C2005/2986, Transcript of Proceedings [2005] AIRCTrans 1234 (31 May 2005)

1800 534 258

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 11640-1

COMMISSIONER LEWIN

C2005/2986

AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION
AND
KAAL AUSTRALIA
s.99 - Notification of an industrial dispute
(C2005/2986)

MELBOURNE

3.01PM, THURSDAY, 19 MAY 2005

PN1

MR M ADDISON: I appear on behalf of the Australian Manufacturing Workers' Union, together with MR A SCOTT and delegates from the site.

PN2

MR G COOPER: I seek leave to appear for the respondent and with me is
MS L CRAVEN, MR P HESTER from the company.

PN3

THE COMMISSIONER: Thank you. Any objection to that, Mr Addison?

PN4

MR ADDISON: Commissioner, for the purposes of today, I don't object. However, I do reserve my right if the matter proceeds beyond today, if that is acceptable to you, Commissioner.

PN5

THE COMMISSIONER: Yes, well, it does present some problems. What is the distinction, I guess, between today and tomorrow?

PN6

MR ADDISON: Well, I don't want to hold it up. This is a section 99. I don't necessarily believe that counsel should be given leave to intervene in basic section 99s. Section 42(3) doesn't really envisage that, in my view.

PN7

THE COMMISSIONER: It depends on the subject matter of the dispute, I think, doesn't it?

PN8

MR ADDISON: Yes, Commissioner, that is right, but I don't want to hold today's proceedings up, so I don't object for the purposes of today so that we can get the thing dealt with hopefully, but if it goes to a position where there might be argument on a section 170LW or whatever, then I might have a different view.

PN9

THE COMMISSIONER: That is puzzling, because it seems to me that if the issues were jurisdictional, I would be more inclined to consider positively representation by counsel, whereas if they are more industrial in nature, I would be less inclined.

PN10

MR ADDISON: I think the dispute before you is industrial in nature, although there are some technical aspects to it. Commissioner, I withdraw my objection. Let's just proceed.

PN11

THE COMMISSIONER: All right.

PN12

MR ADDISON: Commissioner, the matter that is before the Commission today is an argument between the parties with regard to the appropriate rate of pay that should be paid to an employee.

PN13

THE COMMISSIONER: Under the terms of an agreement?

PN14

MR ADDISON: Under the terms of the agreement and the award.

PN15

THE COMMISSIONER: This is based on an interpretation of the award and the agreement?

PN16

MR ADDISON: Indeed, Commissioner, yes.

PN17

THE COMMISSIONER: Based on an interpretation of the relationship between the award and the agreement?

PN18

MR ADDISON: Indeed.

PN19

THE COMMISSIONER: A proper construction of the terms of the agreement? Is that right?

PN20

MR ADDISON: Commissioner, the agreement states that when an employer terminates, the employee gets the base rate of pay. The award and the agreement contain both base rate, described as base rate and supplementary payments.

PN21

THE COMMISSIONER: So this is a matter of interpretation of these instruments, is it, what the legal effect of the instruments is?

PN22

MR ADDISON: Yes, Commissioner. Commissioner, when the agreement was made, the agreement purported not to diminish the terms and conditions of employment which are contained within the award.

PN23

THE COMMISSIONER: Mr Addison, I actually haven't granted Mr Cooper leave yet, but I am going to do so on the grounds that the issues concern not so much what the industrial rights, duties, privileges and obligations to the parties should be, either for the purposes of conciliation or arbitration, but rather what their legal rights are.

PN24

MR ADDISON: Yes.

PN25

THE COMMISSIONER: And the fact that I assume that the Commission is empowered to settle it under a dispute settlement procedure of an agreement. Is that right? Is that right, Mr Cooper? The relevant certified agreement empowers the Commission pursuant to section 170LW to settle disputes over the application of the terms of the agreement?

PN26

MR COOPER: Yes, Commissioner. I suppose the point is that what brings us here today, though, is purportedly a section 99 notification.

PN27

THE COMMISSIONER: It is really just a procedural silo, though, isn't it? I mean, there is probably an industrial dispute broadly defined and possibly a dispute over the application of the agreement.

PN28

MR COOPER: That may be right.

PN29

THE COMMISSIONER: It is just a question of what jurisdiction and powers are available to settle each or both.

PN30

MR COOPER: Yes. I suppose the main point and this may be more of a procedural point that if the union is serious about a 170LW proceeding, then certain notice and formal submissions would need to be made so that we can properly respond.

PN31

THE COMMISSIONER: All I say about that is, leaving aside what procedure is adopted to deal with the matters, the situation is as a matter of fact, is it not, that there is an agreement that empowers the Commission to deal with disputes over the application of the terms of the agreement?

PN32

MR COOPER: Yes, there is, Commissioner.

PN33

THE COMMISSIONER: All right. That is the only observation I am making and having regard to that and having regard to the nature of the dispute as it is described to me, which is over the rights of the parties as opposed to their interests, I think it is appropriate that I grant you leave to intervene.

PN34

MR COOPER: Yes, Commissioner.

PN35

THE COMMISSIONER: I hadn't done that and Mr Addison had withdrawn his objection, but I hadn't had the opportunity to actually grant you the leave.

PN36

MR COOPER: Yes, thank you, Commissioner.

PN37

THE COMMISSIONER: My decision was independent of his objection, or withdrawal.

PN38

MR COOPER: Yes. Thank you, Commissioner, and perhaps while I am on my feet, I might just say that the company agrees that the substance of the dispute is really as characterised, as just characterised by the Commission.

PN39

THE COMMISSIONER: Understood. Well, it sounds like a dispute over the rights of someone whose employment is terminated in particular circumstances under the terms of the agreement. Is that right?

PN40

MR ADDISON: That is correct, Commissioner.

PN41

THE COMMISSIONER: It is about how much they should be paid.

PN42

MR ADDISON: Yes, Commissioner, it is. Commissioner, this is a section 99 at the moment.

PN43

THE COMMISSIONER: It is a section 99 dispute, but the fact of the matter is quite independently of that, the Commission is empowered by section 170LW and the dispute settlement procedure of the agreement to deal with the matter and if the matter comes to the Commission via a section 99 dispute, it doesn't take away or somehow or other corral the Commission's jurisdiction.

PN44

MR ADDISON: No. I accept that, Commissioner, entirely. What we were hoping to do today was to bring to the Commission's attention, basically outline on the record what our concerns are, hopefully go into conciliation with the company.

PN45

THE COMMISSIONER: Would you tell me what it is you think should be paid and what has been paid or is going to be paid?

PN46

MR ADDISON: Commissioner, the award, both the 1993 award and the new simplified award which was made by Commissioner Roberts in Sydney in March of 2003 stipulate that on termination and in the - well, dealing with the new award, with the 2003 award, clause 35.13.1(a) says that on termination a person would be paid the pro rata annual leave on the total wage rate specified in clause 22.1, clause 22.1 of the 2003 award.

PN47

THE COMMISSIONER: 22.1?

PN48

MR ADDISON: 22.1, yes, and that is simply the wages clause of the 2003 award and that clause 22 has the wage rates broken up into minimum weekly rate, what is described in this award as a residual payment and then has a total wage rate calculation. Now, Commissioner, in terms of the certified agreement, the certified agreement says at clause 15 of the certified agreement, 15(n), that in terms of payment for leave entitlements on termination, that:

PN49

An employee other than a continuous or seven-day shift worker be paid at the appropriate base pay rate specified in clause 8.

PN50

And if one goes to clause 8 of the certified agreement, that has base pay rates laid out at 8(b) and then it has what is described as supplementary pay rates which are basically a percentage as I understand it of the base rate and they are for the disabilities associated with shifts, the shift penalties, the weekend penalties, et cetera, et cetera, et cetera, and in terms of the definition of the supplementary pay rates, it says an amount for annual leave loading and long service leave also.

PN51

Now, the difficulty we have, Commissioner, and, of course, a reasonably good employer, we have got to say that for the record and very few people ever leave and last year we had a couple of people leave, only on the basis that as I understand it, they were basically travelling interstate, so they left and they are the first people as I understand it to have actually left in our area of coverage since we have had enterprise agreements and that has raised this dispute because the employees actually got paid less on leaving than they would under normal circumstances and as we understood the operation of the agreement, less than what they should have been paid.

PN52

Now, our clear understanding of the agreement was that it was not to operate in such a way as to diminish the entitlements of employees under the terms of the award and the way it is operating does exactly that for employees who are terminate or who self terminate, for that matter. Now, Commissioner, as each of the agreements has been certified, the statutory declarations that have been filed with them at question 7.5 and that is the question that is asked with regard to award conditions, for instance, in the 2002 certified agreement which certified by Commissioner Holmes on 16 December 2002 at clause 7.3 of the statutory declaration which is the question that asks:

PN53

Please identify by referring to specific clauses in the agreement any reductions in terms and conditions of employees under any relevant or designated law or award.

PN54

Then it talks about section 170XA, et cetera. There is nothing there. There is no reference to a diminution of entitlements that employees would have under the award as opposed to what they would have under the terms of the agreement. Similarly in the newly certified agreement which was certified by Commissioner Mansfield on 29 October 2004, in terms of the statutory declaration filed in support of that agreement and I refer to the statutory declaration of Steve Dargavel rather than that of the company, but I understand the company's is in identical terms, at 7.4 of that statutory declaration, it asks the same question:

PN55

Specify the terms and/or conditions that were reduced, the employees affected and the specific clauses in the agreement that bring about the reductions.

PN56

The answer is:

PN57

Not applicable.

PN58

So, Commissioner, I have the delegates with me this afternoon and the delegates instruct me that - and these delegates are long-term employees and long-term delegates as well, Commissioner, have been involved I think in virtually all of the certified agreements that have been negotiated on the site, if not all.

PN59

The delegates instruct me that at no time during the course of the negotiations was there ever an intent that a person leaving would, in fact, get less than what was provided for in the award and at no time when agreements have been put to the vote by the delegates to the employees have the employees ever been told that there would be a reduction in terms of the payments to terminating employees.

PN60

Now, we say, Commissioner, that whilst agreements override awards and we accept that, that is a matter of fact and that is the scheme of the Act, that agreements can modify the terms of the award, to properly certify an agreement, for an agreement to be properly certified and to have legal effect, there are a range of steps.

PN61

One of those steps is that the terms of the agreement and the effect of the terms of the agreement must be explained to employees who are to be covered by the terms of the agreement and that the employees, once that has been explained to them and the Act makes that as the responsibility of the employer, but once those terms have been explained to them and they understand the effect of those terms, then to have a period of 14 days and then a valid majority needs to support the agreement.

PN62

We say those important steps in terms of the certification process clearly haven't been set in place through the course of these agreements that are before you. We don't say that is anybody's fault necessarily. We just say that is the practical reality of where we are at and, Commissioner - - -

PN63

THE COMMISSIONER: What is the consequence of that?

PN64

MR ADDISON: Well, it would seem to me as a matter of operation of the Act that the agreements are not correctly certified.

PN65

THE COMMISSIONER: Because they have never been approved by a valid majority?

PN66

MR ADDISON: They have been approved by a valid majority, but they have been approved by a valid majority where prior to that, the terms and effect of the conditions have not been properly explained and therefore the employees when voting on the agreement haven't understood how the agreement would operate and we would say that is basically a fatal flaw in terms of the certification process.

PN67

THE COMMISSIONER: If that is the case, then I don't have any power to do anything.

PN68

MR ADDISON: That is arguably true, Commissioner.

PN69

THE COMMISSIONER: Any power that I have to deal with this matter under the terms of the agreement arises only if the agreement has been certified.

PN70

MR ADDISON: Validly certified, we would say, Commissioner.

PN71

THE COMMISSIONER: There is only certified or not certified.

PN72

MR ADDISON: Exactly. That is correct, Commissioner, that is correct. You are right, that would remove that power, I guess.

PN73

THE COMMISSIONER: If you are right, too, your argument is essentially that the award applies.

PN74

MR ADDISON: The award would have to apply, Commissioner, that is correct. There would be no certified agreement, no validly made certified agreement. Therefore, the award would apply.

PN75

THE COMMISSIONER: In all its respects.

PN76

MR ADDISON: In all of its respects, arguably including the wage rates, unless there is some sort of contractual arrangement that is there and I would suggest there probably is a contractual arrangement there, but that is something we would need to deal with and certainly the award rates, as I understand it - it was a paid rates award, but, anyway - - -

PN77

THE COMMISSIONER: If that is the case, let's assume that we travel down that road, we arrive at this situation where the issue is the proper application, operation of the award, I am likewise disarmed in that respect, am I not? I have no jurisdiction to enforce the terms of the award.

PN78

MR ADDISON: You would have the jurisdictional basis under section 89A.

PN79

THE COMMISSIONER: To make an award? To make an award in the same terms as - - -

PN80

MR ADDISON: And to settle an industrial dispute under the terms of section 89A.

PN81

THE COMMISSIONER: Yes, but I can't pretend to be settling an industrial dispute when I am actually exercising judicial power to interpret the meaning of the award. That is long settled, isn't it? I think the expression in the High Court was that the Commission pull its jurisdiction up by its bootlaces.

PN82

MR ADDISON: Yes, I think that is right.

PN83

THE COMMISSIONER: So the problem with that line of submission is that it leaves me completely disempowered in relation to this dispute because the dispute isn't over the interests of the parties in relation to the establishment of appropriate terms and conditions of employment. It is actually over what the existing rights of the parties under the award are.

PN84

MR ADDISON: It is over the rights, yes, that is right.

PN85

THE COMMISSIONER: If there is no agreement, then I have no power to settle the dispute over the application of the terms of the agreement.

PN86

MR ADDISON: Indeed, because there is no agreement to settle.

PN87

THE COMMISSIONER: So I am not here, actually.

PN88

MR ADDISON: Commissioner, except this - - -

PN89

THE COMMISSIONER: I have just disappeared. I am wearing bandages.

PN90

MR ADDISON: Except that the Act, of course, encourages conciliation as a first step and that is one of the reasons why we brought this matter - - -

PN91

THE COMMISSIONER: Yes, but I can only conciliate in relation to industrial disputes.

PN92

MR ADDISON: That is correct.

PN93

THE COMMISSIONER: An industrial dispute is not about the interpretation of an application of the terms of an award. That doesn't constitute an industrial dispute. An industrial dispute constitutes a demand made by one party against another which is unfulfilled.

PN94

MR ADDISON: Correct.

PN95

THE COMMISSIONER: It is not a demand for the performance of the parties' obligations, existing legal obligations. It is a demand to concede a condition of employment.

PN96

MR ADDISON: No, Commissioner. It is a demand that the existing obligation be met and that existing obligation exists under the terms - - -

PN97

THE COMMISSIONER: I suppose you could say there is a demand that - there is no agreement and there is a demand that terminating employees be paid as follows.

PN98

MR ADDISON: Per the award.

PN99

THE COMMISSIONER: It just so happens to be that the award - no, once you say per the award, there is no jurisdiction, but if it just happens to be the case that that is what the award says, too, that might be the case.

PN100

MR ADDISON: That is correct.

PN101

THE COMMISSIONER: But then the real issue arises, where does the public interest lie in determining such a dispute, given that the award already prescribes that in relation to these employees? If I award it in terms of the award, that wouldn't take your matter any further, would it?

PN102

MR ADDISON: Well, it wouldn't in terms of enforcement.

PN103

THE COMMISSIONER: I think it illustrates the substance of the issue and that is that if you want an interpretive approach, the only available jurisdiction is under section 170LW and that is predicated on acceptance of the validity of the certification of the agreement.

PN104

MR ADDISON: That is correct.

PN105

THE COMMISSIONER: If you want that, you are probably going to have to concede the validity of the certification or not challenge it.

PN106

MR ADDISON: Indeed.

PN107

THE COMMISSIONER: I am entitled to proceed on the basis of its certification, so I think we have come full circle, haven't we? We are back to the agreement and it doesn't matter if - - -

PN108

MR ADDISON: It is somewhat circular, yes.

PN109

THE COMMISSIONER: If you are going to argue before me that my approach to this should be to say that the agreement is mistakenly certified, therefore has no force and effect, then there is nothing I can do.

PN110

MR ADDISON: That leaves us with a section 178 application. I accept that.

PN111

THE COMMISSIONER: I am talking about what I can do.

PN112

MR ADDISON: I accept that. The other option, of course, is that the parties conciliate and we say if there is anywhere that we can go in terms of reaching an agreement between the parties, that could well - - -

PN113

THE COMMISSIONER: It just seems to me that if you are going to mount an argument that the agreement has been certified by mistake, it is void or should be set aside by virtue of the mistake, that that ought not be confused with the dispute over the terms of the agreement. It is undesirable.

PN114

MR ADDISON: I accept that.

PN115

THE COMMISSIONER: So if you want me to deal with the dispute under section 170LW, you probably need to tell me that pretty soon. That means resiling from what you have just said about the fact that the agreements are non sequitur.

PN116

MR ADDISON: I think I might seek a short adjournment at that point, Commissioner, if that is appropriate.

PN117

THE COMMISSIONER: You can always withdraw that without prejudice. There is nothing to stop you at any time arguing on an appropriate application that the agreement has been mistakenly certified. Until such time as it is found to be the case by the Commission and some sort of order is issued, then the certification is in operation, so I don't think there is a real issue for you here, is there?

PN118

MR ADDISON: Not really, Commissioner, no.

PN119

THE COMMISSIONER: I am not averse to the idea of conciliation. Don't get me wrong. In fact, I imagine that is what it says. I don't actually have it in front of me, but I presume that there is some sort of process that involves conciliation.

PN120

MR ADDISON: The Act itself requires that, Commissioner, in terms of the agreement.

PN121

THE COMMISSIONER: It may well be explicitly part of the dispute settlement procedure. I don't know. Can you tell me?

PN122

MR ADDISON: Commissioner, the agreement's dispute settlement procedure does give the Commission the power to settle a dispute.

PN123

THE COMMISSIONER: What does it actually say?

PN124

MR ADDISON: It just says:

PN125

If the matter cannot be settled through this mechanism -

PN126

which is the steps:

PN127

it will then be referred to the Commission for determination. The decision or recommendation of the Commission will be accepted.

PN128

The normal processes of the Act, one would presume is conciliation, Commissioner.

PN129

THE COMMISSIONER: I accept that, so we can have some conciliation.

PN130

MR ADDISON: Indeed, Commissioner, that is what we would seek.

PN131

THE COMMISSIONER: Certainly. We will do so in a moment, so I will just give you the opportunity to put anything you want to on the record, but I should indicate to you that for the time being, I am operating on the basis of the agreement as a certified agreement and if you want to put it to me that that certification was mistaken and that the agreement is void or should be set aside, that should be the subject of a separate application.

PN132

MR ADDISON: Indeed, Commissioner. I agree with that. If the Commission pleases.

PN133

THE COMMISSIONER: Mr Cooper, did you want to say anything before we have a conciliation?

PN134

MR COOPER: I would like to just respond with some fairly quick general points, before we do go into conference. The company was brought here in response to a section 99 notice. It may be that a section 170LW proceeding is the appropriate way to go. We merely make the point that there hasn't been such a reference yet and we don't necessarily concede that the preliminary steps under the disputes agreement - - -

PN135

THE COMMISSIONER: have been completed.

PN136

MR COOPER: have been completed.

PN137

THE COMMISSIONER: That is something we could probably profitably pursue at conciliation quite independently under the section 99 notification.

PN138

MR COOPER: Yes. Despite that, we are happy to go into conciliation. In terms of the subject matter of the dispute, we think that the relevant agreement provision is abundantly clear and that is clause 15(n).

PN139

THE COMMISSIONER: It uses the words base rate and they appear in the agreement as I understand it.

PN140

MR COOPER: Yes, that is the position of the company. As to the interaction with the awards referred to in the agreement, we would say that to the extent of any inconsistency, the agreement quite clearly prevails.

PN141

THE COMMISSIONER: The agreement prevails.

PN142

MR COOPER: Under the terms of the Act and the agreement itself. There is reference to the avoidance of erosion of existing rights of entitlements of employees under the award. Now, with respect, we would say that it makes no sense to talk of an erosion of rights or entitlements under this agreement given that - - -

PN143

THE COMMISSIONER: Sorry, is the reference to existing rights and entitlements under the award or the agreement?

PN144

MR COOPER: I am talking about clause 3 of the agreement.

PN145

THE COMMISSIONER: What does that say?

PN146

MR COOPER: In particular clause 3(b). It says that - and I am paraphrasing, the terms of the 1993 and 2003 awards are incorporated into the agreement and that the agreement is not to operate so as to prevent the erosion of employee rights and entitlements expressed in those awards. The point I would make is that there has been a very long history of EBAs at the company whereunder annual leave pay-outs on termination have only been calculated on base pay and we are talking about a series of - - -

PN147

THE COMMISSIONER: So you are able to actually document the pay records of this?

PN148

MR COOPER: Yes. I can go to the relevant clauses of the series of EBAs which have substantially remained the same. They all refer to the base rate of pay for annual leave pay-outs on termination or resignation.

PN149

THE COMMISSIONER: I understood that part of it. I thought you were also saying not only that, but evidence of the custom and practice can be produced as well.

PN150

MR COOPER: Yes.

PN151

THE COMMISSIONER: Which conforms to this term.

PN152

MR COOPER: Contrary to the submission of Mr Addison, there have been a number of employees resign or have been terminated over the period since 1996 and we are talking about the period since '96 and the series of six or seven EBAs where the pay-outs have been calculated on the basis - - -

PN153

THE COMMISSIONER: I take it this is where people either give notice or they have got some accumulated entitlement or are given notice.

PN154

MR COOPER: Yes.

PN155

THE COMMISSIONER: So the calculations in relation to the annual leave accruals.

PN156

MR COOPER: Yes.

PN157

THE COMMISSIONER: What is the difference? Can somebody help me with what the difference is?

PN158

MR SCOTT: The person who has been on shift - - -

PN159

THE COMMISSIONER: I really want to know what the amount of money is.

PN160

MR SCOTT: Well, if you have a person on shift, they have a base loading, a base rate and then they have a 44 per cent loading on top, so it is nearly half their pay.

PN161

THE COMMISSIONER: So it is 44 per cent?

PN162

MR SCOTT: So the guy, when he left, he only got half of virtually what he was expecting and after the tax man got it, he only got quarter.

PN163

THE COMMISSIONER: So the rate would be - I think I need a copy of this agreement.

PN164

MR COOPER: I can hand up a copy.

PN165

THE COMMISSIONER: I think we will actually get the Commission's copy if you don't mind.

PN166

MR COOPER: Perhaps while that is being retrieved, I could just make a point about the actual amounts.

PN167

THE COMMISSIONER: Could you give us the full title of the agreement, please? It wasn't actually cited in the notification.

PN168

MR COOPER: Yes, the full title of the agreement, Alcoa Australia Rolled Products Point Henry Agreement 2004.

PN169

THE COMMISSIONER: All right, go ahead.

PN170

MR COOPER: Commissioner, just in relation to a comparison of amounts and this is part of our overall submission, there may be some difficulty in that we are talking about different things, apples and oranges, to use an analogy. The pay structure under the award, under the current award, is completely different.

PN171

Allowances are dealt with separately in some cases, the wage rates are much less than the effective wage rates under the agreement and that is not surprising. That is the way it should be with a simplified award which operates as a safety net, but, of course, the agreement is completely different. It provides for annualised salaries and it provides for much greater effective bargained wage rates.

PN172

Now, we think there would be some difficulty in mixing and matching the two and somehow trying to snatch something from the award in terms of a concept for the calculation of an annual leave pay-out, but apply that to the more favourable aspects of the agreement. Given that the annual leave provisions of the agreement were clearly designed to cover the field, we would submit that that is an inappropriate approach to the issue.

PN173

But going back to where I was in terms of the overall interaction between the agreement and the awards, true it is that there is reference to the non-erosion of existing right and entitlements, but, of course, the particular agreement provisions we are talking about actually post date the inclusion of the EBA provisions that specify the basis for calculating the annual leave, accrued annual leave pay-outs.

PN174

So to put it another way, you can only erode something that was there and what the union would contend was there was not. The agreements already provided since 1996 for the basis of calculating the pay-out and that was on base pay only. For them to rely on provisions that were included in the EBAs from I think around 2000 to coincide with the union's campaign 2000 is inappropriate in our submission.

PN175

Those provisions as I understand it and my learned friend may be able to assist with this, those weren't designed to deal with the situation where in the award simplification process, rights and entitlements of employees may drop out and may not be caught at all, but that doesn't apply in this case, because the subject matter we were talking about had already been dealt with comprehensively in the EBAs.

PN176

We don't concede that we necessarily get in to all that, Commissioner, because clause 15(n) of the agreement is quite clear, as is clause 3(c) which deals with the agreement taking precedence, but if the union wants to take us there, that is the company's position.

PN177

THE COMMISSIONER: So what was it that triggered this dispute? Was there some recent resignations?

PN178

MS CRAVEN: We have had two resignations this year.

PN179

THE COMMISSIONER: Two resignations?

PN180

MR COOPER: Yes.

PN181

THE COMMISSIONER: When did they occur?

PN182

MR SCOTT: One was last year, one was this year.

PN183

MR COOPER: The next point, Commissioner, is that we don't concede that the 2003 award at least provides conceptually for a different basis of calculation. Now, let me explain that.

PN184

THE COMMISSIONER: I think I can anticipate what you are going to say, that the total rate in the award is actually an unloaded rate. That is the ordinary time hourly rate under the award.

PN185

MR COOPER: The total rate in the award is exclusive of shift allowance, yes.

PN186

THE COMMISSIONER: I understand.

PN187

MR COOPER: Now, the response that the union might make to that, though, is that the 2003 award provides that you do get the annual leave loading paid out when your accrued annual leave is paid out on termination which corresponds to the lost shift benefits.

PN188

THE COMMISSIONER: The 17.5 per cent or the shift loading?

PN189

MR COOPER: Correct.

PN190

THE COMMISSIONER: So the shift worker is paid their shift loadings as per what they would have been had they been on a shift during a period of leave?

PN191

MR COOPER: Yes. That is not a provision that one would find in all awards and I don't think it appears in the Metals Award.

PN192

THE COMMISSIONER: It is not that uncommon, though, is it?

PN193

MR COOPER: The further response to that argument by the company is that, well, under the agreement, that annual leave loading is not lost. It is built in to the base rate of pay, anyway. That was part of the salary annualisation process.

PN194

THE COMMISSIONER: At the moment we are talking about two different loadings, though. The 17.5 per cent annual leave loading for day work is built into the annualised salary?

PN195

MR COOPER: Yes.

PN196

MR ADDISON: Commissioner, just on that point, it is actually built into supplementary payments, the leave loading. It is not built into the base. That is what it says in the agreement. It says in the agreement it is built into the supplementary. I am happy to be corrected on this, but the agreement suggests clearly that it is built into the supplementary payments, because at clause 8(b) - Commissioner, maybe if I hand you a copy of 2002/2004 Commission copy.

PN197

THE COMMISSIONER: I am going to get one in a second, Mr Addison.

PN198

MR ADDISON: This is in exactly the same terms, that is all, but at 8(b) it talks about the supplementary payments and it is at 8(a)(ii) so it talks about supplementary:

PN199

In addition to the base pay, a supplementary payment is made. Where applicable, this includes compensation for the following.

PN200

Then first of all it is seven-day shift work as 42 hours per week average, normal roster, and then another shift arrangement which is 40 hours, continuous shift workers, disabilities, disturbances, et cetera, public holidays that fall on the day where continual shift workers are not rostered to work, shift coverage arrangement recalls, travel time, et cetera, and then finally annual and long service leave loadings, so it seems on the face of the agreement - - -

PN201

THE COMMISSIONER: Is there such a thing as a long service leave loading?

PN202

MR ADDISON: Not normally. I don't know whether there is in this industry. There may well be in this industry, but not normally, Commissioner, but it seems on the face of the agreement that the leave loadings are actually in the supplementary payments which one presumes are in fact the payments referred to in the 2003 award as the residual payments.

PN203

That was just to clarify that point, Commissioner. If I can say, Commissioner, it has just been pointed out to me, too, the predecessor award to the 2003 simplified award was the 1993 award and that was an award made by Keogh SDP on
3 December 1993 and in that award, it talks about the total wage rates specified in any event, so it is the same provision in the predecessor award. If the Commission pleases.

PN204

THE COMMISSIONER: Can somebody just take me to where the entitlement to accrued annual leave applies?

PN205

MR ADDISON: It is clause 15(n), Commissioner. That is proportionate leave on termination. Clause 15 deals with annual leave and that is at page 18 of 28 of my copy.

PN206

THE COMMISSIONER: Are these people employed as other than a continuous seven-day shift worker, the ones who resigned?

PN207

MR ADDISON: Yes. Maybe Mr Scott is best to answer that question, Commissioner.

PN208

THE COMMISSIONER: They weren't seven-day shift workers?

PN209

MR SCOTT: There was one employed as a seven-day shift worker and there was also one employed as a day shift worker.

PN210

THE COMMISSIONER: All right.

PN211

MR COOPER: Commissioner, clause 8(a)(2)(vi) clearly says what my friend is submitting. My instructions are that prior to this agreement, various allowances and loadings were built into an annual base rate of pay which included the leave loadings. I accept that that is not represented by the provision that we have been directed to and I am not withdrawing my submission, but I say nothing more about it at this stage. I say nothing more about that submission at this stage, Commissioner. It may be a question of me getting further instructions on that. Perhaps if I can move on.

PN212

THE COMMISSIONER: Yes.

PN213

MR COOPER: Clause 3(b) of the agreement refers to both the 1993 and 2003 award. That creates a question in our submission given that they really are one and the same. The 2003 award is the simplified version of the 1993 award and the provisions, as we might refer to them as, they existed at any particular point in time, so we would suggest that that means that they are as they currently are and they currently are as per the 2003 award.

PN214

I say nothing more about that at this stage, but merely flag it. We make no submission about the validity of the agreement. We are happy to proceed on the basis at this stage that it is a valid agreement and validly certified. We reserve our position regarding the effect, or the content or effect of any statutory declaration, evidence that was submitted.

PN215

We would say, though, that, of course, the agreements were required to pass the no disadvantage test and that is not a line for line provision by provision test. Under section 170XA(2), it is a question as to whether there is an overall reduction of rights and entitlements, so even if there was a particular reduction in this particular area, which we don't concede, that could have been offset. Nothing further, Commissioner.

PN216

THE COMMISSIONER: I just want to be clear on something. You are telling me that the proportionate - just one moment. I will get the correct title. The proportionate leave on termination provisions of the agreement were the same in the previous agreement?

PN217

MR COOPER: Yes.

PN218

THE COMMISSIONER: And so when whoever it was that resigned last year is concerned, they were paid in the manner that you contend for?

PN219

MR COOPER: Yes.

PN220

THE COMMISSIONER: When was that resignation?

PN221

MS CRAVEN: Your Honour, one was in - Commissioner, about the last eight weeks and one was definitely in this EBA period in probably about October of last year.

PN222

THE COMMISSIONER: Thank you, and this agreement was certified in January. When was it actually reached? Does anybody recall when the agreement was reached? When did you make this agreement? Do you remember when it was approved by a valid majority?

PN223

MS CRAVEN: Commissioner, 9 December.

PN224

THE COMMISSIONER: The termination in October occurred in the lead-up to the negotiation of this agreement?

PN225

MR SCOTT: Correct.

PN226

THE COMMISSIONER: That employee was terminated, or terminated their employment, is that right, resigned?

PN227

MR SCOTT: Yes.

PN228

THE COMMISSIONER: And they received payment at the base rate?

PN229

MR SCOTT: Was this matter raised during the negotiations of the agreement?

PN230

MR SCOTT: No, it wasn't.

PN231

THE COMMISSIONER: It is not as if this practice is new, is it, or these terms of the agreement are new, but the terms and the practice are established? Both the term of the agreement is not new nor is the practice new. It was established under the previous agreement, but as a term of that agreement and it was established as a practice under that agreement because the person who resigned in October was paid under the same terms. In other words, clause (n) of clause 15 is in the same terms now as it was in October when that person resigned. Is that right?

PN232

MR ADDISON: Commissioner, my understanding is that the person resigned in about October of last year. The matter was raised with the company. The agreement is effectively a rolled over agreement. The terms of the 2002 agreement - the terms of the current agreement, they are almost identical, rolled over. Now, the matter was raised by the delegates with the company immediately after the person resigned in October.

PN233

There have been a number of discussions. I was asked to have a look in around about December of this year. I assumed the organiser had spoken to the company. I spoke to the organiser four or five times over the last couple of months with regard to this matter. I am now instructed the organiser actually didn't speak to the company, so I apologise to the company for that.

PN234

I just assumed that had occurred, but the matter has been ongoing for a significant period of time. The matter wasn't addressed through the new certified agreement and the question you are asking the delegate is exactly the same question I asked the delegate about two hours ago. I don't know why, but it was basically in a process being dealt with.

PN235

THE COMMISSIONER: Really, that is a matter internal to the organisation, isn't it?

PN236

MR ADDISON: Yes.

PN237

THE COMMISSIONER: The point that I have got to take into account is this, that this term is not an innovation that comes with this agreement.

PN238

MR ADDISON: No. That is right.

PN239

THE COMMISSIONER: It is a term which has existed in a previous certified agreement and it is a term which has been applied by the company according to its interpretation under a previous agreement.

PN240

MR ADDISON: That is not my understanding, Commissioner.

PN241

THE COMMISSIONER: What about the October resignation?

PN242

MR ADDISON: That is the one that is in dispute, along with the one this year.

PN243

THE COMMISSIONER: But the point that I am making is that had that matter been a matter of concern during the course of the negotiation of the agreement, surely it should have been addressed the term of the agreement either changed or alternatively the bargain left it unchanged.

PN244

MR ADDISON: In a perfect world, I would agree with you, Commissioner.

PN245

THE COMMISSIONER: But neither I nor the company are really affected by any decision either to bargain one way or the other on this.

PN246

MR ADDISON: That is right.

PN247

THE COMMISSIONER: That is what I mean, that it is a matter internal to the organisation. It was its choice. It may have been a choice by forfeit, but nevertheless it is a choice.

PN248

MR ADDISON: I hear what you say, Commissioner. I would rather say it was an omission, rather than a deliberate choice.

PN249

THE COMMISSIONER: A choice by forfeit, a choice by omission.

PN250

MR ADDISON: A choice by forfeit, yes, I guess you could say that, Commissioner.

PN251

THE COMMISSIONER: You chose to admit what was at the time an issue of concern arising out of the October resignation from the bargaining agenda for the making of this agreement.

PN252

MR ADDISON: Commissioner, my understanding and my instructions are that the agreement was all but concluded when this matter arose, but all the substantive issues had been dealt with.

PN253

THE COMMISSIONER: I have just been told it wasn't approved by a valid majority of employees until December.

PN254

MR ADDISON: Correct, to the best of my knowledge.

PN255

THE COMMISSIONER: Surely the union was involved in forming up that valid majority.

PN256

MR ADDISON: Sorry?

PN257

THE COMMISSIONER: Surely the union was involved not only in signing off on the agreement, but also in requiring its members to approve the agreement.

PN258

MR ADDISON: Yes of course.

PN259

THE COMMISSIONER: So as late as December, I mean, from October to December gives you plenty of time to get a disputed proportionate annual leave on termination payment onto the agenda for the negotiation of the agreement.

PN260

MR ADDISON: Yes. That is logically correct, Commissioner.

PN261

THE COMMISSIONER: It is not a highly complex issue.

PN262

MR ADDISON: No. That is logically correct.

PN263

THE COMMISSIONER: You could rewrite this clause for bargaining purposes in, you know, 10 seconds.

PN264

MR ADDISON: Yes.

PN265

THE COMMISSIONER: It would simply have to say that at the appropriate base rate plus supplementary payment specified in clause 8.

PN266

MR ADDISON: Yes, or you would change base the total and it is the same thing.

PN267

THE COMMISSIONER: The point that I am making is that this is an aid to interpretation surely and first of all, it just seems to me, with all due respect,
Mr Addison, this is a pretty plain meaning story, this one. I mean, the word base rate is used in clause 8. Clause 8 is referred to in the annual leave clause.

PN268

It refers specifically to clause 8 and in clause 8 there is a terminology, a base rate, which has a clear and unambiguous meaning which is a lesser rate than the combination of the base and the supplementary payment. Now, if that is what the agreement says, it is very hard to see how we can go behind that unless the company wants to re-open the agreement.

PN269

MR ADDISON: The agreement also says, Commissioner, very clearly and Mr Cooper has pointed me to it, clause 3, that the agreement will not operate so as to diminish the terms and conditions applicable under the appropriate awards.

PN270

THE COMMISSIONER: Erode them.

PN271

MR ADDISON: Erode them, that is correct.

PN272

THE COMMISSIONER: Look, isn't there a conflict between the two terms?

PN273

MR ADDISON: Yes. I guess that is correct, yes.

PN274

THE COMMISSIONER: There is a conflict between the express plain meaning of clause (n) and clause 3 which is, with all due respect, a rather poor - it is a lesser vehicle, it is not the greater vehicle. It won't carry everything.

PN275

MR ADDISON: I accept that.

PN276

THE COMMISSIONER: I mean, with respect, it was a campaign 2000 device designed to somehow or other capture more than the drop-out of matters that cease to be allowable award matters.

PN277

MR ADDISON: Commissioner, the words in clause 3 may well have been introduced into the agreements in 2000. The sentiment of clause 3 certainly has been in place all the way through enterprise bargaining with this employer and on my instructions, my understanding, the award simplification process in this industry is pretty different to most award simplification matters. It was dealt with like an enterprise bargain with Mr Hester who is here and myself and the various delegates over months and months and the intent always was that nobody would suffer a reduction in their terms and conditions. Now, that was clear all the way through the process.

PN278

THE COMMISSIONER: But it hasn't really been given such clear effect in the agreement, has it? Why use the word erosion? What does that mean?

PN279

MR ADDISON: I guess it means that there are certain terms and conditions that are applicable and that this agreement would not be used as an instrument to erode away those terms and conditions.

PN280

THE COMMISSIONER: But, you see, with all due respect, it is just a hopelessly general rhetorical instrument in terms of giving effect to the terms and conditions of employment as between employers and employees. It is sort of like extracting something from a circular and putting it in an agreement and hoping that it has some sort of legal efficacy at the end of the day, when it comes to be interpreted in a tribunal like this.

PN281

MR ADDISON: Sure, but the word erode has meaning and the word erode means to slowly remove parts of provisions over a period of time and that is not the intent of the agreement, as I understand it and as I am instructed and the words that the agreement would not be used as a means of erosion - - -

PN282

THE COMMISSIONER: But with all due respect, does it, anyway?

PN283

MR ADDISON: Well, it does.

PN284

THE COMMISSIONER: The difficulty is that even taken at its highest, I have some doubt that you could win this argument if I was with you all the way, to the point of saying that this particular sentence in subclause (b) needs to be applied quite specifically to the proportionate leave on termination provisions and the reason why I say that is this, that the total rate of pay prescribed by the award has got to be less than the base rate of pay prescribed by the agreement, hasn't it?

PN285

MR ADDISON: I haven't looked at that, but I would guess that you are probably right, Commissioner. It is a simplified award.

PN286

THE COMMISSIONER: I can recall having a look at this agreement when I certified it in terms of the no disadvantage test.

PN287

MR ADDISON: Clearly the agreement would pass the no disadvantage test.

PN288

THE COMMISSIONER: I am not talking about the no disadvantage test. Let's not go down that path. I don't think we need to. What I am saying to you is the amount of annual leave payment conferred on an employee on a pro rata basis by the award will be less than the amount conferred by the agreement.

PN289

MR ADDISON: I don't know, Commissioner, I don't know. It would depend on these residual payments that are in clause 22 of the new award. I would hate to venture an opinion on that at this point in time, Commissioner. I don't know.

PN290

THE COMMISSIONER: If that was the case, if that was the case, would you accept that the second sentence of clause (b) had no work to do? See, I am taking your argument at its highest. I think there's a few issues along the way, but let's go right to the peak of it and would you accept that if what happens is that the base rate of pay under the agreement is actually superior to the total rate of pay prescribed by the award?

PN291

MR ADDISON: Then the second sentence would have no work to do. I accept that.

PN292

THE COMMISSIONER: No meaning?

PN293

MR ADDISON: I accept that. That has to be the correct meaning. Even though I hate to admit it, I think that has to be the correct meaning.

PN294

THE COMMISSIONER: Do we know whether that is true or false?

PN295

MR ADDISON: I don't.

PN296

MR COOPER: I am instructed that it is true, Commissioner. To take an example, if one looks to the 2003 award - - -

PN297

THE COMMISSIONER: Are you taking me to the total wage rate?

PN298

MR COOPER: Yes.

PN299

THE COMMISSIONER: In 22.1.1?

PN300

MR COOPER: Yes.

PN301

THE COMMISSIONER: Now, we won't conclude simply by taking a sample, but let's take one classification, let's take the level 6 just at random.

PN302

MR COOPER: The level 6 total wage rate translated to an annual salary and I have done this calculation in advance just by times-ing it by 52 weeks, gives a figure of $35,380.80. Now, if one looks to the agreement, the base rate, without even going to the supp rate - - -

PN303

THE COMMISSIONER: No, no. It is the base rate that we are concerned with.

PN304

MR COOPER: Yes, is 54,771.

PN305

THE COMMISSIONER: That is right. That is the point that I am making. That second sentence can have no work to do because there is no erosion of entitlements under the award by the operation of the proportionate leave on termination clause, because the award prescribes that someone would be paid 1/52nd of 35,380, whereas, in fact, these employees are being paid 1/52nd for each week of leave of 54,771, quite a significant amount more than the award.

PN306

MR COOPER: Yes, and because the remuneration structures under the agreement and the award are so different, in our submission - - -

PN307

THE COMMISSIONER: I understand that. As I say, taken at its highest, without any hesitation of getting there, given that second sentence in clause 3(b), work to do, means you test it against whether or not what the person enjoys under the agreement is an erosion of their rights and entitlements as expressed in the award and it is not, so that that disappears out of the equation then.

PN308

MR COOPER: Yes. We would add to that that not only is there an inconsistency to be resolved between clause 15(n) and 3(b), but, indeed, between 3(b) and 3(c).

PN309

THE COMMISSIONER: Yes, I understand that. I think I said to you before and to Mr Addison, I have just taken his argument at its highest. I know that you could say, for instance, that the inconsistency is so clear, so unambiguous, that it is a special code for the purpose of the payment of proportionate leave on termination and it overrides any general statement such as that in clause 3(b).

PN310

MR COOPER: We would go a step further and say that for clauses 3(b) and 3(c) to be reconciled, 3(b) must mean that we are only talking about rights and entitlements that are not expressly dealt with in the agreement which can occur.

PN311

THE COMMISSIONER: Yes, but it is unnecessary in light of what we have concluded.

PN312

MR COOPER: Yes, it is an alternative submission, Commissioner.

PN313

THE COMMISSIONER: Mr Addison, I think you have got real difficulties with this one, to be honest with you.

PN314

MR ADDISON: I think you are right, Commissioner.

PN315

THE COMMISSIONER: I just can't see you winning this, with all due respect. I think first of all, the plain meaning of the clause is crystal clear. It refers to a base rate in clause 8. That is what you get paid.

PN316

MR ADDISON: That is right.

PN317

THE COMMISSIONER: Not only that. If there is any doubt about that, this isn't a new term of an agreement, this is a term that pre-dates the making of this agreement and it is a term upon which the company has acted consistently with that interpretation in the past.

PN318

MR ADDISON: Was to - - -

PN319

THE COMMISSIONER: It acted in accordance with it. It wasn't confused about what it meant. It applied the agreement according to what it understood it to mean. It did so at a time when this agreement was actively under negotiation and the organisation, by whatever course of action, decided not to put this issue in contest during the negotiation, or alternatively decided to concede it if it was in contest for the purpose of the making of the agreement and ultimately saw it approved by a valid majority of its members. Now, with all due respect, I think that this is a matter that needs to be negotiated. If you want to change this, I think you have to approach the company to change it.

PN320

MR ADDISON: Indeed, indeed, Commissioner, and I think that is what - I don't agree with your chronology entirely, don't disagree with it entirely either, though. Commissioner, the once that we know that - - -

PN321

THE COMMISSIONER: In October last year.

PN322

MR ADDISON: Is the October matter which was immediately put into dispute. It has taken some time to get here. We have been working through, or we thought we were working through the disputes settlement procedure properly and certainly the delegates have had numerous discussions with the company with regard to it and I don't think that is conceded by my friends. I think that is agreed to.

PN323

THE COMMISSIONER: So this has been running in parallel to the negotiations as a grievance?

PN324

MR ADDISON: Indeed. That is what I tried to say earlier, Commissioner. Maybe I was badly expressing myself, but that is what I was trying to say earlier. The matter has been dealt with pursuant to the dispute settlement procedure. There has been a technical lapse in the dispute settlement procedure. I accept that now. I didn't know that when I got here, but I accept that. The official hasn't had a discussion, but the delegates have had numerous discussions with the company since October last year, trying to resolve it and it is a matter that has been in dispute. There has been a glitch along the way with regard to the certified agreement. I accept that and I asked exactly the same questions you were asking earlier, Commissioner, with regard to that.

PN325

THE COMMISSIONER: Ideally it should have been placed on the agenda and if it was to be deferred, well, then it could have been noted in the agreement as a matter to be dealt with.

PN326

MR ADDISON: It could have been an M-West matter, indeed. It could have been dealt with in that way, but it hasn't been and I am not putting - - -

PN327

THE COMMISSIONER: I am left with the certified agreement, though.

PN328

MR ADDISON: Sorry?

PN329

THE COMMISSIONER: But I am left with the certified agreement.

PN330

MR ADDISON: You are left with the certified agreement.

PN331

THE COMMISSIONER: All I can do is recommend that the parties have negotiations on the basis that this is actually an application by the union for a variation of the terms of the agreement.

PN332

MR ADDISON: We would have no difficulties obviously if we could reach agreement with the company with regard to the - - -

PN333

THE COMMISSIONER: It is a different context, though. If you are saying to the company, hey, look, you are obliged to do this under the terms of the agreement, they are answering something of a particular kind there. If you are saying to them, look, we accept, say in the case today, the informal indication of the Commission that we are unlikely to be able to establish that you are obliged to pay this under the terms of the agreement, but we would like you to nevertheless and we are asking you to agree to vary the terms of the agreement and we are open to negotiation on this subject with you, once again that is a different situation that they are faced with. The company needs to know whether it is being told from the union's perspective that it is not complying with its obligations under the agreement or, alternatively, whether it is being asked to agree to vary them.

PN334

MR ADDISON: We say that a person accrues annual leave at a specific rate, a particular rate. There is no reason why that person should be robbed of that accrual just because the person is terminated.

PN335

THE COMMISSIONER: They are not robbed of their accrual. I mean, what we have got to remember is that annual leave has various dimensions.

PN336

MR ADDISON: Yes.

PN337

THE COMMISSIONER: It is not a single thing. First of all, it is a right to be absent from the employment. Without annual leave, you wouldn't have any right to be absent from the employment for that period in question. You couldn't just say I want to go on a holiday, see you later. Secondly, it is a right to be paid. Thirdly, amongst other things, it is a right to be paid at a prescribed rate which may not be the same rate that you receive whilst you are at work. It might be greater or lesser than, depending upon what the term prescribes. Now, in this case it is lesser than - - -

PN338

MR ADDISON: On termination, not when you take the leave, Commissioner.

PN339

THE COMMISSIONER: Exactly, yes, on termination it is lesser.

PN340

MR ADDISON: We say an employee who is taking the leave, who has complied with what you have just said, being absent from work, being paid, would be paid a rate and that would be X. What happens when the person comes to terminate their employment, either by the company or self-terminate, it is X minus. Now, we say that is not proper.

PN341

THE COMMISSIONER: There was a time, Mr Addison, when proportionate leave on termination was not payable.

PN342

MR ADDISON: Yes. That was a long time ago, though.

PN343

THE COMMISSIONER: It is a long time ago. The point that I am making is that these rights all have their own characteristics, so the right to an amount of leave, the right to an amount of payment of leave, the right to payment of proportionate accrued leave on termination, these rights all have to be considered according to their own circumstances.

PN344

Now, in this case there is a different right for proportionate leave paid on termination, so that, for instance, you would be familiar with the fact that industrially it has been the case in the past that proportionate leave on termination was paid, it became paid, it was an evolution of the annual leave entitlements, it wasn't part of the beginning of the annual leave entitlements and then there was an annual leave loading introduced and in some cases, the annual leave loading was only paid on leave that was taken and it wasn't paid on proportionate leave on termination and then later it became paid in some circumstances, but not in others.

PN345

MR ADDISON: Agreed.

PN346

THE COMMISSIONER: So what we are here dealing with is not a question of what the company is obliged to pay the workforce, but what the union and the company negotiated will pay them and what I am saying to you is at the present time, my interpretation of the agreement, it is provisional, is that I can't see you establishing to my satisfaction that the company is obliged to pay the base rate plus the supplementary payment if a person resigns and so what I am saying to you is that as far as the Commission's conciliatory powers and responsibilities are concerned, let us be clear on what it is that is being sought. It is that the company agreed to change the existing arrangements.

PN347

MR ADDISON: That is correct.

PN348

THE COMMISSIONER: Let's not have any ambiguity about the idea that they are not doing what they are supposed to be doing, they are not paying people moneys that they owe them. What is at stake here, according to my view of this agreement, is whether or not the company's interests and the interests of the union and its members can coincide to vary what it is obliged to pay to people when they resign.

PN349

MR ADDISON: Yes, that is right. What we are saying is in our understanding of the operation of the agreement, employees would be paid the supplementary payment. The company says in their interpretation of what they understand the agreement to be, that is not the case.

PN350

THE COMMISSIONER: I tend to agree with them.

PN351

MR ADDISON: You tend to agree with them, I accept that, Commissioner. We say that we still want to have some further discussions with the company. We still want to try to reach an agreement with the company with regard to this. We still reserve our rights to do whatever we need to do in terms of - - -

PN352

THE COMMISSIONER: Enforcement?

PN353

MR ADDISON: Enforcement.

PN354

THE COMMISSIONER: You see, what I am really suggesting to you is that the company is going to be more - I withdraw that. I shouldn't speak for the company. What I am saying to you is that you probably need to work out which way you are going, whether you want me to formally determine this.

PN355

MR ADDISON: No. Certainly not at this point in time, Commissioner.

PN356

THE COMMISSIONER: Or in the immediate future under 170LW, whether you want to go to the Court to try and apply the terms of the agreement in accordance with the view that you are taking now or whether you want to move off that and say we accept that the way you have paid these people is as per the agreement, but we want you to change it. We want you to agree to change it.

PN357

We recognise that the agreement is binding upon us now. We are not within the bargaining period, but there is nothing to stop us talking about this and hopefully coming to an agreement and if we can't, we can always deal with it when the agreement expires. I think you have probably go down one course or the other, with all due respect, because I just can't imagine an employer being particularly thrilled about the idea that they are being pursued and trying to defend themselves in the Court and at the same time, they are trying to negotiate in a way that effectively concedes - - -

PN358

MR ADDISON: That is right, and, Commissioner, my expectation this afternoon was that we get to some of that negotiation, that the matter would have adjourned into conference and - - -

PN359

THE COMMISSIONER: We can still do that, but I guess - and we will do that shortly just for the sake of saving the record, but it might be useful if you have a short adjournment. Perhaps you could take some instructions, because I think that it would be useful for the company to know on the record whether or not you are going to chase them all over town with a rolling pin for this term and condition on the basis it is what they are legally obliged to pay or whether you are going to approach them from the point of view that you are going to attempt to negotiate a variation to the terms on the basis that they are currently applying them correctly.

PN360

MR ADDISON: We are happy to negotiate and that is what we seek up-front, no arguments about that and we want to negotiate with the company.

PN361

THE COMMISSIONER: Yes, but do you want to do it in a situation where you are prepared to accept my informal view, provisional view, that the agreement means what the company says it means.

PN362

MR ADDISON: Certainly on a provisional basis, I am happy to accept your provisional view.

PN363

THE COMMISSIONER: Right. I think you are being a little bit inconclusive.

PN364

MR ADDISON: In that case, I will take that adjournment, Commissioner.

PN365

THE COMMISSIONER: I will give you an adjournment. Now, if you don't want to abandon the idea that you are going to chase them for enforcement, either by having me determine this matter under 170LW and putting more to me that might persuade me to the contrary, or whether you want to say, look, okay, we will accept for the time being that the matter has been effectively determined by the Commission under 170LW because the Commission's view, expressed as a recommendation or decision, is adequate for us and consequently the agreement applies as you say it does, but we want you to negotiate with us with a view to changing it. I just don't think we can make much progress unless we know where we are going.

PN366

MR ADDISON: If the Commission pleases.

PN367

THE COMMISSIONER: Let's adjourn for five to 10 minutes to allow that.

<SHORT ADJOURNMENT [4.18PM]
<RESUMED [4.31PM]

PN368

THE COMMISSIONER: Mr Addison.

PN369

MR ADDISON: Thanks for that, Commissioner. Commissioner, we have had a discussion, we have just been having a quick discussion with the company. It wouldn't be our intention to pursue the company further in the Commission or pursue the company in the Federal Court with regard to the matter.

PN370

THE COMMISSIONER: On an enforcement basis?

PN371

MR ADDISON: Yes. We do want to have some discussions with the company. I have just raised with Mr Hester what his availability is next week. I would be seeking to go down to Geelong myself and have a discussion with the company next week. Obviously, we would need then to report back to the troops, let the troops know what is going on.

PN372

THE COMMISSIONER: If you want anything further done with this, I will keep this file and if you want further conciliation, I will convene a conciliation conference next time.

PN373

MR ADDISON: If the Commission pleases, yes.

PN374

THE COMMISSIONER: At which time, Mr Cooper, I wouldn't imagine you would be granted leave.

PN375

MR COOPER: Yes, Commissioner.

PN376

THE COMMISSIONER: I said at which time I wouldn't imagine you would be granted leave.

PN377

MR COOPER: At further conciliations?

PN378

THE COMMISSIONER: If there was a conciliation conference.

PN379

MR COOPER: Yes, I understand, Commissioner.

PN380

THE COMMISSIONER: My purpose of granting you leave was to defend the legal interests of the company as to their obligations under the agreement. Well, thank you very much for your help, everybody. I would just make a couple of observations. It seems to me obviously that the economic cost of this is not the issue for the company, or at least I assume it is probably not, bearing in mind what I have been told about the low rate of resignation, that in the context of the company's operations, the cost of what is being sought would not be the primary consideration and it would be more a matter of policy and labour market and workforce management issues, so I suspect that that is where you will probably have to identify what needs to be agreed in order to get a mutually acceptable result, so I gather - this is just my deduction - that this is one of the incentives, if you like, or disincentives, positive reinforcements or negative reinforcements, in relation to skill retention.

PN381

MR COOPER: Commissioner, I have just been instructed to just raise a couple of very brief points.

PN382

THE COMMISSIONER: Yes.

PN383

MR COOPER: The first is just for the purpose of correcting the record. The appropriate person from the company is Ms Craven to talk to about these issues. Mr Hester may or may not have some peripheral involvement, but Ms Craven has the authority. Secondly, in relation to the question of leave for representation in any future proceeding, the company, of course, reserves its position.

PN384

THE COMMISSIONER: Yes, you can make your applications in due course.

PN385

MR COOPER: Thirdly, without pre-empting where the discussions might go or how they are actually framed, we would just note that there is obviously a no extra claims issue, given there is a no extra claims clause in the agreement, clause 4(d).

PN386

THE COMMISSIONER: That may be your response and ultimately we may have to deal with that. For the time being at least, the union can make an informal approach to you on the basis that rather than seeing this as a claim, you treat it as an extension of the grievance about the October resignation. Does that suit you?

PN387

MR COOPER: Yes.

PN388

THE COMMISSIONER: Very well. Thank you. As I say, I will hold the file. If the parties are unable to reach agreement and think that further assistance by way of conciliation on the part of the Commission would be desirable, it will be available. Thank you.

<ADJOURNED INDEFINITELY [4.35PM]