AG2003/9364, Transcript of Proceedings [2004] AIRCTrans 417 (3 February 2004)

AUSCRIPT PTY LTD
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TRANSCRIPT OF PROCEEDINGS

AUSTRALIAN INDUSTRIAL O/N F1306

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

AG2003/9364

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LJ of the Act
by the Australian Workers' Union - Greater
South Australian Branch and Another for
certification of the Kangara Foods Pty Ltd
Packing Shed Certified Agreement 2003

ADELAIDE

1.35 PM, WEDNESDAY, 21 JANUARY 2004

PN1

MR J. O'NEILL: I appear for the Australian Workers' Union and with me site shop steward, MR S. DWYER.

PN2

MS J. STONE: I appear for Kangara, Human Resource Manager and with me our general manager, MR R. HAMLEY.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you. Who is going to open the exercise this morning?

PN4

MS STONE: I will.

PN5

THE SENIOR DEPUTY PRESIDENT: You have got that honour, have you Ms Stone?

PN6

MS STONE: I do.

PN7

THE SENIOR DEPUTY PRESIDENT: Away you go. You can take it as a given that I have read the statutory declarations together with the agreement.

PN8

MS STONE: I would just like to start by perhaps giving a short overview of Kangara. Kangara is a currant, citrus and juicing operation. We have two parts to our operation. One is the packing shed where we process and pack all of our citrus, currants and juice and the other is our horticultural operation where we grow our currants and vines and have our citrus orchards. This particular submission is for the packing shed. This is an application to certify an agreement. The agreement is a section 170LJ agreement that has been made with an organisation of employees being the Australian Workers Union, in accordance with the Workplace Relations Act.

PN9

It is the submission of Kangara that each of the requirements under section 170LT have been met and we rely upon the information in our statutory declaration to confirm that. We believe the agreement passes the no disadvantage test as compared to the relevant Federal award which covers the employment party to this agreement, namely the Horticultural Industry AWU Award of 2000. A detailed comparison has also been attached to the statutory declaration. We would like to state that the employees were given 14 days access to the agreement prior to the ballot taking place. Employees were given a summary of the main terms of the agreement, details of where to get a copy of the agreement, a full text copy of the agreement and who to direct their questions to if they had any.

PN10

The ballot was held on 11 December 2003. It was a secret ballot and the ballots were counted in the presence of the AWU members and committee members. We believe the agreement contains a dispute settlement procedure in clause 12. Also the agreement contains the normal expiry date of 2 years from the date of certification and we welcome any questions from your Honour at this time.

PN11

THE SENIOR DEPUTY PRESIDENT: Yes. I have a number of questions about the agreement but it might be best if I hear from Mr O'Neill first of all. Thank you. Mr O'Neill, are you in agreement with everything that Ms Stone has told me?

PN12

MR O'NEILL: Sorry Commissioner?

PN13

THE SENIOR DEPUTY PRESIDENT: Are you in agreement with everything that Ms Stone has told me?

PN14

MR O'NEILL: Entirely.

PN15

THE SENIOR DEPUTY PRESIDENT: Is there anything that you want to add?

PN16

MR O'NEILL: The only couple of things I would add, Senior Deputy President is that you may recall that in about the middle of last year in July the parties did have cause to come before yourself.

PN17

THE SENIOR DEPUTY PRESIDENT: Yes, I do recall that.

PN18

MR O'NEILL: There were some difficulties that we were having at the time and at the end of those submissions you did put out a statement of assistance to the parties on how we should address the problems that we were experiencing at the time. Certainly the committee, the company and the union and our shop stewards addressed every one of those matters and worked our way through some - what were difficult times, at times but at the end of the day even though the AWU is not totally satisfied and probably never will be but we weren't totally satisfied with the outcome.

PN19

There is absolutely no doubt that the end result of the negotiations of our members and the other employees in the factory could see and appreciate the work that had been put into the new enterprise agreement and the overwhelming vote that was held late last year was in favour of the agreement with a recommendation for our organisation to come before the Commission and recommend it as an agreement to be ratified and to become the working conditions for the next 2 years at the Kangara work site. I totally concur with all of the statements made by Ms Stone.

PN20

THE SENIOR DEPUTY PRESIDENT: Very good. Mr O'Neill I have got a number of questions that I will address to Ms Stone - - -

PN21

MR O'NEILL: Yes.

PN22

THE SENIOR DEPUTY PRESIDENT: But please feel free to hop up and tell me whether you want to add or indeed even detract from anything that she might say to me.

PN23

MR O'NEILL: Thank you.

PN24

THE SENIOR DEPUTY PRESIDENT: My questions go to the provisions of the agreement. They don't invite either party to rewrite the document but instead they go to trying to clarify the intention of the parties in a number of respects. They also go toward clarifying the - the remaining question that I have relative to the no disadvantage test. Now Ms Stone, can I take you first of all to clause 6? Can I clarify that notwithstanding the possibility that the words in clause 6 which relates to the term of the agreement might be a little confusing, that the intention of the parties is that the agreement will operate for a period of 2 years from the date of certification?

PN25

MS STONE: Yes.

PN26

THE SENIOR DEPUTY PRESIDENT: Unless of course it is either amended in accordance with the Act or at some future stage subsequent to those 2 years, it is replaced. Is that correct?

PN27

MS STONE: Our intention was that this agreement would have a 2 year life span and that we would then negotiate with all parties a new agreement prior to the end of the 2 years so that the new agreement would take place after that.

PN28

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 9 refers to company policies and procedures. I will refer back to this clause a little later on a couple of occasions but am I to understand that those policies and procedures are all documented, that they are readily available to employees and that they may be changed during the life of this agreement?

PN29

MS STONE: In answer to your first question, the majority of our policies are documented. I wouldn't suggest we have a policy for every possible eventuality. The second part of your question, which is: are they available, they are available in my office basically. We have at Chiquita - which is our parent company - HR and OH&S Policy and Procedure Manual. So people can come and look at those if they require and we do refer to them as needed. What we aim to do though is to involve the consultative committee in development of new policies and procedures as we need to. The Chiquita policies are very broad and we need to make them more relevant to our business.

PN30

THE SENIOR DEPUTY PRESIDENT: I see. Thank you. Can I then take you to clause 12, which is the dispute resolution provision, and in particular 12(c) which envisages that a matter which has not been agreed between the parties might be referred to mediation. Who selects the mediator and what happens if there is no agreement in that regard?

PN31

MS STONE: To be honest I had not considered that at that that point when we wrote it.

PN32

THE SENIOR DEPUTY PRESIDENT: You see, it seems to be a fairly fundamental issue. It would be a great pity if you had a dispute over your dispute resolution procedure. It might distract you from the real thing.

PN33

MS STONE: Certainly. My thoughts on this from the management point of view would be that mediation would involve someone such as yourself, your Honour or a similar person with the powers to recommend or review, to assist us to solve those sorts of disputes.

PN34

THE SENIOR DEPUTY PRESIDENT: Yes. Can I suggest that you might want to briefly put your head together with Mr O'Neill just to see whether you both have the same understanding in that regard.

PN35

MS STONE: Certainly.

PN36

THE SENIOR DEPUTY PRESIDENT: I won't adjourn the proceedings but you could possibly meet in the middle and see how you go.

PN37

MS STONE: Your Honour, after discussions with John we believe that mediation would be referred to the AIRC.

PN38

THE SENIOR DEPUTY PRESIDENT: I see, and am I correct in understanding then that if the mediation process did not resolve the issue then the dispute will continue on ad infinitum, that is there is no capacity for an arbitrated outcome? There is no right or wrong answer. I am just perhaps more interested in whether the parties have a common understanding of the clause that they have drafted.

PN39

MS STONE: My understanding is that from the involvement we have had with your Honour previously we have been able to, through your assistance come to agreement. So I believe that that would be the - the outcomes would be same if that makes sense.

PN40

THE SENIOR DEPUTY PRESIDENT: So you are agreeing that the process stops at mediation and the hope would be that that member of the Australian Industrial Relations Commissions might be able to arrive at an agreed mediated outcome?

PN41

MS STONE: Yes.

PN42

THE SENIOR DEPUTY PRESIDENT: Because of the significance of that matter Mr O'Neill, can I take it that you are in agreement with that answer?

PN43

MR O'NEILL: Yes.

PN44

THE SENIOR DEPUTY PRESIDENT: Clause 13.4 relates to the use of outside contractors. Now clearly the agreement applies to Kangara, the AWU and Kangara's employees. How should I understand the intention of this particular provision?

PN45

MS STONE: This provision has been put in your Honour, because we have in the past used labour hire firms and we do have a number of contractors working for us, such as electricians and plumbers etcetera. The clause was put in there purely to advise people that this is something that the company would like to continue and where possible where we use labour hire employees we would like them to be paid in accordance to our AWA so that if we have two people working side by side, one employed by Kangara and one employed by the labour hire firm, their remuneration and their conditions of employment are the same.

PN46

THE SENIOR DEPUTY PRESIDENT: I see. But am I correct in understanding that the clause does not establish or seek to establish any binding obligation on the part of the labour hire company?

PN47

MS STONE: No. That is correct.

PN48

THE SENIOR DEPUTY PRESIDENT: Clause 13.5 relates to aged or infirmed workers. Am I to understand that phrase might be regarded as somewhat synonymous with the concept of supported employment?

PN49

MS STONE: Yes.

PN50

THE SENIOR DEPUTY PRESIDENT: If that is the case, then how can you assure me that the lower wage rate than that set out in clause 14 of the agreement would be at least equal to the rate specified in the relevant award? Are you able to give me an undertaking in that regard?

PN51

MS STONE: Absolutely. Yes, your Honour.

PN52

THE SENIOR DEPUTY PRESIDENT: So that at minimum any persons employed under that provision would receive payments that equated to the payment provisions applicable to them under the award.

PN53

MS STONE: Yes, your Honour.

PN54

THE SENIOR DEPUTY PRESIDENT: Clause 14.1 proposed the development of a classifications and wage rates matrix. Am I to understand that that matrix would not result in the reduction in the rates that are set out in the schedule attached to the agreement?

PN55

MS STONE: That is correct, your Honour.

PN56

THE SENIOR DEPUTY PRESIDENT: Perhaps I need to revisit that question. Is it conceivable that an employee who might have been classified for instance as a Level 3 could as a result of that new matrix end up by being classified as a Level 2.

PN57

MS STONE: No. Your Honour we - employees currently with the organisation will not have a decrease in their rates of pay. If the new classification sees their role as a level 2, that they are currently with the organisation, their rates of pay will not change. Where a new person comes into the organisation their classification will be according to the new rates of matrix. From management's draft work we do not see that there will be significant changes for the majority of employees. For the majority of employees the majority of changes will happen with leading hands and similar people rather than general work-force, packers, sorters and machine operators.

PN58

THE SENIOR DEPUTY PRESIDENT: Can I then take you to clause 18, a clause about which I seek clarification, particularly with regard to the no disadvantage test. If an employee, who was classified, say, level 1, worked 10 hours overtime, that is in excess of 40 hours per week, then can you tell me how that person would, at the present time, receive, at least the award rates for the entirety of their work for that week.

PN59

MS STONE: I am sorry, I didn't understand the question.

PN60

THE SENIOR DEPUTY PRESIDENT: Perhaps I will try to make it clearer. Let us say an employee is classified at level 1. They work a 50-hour week. Can you tell me how, under the agreement, they receive an amount which is at least equal to that which they would have got under the award? Take your time. There is no rush, if you need to have a look at it, then feel free to do so.

PN61

MS STONE: In the situation you have stated, the employee would be disadvantaged. They would certainly earn less than they would under the award due to the overtime rates. Our understanding or our calculations have come up with a point at which an employee will be disadvantaged, which we believe is about 4.5 hours overtime a week. The company's intention, under new management, is to ensure that employees do not do excessive amounts of overtime for a number of reasons, including safety and personal family issues. In the event that a person does do excessive amounts of overtime, the company would make an undertaking to ensure they were not disadvantaged in any way.

PN62

THE SENIOR DEPUTY PRESIDENT: So can I put that in my words and you can tell me whether it reflects the undertaking that I understand you are proposing to me. In the event that the overtime requirement requested by the company resulted in a payment less than that which would be applicable under the award, then the employee would receive at least the award payment?

PN63

MS STONE: That's correct, yes.

PN64

THE SENIOR DEPUTY PRESIDENT: That undertaking would apply with reference, particularly to clause 18, such that it would not lessen the requirement set out in 18(c) and (d) but would impact on the payment for that time?

PN65

MS STONE: That's correct, yes.

PN66

MR O'NEILL: Mr Deputy President, if I could just also touch on that, if possible. Possibly, out of all of the discussions and negotiations that we have had with management over this current enterprise agreement, that would have been the most contentious of the items. We did, in fact, with management, do exactly what Mrs Stone has said and we went through where there is a crossover point where once you work so much overtime you then are disadvantaged.

PN67

It is with relief, today, I hear management's response that when that crossover point is reached, that due to the no disadvantage requirement if there is a disadvantage, that will then be topped up to ensure the disadvantage does not apply. That was one of the items we had much debate over and it does me good to hear management have also now recognised that and that position has been rectified.

PN68

THE SENIOR DEPUTY PRESIDENT: The undertaking that I have repeated, in my words, Ms Stone's endorsed, does not refer to the concept of a crossover point as a defined number of overtime hours because it appears clear to me, looking at the rates of pay, the point at which an employee might conceivably be disadvantaged might vary according to the different classifications and the time at which the assessment was made. So as I understand the employer undertaking, it is specific circumstances will be considered on their own merits. Clause 22.2 relates to tool allowances. Where do maintenance employees fit within the four level structure?

PN69

MS STONE: It depends on their qualifications, your Honour. Under our new or our wage matrix, which is to be revised, an unqualified maintenance employee fits into a level 3, a qualified maintenance employee fits into a level 5, which you will notice is not actually in the current structure. At the moment, they are being paid according to those levels but not according to the ones that are in the current EBA. Does that make sense? We are actually paying them more than our current structure allows.

PN70

THE SENIOR DEPUTY PRESIDENT: Thank you. The next question may fall into the same category, 22.3 is the boiler attendants allowance. It talks of that allowance possibly being incorporated in the employee's current hourly rate of pay. Does that apply to the personnel with respect to whom you are paying over the agreement rates?

PN71

MS STONE: That's correct, yes.

PN72

THE SENIOR DEPUTY PRESIDENT: Clause 24(d) refers to the company's, presumably, meal allowance policy. Is that one of the policies that is documented?

PN73

MS STONE: Yes, it is.

PN74

THE SENIOR DEPUTY PRESIDENT: Clause 28.4 refers to, presumably, an equal opportunity policy. Is that similarly one of the documented policies?

PN75

MS STONE: Yes, it is, your Honour.

PN76

THE SENIOR DEPUTY PRESIDENT: Clause 29.5 refers to acceptable alternative employment. I am working on the premise if the parties can't agree on what constitutes acceptable alternative employment that is one of the matters that will be addressed through the dispute resolution provision, is that correct?

PN77

MS STONE: Yes, your Honour.

PN78

THE SENIOR DEPUTY PRESIDENT: Clause 37 relates to workers compensation. It is on page 26. It refers to an injury management rehabilitation policy. Is that also one of the documented policies?

PN79

MS STONE: Yes, it is, your Honour.

PN80

THE SENIOR DEPUTY PRESIDENT: Thank you, Ms Stone. Mr O'Neill, I am working on the premise that you would have hopped up and told me if you disagree with anything else that Ms Stone has said, is that correct?

PN81

MR O'NEILL: Yes.

PN82

THE SENIOR DEPUTY PRESIDENT: On the basis of the information I have been given, and in particular the undertakings that I have been given by the employer, I am satisfied the agreement meets the requirements of the no disadvantage test. I am equally satisfied that the agreement meets the requirements of the Act on the basis that it is proposed to have effect for a period of 2 years from the date of certification. The agreement does not contain provisions which are contrary to the Act.

PN83

It contains dispute resolution provision, the operation of which the parties have clarified today. I am satisfied the agreement was reached through a process consistent with the Act and I will certify it with effect from today. I congratulate the parties on reaching this agreement and sincerely hope that I do not see you again in 2 years time and that the agreement operates to benefit both the employer and the employees.

PN84

The certificate giving effect to the certification of the agreement will be sent out to the parties in the next few days. It will contain my understanding of the undertakings given to me. It will also detail the various clauses about which I sought clarification. It will not detail the responses that I have been given because those are recorded on the transcript if ever it were necessary to have regard to them. I will adjourn the matter on that basis.

ADJOURNED INDEFINITELY [2.20pm]