and the Hamilton Spectator?---No, not at this stage, no.
PN441
So you haven't employed a single individual, post taking on the contact at Portland Alcoa from any advertised source or from in fact any other word of mouth source, but you haven't employed a new casual cleaner at Portland?---Yes, look there's one person that came on to do a, well what would you call it, an ad hoc job. That person was an actual relative of mine that had worked with the company in Melbourne and basically lived in Portland, so he got a week's work out of it, but that is the only situation. That was never an ongoing situation.
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN442
And that individual's name is?---Peter Zordin.
PN443
Okay. So that was just a week's casual work?---That was just a week's casual work so.
PN444
It is not ongoing employment of any type?---No.
PN445
Okay. In terms of - you have said that you believe that there are no - there's, the terms and condition of employment of the employees when they were under Prestige are exactly the same as they are now under Skyways?---Correct.
PN446
And there is absolutely no disadvantage to the employees?---No.
PN447
Okay. You have referred to the 36-hour week?---Yes.
PN448
The employees at Prestige were working on a weekly basis, the rosters would exhibit this, 2 hours overtime per week, which was overtime but it was offered on a - in fact not even offered on a consistency based, it was actually part of the roster, and those 2 hours were at penalty rates?---That would be correct. If it was after 36 hours, it would, yes.
PN449
Was that reflected in the rosters provided to you?---We certainly knew that the component of weekend work and as you said, kicked into overtime certainly exceed the 36-hour week. However, we had an obligation to divide the amount of hours that we had into full time employees.
PN450
Yes?---And we felt that is what we've done and we felt that we had done that fairly well and been able to employ 12 people full time.
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN451
Yes?---And as far as we were concerned when we talk about all terms and conditions, it states a 36-hour week. We've employed people under a 36-hour week, we all know that overtime is not a given, it can disappear at any time and anybody that stipulates a lifestyle choice on overtime may come a very big gutser one day in their career. So yes, we believe as far as the 36-hour week, as far as the rates of pay, as far as Incolink, as far as any other clauses within that EBA that we believed we wanted them to the fullest.
PN452
But you accept that in order to take on 12 full-time individuals as opposed to a reduced number of full time and more casuals, that there was a change to the roster, you accept that?---I accept - - -
PN453
Intentions behind it?---I accept that, but I still can't sit here and say that the specifications we quoted on were exactly the ..... specifications without actually having both of those situations in front of us.
PN454
I see?---But certainly, yes, the hours that we've put in and the rosters we've put certainly sent the specifications that were tendered by Portland Aluminium.
PN455
Is Skyway looking at the rosters currently?---As far as looking at implementing any change? Yes, certainly we would be, yes.
PN456
Okay. Can you explain to the Commission what those changes are going to be?---What we are looking at the moment is a situation where we've got current staff working 14, this is on a rotational shift. They work 14 shifts at 10.3 hours, which give a 36 hour week. What we would look at implementing through consultation with the union is 16 9-hour shifts which would still give the 36-hour week.
PN457
Okay?---And again, that can only be obtained through a major consultation clause as well in the EBA.
**** CHRISTOPHER ANDREW BROWN XXN MS WALTERS
PN458
Yes, and you would agree that it would involve hour by minute minimal, but a further reduction in hours and total pay?---Not in hours, but in total pay.
PN459
Pay, yes?---But as I said, this is only a situation that has been tabled for discussion through the appropriate channels.
PN460
Yes?---It is not accepted yet.
PN461
In terms of - it was stipulated in the tender process the in-principle site agreement that is currently in place that Skyways agreed to provide the same terms and conditions and in fact follow that certified agreement?---Yes.
PN462
Yes, and you were aware that that certified agreement has a redundancy clause in it, a clause 17?---Yes.
PN463
Yes. Were you aware that the company had been paying Incolink as well?---Yes.
PN464
Are you currently paying Incolink contributions to your employees?---Yes.
PN465
Okay. Are you in the process of negotiating with the union to certify a new certified agreement?---Yes we are, yes.
PN466
**** CHRISTOPHER ANDREW BROWN RXN MR MURPHY
PN467
MR MURPHY: You were asked a number of questions about the general practise in relation to changeovers of cleaning contracts, and you are saying that - you said that in general it is not the practise that there be a transmission of business, but it is more prevalent than not that the employees are in fact there on a Friday to Monday arrangement. They restart on the Monday with the next contractor?---That's correct.
PN468
And that applies in your experience mostly in these sort of industrial cleaning areas, is that right?---Certainly, in a lot of cases, yes.
PN469
So that the question of a redundancy for the employees usually does not arise?---Like I said, it is - I can't recall the last person within the cleaning industry under those terms that got a redundancy under the Building Services Award.
PN470
Right. Okay. It was put to you that these employees in a sense have lost service-related credits but aside from redundancy benefit and long service leave, what other benefits are there in relation to how long you have been employed by a particular company?---Look, obviously there's no staged increments yearly, so I believe that is the major situation just, yes, the long service and redundancy clause, yes.
PN471
Under the Building Services Award, that is picked up by a portable long service leave?---That is correct.
PN472
All right, yes, that is the re-examination of this witness, Commissioner, may he be excused?
PN473
THE COMMISSIONER: Yes, thank you for the evidence, witness, you can go.
**** CHRISTOPHER ANDREW BROWN RXN MR MURPHY
PN474
PN475
THE COMMISSIONER: I think we will adjourn now till 2.15. Can I just ask you, and it is a bit late to be saying this, Mr Murphy, but can I ask you to caution Mr Morgan about discussing the evidence until he is recalled.
PN476
MR MURPHY: Yes, yes I will undertake to do that, yes.
PN477
THE COMMISSIONER: We will adjourn till 2.15.
LUNCHEON ADJOURNMENT [1.03pm]
RESUMED [2.17pm]
PN478
MR MURPHY: Mr Morgan was being cross-examined. If he could go back to the witness box.
PN479
PN480
MS WALTERS: Mr Morgan, as I recall about where we finished off previously, we were talking about - you were talking about the Building Services Award and the different provisions in that award in terms of portability of service, and effectively redundancy. Mr Morgan, I understand that you have stated previously that you weren't in person privy to negotiations between the union and Prestige at the 1997 agreement and also the 2000 agreement prior to the certification?---That's correct.
PN481
You weren't present, and let us just say - we will ignore the 1997 because you weren't employed at that stage by Prestige?---That's correct.
PN482
So that is correct isn't it?---Yes.
PN483
Okay. The 2000 agreement, as manager of Prestige, that is correct?---At that stage in 2000, I had a split responsibility for the State.
PN484
Yes?---And Portland in the year of 2000 did not come under my direct control at that stage.
PN485
Okay. But, Mr Morgan, you would be aware of the certification process and you would also be aware that the Metal Award was provided for in that agreement as the parent award for purposes of the no disadvantage test. Okay, you would be aware of that?---That's correct.
PN486
Yes, and you would also be aware that the employees voted on that agreement?---I'm not aware of that.
PN487
As part of the Workplace Relations Act they are required to vote for that agreement, in favour of that agreement, and another responsibility of the company is to ensure that that agreement is explained to all its employees. Can you answer or can you give us some information as to whether the terms and conditions provided for in the EBA were explained, and would you understand them to have been explained to the employees?---I would consider that correct, yes.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN488
Okay, and you agree that it would have been explained to the employees that the redundancy and severance pay provided for in clause 17 was a part of that agreement?---Yes.
PN489
And you also agree that it would have been explained to them that the company would be paying $25 into the incoming fund?---Yes, that is right.
PN490
Okay, thank you. Can I take you back to paragraph 8 of your witness statement?---Yes.
PN491
At paragraph 8, some three lines down you state that the union representatives did not raise any matters of concern in relation to the actions of the company?---That's correct.
PN492
And then later on, you state that the first - in paragraph 11, sorry - the first time the union raised the question of payment of redundancy was on 18 March, which was the meeting at which Caesar Mellen, the assistant secretary, attended along with Barry Tennant and Ken Gadsden at your offices?---That's correct.
PN493
Okay, so if we take you back to the meeting which is referred to in paragraph 8 again in the first instance, in the first three lines, where you state that you went to Portland and there was a meeting on the 10th, and if I take you to the witness statement of Mr Gadsden and he effectively refers to the same meeting at paragraph - well 7, 8, 9 and 10?---No. Mr Gadsden's statement does not mention anything about the meeting on 10 February.
PN494
Yes, okay. At the meeting which you refer to on 10 February, can you recall who was present aside from Mr David Smith, Mr Barry Tennant, Mr Gadsden and yourself?---To my recollection, they were the people that attended the meeting. Having thought about it again, now, I think there might have been another representative from the AWU there.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN495
Okay?---Or, sorry, or it could have been now Josie Lowdon might have attended who is another cleaner. I think she attended a bit later, but not at the start of the meeting.
PN496
Miss Simmonds didn't attend that meeting?---Definitely not.
PN497
Mr Chris Brown didn't attend that meeting?---Definitely not.
PN498
There was no meeting convened in early February, or indeed effectively late January at which you, Mr Gadsden, Mr Tennant, Mr Chris Brown and Miss Simmonds were present?---Definitely not. The only time that I went to Portland from the time that we were advised the contract was on 10 February.
PN499
Okay, and you state that at that meeting on the 10th, neither of the union representatives raised any question as to redundancy - - -?---No, the whole - - -
PN500
- - - or severance pay?---No, the whole question, the whole purpose of the meeting was from our company's perspective to assure the AWU and our cleaners, and that is why Barry Tennant, the shop steward, was there, that we were going to be conducting and had already had a number of discussions with the management of Skyways to ensure that our employees were being picked up by the incoming contractor. That meeting only went for approximately half an hour;, that was the only issue that was talked about. Then I went on and updated Glenda Simmonds at a separate meeting after that.
PN501
Okay. You've stated previously that - I will take you to your witness statement at paragraph 11 where you refer to the meeting on 18 March?---Yes.
PN502
You explain that there were some minor issues relating to entitlements?---That's right.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN503
You have said before when Mr Murphy was taking you through your statement that all of those issues relating to recognition of service for the purposes of long service leave were resolved?---What the meeting was about was that Ken Gadsden and myself had had a number of phone calls prior to the payment and just after the final payment of annual leave entitlement and long service leave entitlement. We both agreed that perhaps there may be some inconsistencies when we pay the employees and we agreed that rather than take each individual case, that once they all received their final payment, Mr Gadsden would then draw up a list of issues, and then he was to talk to me about them so that we could come to a resolution. Mr Gadsden made a phone call to me and suggested that he actually spoke to me face to face about those issues. He presented, and I then brought our payroll officer, Marialla Bernardi in there as well, because obviously she was going to have to investigate those claims. At that meeting, there were a number of issues. One issue, which still hasn't been resolved today, is our records show we won the contract 14 years ago, and therefore the length of service is 14 years. The union believed that there were a number of employees that actually worked for us for 17 years, that in fact there was a small contractor that had the company for 3 years prior to us. There was a transmission of business then, that is what they believe, and that therefore their length of service is 17 years. At that meeting, I said to Mr Gadsden and to Barry Tennant: look, we have to do an investigation and go back to find out whether or not that company actually paid us money to that, and if that is the case, we will look at that. That issue still today has not been resolved. However, there was an understanding that we would both work to find out what the resolution of that is. There were a number of other issues in relation to rostered days off that were - that we hadn't accounted for, that hadn't been paid, and there were some issues in relation to some people hadn't been paid their - there were also some people that there might have been 1 or 2 days that they were querying in relation to their annual leave entitlement. I made a decision there and then that I accepted on face value everything barring the 14 versus the 17 year, that we would - that the amount wasn't a lot, that we would pay that, fix it straight away. That was the decision and it was put to bed.
PN504
Yes. Can I take you back to that meeting and it was raised at that meeting recognition of the service of Diane Atkinson, who I believe used to be maybe on your records as Diane Hilderbrand?---Right, and what is the - sorry the question?
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN505
The question is, or I put it to you that in fact the recognition of service in terms of long service leave has not been resolved in terms of Diane Atkinson?---I can't answer that at the moment, as to why it has not been resolved, I don't know.
PN506
Okay. Mr Murphy took you through your statement and when you were referring to the meeting on the 18th you made comment that - to the effect of you were very surprised by the union raising the issue of redundancy or severance pay, as such?---That's correct.
PN507
Because you believed that there had been a transmission of business and therefore it didn't apply?---I was surprised that the word or the mention of redundancy was ever raised, because in the prior 5 weeks, I had no such discussions with any union member about redundancy. When Mr Gadsden made the appointment with me, the sole reason for that meeting was to talk about the issues that we've just talked about. No mention of the word "redundancy" was made on those telephone calls, and then when we had the meeting, the meeting started talking about the resolution of those issues that I've just talked about, and then once I made that decision in terms of paying all these people all of that claim, Mr Gadsden or Mr - the assistant secretary then said - - -
PN508
Mr Mallen?--- - - - well, now let us talk about redundancies.
PN509
Okay. Mr Morgan, you state that you were surprised about the union bringing up the issue of transmission of business. Do you agree that there were a number of emails which you have annexed to your statement where the very issue of whether or not there has been a transmission of business was raised on a number of times, in fact where you actually at annexure D - E, I apologise - no. At F, annexure F to Mr Morgan's statement, your statement, there's an email on 9 February to Mr Bruce Christie where you say, in the second paragraph:
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN510
In relation to your comment about transmissions of business, I am not clear about what you mean by that, or the reason you have asked for all entitlements to be paid to our employees. Can you please explain more clearly.
PN511
And then you move on to the third paragraph where you request in effect information which goes to the effect of: the action size we will be taking to employ the existing work-force. But I put it to you that the idea of transmission of business and whether or not in fact a transmission of business had occurred was at issue from at least 27 January?---If I go back to the question of why I was surprised about the issue of redundancy was, that in our opinion, we had done everything right in terms of encouraging Skyways to employ the people. We had advice at that stage that everyone that came on board by Skyways had come on board on the same conditions as what we had paid. So therefore, my layman's view of it, if you would like to call it that, was why should we have to pay redundancy to these employees when in effect in my view they hadn't been redundant. Yes, David Smith had, yes, a chap by the name of, I think, Timothy Young had, and for sure, we obviously have to pay redundancy for those people that have lost their jobs. But for the majority, the 17 people or whatever, in our company's view, it was just as straight that they left work on the Sunday, they said goodbye to Tempo, or Prestige, and they started work on Skyways and everything moved on. So that is why my statement about the surprise was basically: well, why should we be paying redundancy, and that was the issue, and it wasn't heated, but we had some stern words, firm words between the Secretary of the AWU and myself about both views on redundancy.
PN512
Indeed. Can I take you back to the paragraph at annexure F that I've referred you to, the second paragraph where you state:
PN513
In relation to your comment about transmissions of business, I am not clear what you mean by that, and can you explain the reason why you ask for all entitlements to be paid to our employees.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN514
Can you explain to the Commission what was the purpose of asking that question to Mr Christie?---If you can just - I will get that.
PN515
Yes, I apologise, Mr Morgan, take your time?---Well, my view there was, I had sent an email to Mr Christie congratulating for the contract identifying to say that we are wanting to do everything to encourage the transfer of the staff over to them to encourage them to be picked up. Mr Christie sent an email back saying: there's no transmission of business and to issue early termination letters to all the staff. Well, I took that as that we had already given them - we had already given all our employees notice, we weren't to issue, we weren't to terminate these employees now because we have a contract until 29 October. We had to fulfil our obligations until that contract, so we cannot terminate any employee until the end of the contract. So I was seeking more clarification from - because I thought Mr Christie's response to mine was a bit ambiguous, and I never received any clarification.
PN516
Okay. Can I refer to that email at annexure D that you have just - this is the email where Bruce Christie replies to your original email which is at C, and he does in fact say Skyway request that Prestige provide early letters of termination to all current employees. Now, your understanding of what is meant by "early letters" means in fact to effectively terminate the employees prior to the conclusion of the contract. It is not to accord with notice and, you know, to give the appropriate letter not any later so that the notice provisions are complied with?---Well, in my experience, and in consultation with the LHMU in previous cases, we have been encouraged not to actually terminate any employee, or give them a letter of termination because of the risk of the lack of morale in between the transitional period so - - -
PN517
Can I put to you there, Mr Morgan, also that one of the reasons in consultation with the LHMU that letters of termination are not issued is because in those instances there may well be the bone fide transmission of business where in fact the employee's entitlements roll on and there is no need, you do not terminate the employee until it takes up employment with the new contractor?---Well, we terminate every employee.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN518
Yes?---At the end of the contact.
PN519
Yes?---Unless those people have not been picked up by the new incoming contractor and as I mentioned before, then we have two choices what we do, we try and encourage to find them another position.
PN520
Yes?---If we cannot do that, unfortunately we then have to make them redundant.
PN521
So to get it clear, if you terminate at the end of the contract, if you go through the notice provisions in terms of termination, they move depending on the length of service, between 1 and 4 weeks?---Yes, that is right.
PN522
So you would issue a letter of termination providing for notice to enable those employees to work out that notice period, or you would pay that notice period out upon effectively terminating that employee with its letter of termination?---You have confused me a bit.
PN523
In terms of, we are talking about the idea of early letters of termination. And we are not referring to LMHU, but this agreement, the notice provisions for termination depending on an employee's length of service, range from 1 to 4 weeks, in fact 5 weeks in instances where the employee is over 45?---That's correct.
PN524
So you have got two options. You terminate, give notice of termination that your 4 weeks, 3 weeks, 5 weeks, whatever the case may be, to the employee, in accordance with the date of the termination of the contract?---Yes.
PN525
And that employee works out its notice period?---That is right.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN526
Okay. And I'm asking a question about the previous circumstances that you have just referred to with the L - - -?---HMU?
PN527
Yes. Where you have not done that, and issued a letter of termination at the end of the contract, in those circumstances you'd be required to pay that notice?---Yes. No, maybe I wasn't clear. At all times, we issue a notice of termination.
PN528
Yes, okay?---At all times.
PN529
At all times a notice?---And again, depending on the - you are correct if they are over 45, it is 5 years. So we issued that letter - - -
PN530
THE COMMISSIONER: 5 weeks?---Sorry, 5 weeks. We issued that letter, and I think there's a copy in our witness statements. A copy of that letter that went - that David Smith issued. That letter is pretty straightforward, it is saying that we've lost the contract, that therefore we are encouraging, whatever. I took Bruce Christie's letter emailed to me was to say: even though you have issued notice, you should now go and terminate them. I am thinking, well why would we do that, you know, we've got a contract until the end of the month. We don't know at that stage who we have to terminate because we might have been in a position where unfortunately Skyways might not have picked up all the staff, and then we might have had to see whether or not we could find them a position somewhere else or make them redundant. So that is where I couldn't fathom Bruce's response to me and that's why I just wanted clarification on that issue.
PN531
Okay, and you agree that that letter from Bruce is in fact on 30 January and for the vast majority of employees who I think vary between - it may in fact be over 45, but it certainly would all require - the vast majority would have required the 4-weeks notice, I put that to you, and you sent the letter out in effect giving notice of termination on the 28th?---Yes.
**** JEFFREY CRAIG MORGAN XXN MS WALTERS
PN532
I can refer you to the KG1 of Mr Gadsden's witness statement, that this email was sent to you on the 30th, but in fact that is not early termination, and in fact would be an unusual reading of it to put that he is asking you to terminate after notice of termination had been sent out. In fact I put you to the reading of it is actually that to send out letters of termination, notice of termination to accord with the provisions?---You are probably right, but I wanted clarification from Bruce on that.
PN533
PN534
MR MURPHY: Mr Morgan, can you have a look at - have you got Mr Gadsden's statement there?---Yes, I do.
PN535
Could you have a look at the first exhibits to that, KG1. Is that the letter that you instructed Mr Smith to send out to all the employees?---I drafted that letter and sent it via email to David, instructed him to write them individually and hand deliver.
PN536
And as far as you were concerned, that was the sort of notice of termination of the employment of the employees with Prestige?---That's correct.
PN537
Right, and despite the email that you got from Mr Gadsden on 30 January, you didn't send out any subsequent notice of termination to any of the employees?---From Mr Christie?
PN538
Yes, sorry, from Mr Christie?---No.
PN539
No. All right. You were asked some earlier questions before lunch about the Geelong changeover and you said that down in Geelong that the employees didn't have enough service to be paid any accrued annual leave. Do you recall that evidence, because you'd only had the contract for 6 years?---They did not have any long service leave.
**** JEFFREY CRAIG MORGAN RXN MR MURPHY
PN540
Long service leave?---Entitlements.
PN541
But were they paid their accrued annual leave?---Yes, they were.
PN542
Yes, all right. Now you were asked in cross-examination just before about a woman, Diane Atkinson where it was put to you that Mr Gadsden raised the question of her being paid her accrued long service leave. Do you recall whether he ever did raise that with you about her?---Honestly, I don't know. I would think, you know, I think that Mr Gadsden is saying that. I would take that on board that he did mention it.
PN543
Yes, all right?---But, honestly, I cannot comment on that now.
PN544
Well, you recall my opening address to the Commission where I indicated that the company was prepared to pay the accrued long service leave for employees that were employed for less than 10 years that strictly were not entitled to it. Do you recall that I made that undertaking to the Commission this morning?---Yes.
PN545
And would that pick up - would that apply in relation to Diane Atkinson?---Yes.
PN546
Yes, all right. Yes, that is the re-examination of this witness. May he be excused?
PN547
PN548
MR MURPHY: Commissioner, that is all the evidence that we seek to lead in support of our application.
PN549
THE COMMISSIONER: Fine. Well, I will give you the opportunity now to give your summary of what you pressed me for earlier. Would you like to do that?
PN550
PN551
MS WALTERS: I seek to be reasonably brief at this point and that is, the position of the AWU is that this is an application to vary a certified agreement on the basis of ambiguity or uncertainty in relation to, I understand, clause 5 and 17, although I am not quite sure in terms of the two forms of variation put forward by the applicants. The AWU submits that the applicants have not applied the correct test which the Commission is required to follow when hearing an application for variation of a certified agreement.
PN552
The AWU will take the Commission to a number of authorities, some of which have been referred to in the respondent's outline of submissions at some point later. We rely on those authorities. We say in brief, the test is in the first instance that the Commission is in effect required to ascertain jurisdiction and in doing that, or in order to do that, the Commission looks at the construction of the clause said to be ambiguous or uncertain and determines whether on plain reading of that clause it is susceptible to two meanings.
PN553
The AWU concedes that the Commission will err, and there is authority to that effect, that the Commission will err on finding ambiguity or uncertainty. The AWU also submits that when looking at the plain meaning and determining whether it is susceptible to two different meanings that the Commission will look at the clause and the words of the clause in light of the parent award. The AWU submits that the test is not for the Commission to look at an objective background that maybe a TCR standard, which is referred to in the applicant's outline of submissions.
PN554
The AWU submits that neither clause 5 or clause 17 is in fact ambiguous in the light of the parent award on its plain meaning and it is not susceptible to two different meanings. The AWU refers to and seeks to rely on the decision of SDP Williams in S.J. Higgins which is referred to in the respondent's outline of submissions and that is in effect that the claim is self-serving, that in fact an agreement was negotiated and certified and that employees and the employer alike have relied on that certified agreement to govern terms and conditions of employment at a workplace and that the applicant finds itself now in a situation where it can either be that there is, and I am not sure whether it is asserting there is inconsistency between the Metal Award and Metal Industries Award 1998 and the agreement.
PN555
So in submission seeking to relieve itself of a right provided for, in that agreement at clause 17. The AWU submits that the second arm of the tests is that it is discretionary and that is the power to in fact vary a certified agreement to remove any ambiguity or uncertainty is a discretionary power. When deciding whether to exercise that discretion, the Commission looks to the mutual intentions of the parties at the time the certified agreement was negotiated. The AWU has referred to a number of authorities in its outline of submissions and the AWU relies on those authorities and will take the Commission to those authorities in more detail in its full oral submissions.
PN556
The AWU submits that it was the mutual intention of the parties at the certification of both the 1997 agreement and the 2000 agreement are quite clear and the AWU will rely on the evidence of Mr Ken Gadsden to that effect. The AWU submits that the mutual intention of those parties at the negotiation of the certified agreement is very clear in the sense that clause 17 is provided for in the agreement. It refers to the award, it then refers to the notice. It goes through a consultation process, it then refers to the notice provisions provided for in the metal industries and a like award and it then moves away from the award and says that:
PN557
Severance pay in the circumstances of redundancy after the consultation has occurred will be in the order of 2 weeks per year of service, capped at 26.
PN558
That is clear and that would have been explained - we can hope - and that was explained to employees prior to the certification of the agreement and certainly we will lead evidence that at the negotiating table that the intention of the union and indeed of the applicant was that that is exactly what that clause would provide for. The AWU also submits and will rely on the evidence of Mr Gadsden to the effect of the Incolink payments were also a part of the 2000 agreement. They were previously provided for in the 1997 agreement in a schedule.
PN559
That schedule was admitted for the 2000 agreement. However it is the submission of the AWU that it was very clear at the negotiating table that that would be included in the certified agreement and the AWU relies on the fact that the employer continued to pay Incolink. To the same effect that an in-principle agreement was made between the applicant and respondent until the tender process had been completed, that the principles of the EBA would continue to apply, the terms and conditions would continue to apply.
PN560
The AWU submits that the applicant raised in its submissions that the respondent's position in terms of this application and in terms of its continued, I guess, stance with respect to the payment of severance pay in accordance with the agreement, and I can't remember the words that were used exactly, but that it was in some way unscrupulous or unmeritorious. The AWU submits that it is the complete opposite, that in fact the AWU has gone and negotiated two agreements for its members at the Alcoa site, that it has gone to that negotiating table in good faith and in exercising its powers to negotiate an agreement on behalf of its members and that agreement - both those agreements have been certified by the Commission.
PN561
It is then the role of the union to ensure that both parties remain compliant with that agreement and that in fact it is not unmeritorious. The AWU finally reiterates that it submits and relies on SDP Williams that the application of the applicant is, as it says itself, an attempt to relieve itself of its obligations which are provided for in a certified agreement which is not ambiguous or uncertain. The AWU calls Mr Ken Gadsden.
PN562
MS WALTERS: Mr Gadsden, can I ask you to state your full name for the Commission, please?---Kenneth Alfred Gadsden.
PN563
And your professional address?---Is 685 Spencer Street, Melbourne.
PN564
Okay. And your occupation?---Union Organiser with the Australian Workers' Union.
PN565
And you prepared a witness statement for today's proceedings?---Yes, I have.
PN566
Is that statement true and correct or are there any changes that you wish to make?---I believe there's a couple of minor changes that are required. I also might add that after Mr Morgan's evidence, there may be in my mind some doubt as to whether he was at a meeting where his local manager attended with I think, Glenda Simmonds, Bruce Christie and so forth.
PN567
We note that and I will take you back to that?---Yes.
PN568
You have got a copy of your witness statement with you, Mr Gadsden?---Yes.
PN569
Can you take the Commission to those changes that you seek to make?---Yes, if you are patient?
PN570
Yes. If you deal with the minor changes first, we can then go back to - - -?---I actually haven't got them marked here and I am still looking for them. Please be patient.
PN571
THE COMMISSIONER: That is all right, there is no hurry. Do not worry, Mr Gadsden?---Yes, on 15, clause 15, it refers to Marie Allen as being the Skyways paid administrator, and clearly she works for Prestige Tempo.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN572
MS WALTERS: And on that basis would the same mistake have occurred in the paragraph above?---Yes.
PN573
At clause 14 the reference at page - - -?---"I was concerned that Skyways were not going to follow the agreement."
PN574
And that should read: Prestige?---Absolutely. Just looking for the meeting.
PN575
Mr Gadsden, would you like some assistance. You went through some of the changes you would like to make with me earlier?---Yes, I am just trying to pick up the one - - -
PN576
Yes, certainly. If I take you to 34?---Yes. Yes, it reads, "There are only two full-time cleaners under Skyways." That is incorrect, it should read: twelve.
PN577
Okay. Back to paragraph 7?---Yes.
PN578
This goes to what you have just raised with the Commission?---Yes.
PN579
THE COMMISSIONER: What does "yes" mean?---I think I have found it.
PN580
MS WALTERS: Okay and it goes on to paragraph 8?---Yes.
PN581
Where you detail - - -?---"The following people were present at the meeting.
PN582
Yes. For the purposes of clarity, can you clarify at 7, where the meeting that you are referring to, is that the same meeting on the 10th that Mr Morgan refers to in his witness statement?---No.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN583
That is a different meeting?---Yes.
PN584
Okay. So you alerted the Commission that you would like to make some changes as to who you believed to be present. Did that meeting that you say occurred at 7 in late January?---Yes.
PN585
And then follow on with people present at paragraph 8. Did that meeting occur?---Yes, it did.
PN586
Were all those people present?---Chris Brown, Bruce Christie, David Smith, yes, they were.
PN587
Yourself and Mr Tennant, John Ferguson and Glenda Simmonds?---Correct, yes.
PN588
You have stated to the Commission that there was a meeting where on hearing Mr Morgan's evidence you understand that it was in fact perhaps Mr David Smith - - -?---Correct.
PN589
- - - that was in attendance? Can you take the Commission to - - -?---I believe that is in clause 12.
PN590
Yes?---Where I say: I believe Mr Morgan responded and advised me that he would get back to me in about 10 days. I know I should have been referring to David Smith. If you read through my statement at 13 it says that really because I rang Jeff after the meeting.
PN591
Are there any further changes that you would like to make to your - - -?---No, I think that covers them.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN592
PN593
MS WALTERS: Mr Gadsden, can I take you to paragraph 7 of your witness statement? If it pleases the Commission, I have just understood myself that perhaps Mr Gadsden might be required to make a further change - no, that is all right, I've misread it. Paragraph 7, Mr Gadsden, can you explain to the Commission in a bit more detail the conversation that went on between the parties at that meeting? Paragraph 7 in late January?---Sure. At that point in time, all the guys had received letters from Prestige, saying that their employment would be terminated as of 29 February. There was a fair bit of concern from the guys to ensure that all their entitlements were paid out, which included long service, annual leave and so forth and so on. So a meeting was convened with the new contractor which included - I'd better make sure I get it right. Chris Brown and Bruce Christie representing Skyways and from the outgoing contractor, David Smith, the local manager, along with a couple of representatives from the Alcoa site itself. The idea was to find out and be certain in our minds whether it would be a transmission of business or whether it would be a termination of people's employment and they would have to throw their hat in the ring and apply for jobs, or how it would actually work. So the meeting proceeded to explore those possibilities and Mr Christie, who, as I understand it, is actually Chris Brown's boss, when asked a question, he made it very clear to me there would be no transmission of business and that as far as he was concerned, the employees would have to win their job on their merit and that they would be making it open and available to everyone.
PN594
Can you explain to the Commission, Mr Gadsden, why it was important for that question to be put to the parties at the table as to transmission of business?---Yes, clearly because we have a clause in the EBA relating to redundancies being 2 weeks for every year worked up to a maximum of 26 weeks and if it wasn't a transmission of business, we clearly understood, in my mind and our members, that that clause would cover redundancies if people weren't guaranteed transmission of business and entitlements, so we needed to know that, so to know which step we would take further from there.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN595
Mr Gadsden, you went away from that meeting understanding that, and I would ask you to explain to the Commission what, in fact, you understood at the end of that meeting and what you were then going to take back to your members?---At the end of that meeting, it was very clear that everyone would be terminated. Myself and Barry made it very clear to each other that we had to get back to the membership and explain that the continuity of employment was about to cease and that we would have to pursue under the enterprise agreement their redundancy clause.
PN596
Okay. Now, can I take you now to the heading: Enterprise Agreements and in the first instance, paragraph 21?---Yes.
PN597
Can you explain to the Commission who else was at the negotiating table for the '97 agreement?---Yes, at that point in time, Mr Gary Mallen was the local manager of the Property Services. Prestige at that point in time made a compassionate plea to myself and my members that they were doing things pretty tough. They were very concerned about having an increase in their base of any significance because it has an impact across obviously long service and annual leave and the whole gambit. So they put a proposition to us about finding a way for the guys to get an increase that wouldn't have an impact in the all-purpose rate and from that, it was decided that the guys, instead of picking up a significant pay increase, would accept a half Incolink payment at the time, which was $25, and further to that an extra $5 a week to go into superannuation. And the basis of the agreement was - that was what formed the basis of the agreement, which I've got to say was one of the - a pretty amicable type agreement it was. Certainly there wasn't any industrial action required to get an outcome.
PN598
Can you explain to the Commission why in the '97 agreement which I think is exhibit P2, why there was - - -
PN599
THE COMMISSIONER: I don't think I gave it a - - -
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN600
MS WALTERS: You exhibited the '97 agreement?
PN601
THE COMMISSIONER: I didn't mark it.
PN602
MS WALTERS: Okay, I apologise, Commissioner. Can you explain to the Commission, why in fact there is no redundancy clause in that agreement?---Well, in effect there is because it makes reference to the Metal Industry 1998 and the metal industry covers it for the standard redundancy clause. It is not written in there but it makes reference to the Metal Industry 1998 thus, yes.
PN603
So where you say at 26 the agreement included the same redundancy provisions as the 2000 agreement, in fact, can you explain to the Commission in light of that what you mean by paragraph 26?---I certainly could have chosen my words better, I can say that. However, what it was was in my mind that I was reflecting that both agreements actually covered redundancy, albeit one significantly higher than the other.
PN604
By referring to it being significantly higher than the other, you are referring to the provisions for redundancy in the metal industries and akin award which is at 8 weeks, is that correct?---Correct, yes.
PN605
Can you take the Commission now to the - actually, can I ask, to the best of your knowledge in terms of the '97 agreement, was that explained in accordance with the Act in terms of, it was taken to the employees, the agreement was gone through?---There would have been several mass meetings to work through the document as it was being developed and when the final draft was ready to go, there certainly would have been a mass meeting to have a vote on it and make sure everyone understood it.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN606
Can you take the Commission to the 2000 agreement now? Can you explain the negotiating table in effect to the Commission at the 2000 agreement? Who was present?---Yes. Again, to the best of my knowledge, Gary Mallen was certainly there, and I always get his name wrong, but is it, Neil Barwise? I've got it right. Neil, certainly would have been there at the first meeting in my recollection but as the meetings continued on to develop that agreement, Neil actually dropped off the negotiating team and left it to Gary. But I've got to say, it was a pretty straightforward bargaining agreement because it was reflective of the campaign 2000, metal industry campaign.
PN607
Were there any discussions in terms of the 2000 agreement as to the Metal Industry Award being the parent award?---Certainly were. That was clear right through. The cleaning staff on the smelter side, even before enterprise agreements came into place, effectively took their provisions from the Metal Industry Award, even going back to 1990. So right along through these people have been well aware that the metal industry has been the parent award.
PN608
Can you explain to the Commission whether or not you were aware of it being common practice for the Building Services Award to generally be a parent award where you have got - - -?---Yes, I do, yes, it is very unusual. No, not very unusual, it's unusual though for people not to be respondent to that that do cleaning. However on industrial sites, and there is several around the State, where the cleaning is done by the - well, the largest union that is representative on that site and in that case, we have a number of cleaning sites that are respondent to the metal industry.
[3.15pm]
PN609
Can you explain the details of the negotiations for the 2000 agreement? You said they were relatively uncontentious. Can you explain the details of that negotiation process?---Yes, your typical negotiations, we started off from one position and Prestige started at another but one thing that was put on the table very early was around about the redundancy. Taking on board that the guys three years prior - it had been very restrained on wages and actually contributed to their own redundancy. So what we did then - it was reached agreement around that because of - they took a $25 pay into Incolink that they may not have been doing as well out of redundancies as a lot of other people on the site and to reflect on that that is where we got the redundancy clause up.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN610
Okay so it was at the 2000 negotiating table that the clause 17 of the agreement - - -?---Came into being.
PN611
Okay. And can you explain to the Commission any other terms and conditions that the union took to those negotiations?---Well, effectively that negotiations - it was essentially the Metal Industry Award campaign so the guys got 5 per cent pay increases each year over the three years of the agreement and that was pretty much it, really.
PN612
Can you explain to the commission - and you refer to it in paragraph - - -?---Well, if you are referring - - -
PN613
Paragraph 33?---Sorry. Yes, yes, that is correct, certainly there was no dispute that there would be a dual type arrangement where Incolink payment was made and on top there would be the two weeks for every year up to a maximum of 26 weeks in the redundancy. And it was made apparent very clearly to Mr Mallen that that would be the case; he understood that and there was no contention about it whatsoever.
PN614
And you took that back to your membership?---The same process that we always use, yes, there was a number of - a series of mass meetings finishing up with a final draft where all the people involved got to vote on it and make the decision. I just have got to add to that - I hope I am not out of order, I am sure I will get yelled at if I am. All be this may be a very unusual clause to a lot of people that don't work on Portland Aluminium site the dual Incolink and redundancy there is common throughout every agreement on that site for the contractors.
PN615
You have read the witness statement of Mr Morgan?---Yes.
PN616
And in his witness statement - do you have a copy of Mr Morgan's witness statement with you?---I am not sure, hopefully I do. I am beginning to think the answer to that question is going to be no.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN617
Thank you, Commissioner?---Thank you, I don't have one.
PN618
Can I take you to paragraph 13?---Yes.
PN619
Yes?---Yes, yes, found it, yes.
PN620
And can I take you to paragraph 16 of your own statement?---Yes.
PN621
And also to paragraph 11 of Mr Morgan's statement which goes to the question of redundancy or severance pay?---Sure.
PN622
Can I ask you to explain to the Commission the union's perspective on Prestige's position which is outlined in Mr Morgan's witness statement at 13 - the union's response. And can I also ask you to explain to the Commission, in your experience of 14 years at the Alcoa site - you have been an organiser at Alcoa for 14 years?---I better make that very clear, I have been a paid organiser since '95 but prior to that I was the site convenor from 1990.
PN623
Okay?---But, yes, I an.
PN624
In the first instance, can I ask you to explain the union's response to paragraph 13 which has been Mr Morgan of Prestige's position with respect to the redundancies and can I ask you to explain that clearly to the Commission?---Well, clearly we believe that is in breach of the enterprise agreement. We believe that the guys are entitled to the redundancy. I would also say that clearly not everyone was found full time employment that were full time employed prior to the change of contract company. And clearly our expectations were that once you have an agreement signed in the Commission and ratified that the clauses in that are watertight.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN625
Okay and can I, secondly, ask you to explain to the Commission, in your experience, what you understand a transmission of business to be and give any example of where it has occurred previously at the Portland Alcoa site?---Yes, well, we had one of our major contractors - was John Beever Pty Ltd Australia sold his business to another contractor which was ECL Cranes. At that point in time that was a genuine transmission of business because everybody that went from John Beever to ECL, all their entitlements were maintained, every paragraph and every part of their entitlements, like, redundancy, long service, annual leave, all the rest and a total commitment in writing to the employees was given that their current EBA would be maintained and followed and all the rest of it. Whereas we have another contractor, Kempie International, at that time they were called, they shared the mechanical contract on site with Keppel Prince and it was given to one contractor and the other lost out. And about 35 of the people from Kempie were picked up by Prince, had all their entitlements paid out by Kempie International and also paid a redundancy before they started employment with Prince and that was - they finished the Friday and started the Monday.
PN626
Okay. Can I ask during the period post your being informed that Prestige had lost the contract - and in fact are you aware of anyone that has been made redundant and been paid the severance pay in accordance with clause 17 of the certified agreement?---This is out of the transaction just recently between the two contractors changing hands?
PN627
That is correct?---Yes, Mr Tim Young certainly was paid his full redundancy under provision 17 of the current EBA.
PN628
And Mr Young wasn't successful in gaining employment at Skyways?---No.
PN629
Was Mr Young interviewed by Skyways?---Yes, he did have an interview.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN630
And did the company come to you at that time and raise any concerns with respect to clause 17 as to how they would apply the provisions of clause 17?---No, but I had rang Jeff and I had spoken to Jeff at that meeting in Melbourne as well and I rang Jeff and said, you know, what about Tim at this point in time. You know, it is clear, we may be debating about the other issues about who should get paid redundancies, but clearly, Tim has not picked up employment, don't you think it is just that he is at least paid while we go through the process we are going through today to resolve the other issues and he said that is only fair and reasonable and Tim was paid his redundancy under the provision 17 without me having to explain it to anybody.
PN631
Okay. And did - you have referred to a conversation with Mr Morgan. Can you explain to the Commission the reasoning Mr Morgan had behind paying that redundancy and severance pay in accordance with clause 12?
PN632
MR MURPHY: Well, I object to this, none of this was put to Mr Morgan in any event and what this witness thinks of Mr Morgan's reasoning is really neither here nor there.
PN633
MS WALTERS: Commissioner, I apologise - - -
PN634
THE COMMISSIONER: Go on, you can respond.
PN635
MS WALTERS: Commissioner, I understand that the redundancy in terms of Mr Tim Young was in fact put to Mr Morgan previously in his witness evidence.
PN636
THE COMMISSIONER: My recollection was he was only mentioned in response to the question that was asked. It was simply with the list of names, did he get redundancy. It was the only it was put in my recollection. Do you have a different recollection?
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN637
MS WALTERS: No, Commissioner.
PN638
THE COMMISSIONER: Well - - -
PN639
MS WALTERS: Yes, I will move on.
PN640
Mr Gadsden, I take you to paragraph 1 of your witness statement where you have explained to the Commission that you are an elected organiser and you have been - worked in the Portland region for around - since 1995 and can I also take you to paragraph 34 of your witness statement?---Yes.
PN641
And can I ask you to explain to the Commission what you mean by the - paragraph 34, the final three sentences:
PN642
Skyways have reduced the number of hours of work for cleaners. This means they earn less - - -
PN643
?---Yes. The hourly rate stayed exactly the same at 21.05, there has been no question about that. However, there was a roster in place that people were doing 38 hours a week and that was a roster - not an overtime roster, it was a roster of 38 hours in it recognising that the base time was 36 and the two hours were to be treated as, what we used to call, the 21st shift because, essentially, they were shift workers, they got paid double time for those two hours and now Skyways are coming back wanting to reduce the guys further again by reducing their weekend work. So if you take into account those two hours of double time plus the weekend reduction the guys will actually be earning $80 gross a week less than what they were under the terms and conditions with Prestige. And in effect where they were working 14 days out of 28, under a proposal Skyways have put to us at the moment, they will now have to work 16 out of 28. So there is some significant differences in their employment. On top of that they certainly - we have Bev Ingliss who was working permanent part time with Skyways has now been reduced to casual.
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN644
MR MURPHY: Well, this evidence wasn't put to Mr Brown. He was here - he was here - all this alleged material - there was some discussion about a change but Bev Ingliss was never mentioned to Mr Brown. Mr Brown gave evidence that there was a discussion about a change to a 36 roster and a proposed future change about the number of days on the roster different from the current arrangement. He said it is the subject of consultation further down the track and that was all the cross-examination of Mr Brown. And yet, now, after Mr Brown is on the plane back to Portland, all this matter is being put to this witness. It is most unfair and wrong.
PN645
MS WALTERS: Commissioner, I understand that on cross-examination Mr Brown went into detail as to his belief as to the current - the terms and conditions of Skyways' employees as of 1 March and referred in his evidence to the terms and conditions of employment prior to 1 March and proffered his opinion as to the difference in those terms and conditions and his opinion, in his evidence, being very clear, that he didn't believe there to be any change in those terms and conditions.
PN646
THE COMMISSIONER: Other than the 36 hour week.
PN647
MS WALTERS: Other than 36 hours. He also went into detailed evidence as to the rosters and to the minor changes. He also went into in his explanation as to his belief that there was no difference in the terms and conditions. He went through a number of categories, Commissioner.
PN648
THE COMMISSIONER: I agree with that. I am interested in Mr Gadsden, in any event, explaining what he means in 34?---So I will continue, is that - - -
**** KENNETH ALFRED GADSDEN XN MS WALTERS
PN649
Yes, where you say there that there are only 12 full time cleaners and then you go over to say that - and you say the rest are casuals. Do I interpret from that that you are saying that people who were previously full time are now casual?---Yes, but to the point where we are only talking about - well, Mr Tim Young is no longer with the company and I concur with what Mr Morgan said earlier, he had been off ill for about six months prior to the change. Bev Ingliss was permanent part time and Graham Pitt was full time and Graham Pitt and Bev Ingliss are both now casuals and were in the past either permanent part time or permanent totally.
PN650
Yes, go on.
PN651
MS WALTERS: Mr Gadsden, at paragraph 7 you exhibit a letter sent to Josie Lowther?---Correct.
PN652
Can I ask - can I take you to, in your witness statement, paragraph eight, nine and 10 again where you detail the meeting you had with the people outlined in eight?---Yes.
PN653
Can I ask you if you took the effect of what - if you took to your membership and explained to them what you understood the outcome of that meeting to be?---That is correct, we certainly had a meeting to talk about what had been put on the table and to explain what it could mean in terms of continuity of employment, whether you should be entitled to redundancies and those sort of things, yes, we had a full meeting about the whole lot.
PN654
And can I ask you to explain to the Commission the response of your membership?---Well, there was absolute turmoil within the camp. A lot of these guys had worked there for 10 and 14 years and security is, you know, a very big thing in today's world and the guys were very concerned what it might mean given that Mr Christie had made it very clear that everyone had to re-apply for their jobs. Now, as it transpired that worked out all right, but, certainly, there was a lot of angst and concern amongst the group of people
**** KENNETH ALFRED GADSDEN XN MS WALTERS
because you have got a number of people who are either mid to late 50s or even early 60s. And quite frankly, I don't know how well people know Portland, but there is not a heck of a lot of jobs out there for people of that age group. So they had a major concern albeit for only a reasonably short period of time but certainly, yes, there was a lot of angst amongst the guys.
PN655
That is all, Mr Gadsden, thank you, Commissioner.
PN656
THE COMMISSIONER: Mr Murphy?
PN657
PN658
MR MURPHY: Mr Gadsden, you have been a union organiser for - since 1995 full time and before that for five years. So you know the provisions of the Metal Trades Award like the back of your hand, don't you?---That is a fair call.
PN659
And the provision - so the 1996 Metals Trades Award has been in - the forms of it - the year changes, but, essentially, it has been in relatively common form for years and years, hasn't it?---Correct.
PN660
And you know there is a redundancy provision been in that award since the TCR case in the 70s - well, 1984?---Yes.
PN661
And that provides, basically, the community standard of up to a maximum of eight weeks?---It certainly has done, yes.
PN662
Yes and of course in the mid 1990s various campaigns sought to improve on that community standard in terms of the number of weeks per year of service?---Sure.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN663
And that was part of the - I withdraw that. At the same time there was, during the 1990s, the unions also sought an issue or portability of redundancy benefit and developed the Incolink scheme for that?---Yes, Fund Number One, that is right.
PN664
Yes and that came out of the building industry because people would be going from job to job?---Construction - - -
PN665
Construction industry?---Yes, correct.
PN666
And so you were able to get in the 1997 agreement that the - Prestige would pay $25 a week into the Incolink Fund for redundancies?---That is right in lieu of a pay rise, that is right.
PN667
In lieu - well, I suggest to you that was just an additional benefit that you sought in the 1997 negotiations?---Well, be that as it may - - -
PN668
That was the case, wasn't it?---No, it was not.
PN669
I suggest it was?---The case was that Prestige had put to us that they were struggling and they didn't want to see a base increase of any significant outcome so we agreed on $25 going into Incolink.
PN670
Yes, but the point is that the actual wage rise that you got in the negotiations at Portland were really - if you couldn't get a wage rise throughout the site that you forced Prestige to pay whatever wage rise that had been obtained by you for other contractors on the site?---That is not accurate.
PN671
I suggest that was the case?---Well, I am suggesting it is not.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN672
All right, now, you agree that in 1997, in the 1997 agreement, that recites that the parties are bound by the metal trades agreement?---Sure.
PN673
So that was common ground in 1997, wasn't it?---Yes.
PN674
That even though in truth Prestige was not a respondent to the award, you knew that didn't you?---Both parties knew that - - -
PN675
Yes?--- - - - but we acknowledged we would use it for the no disadvantage case to put it underneath as - yes.
PN676
Yes, so you are happy to swear statutory declarations, both parties, saying that, yes, we are bound by the Metal Trades Award, both of us, even though you weren't' in respect of the Prestige employees; correct?---Correct.
PN677
And then to say, well, we have conducted - we have made a further agreement on top of that under the agreement making provisions of the Act and we want this certified by the Commission and the employees are not disadvantaged?---Correct.
PN678
And it contained, in the case of the 1997 agreement, this provision - it is quite a short agreement, the 1997 agreement - - -?---It certainly is.
PN679
- - - but it does contain the provisions in relation to Incolink in the appendix?---Yes.
PN680
But as far as you were concerned the question of redundancy really wasn't an issue at that time?---No, well- - -
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN681
The actual quantum of redundancy payments?---No, because as far as we were concerned the metal industry underpinned it - - -
PN682
Yes?--- - - - so the clause from there covered it as well.
PN683
That is right, the metal industry underpinned it so the redundancy would be eight weeks or whatever the provision - - -?---Sure.
PN684
- - - in the metal industry?---Yes.
PN685
So then - we move then to 2000 - to the 2000 negotiations and at that point the actual certified agreement is more comprehensive than the 1997 agreement?---Yes, certainly is.
PN686
And it actually adopts part of the metal industry's provision in relation to redundancy, doesn't it, the consultation provision go into the award - go into the agreement?---Agreement, yes.
PN687
And the - but the thing that the union was on in campaign 2000 was in fact to get a two weeks per year of service provision of general application, wasn't it?---Among others.
PN688
Among others but that was the main thing you were, sort of, seeking from Prestige, wasn't it?---Are you talking about above Incolink or are you just talking about Incolink?
PN689
Well, just - no, forget Incolink. Incolink was a given. You had the payment of $25 a week, that was to remain the same?---Yes.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN690
But you wanted to increase from a maximum of eight weeks - - -?---Yes.
PN691
- - - per year of service or eight weeks - - -?---Maximum.
PN692
- - - for more than eight years service up to two weeks per year of service with a cap of 26 weeks?---Correct.
PN693
And that is what the metal industry unions were seeking across the whole of Victoria and part of campaign 2000, effectively?---In variations of that, but, yes, there was an effort to increase it.
PN694
Yes, to increase the number of weeks per year of service?---Yes, yes.
PN695
But it was always in terms of building on - building that increase two weeks per year of service on the existing structure of the metal trades severance redundancy provisions - the Metal Trades Award redundancy provisions, wasn't it?---It certainly was reflective of that is where it come from, yes.
PN696
Yes, well, you just wanted more, you wanted instead of eight weeks you wanted two weeks per year of service, didn't you?---We certainly wanted to increase the benefit, that is right.
PN697
Right, increase the benefit, yes, okay. So that you have known - you said that you had known the Metal Trades Award like the back of your hand - is that you know that that - the redundancy provisions in the Metal Trades Award, and redundancy provisions in general, they don't give an absolute right to redundancy, do they?---No, there are extenuating circumstances.
PN698
There are a number of exemptions - - -?---Yes.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN699
- - - available?---Absolutely.
PN700
Including if the employer employs - makes less than 15 employees retrenched and if the employer employs less than 15 people - - -?---Yes.
PN701
- - - they don't even apply at all until recently?---Yes.
PN702
That - and there is a general provision to allow the employer to make an application when alternative employment has been obtained for relief from the redundancy provision, isn't there?---In sorts, yes.
PN703
Do you want me to show - do you want me to read it - - -?---No, I don't need you to show it.
PN704
You are aware of it, aren't you?---Yes, yes, I am, yes.
PN705
And there is also provision - and the general understanding in the industry is that if in the event that there is in fact transmission of employment then redundancy doesn't apply, that people - transition of business, they are not redundant?---If it is a transmission of business, yes.
PN706
Yes, that is the general understanding of that - that is your understanding?---A true transmission of business, I agree.
PN707
Yes, right, okay. Now, I suggest to you that - I withdraw that. You made - you have in fact negotiated with everyone down at the Alcoa site a new certified agreement, haven't you, at Portland but it hasn't been certified yet?---Correct.
PN708
And are you familiar with that agreement?---Are you talking about with Prestige, are we?
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN709
No, no, well, it had been negotiated but it hadn't - it hasn't come into effect - been ratified by the Commission yet?---Yes, yes.
PN710
It was negotiated with Prestige and Mr Morgan, you heard him say, that he was abiding by the pay rise provisions of the Incolink payments; correct?---All the above, yes.
PN711
Yes?---Yes.
[3.45pm]
PN712
Now, you are aware that there is, in fact, a change in the provisions in that agreement as it relates to redundancy?---Explain what you are referring to?
PN713
Well, let us get this straight, Mr Morgan. Is it your case that had their been - sorry, Mr Gadsden - is it your case that had these employees been the subject - had Skyways taken them over by way of a transmission of business, look the Commissioner in the eye and tell him whether or not you say they would be entitled to redundancy?---If it was a true transmission of business I wouldn't be in here.
PN714
Show me the provision in the award or in the certified agreement that says that redundancy is not to be paid in those circumstances?---I can't.
PN715
Right. But that was certainly your intention, wasn't it, that the employees in those circumstances - or that the employer, namely, Prestige, could come to this Commission and get exemption from redundancy, where there is - - -?---Under a transmission of business, yes, absolutely.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN716
Yes, right. Now, Mr Gadsden, that is what Prestige are doing here now. They are coming here to make an application under that certified agreement to get exemption from payment, because these 12 employees were full time with Prestige, and you know they are full time with Skyways, don't you?---I don't believe that these people were guaranteed a job. There was no guarantee. They had to apply for a job on its own merits, and go through interview process, and as it comes - - -
PN717
But they got the job, didn't they?---Good and well, they did, yes.
PN718
And not one of them is coming here to give evidence to say they don't like the job, are they?---No.
PN719
And Mr Brown has said none of them have been sacked?---As I have already pointed out, there are a number of people there under less pay and less conditions than they were employed for when they were with Prestige.
PN720
Well, I suggest to you that none of them have come up here and have said - are prepared to say, or support you in your evidence, your union, that the job is less satisfactory than it was, are they?---They are not here, but that is not the case.
PN721
No, and you haven't filed a witness statement for them either?---That is correct.
PN722
And the fact is you heard Mr Brown give evidence that in effect this was a seamless Friday to Monday arrangement, as far as Skyways were concerned?---In terms of the same site and doing the same work, one hundred per cent agree with you.
PN723
And the same people?---The vast majority are the same people.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN724
And so in fact the only thing that has happened to these people is a period from about 29 January to when they were advised that they would in fact be re-employed, they had that period when there was uncertainty: do you agree with that?---That is right.
PN725
And as far as all the ones that had over 10 years service, they have been paid their long service leave, haven't they?---Correct.
PN726
And you have heard the undertaking that I gave in the opening that Prestige are prepared to pay the long service leave for those who have got less than 10 years service?---I certainly heard that.
PN727
And yet you are saying that Prestige should not even be able to make an application to this Commission to seek some relief from the payment of redundancy?---Under the terms that it took place, that is correct.
PN728
I suggest - I put to you, Mr Gadsden, that when you look at the certified agreement it says in clause 5 that the terms of the Metal Industry Award are to apply here. Now, you understand that the Metal Industry Award redundancy provisions allow an employer to make application for relief?---I do understand that.
PN729
Now, I suggest to you it was never the intention of the parties negotiating the 2000 certified agreement to withdraw that right, was it?---No.
PN730
So you would agree then that Prestige should have the right to ask the Commission for exemption?---Under the right terms, yes.
PN731
So you accept - you accept, do you not, that the certified agreement contains dispute resolution provisions in it?---It sure does.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN732
You accept that the certified agreement and the award allow for a party to make an application for exemption or relief from the general severance provision?---I understand under any agreement the disputes procedure, whether it is this issue or any other one, neither the union nor the employer can be estopped of their rights to make application to the Commission.
PN733
Right?---And I am not trying, and never have said that you don't have that right.
PN734
So you were happy to fight us on a fair battlefield that we - that Prestige has provided alternative employment, or that Skyways are providing alternative employment for these 12 employees?---Yes.
PN735
Yet you still say that Prestige should pay 2 weeks per year of service redundancy for these people: is that what you are saying?---That is what I am saying.
PN736
Now, you understand that that is contrary to the provisions of the Metal Industry Award which says that in circumstances where an employer has made alternative employment - has obtained alternative employment, they can make an application to the Commission?---I don't believe Prestige have any influence at all about Skyways picking up the people.
PN737
That is the merits of the question. The question I am asking you is, and I will just rephrase it so you get it. The Metal Industry Award allows an employer in circumstances where alternative employment has been obtained to make an application for relief from redundancy. I put to you that there is not a single word in the 2000 certified agreement to say that that right is excluded under the 2000 certified agreement?---I agree with that.
PN738
So you then are prepared to concede that the Prestige should have the right under the certified agreement to make that application to the Commission?---Well, we are here.
**** KENNETH ALFRED GADSDEN XXN MR MURPHY
PN739
No, we are not here, because your submission, your opening submissions by my learned friend is that there is no right for us to make that application because we must be bound by clause 17.1.4 which says, in the event there is redundancy you pay the two weeks per year of service absolutely. Are you resiling from that now?---No.
PN740
Right. So you are saying that the Prestige agreed in the 2000 agreement with you, with the union, to exclude all the provisions of the Metal Industry Award relating to severance totally?---No, you have misunderstood my "no".
PN741
Which no?---The one I just said at the beginning of that.
PN742
So you are not resiling - you are resiling then - - -?---What I am saying is that because it is underpinned by the Metal Industry Award, as you are indicating, you have the right to challenge it.
PN743
All right. Thank you. Well, is that the case - is it the case then, if you accept that - Commissioner, at this point the witness should be asked to resume his seat in order for me to address the Commission on the present state of this application.
PN744
PN745
THE COMMISSIONER: There is a question that deeply concerns me, and it seems to me from the evidence that both parties have knowingly tendered false statutory declarations, or may have.
PN746
MR MURPHY: That is troubling. Well, it is an estoppel point, in a sense, and in a sense it has been now conceded by the witness that what I have got him to accept is that the union as an applicant should not be able to resile - sorry, the union as a respondent should not be able to resile from the mechanisms of the Metal Industry Award, and for the purposes of this application. And as I indicated in my opening, that we say that in a sense what we have got here is a certified agreement that consists of the 2000 agreement and the award that is not binding, legally binding.
PN747
THE COMMISSIONER: But it was certified on the basis of false statutory declarations, and no designated award was decided by this Commission.
PN748
MR MURPHY: That is true. That is true. In a sense that is probably a pragmatic action by the parties to - - -
PN749
THE COMMISSIONER: But the Act says there has to be a designated award, in the absence of an award binding the parties.
PN750
MR MURPHY: Yes. So if you haven't designated that award, you could still certify an agreement without designating an award, or you could designate it as the award even though the parties have recited that it was binding on them. And that is troubling, and that is why the resistance, as I have attempted to put to Mr Gadsden, the resistance to the application is really unmeritorious.
PN751
If necessary, Commissioner, I might need to amend our application to make it an application under section 170LW, you see, because we have got a certified agreement here, it has got procedures in it for resolution, dispute resolution, that allow the matter to be remitted - to be taken to the Commission. We have got redundancy, an issue about whether or not there is a suitable alternative employment, or whether there is a transmission of business, and that is the dispute that we really need to be agitating. And that is a; dispute that we are entitled, in my submission, under the certified agreement and under section 170LW to bring to the Commission for resolution.
PN752
In that sense we don't need to go down the 170MD route, which talks about ambiguity or uncertainty of a certified agreement. It is really within the certified agreement. We are not seeking - this will be in a sense the third application. The first application was to vary the award. The second application was that there is an uncertainty, or under section 170MD.
PN753
Now that there is in a sense a concession that the union is prepared to abide by the award as if it were an award, then we say, well, the award and certified agreement read together allow the Commission to allow an application by a party, Prestige, to seek relief from the severance obligations, in the event that we have obtained alternative employment, or an absolute right under one of the provisions to just seek exemption from the redundancies, and that is what we are seeking.
PN754
So the sort of order we will be seeking can be couched under one or other of the terms. The application, whether it has got to be made under section 170LW, or under 170MD, at the end of the day that is only a matter of form, not substance. And the substantive award that in a sense we are seeking is the one that we put in our - that was made in one of those Bank cases effectively to the effect that a provision in the certified agreement to say that, look, the employees that were employed as at 29 February by Prestige, there is no entitlement to severance payment under the certified agreement, because they have all got jobs with Skyways.
PN755
That particular clause that we have put in our outline of submissions is - will end - will quell or quash the dispute between the parties, because we say they have got alternative employment. Either there has been a transmission of business, or a succession, or in the circumstances of the certified agreement and this particular redundancy, there should be no entitlement to severance pay under the certified agreement, or under the Metal Industry Award, in the spirit of the TCR provisions.
PN756
It was never intended that where there is a transmission or a succession or alternative employment obtained, that there should be a payment of redundancy. We are seeking to agitate that. And the witness fairly has conceded that he doesn't want to put any procedural barriers to us having that agitated. And that is why I asked if he be stood down so that we can get the position of the union very clear in relation to that. And we say when it is very clear, and we have a battle that is not sought to be prevented by reason of an argument that there is no ambiguity or uncertainty, on the merits, on the true merits, we want it agitated, and we say that we shouldn't be required to pay any redundancies to these dozen, or 15 employees.
PN757
THE COMMISSIONER: Ms Walters, do you want to be heard on these points?
PN758
MS WALTERS: Yes, I do, Commissioner. Can I start from the beginning with respect to the certification of effectively both the 1997 and 2000 certified agreement with respect to the statutory declarations, and the issue there.
PN759
Can I point out that the union has been quite open, and has conceded that in fact the Metal Industry Award, and it has gone to the negotiating table seeking, in fact seeking that - we haven't conceded that, but that was chosen as the award for the no disadvantage test, and that may in fact be explained by the respondency to the Building Industries Award. But that both parties certified an agreement on the basis that that award would underpin the certified agreement for purposes of the no disadvantage test.
PN760
Can I point out that this is becoming quite confusing to the union, because there have been a number of applications before the Commission with respect to the payment of the severance payments. Can I say that the AWU has referred to, on the basis of those inconsistencies at paragraph 15 of the outline of submissions, the decision of Glen Cameron, which was a matter before SDP Lacy, which refers to - deals with a matter of application in terms of inconsistency between the award and the certified agreement.
PN761
I think it is - Commissioner, on the basis of the submissions that have just been put to you, I think in terms of section 110, it seems to me some - and I understand, and I - the applicant has used the terms, what is at the guts of this matter, which is the severance payments - I apologise, the terms at the heart of the matter - I apologise, is that correct? At the heart of the matter, is the severance payments. And it is also referred to that seeking to obtain a level playing field to deal with that matter. And has suggested, and referred the Commission to section 170LW, which is a dispute over the application of the certified agreement.
PN762
It was open to the applicant to make such an application at any point in time.
PN763
THE COMMISSIONER: Does that include now?
PN764
MS WALTERS: I would have to get instructions on that, Commissioner. What it appears is happening now is that we have an application before the Commission based on uncertainty and ambiguity of the certified agreement. We have the question of the award that underpins both those agreements. And we have the applicant which is seeking to relieve itself of the severance payments, and has sought a section 113 application in accordance with the Metal Industry Award, the relief that is available to the applicant under that award, to not be required to pay severance payments where there are the two circumstances of acceptable alternative employment or transmission of business.
PN765
Indeed, in section 1709MD(6) application, it has referred to those provisions of the award which create the ambiguity and uncertainty in terms of the reading of clause 17. The AWU in terms of - and it is reflected in the outline of submissions, has said that, and continues to say that the test in terms of section 170MD(6) are in terms of the first of the test says that any clause in the agreement when determining whether it is ambiguous or uncertain, the Commission is to look in fact to the parent award.
PN766
So we say that on any - on the application that clause 17 and 5 are uncertain, that the applicant is not disadvantaged, because it is in fact the Commission looks, and in a number of authorities looks to the parent award to see if that in fact gives two susceptible meanings to the clause in question.
PN767
MR MURPHY: I don't want to interrupt my learned friend, but the point why I stood this matter down is that it was a concession in the sense by the witness that he - that in a sense it would have to be binding on - that in a sense he doesn't - the union doesn't take the point that there is ambiguity or uncertainty about the certified agreement, because he accepts that the Prestige, the applicant, ought to be entitled to agitate its rights under the award. He has accepted that. And in a sense my learned friend is still arguing that point now, when he has made the concession.
PN768
That is why we need to just step back and say, well, what is - how do we get to have this matter determined on the merits, now that we are over this - that the ambiguity and uncertainty defence in a sense has now dissolved under cross-examination. My learned friend still seems to be arguing that now.
PN769
MS WALTERS: Commissioner, and apologies, I am not quite sure how to phrase this, but the AWU submits that in fact it is not clear whether that concession in fact, whether it was made at all. My reading of the evidence - - -
PN770
THE COMMISSIONER: I thought that you just did in your submission before, when you said they could at any time.
PN771
MS WALTERS: Sorry?
PN772
THE COMMISSIONER: I thought you conceded that they could make an application at any time.
PN773
MS WALTERS: There is an application certified before the Commission, and that is open to a section 170LW application - - -
PN774
THE COMMISSIONER: No, no, the application to be excluded from making the payment. That is what Mr Murphy put to you, and to Mr Gadsden.
PN775
MS WALTERS: On the basis of the award underpinning the certified agreement.
PN776
THE COMMISSIONER: He hasn't made that application, but that is why we are debating it.
PN777
MS WALTERS: Yes, Commissioner.
PN778
THE COMMISSIONER: It is another point, do you understand?
PN779
MS WALTERS: Yes, Commissioner, I understand. And I understand the heart of the applicant's argument goes to the application of the award provisions as to TCR transmission of business and acceptable alternative employment.
PN780
The Commission has put to me a question as to the section 170LW. Can I ask the Commission to give me a few moments to get some instructions?
PN781
THE COMMISSIONER: Certainly. I was going to suggest that we have an adjournment, actually, not only so you could do that, but so the parties could have a discussion about it. We might get some efficiencies, I think. We will adjourn until 4.30.
NO FURTHER PROCEEDINGS RECORDED
INDEX
LIST OF WITNESSES, EXHIBITS AND MFIs |
EXHIBIT #P1 OUTLINE OF APPLICANT'S SUBMISSIONS PN86
JEFFREY CRAIG MORGAN, SWORN PN111
EXAMINATION-IN-CHIEF BY MR MURPHY PN111
EXHIBIT #P2 STATEMENT OF JEFFREY CRAIG MORGAN WITH ATTACHMENTS PN122
CROSS-EXAMINATION BY MS WALTERS PN194
WITNESS WITHDREW PN247
DAVID SMITH, AFFIRMED PN248
EXAMINATION-IN-CHIEF BY MR MURPHY PN248
EXHIBIT #P3 WITNESS STATEMENT OF DAVID SMITH PN282
CROSS-EXAMINATION BY MS WALTERS PN294
RE-EXAMINATION BY MR MURPHY PN336
WITNESS WITHDREW PN347
CHRISTOPHER ANDREW BROWN, SWORN PN360
EXAMINATION-IN-CHIEF BY MR MURPHY PN360
EXHIBIT #P4 WITNESS STATEMENT OF CHRISTOPHER ANDREW BROWN PN369
CROSS-EXAMINATION BY MS WALTERS PN400
RE-EXAMINATION BY MR MURPHY PN467
WITNESS WITHDREW PN475
JEFFREY CRAIG MORGAN, ON FORMER OATH PN480
CROSS-EXAMINATION BY MS WALTERS PN480
RE-EXAMINATION BY MR MURPHY PN534
WITNESS WITHDREW PN548
EXHIBIT #AWU1 OUTLINE OF SUBMISSIONS FROM THE AWU PN551
KENNETH ALFRED GADSDEN, AFFIRMED PN562
EXAMINATION-IN-CHIEF BY MS WALTERS PN562
EXHIBIT #AWU2 WITNESS STATEMENT OF KENNETH GADSDEN PN593
CROSS-EXAMINATION BY MR MURPHY PN658
WITNESS WITHDREW PN745
AustLII:
Copyright Policy
|
Disclaimers
|
Privacy Policy
|
Feedback
URL: http://www.austlii.edu.au/au/other/AIRCTrans/2004/2174.html