AG2004/5256, Transcript of Proceedings [2004] AIRCTrans 2772 (19 July 2004)

AUSCRIPT PTY LTD
(Administrator Appointed)
ABN 76 082 664 220

Level 4, 179 Queen St MELBOURNE Vic 3000
(GPO Box 1114 MELBOURNE Vic 3001)
Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS


O/N 7769

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

COMMISSIONER LEWIN

AG2004/5256

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LK of the Act
by Aroma Science Pty Ltd (Aveda) for
certification of the Aveda Aroma Experience
Certified Agreement 2004

MELBOURNE

10.10 AM, THURSDAY, 8 JULY 2004

PN1

MS T. ROWE: I am from the Victorian Employers Chamber of Commerce and Industry appearing on behalf of Aveda Aroma Science Pty Limited, which I will call from now on Aveda to make it easier. Appearing with me is MS N. RANNO, the General Manager of Finance and Operations on behalf of the company, and on behalf of the employees, MS C. FERRO.

PN2

THE COMMISSIONER: Thanks, Ms Rowe.

PN3

MS ROWE: Commissioner, we make application under division 2, section 170LK of the Workplace Relations Act for certification of the Aveda Aroma Science Agreement. The parties to the agreement are confident that all the requirements of the Act, rules and regulations, have been met. Documents have been submitted to the Commission, being a stat dec from the company and the proposed agreement. If the Commission likes, I can go through the process that the company went through.

PN4

THE COMMISSIONER: If you are just going to recite the statutory declaration, that is not necessary.

PN5

MS ROWE: Yes.

PN6

THE COMMISSIONER: It is probably better if I just ask you some questions about it and see whether there are any issues.

PN7

MS ROWE: That is fine, Commissioner.

PN8

THE COMMISSIONER: Can I draw your attention to that part of the statutory declaration which deals with the 170LK(4) requirements; that is in 5.6.

PN9

MS ROWE: Yes.

PN10

THE COMMISSIONER: Did you file? I can't see on the file the notice.

PN11

MS ROWE: No, we didn't file.

PN12

THE COMMISSIONER: Can you file the notice?

PN13

MS ROWE: No, not today; I actually don't have a copy on me.

PN14

THE COMMISSIONER: Right. But you can file it in due course?

PN15

MS ROWE: I can file it in due course, yes, Commissioner.

PN16

THE COMMISSIONER: All right. I would like to sight the notice.

PN17

MS ROWE: Yes, Commissioner.

PN18

THE COMMISSIONER: The reason why I need to sight the notice is that there have been some recent decisions of Full Benches of the Commission concerning the content of the notices. As you appreciate, that provision is part of the mandatory provisions of the Act. If it has not been complied with, then the agreement can't be certified, so I think I need to sight the content of the notice.

PN19

MS ROWE: Yes.

PN20

THE COMMISSIONER: I accept that a notice was provided, but the content of the notice is relevant to the application as well.

PN21

MS ROWE: Commissioner, we can organise for that to be faxed over to your chambers as soon as possible.

PN22

THE COMMISSIONER: All right. Now, the only other aspects are not so much with the statutory requirements for the making of the agreement, but for consideration of the matters in respect of which I have to be satisfied for the purposes of certification, and they largely concern my ability to be satisfied that the agreement passes the no disadvantage test. I have read the agreement; I appreciate that the hourly rates are loaded up - - -

PN23

MS ROWE: Yes.

PN24

THE COMMISSIONER: - - - to compensate for various incidence of the employment, and intuitively I would be inclined to think that the agreement would meet the no disadvantage test. However, given that there are several awards involved and different classifications with differing rates of pay, some of which are federal awards and some are state awards, I think it is necessary for some documentation of the relevant information to the consideration of the no disadvantage test to be provided.

PN25

MS ROWE: Commissioner, what we did, and I wouldn't submit this today because it is very rough as you see - - -

PN26

THE COMMISSIONER: All right.

PN27

MS ROWE: - - - what the company did, we took into consideration every award; from there, took into consideration the classification level of the employees - - -

PN28

THE COMMISSIONER: Yes.

PN29

MS ROWE: - - - and then looked at the highest rate of pay for those classifications and then the allowances. Whichever one was the highest from those awards, that is what we based the no disadvantage test on. So we didn't do it individually by award, we just took the highest and the most applicable rate across the board of the - about six awards I think there is. Then we looked at the worst case scenario of an employee working under those awards and calculated our rates from there. So again I have some calculations - - -

PN30

THE COMMISSIONER: May I see that? You don't need to tender it today if you want to do some more work on it, but you could foreshadow that you will file it with me in due course.

PN31

MS ROWE: Yes, most certainly, Commissioner, it has just got a lot of scribble on it, that is all.

PN32

THE COMMISSIONER: All right, because the hours provisions from my recollection are - there are a number of agreements on this morning obviously, but the hours provisions provide for a sort of a maximum number of hours to be worked in a particular period of time; is that right?

PN33

MS ROWE: That is correct.

PN34

THE COMMISSIONER: Now, what clause is that again - and they would all be worked at the loaded rate.

PN35

MS ROWE: They would be, yes, Commissioner. The only penalty within the agreement is for public holidays at 200 per cent.

PN36

THE COMMISSIONER: Yes, that is right.

PN37

MS ROWE: And the casual loaded rate.

PN38

THE COMMISSIONER: Yes.

PN39

MS ROWE: Clause 9 sets out the working time and - so we have full time - it is defined as full time, part time and prime time, which is slash, casual employees and it provides that they be rostered for a 76 hour fortnight to a maximum - - -

PN40

THE COMMISSIONER: But they can be rostered to 90.

PN41

MS ROWE: To 90, yes - to a maximum of 90, that is correct. That is the same for part time employees.

PN42

THE COMMISSIONER: So do the calculations that you have now - you have tabled, are they based on the 90 hours scenario?

PN43

MS ROWE: They are based on a 38 hour week, Commissioner.

PN44

THE COMMISSIONER: Right. Would you be able to do it for the 90 hours scenario?

PN45

MS ROWE: Yes.

PN46

THE COMMISSIONER: Because that is the maximum potential for any disadvantage to arise, is it not?

PN47

MS ROWE: Yes.

PN48

THE COMMISSIONER: Right. In that scenario.

PN49

MS ROWE: Yes.

PN50

THE COMMISSIONER: Because the greater the number of hours the more likely the penalty rates of the award are to be soaked up into the margin between the award rate - - -

PN51

MS ROWE: Yes.

PN52

THE COMMISSIONER: - - - and the loaded rate; isn't that right?

PN53

MS ROWE: Yes, that is correct.

PN54

THE COMMISSIONER: All right. Well, I direct that you do that. Would it be possible to do that by the close of business on Monday?

PN55

MS ROWE: That is possible, Commissioner, yes.

PN56

THE COMMISSIONER: All right. Well, I direct that you do that by the close of business on Monday. Could I just ask you about clause 12, superannuation? There have been some public announcements and I am not quite sure what the legislative situation is, but the legislation may have passed the parliament that employees will have a right to elect which superannuation fund the employer makes the superannuation guarantee contributions to. That is the situation, isn't it?

PN57

MS ROWE: My understanding, yes, it is, Commissioner, yes.

PN58

THE COMMISSIONER: In this agreement the agreement states that Aveda or Aroma Science would nominate the fund.

PN59

MS ROWE: It is also in accordance with the Superannuation Guarantee Administration Act, so if that is amended then we will be applying these - the provision of the legislation.

PN60

THE COMMISSIONER: Yes, yes. It could be read so that you could nominate the fund provided that that fund complied with the legislation.

PN61

MS ROWE: Yes.

PN62

THE COMMISSIONER: Can you give an undertaking that the agreement will be applied in such a way that is consistent with the employees' right of choice?

PN63

MS ROWE: If I can just seek some instructions, Commissioner.

PN64

THE COMMISSIONER: Yes.

PN65

MS ROWE: We can give that undertaking, Commissioner.

PN66

THE COMMISSIONER: Yes. Thanks. I think you would appreciate, Ms Rowe, that the no disadvantage test is not just related to the award - - -

PN67

MS ROWE: Yes.

PN68

THE COMMISSIONER: - - - but it is related also to any other relevant legislation and it seems to me that given that the topic of the clause is superannuation, then the superannuation legislation is relevant for the purposes of the no disadvantage test.

PN69

MS ROWE: Yes.

PN70

THE COMMISSIONER: And that legislation provides now, as I understand it, a right to employees to make a choice. It is a rather significant issue and accordingly I think it is appropriate that the matter be given some attention and I am satisfied with the undertaking. Thank you.

PN71

MS ROWE: Thank you, Commissioner.

PN72

THE COMMISSIONER: That will be recorded in due course in my decision in relation to this matter.

PN73

MS ROWE: Thank you, Commissioner.

PN74

THE COMMISSIONER: Could you just help me in how you approach the sick leave entitlements - I am sorry, first the annual leave entitlements. I understand the concept that leave accrues on the basis of hours worked; isn't that right, paragraph 1 of 17.1?

PN75

MS ROWE: No, it would be based on the 76 hour fortnight, so four weeks - 152 hours of annual leave per 12 months calculated on the 38 hour week.

PN76

THE COMMISSIONER: That is not what the second sentence says, with respect.

PN77

MS ROWE: Entitlement accrues at the rate of point 7 of hours of annual leave per hour paid, okay - no, I understand, Commissioner. No, the intent was for a - - -

PN78

THE COMMISSIONER: It is a calendar basis of accrual?

PN79

MS ROWE: A calendar basis of 12 months, yes.

PN80

THE COMMISSIONER: Yes.

PN81

MS ROWE: Based on 38 hours - - -

PN82

THE COMMISSIONER: Rather than hours worked - accrual.

PN83

MS ROWE: Rather than the hours worked, yes.

PN84

THE COMMISSIONER: That is contrary to what the agreement says.

PN85

MS ROWE: That is the intent of the clause, Commissioner.

PN86

THE COMMISSIONER: All right. Would you be able to give an undertaking to the effect that the rate of accrual of annual leave for other than casual employees will be based on the period of their service?

PN87

MS ROWE: Rather then the hours worked.

PN88

THE COMMISSIONER: Annual leave as it is prescribed by the award accrues on the basis of a period of service.

PN89

MS ROWE: Yes, I will seek instructions, Commissioner. We will give that undertaking, Commissioner.

PN90

THE COMMISSIONER: All right. Well, perhaps the undertaking might be better in this form, that no employee would receive a lesser amount of annual - would accrue a lesser amount of annual leave than they would under the terms of the relevant award.

PN91

MS ROWE: We can give that undertaking that no employee would be.

PN92

THE COMMISSIONER: I am just being cautious. It works - it cuts both ways and given the state awards there may be some variations in the rate of accrual.

PN93

MS ROWE: Yes.

PN94

THE COMMISSIONER: But if you say to me that no employee will accrue any less annual leave than they otherwise would under the terms of an award and you give that undertaking I will be satisfied.

PN95

MS ROWE: Commissioner, we can give the undertaking no employee would accrue less than the relevant awards.

PN96

THE COMMISSIONER: Thank you. Could I just indicate to you that I would like you to actually record these undertakings in writing on behalf of the company and file them with my office.

PN97

MS ROWE: Certainly, Commissioner.

PN98

THE COMMISSIONER: It is a similar situation with sick leave, is it not?

PN99

MS ROWE: It is Commissioner, yes.

PN100

THE COMMISSIONER: Is the undertaking available in relation to sick leave as well?

PN101

MS ROWE: Yes, Commissioner.

PN102

THE COMMISSIONER: Well, that could be filed too. In clause 22, redundancy, it seems to me that that provisions as to notice are as follows: that an employee will receive two weeks' notice or payment in lieu of notice.

PN103

MS ROWE: That is correct.

PN104

THE COMMISSIONER: Isn't that in conflict with section 170CM of the Act?

PN105

MS ROWE: Which provides for the tier based notice.

PN106

THE COMMISSIONER: Yes, of notice based on service.

PN107

MS ROWE: Yes, it is, Commissioner.

PN108

THE COMMISSIONER: So isn't it the case that the agreement doesn't actually provide the necessary statutory notice?

PN109

MS ROWE: It doesn't, Commissioner, no.

PN110

THE COMMISSIONER: Can the employer give an undertaking that in relation to notice that no employee will receive any less notice than is prescribed by section 170CM of the Workplace Relations Act?

PN111

MS ROWE: Yes, we can give that undertaking.

PN112

THE COMMISSIONER: All right. When I receive the comparison for the working of the maximum number of hours per fortnight in the same form as you have submitted previously, which I will simply mark for the record as A1.

EXHIBIT #A1 COMPARISON FOR THE WORKING OF MAXIMUM NUMBER OF HOURS PER FORTNIGHT

PN113

THE COMMISSIONER: And I receive a letter outlining the undertakings that have been given on the transcript this morning, and if I am satisfied that the information filed demonstrates that the agreement passes the no disadvantage test I would certify the agreement without further attendance by the parties at the Commission. Thank you.

PN114

MS ROWE: Thank you, Commissioner.

PN115

THE COMMISSIONER: This matter is adjourned. Thank you.

ADJOURNED INDEFINITELY [10.25am]

INDEX

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #A1 COMPARISON FOR THE WORKING OF MAXIMUM NUMBER OF HOURS PER FORTNIGHT PN113