AG2004/7322, Transcript of Proceedings [2004] AIRCTrans 4377 (12 November 2004)

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TRANSCRIPT OF PROCEEDINGS

O/N 1001

AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

DEPUTY PRESIDENT McCARTHY

AG2004/7322

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LJ of the Act
by Perth Jewish Aged Home Society Inc for
certification of the Perth Jewish Aged Home
Society Inc Registered Nurses Agreement 2004

PERTH

10.06 AM, WEDNESDAY, 3 NOVEMBER, 2004

PN1

MS M. KUHNE: I appear for the applicant in this particular matter.

PN2

THE DEPUTY PRESIDENT: Yes, thank you.

PN3

MS C. NOBBS: I appear on behalf of the Australian Nursing Federation.

PN4

THE DEPUTY PRESIDENT: You are seeking leave to intervene, are you?

PN5

MS NOBBS: Seeking to be bound, yes.

PN6

THE DEPUTY PRESIDENT: So you're seeking to intervene as well, or just seeking to be bound, or both?

PN7

MS NOBBS: Seeking to be bound.

PN8

THE DEPUTY PRESIDENT: Yes. Do you have any comment about that?

PN9

MS KUHNE: We have no objection to the ANF being bound provided they meet the prescribed forms and we understand that they do.

PN10

THE DEPUTY PRESIDENT: Yes. Well they've lodged the appropriate documentation and everything would appear to be in order in that regard, Ms Kuhne. So should the agreement be certified then I am obliged to issue an order that the ANF be bound.

PN11

MS KUHNE: Thank you, sir.

PN12

THE DEPUTY PRESIDENT: Yes, Ms Kuhne, you take me through this. I did circulate a report and I think there's been replacement statutory declarations lodged, the initial ones not having been complete, I don't think. There are a number of issues that I ask be addressed.

PN13

MS KUHNE: Yes, thank you sir. We have received your report with those questions. We sir, do say that the agreement does comply with all of the requirements. In respect of the 14 day period, we do notice that you've asked a question in respect of that provision. While we accept that looking at Mr Bahns stat dec the period of notice that was given, was only a period of 14 days in total and not exclusive of the day on which the notice was given. We do firstly say that all of the circumstances are precisely those of Boom - in Boom Logistics at PR951366 sir, a decision of yours.

PN14

And we submit that the Commission should deal with this matter in precisely the same way as you dealt with the matter in relation to Boom, and that is sir, that section 111(1)(q) should indeed be used to rectify any defect in the process, in order not to hold up the certification of this agreement, which is an agreement which had the unanimous support of all employees, and over which there has been considerable consultation over a period of a number of months.

PN15

Sir, there's also further support for this submission because, although Mr Bahn's statement doesn't mention the fact, the 14 day period mentioned in the stat dec, that is, I think, going from the 11th to 25 August, I'm just finding it, 2004, that in fact was a second period of 14 days because of a fault that had been picked up in relation to the first period of 14 days. The employer did in fact notify the employees and did provide them with a period of 14 days, but did not comply with section 170LK(4).

PN16

So, didn't provide the appropriate notice and as a result when that was picked up, they rectified the problem and provided each employee with exactly the same copy of the agreement, exactly the same agreement, for a further period of 14 days and that further period of 14 days was in fact the period of 11th to 25 August, to meet the requirements of section 170LK(4). So, I suppose it could be said that they had in fact a period of 14 - 28 days of having the very same agreement in front of them. Now I accept that the stat dec doesn't actually say that but - - -

PN17

THE DEPUTY PRESIDENT: But in fact you're saying they did have the agreement for more than the requisite 14 days and that reasonable steps were in fact taken to ensure that they did have that.

PN18

MS KUHNE: That's right.

PN19

THE DEPUTY PRESIDENT: That they received a second copy of the agreement at a later time.

PN20

MS KUHNE: That's right.

PN21

THE DEPUTY PRESIDENT: I see. Well, then it appears to have been met then, Ms Kuhne.

PN22

MS KUHNE: Yes, that's right. I would say that the requirements had in fact been met.

PN23

THE DEPUTY PRESIDENT: Yes. I am satisfied in that regard.

PN24

MS KUHNE: Thank you for that, sir.

PN25

THE DEPUTY PRESIDENT: No, I don't think there is any need to use any of the provisions of section 111(1). The requirement has been met.

PN26

MS KUHNE: Thank you, sir. Now, there was one other question I think sir, that you raised and that was in relation to salary packaging. I think because of the affect of the Electrolux decision.

PN27

THE DEPUTY PRESIDENT: Yes.

PN28

MS KUHNE: We would submit simply sir, that although I'm not aware of any decision that clearly disposes of this particular matter, in relation to salary packaging, but we would submit that it is clearly a matter that does pertain to the employer/employee relationship because salary packaging in accordance with the terms of appendix A, is an agreement between an employee, if the employee so chooses and the employer in relation to the details of their salary packaging - their own personal salary packaging arrangement, and we would say that that clearly is a matter that does pertain to the employer/employee relationship.

PN29

THE DEPUTY PRESIDENT: What does it actually entail? What does the package actually entail? What happens?

PN30

MS KUHNE: Well, as I understand it, they - the employees have the right to package or to - yes, to package 30 percent of their salary. In fact it's quite generous, because it means that they can package up to a maximum of $30,000 in grossed up value of their salary, and enter into an arrangement whereby they forego, well in fact the employer doesn't forego anything, they have this access to salary to items that are included in the salary packaging policy that the employer has, which in fact I don't have available to me, although I can get hold of a copy of that and provide it to the Commission. But they have, as I understand it, they have a list of items that can be packaged, in accordance with the arrangements that the employer has with the tax department and they can enter into those into a - - -

PN31

THE DEPUTY PRESIDENT: But does it mean that monies are withheld from the salary that is payable to the employee, the money is withheld by the employer and then those monies that are withheld are paid to third parties, or paid as contributions to a superannuation fund, or things of that nature. Is that what it means?

PN32

MS KUHNE: There are - in fact, the agreement under the salary clause, I think it's clause 7 of the agreement, clause 7 of the agreement, wages subclause 3, does actually specify that an employee may elect to forego a percentage of the weekly wage which does, I guess, mean that it is a salary, that it is in fact a salary sacrifice arrangement.

PN33

THE DEPUTY PRESIDENT: Where is that again?

PN34

MS KUHNE: That's - it's actually on page 5 I think, of the agreement. It's under clause 7, subclause 3, at the top of page 5 of the agreement.

PN35

THE DEPUTY PRESIDENT: Yes, I see, yes.

PN36

MS KUHNE: So, that arrangement does suggest a foregoing of a percentage, that's right, so that is in fact a salary sacrifice arrangement so that the employee would in fact, yes, sacrifice a certain percentage for other benefits and, as you say, some of those would be - - -

PN37

THE DEPUTY PRESIDENT: Yes, what I'm trying to distinguish is what if one of the - what if the salary foregone is a, if it's payment to a third party doesn't it obtain the character of deduction of union dues. The relationship is then between the employee and whoever is being paid on behalf of the employee by the employer.

PN38

MS KUHNE: And in this particular case I'm not sure whether there is a third party involved, I understand that that is quite common, that it is a reasonably common practice whereby there is a third party involved. I don't know if it was in this case, and I suppose at the outset it is up to the employee as to whether they elect to package and thereby sacrifice a portion and - - -

PN39

THE DEPUTY PRESIDENT: But that's no different to deduction of union dues.

PN40

MS KUHNE: True, true. Except that in relation to deduction of union dues, it is clearly the union which profits from the decision made by the employee. In this case - - -

PN41

THE DEPUTY PRESIDENT: What's the difference between whether it's a union, or any other provider of service to the employee.

PN42

MS KUHNE: Except that in the case of salary packaging, the employee has made an arrangement with the employer. The employer is still offering an opportunity for the employee to benefit by way of a salary package, by way of a reward for their efforts, it is still part of their wage, part of their salary, that they are - - -

PN43

THE DEPUTY PRESIDENT: They're paid in a different form.

PN44

MS KUHNE: Paid in a different form, I accept - - -

PN45

THE DEPUTY PRESIDENT: But it's not paid to them at all.

PN46

MS KUHNE: But the employee is benefiting from it.

PN47

THE DEPUTY PRESIDENT: Yes, well they might benefit from deduction of union dues.

PN48

MS KUHNE: Except that in the case of deduction of union dues, the - you would have to - well, I would argue that the employee is not a direct beneficiary of that arrangement. The direct beneficiary is the union.

PN49

THE DEPUTY PRESIDENT: But the employee is the - on the assumption that union's provide services, Ms Kuhne the employee is the beneficiary.

PN50

MS KUHNE: Sure, but that - - -

PN51

THE DEPUTY PRESIDENT: You provide services don't you Ms Nobb?

PN52

MS KUHNE: In the sense that it's not as direct is what I'm saying. In the case of a salary packaging arrangement, the employee is directly affected in terms of how they receive their benefits. They elect - if they elect to take up that arrangement, they are - - -

PN53

THE DEPUTY PRESIDENT: I'm not trying to be difficult, I just want to make sure that anything I certify is an agreement that is capable of certification.

PN54

MS KUHNE: I have tried to find other decisions where I thought this might have been raised, and I haven't found any, to see whether there have been other views that have been put on the matter, and I haven't. I'm certainly prepared to talk to our member about the exact arrangements that they enter into in relation to the salary packaging.

PN55

THE DEPUTY PRESIDENT: Yes. I think I'm going to require that. I'll need that if you can provide that to me in due course. That was the only issue. If there's anything further you wish to put in regard to that, given the questions I've raised, Ms Kuhne, you can put those in writing if you wish. I'm not directing that you do, but if you want to avail yourself of that opportunity, you can. Is there anything further you wish to put?

PN56

MS KUHNE: No, sir. Those are really my submissions.

PN57

THE DEPUTY PRESIDENT: Yes.

PN58

MS KUHNE: I would simply request that the agreement do be certified in that the requirements of the Act have been met and the agreement was unanimously supported by each and every employee.

PN59

THE DEPUTY PRESIDENT: Yes. Thank you. Ms Nobbs, you simply - you have no comment about the content of the agreement, you simply wish to be made bound by the agreement.

PN60

MS NOBBS: Yes, that's correct.

PN61

THE DEPUTY PRESIDENT: Yes, well that will occur should the agreement be certified. I will adjourn the proceedings. Ms Kuhne, can you ensure that you provide me with those details as soon as you can.

PN62

MS KUHNE: Yes. I'll provide that assurance thank you, sir.

PN63

THE DEPUTY PRESIDENT: Yes, this matter is adjourned.

ADJOURNED INDEFINITELY [10.20am]