AG2005/3483, Transcript of Proceedings [2005] AIRCTrans 1155 (17 May 2005)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996 11481-1

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

AG2005/3483

APPLICATION BY ALUTEC CONSTRUCTION PTY LTD & CONSTRUCTION, FORESTRY, MINING AND ENERGY UNION-CONSTRUCTION AND GENERAL DIVISION, SA DIVISIONAL BRANCH
s.170LJ - Agreement with organisations of employees (Division 2)
(AG2005/3483)

ADELAIDE

11.35AM, FRIDAY, 06 MAY 2005

PN1

MR S DASHAN: I appear for Alutec Construction Pty Ltd.

PN2

MR A HARRIS: I appear on behalf of the CFMEU.

PN3

THE SENIOR DEPUTY PRESIDENT: Mr Harris, Mr Dashan is a legal practitioner. Have you got any objection to him appearing in this matter?

PN4

MR HARRIS: No, it's the one I have been mainly dealing with to do the actual documents so that's all right.

PN5

THE SENIOR DEPUTY PRESIDENT: I grant leave, Mr Dashan. Now, I can advise the parties that I have read the statutory declarations and I have read the agreement itself. There are a couple of questions I have about the statutory declarations. Mr Harris, if I refer to the declaration of Mr Garver, have you got that statutory declaration?

PN6

MR HARRIS: Yes.

PN7

THE SENIOR DEPUTY PRESIDENT: If I took you to paragraph 6.3 of that declaration, I note there are no numbers of total employees in the break up of those employees. Can I take it that you're in agreement with the information provided to me by the employer?

PN8

MR HARRIS: Yes, I tried a couple of times to actually get the number and it wasn't forthcoming but I knew the number was on the other side on the other document and I haven't seen the other stat dec. How many does it say?

PN9

THE SENIOR DEPUTY PRESIDENT: It indicates there are a total of 19 employees covered by the agreement and of that 19 the only one that falls into a category identified in that paragraph 6.3 is one casual employee.

PN10

MR HARRIS: Yes. I know the man personally. He attended the meetings as well and when this was done, when the final vote was taken people were around the table and I estimated 20 by the chair, so I am quite happy that the number would be 19.

PN11

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, Mr Dashan, the statutory declaration indicates that the relevant award for the purpose of the no disadvantage are the Building and Constructor Workers State Award and the Building Trades SA Award.

PN12

MR DASHAN: Yes, sir.

PN13

THE SENIOR DEPUTY PRESIDENT: The provisions of clause 5 of the award call up the federal National Building and Construction Industry Award, but should I understand that the employer in this case is not a respondent to that National Building and Construction Industry Award 2000?

PN14

MR DASHAN: Not at this time, Commissioner.

PN15

THE SENIOR DEPUTY PRESIDENT: But the effect of the agreement is that the parties propose to apply and adopt that award under the auspices of this agreement?

PN16

MR DASHAN: Those are my instructions, Senior Deputy President.

PN17

THE SENIOR DEPUTY PRESIDENT: Thank you. Well, that perhaps is the opportune time to take me to the questions that I have about the award. Now,
Mr Harris, I will direct my questions to Mr Dashan but you would well know that you can hop up and add to any of his responses.

PN18

MR HARRIS: If I feel got a couple of responses, yes.

PN19

THE SENIOR DEPUTY PRESIDENT: Mr Dashan, if I took you to clause 6 which is the dispute resolution procedure and in particular to 6.7. The reference is made there to reasonable conciliation. Is that at the discretion of the Commission or is that at the discretion of the parties?

PN20

MR DASHAN: Well, it would be my view that it would be at the discretion of the Commission given that I believe if there was no resolution to that matter at some stage it would stop and the issue was to make sure that we had an avenue to proceed to from that point on, so the parties have agreed that it's prepared to give the right of arbitration to the Australian Industrial Relations Commission, if it pleases the Commission

PN21

THE SENIOR DEPUTY PRESIDENT: Thank you. If I then took you to clause 8 which deals with wage rates and increases, I note that the last sentence in that clause indicates that those rates are inclusive of the 36 hour deviser. To that effect should I understand that to arrive at a weekly rate I would simply multiply those specified hourly rates by 36?

PN22

MR DASHAN: Yes.

PN23

THE SENIOR DEPUTY PRESIDENT: And clause 9 deals with productivity allowance. It talks about a productivity allowance of $1.50 per hour or greater if the principal site agreement provides for it. How should I understand the words principal site agreement?

PN24

MR DASHAN: As I understand it in the building industry, sir, my client is actually part of what is called the finishing trades. At the end of the day most large construction type work is in part covered by its own sometimes enterprise bargaining agreement arising out of the parties and in some of those situations a site agreement, as it used to be called, or an enterprise bargaining agreement covering certain work may in fact cover that site. It is agreed between the parties that if a site agreement exists and that site allowance provides for a figure higher than $1.50 an hour as a site allowance or a special rate allowance, then the parties have agreed that that will be the rate applicable. But in all other circumstances where that does not occur then the figure of $1.50 will apply.

PN25

THE SENIOR DEPUTY PRESIDENT: Do the parties understand that the principal site agreement will be an agreement certified by the Commission or could it be an unregistered agreement?

PN26

MR DASHAN: It's an expectation of course that the site agreement will be done that's registered by the Commission, but I will let my friend pipe in there.

PN27

THE SENIOR DEPUTY PRESIDENT: Mr Harris is looking very anxious in that regard. Mr Harris.

PN28

MR HARRIS: I thought save us going elsewhere, clause 12 has got the BIRST redundancy thing in there.

PN29

THE SENIOR DEPUTY PRESIDENT: I will look to that in a minute,
Mr Harris.

PN30

MR HARRIS: Yes. But the BIRST actually defines the value of a job to a site, that's what I am assuming, not being the writer of the document, that the principal, where is it, "The principal site agreement provides". What would that be is if the BIRST agreement has a higher amount when they're on a job then they get that amount.

PN31

THE SENIOR DEPUTY PRESIDENT: I see. So that the principal site agreement needn't necessarily be a certified agreement?

PN32

MR HARRIS: No.

PN33

THE SENIOR DEPUTY PRESIDENT: And hence it needn't necessarily be an agreement to which this particular employer is a party?

PN34

MR HARRIS: Yes, it would be because that's why I went to 12, because as a signatory to the BIRST agreement it has a scale in the agreement and which has an amount for the sites. So two ..... that I know that they're on at the moment, one there's a $1.25 site allowance as per the BIRST agreement, these chaps will get $1.50 and where they are down in Hymie Street, Built Environs project down there, the site allowance is $1.50 but with also 38 cents multi storey, so it's greater so they should be entitled to that.

PN35

THE SENIOR DEPUTY PRESIDENT: Yes. I don't want to labour the point but I would hate to see you people back in here with an argument over it. It seems to me that there are at least two potential circumstances under which an amount greater than $1.50 might be paid. One would be where this particular employer is working on a job with an overall cost which under the dictates of the unregistered BIRST agreement qualifies all employees working on that particular job for an amount in excess of $1.50.

PN36

MR HARRIS: That's on the track.

PN37

THE SENIOR DEPUTY PRESIDENT: The second would be if a principal contractor working on a job had entered into an agreement and that that agreement was reflected in tenders and such that this particular employer bid on the basis of compliance with that particular agreement and in the event that an amount of greater than $1.50 was provided for in that circumstance it seems to me the parties are saying that higher amount would be paid. Have I properly understood those two scenarios.

PN38

MR HARRIS: That is correct. That is still correct.

PN39

THE SENIOR DEPUTY PRESIDENT: All right, thank you.

PN40

MR HARRIS: Or it's still right anyway.

PN41

THE SENIOR DEPUTY PRESIDENT: Now, given that Mr Harris was so keen to take me to clause 12, I do need to go to that clause, Mr Dashan, and you have the dubious distinction of being, that I recall, the first parties to bring us
section 170LJ agreement to me for certification subsequent to the Commission's decision in Schafenacker which dealt with that range of issues that pertain or don't pertain. I have had a section 170LK agreement which has given rise to a similar set of questions to that which I want to put to the parties. Now, the obligation exists in clause 12 for the employer to enrol employees in that Building Industry Redundancy Scheme Trust.

PN42

The obligation exists in clause 12 for the employer to pay an amount which is specified in that particular clause and I should say I have noted that the amount is to be reduced, presumably by an unspecified amount in clause 13, relative to sickness, or injury and sickness insurance. I have no been provided with a copy of, or I now have a copy of the deed of trust for the South Australian Building Industry Redundancy Scheme Trust which was last amended, or my copy was last amended on 18 February this year, and I also have a copy of the South Australian Building Industry Redundancy Scheme Agreement. The issue that is causing me some concern is that I can see in the document an obligation on the employer to make payments to that redundancy scheme trust.

PN43

What I don't have before me that I can discern in any event easily is something that sets out what the obligation is on the redundancy scheme trust to make payments to an individual employee. So that I cannot easily on the information before me link the amount of money that clause 12 obligates the employer to pay with something that is a benefit to an individual employee and it may well be something. But it seems to me that becomes fairly critical in this process. If there isn't then there is a potential issue associated with how I can construe clause 12 as pertaining to the employment relationship.

PN44

MR DASHAN: Sir, if I may be of assistance. It is my view that the clause actually pertains to the relationship between employers and employees because on my understanding the employees actually sign up to the scheme. While the employer makes the application the employees are enrolled as beneficiaries to the trust of the BIRST scheme.

PN45

THE SENIOR DEPUTY PRESIDENT: That doesn't feature as a component of the information before me. The reason for setting out what information I have before me is not necessarily so you need so you need to answer the question now because it occurs to me that you and Mr Harris may need to put your heads together in terms of how you answer that question. I should stress that I am not setting out to try and trip up your agreement. But the Full Commission in Schafenacker makes it clear there is an express obligation on the Commission to ensure that the provisions of an agreement can be said to pertain to that employment relationship.

PN46

MR DASHAN: I understand.

PN47

THE SENIOR DEPUTY PRESIDENT: And hence I want to give the parties the opportunity to look at the documentation, possibly even to give me any additional information they may choose to give me. I have escaped for many, many years, as Mr Harris would know, having to pour over the Building Industry Redundancy Scheme Agreement. I think Schafenacker imposes an obligation on me to do just that. Having done so, it's only appropriate that I raise I this dilemma that I have in that I can't easily draw a link between this - on the information before me between the payments of an individual employer to that scheme and benefits the flow to an employee.

PN48

MR DASHAN: I understand your concern and what I would undertake is after having a discussion with my friend to provide you an explanation in writing to that particular query.

PN49

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Harris, do you have any questions about the issue that I am raising and as I said, I am not expecting you necessarily to answer those questions now?

PN50

MR HARRIS: Well, I will put a couple of things across to you and then if that's not satisfactory then I will follow that other track. The word redundancy, forget all the other words, the redundancy as per the award there's an entitlement to people being redundant. All the BIRST scheme for the employee does is a weekly amount, monthly payment I think 14th of each month, is paid into the trust for that employee, no-one else, for that employee when it becomes redundant. When you add the injury and accident to that that benefit is not paying for anyone else. It's the benefit that comes out of the figures and no doubt if you get the number 13 you might ask those questions, but from 1 July come out of the employee's entitlements to the redundancy will come out of that, but because the amount is up there the money is solely used now, and I assume that's why you have got the February one there, is the employer instead of keeping the worker's redundancy entitlement in a bank or in his pocket, he is actually putting in a trust account or an account for the employee when he signs off.

PN51

The two signings are if I came as a brand new worker and not currently in the BIRST scheme I would have a yellow form. I haven't seen one for a while because most blokes flow around the industry, but a yellow form that the employee himself signs into the BIRST. His employer will do it. The employer will give him the forms. He signs them so then he has an account number. I am not sure if the word is account but it's similar to that, an account number in the BIRST scheme. When the employer puts the money to the BIRST scheme, $45, four fours are 16, $180 for a four week month, he would send that in. The BIRST scheme puts that into the worker's account and the worker is terminated, leave, whatever those sort of cases are, the employer signs he has been with me X amount of weeks, the employee goes to Greenhill Road and withdraw his money, now with interest.

PN52

THE SENIOR DEPUTY PRESIDENT: Mr Harris, that information that establishes those obligation and that process may well address the issue that I am raising. All I am doing at this stage is indicating that having read through that South Australian Building Industry Redundancy Scheme Agreement and having read the redundancy scheme trust deed, that linkage doesn't appear to be an obvious one. So that what I am suggesting to the parties - - -

PN53

MR HARRIS: Well, I will then go back to what you originally wanted. You wanted to ask each party to do it, I will do that, but the employee will be squealing if he didn't get his money out of it.

PN54

THE SENIOR DEPUTY PRESIDENT: What I am suggesting is that the parties will need to have a look at the two documents to which I have referred and if there's any other document that locks in the linkage between the amount of money being paid by the employer and a defined or consequent benefit to the employee, then that information should be provided to me.

PN55

MR HARRIS: That should be in what you have got, isn't it?

PN56

THE SENIOR DEPUTY PRESIDENT: Well, Mr Harris, I - - -

PN57

MR HARRIS: I am not sure what you - you know, I am only looking over the desk there.

PN58

THE SENIOR DEPUTY PRESIDENT: All I can say to you is that I have got the trust deed, or the deed of trust, and that still leaves me struggling with these questions.

PN59

MR DASHAN: Sir, if I may be of assistance. I think what you have in front of you is a trust document. I would suggest that there would be rules of the trust which govern the functions of the trustee. All that the trust deed that you have in front of you will refer to the appointments of the trustees, there would be their rules that govern the trustees and who the beneficiaries of that particular trust will be. I think it might be prudent after speaking to my friend to actually get the rules of the trust in relation to payments and how that is actually facilitated. I am certain I have seen a document to that effect and it might be easier for us to forward that to you.

PN60

THE SENIOR DEPUTY PRESIDENT: Mr Dashan, should either you or
Mr Harris want to know exactly what I have got, then at the conclusion of the hearing if you ask my associate I am sure she will photocopy those documents for you. That at least will establish the benchmark in terms of the information already before me.

PN61

MR DASHAN: I appreciate that, Commissioner.

PN62

MR HARRIS: I will be happy just to look at them after then. I will know what they are and no doubt I have got them.

PN63

THE SENIOR DEPUTY PRESIDENT: Yes. Now, that then takes me to clause 13, Mr Dashan, and obviously my question in this regard is to some extent predicated on the earlier issue. But are you able to advise of the cost of the premiums associated with the injury and sickness insurance?

PN64

MR DASHAN: I don't have a precise figure, I must admit, but in relation to clause 13 this directly applies as a matter pertaining to a relationship between the employer and employees pursuant to clause 170LJ. I say that simply because that even prior to the contributions in clause 12 being made - - -

PN65

THE SENIOR DEPUTY PRESIDENT: The question I am asking here is not underpinned by a concern that that is not a pertaining provision. I am satisfied that it's a pertaining provision. The question I am simply asking is that the clause leaves aside the value or the monetary amount attaching to the cost of the premium.

PN66

MR DASHAN: Correct.

PN67

THE SENIOR DEPUTY PRESIDENT: And I am just wanting clarification of that.

PN68

MR DASHAN: And I can't give you the actual figure simply because at the time when this negotiated an agreement was reached between the parties that a scheme would be set up. It is my understanding a scheme has been set up since that time, however, I don't have a precise figure as to what the premiums are. I am prepared to find out what they are and refer them back to you.

PN69

THE SENIOR DEPUTY PRESIDENT: So when you provide me with the written information relative to clause 12 would you incorporate that in the response?

PN70

MR DASHAN: I shall.

PN71

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, clause 16 deals with the implementation of the 36 hour week. If I took you to the second paragraph, reference is made to any relevant site agreement. Should I understand that going back to the earlier matter being discussed, any relevant site agreement would be a site agreement which has application to a principal contractor who has entered into a contract with this particular employer where that site agreement is certified, first of all, and secondly, establishing arrangements relative to rostered days off under the 36 hour week?

PN72

MR DASHAN: I would expect that that would be either certified or a contractual term.

PN73

THE SENIOR DEPUTY PRESIDENT: Yes.

PN74

MR DASHAN: I mean it is not, in my experience, that any contractor, especially one in the finishing trades, is prepared to pay additional moneys if it wasn't a contractual term in the first instance.

PN75

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Harris, you're in agreement with that?

PN76

MR HARRIS: Yes, yes.

PN77

THE SENIOR DEPUTY PRESIDENT: And if I then took you to the second last paragraph in that particular clause 16, Mr Dashan, reference is made there to discussions between the employer and the CFMEU. Do I understand that those discussions will also involve individual employees?

PN78

MR DASHAN: Yes, it will.

PN79

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Dashan. Mr Harris, I have worked on the basis that you have inserted your comments where you found that necessary, otherwise you agree with Mr Dashan?

PN80

MR HARRIS: I did have two other comments of what we raise.

PN81

THE SENIOR DEPUTY PRESIDENT: Yes, I am in your hands.

PN82

MR HARRIS: And 14 talks about the ordinary hours and 16 which is the implementation, so 16 is one that I explained. The dot points there are part of the 36 hour, one day in conjunction with some days that are gone, Australia Day, Easter, Anzac. They are part of the 36 hour because on those times there's also a day off for the 38 hour, so in those instances - - -

PN83

THE SENIOR DEPUTY PRESIDENT: It will be four day weekends on some of those dates.

PN84

MR HARRIS: Yes. And so that's why you raised, I think it's the second paragraph down, about a site agreement or whatever that happens there, that if the company has some sort of contractual thing or agreement with the employer that another day is there as well. These lads won't be there. They will have part of their non fixed days off.

PN85

THE SENIOR DEPUTY PRESIDENT: Yes.

PN86

MR HARRIS: The other one I was just going to go back to, you said about the wages - sorry, Commissioner. Back in 8 in the wages we had the above rates are inclusive of the 36 hour deviser, that is the case. So out of those $20, eight hours, per week, then instead of taking it's work full, so in the same conjunction with the 14 that I said, that the employee works a full 40 hours and gets the ordinary time, it will now be four hours are taken out instead of two so that when they do have the 36 and the 38 - - -

PN87

THE SENIOR DEPUTY PRESIDENT: Yes, the accrual system applies so that the rostered days off are paid for.

PN88

MR HARRIS: That is correct, with the allowances and that, because it doesn't quite read as easy as it sounds. They were the only two things I wished to add.

PN89

THE SENIOR DEPUTY PRESIDENT: Can I just clarify that then. In terms of 9, which is the productivity allowance, is the $1.50 paid for every hour worked?

PN90

MR HARRIS: That's actually why I said it and what would happen there is, going to the 14, where it says upon ..... shall not attract an entitlement to ..... it means that those four hours would not be paid at overtime rates, but if you had that $1.50 which makes 40, which makes $60 worth a week, you would take four hours off of that and you get that on the rostered day off. So you don't get extra on a rostered day off but the employee will only get 36 $1.50s per week.

PN91

THE SENIOR DEPUTY PRESIDENT: I see.

PN92

MR HARRIS: That's why I thought there would be a confusion, because that line means is though, apart from a casual employee that doesn't have a rostered day off, they will not be getting overtime rates for those other four hours.

PN93

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Dashan, I presume you're in agreement with Mr Harris?

PN94

MR DASHAN: Yes, I am. We have more than a few debates about that.

PN95

MR HARRIS: That's why I thought I would get it here.

PN96

THE SENIOR DEPUTY PRESIDENT: Mr Dashan, how long will you need to provide that information to me? I should stress I am in no mad hurry for it and I am in your hands in that regard.

PN97

MR DASHAN: I would like to get this matter completed as soon as possible. The negotiations have been long and tedious. I would propose at this stage that I think that the issue that you have raised in relation to the BIRST scheme is one that can be settled fairly quickly, if in fact my friend and I can actually get our hands on some rules of the trust fund and if that solves our problem we should be able to come back early next week, Senior Deputy President.

PN98

THE SENIOR DEPUTY PRESIDENT: All right. Well, I won't require you to come back. If I provide a one week period in which the parties can provide written material should either party request a further hearing in the matter I am happy to assent to that request, otherwise I will simply work from the documentation provided to me. I can indicate to you now that I am satisfied that the agreement was reached through a process consistent with section 170LJ of the Act and that I can also indicate that I am satisfied that the agreement meets the requirements set out in sections 170LT and LU of the Act.

PN99

Accordingly if the information to be provided to me with respect to clauses 12 and 13 allows me to conclude that the requirements of section 170LI have been met, I would propose to certify the agreement from the date upon which I received that information.

PN100

MR DASHAN: Thank you, Commissioner.

PN101

THE SENIOR DEPUTY PRESIDENT: In the event that I have a problem in that regard, in terms of the information to be provided to me, I will consider whether or not there is benefit in asking you to come back and provide me with further information.

PN102

MR DASHAN: If it pleases the Commission.

PN103

THE SENIOR DEPUTY PRESIDENT: Are you happy with that approach,
Mr Harris?

PN104

MR HARRIS: Yes, thank you.

PN105

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

<ADJOURNED INDEFINITELY [12.05PM]