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Australian Industrial Relations Commission Transcripts |
AUSCRIPT PTY LTD
ABN 76 082 664 220
Level 6, 114-120 Castlereagh St SYDNEY NSW 2000
PO Box A2405 SYDNEY SOUTH NSW 1235
Tel:(02) 9238-6500 Fax:(02) 9238-6533
TRANSCRIPT OF PROCEEDINGS
O/N F8787
AUSTRALIAN INDUSTRIAL
RELATIONS COMMISSION
COMMISSIONER SIMMONDS
C2003/5437
C2003/6368
ROCHE MINING PTY LIMITED
and
CONSTRUCTION, FORESTRY, MINING
AND ENERGY UNION
Notification pursuant to section 99 of the Act
of a dispute re implementation of nine hour
shifts at Tahmoor Colliery
TAHMOOR COAL PTY LIMITED
and
CONSTRUCTION, FORESTRY, MINING
AND ENERGY UNION
Application under section 170LW of the Act
for settlement of dispute re proposed nine hour
shift roster
SYDNEY
10.15 AM, THURSDAY, 15 JANUARY 2004
Continued from 11.11.03
PN308
THE COMMISSIONER: Any changes to appearances in this matter?
PN309
MR A. BUKARICA: If the Commission pleases, we need to announce in addition to myself the appearance of MR. G. OSBORNE, for the union.
PN310
MR CUTHBERTSON: No other changes, Commissioner.
PN311
THE COMMISSIONER: Thank you. Yes, Mr Bukarica?
PN312
MR BUKARICA: If the Commission pleases, there's a couple of preliminary housekeeping matters that I might address. Firstly, the Commission will notice that there are two witness statements submitted on behalf of the union, one in the name of Mr Fitzpatrick and the other from Mr White. Unfortunately between the Christmas period and now I've lost one witness, I understand he's overseas and on holiday, and that's Mr White.
PN313
I also understand that there would be objection to the statement being tendered without him being available for cross-examination so accordingly we'd seek not to press or rely on upon that statement. I'm also aware from Mr Cuthbertson that one of his witnesses is in a similar position, Mr Newman, and accordingly as I understand it that evidence won't be relied upon but Mr Cuthbertson can confirm that.
PN314
MR CUTHBERTSON: That's correct, Commissioner.
PN315
MR BUKARICA: Commissioner, in terms of the batting order there is an agreement as to the witness evidence and that is that we proceed today on the basis of Mr Ray Johnson being first, Mr Kay, is also an advocate, being second. For our part, of the Roche witnesses we'd only seek to cross-examine Mr Duncan, so he would be third, and then followed by Mr Fitzpatrick. For our part hopefully our cross-examination won't be very long and accordingly we might be able to get through the witness evidence fairly quickly, that's our hope in any case.
PN316
Commissioner, before we go to the evidence I do want to make some opening submissions arising from some of the submissions that are before the Commission as presently constituted and as well some remarks that the Commissioner made at the last hearing of this matter. Firstly, if I could address the issue of the power of the Commission and what precisely - - -
PN317
THE COMMISSIONER: I'll just get rid of Mr Newman's statement out of the documents first of all and then I'll have my paperwork in order.
PN318
MR BUKARICA: Yes, also whilst we're doing that, Commissioner, could I ask if the Commission does have before it the written outline by the CFMEU.
PN319
HE COMMISSIONER: I'll mark that in a minute. But Mr Duncan and Mr Hayward are to be giving evidence for Roche, and I have all of that. Mr Fitzpatrick, for you and I have that. Mr Kay and Mr Johnson from Tahmoor.
PN320
MR BUKARICA: That's correct, yes.
PN321
THE COMMISSIONER: You're not wishing to - - -
PN322
MR BUKARICA: Cross-examine, Mr Hayward.
PN323
THE COMMISSIONER: Cross-examine, Mr Hayward.
PN324
MR BUKARICA: Yes. So that would be admitted, Commissioner, without objection.
PN325
THE COMMISSIONER: Yes, thanks.
PN326
MR BUKARICA: Sorry, Commissioner, as I understand it one of Mr Kay's witness is also not here, he is expected to be here but perhaps if we can start with Mr Kay then, but we'll play it by ear. If the Commission pleases, the union - - -
PN327
PN328
MR BUKARICA: Commissioner, we would seek to rely on submissions outlined in that written document and also we would expand upon those both in opening and in reply. I was going to at the outset address the Commission on the issue of the powers of the Commission and the Commissioner on the last occasion remarked that the law on private arbitration matters is ever evolving and that's certainly the case.
PN329
THE COMMISSIONER: I had some advance knowledge of a matter in that case.
PN330
MR BUKARICA: Yes, and I'm not sure if I referenced that in our written outline but in any case the point I wish to make is that the private arbitration powers have been viewed in an expansive way by this tribunal and there is authority now which is fairly settled that provided that the necessary consent is forthcoming from the parties, and this is one such case, then the Commission has a fairly large discretion and a fairly wide ambit of power to determine the matters in dispute.
PN331
Now, we say of course that all depends on the question of the application of an agreement and that is what is before the Commission. But the issue really is how does a Commission give effect to what was intended by the parties and in doing so settle or avoid disputation over the application of an agreement. So within those parameters the Commission we say is fully entitled, if it is convinced of the merits, to issue a decision or recommendation of the type we contend in paragraph 4 of our written outline.
PN332
Now, it would be seen, Commissioner, that that relief that we seek is in a form of authority as to the nature of the agreement between the parties and if I could paraphrase the argument between the parties as I see them in this matter it goes to the nature of the agreement, on the one hand the employer parties saying the agreement is simply that which appears in the two certified industrial instruments and that they speak for themselves and that is totality of the agreement.
PN333
The union for its part says that that is not correct there is indeed a broader set of understandings without considering which the agreement cannot be given proper effect, indeed cannot work in the way it was intended, and when I say the agreement it will become plain to the Commission that really in these proceedings what the union says is that we don't really seek any sanction or relief at all against Roche in this matter. Our argument is primarily with the head contractor, Austral Coal, and really the argument is what is the nature of the agreement between the CFMEU and Austral Coal. If the Commission finds at the end of the day in favour of the contention that we submit is the true agreement then the Roche position falls into place.
PN334
Now, that raises of course the question that the Commissioner raised on the last occasion about the inter-relationship between head contractors and agreements reached between a head contractor or a principal and a union and what effect if any such an agreement can have on a sub-contractor. Now, we say there is authority both in this Commission and in the New South Wales Industrial Commission which supports the proposition that so long as an agreement does not seek to directly regulate the terms of subcontractors, that is by its own wording, then an agreement between a union and a head contractor to the effect that the head contractor shall manage its business in a certain way to ensure certain standards are abided by or are complied with is an entirely acceptable and indeed not uncommon feature of the industrial landscape.
PN335
One recent decision which we say is on point on this question is a decision by his Honour Senior Deputy President Watson in re Sheraton Towers Southgate and the ALHMWU Employee Relations Agreement 23003. The print number is PR 935830. The decision relates to a certification of an agreement where a hotel chain essentially entered into an agreement with the ALHMWU to the effect that contractors or subcontractors on its projects would meet certain minimum conditions of employment in respect of their own employees.
PN336
What Senior Deputy President Watson concluded was that the agreements as they stood before him could not be certified because the particular wording used in those agreements attempted to directly regulate subcontractors and there wasn't the requisite employment relationship between the head contractor and the union with respect to that issue. However, the Senior Deputy President did find that with a slight variation to the wording, the agreements could be certified and they could have the effect of committing the employer, that is the head contractor, Sheraton, to ensure that the contractors meet certain conditions of employment in respect of their operations and indeed the Senior Deputy President put forward an alternative set of words which appears on the last page of the decision which he submitted would satisfy the law and the objects of the two parties to the agreement.
PN337
Commissioner, I hand up a copy of that decision, I didn't hand it up earlier because I am a bit short of copies, but we would rely on his Honour's decision in that matter and we say that the type of finding we ask the Commission to reach in this matter is analogous to that which the learned Senior Deputy President concluded was a valid matter that could be contained in a certified agreement, that is, between the CFMEU and Austral Coal, the head contractor.
PN338
Similarly, there has been a decision recently in the New South Wales Industrial Commission by his Honour, Vice President Walton, and I hand up a copy of that decision, regarding the Lend Lease Hotel Intercontinental Stage One Project Award and Another, New South Wales IR Commission, 314, a decision of September last year. The Commissioner will be aware from your prior involvement in the construction industry panel that project agreements in construction are a common feature.
PN339
This decision essentially gives effect to a project agreement in the form of a State award and in the context of making that State award his Honour, Vice President Walton, was given cause to contemplate whether there was sufficient nexus in law between the union and the head contractor and the affected employees in that matter to make the award and he concluded that there was. Accordingly, he made the award.
PN340
This again is simply support for the proposition that the regulation of subcontractor terms and conditions by an industrial agreement or an understanding between a union and a head contractor is not of itself an unfamiliar or improper I should say industrial situation. It is a matter which this Commission and the New South Wales Industrial Commission have addressed, so I just make those general remarks, Commissioner.
PN341
Similarly, in respect to what the Commission is being asked to do in terms of the industrial instruments before it, both the Tahmoor agreement and the Roche agreement, Mr Cuthbertson on behalf of Roche made some written submissions concerning appropriate principles of interpretation and he relies upon a decision of his Honour Vice President Lawler, from which we don't demur. However, we make these general submissions about what is currently before the Commission.
PN342
Firstly, as we have said in opening, the Commission is here today to look at the totality of the agreement and to try to resolve a dispute as to its application, so strictly speaking it is not a narrow interpretation matter in our submission, it is matter of resolving a dispute as to the application of an agreement. We say that the principles of interpretation are relevant, however, and whilst the general rule in his Honour Vice President Lawler's decision which forms part of Mr Cuthbertson's submission is correct, that is, where there is no ambiguity in a written instrument, then recourse to extrinsic material or evidence is impermissible.
PN343
Whilst that is generally correct, we say it is not relevant in the present matter and we say that for two reasons. One is that our argument essentially is not with the Roche agreement, it is with the Tahmoor agreement, that is the agreement and understandings that are between the CFMEU and Austral Coal. Secondly, we say that in any proper consideration of the Tahmoor agreement, in particular clause 32.7 which has been referred to on a number of occasions to the Commission already, at least in the conciliation proceedings, we will be saying that there is clear ambiguity in terms of what that clause means, otherwise, with respect, we wouldn't be here before the Commission.
PN344
Commissioner, the strict or narrow approach to interpretation does not apply for two reasons. One is that really it is not the Roche agreement which is the subject of debate. We have accepted in our submissions that the wording there appears to be relatively straightforward. What is in dispute is the head contractors agreement, in particular the meaning pertaining to clause 32.7 of that agreement. Just to reiterate, the union's position is that clause 32.7 is not the complete story and cannot be understood unless the general understandings between the parties are taken into account.
PN345
Finally, just for completeness, Commissioner, in respect to issues of interpretation, if the Commission is concerned that it is an issue that needs to be properly addressed, I also rely on a decision that I had some involvement with in the Chief Industrial Magistrate's Court, the matter of John Epton and Others, a decision of Chief Magistrate Miller, where these issues of correct approaches to interpretation were aired.
PN346
In particular his Worship in that matter approved of two contentions of the union, one being that what is sometimes referred to as the purposive approach to award interpretation is a valid one in that particular matter, not merely the words of an industrial instrument but the purpose of the parties to it objectively ascertained is a correct approach in certain matters to award interpretation. Secondly, that awards as a general principle, and we submit in this instance certified agreements have the same effect, awards should be interpreted in a beneficial way, that is, they are intended to be instruments of benefit to employees and where there are two contending interpretations put forward awards should generally be interpreted in a way which is beneficial to employees where the words allow it be done so.
PN347
Now, it may be that the Commission finds it is not necessary to consider in any detail those sort of principles but just because the issues of the interpretation have been raised and raised seriously, in respect to my colleague I make those submissions and I tender a copy of that decision, if the Commission pleases, and I'll hand one up.
PN348
So, Mr Commissioner, they are our opening submissions and we'd seek now that the evidence be - unless there any questions or preliminary matters from my friends that the evidence be brought forward.
PN349
THE COMMISSIONER: Yes, I note that you're not going to be bringing your witness first.
PN350
MR BUKARICA: No.
PN351
THE COMMISSIONER: It is to be Mr Johnson, isn't it or Mr Kay?
PN352
MR BUKARICA: Yes, Mr Johnson.
PN353
THE COMMISSIONER: Mr Johnson. Mr Kay, do you wish to make any opening submission before you put in your witness?
PN354
MR KAY: No, Commissioner.
PN355
PN356
THE COMMISSIONER: Yes, Mr Kay?
PN357
MR KAY: Commissioner, if I just ask Mr Johnson if he could confirm that the witness statement that has been provided is correct and I'll just table a copy of that, if I may.
PN358
THE COMMISSIONER: You'd better give him a copy to look at just to confirm.
PN359
MR KAY: Yes.
PN360
THE WITNESS: I confirm that, your Honour.
PN361
PN362
MR BUKARICA: Mr Johnson, you submitted a statement dated 22 December 2003, is that correct?---Correct.
PN363
It is a statement of some just three paragraphs?---Correct.
PN364
But the statement reads importantly that you've read the witness statement prepared by Mr Kay and you concur with his comments concerning the origins of clause 32.7 of the Tahmoor agreement?---Correct.
PN365
Can I take it from that, Mr Johnson, that you are familiar with Mr Kay's evidence?---That's correct.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN366
Do you have a copy of Mr Kay's statement before you?---Not in front of me, I don't.
PN367
Perhaps if Mr Johnson had a copy of that. Can I refer you to the second page of Mr Kay's statement and there appears to be a problem with the numbering. On the second page, at least on my copy there is a new paragraph 2 which is probably paragraph 5. Can you see that, paragraph 2?---I do.
PN368
The second paragraph of paragraph 2 there's a statement. I'm aware also that most contractors today have their own arrangements with their employees and those agreements usually have provisions covering rosters and these provisions potentially provide for different roster arrangements than at apply at Tahmoor. Do you see that?---I see it.
PN369
Do you confirm that statement?---I do.
PN370
Now, is it the case, Mr Johnson, that of the core contractors at Tahmoor, and putting aside Roche for the present purposes, that the core contractors at Tahmoor all work a roster system provided in appendix 1 of the Tahmoor agreement?---No, that's not correct.
PN371
Are there any core contractors who work a different roster at Tahmoor at present?---There are from time to time, yes.
PN372
Are you able to name who they might be?---A recent roster arrangement which was involved in construction of our coal preparation plant worked different rosters. They are also respondent CFMEU members in the coal preparation plant.
PN373
Mr Johnson, I asked you about core contractors, do you understand that concept? Do you understand that the contractors who are more or less permanently engaged on the Tahmoor site?---Well, no I don't understand and maybe you can assist me.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN374
Yes. Would it be the case, Mr Johnson, that there are - and correct me if I'm wrong - a number of contractors engaged in the Tahmoor mine site who undertake work which is traditionally or might have traditionally been done by direct employees of Tahmoor?---There are.
PN375
Companies such as Valley Longwall?---Do you describe those as core?
PN376
I'm asking you, you're the witness, Mr Johnson?---What I'm saying is that we have various contractors. Valley Longwall have a very short duration of seven or eight months, there are other contractors that have durations of two and three years so if you describe them as a core contractor I would not.
PN377
What about Ground Consolidation?---Yes.0
PN378
Allied?---Allied have been there for a short period, yes.
PN379
Walters Mining?---Walters Mining have worked at Tahmoor spasmodically, of late they are back on the site but they basically by the sheer nature contractors work for the business and when the contract is completed by leave. You describe them all as core and I'm not understanding what you mean by core.
PN380
Let us try and clarify it. The contractors that I've mentioned, for example, Ground Consolidation, Allied, Walters, they do production work do they not?---In what sense?
PN381
That is being involved in the extraction of coal from the mine?---No, not all of them, no, very few in fact, Roche, is at the moment the only one.
PN382
Now, Mr Johnson, are you saying that you don't understand at all the notion of a core contractor?---I believe I understand it but I'm not sure that what you're telling me that you quite understand it.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN383
The union, the lodge and the company have indeed - that you're part of - have indeed entered into agreements concerning core contractors, is that not the case?---They have entered into agreements with the term we would use on the site is major contractors.
PN384
Major contractors, not core contractors?---Major contractors. We have a whole variety of contractors.
PN385
I'm reminded by Mr Fitzpatrick. Are you familiar in general terms of the Tahmoor mine site agreement?---In general terms, yes.
PN386
In clause 32.1.2 there's the term "All contractors who perform main core CFMEU functions will be paid the same base rate as a permanent work force etcetera"?---Yes.
PN387
Now, in the context of that wording can you assist us as to what core contractor means?---I presume from that wording that it is contractors that do mining related work at Tahmoor underground, mining related work.
PN388
The position is, is it not, that those type of contractors have almost, well exclusively, with the recent situation arising with Roche, all worked a roster arrangement provided for under appendix 1 of the Tahmoor agreement?---I can't state that with certainty. There is significant variation with rosters and with contractors at Tahmoor, there is a whole variety of the rosters worked.
PN389
Mr Johnson, in the Tahmoor agreement there's appendix 1. Are you familiar with that?---You might have to remind me, I don't memorise page numbers.
PN390
Mr Johnson, if you don't know, if you think this may be a question we should be asking Mr Kay or somebody else, please say so?---I am trying to assist you.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN391
Yes, but Appendix 1 and a moment ago you said you were familiar with the agreement but Appendix 1 provides for a number of different work patterns. Do you accept that?---For Tahmoor employees, yes.
PN392
What I am putting to you is that those core contractors or core CFMEU contractors that are referred to all have one of those work patterns provided for in that agreement?---What I am saying to you is they may at any one time but not necessarily and not exclusively. they may have, they may well now but not exclusively.
PN393
Mr Johnson, I put to you that prior to the current situation with Roche Contracting emerging that there was no issue at your mine site concerning rosters of core contract companies?---And I would agree that's a fair statement.
PN394
They all indeed worked one of those Appendix 1 rosters?---They all work rosters that suited their conditions and their employees.
PN395
Picked from appendix 1?---I can't say that. They don't use our roster arrangements to pick their business rosters, I can assure you of that.
PN396
Mr Johnson, are you trying to tell the Commission that it's a coincidence that all core CFMEU contractors at your site for the last 20 or more years have all just coincidentally worked a roster pattern the same as that which is provided for your direct employees?---What I am trying to explain to you is that in normal mining operations we're in a major expansion program. In normal run of the mill mining operations it may well be convenient for Tahmoor and convenient for the contracting company to work rosters that are similar. It may well be convenient to our business but most of those contractors tend to be local contractors. In this particular instance, the contractor that we are referring to which is Roche, is a different sort of contractor that we have worked in the past because it is not a local contractor. That's what I am trying to allude to here.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN397
But you are not disputing are you, Mr Johnson, that for the last 24 years or so of the mine's operation that these core contractors that we've described have worked one of those Appendix 1 rosters, do you accept that?---I would say that's generally right. I wouldn't say that absolutely. There may well have been variations.
PN398
Can you point to a core contractor that has?---There may have been a drilling contractor that worked a four day week rather than a five day week.
PN399
Are you able to say who that is?---It could have been Lucas Drilling.
PN400
It could have been?---Could have been. I don't have specific knowledge.
PN401
I put to you that there's been a long standing agreement or understanding at your mine site that core contractors work the same rosters as Tahmoor direct employees. That is, one of the rosters provided for in Appendix 1. I put to you that's the case?---I put to you that that's not necessarily correct.
PN402
Not necessarily correct?---No.
PN403
Well, is there an agreement or isn't there an agreement, Mr Johnson?---For what? We have an agreement for our employees to work certain rosters and they are in the Appendix, EA. We don't necessarily have an agreement that all people who visit the mine must work that precise roster. We never have, we never will.
PN404
I don't quite understand the use of the word necessarily. You either have an agreement or you don't. Which one do you say is the one?---I have an agreement with my employees about the rosters that will be worked by my employees under that enterprise agreement. I don't have an agreement with contractors what roster they will work. I never have.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN405
So coming back to an earlier question I put to you. You say then it's coincidence or convenience that for 24 years these core contractors have all worked the same rosters as your direct employees?---I am not sure where you get the 24 years from.
PN406
How long has the mine been open?---Probably since about '82. But in any case I don't have specific knowledge when the mine started. I've no doubt that there was a whole variety of rosters when the mine was established because it was a major undertaking and what I said to you earlier is that the rosters that are being worked right now are somewhat unusual because the simple fact that we are going through a $200 million expansion. In normal activities where we are mining and all we are doing is some out-by work or some support work then it's much more likely that contractors will work similar roster arrangements to our people because most of those contractors are actually local people.
PN407
So - - -?---This is not the case as I speak now.
PN408
Are you saying this, Mr Johnson, that at the Tahmoor mine site that it's laissez-faire or anything goes in terms of what the contractors do in terms of hours of work and wages and conditions and so on on site, is that the position?---I don't recall saying that.
PN409
Now, I am just asking you is that the position?---Of course not.
PN410
And in fact there are direct directions from the company are there not, that is Austral Coal to its subcontractors that on that site that they, for example, must pay as a minimum the district bonuses, that's correct?---There are agreements that are contained within our EA that employees who do mining work underground are paid similar wages, not similar bonuses. In actual fact the bonuses can be different. Our employees are paid production bonuses. Contractors are generally paid what they call average district bonus which may at times be different to the bonuses we pay.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN411
Yes?---We call that similar bonuses and similar wages.
PN412
How does Austral Coal Tahmoor Mine ensure that that is the case that the subcontractors pay those bonuses?---Normally the contractor in preliminary negotiations would be made aware of the fact that for the work that they are doing they are obliged to pay, if you like, the rates that are paid within our EA.
PN413
Yes?---That's fairly common across the south coast. We don't police it.
PN414
You don't police it?---We don't need to.
PN415
But is it the case, Mr Johnson, that it's basically this, you contractually enforce at least that condition amongst contractors, that you make it a condition of tender?---We have never - in my time we have never had a need to contractually enforce it. Most contractors are willing to abide by those conditions.
PN416
Because you say, if you want to work on this job you will pay A, B and C?---We are one of the parties that says that. There is another party that also has a fairly large input into that also, as you would be aware.
PN417
So, a condition of working on the Tahmoor mine site is that they pay these bonuses. Another condition is pay rates, being at a certain minimum level?---Correct.
PN418
Now, against that then you say that rosters are treated differently, is that what you are saying Mr Johnson?---That's exactly what I'm saying.
PN419
I put to you, Mr Johnson, that the arrangements that have been in place at the Tahmoor mine are that, to use Mr Fitzpatrick's words, "when in Rome do as the Romans do" in respect of contractors. Do you understand that general saying?---I understand the concept, yes.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN420
And I put to you that wages, bonuses and rosters are the three non-negotiable elements for contractors on the Tahmoor mine site?---I put to you that is incorrect.
PN421
Why is it incorrect?---The first two matters wages and bonuses, certainly from our EA and custom practise that is adhered to. As far as the rosters, I mean we have had significant discussions over the last 10 years about the precise wording of rosters. Our wording, and I can't quote it verbatim, our wording in our enterprise agreement says that we will not use rosters worked by third parties or contractors as a precedent to force employees to work the same roster. There is nowhere in our EA, there is nothing in the discussions that I have had in the last 8 years, 10 years, at Tahmoor that would suggest that we would enforce a contractor to work our roster. What we are saying is that rosters worked by contractors will not be used as a precedent to change the rosters within our employees and there are clauses within our EA that give our employees a level of protection that we will not enforce on them another roster by, if you like, using a contractor as a precedent and it is written specifically that way.
PN422
I see. Well, Mr Johnson, I might turn to that clause 32.7 in a moment and what the company does with it. Just to reiterate then your evidence, and correct me if I am mis-stating it, you are saying for 20 years at least there has been a situation at the Tahmoor mine where bonuses, wage rates have been contractually enforced at the site for contractors, that's correct?---I'm saying in my term at Tahmoor which starts in 1990. I am not able to speak before then.
PN423
Sorry, 1990, is that the date you say?---Yes.
PN424
So for at least 12 years, wages bonuses non-negotiable, that's correct?---Bonuses and wages are generally paid according to our EA which is prescribed and bonuses according to district agreements which are similar to our bonuses, not the same.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN425
When you say generally, is there a qualification there?---For the bonuses?
PN426
And wages. Generally seems to imply that there are occasions when it doesn't happen?---Yes, that's right. There are occasions if our mine is on full production with the long mill operating all our employees are paid mine bonus and the mine bonus - - -
PN427
I understood that. No, you prefaced your answer with the word "generally" and that implies that there are some occasions when it doesn't happen. No I understand that the contractors might get the district bonus whereas your workers might be getting a production bonus that is greater than that and that's all?---That's what I am applying the word "generally" to.
PN428
The word "generally" doesn't mean that there are occasions when it doesn't happen?---They are always paid bonus but what I am saying is that the bonus will vary.
PN429
I understand so that you could take that word "general" out and describe it like this, that they get the same basic rates, and they get the bonus either the district bonus or the production bonus, depending on the circumstances?---That is correct. And without complicating it there are a few other variations such as development bonus which is just another little complication.
PN430
So I think we understand your evidence on that Mr Johnson. Now, you also accept at least during your time, and I think you mentioned one drilling contractor which may have had a different roster arrangement, but you accept generally do you not that one of the appendix 1 rosters is what all core CFMEU contractors have done, or implemented, on your site for your term?---Generally that is correct. I can't specifically drag up an occasion where there was a contractor that was working on your description of core activities. Of course there are a lot of contractors that worked different rosters for specific tasks, for installing belts, working 12 hour shifts. There are lots of exceptions but on the activities underground - - -
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN431
All contractors?---Generally that is the case.
PN432
Yes, generally. Well again, are you able to point to any exceptions to that rule?---On your description of core activities, none come to mind.
PN433
Yes and indeed they are the, in terms of what you call your contractor workforce, that is the vast majority of the work?---Yes, that's correct.
PN434
And these other contractors that come in from time to time to deliver bolts or service a belt or something like that they are not encompassed by what you understand to be the core CFMEU contractor definition, are they?---That's a fair description.
PN435
Yes. So again- - -?---Excepting in when we are going through a major expansion when normal activities quite frankly become less normal. Tahmoor has never in its lifetime had the number of contractors or the size of the contracts that we presently have - - -
PN436
Because of the development?---Because we are doing a $200 million expansion. So this is extraordinary times.
PN437
And there were detailed negotiations with the lodge and district officials about that expansion project were there not?---There were.
PN438
And indeed there was a range of correspondence and agreements reached between the union and the company about how it would manage the development project?---There certainly was discussion about that yes.
PN439
I am wondering Mr Commissioner if Mr Johnson could be shown a copy of Mr Fitzpatrick's statement and attachments. I have only got the one copy here?---Thank you.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN440
Mr Johnson you will see there is a statement by Mr Fitzpatrick which is yet to be sworn but I don't want to take you to the body of the statement but really to certain attachments of it?---Right.
PN441
You will see, firstly, at attachment D, do you have that?---I have.
PN442
Document titled, "23 October 02 responses to the CFMEU regarding proposals for using contractors for development in 612810 and 900 panels". Do you see that document?---Well, I've got the document in front of me. Which specific part are you referring to?
PN443
I'm just saying I'll ask you to identify the document first, do you see that?---Yes I have it.
PN444
Are you familiar with that document?---Yes, I recall this document.
PN445
Do you recall the document in which the document arose, Mr Johnson?---I could stand corrected but I understand this document was prepared by - was prepared by John Kay and I think the managing director.
PN446
But the context, correct me if I am wrong, Mr Johnson, is that it was a company response to a number of demands or concerns raised by the union concerning the major north development project; is that correct?---That's correct.
PN447
Would you accept that one of the concerns raised by the union was rosters that contractors work on the development project; do you recall that?---I can't think of a specific occasion but I have little doubt that that wasn't raised on several occasions.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN448
In your experience the mine is an issue of concern to the lodge officials, what rosters the contractors work on site, is that fair to say?---That would be fair to say yes.
PN449
And would it be true to say as well that there's been a consistent position from the union about what should apply to contractors working on your site in respect to rosters?---Reasonably consistent, yes.
PN450
And the demand has been always hasn't it that they must work one of the appendix 1 rosters?---That may well have been a demand.
PN451
Now, if I could ask you to turn to the third page of that document Mr Johnson and it's point 7 and I will quote it and ask you if you agree with my interpretation of the document but it says at point 7:
PN452
Roster patterns for contractors to be the same as Tahmoor's, 4 times 7 -
PN453
which I think refers to hours, 4 times 7 hours?---Yes.
PN454
Yes:
PN455
Monday to Friday with similar 12 hour shifts on weekends.
PN456
Now, would you accept that appears to be the demand or the request that the union has put on the company?---Yes, I accept that.
PN457
And that underneath is:
PN458
Company response. We believe that this concern is covered in our site agreement clause 32.7, contractors shall in no way be used as a precedent to change current work standards rosters.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN459
Do you see those words?---I certainly do.
PN460
Now, I think your earlier evidence about this issue, you referred to this clause earlier Mr Johnson, was to the effect that that simply means that the roster arrangements of subcontractors will not be used to change roster arrangements of your own employees, is that fair to say?---That's what I said.
PN461
Can I put this to you Mr Johnson, that the way this demand is couched is deliberately ambiguous, your response to the union demand is deliberately ambiguous?---Are you saying by the company?
PN462
Yes?---You could put it to me but I don't agree with you.
PN463
Could I put to you Mr Johnson that if you did not agree with the union's demand you would say no, no we reject that demand or something more polite and contractors should be entitled to use their own rosters provided that, and then these words follow?---In the context that this was written and discussed that we have consistently held the line, that the roster arrangements that we have within our EA are the roster arrangements of our employees and that we're not in the position, we never have, we never will in prescribing roster conditions for other people.
PN464
Mr Johnson, I put to you - - -?---And that clause, that clause there refers to our EA agreement which states those words.
PN465
THE COMMISSIONER: Well, it states the second part of those words, not the first part, the words you used because you said - - -?---Sorry your Honour.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN466
I'm having difficulty with your answer because what you said in your answer as I recollect it was words to the effect that our position is that we're not going to tell contractors what rosters they will work but we have this position in respect of our own employees and then in answer to the question you said, well that's our enterprise agreement but the enterprise agreement doesn't include that first bit, does it, that we're not going to tell contractors what hours they will work?---No it doesn't. It says, we will not use - - -
PN467
It only uses the second part of that answer?---Yes we will not use rosters worked by third parties as a precedence to change our existing roster, yes.
PN468
I understand that.
PN469
MR BUKARICA: And again the context of this to reiterate Mr Johnson was a major new development project, union concerns about the rosters and as a reassurance to the union your company response is as said here, that's correct?---Yes, well that's our response there.
PN470
Yes, it wasn't the word you used earlier?---Yes.
PN471
It's just those words that are on the document?---Yes.
PN472
I put to you Mr Johnson that the words which appear here are weasel words?---Pardon?
PN473
Weasel words, do you understand that term?---I think I do yes.
PN474
Words which are on one appearance means something but really means something else and that the purpose of these words were to make the union believe that the arrangements which were in place all along would continue to be respected by the company?---Then I would respectfully disagree with your colourful language.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN475
That's fine but can you explain to the Commission Mr Johnson why in the company response that it wouldn't be a clear rejection of the claim by the union for uniformity in business?---You need to understand that there's always an ingrown fear in employees, let's but the CFMEU aside, that conditions of employment may be changed and we regularly try to respond to those concerns and there would be numerous occasions where myself as the general manager or the chief executive of the organisation reassure in writing to employees that we have no intention of changing existing roster and indeed had we had that intention, and we're just in the middle of an enterprise agreement, we would negotiate changed conditions of rosters. We have no intention but that does not mean that we agree and we never have, that the conditions of hours of work and that will apply to other third parties. It applies to our people in our organisation in our EA.
PN476
But Mr Johnson, you've already accepted that it has applied in practice to the core contractors on the site?---Contractors obviously within the industry, contractors work a variety or rosters. On the south coast many of the contracting firms, one could say most adhere to either by the fact that it suits them or the fact that there may be pressure applied, many of the contractors actually use several rosters for the mine because it's convenient, it's convenient for transport. I'm saying to you that that may well be the case but that's not a golden rule that will be applied to every contractor. That doesn't necessarily guarantee and if you like, instil a contractor coming on with a different project must work the same as us.
PN477
So again, tell me if this is a fair summary: it's either convenience or coincident that those rosters have always been worked?---It could be advantage, it could be cost and it could be the source of their labour. The source of the labour is also very important. If the source of their labour is local, then they are more likely to work a 5-day pattern. If the source of their labour is not local, then maybe different roster arrangements may apply because of some of the travel requirements. That is rare but it is the case now because a number of our contract employees travel from Newcastle.
PN478
The reasons that there is uniformity in that way would have nothing to do with an understanding or an agreement that when in Rome do as the Romans do?---You said it, you said it may well be coincidental, it may well be coincidental.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN479
So long as we understand your evidence. I take you back to paragraph 7, Mr Johnson, I think you mentioned in your early answer that you often have to reassure employees about concerns?---Of course.
PN480
You understood what the company was doing here was reassuring the union about concerns about contractors used as a precedent, is that basically what your evidence is?---Yes.
PN481
The way the union demand is framed there, Mr Johnson, has got nothing to do with precedents, has it? There's no reference to rosters being used as a precedent there, is there?---In item 7?
PN482
In item 7?---No.
PN483
The demand is just a straight out demand that subcontractors work the same patterns?---That's their demand.
PN484
Yes?---If - yes, that's their demand.
PN485
I'm just trying to get to how it is that the company response matches or lines up against the demand that the union has put to you and which you've replicated in writing?---Well, you're suggesting to me that the demand that roster patterns for contractors be the same as Tahmoor, four by seven. If the company agreed with that response and it wanted to deal with that quickly and cleanly, it would have said, yes, we agree in full. We did not write that for the simple fact that this has been an ongoing argument over many years. We continue to refer to our enterprise agreement which says that we will not use alternate roster patterns and, you know, there may well have been an hour and a half of discussion behind those four lines. But if the company would have agreed to the CFMEU demands there, they would have said we agree in full. I've stated from outset, we do not agree.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN486
Or the converse, Mr Johnson, you could have said, "We don't agree with you"?---Look, at the discussion that preceded this, I'm sure I'm on record as saying "I do not agree, I will not agree".
PN487
Is there any documentation that you've provided the Commission about with that?---There may well be minutes. I don't have them available. I don't have them with me.
PN488
So I put to you, Mr Johnson, in the context where, at least for your 12 years or 14 years now, at the mine site, there seems to be a very large amount of uniformity, coincidental or otherwise, at the site regarding rosters, that it would have been the appropriate course for the company to make its intentions absolutely clear if it wasn't going to insist on uniform rosters and the way it would have done so would be to reject that union demand?---I put it to you that the company has rejected that demand on numerous occasions and continues to, as late as in the latest DA and our position has never changed.
PN489
Which has since the issue of Roche has emerged?---Before Roche even come on side.
PN490
Mr Johnson, the company intervenes fairly frequently in contract arrangements on site, does it not?---It can do, yes.
PN491
For example, manning issues?---It can do, yes.
PN492
Indeed the company as recently, if I can refer to appendix H in Mr Fitzpatrick's statement, I think it's the last page, an email to Mr Heywood of Roche, can you see that?---Yes, I've got it. Sorry, H?
PN493
H, yes?---From Gary Gibson?
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN494
That's right, do you see that?---Yes.
PN495
It appears to be an email directing Roche to implement a certain level of manning?---That's correct.
PN496
It's framed in words such as "I so direct", do you see the last - - -?---Yes.
PN497
Now, firstly, Mr Johnson, that would indicate that the company does enforce contractual arrangements from time to time?---Particularly where they are of a safety nature, yes.
PN498
I put to you the company does enforce, when necessary, other contractual terms on site?---Where they are of a safety nature, yes.
PN499
So other terms are not enforced, are they?---Well, I'm not sure which ones you're referring to.
PN500
For example, your insistence that district bonuses be paid as a minimum?---I mean in general as a company, as I said, we don't have a problem with that.
PN501
You don't have a problem?---Most of the contractors comply.
PN502
If they didn't comply?---If they didn't comply and they were found out to be not in alignment, then we would tell them to fix it, yes.
PN503
Shape up or ship out?---Well, we try to treat people in the right manner.
PN504
Yes, but at the very least this is indicative that far from it being anything goes with your subcontractors, there are rules?---Yes.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN505
And where necessary you will enforce those rules?---Yes.
PN506
Contractual?---Well, you're using, with respect, you're using an example that you may not have all the knowledge of what's behind the example. The particular example in this particular case was where two men were being used and were being taken to another mining face and they let the roof fall in which wasn't a good practice and therefore we advised the contractor that that wasn't a good practice and they should cease to do it.
PN507
I understand this, I'm not questioning your right or your legitimacy in doing it, I'm just trying to establish the practice of the company. Now, it's true, is it not that - - -?---We also - can I just say something?
PN508
Yes, sorry?---We have a legal obligation under certain acts to ensure the safety of not only our own employees but also the contractors employees.
PN509
Yes, under the Coal Mines Regulation Act etcetera?---Yes and that's where this one is couched.
PN510
Now, Mr Johnson, it's true, is it not, that the Tahmoor Agreement has certain minimum manning levels contained within it, that's your understanding?---I'm not aware of where they're described within the Tahmoor Agreement, no.
PN511
So you don't know, is that your answer, or do you dispute that?---No, I'm saying I can't think off the top of my head where minimum manning arrangement is prescribed within the Tahmoor EA.
PN512
I'm told it's in clause 10?---Could I be reminded of the section specifically?
PN513
Yes, now, clause 10.1 of the agreement contains words to this effect in the first 10.1, the second last sentence, "The minimum manning for coal cutting development and longwall crews will be four operators"?---I accept that.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN514
And that relates to the dispute in this particular appendix H, does it not?---I don't want to be complicated, but in a fashion it does, yes. This was a graunching crew, which is not described within that agreement with a continuous miner.
PN515
Let's focus on clause 10.1?---Yes.
PN516
I understand your point about duty of care and so on as all employees are subject to it, but that manning ratio is something which arises from an agreement between a union and the company, does it not?---That manning arranged is something that arose out of a local coal authority in 1991. It was a directive by the LCA chairman.
PN517
It's contained within the agreement though?---Yes.
PN518
You accept that?---Yes.
PN519
It would be the case that there are other manning arrangements either within the Illawarra or elsewhere which vary from this?---Of course.
PN520
Now, it's the case, is it not, Mr Johnson, that you apply this manning ratio not only to your own direct employees but to subcontractor employees as well?---Where that applies to their work, yes.
PN521
So this is another example of where there is a term in your agreement with your own employees which you apply to subcontractors on site, is that correct?---It's certainly something we apply to contractors.
PN522
There's no negotiation with subcontractors about that, is there?---Not when it's safety related, no.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN523
So in addition to bonuses, wage rates, there's also a compulsory manning requirement?---On that specific issue, yes.
PN524
On that specific issue as well?---Yes.
PN525
Is there any other issues arising from the agreement that you can think of, Mr Johnson, where you apply it directly to subcontractor employees?---Most of them are safety related or are contained within our standard operating procedures with the electrical provisions in isolation.
PN526
Wages and conditions and the like?---Well, most of those are not - the ones I just described are not in an EA because they are commonsense. They're commonsense approaches to running a complex mine. They don't need to be in an enterprise agreement.
PN527
Now, Mr Johnson, are you aware at all of the negotiations which occurred between Roche and the union prior to the company commencing on site?---I am aware there were negotiations.
PN528
Are you aware that prior to coming on site Roche put forward a radically different roster system to that which applied at the mine site at that time?---I understand they did, yes.
PN529
And are you aware through discussions with the union that Roche ultimately adopted a roster system which fell within the appendix 1 table, is that your understanding?---I understand that, yes.
PN530
So when Roche in fact started their contract on the site they adopted as did all the other core contractors the appendix 1 roster system?---I understand that is contained, that was contained within their negotiation, yes.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN531
Things went along smoothly, presumably, until your company became dissatisfied with the development metreage that Roche are producing?---In relation to rosters?
PN532
Perhaps I - I'm sorry?---You are drawing a pretty long bow there.
PN533
I've tried to save time but I should ask the question correctly. Correct me if I am wrong Mr Johnson, and I think the evidence appears as well in Mr Kay's statement that your company has been dissatisfied with the production levels achieved by Roche in respect to the development project?---That's correct.
PN534
In particular I think the words Mr Kay uses, you've started to put some considerable pressure on Roche to improve those production levels, is that correct?---That was one aspect where we applied pressure, yes.
PN535
In response to that pressure Roche have come back to you and said, one of the ways we can improve production is by increasing the roster hours, is that correct?---I don't recall Roche coming back to me saying that. We applied considerable pressure in a number of areas and that's called acceleration orders and the initial pressure we applied to Roche was for Roche to man up and to deliver the appropriate amount of equipment that was within the contract.
PN536
Would it be fair to say, Mr Johnson, that the nature of your pressure would be to say to Roche in probably much more businesslike terms than I would put it, but, we don't care how you do it provided it's legal but increase your production rate in accordance with your contract?---They have an obligation to deliver contract metreage.
PN537
One option as you say would have been to man up, increase their workforce. Another one now is to intensify the amount of time of each worker on the job?---That was, let me be very clear, that was never a request of Tahmoor Coal. The direct acceleration orders that we placed on them was to man up and to better utilise their man and also to produce on their window shift. At no time can I recall providing any directions for them to change rosters at all.
**** RAYMOND ALAN JOHNSON XXN MR BUKARICA
PN538
But in these proceedings you are saying, it might not be what we preferred but they are entitled to do it. Is that what you are saying?---No, it's a decision that Roche made. I may or may not agree with the decision but it's the decision they made.
PN539
I see, and they are entitled to do it and really what matters to us is that they reach their production levels. That's a fair summary?---Our aim was for them to reach production levels so as not to put the project in jeopardy or our employees in jeopardy.
PN540
Prior to this pressure being exerted by yourselves there hasn't been an issue has there about contractors working other than Appendix 1 rosters on the site?---Pressure was applied to Roche from the first week they arrived.
PN541
The first week they arrived, correct me if I am wrong, Mr Johnson, they were working an Appendix 1 Roster?---That's correct.
PN542
I have nothing further Commissioner.
PN543
THE COMMISSIONER: Mr Cuthbertson, have you any questions?
PN544
MR CUTHBERTSON: I don't have any questions, Commissioner.
PN545
PN546
MR KAY: Mr Johnson, in your role as general manager for Tahmoor, do you get directly involved in determining what rosters contractors will work?---No, I don't.
**** RAYMOND ALAN JOHNSON RXN MR KAY
PN547
So, do you know the details of rosters that contractors have worked over the 20 or so years that one has been operating?---I would say I might have some general knowledge but I am not specifically involved, engaged in reviewing them or understanding the detail of them.
PN548
Thank you Mr Johnson on that point. Just another point of clarification. The reference in clause 32 of the Tahmoor site agreement to the fact that contractors employees should be paid rates, the same rates as Tahmoor employees. To your knowledge is that always the case that they get exactly the same or is it possible that they actually get paid more? In other words does that determine a minimum rate or is it a same rate provision to your knowledge?---There always will be variations between the contractor payment and our employee payment because of the application of bonuses.
PN549
So it is possible, in fact, that contractors could get paid more than Tahmoor employees to your knowledge?---Quite possible.
PN550
Just turning to the document that was submitted as part of Mr Fitzpatrick's witness statement which was the document labelled D and that's the one that referred to paragraph 7, that roster pattern, that a request was made by the union that roster patterns for contractors be the same as Tahmoor. Are you with me on which paragraph I am talking about there?---I am looking at D, tab row T.
PN551
Yes, that's correct?---Is it No.7?
PN552
Paragraph No.7, that's where there is a request made that roster patterns for contractors be the same as Tahmoors and then there is a company response?---Yes, I can see that.
PN553
The request that roster patterns for contractors to be the same as Tahmoors, is it correct to say that that's very much identical to a request that was made as part of the enterprise agreement negotiation when the agreement was originally formed?---Yes.
**** RAYMOND ALAN JOHNSON RXN MR KAY
PN554
And therefore the company response which referred back to the site agreement, at least in part, reflected the fact that the matter had already been discussed as part of that enterprise agreement negotiation?---Correct.
PN555
That's all my questions, thank you, Commissioner.
PN556
THE COMMISSIONER: Thanks, Mr Johnson. If you can give back that statement to my association and you are otherwise free to go or remain as you wish?---Thank you, your Honour.
PN557
PN558
THE COMMISSIONER: Now, who was next, Mr Kay?
PN559
MR BUKARICA: If the Commission pleases, we are in the unusual position in that Mr Kay is also a witness and rather than drag these proceedings out, Commissioner, because I understand Mr Kay's evidence would be fairly much the same as Mr Johnson's, I will accept that and accept that he has been truthful and the like. I don't see any purpose in cross examination of Mr Kay unless the Commission feels a need to do so, other than record that in general the union wishes to, if we do this notionally, to make the same sort of - for the purposes of Browne and Dunn issues that I have put to Mr Kay, the same sort of suggestions that I put to Mr Johnson.
PN560
THE COMMISSIONER: I understand what you are saying. I am not sure Mr Kay does, though.
PN561
MR BUKARICA: I am content either way, Commissioner. I could ask the same questions again or it can be accepted that the union has formally put to Mr Kay the same propositions and if he rejects them or adopts the same evidence as Mr Johnson, that's fine.
PN562
THE COMMISSIONER: Mr Kay, do you understand all of that.
PN563
MR KAY: I think I understand it, Commissioner. I believe that the correct position is that if I was not to be cross examined that the union would be accepting my witness statement as read, as submitted.
PN564
PN565
THE COMMISSIONER: Mr Kay, you have prepared a statement for these proceedings, is that correct?---That's correct, Commissioner.
PN566
Have you got a copy of that statement before you?---Yes, I have.
PN567
And you've obviously seen it recently - you have seen it recently?---Yes, I have.
PN568
Do you attest that the matters contained in that statement are true and correct - - -?---Yes, I do, Commissioner.
PN569
- - - in every particular?---In every particular.
PN570
Thank you. Is there anything further you wish to add to that statement?---No, Commissioner.
PN571
PN572
THE COMMISSIONER: I think probably for the record I should get your name and address as well because it wouldn't have shown up?---Yes. My full name is John Stuart Kay - S-t-u-a-r-t - and my address is Remembrance Drive, Tahmoor.
PN573
PN574
MR BUKARICA: Mr Kay, you were in the courtroom when Mr Johnson gave evidence, is that correct?---That's correct.
PN575
Do you recall that I took Mr Johnson to your witness statement, I think in some detail?---That's correct.
PN576
Just confirm for me, Mr Kay, on the first page of your witness statement there is numbering 1 to 4 and then on the second page there seems to be, at least on my copy an error where the numbering recommences. Is that the same with yours?---Yes, that's correct, the number 2 follows from number 4, so that should continue as paragraph number 5.
PN577
Do you recall I referred Mr Johnson to the second paragraph of the second number 2. Do you follow?---That's correct.
PN578
And to the statement:
PN579
I am also aware that most contractors today have their own agreements with their employees and those agreements will usually have provisions covering rosters and these provisions potentially provide for different roster arrangements than apply at Tahmoor.
PN580
Do you see those words?---Yes, that's correct.
PN581
Are there any core contractors at the Tahmoor mine, other than Roche, who apply a rostering arrangement other than that contained in appendix 1 of your Tahmoor agreement?---I don't have detailed knowledge of the rosters that are worked by contractors at Tahmoor, so I can't confirm or not confirm that.
PN582
I see. Mr Kay, you're the Human Resources Manager, is that correct?---That's correct.
**** JOHN STUART KAY XXN MR BUKARICA
PN583
If there was anybody in the company who would know that information, would it be fair to say that you'd be the person?---No, that's not correct.
PN584
Not correct. Who would have that information?---The direct liaison with the corrector is normally by the superintendent who was in charge of the work, and he would have detailed knowledge of the actual working arrangements of that contractor. My role, I should say, is the enforcement of the agreement, and given that the agreement does not directly prescribe rosters, I don't get involved in that subject.
PN585
Mr Kay, you've read the statement of Mr Fitzpatrick in these proceedings?---That's correct.
PN586
Mr Fitzpatrick makes the assertion that to his knowledge all core contractors on the mine site up until the current situation with Roche have worked the appendix 1 rosters. Are you in any position to dispute that assertion?---No, I'm not.
PN587
In your experience are you able to say whether you would regard that as correct or incorrect?---I'm neither able to say it's correct or incorrect. Mr Fitzpatrick has a longer association with Tahmoor and probably gets more involved with those issues than I do, so it's most likely that he is correct.
PN588
Therefore the position is, is it not, that for the life of the mine, or at least for some considerable time, there has been a significant amount of uniformity between the rosters applying to your direct employees and those applying to core contractors on site?---Well, as I say, I would not know about that. I don't have direct knowledge of that.
PN589
Your evidence is that you would accept Mr Fitzpatrick's suggestion about that?---I've no reason to dispute anything Mr Fitzpatrick says, certainly not on this point. I have no reason to dispute that, but I have no direct knowledge of that.
**** JOHN STUART KAY XXN MR BUKARICA
PN590
Are you able to posit a reason why there would be such uniformity between the head contractors' employees' rosters and those of subcontractors?---Well, I would agree, I do recall the evidence given by Mr Johnson, and I think he answered that point. I think that on the south coast there has not generally been a lot of variation in the rosters that employees have worked. They have tendered to work either seven or eight hour rosters over recent times, although that is starting to change now. So it's not surprising that contractors coming to work at Tahmoor would work either seven or eight hours rosters. That wouldn't surprise me at all. Similarly, I am aware that there is an expectation on the part of the union movement that those sorts of rosters are worked and that contractors try to conform with expectations of all parties when they come on-site. And they don't - they don't want to come on-site and have trouble, they want to come on-site and have a successful contract. So it may well be that contractors have conformed with expectations that haven't necessarily been supported by an agreement, or an obligation imposed by the company.
PN591
I see, so you say, do you Mr Kay, that it might be because the company is afraid of the union that they simply adopt those rosters?---No, I would not use those words and I'm only speculating, but I think my words would be that contractors, yes, do try and come on site and gain the co-operation of all parties. When contractors come on site, and we are talking about core contractors here, their employees are typically members of the CFMEU and it doesn't surprise me at all that they would try and have a good relationship with the CFMEU and if that means conforming with expectations about rosters it would not surprise me that they do conform.
PN592
Now, Mr Kay, you heard the evidence of Mr Johnson earlier to the effect that the company - well firstly, enforces a minimum district bonus to most contractors - - -?---That's correct. That's correct.
PN593
You are aware of that?---Yes.
PN594
The company enforces minimum pay rates amongst contractors?---That's correct.
**** JOHN STUART KAY XXN MR BUKARICA
PN595
The company also enforces minimum manning levels?---No I didn't hear Mr Johnson say that. I did hear that there was a specific instance where we were concerned about safe work and that did involve a manning issue but I'm not aware that generally speaking we enforce manning issues.
PN596
So you are referring to appendix H of Mr Fitzpatrick's statement, the email from Gary Gibson?---I thought that was the one you were referring to.
PN597
Yes?---And that Mr Johnson was referring to.
PN598
Yes, and that email was in response to a representative of Roche, asserting that they did not have to comply with the minimum manning level in the Tahmoor agreement. Is that correct?---I don't have it in front of me.
PN599
Yes?---But - - -
PN600
Do you want to see it?---Yes please.
PN601
So Mr Kay, you see the memorandum - could I ask you firstly have you seen this email prior to these proceedings?---Yes I have.
PN602
And are you aware of the context of why the email was issued?---Not the detail. I was more aware at the time that it was issued but in general terms, yes I am aware of why it was issued.
PN603
Yes. Could I put to you Mr Kay that the reason the email was issued was Mr Hayward from Roche, asserted to Tahmoor that the manning levels in the Tahmoor agreement did not apply to Roche. Is that your recollection of the rationale?---No I don't recall that but I'm not denying that that was the case. I don't recall that.
**** JOHN STUART KAY XXN MR BUKARICA
PN604
Yes. Do you recall the evidence concerning clause 10.1 of the Tahmoor agreement, the minimum manning levels?---Yes, as far as minimum manning levels for coal cutting.
PN605
And that is in fact, although there was some distinction drawn about the particular process, that in fact was what occurred here wasn't it, that the manning levels in that agreement were enforced on Roche?---No that's not correct. The manning - there have been discussions on site about what that 10.1 means and it has certainly been a point of contention as to whether that provision applies to grunching and it has been the consistent company position that that provision does not apply to grunching. What we were talking about here was something that is quite separate from the agreement in our view and was determined by what the mine Manager, in this instance, because this was an issue discussed with the mine Manager, what the mine Manager felt was necessary for safe operations.
PN606
Putting aside the particular process there, I understand you are saying there is an issue about grunching?---That's correct.
PN607
What about the operation of underground minor? In relation to the operation of underground minor, there is a minimum manning level of four, is there not?---There is a minimum manning level of four that is prescribed in the Tahmoor Agreement.
PN608
That applies both to your direct employees and to subcontractors, is that correct?---It doesn't apply to subcontractors. I would be concerned for the same reasons that that was originally determined for Tahmoor if somebody endeavoured to operate with something less.
PN609
Let me put this proposition to you, Mr Kay: if Roche tomorrow wanted to operate an underground minor with less than four workers, what would be Tahmoor's response?---We'd be concerned about that on a number of fronts.
**** JOHN STUART KAY XXN MR BUKARICA
PN610
You would indeed, direct them to man up, would you not?---I wouldn't necessarily say that, I would say that we would be concerned about it, we would have an issue to address, we would have an industrial issue to address which is one of our first problems and we may well consider that it poses a safety issue, depending on the circumstances but we would certainly have an industrial issue to address.
PN611
You are not telling us are you, Mr Kay that if Roche dug their feet in about the issue, you wouldn't direct them to do as you are told or - - -?---You are talking about a hypothetical situation here and I'm saying that we would address that at the time and there would be a number of factors that we would have to consider but I wouldn't necessarily say that our particular agreement with regard to that manning does apply to Roche.
PN612
What are you saying, Mr Kay that if Roche tried to operate with a lesser manning level than that prescribed in the agreement, you would simply allow them to do that?---No, I don't think I said that at all, I said that if they came with that proposal and we're talking about a big if, then we would have issues to address, we would have industrial issues to address because our employees would not like that, they would oppose that and we would have that issue and we would potentially have a safety issue, depending on the total circumstances as to how they were going to do that.
PN613
I put it to you that you would direct them to man up to four?---I'm putting to you that this is a hypothetical answer and I don't know the answer as to how we would respond to it in precise terms and I do agree we would have an issue to resolve.
PN614
Do you have Mr Fitzpatrick's statement before you?---Yes, I do.
PN615
I take you to appendix D which I think also, Mr Johnson also was taken to, do you have that?---Yes, I've got - - -
**** JOHN STUART KAY XXN MR BUKARICA
PN616
Are you familiar with that document?---Yes, I am, I wrote it.
PN617
The context of it was negotiations concerning the North Development Project, Tahmoor North Development Project?---Yes.
PN618
Correct me if I'm wrong, the way this is worded is, there are a number of union concerns or demands made and the company was responding to each of those seriatim?---Yes, that's correct.
PN619
If we go to paragraph 7 numbered 7, you were here when I cross-examined Mr Johnson about what was meant by the company, both the union claim as set out and the company's response, do you recall that evidence?---Yes, I do, yes.
PN620
Do you recall that I put to Mr Johnson that the company was being deliberately ambiguous or misleading in terms of its response to the union?---Yes, I do recall that.
PN621
What do you say to that?---I disagree with that.
PN622
I also put to Mr Johnson the proposition that had the company rejected the union's claim, it would have said so in clear terms?---I believe it is in clear terms.
PN623
THE COMMISSIONER: Sorry, I can't hear you?---Sorry, I believe that the response is clear.
PN624
MR BUKARICA: So where the union says, roster patterns for contractors are to be the same as Tahmoor's, 4 times 7 Monday to Friday with similar 12-hour shifts on week-ends, then the company responds, "We believe that this concern is covered in our site agreement, clause 32.7:
**** JOHN STUART KAY XXN MR BUKARICA
PN625
Contractors shall in no way be used as a precedent to change to current work standards rosters.
PN626
Fully answers that union claim?---Yes because as Mr Johnson said, we have a few words here which try to summarise a matter that was discussed as some length. Now, it was discussed at some length in exactly the same way that it was discussed at some length when we undertook the Enterprise Agreement negotiation. In both instances in response to the suggestion that roster patterns for contractors to be the same as Tahmoor's we did discuss the underlying concern that the union had behind their request and that's why this reference here is to that the concern is covered in our site agreement. Now, the underlying concern was that the Enterprise Agreement negotiation and when this was discussed, that Tahmoor would use anything different that was being done by the contractor as a precedent and therefore, that's the reference to the concern, the concern is covered in the Site Agreement by that 32.7.
PN627
Mr Kay, why didn't you in answering this claim say for example, words to the effect of: we do not accept that we can regulate contractor rosters but we are prepared to do and then say what you say underneath?---I believe we did say that, it's correct that those words aren't specifically in the written document but I believe that those words were said and certainly, in my view they are implied in those words reasonably clearly, you say ambiguously, I say clearly.
PN628
Mr Kay, why would Mr Fitzpatrick and presumably, other union representatives be under the impression that there was an agreement concerning rosters on the site?---I think it's true that the union have always believed that contractors coming on site should work the same rosters, they've always believed that that should be the case and their views stem from that belief. It is not our believe but nevertheless, it has been their's, it has been a difference between the parties over a number of years and certainly, a difference that surfaced in the Enterprise Agreement when this was negotiated.
**** JOHN STUART KAY XXN MR BUKARICA
PN629
So the custom and practice has been, I think you are prepared to accept, that almost, well, until very recently exclusively, contractors have used one of the Appendix 1 rosters?---No, it's Mr Fitzpatrick's evidence that that's the case and I've got no reason to dispute his evidence. I think subtle variations, I have experience of subtle variations that have taken place but I don't get directly involved, I am aware of subtle variations that arise because of particular circumstances of contractors and if you are looking an example of that, I am aware of a contractor who is on site at the moment who allows because his employees come from the Hunter Valley, who allows his employees to go home early on the Friday in order to travel home. So it's a subtle variation but it is an attempt to try and respond to their particular circumstances.
PN630
But you would understand, would you not, Mr Kay that going into negotiations with the company, it would reasonable for the union to say, well, these are the arrangements which have always been in place in relation to rosters, now, unless the company tells us now that there is something different, then those arrangements will continue to apply?---When we did the negotiation for the agreement and this is exactly the discussion that was had, that's exactly the response that was given, the union wanted to enforce something that they believed had been in place in practice or in custom which was that roster patterns would be the same for contractors, they wanted to enforce that in the agreement and the company declined to do that. That is very clear, the company declined to write those words into the agreement because we did not want those words in the agreement. Had we wanted those words in the agreement, that's what we would written. So we didn't want those words in the agreement and that's why the agreement is what it is today.
PN631
Mr Kay, is there any document that you can point us to which is before the Commission that states that the company rejects the proposition regarding rosters that the union advances?---I believe paragraph 7 that we have in front of us does.
PN632
I put to you, the same as I did Mr Johnson, that the words appearing in the company response in paragraph 7 are misleading or to use a vernacular, weasel words where you have maybe intended one meaning but it's different to that which the union representatives could legitimately understood?---I disagree with that.
**** JOHN STUART KAY XXN MR BUKARICA
PN633
I put to you as well, Mr Kay, that there has been a long-standing custom and practice and agreement between the union party and Tahmoor to the effect that with contractors "when in Rome do as the Romans do"?---I definitely disagree with that. There never has been an agreement along those lines.
PN634
I put to you that it applies bonuses, pay rates, manning levels and, indeed, rosters?---It applies to - it doesn't apply to any of those things in detail. As far as bonus is concerned the reference is to district average bonus which is something which employees at Tahmoor don't have; they don't have the district average bonus so that's a clear example. It's not "when in Rome", it's a special provision that applies to contractors. As far as the rates of pay are concerned the agreement and precedent has always been that the Tahmoor rates operate as a minimum. It has always been perfectly possible that a contractor has paid higher rates by agreement with his own employees and as far as rosters is concerned it has always been possible that a contractor would come up with an alternative roster pattern than as worked in Rome. Whether or not that has been the case in practice I don't know but it's always been possible.
PN635
Mr Kay, there's no evidence that you've produced or Tahmoor has produced that the roster patterns have been anything other than what Mr Fitzpatrick puts in relation to contractors?---No. However, that hasn't been our contention. I mean it has been the contention of the union witnesses that that has been the case and likewise I would suggest there's been no evidence submitted that they have been the same.
PN636
Perhaps we can wait until Mr Fitzpatrick has been sworn up but Mr Fitzpatrick has been on site for 17 or 18 years; is that right?---Yes, that's correct, yes, and I've already said that I have no reason to dispute anything Mr Fitzpatrick has said but over and above Mr Fitzpatrick's witness statement I'm not aware of any evidence having been submitted that that's the case.
PN637
Mr Kay, Mr Fitzpatrick's statement was served on the company about 9 December; is that correct?---That's correct.
**** JOHN STUART KAY XXN MR BUKARICA
PN638
Give or take a day or so. Did the company as a result of Mr Fitzpatrick's statement seek to clarify or verify the statement he makes about rosters applying to contractors in the way that I've described?---It's not - we're talking here about a major exercise to try and confirm that point. A large number of contractors have worked on Tahmoor and its history and it would simply have been impractical to have tried to obtain evidence as to exactly what rosters all of those contractors worked. Our records don't go as far as specifying rosters contractors work and it would simply have been an impossible task to have tried to verify that and no effort was - I won't say no effort was made but we did not verify whether that was the case or not and it's also been our view that if that - even if we proved the case that that was the case it wouldn't necessarily be an argument that that has to be the case in the future anyway.
PN639
I see, but the answer to the question is, no, you haven't?---No.
PN640
Nothing further, Commissioner.
PN641
THE COMMISSIONER: I think that last question probably - I had a question and I'll reserve your rights - covered it. The company knew that that issue was in dispute didn't it?---That's correct.
PN642
From the time they received the statement?---Yes.
PN643
Is it reasonable for me to infer that if there wasn't alternate evidence available it would have been sought by the company?---That's correct, Commissioner.
PN644
And the company didn't seek it?---The view that the evidence is not available?
PN645
Yes?---Otherwise, yes, we would have sought that evidence.
**** JOHN STUART KAY XXN MR BUKARICA
PN646
So it's open to me to infer then that there is no available evidence of a different sort of practice being adopted?---Well, in general terms, we don't keep records of all of the rosters that are worked by contractors.
PN647
I understand that but is it open to me to infer that there is no evidence available of alternative rosters being worked?---Yes, that's correct.
PN648
Thank you. Does that lead you to anything?
PN649
MR BUKARICA: If the Commission pleases that covers my last point.
PN650
THE COMMISSIONER: I am sorry, Mr Cuthbertson, did you have any questions?
PN651
MR CUTHBERTSON: That answers probably one of the questions that I had.
PN652
THE COMMISSIONER: Mr Kay, I have got to give you the opportunity to say anything whilst in the witness box that might clarify your position on any of the matters that were raised in cross-examination?---No, I don't believe I need to do that, thank you, Commissioner.
PN653
Thank you. I think that's how I protect your right of re-examination.
PN654
PN655
PN656
MR CUTHBERTSON: Thanks, Mr Duncan. Firstly, have you prepared a statement for today's proceedings?---Yes, I have.
PN657
Have you got a copy of that document in front of you?---Yes, I have.
PN658
Is there any alterations, changes or additions you wish to make at this particular point in time?---No, there's none.
PN659
THE COMMISSIONER: Apart from the correction to your name in the heading?---Sorry?
PN660
Apart from the correction to your name in the heading, at least on mine, The Witness Statement of Greg Ducan?---The statement I have says Duncan.
PN661
The one that was faxed to us was - - -
PN662
MR BUKARICA: Mine is the same, Mr Commissioner.
PN663
THE COMMISSIONER: Sorry, it is "Duncan"?---Yes.
PN664
MR CUTHBERTSON: For the record can you correct your name?
PN665
THE COMMISSIONER: No, it might be best if - it is the same in all of them is it?
PN666
MR CUTHBERTSON: Apologies, Commissioner. In the heading Witness Statement of Greg Duncan in the first sentence thereafter it does state Greg Duncan in full.
**** GREG ROBERTSON DUNCAN XN MR CUTHBERTSON
PN667
THE COMMISSIONER: Yes, I know that but the heading is the correction. Do you see that, Mr Duncan? Sorry.
PN668
MR CUTHBERTSON: Mr Duncan, I can refer you to the heading in bold Witness Statement of Greg Duncan under the C number it does actually state Greg Ducan?---Correct, it's Greg Duncan.
PN669
THE COMMISSIONER: Yes. It's a minor matter.
PN670
MR CUTHBERTSON: Can you confirm to the Commission that that's a true and correct statement?---That is a correct statement.
PN671
I have nothing further at this stage, Commissioner.
PN672
PN673
MR BUKARICA: If the Commission pleases.
PN674
Mr Duncan, you were in the courtroom were you not during the evidence of Mr Kay and Mr Johnson? Were you here during that evidence?---I'm sorry? You will have to speak up a bit, I am a little hard of hearing.
PN675
Sorry. Were you in the courtroom during the evidence of Mr Johnson and Mr Kay?---Yes, I was.
**** GREG ROBERTSON DUNCAN XXN MR BUKARICA
PN676
Can I take you to paragraph 5 of your statement?---Yes.
PN677
In paragraph 5 you discuss the process of negotiating a roster arrangement with the CFMEU; do you recall that?--- Yes, we did.
PN678
Is it the case that when you first came to the Tahmoor minesite you had a fairly different proposal for the rosters; is that right?---That's right.
PN679
And that was eventually agreed?---Yes.
PN680
They were rotating shifts of 10 hours?---That's correct, yes.
PN681
As a result of discussions with the union you implemented an 8 hour times 5 roster?---Yes, that's correct.
PN682
Along with the weekend 12 hour facility?---That's correct.
PN683
That agreement was reached prior to your certified agreement being finalised was it not?---That's correct.
PN684
Some two or three months prior; is that right?---That's not correct.
PN685
How long was it done?---That was reached in the month of December.
PN686
And the agreement was in January; is that correct?---That's right.
PN687
In any case, the agreement was you would work 5 x 8 plus the week end 12s?---Correct.
**** GREG ROBERTSON DUNCAN XXN MR BUKARICA
PN688
And that's a roster arrangement which appears under Appendix 1 of the Tahmoor agreement, is it not?---That's correct.
PN689
Generally, Mr Duncan, do you understand what I mean by the terms, When in Rome do as the Romans do?---Only when I'm in Rome.
PN690
Categorising beautiful Tahmoor as Rome for the purpose of the present argument, would it be true to say that the meaning of that saying is when contractors come on to the Tahmoor minesite you do what's expected of you?---That may be the understanding from the union's perspective but it's not the understanding from Roche.
PN691
I see. What was the reason that you adopted the 5 x 8 roster, Mr Duncan?---Right. When we first proposed the roster for the Tahmoor, it was a different roster from what was currently worked there, it was two 10 hour construction shifts rotating over seven days and a maintenance shift on the night shift Monday to Friday. That was our preferred roster Tahmoor tendering, that's what we tendered on and that's what we started out negotiating. During the course of those negotiations Mr White from the district office of the CFMEU, a number of impediments were highlighted by Mr White. First of all he wanted in place a preferred southern districts pro forma type contractors roster. We were not interested in negotiating anything around that type of roster - sorry agreement - we only wanted our own certified agreement. He indicated to us that there would be issues in terms of shift length and the main issue from his perspective was the rotation rather than fixed shift arrangements. At that point in time we were supposed to commence work on site just prior to the Australia Day long week end and we are contractually. In the interests of trying to get the agreement in place as expediently as possible we said we would be prepared to give the eight hour shifts, Monday to Friday, a go and work the week end on a 12 hour shift basis.
PN692
Indeed, you reached an agreement to work the eight hour shifts?---That's correct.
**** GREG ROBERTSON DUNCAN XXN MR BUKARICA
PN693
At that time did you indicate anything other than that would be what you would work on the site?---No, we did not indicate they would do anything else other than those at that point in time.
PN694
So Mr White would be entitled would he not to be working on the assumption that the five times eight would be the roster arrangement for your guys on the Tahmoor site?---That's correct.
PN695
That was the context in which the Roche agreement was reached, was it not?---That's correct.
PN696
Indeed, in your witness statement you make the comment that at the time the agreement was reached on rosters there was no immediate prospect at least of any change?---At the time of agreement on rosters, no, there was no intention to change at that point in time.
PN697
So in signing off on the agreement, the certified agreement, the position was there was an agreement between Roche and the union that the rosters to be worked on the job would be five times eight?---That's correct.
PN698
That was the position really wasn't it, Mr Duncan, until Tahmoor started putting pressure on your company concerning metreage levels?---The superintendent for the contract gave us an instruction that we had to use whatever resources and obtain whatever resources necessary to overcome any shortfalls that occurred at that point in time under the contract. He did not specify exactly how that was to happen.
PN699
I think I used layman terms and said in examination of Mr Johnson words to the effect of, we don't care how you do it so long as it's legal, just do it, reach those production levels. Is that the- - -?---Well, the requirement was that we were given an acceleration order. It was up to us to do whatever was necessary to reach that acceleration order.
**** GREG ROBERTSON DUNCAN XXN MR BUKARICA
PN700
So going back one step, the answer to the question is the imperative for you to change your roster arrangements was at direction from Tahmoor?---No, that's not correct.
PN701
I see. It had nothing to do with it?---From memory the acceleration order was given to us around about April of last year. We did not move or even look at considering changes to the rosters until probably June. I think it was towards the end of June when I approached the union and first mentioned that we were looking at changing the rosters and the reasons why.
PN702
And the reasons were that significant pressure was being applied to you as a contractor to increase your production levels?---The reasons were, I explained this to the Tahmoor union officials, we needed to improve the amount of available production time and reduce the amount of date time. In doing that we needed to change the roster.
PN703
Nothing further, Commissioner.
PN704
THE COMMISSIONER: Mr Kay, any questions?
PN705
PN706
MR CUTHBERTSON: Mr Duncan, what's your understanding of what governs the terms and conditions of working relation to employees at Tahmoor?---It's the Roche Tahmoor Certified Agreement.
PN707
In your recollection, I can show you a copy of the document itself but in particular, the hours of work clause 4.1, is that provision reflective of what was agreed in your discussions with Mr White?---That's correct.
**** GREG ROBERTSON DUNCAN RXN MR CUTHBERTSON
PN708
I have nothing further, Commissioner.
PN709
THE COMMISSIONER: That might have headed off into some new territory, I am not sure. It is a matter for you.
PN710
MR BUKARICA: I am not quite sure if I heard the last exchange.
PN711
THE COMMISSIONER: As I understood it it related to the negotiations for the agreement and that was certainly raised but then the specific agreement and the specific clause in the agreement, whether or not it was the result of - it's clause 4.1 was it, Mr Cuthbertson.
PN712
MR CUTHBERTSON: That's correct.
PN713
THE COMMISSIONER: Clause 4.1 was the agreement struck with Mr White. and the response was, yes.
PN714
MR BUKARICA: I accept that clause 4.1 appears in the Roche agreement and that Mr White was involved in the negotiating it.
PN715
PN716
MR BUKARICA: Before we move to Mr Fitzpatrick's evidence, there is the issue of Mr Newman's statement, in the same way as Mr White's statement is not to be formally - - -
PN717
THE COMMISSIONER: There is also Mr Hayward.
PN718
MR BUKARICA: Mr Hayward is in the courtroom and I don't seek to cross examine him so his statement is unchallenged. It is just Mr Newman's statement should be removed.
PN719
THE COMMISSIONER: Yes, that has been done. So, Mr Cuthbertson, it remains for you simply - you ask me to exhibit Mr Hayward's statement.
PN720
MR CUTHBERTSON: Could we have marked as an exhibit the statement prepared by Mr John Hayward.
PN721
PN722
MR BUKARICA: I notice the time. Do you need a break?
PN723
THE COMMISSIONER: No, keep going. I usually only want a break because the witness has been in the box too long.
PN724
PN725
MR BUKARICA: Mr Fitzpatrick, did you prepare a witness statement in these proceedings dated 9 December 2003?---Yes I did.
PN726
And do you have a copy of that in front of you?---No.
PN727
I beg your pardon again, Commissioner, I've only got the one copy.
PN728
THE COMMISSIONER: If he needs it however we're going to be in trouble.
PN729
MR BUKARICA: Now, the witness statement itself is about seven pages duration and there are a number of attachments going from the letter A to the letter H, is that correct?---Yes.
PN730
You adopt and are familiar with all the attachments?---Yes.
PN731
And in respect to the statement itself is there anything you wish to amend or change?---No.
PN732
Do you say that to the best of your knowledge and belief that the statement is true and correct in every particular?---Yes I do.
PN733
Nothing further, Commissioner.
PN734
**** KEVIN AUBREY FITZPATRICK XN MR BUKARICA
PN735
MR BUKARICA: If the Commission pleases I have no questions.
PN736
PN737
MR KAY: Mr Fitzpatrick, you have provided a statement, I will find the paragraph in a minute, but basically says that all core contractors or contractors that have come on site at Tahmoor to undertake core mining activities have worked the same rosters at Tahmoor employees, is that correct?---To the best of my knowledge, yes.
PN738
Have you been able to provide or can you provide any actual evidence that that is the case other than your own recollection?---No, I'm not, I don't recall, I more raise an issue if someone is outside, so if I haven't recalled an issue about that I'd say it hasn't happened.
PN739
The clause 32 in the Tahmoor agreement provides that contracts should pay the same wages as a minimum and the district average bonus to contracts coming on site, has there ever been a disagreement with the company over this particular point to your recollection?---To my recollection no.
PN740
So basically the company had never tried to dispute that that was the case?---No.
PN741
However, you agree and there's evidence by this hearing today that the company had disputed the contention that all contractors should work the same rosters as Tahmoor employees?---When this business with Roche was originally brought up was when we believed that you had a problem with it, we believed that it hadn't been a problem with Austral before that time.
**** KEVIN AUBREY FITZPATRICK XXN MR KAY
PN742
Do you have an explanation for why the wording in clause 32 deals with rosters separately from the provision that deals with wages and bonuses and that the actual wording is quite different and refers to, uses the word precedence for example, do you have an explanation for why that is different?---I do, that clause had not appeared in earlier certified agreements between ourselves and Austral I believe and that was due to the increasing numbers of contractors for the Tahmoor North Project Agreement and I believed it was to answer our concerns about our standards and about the rosters that prevail at Tahmoor. I believe that incoming contractors were not to, their needs were not to be used as a precedent to change the rosters and they would indeed follow our rosters and our standards because both of those items are in the same clause, 32.7.
PN743
So you refer to both standards and rosters together but not the wages and the district bonus which is a separate provision?---They were items that had been in there longstanding, we believe these needed special attention.
PN744
That's all my questions, thank you, Commissioner.
PN745
THE COMMISSIONER: Mr Cuthbertson?
PN746
PN747
MR CUTHBERTSON: Mr Fitzpatrick, you're aware of a document called the Tahmoor Mine Site Agreement 2001?---Yes.
PN748
I gather you were directly involved in negotiating that agreement?---Yes.
PN749
In particular clause 32 that you've made reference to and some of the other witnesses today regarding contractor provisions?---Sorry, I didn't get that bit, sorry.
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN750
In particular you had direct involvement in negotiating clause 32, the contractors clause within that agreement?---Yes, the whole agreement.
PN751
32.1.2 of that particular clause clearly states and I will read for the Commission's purposes:
PN752
All contractors who perform main core CFMEU functions we pay the same base rate as a permanent workforce. Contractor employees employed on this work will be paid an ex gratia payment equivalent to the district average bonus for the period worked unless otherwise agreed.
PN753
Would you agree that with respect to wages and bonuses it's pretty obvious by the words there as to what core contractors, if we can excuse the definition of core contractors for a moment, we can just assume for the purpose of the exercise that it's pretty clear that in relation to core contractors as to what wages has a bare minimum, that is base rates, and bonuses shall be paid by those contractors?---Yes I acknowledge that.
PN754
Can you point out in that clause where it says that core contractors shall work the same rosters as Tahmoor employees or employees covered by this particular agreement?---Yes I believe it does in 32.7, the whole contractors part refers to core contractors that we have coverage over and that are covered by this agreement, that's more core contractors and the whole clause then covers those people, go on.
PN755
I was going to say let's be clear, 32.7 states fairly clearly that contractors shall in no way be used as a precedent to change current work standards, that's different wouldn't you agree from putting a simple sentence in the contract clause which simply says that all core contractors will work the same rosters or rosters as found within appendix 1?---I believe this contractors clause which is 32 of our certified agreement covers core contractors.
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN756
Well, I put it to you 32.7 is completely different to a statement that would require core contractors or require the parties bound by that particular document to enforce the situation where core contractors would work the same rosters?---I put it to you that not all contractors are core contractors but the word "contractors" covers the field.
PN757
Mr Fitzpatrick, were any Roche representatives involved in negotiating the Tahmoor Mine Site Agreement?---No.
PN758
Likewise were you involved directly in negotiating the agreement titled, The Roche Mining Tahmoor Development Certified Agreement 2002?---Funnily enough you were.
PN759
You were?---In the very later stages Mark.
PN760
And what was your knowledge of those discussions, in particular was any affirmations or statements made by Roche representatives that they would work rosters or agree to apply the Tahmoor Mine Site Agreement 2001?---Yes, we came to agreement on the rosters, to put a fine point on it I looked at a very late draft of a certified agreement draft and picked up some different points on it where we with discussions with Graham White the district representative and Roche people, Peter Newman and I'm not sure whether Greg was there and Peter Cross discussed the finer points on the district average bonus and the weekend twelve hour arrangements which are now agreed. They had been put into a part-time clause of your draft, there was a clause in there that said, part-time employees and Saturday/Sunday employees which referred to our weekend arrangements and I had that changed that it now refers to a document dated 3 January 2002, that's the payment arrangements for our weekend arrangements which Roche then adopted without a problem so, yes, I did have some input as did the rest of the Tahmoor executive into the latter stages.
PN761
I think what you are referring to is clause 2.1 subsection (g) of the rights certified agreement?---I haven't got that with me Mark.
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN762
I'll read, just for your information, it states and the title is, "Saturday/Sunday employees", it goes on to say:
PN763
As Saturday/Sunday employees ..... engaged by the week to work regular hours less than an average of 35 hours per week. The terms of the Tahmoor 3 January 2002 payments, arrangements and conditions applying shall apply to Saturday/Sunday employees.
PN764
It says that:
PN765
As a result of discussions that you took part in it was agreed by Roche to insert those provisions within the document.
PN766
?---I don't believe it was ever the intent clearly to go against that but that just cleared the point up that that's the document, 3 January 2002 that contains the payment arrangements for that roster.
PN767
So it is fair to say that where agreement was reached on other documents, if you like, that were to be referred to or adhered to by Roche, they were clearly spelt out within the Roche certified agreement?---I didn't get that Mark, sorry.
PN768
I'll say it, perhaps again, that where there was agreement between Roche and the CFMEU, that there were other documents to adhere to eg the payment arrangements for Saturday/Sunday employees. Then the parties directly inserted wording to that effect in the Roche certified agreement?---Well, as not being a signatory, Mark, I report or aid Mr Graham White in those issues. He did get - it is clear that the bonus issue is not clearly written in your Roche agreement but we were very clear in the end that district bonus was going to be paid on a weekly basis. Your draft - your final document does not say that very clearly, so the words - - -
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN769
That's in relation to timing of payment?--- - - - the words were never quite tidied up in some things.
PN770
That's in relation to timing of payment but surely the issue of quantum is clearly spelt out within the Roche agreement. I can read out clause 3.8.
PN771
MR BUKARICA: Commissioner I - - -
PN772
THE COMMISSIONER: It should really be framed as a question. I know it is - - -
PN773
MR BUKARICA: Yes.
PN774
THE COMMISSIONER: You can put a proposition and ask Mr Fitzpatrick to agree or disagree but it should be framed as a question.
PN775
MR CUTHBERTSON: Well, perhaps he has answered my initial proposition in any event.
PN776
THE COMMISSIONER: Then you need to say that to the witness and put the proposition to him again and keep it going in that way otherwise - - -
PN777
MR CUTHBERTSON: I'll re-phrase it. The proposition to you Mr Fitzpatrick is that where Roche, who is a party to the Roche certified agreement, agreed to adhere to certain conditions that would apply to its employees then they were clearly spelt out within the Roche certified agreement and I gave the example before that, in particular, your involvement relating to the Saturday/Sunday employees and that wages and conditions were found within a different document which was similar to that that was applied to employees of Tahmoor, that in those sorts of circumstances, the parties
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
specifically wrote those provisions, or referred to those provisions within the Roche agreement?---Well, I don't accept that for all issues, contentious issues, were settled in black and white, Mark. No, I don't accept that and I give the example of ours, the rosters that we believe we agreed to with Roche and the district average bonus as per our certified agreement. Those two things were never cleared up in black and white.
PN778
Are you aware of the "hours of work" clause in the Roche agreement, clause 4.1?---I am.
PN779
Are you also aware that the submissions of the CFMEU at least in their outline of submissions have been that the interpretation given by Roche to clause 4.1, if you look at that clause in isolation, it is correct?---Mark, when I say I know it, I've read it numerous times, but I haven't got it in front of me.
PN780
Well, I guess the only final question that I have would be that, "If agreement was, in your view, reached as to the eight hour shift rosters that were to be implemented by Roche, why would then you not have a similar scenario where you have an appendix placed at the rear of the document and have simple wording to the effect that any other rosters that would be required to be worked by the company, need to be - agree with the workforce and/or the CFMEU. Why do we have a distinct difference in the wording in clause 4.1?---I believe we were given the undertaking that you, that Roche would comply with their rosters, and not being a signatory to it, I don't have to read it and bring it here to certify, Mark. You are asking the wrong person.
PN781
Who was the undertaking made by, specifically?---That one was delivered to us by an Austral management representative regarding the roster - - -
PN782
So not by Roche, not by a Roche employee?---No, hang on, that was delivered by an Austral management person for the rosters and the one for the district bonus would have been delivered by Peter Newman or, Peter Cross was his name.
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN783
Yes correct. The hotel Manager?---Who was at - in attendance at a meeting on 30, 31 December 2001 I think.
PN784
I don't have anything further, Commissioner.
PN785
THE COMMISSIONER: I've got a question and I'll reserve your rights. I don't understand what you say about the district average, or the average district, sorry the district average bonus not being tied down. The words of clause 3.8 are these:
PN786
Roche will implement a productivity sharing scheme. Employees will be able to participate in and benefit from the productivity operation. It is the intention that the value of the productivity bonus will equal the district average bonus.
PN787
Now, why do you say that doesn't tie it down?---The original draft we had, Commissioner, was that it would be reviewed every six months against the target set by the Roche management.
PN788
Yes. No, I understand that, but I understood you to be describing the final agreement didn't tie it down and I'm just reading from the final agreement?---Well, it wasn't - okay, well I believe that still leaves it open to the six monthly review or the three monthly review and it would, it wasn't as clear as the other contractor agreements that we have, Commissioner, that says that we paid district average bonus on a weekly basis. That's where it is not as clear to us. It - - -
PN789
Well, I understand it is open to some - but it seems to me to be a lot- - -?---Well, that's my problem with it.
PN790
Yes, I understand. Yes. Re-examination? Sorry, does - Mr Cuthbertson, does that lead you to anything?
**** KEVIN AUBREY FITZPATRICK XXN MR CUTHBERTSON
PN791
MR CUTHBERTSON: No it doesn't, Commissioner.
PN792
PN793
MR BUKARICA: Just one question arising out of the Commissioner's question, Mr Fitzpatrick, the wording in the Roche agreement appears to provide for a different, slightly different bonus system to that of the district, standard bonus agreement if I could use those terms. Is that - do you understand what I am saying?---Yes.
PN794
It wasn't very clear but there is an agreement about district bonuses for contractors. Is that correct?---Yes.
PN795
And, to the best of your knowledge and involvement, was there any suggestion that Roche would not meet at least the minimum district bonus?---On a weekly basis, yes, there was a suggestion it wouldn't happen. Over a longer term - it was originally suggested that it would be held over, a fair part of it, and I don't know what you'd call a fair part, until the project completion in 12-18 months time and we did not find that acceptable.
PN796
But, what is the position now with Roche in terms of the payment of the bonuses. Are you aware?---They paid district average bonus on a weekly basis.
PN797
As per all the other contractors in the pool?---Yes.
PN798
Nothing further Commissioner.
**** KEVIN AUBREY FITZPATRICK RXN MR BUKARICA
PN799
PN800
THE COMMISSIONER: I'll have my exhibit back, yes.
PN801
MR BUKARICA: We are in the Commissioner's hands on it, I think. I've made my opening. I just reserve my rights to reply to my friend's submissions and we clearly won't finish before lunch time.
PN802
MR CUTHBERTSON: No.
PN803
THE COMMISSIONER: So I think we might take an extended lunch on that basis.
PN804
MR CUTHBERTSON: If the Commission pleases.
PN805
THE COMMISSIONER: Unless there's some objection to that course of action.
PN806
MR CUTHBERTSON: No. It is fine, Commissioner.
PN807
THE COMMISSIONER: We'll adjourn until 2.15. Thank you.
LUNCHEON ADJOURNMENT [12.35pm]
RESUMED [2.15pm]
PN808
THE COMMISSIONER: Now, Mr Kay or Mr Cuthbertson who wants to be first? I'll toss a coin if you like.
PN809
MR KAY: Thank you Commissioner, I guess I got heads. Commissioner, we have before us the outline of submission that was submitted prior to this hearing today from Tahmoor Coal - - -
PN810
PN811
MR KAY: Commissioner, I don't wish to go far beyond that outline of submissions. I believe that basically included in that submission is the Tahmoor case. I don't wish to refer in particular to any particular aspect of that unless the Commission would like me to enlarge on it. I would just like to summarise the position the way we would see it following today's hearing. I believe that the union case boils down to three arguments. One is that there is a reasonable interpretation of our site agreement to the effect that clause 32.7 says that contractors working on site at Tahmoor must work the same rosters. We believe that that is not supported by a plain reading of the words. Reference has been made to the fact that our agreement refers to the fact that contractors must be paid the same base rate and must be paid a district average bonus and there is no dispute about that and that reference to wages and district average bonus is made in clause 32.1.2 and it is quite plain in its effect.
PN812
The reference to rosters, however, is quite separate. It is made in 32.7 and the wording in 32.7 is quite different than the wording that is used to describe what should happen with regard to the base rate and with regard to district average bonus. Now, the wording in 32.7 refers to the fact that contractors should not be used as a precedent and witnesses for Tahmoor have explained why that wording is the way it is. We reject the submission that effectively rosters are impacted in the same way as the district average bonus or as the wage rates. If that was to be the case then the wording would be the same and it is not. So firstly, we just reiterate that a plain reading of the agreement does not support the contention that contractors working on site at Tahmoor must work the same rosters.
PN813
The second arm of the union argument is that contractors working at Tahmoor over a number of years have in fact worked the same rosters and that this in some way creates a custom that should continue. We would submit that firstly, apart from Mr Fitzpatrick's recollection we don't have evidence that that has been the case, as a matter of fact. But even if we do accept that as a matter of fact that has happened, what I believe we have is a situation where contractors have made operational decisions to work certain rosters over a number of years. We don't have contractors, or the company or Tahmoor making industrial decisions about these matters and certainly not industrial decisions that then create precedents for the future.
PN814
The third arm of the union argument is that in some way outside of the formal site agreement there has been some other undertaking or agreement that contractors will work the same rosters and in particular this refers to the Roche contract. Once again apart from various firmly held beliefs and various opinions about what was said at various times the only evidence we have is that document which was in Mr Fitzpatrick's evidence marked HG, my apologies marked G. I stand to be corrected on that. My apologies Commissioner I'll just check which reference that one was. Somebody else might be able to help me out there as to which reference that was in Mr Fitzpatrick's evidence that referred to clause 7 - - -
PN815
MR CUTHBERTSON: D
PN816
MR KAY: D, my apologies it was D. The only evidence there is that paragraph number 7 in the item marked D. Now, we believe that the company response to the question, the question being that roster packages for contractors should be the same as Tahmoor's. We believe that the company response was clear that we simply referred the union back to the agreement. Of course the union believed that it wasn't a clear response, that it was in some way ambiguous and we've heard submissions to that effect today. Whatever it was Commissioner it falls well short of a clear undertaking from that the company that contractors would work the same rosters.
PN817
Commissioner it seems that there are three legs to the union argument and we believe that the union arguments have failed in all cases to substantiate that either the main site agreement provides that contractors should work the same rosters or that in the particular case of Roche that there was some form of agreement or undertaking that Roche would work the same rosters as Tahmoor.
PN818
Commissioner, just one other thing that I would like to refer to. Two cases were submitted today from the union that refer to the ability of agreements to have provisions along the lines of the way the union would like to interpret clause 32.7. In other words provisions which allow a provision in a site agreement such as ours to determine the rosters worked by third parties, contractors, who come on work at site at Tahmoor. Their submission in presenting these two cases is that case law is such that that would be allowable.
PN819
Firstly, I would say that we did expect that we would have these submissions from the unions two days ago as per the previous recommendation of the Commission in which case we would have had more of an opportunity to properly respond to these two cases. But that aside, Commissioner, I would say that this whole argument is problematic to say the least. There have been a number of cases which have attempted to address the question of whether there can be provisions in an agreement which does not refer to the requisite relationship between the employer and the employee as provided in section 170LI of the Act and at the very least it has led to some uncertainty about whether that can be the case or not. Certainly the two cases that were submitted by the union this morning do not refer specifically to a provision relating to rosters and to a provision which provides that employees of a contractor must work the same rosters as the employees of the principal. For those reasons, Commissioner, I believe that at very least there is doubt as to whether it is permissible for the Commission to recognise a provision that would be understood and interpreted along the lines that the union would like us to interpret it. Commissioner, I have no further submission, if the Commission pleases.
PN820
THE COMMISSIONER: Yes, Mr Kay, a couple of things. In paragraph 1(l) you state that for its part Tahmoor has reviewed all the recent commercial contracts and is aware of no instance where a commercial contract is containing a provision requiring the contractor's employees to work the same roster as Tahmoor employees. Is there evidence about that or is that simply a submission. Was that in your witness statement or - - -
PN821
MR KAY: Yes, Commissioner, it is in my witness statement.
PN822
THE COMMISSIONER: Can I just have that please? Are you able to take me to it?
PN823
MR KAY: Paragraph number 6 of my witness statement, Commissioner.
PN824
THE COMMISSIONER: The other matter goes to that question of the submissions in reply and not having been provided in accordance with the directions. I appreciate your difficulty in regard to the cases that have been tabled and what I propose to do is give you an opportunity to provide some written submissions in respect to that matter. Do you have any difficulty with that?
PN825
MR KAY: No, Commissioner.
PN826
THE COMMISSIONER: Mr Bukarica, do you have a problem with that?
PN827
MR BUKARICA: No, Commissioner.
PN828
THE COMMISSIONER: I mean you don't have to take up the option but I would welcome your reasonable response to those cases so I give you a period of seven days in which to make written response.
PN829
MR KAY: Yes, Commissioner.
PN830
THE COMMISSIONER: Yes, thank you. Mr Cuthbertson?
PN831
MR CUTHBERTSON: Thank you, Commissioner.
PN832
THE COMMISSIONER: Mr Cuthbertson, I understand from what's been said earlier that you're not really in the gun in this matter any more in a direct sense.
PN833
MR CUTHBERTSON: It sounds like it. I must admit my initial reaction this morning was wondering why we're sitting here. In any event having said that there were - I guess it is important for us to for the record just indicate that - - -
PN834
THE COMMISSIONER: I think you're in the gun in a practical sense but not in a -
PN835
MR CUTHBERTSON: If it is appropriate I'd now like to seek to have marked as an exhibit our outline of submissions and just indicate for the record that we seek to rely upon those submissions made.
PN836
THE COMMISSIONER: Yes, there's an outline of submissions and attachment A to those. Is there just the one attachment?
PN837
MR CUTHBERTSON: That's correct.
PN838
PN839
MR CUTHBERTSON: The aim of the point that I do wish to raise, Commissioner, is just simply to indicate this, that there are no other arrangements, agreements either written or verbal between Roche and the CFMEU with respect to terms and conditions of employment other than that contained within the Roche certified agreement.
PN840
As was indicated through evidence this morning where there is an intention to rely upon other documents outside of the Roche certified agreement they have been specifically referenced within the certified agreement itself in clause 2.1 subsection (g) which relates to terms and conditions of work in relation to Saturday/Sunday employees we say is evidence of that fact.
PN841
You've likewise heard evidence from Mr Duncan that his understanding of clause 4.1 of the Roche certified agreement is reflective of what was agreed between himself and the CFMEU during his discussions. Commissioner, unless you have particular questions of me in relation to the outline of submissions the only other thing I would like to raise is simply to ask the Commission's indulgence if we could likewise have seven days to respond to some of the case law that has been presented today by Mr Bukarica.
PN842
THE COMMISSIONER: Yes. Mr Bukarica, do you have any difficulty?
PN843
MR BUKARICA: No, Commissioner.
PN844
THE COMMISSIONER: Yes, certainly the same invitation is extended to you, whether you take up that invitation on reflection is a matter for you.
PN845
MR CUTHBERTSON: Thank you, Commissioner.
PN846
THE COMMISSIONER: Mr Bukarica:
PN847
MR BUKARICA: If the Commission pleases, there are two specific issues I want to respond to in respect to what has fallen from Mr Kay specifically, and firstly, there was a submission made to the effect that the evidence before the Commission today concerning the custom and practice of roster arrangements for subcontractors is in some way inadequate. For our part we say that the union provided what evidence it had available and the evidence that we rely upon is Mr Fitzpatrick's long experience and significant role at the Tahmoor mine site over 17 or 18 years.
PN848
Mr Fitzpatrick, is the principal lodge officer at the mine and the Commission would be well aware that within the rules of the CFMEU that's the senior elected employee representative, and according to Mr Fitzpatrick's own evidence he has an extensive involvement in all employee relations issues on site. So we say as to the issue of evidence about that point that the company has had a significant amount of time to do the exercise, disprove what we say to be fact, and is unable to do so.
PN849
Similarly, Mr Kay, raises - and I appreciate he is now going to have the opportunity of making reasoned written submissions concerning the legalities if you like of the regulation of subcontractors. I rely on what was said at the outset and I rely upon the authorities submitted to the Commission. But additionally I point to the fact that the company by its own evidence has extensively involved itself in regulating the terms and conditions of employment of contractor employees on its site. It does so directly through the agreement in relation to wage rates and bonuses.
PN850
There is also, though some argument about this issue, there is also an involvement by the company in relation to the establishment of manning levels in respect to contractors which we say is reflected in the principal agreement. So if there are some doubts or legal questions pertaining perhaps that should have been an issue that occupied the company at the time the agreements were entered into and it somewhat undermines the case to say, well, it might be legal or correct for us to regulate wages on the one hand but not rosters; it just doesn't seem to me to wash. Really, the issue in a legal sense is not whether Austral Coal has the ability through its agreement to tell Roche via the agreement what it can and can't do, the issue is really whether by an agreement we can bind Austral Coal and the union for Austral Coal to act in a certain way contractually with its contractors on site to deliver certain outcomes.
PN851
THE COMMISSIONER: I must say I find conceptually some difficulty here. It seems to me that at least on the authorities it would be open to the parties to an agreement to agree that contractors would not be employed; is that right?
PN852
MR BUKARICA: To make an agreement to that effect?
PN853
THE COMMISSIONER: Yes.
PN854
MR BUKARICA: Yes.
PN855
THE COMMISSIONER: In the company's operations.
PN856
MR BUKARICA: Yes.
PN857
THE COMMISSIONER: So it would be open to a union to make that claim and it would be a legitimate claim?
PN858
MR BUKARICA: Yes.
PN859
THE COMMISSIONER: Yet somehow in settlement of that claim it's not open to the parties to an agreement to put conditions on those contractors when they come?
PN860
MR BUKARICA: I understand what you're alluding to, Commissioner, and I agree that it's - - -
PN861
THE COMMISSIONER: Any assistance you can give me I'll be happy with.
PN862
MR BUKARICA: I agree with you, I think that they're logically inconsistent that you can have one position where you can totally, for example, ban outsourcing or contracting; on the other hand you can't regulate it, if you like.
PN863
THE COMMISSIONER: Yes or, more importantly, you can't reach a compromise that amounts to regulation.
PN864
MR BUKARICA: Yes. My understanding of the law is this that you can do it so long as you are not purporting that the industrial instrument between a union and a head contractor or principal binds by itself, by its operation, binds a subcontractor.
PN865
THE COMMISSIONER: I understand that.
PN866
MR BUKARICA: I think that's where we're confused about the issue. There is nothing to stop you from agreeing so long as it is lawful trade practices-wise or whatever, with a union and a head contractor that the head contractor will run their business in a particular way. That's entirely lawful.
PN867
THE COMMISSIONER: But isn't the practical effect of that, and I'm more concerned about that, at some point in time, assuming the employees have got sufficient bargaining power, that if they can't produce a result that regulates the way in which contractors operate then they just say, well, no contractors.
PN868
MR BUKARICA: In the rare event that you have such bargaining power but I think the reality is, certainly in the industries that I've got some familiarity with, that race has long been lost, if you like.
PN869
THE COMMISSIONER: Run and lost.
PN870
MR BUKARICA: Yes, run and lost and contractors are a fact of life and the position is that it's a matter to what extent you can regulate, from a union point of view, the operations of contractors on sites.
PN871
THE COMMISSIONER: Though I just wonder whether it hasn't been lost in the context of there being agreement "lost" in the context of there being agreement about how it would be regulated.
PN872
MR BUKARICA: I'm not quite sure I follow you there, Commissioner, sorry.
PN873
THE COMMISSIONER: That the unions have conceded contractors because there's been a compromise about the way in which contractors will come on the site.
PN874
MR BUKARICA: Absolutely.
PN875
THE COMMISSIONER: And maybe if that compromise hadn't been reached it wouldn't have been lost.
PN876
MR BUKARICA: It's an interesting historical point. I certainly think in relation, for example, to the use of labour hire, and we're off the track here, Commissioner, but it's an interesting point, my view has historically been that that's exactly the case that had certain industrial organisations not taken the temptation of giving labour hire a degree of legitimacy at first instance then the position of resisting what I think is, personally - - -
PN877
THE COMMISSIONER: I think it's more complicated than that because people were offered the job and got redundancies from one place and picked up a job the next day as a contractor or a labour hire employee.
PN878
MR BUKARICA: Yes, that's right.
PN879
THE COMMISSIONER: And it just added to it.
PN880
MR BUKARICA: We're getting into philosophical issues now but what I am concerned about is this proposition that legally or jurisdictionally the Commission can't do what we're saying it should do, that is recognise the existence of an agreement between the parties to that effect. I think, clearly, the Commission can and I think there's authority to support that.
PN881
THE COMMISSIONER: There's probably not a lot of argument between you and I haven't had the advantage of Mr Kay's and Mr Cuthbertson's immediate response yet but it seems to me that it may come down to a question of degree, the extent to which the imposition of Tahmoor's rosters on the contractor Roche would amount to an impermissible exercise of that - - -
PN882
MR BUKARICA: I don't see a requirement, for example, from Tahmoor, the principal, to any prospective subcontractor which said, you must apply one of the rosters in appendix 1 of our agreement as being impermissible. If that's what the parties have agreed to give effect to then the principal can legally do that. That's as simple as I can put it.
PN883
THE COMMISSIONER: And you would say that that is permissible under the terms of those decisions that you gave to me.
PN884
MR BUKARICA: Yes. What would be impermissible, for example, would be the agreement attempting to say, this agreement directly regulates Roche contractors, or, purports to be the agreement which binds Roche contractors. It doesn't. I am saying the Tahmoor agreement - - -
PN885
THE COMMISSIONER: So you say it doesn't go that far.
PN886
MR BUKARICA: It doesn't bind the subcontractors.
PN887
THE COMMISSIONER: It binds Tahmoor to require Roche to restrict the hours of operation to the hours that are contained in the appendix?
PN888
MR BUKARICA: Yes. It binds Tahmoor to act in a certain way, contractually in a certain manner.
PN889
THE COMMISSIONER: Let's assume for the moment you're correct about everything that flows and the Commission determines that, but the contractual relations between Tahmoor and Roche that were struck before that settlement, if you like, preclude them doing that. We don't know whether they do, I just don't know what the contractual relations are, there's no evidence before me, but when it comes to enforcement Tahmoor says, well, we just don't have the power to do that.
PN890
MR BUKARICA: We should bring it back to where we are here and as I understand the proceedings the three parties have said we will abide by what the decision is here at the Commission. So, assuming for the sake of the argument, the Commission goes our way we would expect that both parties here apply that decision just as if the Commission comes to a contrary view we respect the Commission's decision.
PN891
THE COMMISSIONER: Yes, I understand that.
PN892
So taking it a step further about enforcements, I don't think that arises.
PN893
THE COMMISSIONER: I presume in the same way as the recommendation that I made back on 14 November, as you've complied with.
PN894
MR BUKARICA: That's how I understand it, Commission. So I don't know if we traversed that and perhaps it's unfair without the further detailed submissions but can I just say, Commissioner from my point of view, there is no legal or jurisdictional impediment to the type of finding we seek which then brings us to the merits of the argument. It's clear as we said from the outset and we rely on everything that has been put before the Commission, that we say that the agreement between the parties is not just reflected in the bare words of the Tahmoor Agreement, that the agreement really is an understanding which has been in place at the mine site for a number of years that, to use Mr Fitzpatrick's words, when in Rome do as the Romans do.
PN895
That has been implemented in a practical sense, in the custom and practice sense, it's been recognised, it's been clearly articulated as the union understanding of the position consistently and accepted as such by the company that that is the union position. The only deviation that we see from that custom and practice is with the most recent situation with Roche, where as a result of certain contractual pressures a different arrangement is sought to be put in place.
PN896
Now, in defence of that, Austral Coal says, well look, we never foreclosed the possibility that that could happen, we never guaranteed the union that contractors would only ever work the rosters under the appendix 1. The only support they really have, the company has, Austral has in support of that is the words which appear in appendix D to Mr Fitzpatrick's statement where they use a set of words in reply to a clear union demand which the union interpreted as essentially, in my submission, confirming what has always been place and indeed, giving extra assurance because you will recall the evidence, the Tahmoor North Development Agreement actually arose out of additional concerns the union had about contractors, that is, expansion contractors.
PN897
So we have this existing understanding and we submit this is what actually occurred. We have the existing understanding everyone works, everyone, when in Rome do as the Romans do, everyone works the same rosters. The company comes to the union and says, look, we can't do this major development project under our own steam, we need to expand the use of contractors dramatically, the union gets into negotiations, has a wide range of concerns but one of them clearly articulated and consistent, being the rosters must be the same.
PN898
The critical point in this I think is, Mr Commissioner and the evidence on this is and I invite you to review it is, given the opportunity to clearly put to the union that the custom and practice was now going to change or wasn't what the union said it was, we have a set of words which at best, are ambiguous. In my submission those words amount to the company telling the union, on one hand reassuring the union that the status quo, as has always applied, will continue to exist but leaving the wording delicately ambiguous in order to if required, get out of that deal, get out of that arrangement.
PN899
Now, that's putting it, perhaps not very elegantly but my assessment of the evidence and what I've seen of the material is precisely that, here is a clear opportunity the company say, no we are not accepting your demand, subcontractors have got the right to use whatever rosters they like but instead of that we have these, what I've perhaps maybe unfairly called, weasel words but maybe not unfairly which - - -
PN900
THE COMMISSIONER: Agreed weasel words if they are weasel words.
PN901
MR BUKARICA: That's perhaps right but in any case, I say there is an agreement, there is an understanding and the understanding is, the contractors will work the appendix 1 rosters. The position, of course, as well is that for the company and I know there are certain issues here which the Commission has got to find one way or the other as to the nature of the agreement or otherwise but it seems to me at the very least, difficult to come to terms with the notion that the company can actively regulate and specifically regulate wages, bonuses, manning levels. Though I accept there is some argument about that and they've all been applied in a consistent way and in a consistent manner all along.
PN902
Rosters in practice have been applied in exactly the same way we say but the argument from the company is, well, there's not an agreement or there's not an understanding about rosters. So of the four core areas, one of them is not really set in concrete, that's the one that they can get out of and in this case, we respectfully submit that is what has occurred. Really, at the end of the day in our submission, for this agreement to work, for it to be applied in the way it was meant to be and, of course, that's the nature of the Commission's exercise in this, is to make sure the agreement is applied in the way it's intended. It can't be applied properly or correctly unless that is taken account of.
PN903
So Commissioner, unless there are any other questions, I am perhaps going around the block again but they are our submissions.
PN904
THE COMMISSIONER: I want to see if I've got something straight in my mind, I think you say or you do say there is ambiguity about 32.7 and the differing interpretation of 32.7 are these, if I've got it right: that in no way being used as a precedent, the union means that if they were to work different rosters that would be precedent, in other words, if contractors were to work different rosters, that would be in a way a precedent to change current work standards for the workers.
PN905
MR BUKARICA: Yes, Commissioner.
PN906
THE COMMISSIONER: The company says, no, no,
PN907
MR BUKARICA: Yes, Commissioner.
PN908
THE COMMISSIONER: All it means is, we will not use the fact that contractors' use of different rosters is in any way a thin edge of the wedge as a precedent for you, the work-force of Tahmoor to change rosters. Is that it?
PN909
MR BUKARICA: That's essentially right, Commissioner but with one additional element which came out of Mr Fitzpatrick in reply to cross-examination, I recall Mr Fitzpatrick used words to the effect of well, there are non-core contractors as well covered by that clause, that is, contractors who come in from time to time to do minor and peripheral works, deliveries and the like, whatever rosters they are on that's meant to cover. In other words, the company can't use the mere fact that you have say, a mechanical contractor come on the job for a short period, if their guys are working a 12-hour shift or whatever, that can't be used. That's how I understood his evidence.
PN910
THE COMMISSIONER: It's a bit hard to know how it would be but yes, I understand what you are saying.
PN911
MR BUKARICA: In other words, it didn't just apply to these core contractors but the others as well.
PN912
THE COMMISSIONER: So it in fact has two meanings for the union; one is the meaning that the company gives it, that is, the fact that people work these different shifts can't be used as a precedent and the second meaning which is, were people doing the same work, that is, the core contractors doing the same work, working different shifts, that would be a precedent.
PN913
MR BUKARICA: Yes, Commissioner.
PN914
THE COMMISSIONER: And that is what that means.
PN915
MR BUKARICA: Yes, that's correct, Commissioner.
PN916
THE COMMISSIONER: Yes, I understand that. Mr Bukarica, do you want an opportunity to respond to those written submissions?
PN917
MR BUKARICA: It depends on what they say, Mr Commissioner.
PN918
THE COMMISSIONER: I think you've probably got to have the right to, so I'll give you a further seven days after that in which to respond, if none is received I'll presume you haven't. I think there is one other matter I need to raise with the parties and that is, that the interim arrangement expires tomorrow, I kept it that way because I didn't know just where we were going to get in the context of this case. It would be my intention to extend that recommendation until such time as I provide a decision. Is there any argument in opposition to that?
PN919
MR BUKARICA: No, Commissioner, provided it is without prejudice to the case.
PN920
THE COMMISSIONER: In all of the other circumstances, without prejudice, yes, because the original recommendation is an interim measure without prejudice and I would simply be continuing that until such time as a decision is announced.
PN921
MR BUKARICA; Without wishing to put the Commission under any pressure at all as well - - -
PN922
THE COMMISSIONER: The only pressure will be transcript. I have no other decisions to write. I am in an exceedingly comfortable position in those matters.
PN923
MR BUKARICA; So it will be a relatively short period.
PN924
THE COMMISSIONER: Yes. And that is as strong a commitment as you are going to get from me. In those circumstances, the recommendations contained in paragraph 3 of my recommendation and directions of 14 November 2003 which expires on Friday, 16 January 2004 is extended until such time as a decision is provided in this matter and I propose to reserve that decision. The proceedings are adjourned to a date to be fixed.
ADJOURNED INDEFINITELY [3.00pm]
INDEX
LIST OF WITNESSES, EXHIBITS AND MFIs |
EXHIBIT #B1 OUTLINE OF SUBMISSIONS PN328
RAYMOND ALAN JOHNSON, SWORN PN356
EXAMINATION-IN-CHIEF BY MR KAY PN356
EXHIBIT #K2 WITNESS STATEMENT OF MR JOHNSON PN362
CROSS-EXAMINATION BY MR BUKARICA PN362
RE-EXAMINATION BY MR KAY PN546
WITNESS WITHDREW PN558
JOHN STUART KAY, AFFIRMED PN565
EXHIBIT #K3 STATEMENT OF JOHN STUART KAY PN572
CROSS-EXAMINATION BY MR BUKARICA PN574
WITNESS WITHDREW PN655
GREG ROBERTSON DUNCAN, SWORN PN656
EXAMINATION-IN-CHIEF BY MR CUTHBERTSON PN656
EXHIBIT #C1 WITNESS STATEMENT OF GREG DUNCAN PN673
CROSS-EXAMINATION BY MR BUKARICA PN673
RE-EXAMINATION BY MR CUTHBERTSON PN706
WITNESS WITHDREW PN716
EXHIBIT #C2 STATEMENT OF MR J. HAYWARD PN722
KEVIN AUBREY FITZPATRICK, SWORN PN725
EXAMINATION-IN-CHIEF BY MR BUKARICA PN725
EXHIBIT #B2 WITNESS STATEMENT PN735
CROSS-EXAMINATION BY MR KAY PN737
CROSS-EXAMINATION BY MR CUTHBERTSON PN747
RE-EXAMINATION BY MR BUKARICA PN793
WITNESS WITHDREW PN800
EXHIBIT #K4 SUBMISSION FROM TAHMOOR COAL PN811
EXHIBIT #C3 OUTLINE OF SUBMISSIONS AND ATTACHMENT A PN839
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