AG2004/8236, Transcript of Proceedings [2004] AIRCTrans 4992 (21 December 2004)

AUSCRIPT AUSTRALASIA PTY LTD
ABN 72 110 028 825

Level 7, ANZ House 13 Grenfell St ADELAIDE SA 5000
Tel:[phone] Fax:[phone]

TRANSCRIPT OF PROCEEDINGS

O/N 2629
AUSTRALIAN INDUSTRIAL

RELATIONS COMMISSION

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

AG2004/8236

APPLICATION FOR CERTIFICATION
OF AGREEMENT

Application under section 170LJ of the Act
by Kimberly Clark Australia Pty Ltd and Others
for certification of the Kimberly-Clark Australia
Lonsdale Mill Enterprise Agreement 2004

ADELAIDE

2.18 PM, FRIDAY, 10 DECEMBER 2004

PN1

MR J.G. WILLIAMS: I appear on behalf of Kimberly-Clark Australia Pty Ltd and with me is MR G. BARTEL.

PN2

MS M. PORTSMITH: I appear on behalf of Stephen Brennan for the Textile, Clothing and Footwear Union.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you. I can advise the parties that I've read the statutory declarations and I've read the agreement so that unless the parties want to say anything particular to me about the process whereby the agreement was reached, I don't have any questions about that process of consultation with employees. I do have a fundamental question of the parties that you may or may not be able to answer today.

PN4

The parties have made this application pursuant to division 3 of Part VIB of the Act. Now, division 3 of Part VIB of the Act deals with the making of agreements about industrial disputes and industrial situations. It might help if I comment that division 2 simply deals with the making of agreements with constitutional corporations or with the Commonwealth.

PN5

Unlike division 2, division 3 requires that the Commission must be satisfied that the dispute - sorry - that the agreement either settles, further settles, or maintains the settlement of, or prevents an industrial dispute, or prevents an industrial situation from giving rise to an industrial dispute. In this matter the statutory declarations from the parties refer to and rely upon a dispute finding in C No 31540 of 1993.

PN6

Now, that dispute finding is relied upon as the basis upon which the application is made under division 3 of Part VIB. In that matter number, that is C 13540 [sic] of 1993, the information that I have from the Commission's file indicates that Commissioner Lewin found a dispute on 7 February 1994. That dispute finding related to the National Union of Workers. I can't see any reference in that dispute finding to the Textile, Clothing and Footwear Union.

PN7

Furthermore, I can't see any reference in that dispute finding to Kimberly-Clark, so I'm in a position where I'm wondering whether the parties have correctly identified an appropriate dispute finding. There are a couple of ways whereby this might be addressed. It is clear that unless the parties can address that matter today, I'm not going to be in a position to certify the agreement today, but it might be a matter the parties want to provide written advice on.

PN8

The option exists for the parties to identify how that particular C No 31540 of 1993 does in fact involve the TCFUA and Kimberly-Clark. Alternatively, the parties might identify a different dispute finding which involves the both of them. Perhaps before doing so they might want to check that that dispute finding, in effect, establishes the ambit within which this agreement could operate.

PN9

There is a third alternative available to the parties and, that is, provided the parties don't set out to change any provision of this particular agreement - which is a matter I will get to a little later - the capacity exists for the parties to collectively seek to advise that they wish to change the jurisdictional basis upon which the application is made so as to instead rely on division 2 of Part VIB.

PN10

The reason that I'm prepared to accept such change is twofold, firstly and most significantly, the process whereby the agreement is made is fundamentally the same, that is, the union and the employer reach an agreement, that agreement is to be made available to and explained to employees with a requisite period of notice and, thirdly, that agreement is then to be endorsed by a valid majority of employees so that I see little difference in the process set out in section 170LR of the Act to the process set out in section 170LJ.

PN11

The second reason that I'm inclined to allowing parties to make this change is that my experience is that particularly post the High Court decision in Electrolux, a great many parties have made division 3 applications because they have always done so, rather than necessarily asking themselves the question as to whether or not this is in fact an agreement about an industrial dispute, or an industrial situation.

PN12

It appears to me that section 170LA of the Act obligates the Commission to do everything it can to facilitate the making and the certification of agreements and, hence, if the parties did choose to come back to say that they wished to change the jurisdictional basis upon which the application is made, I will give that appropriate consideration. Now, all of that was intended to say, I have a problem with the jurisdictional basis. Either of the parties might choose to address that problem right now, if you are equipped to do so.

PN13

MR WILLIAMS: Senior Deputy President, I would suggest that the number quoted has been done incorrectly and inadvertently. There has been a number of dispute findings between Kimberly-Clark at its Lonsdale Mill and the TCFUA on which enterprise agreements have been based. However, given what the Commission has said I would be more than comfortable if we could seek for certification under division 2, if the Commission believes that that would be successful.

PN14

THE SENIOR DEPUTY PRESIDENT: Yes. You need not advise me of a confirmed position in that regard today, Mr Williams. It might be something that you want to talk to the union about before you finalise the provision. I'm happy to be advised in writing over the next few days.

PN15

MR WILLIAMS: Thank you, sir.

PN16

THE SENIOR DEPUTY PRESIDENT: I should say that the reference to 31540 of 1993 is a reference in the union's statutory declaration. Looking at the first statutory declaration, yes, it is similarly reflected. If I can then take the parties to the agreement itself and, Ms Portsmith, I'm going to address my questions to Mr Williams, but I need to make it clear that I'm not inviting Mr Williams to re-write the document at all.

PN17

My questions simply go to issues of clarification in relation to the provisions of the agreement of the matters that I will need to take into account. If you, Ms Portsmith, want to comment on any of Mr Williams's responses, please feel free to hop up and so do. Mr Williams, can I take you first of all to the provisions of clause 7 the: Scope And Duration of the Agreement.

PN18

Can I clarify to who the agreement applies? It seems to me that the potential exists for me to read clause 7 as meaning that the agreement applies to Kimberly-Clark Australia Pty Ltd as the employer and to employees at the Lonsdale plant who are members of the Textile, Clothing and Footwear Union of Australia. Is that the case?

PN19

MR WILLIAMS: It is intended to apply to all employees that are - for want of a better description - non-staff employees at the Lonsdale site, Senior Deputy President. Currently they are represented by the Textile, Clothing and Footwear Union.

PN20

THE SENIOR DEPUTY PRESIDENT: Yes. Does it actually say that anywhere in clause 7, or is that simply the intention of the parties?

PN21

MR WILLIAMS: I believe that is the intention of the parties.

PN22

THE SENIOR DEPUTY PRESIDENT: Should I understand then that all employees voted on the agreement, irrespective of whether or not they were members of the union?

PN23

MS PORTSMITH: Sorry, that is 100 per cent union so it is - - -

PN24

MR WILLIAMS: My understanding is they are all members of the union, Senior Deputy President.

PN25

MS PORTSMITH: Yes.

PN26

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, but union membership is not taken into account.

PN27

MR WILLIAMS: The employees on shift were asked to vote but, again, I understand there are no non-TCFUA members there.

PN28

THE SENIOR DEPUTY PRESIDENT: So that if I look then at clause 7:

PN29

If an employee who is currently a member of the union resigned from the union.

PN30

Would the agreement still be applied to that person?

PN31

MR WILLIAMS: As far as Kimberly-Clark is concerned, yes, Senior Deputy President.

PN32

THE SENIOR DEPUTY PRESIDENT: Can you give me an undertaking in that respect?

PN33

MR WILLIAMS: Absolutely.

PN34

THE SENIOR DEPUTY PRESIDENT: That undertaking would be requested and provided pursuant to section 170LV and is designed to address a concern that I have that in accordance with section 170LU and, in particular LU(2)(a), the provisions of clause 7 could be seen to be - to create a difficulty in terms of the application of the freedom of association provisions, such that without that undertaking, resignation by an employee from the union might otherwise be seen to disadvantage that employee.

PN35

MR WILLIAMS: No employee in that situation would be disadvantaged, Senior Deputy President.

PN36

THE SENIOR DEPUTY PRESIDENT: Thank you. If I can then take you to clause 8, to the heading "first increase". Should I take it the parties intend to refer to appendix 1 rather than appendix 2?

PN37

MR WILLIAMS: That is correct, sir.

PN38

THE SENIOR DEPUTY PRESIDENT: There is a further heading called "service bonus". Is that service bonus in particular the bonus to apply on the anniversary of the, presumably, the employee's 16th year and subsequent years, specified anywhere in the agreement?

PN39

MR WILLIAMS: I'm sorry, sir. I don't know.

PN40

THE SENIOR DEPUTY PRESIDENT: The clause refers to a service bonus. Is the quantum of that bonus specified anywhere?

PN41

MR WILLIAMS: Only in the third paragraph where it eludes to, previously, the one week's annual leave that was granted. The service bonus is a provision of policy of Kimberly Clark, and it is detailed in that policy who it applies to. At the current time, that is the equivalent of one week's salary.

PN42

THE SENIOR DEPUTY PRESIDENT: I see. And should I understand then that that policy is readily available to employees?

PN43

MR WILLIAMS: Yes, sir.

PN44

THE SENIOR DEPUTY PRESIDENT: And further, that it might be changed during the life of the agreement?

PN45

MR WILLIAMS: Yes, it may be changed, but it has not changed for some period. We would understand that the provisions for the associates of Lonsdale would continue to be dictated by their enterprise agreement.

PN46

THE SENIOR DEPUTY PRESIDENT: So notwithstanding the service bonus concept will be applied, consistent with the enterprise agreement, the capacity does exist for the quantum of that bonus to be changed during the life of the agreement?

PN47

MR WILLIAMS: Yes, Senior Deputy President.

PN48

THE SENIOR DEPUTY PRESIDENT: Clause 9(b), on page 7, refers to company rules and regulations. Are those rules and regulations in a written form? Are they also readily available to employees, and may they be changed during the life of the agreement?

PN49

MR WILLIAMS: Yes, they may change during the life of the agreement. The rules are freely available. They are part of training packages that occur for the associates. They are dependent upon state regulatory and equipment operation and modification. So yes, they may change.

PN50

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 10 relates to the use of the agreement. Now, is that simply intended to be an obligation on both the union and the employer, or should I take it that it is intended to represent an obligation on any third party?

PN51

MR WILLIAMS: The union and the employer.

PN52

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 11(i)(a), in fact, the last paragraph on page 7: references on annual salary. The Act requires that I have regard to the no disadvantage test. Can you help me in terms of how the parties propose that I apply that no disadvantage test in the context of the annualised salary arrangement?

PN53

MR WILLIAMS: Senior Deputy President, their annualised salary is in excess of award provisions, as I understand it. The clause is intended to address an issue which, through the rosters may lead to an anomaly between shifts, whereby one of the three shifts may work a shift more than the other two shifts due to the public holidays or the annual leave provisions that are included in the agreement.

PN54

THE SENIOR DEPUTY PRESIDENT: Clause 13 deals with casual fixed period and part-time labour. It states that: a base rate which is no less than the equivalent award rate will be paid during the life of this agreement. Is that base rate specified anywhere in the agreement?

PN55

MR WILLIAMS: Not in this agreement. No.

PN56

THE SENIOR DEPUTY PRESIDENT: I see. So that what the parties are saying there is that they will ensure that at least the award rate is paid in terms of casual employees, or employees hired for fixed periods of time?

PN57

MR WILLIAMS: That is correct.

PN58

THE SENIOR DEPUTY PRESIDENT: In relation to part-time employees. Do they receive a pro-rata amount of the full-time rate specified in this agreement?

PN59

MR WILLIAMS: Senior Deputy President, we currently have no part-time employees, nor have we had any at Lonsdale, to my knowledge. The intention would be that they would paid pro-rata to all entitlements to a full-time employee under the agreement.

PN60

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 14, once again references the annualised salary. Now, the issue that I'm alluding to here is, how it is that you say to me that I can look at the requirement that employees work on certain days of the year, which include public holidays and, at times, shift arrangements? I should also say, potentially, weekend work, and be assured that the annualised salaries set out in this agreement are at least equal to those rates that the employee would have got had they been working under the award?

PN61

MR WILLIAMS: Commissioner, when we set the annualised salary, part of that process was to break it apart and pay public holidays and shift allowances at the appropriate penalty rate. They were then rolled back into an annualised salary, so that if - under the shift pattern as it exists, no employee is required to work on a weekend, except for their normal shift arrangements. Except it be overtime, which is paid at an overtime rate, included in appendix 1.

PN62

THE SENIOR DEPUTY PRESIDENT: I see. How are public holiday working arrangements structured? That is, is it conceivable that one employee would need to work on all of the public holidays in any one year?

PN63

MR WILLIAMS: The agreement allows for half of the public holidays to be included in the annualised salary, and half of them not. Under the normal shift rostering arrangements, all three shifts would work on any one day, and so no one particular shift would work any more public holidays than any other particular shift.

PN64

THE SENIOR DEPUTY PRESIDENT: Thank you. You have probably given me enough there to allow me to do my homework on the agreement in that respect. Clause 20 deals with leave. Once again, it refers to company policies. Am I correct in understanding that those policies are all documented and readily available to employees and subject to change through the life of the agreement?

PN65

MR WILLIAMS: They are, Senior Deputy President.

PN66

THE SENIOR DEPUTY PRESIDENT: Clause 22 deals with salary continuance. The same question applies to the company policies referred to in that regard?

PN67

MR WILLIAMS: It does, sir.

PN68

THE SENIOR DEPUTY PRESIDENT: If I look at clause 24, which is the settlement of disputes procedure, with particular reference to sub-clause (d) and (e). Should I understand that, because of the reference to conciliation and arbitration in sub-clause (e), that the parties would expect that any dispute referred to the Commission would be the subject of conciliation, with arbitration as a last resort?

PN69

MR WILLIAMS: That is correct.

PN70

THE SENIOR DEPUTY PRESIDENT: Sub-clause (g) requires that I ask a further question relative to union membership. Notwithstanding that all employees might currently be members of the union, in the event that an employee was not a member of the union, does the capacity exist for that employee to be represented by a person or an organisation of their choice?

PN71

MR WILLIAMS: It does, Senior Deputy President.

PN72

THE SENIOR DEPUTY PRESIDENT: Thank you. The same question applies relative to clause 25, which is the discipline clause. Can I take it that an employee could be represented by a person of their choice?

PN73

MR WILLIAMS: That is correct.

PN74

THE SENIOR DEPUTY PRESIDENT: A similar question arises relative to the appendix 3 and the constitution of the consultative committee, with particular regard to clause 4. Does the extent to which a person is not a member of the union, represent a significant factor in terms of membership of that committee? That is, is there the capacity for someone who may not be a member of the TCFUA to be a member of that committee?

PN75

MR WILLIAMS: Senior Deputy President, the membership of the committee, except for management representatives, is voted on by the associates at Lonsdale. No restriction on the membership, from the company's point of view, is placed on who may or may not sit on that committee.

PN76

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Williams. Now, Ms Portsmith, do you want to comment on any of the responses that Mr Williams has given me, or can I take it that you are in agreement with him?

PN77

MS PORTSMITH: We are in agreement. Yes.

PN78

THE SENIOR DEPUTY PRESIDENT: All right. Now, how long do you think, Ms Portsmith, the union might need to consider this question of the jurisdictional basis upon which the application is made?

PN79

MS PORTSMITH: I think we will be in agreement. I think we are all under the impression that there has been a slight mistake.

PN80

THE SENIOR DEPUTY PRESIDENT: Well, if I gave the parties, say, a week in which to advise me of that position, would that be convenient?

PN81

MS PORTSMITH: That is plenty of time. Yes.

PN82

THE SENIOR DEPUTY PRESIDENT: Mr Williams, are you happy with that approach?

PN83

MR WILLIAMS: Yes. Very much so, Senior Deputy President.

PN84

THE SENIOR DEPUTY PRESIDENT: All right. Now, on the basis of the information provided to me I will review the agreement, so as to satisfy myself that that no disadvantage test is met. If the parties provide me with an alternative dispute finding upon which I can rely, so as to establish the ambit and the jurisdiction in accordance with division 3, then I can indicate to you now that I am satisfied that on the information given to me, the agreement has been reached through a process consistent with that outlined in that particular division.

PN85

On the other hand, if the parties advise in written form of their agreed position, such that they wish to rely on division 2, then I am satisfied that this agreement deals with matters that pertain to the employment relationship, and was reached through a process which could be described as consistent with section 170LJ of the Act. That means that I am indicating to the parties that subject to the provision of that additional information, I can be satisfied that the application before me is a valid application for certification.

PN86

Sections 170LT and LU detail the other considerations that I must have regard to. I am satisfied on the basis of the information provided to me by Mr Williams, that section 170LU does not represent an impediment to certification. On the basis of the information given to me, it is unlikely that section 170LT will represent such an impediment, but if I ran into difficulties in terms of the application of that no disadvantage test, then I will call the matter back on, and see whether the parties can enlighten me.

PN87

If then I am satisfied that all of the pre-conditions necessary for certification have been met, then I will endeavour to certify the agreement from the date upon which I receive advice about the jurisdictional basis for the application. If that is the case, then I would issue a certificate which would detail the various questions that I have sought, and refer the parties to this transcript.

PN88

MR WILLIAMS: Senior Deputy President, if I may?

PN89

THE SENIOR DEPUTY PRESIDENT: Mr Williams?

PN90

MR WILLIAMS: I could supply that dispute notification number by reference to my computer, which I have in my bag, if that would be of assistance?

PN91

THE SENIOR DEPUTY PRESIDENT: Well, I'm conscious, Mr Williams, that I would be anxious that it be a collective response. This might well be a case of more haste less speed, and hence, I'm quite happy with the parties having the opportunity - I will give you a week in which to do that, but if you manage to do it earlier, then I will try to get to look at the agreement earlier. At the conclusion of the hearing, if you see my associate, she will give you an e-mail address which might expedite consideration of the matter. Are you happy with that approach, Mr Williams?

PN92

MR WILLIAMS: Very much so, Senior Deputy President.

PN93

THE SENIOR DEPUTY PRESIDENT: Ms Portsmith?

PN94

MS PORTSMITH: Yes, thank you.

PN95

THE SENIOR DEPUTY PRESIDENT: Very well. I will adjourn the matter on that basis.

ADJOURNED INDEFINITELY [2.45pm]