D2003/37, Transcript of Proceedings [2005] AIRCTrans 1296 (10 June 2005)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 11741-1

SENIOR DEPUTY PRESIDENT LACY

D2003/37

APPLICATION/NOTIFICATION BY AUSTRALIAN MUNICIPAL, ADMINISTRATIVE, CLERICAL AND SERVICES UNION
s.158(1) RAO Schedule - Application for alteration of eligibility rules
(D2003/37)

SYDNEY

10.13AM, MONDAY, 30 MAY 2005

Continued from 25/5/2005

Reserved for Decision

PN1559

THE SENIOR DEPUTY PRESIDENT: Yes, I apologise for my late arrival. Unfortunately I was held up in another meeting. Do not take any notice of that clock up there, by the way. Yes, Mr Kite, you wanted to tender some further material as I understand it?

PN1560

MR KITE: I did. Some extracts from the Optus Employment Partnership Agreement 2003 which Vice President Lawler declined to approve. These were the passages shown to Mr Dennard.

PN1561

THE SENIOR DEPUTY PRESIDENT: Yes, should I mark this then?

PN1562

MR KITE: If the Commission pleases.

PN1563

THE SENIOR DEPUTY PRESIDENT: Yes, all right. I will mark the extract from - it is from the decision, is it?

PN1564

MR KITE: No. This is from the proposed agreement.

PN1565

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1566

MR KITE: The clauses, which is on a prima facie declined to approve.

PN1567

THE SENIOR DEPUTY PRESIDENT: I see, yes.

EXHIBIT #OPTUS 17 EXTRACT FROM THE PROPOSED AGREEMENT

PN1568

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1569

MR KITE: Also arising out of Mr Dennard's evidence we indicated that we would probably tender some documents which were attached to Mr Cooper's statement filed in the proceedings.

PN1570

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1571

MR KITE: Being various industrial instruments prevailing between 1992 and 2003 at Optus. The relevant annexures are CC5, 6, 7, 8, 9,11, 12, 16 and 17.

PN1572

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1573

MR KITE: The relevance of them is to show that there was continual right of access for unions covered by the agreement throughout that period. Indeed, in similar terms to the - not precisely the same terms but in similar terms to that contained in Optus 17.

EXHIBIT #OPTUS 18 ATTACHMENTS CC5 TO CC9, CC11, CC12, CC16 AND CC17 FROM THE STATEMENT OF
COLIN COOPER

PN1574

THE SENIOR DEPUTY PRESIDENT: Yes?

PN1575

MR KITE: There was only one other matter, your Honour, and that was in relation to the number of ASU members in South Australia.

PN1576

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1577

MR KITE: Some confusion has arisen over the information conveyed to the parties on Friday and the evidence of Mr Dennard. As we understood it, Mr Dennard indicated there were seven members and that we were interested in knowing their joining dates compared to the join dates with Optus.

PN1578

THE SENIOR DEPUTY PRESIDENT: Yes. I think there was some communication between your instructor and my associate about that, was there not?

PN1579

MR KITE: There was, your Honour.

PN1580

THE SENIOR DEPUTY PRESIDENT: My associate spoke to me and I indicated that I was not prepared to - just bear with me a moment. In any event, Mr Kite, you just remind me what was your question about that.

PN1581

MR KITE: Our interest, your Honour, was the number of members and whether they were members prior to joining Optus; how many of them were members prior to joining Optus. That is, those that have retained their membership from earlier employment and the other concern was, your Honour, that your Honour indicated to us that there were 10 members who were employees of Optus.

PN1582

THE SENIOR DEPUTY PRESIDENT: If I could just interrupt, that included
the - - -

PN1583

MR KITE: Expressions of interest or bargaining agent.

PN1584

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, the bargaining agent.

PN1585

MR KITE: The three of those continued as Optus employees.

PN1586

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1587

MR KITE: I thought that may have been it but we simply wanted to clarify that.

PN1588

THE SENIOR DEPUTY PRESIDENT: Yes. Well, I am not sure that they were continued members or whether they were new members but I will confirm that in a second. I am not sure whether the people who asked for representation were members. Perhaps I could ask Mr Nucifora.

PN1589

MR NUCIFORA: Sorry, your Honour, without going to the names I think the explanation would be Mr Dennard answered that there were seven current members and he had a record of that.

PN1590

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1591

MR NUCIFORA: I have forgotten the exhibit number for that, and it also showed when those members joined as members and then I - well, some of those overlap with people that pleaded - requested representation, out of the 17 as I recall. I think that maybe the explanation for the three would be people that were members but are not members at this point in time or at the time when the latest record was made, where we had seven. It was clear that we have seven members at this point of time and that when we look at the bargaining - sorry, the request for representation, out of the 17 some of those were members and some of them may have been members at the time they were completed and are now no longer a member. I am thinking that is three of them but I couldn't identify who they might be. But that is by way of an explanation of why there is 10 when you look at all those names, as opposed to, of course, seven current members.

PN1592

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1593

MR KITE: I wondered, your Honour, whether the 10 represented the number of people who are either members or sought to have the ASU act as bargaining agents, who are now employees of Optus?

PN1594

THE SENIOR DEPUTY PRESIDENT: Now employees of Optus?

PN1595

MR KITE: Yes. As we understood it, your Honour had a list of current employees.

PN1596

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1597

MR KITE: And a list of members and a list of people who were bargaining agents.

PN1598

THE SENIOR DEPUTY PRESIDENT: Yes, yes, that is right.

PN1599

MR KITE: The purpose was to confirm that the seven members were current employees of Optus.

PN1600

THE SENIOR DEPUTY PRESIDENT: Right. Yes.

PN1601

MR KITE: We have assumed that either those seven or most of those seven and perhaps some of the people who expressed interest in having the ASU act as bargaining agent were also still employees of Optus.

PN1602

THE SENIOR DEPUTY PRESIDENT: Yes. Well the seven are still employees of Optus and excuse me looking down here because I can see a record on this computer screen.

PN1603

MR KITE: Not at all, your Honour. We are grateful for your Honour's - for the Commission's assistance in this.

PN1604

THE SENIOR DEPUTY PRESIDENT: There are in addition other persons who are members of Optus. Now the other question I think was whether they joined after they had joined Optus, whether they joined the union after Optus. Two were members of Optus - sorry, were members of the union before they joined Optus and four we can say joined after they became employees of Optus and the other four we do not know.

PN1605

MR KITE: If your Honour pleases.

PN1606

THE SENIOR DEPUTY PRESIDENT: It is not possible to tell.

PN1607

MR KITE: I am sure that will suffice for our purposes.

PN1608

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Nucifora.

PN1609

MR NUCIFORA: Thank you, your Honour. That is all the other preliminary matters for today. I might go to our submissions, our final submissions.

PN1610

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1611

MR NUCIFORA: Your Honour, in the course of these proceedings the ASU has settled objections from all union objectors including the SBA in relation to retail shop employees, the CPUS in relation to the indirect interests they have with the area that we seek to cover in South Australia within Telstra and the telecommunication services industry. We have settled, of course, certainly with those two unions and there are exhibits before you; that is the undertakings that are there. Of course, finally, we have settled with the CEPU which of course is the union that has exclusive coverage at Optus.

PN1612

THE SENIOR DEPUTY PRESIDENT: Yes. May I just indicate that I have also received a letter from the CEPU indicating that they have no objection to the amended application but indicate that they are still unable to sign the agreement because the person who has to sign it is still not available.

PN1613

MR NUCIFORA: Yes, your Honour. Your Honour, I refer you there to the memorandum agreement, exhibit ASU11, the unsigned agreement.

PN1614

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1615

MR NUCIFORA: Of course prior to that in exhibit ASU15 6 there is a reference in the agreement that was reached with the CEPU in relation to their application, being 2003/7, in relation to call centre workers. There is a reference to that, your Honour. I mentioned ASU 15 6.

PN1616

THE SENIOR DEPUTY PRESIDENT: It is 15A6 is it?

PN1617

MR NUCIFORA: 15A6, sorry.

PN1618

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1619

MR NUCIFORA: 15A6, I refer you there. This is the memorandum of agreement reached in D2003/7, the application by the CEPU for various air rules in relation to call centre work and in particular following call centre work from Telstra and Optus and the telecommunications service industry award. I refer you to clause 1 in the preamble. It refers there in the second paragraph and the third paragraph to a provisional agreement reached between the ASU and the CEPU which led to the ASU finally withdrawing their objection in that matter and signing that agreement before you. In the third paragraph the ASU in its application - and of course it refers to this application - it seeks to provide coverage of call centre employees employed by Optus in South Australia:

PN1620

It is agreed that conditions applying to the CEPU application D2003/7 will apply ...(reads)... proposal re Optus.

PN1621

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1622

MR NUCIFORA: That is when we say that the primary undertaking and the understanding that is now not challenged by any of the two unions, of course, was reached in relation to that memorandum of agreement. Of course, Mr Slape, the national secretary of the union, was involved. I think he was in this very hearing room with those discussions before Senior Deputy President Duncan.

PN1623

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1624

MR NUCIFORA: As was Mr Cooper on behalf of the CEPU. Your Honour, in 15A7 there is of course confirmation - as in exchange for the ASU finally executing that agreement there was correspondence from Mr Cooper at 15A7, exhibit 15A7, dated 4 March which goes to - signed by Mr Colin Cooper, provisional president of the CEPU, that's the communications division. He refers to - and I refer you there to the second and third paragraph. In the second paragraph Mr Cooper refers to that he is:

PN1625

Prepared to settle the objection and the CEPU remain firmly committed to honouring an agreement to assist the ASU in achieving this outcome and the CEPU will agree to the rule change application by ASU reflecting this outcome, an amendment to the demarcation order in print K2441.

PN1626

I will come back to that. It says there if it's necessary, your Honour. Of course what we were left with in that, your Honour, is to agree on the final drafting of the MOA that's before you in exhibit 11. We say that this was the most important development in these proceedings as it led - - -

PN1627

THE SENIOR DEPUTY PRESIDENT: In that regard, why did you not seek to vary the order, the demarcation order?

PN1628

MR NUCIFORA: I think we had considered that we could have lodged the application at the same time as these proceedings but we believed that the rule change here is now the primary area of focus with the new legislation in the Workplace Relations Act. We did consider that it was important to have the order varied and I will come back to that. I think we should do that.

PN1629

THE SENIOR DEPUTY PRESIDENT: Well, if you are going to address it I do not want to change your - - -

PN1630

MR NUCIFORA: Yes. But there was a conscious decision to proceed with what was considered then, back in 2003, section 204 and now schedule 1B section 158, was because with the new legislative scheme under the Workplace Relations Act we have an emphasis on the rule change whereas with the old Industrial Relations Act, where a lot of the demarcation orders under section 118A demarcation orders were made[sic], we were under a regime where that would have to come first and of course it did come first. Whereas we say now that the power will survive of 118A in section 158(7)B.

PN1631

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1632

MR NUCIFORA: 7A and B. Of course 118A no longer exists, we are now under section 133 and the threshold there is a lot higher, of course, to achieve that outcome. Since we have had the Workplace Relations Act the main focus of attention has been the amending of eligibility rules. Now, your Honour, the CEPU have not yet signed the memorandum of agreement but as we heard in the witness evidence at paragraph 698 from the CEPU divisional president Mr Colin Cooper and the CEPU legal representative, Mr Shaw, at paragraph 290 and of course you have mentioned two correspondences you have received from
Mr Shaw; they are committed to the agreement and have withdrawn their objection accordingly.

PN1633

Your Honour, once the agreement is signed - we believe that there is every chance that it will be signed - that we would classify it as a schedule 1B section 158(5) undertaking and the MOU should be treated as such once it is executed. Your Honour, if in the worst scenario it was not signed Mr Shaw has referred to an earlier position on what the rule change should be which still refers to the first licence carried and that definition. Your Honour, we would prefer if it were not signed that we would go back to the position we put on 26 April 2005 and that was the first amendment that was sent to the parties that went to, once again, reflecting coverage of call centre employees in South Australian call centres without the reference to transmission and transmittee and that really is the major difference between the two positions at the time. We would prefer that there be a signed agreement and I will come back to why that is.

PN1634

There is, of course, an emerging pattern that has occurred right across the call centre related industries where all the unions with an interest have reached similar agreements and it's our preference to have that discipline through the, if you like, memorandum of agreement; a discipline that is then between the parties should there be - and the union will say should there be any tension in the future that that would be resolved by firstly referring it to the disputes procedure through to the ACTU and ultimately through a private arbitration before the Commission.

PN1635

THE SENIOR DEPUTY PRESIDENT: How much longer should I wait for the signed agreement?

PN1636

MR NUCIFORA: Your Honour, Mr Tighe, the national secretary of the CEPU, would sign that agreement. He is overseas until 6 June.

PN1637

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1638

MR NUCIFORA: I think at that point in time we would be seeking for the agreement to be executed soon after that. My understanding is that the CEPU, of course, have three executive officers that need to get together to ensure that is finally signed off as per their rules. Now, we know from the advice that they give and they have been giving all along, including in their application, goes to following the advice of that whole division, of course, that's affected by the rule of change, the communications division. We know from that division that there is no concern with the MOA, that even it ought be signed. It's our belief that - and where there would be a 90 to 95 per cent certainty, that that should be signed. I can't give a guarantee here. Unfortunately it isn't signed yet.

PN1639

I think at that time if it was not signed then we would seek to notify the Commission of what the alternative submission would be. As I have put to you already that there is a preference for, if we don't reach agreement, that we go back to the position that we put in our letter of 26 April and that would be the major difference. But of course that is not our preference. Our preference is to reach agreement on all issues and have the agreement signed through you. I would say within 7 days after 6 June would be a period of time that that should happen.

PN1640

THE SENIOR DEPUTY PRESIDENT: Okay. Well, I say okay, subject to what Mr Tighe says about it.

PN1641

MR NUCIFORA: Sorry, your Honour?

PN1642

THE SENIOR DEPUTY PRESIDENT: I say okay subject to what Mr Kite says.

PN1643

MR NUCIFORA: Yes. Well, your Honour, I think on that point I have had discussions with Mr Cooper and Mr Shaw and the Sydney office of where
Mr Tighe would normally be if he were not overseas. It's my understanding that that timeframe should be sufficient and we would ensure that, by written communication, if nothing had occurred that in fact we put an alternative position.

PN1644

THE SENIOR DEPUTY PRESIDENT: Yes, all right.

PN1645

MR NUCIFORA: Your Honour, in relation to the provision that we are seeking to vary. At the moment it's part II sub rule (5)(b) under eligibility for membership and of course it's (5)(b)(iii) that refers to all persons employed by the first licensed carriers, carriers as defined hereunder or in or in connection with the telecommunications industry. It goes on of course to define what first licensed carriers means in A and B. Now, we would seek to remove all that and replace it - sorry, all of that was of course a proviso, it was an exclusion under our clerical rules so at the end of that it will always read "are not eligible for membership of the union". So the new subclause (3) that we would seek to replace with that is the clause set out in the final agreement and - sorry, your Honour. The wording in that just to be clear of course is as per exhibit 11 and clause 1(iii) would now read:

PN1646

All persons employed by SingTel Optus except persons employed by SingTel Optus in...(reads)... or a company in the Optus Group.

PN1647

So the MOA that executed that would be - which we believe it will be - that is the agreed amended clause, of course subject your Honour to your powers that you have to amend that amendment as a result of any submissions made by Optus or in fact your view on what ought be clear under our rules.

PN1648

Your Honour, should the Commission consent to this variation the ASU would have eligibility to cover Optus employees, as I mentioned, employed in call centres in South Australia as per ASU industry rule 5, industry eligibility sub rules (5)(a) part II which of course refers to clerical industry; and in 5(b) part II any clerical capacity - - -

PN1649

THE SENIOR DEPUTY PRESIDENT: What sorts of persons do you say that would include?

PN1650

MR NUCIFORA: Sorry. If we go to, your Honour, the union's rules.

PN1651

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1652

MR NUCIFORA: The extract of our rules are exhibit 16.

PN1653

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1654

MR NUCIFORA: Your Honour, we are referring there to rule 5 and firstly in 5(A) part II - this is the description of industry:

PN1655

The industry in or in connection with which the union is formed is without in any way limiting the generality of the provisions of rule 4 eligibility of membership part II and the construction proper of any time or times to be placed thereof in the clerical industry.

PN1656

So we say that is the relevant description of the industry provisions. If I take you to what is page 7 of exhibit 16 under part II this is then - sorry, 5(b) part II eligibility for membership; at the bottom of that page it reads:

PN1657

The union shall consist of all persons engaged in any clerical capacity and or engage in the occupation of shorthand writers, typists and all calculated billing or other machines as designed to perform or assist in performing any clerical work whatsoever.

PN1658

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1659

MR NUCIFORA: They are the key words and of course it then goes on:

PN1660

Notwithstanding any to the contrary contained in this rule exclusions -

PN1661

It talks about, of course, in (i) the Federal Police and (ii) the Australian Customs Service and then in (iii) there is a provision of course that is before you in relation to first licensed carriers and of course that went in as a result of the section 118A application made by Optus and the CEPU in relation to Optus. It is that clerical work whatsoever, your Honour, that we say that applies to the Optus call centres in South Australia as a result of the proposed rule amendment.

PN1662

THE SENIOR DEPUTY PRESIDENT: Well, what do you say that includes thought? I mean, does it include the operators on the switchboards or you have mentioned billing earlier and accounts and those sorts of things?

PN1663

MR NUCIFORA: Yes. Customer service, call centre employees that are involved with customer service, with billing, accounts, with up selling, marketing and if there are clerical admin duties or as what we might quite often call back office duties in the call centre, then we would have coverage of those by way of the rule change.

PN1664

THE SENIOR DEPUTY PRESIDENT: Is there any sort of occupation or classification within a call centre that you would not cover?

PN1665

MR NUCIFORA: Yes. Generally speaking if an employee is more of a - has technical qualifications or professional qualifications. Sometimes you have people on a help desk, in particular. When I say that, your Honour, we would not say that every help desk in every call centre has as its substantive duties more technical or more professional, if you like, competencies required. But if a help desk requires someone who has technical knowledge and technical skills that relate to work within the industry, in this case whether it be the internet or whether it be mobile phones in other call centres, there may be more technical competencies that are required; then we would say if that's there substantive function then we would not cover them. If their substantive function - - -

PN1666

THE SENIOR DEPUTY PRESIDENT: Who would cover that? CEPU?

PN1667

MR NUCIFORA: CEPU. Yes, your Honour. I refer your Honour to the Telecommunications Services Industry award.

PN1668

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1669

MR NUCIFORA: I don't' actually have a copy here.

PN1670

THE SENIOR DEPUTY PRESIDENT: That is all right.

PN1671

MR NUCIFORA: There is two streams.

PN1672

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1673

MR NUCIFORA: That is two streams that has a - well, it actually has three streams. It has clerical admin, it has a contract call centre stream and it has a technical stream. Now the clerical admin and the contract call centre stream have a lot of overlap if you look at the descriptors. There is not that same overlap with - at least in terms of the award in relation to technical employees. But when we say technical employees, your Honour, we are not just saying technicians and traditionally we might have said, going back in time, that someone was a clerical admin employee handling billing and customer service or selling from the office, we might have referred to technicians and it was clearly identifiable. When we say in any reference in these proceedings and in our discussions with the CEPU reflected in the memorandum of understanding - memorandum of agreement, sorry your Honour, we would refer to people employed in a technical capacity. Not just technicians because increasingly more and more technicians or people with technical qualifications are working in call centres or in an office environment.

PN1674

Once again, technology has changed the way the work is being done. It's not too dissimilar to the matter that was before you in the NUW application in relation to the sales reps and commercial - as they're referred to under their rules - commercial travellers, where more and more of their work was not being done on the road but in fact within an office. Now there are some grey areas, we don't deny that your Honour, in all call centres and there are places where we are the only union. We use the - well, I was going to use the example of Virgin mobile, but in fact, in that award there is no technical stream and there are no technical employees identified so there may be help desk people there and they may have technical professional qualifications that are required but our understanding there is that over 90 per cent of them are really customer service focussed and they are really encouraged - yes, to troubleshoot but they are really encouraged to get new subscribers and certainly service the ones that they have.

PN1675

There is evidence before you that more often than not we would be able to distinguish between an employee in a call centre who is more a technical employee as an IT, if you like, help desk person as opposed to a customer service representative or a customer service call centre worker that may be involved with some billing - sorry, with troubleshooting but with certainly customer service, billing and accounts and sales. Your Honour, I think the difficulty we have in any rule and in fact even in a memorandum of understanding is codifying every last clerical job and I think this comes up traditionally as a result of the definition of clerical work whatsoever. Your Honour, if I can refer you to an authority in my table of authorities in relation to - as a decision of Justice Sheldon in the Federated Clerks Union v the AWU.

PN1676

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1677

MR NUCIFORA: Your Honour, I apologise for the quality of the copy but it's really at 421 that we see that Justice Sheldon - sorry, this is in relation to a demarcation between the FCU and the AWU in New South Wales. In deciding the demarcation dispute, his Honour's reference to any clerical capacity whatsoever has quite often been used by decisions in relation to this, after that time. But at page 421 the key part of it is that top paragraph. I won't take you through all of this because I will quote back what he says here in another decision.

PN1678

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1679

MR NUCIFORA: But it really goes to the broad meaning - definition of engaged in any clerical capacity or as in this case, as under our Federal rules and under the award there, the State award, any clerical capacity whatsoever is read quite broadly. He even indicates there that the concept is - sorry, this would be halfway down the paragraph that:

PN1680

Perception is fluid and progressive and a recourse to a dictionary gives only partial help.

PN1681

That is back in 1971 with the changes in technology, of course, we had back then. But it really is an authority or a decision that has endured since then and in particular, more recently - and this is where if I may I refer then back to that authority - is the Kingmill decision, Kingmill or Thrifty Car Rental v the FCU New South Wales branch. If I may table that as the first authority.

PN1682

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1683

MR NUCIFORA: Your Honour, that is a decision that has been recognised by employers and by unions - certainly by our union. It was a Full Bench of the New South Wales Industrial Relations Commission but it was recognised as a decision that confirmed if you like in the private sector that the FCU or the ASU and most State clerical awards covered call centre employees, particularly those employed in this case, reservation consultants, retail sales officers and this whole principle of what their substantial function was and their principle purpose in any clerical capacity whatsoever. It was an appeal by the employers in relation to a decision of Justice Glynn in the first instance but if I refer you there to paragraph 16. They refer to:

PN1684

Her Honour then considered the authorities which had discussed the phrase "employed in a clerical capacity". In that respect, her Honour adopted the approach of Justice Sheldon in the Federated Clerks Union of Australia New South Wales branch v the AWU at 419 at 421 -

PN1685

That was the arbitration in New South Wales in 1971:

PN1686

- in which his Honour stated that the work of clerical employees included administrative duties and was not restricted to recording functions. The duties of the clerical employees in that case included negotiating with suppliers to obtain goods at the best possible price.

PN1687

Your Honour, if I could take you to paragraph 45 the Bench go to say in the preliminary quote:

PN1688

The questions raised in this matter is whether the employees perform work in any clerical capacity whatsoever within...(reads)... of office administration are in my opinion prima facie covered by this constitutional rule".

PN1689

His Honour continued:

PN1690

Although it is not decisive it would be unreal to ignore the categories of work which for many years have been covered by the many awards relating to clerks. These categories are varied indeed and have been described in a number of judgments.

PN1691

Your Honour, they go on to say on the next page, at the bottom of the second paragraph:

PN1692

I am satisfied that they are employed in a clerical capacity as that phrase is to be understood in 1971.

PN1693

Of course they go on in paragraph 50 to once again indicate the undesirability of trying to codify clerical work. If I may refer you to the end of paragraph 77 on page 231 of that authority:

PN1694

It is the actual duties of the employees engaged in the process of renting vehicles which must be assessed in...(reads)... detract from this finding. Nor does the fact that the employees engage in some limited activities -

PN1695

Which her Honour found to be in the nature of sales:

PN1696

- were inconsistent of itself.

PN1697

So your Honour the question there was whether these people were more in a sales position or in sales and in fact at the end of the day the Bench upheld the decision of Justice Glynn and clerical work whatsoever, even if it really was at the end of the day the standard function or the primary purpose that led to their conclusion that she was right and that anyone working in a call centre, at least at Thrifty - and of course we have since then other confirmations that in fact call centre workers or customer contact workers are covered by the ASU and by the various clerical awards.

PN1698

Your Honour, we say as a result of those key authorities for clerical work whatsoever that the rule change is as particular as we can get. I think an issue has been raised by Optus that there is - I think that they have reserved their position on whether they are pursuing particularity of the rule change and we say that we have tried to be as specific as we can and we have defined the employees that we are seeking to cover with the rule change to call centre employees that are eligible to join the ASU through the clerical capacity at call centres of Optus in South Australia.

PN1699

Your Honour, in relation to narrowing down of the application we know from the Act in section 158(2) where it reads:

PN1700

The Commission may consent to a change or alteration in whole or part.

PN1701

We say that you do have power, your Honour, to amend the application underpinned by the jurisdiction of the original rule application and what we have referred to as a narrowing down of the rule amendment has occurred similarly in other rules matters before the Commission. I refer you here, your Honour, to the matter dealt with before yourself and that is the Tennex matter, CPSU application to vary the rules in relation to traffic enforcement in Victoria, D2003/3. Your Honour, the print number is PR925207. That is the decision, sorry, consenting with that application.

PN1702

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1703

MR NUCIFORA: That was dated 24 January 2005. Your Honour, if I may hand up a copy of that decision.

PN1704

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN1705

MR NUCIFORA: Your Honour, in that decision you accept the narrowing down of the rule change as a result of agreement reached with the ASU in particular but also other unions, the NTU, the AEU and the CEPU and those ..... are referred to in paragraph 11 of the decision. Your Honour, you do go on in that decision - I won't go to all the detail but you do in fact change the rule again as a result of submissions made and as a result of - as you found that there ought to be further clarification of the application of the amendment. So we say, your Honour, that given that it's a narrowing down it ought not affect any other party.

PN1706

THE SENIOR DEPUTY PRESIDENT: Are you talking about your amended application?

PN1707

MR NUCIFORA: The amended application.

PN1708

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1709

MR NUCIFORA: Yes, and we refer to a further decision recently in the CEPU matter D2003/7, the matter heard before Senior Deputy President Duncan and in that decision - the print number for that decision is PR957101, the decision handed down on 7 April 2005. If I may hand up a copy of that authority. In that, your Honour, Senior Deputy President Duncan found that all matters were settled with all the objectors, all the unions and they, in particular the CPSU[sic] and the ASU objectors, there was an amended application. I refer you there to paragraph 16 on page 3 of that decision where the ASU's objection was withdrawn in return to the CEPU amending its application to the following and that was - - -

PN1710

THE SENIOR DEPUTY PRESIDENT: Sorry, where is that?

PN1711

MR NUCIFORA: Sorry, that was at paragraph 16 in the decision there of Senior Deputy President Duncan.

PN1712

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1713

MR NUCIFORA: There was significant amendment. Originally the rule change was quite broad. They sought to cover, in effect, every call centre employee in the country and we narrowed it, after the discussions that are referred to in these proceedings along with - a three-way discussion ultimately with the CPSU. It was narrowed down to, exactly as I referred to earlier in these proceedings, what the CEPU needed. That was in the ability to be able to follow call centre work out from Telstra, Optus and of course the telecommunications services industry. Now that was certainly a narrowing down and his Honour indicated - I think he refers to it as a narrowing down of the original application and gives some credence to the settlements reached with the various unions.

PN1714

But in fact the language used in the amended- in the agreed rule change is modern language. It was not the sort of language that was used in the CEPU's pre-existing rules. It was specific to the core telecommunications players, if you like, and where they had existing coverage and referred to in paragraph 17 after the new amended rule:

PN1715

The memorandum for that agreement goes to the exhibit. There are other arrangements detailed in the memorandum and significantly there are provisions for demarcation issues for resolution of disputes and union organization of specific entities.

PN1716

So while they had inclusions in there - we sought to exclude improvement in certain areas, that went into our various memorandums of agreement rather than add extra text to the rules, which we believed was unnecessary. But the text of the rule went to the heart of where they have core areas of coverage and of course seeking to follow that work out. Your Honour, I may come back to this but while we are looking at that authority, his Honour in paragraph 23 refers to undertakings from the CEPU as being:

PN1717

Appropriate to avoid demarcation disputes that might otherwise arise from an overlap between the eligibility rules of that organization and the eligibility rules of the other organizations and in particular the CPSU and the ASU.

PN1718

He does deal there with a question you raised earlier, in the last two sentences in relation to - he refers to section 2046A which is about agreements reached by consent.

PN1719

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1720

MR NUCIFORA: Then in relation to section 2046B which are demarcation orders, he mentions:

PN1721

Finally, on this aspect I am not satisfied there is no evidence that the matter mentioned in section 2046B are established.

PN1722

So there are no extant demarcation orders but he does go on to say:

PN1723

In view of the changes to the legislation, this provision is for practical purposes irrelevant but in accord with the legislation referred to in paragraph 2 I consider the application under section 204.

PN1724

He does make a comment in passing there about the practical relevance of that provision but I will come back to the legal and practical relevance of extant orders with what was section 204, now schedule 1B, matters.

PN1725

THE SENIOR DEPUTY PRESIDENT: It might be an appropriate time for me to indicate that the ASU, you no doubt are aware, lodged an application on Friday to vary the order made under section 118 in relation to call centres in South Australia and that has been allocated to me.

PN1726

MR NUCIFORA: Yes, your Honour.

PN1727

THE SENIOR DEPUTY PRESIDENT: I do not know whether Mr Kite is aware of it or not?

PN1728

MR KITE: Mr Nucifora advised those instructing us that the application was to be lodged. We were unaware that the matter would be allocated or had been allocated to your Honour.

PN1729

THE SENIOR DEPUTY PRESIDENT: Do you have a copy of it?

PN1730

MR KITE: No.

PN1731

THE SENIOR DEPUTY PRESIDENT: No. I will arrange for my associate to get you one. It has only just come to my attention, actually.

PN1732

MR NUCIFORA: Your Honour, I have got a copy here.

PN1733

THE SENIOR DEPUTY PRESIDENT: Fair enough. Thanks, yes. You need not deal with it now. I just thought it opportune to mention it, seeing that you were dealing with 2046.

PN1734

MR NUCIFORA: Yes, your Honour. I will come back to that application.

PN1735

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1736

MR NUCIFORA: Your Honour, in relation to the authority we have already referred to in your decision of your Honour to consent to rule changes following an application by the CPSU in D2003/3, we have mentioned already in these proceedings that there are three critical issues that arise and that is the comparative capacity of the ASU in respect of membership and their representation and that as per 1584 the Commission must not consent that there is an other organization to which the persons could more conveniently belong and that would more effectively represent those members. Secondly, whether the proposed rule is ambiguous or likely to create confusion or uncertainty about the class that would become eligible for membership of the ASU as a result of the change. Thirdly, the question of the potential for demarcation disputes and the disruption that such dispute would cause in the business conducted by the employer.

PN1737

I would add there is a fourth major issue as per section 158(7) relating to the effect, of course, you have already talked about; the effect of the alteration on a now section 133 or previously section 118A order and whether this could give rise to a serious risk of a demarcation dispute which would harm the business of the employer. Finally, of course, discretionary considerations in the public interest as per section 158(8). Your Honour, before we go to those critical issues you need to be satisfied that the ASU has made the application to change its eligibility rules in accordance with the rules of the ASU.

PN1738

THE SENIOR DEPUTY PRESIDENT: I can indicate that I have examined the material in relation to that and I am so satisfied.

PN1739

MR NUCIFORA: Yes.

PN1740

THE SENIOR DEPUTY PRESIDENT: Subject to Mr Kite having an opportunity to convince me otherwise but I understood Mr Kite was not going to pursue that aspect in the application in any event.

PN1741

MR KITE: In accordance with the agreement.

PN1742

THE SENIOR DEPUTY PRESIDENT: Yes, thanks Mr Kite.

PN1743

MR NUCIFORA: Yes, thank you, your Honour. There was the authority of Senior Deputy President Williams in the ASU matter in print S7852 about the process that we applied.

PN1744

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1745

MR NUCIFORA: Your Honour, in relation to the comparative capacity there is witness evidence in this matter that confirms the ASU can better represent and call centre workers can more conveniently belong to the ASU. Firstly, in terms of the class of employees affected by the proposed rule alteration, not this call centre work in the South Australia, we refer there to the witness evidence of Mr Andrew Dennard. In his witness evidence, your Honour, he indicates the ASU has considerable experience in representing call workers in South Australia and that is the relevant class that we are talking about, is call centre workers in particular of that State. Of course, in terms of comparison with like employees outside of South Australia there is my own witness evidence which attests to the fact that the ASU has widespread coverage.

PN1746

THE SENIOR DEPUTY PRESIDENT: Sorry, you said call centre workers in South Australia.

PN1747

MR NUCIFORA: Yes.

PN1748

THE SENIOR DEPUTY PRESIDENT: It is call centre workers of Optus, is it not? Optus call centre workers?

PN1749

MR NUCIFORA: Optus call centre workers, yes.

PN1750

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1751

MR NUCIFORA: That is the relevant class and in terms of a comparison of like employees we would refer to first up call centre workers in South Australia but of course then we would refer to the ASU's ability to serve - to represent call centre workers in in-house call centres and in contract call centres right across the private sector, right across the country, in most industries. A lot of that evidence is before you in terms of firstly I mentioned the witness evidence of Mr Dennard and your Honour I take you there to - and of course in his statement he refers to the various areas where there are call centre workers. That 's in exhibit 15G1, his witness statement.

PN1752

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1753

MR NUCIFORA: In 15G1 in paragraph 8 he refers to a number of, if you like, in-house call centres right across. That's one branch now so they have coverage of local government of course and a lot of what were traditionally Federated Clerks Union areas of coverage such as the South Australian TAB, is a traditional call centre. There are customer - there are call centres within the telecommunications and related industries such as there are members of EES. He refers to further on 10 to Link Telecommunications, ComSkill and LineOne; they are in that related telecommunication services industry. In that area of call centre I refer you to paragraph 14 of his witness evidence, 20 per cent of the 6700 members in South Australia actually work in call centres right across the board.

PN1754

THE SENIOR DEPUTY PRESIDENT: Work in call centres in South Australia.

PN1755

MR NUCIFORA: Sorry, your Honour?

PN1756

THE SENIOR DEPUTY PRESIDENT: Of the 6700 members of the branch,
20 per cent work in call centres in South Australia.

PN1757

MR NUCIFORA: In South Australia.

PN1758

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1759

MR NUCIFORA: Of course within Mr Dennard's witness statement under the subheading "Optus" and in paragraphs 27 through to 31 there is a reference to the union's activities in Optus and how there were employees that were employed under the generic title of customer service representatives or officer or administration and there were pre-existing ASU members, of course, who have taken up employment with Optus and of course we have in paragraph 30 references to the various communication or newsletters that went out to people that were members as we have recognised there were - there are members of the ASU employed by Optus; and of course people that requested that the union act as bargaining agent or acted on their behalf in some capacity.

PN1760

Your Honour, the other areas that we - the other witness statements that I seek to take you to in relation to our coverage in the call centres nationally is my own witness evidence. Your Honour, in that witness statement - - -

PN1761

THE SENIOR DEPUTY PRESIDENT: This is your witness statement?

PN1762

MR NUCIFORA: That's my witness statement, sorry.

PN1763

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1764

MR NUCIFORA: In exhibit 15B and this is in terms of our union nationally. I indicate at paragraph 13 that there is extensive coverage under our clerical rules across almost every major industry that we can think of under those - in the private sector under those dot points. Of course we don't - we have a demarcation agreement with the finance sector union in relation to finance sector workers and the banking industry. We don't have coverage of Commonwealth and State public servants as a result of the demarcation order that we have in that area. We refer to some of the related industries, certainly pay television. There is the Foxtel and Austar awards where we now have coverage and both - as a result of a contested dispute finding we are now parties to the Foxtel and Austar award, in particular in relation to their in-house call centres.

PN1765

Global Telesales, which was considered - there is some argument about that in paragraph 15, whether that was a contract call centre or whether it was an
in-house call centre. At the end of the day there is now an enterprise award in relation to that particular call centre employer. Virgin Mobile is one that has been - a company that I refer to in paragraph 16 in a matter that I was involved with. It's certainly a company that is involved in the telecommunications services industry and was involved with the original dispute finding that made - where an award was made by consent in relation to the telecommunications services industry, although there were no members of the CEPU or the CPSU. Ultimately the ASU did have members and there was no argument there that we had coverage of call centre employees. If I might hand that up as just a copy of that award. A copy of the award and the decision that went with it, it was a decision of Commissioner Smith. Your Honour, if I take you to the decision in print number PR939547.

PN1766

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1767

MR NUCIFORA: A decision of Commissioner Smith in relation to a dispute - well, it arose out of a dispute finding that the ASU had with Virgin Mobile. There was no argument between all of the relevant parties. The CEPU had an indirect interest but as I was saying before, there were no technical employees there but there was a concern from that union and certainly on behalf of the CPSU in relation to whether the ASU would be recognised in the telecommunications services industry. As a result of this decision, Commissioner Smith found an enterprise award. The original application by the ASU was to be bound by the technical - telecommunications services industry award on the basis of our dispute finding with Virgin Mobile. In his decision he mentions in paragraph 3:

PN1768

I am anxious to maintain the existing relationship of union coverage of the enterprise while at the same time seeking to ensure that demarcation disputes do not arise between the CPSU and the ASU in either a real or perceived sense. It is a matter of public interest that the demarcation disputes should be avoided.

PN1769

In particular in paragraph 4, your Honour, he mentions:

PN1770

The unions in this industry have taken very positive and active steps to ensure that demarcation disputes do not divert the focus from proper terms and conditions of employment. The proposition I put to the parties early in the proceedings was designed to complement those positive steps taken by the unions not to undermine them.

PN1771

He goes on to say that the ASU would be the union with coverage under this award, given that it had the members and the CPSU after a period of time could proceed - if they did have members they could proceed with becoming a party to that award. Your Honour, I mentioned further proceedings, a pattern emerging of there being cooperative arrangements between the various call centre unions and that is probably, if you like, at the cutting edge in terms of award coverage. In an area where there is certainly overlap there was no dispute between the parties and certainly the Commission did not find in the end that once we had members we served the log of claims.

PN1772

There were clerical admin employees, they were employed in the private sector, we were not excluded from that area, we had constitutional coverage and the unions had as a result of our interest in call centres and gaining membership there - because they were not otherwise being organised by the other unions, it has now of course encouraged the unions to work more closely and more cooperatively on an organising basis rather than just a traditional drawing the line of differences in our various overlapping areas of coverage. The award - - -

PN1773

THE SENIOR DEPUTY PRESIDENT: You have mentioned call centre unions. Who do you say that involves? CPSU, CEPU and the ASU?

PN1774

MR NUCIFORA: They are not the only call centre unions, your Honour. There is also the NUW because of their coverage of sales-related employees. In fact, that might be an appropriate time to hand up a copy of the contract call centre award. If I can hand that up and it will show you that in terms of the contract call centre industry - this is a consent award made by Commissioner Smith in relation to consenting contract call centre employers and it was certainly as a result of a consent position reached between AIG on behalf of some consenting contract call centre employers and the ASU, the CPSU and the NUW. At this point it didn't include the CEPU because there were not seen to be technical areas of coverage but we would consider the CEPU as part of the broader call centre unions. We mention the ASU, the CPSU, the CEPU, the NUW because of their coverage of sales employees in call centres and the FSU, of course, at the call centre - - -

PN1775

THE SENIOR DEPUTY PRESIDENT: Were all unions involved in the call centre matter before the Full Bench?

PN1776

MR NUCIFORA: Yes. I was about to say, in terms of this award we can't classify this as an industry award because it's still a matter before the Full Bench of the Commission.

PN1777

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1778

MR NUCIFORA: Whether there is an application by the various unions involved, particularly ourselves and the CPSU and - - -

PN1779

THE SENIOR DEPUTY PRESIDENT: Who had the major running in that case?

PN1780

MR NUCIFORA: The ACTU and the ASU and the CPSU. The ACTU coordinated it on behalf of - - -

PN1781

THE SENIOR DEPUTY PRESIDENT: Yes, I understood that but I just wondered which of the unions.

PN1782

MR NUCIFORA: The ASU has dispute findings and coverage and membership with each of the major contract call centre employers and in particular the ones that are outstanding are Salmat, Teltek and Sales Force. The only one that's not their major national contract call centre employer would be Sytel and in relation to one of the employer applicants in that matter we had - the ..... we settled with that particular employer and they have now consented to being bound by - well, they did consent prior to the end of those proceedings before the Full Bench to being bound by this award.

PN1783

It's recognised by the ACTU, by the various unions, by most employers that we have dealt with, that the ASU has broad coverage and the issue is how the ASU then settles that broad area of coverage or the overlap with the other unions that have traditional areas of work being done by call centres, such as sales reps, such as - I mentioned before the FSU have got coverage of call centre employees in the banking industry and there is a demark there. But if that work is outsourced then the principle of that union following that work out, is one that more - that is the question that we have dealt with and one that we have tried to deal with cooperatively. Of course we did it with the CPSU in relation to Pannex for the outsourcing of work there. Once again, that was work that was once done by the Victorian public service and now being referred back to - now going into the private sector, an area where there is overlapping area of coverage. I think that has probably been more the question rather than whether the ASU has coverage in these areas, your Honour.

PN1784

THE SENIOR DEPUTY PRESIDENT: Yes. No, I knew it was not a question of coverage. I was just wondering who. I knew the ACTU had coordinated it, I was wondering who had the major running, though, from the union's point of view.

PN1785

MR NUCIFORA: I would say the ASU and the CPSU in that matter. The NUW were party to that in the end. In terms of which had the most at stake and the most - we had members with all those employers involved. The CPSU have a significant area at stake because increasingly more and more work is contracted out to call centres such as Salmat does Telstra work.

PN1786

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1787

MR NUCIFORA: Teltek does Telstra work at Moe and they have organised that site so there is certainly that overlap and we would have to say without a doubt the biggest area of potential conflict between any two unions is between - apart from the traditional one in the telecommunications, would be between our union and the CPSU.

PN1788

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1789

MR NUCIFORA: I mean traditionally the old FSU and in the mid to late 90's the ASU would say well, that has been privatised. It's now our area of coverage and that's the end of the story. But in fact, in the emerging pattern that I mentioned before, that has all changed. The ASU has a very broad area of coverage because of what I mentioned earlier in terms of clerical work whatsoever and that definition in the private sector. In that broad area of coverage there is increasingly overlapping areas of coverage and we seek to resolve that with the unions that have the traditional core coverage of those people. If our union is in a better position to organise those people, then increasingly there is agreement between the unions on how we should do that.

PN1790

In saying that, your Honour, there is an ACTU document that goes to - a few ACTU-related documents or union documents that go to the relationship between the unions and they are all in 15A or attachments to 15A. It shows you the history of cooperation between the call centre unions and in particular at 15A1 there is a record of findings and Commissioner Smith refers to a contract call centre award coverage union agreement 2003. So there was agreement reached between the three unions there on how we should deal with the contract call centre. That led to a recommendation in 15A2. That recommendation was made prior to the consent award being signed off by the various unions. In 15A2 that refers to contract call centre and the three unions involved in the call centre dispute resolution procedure.

PN1791

Attached to that in appendix A is the call centre coverage protocol and it's in that protocol - I refer you there to paragraph 2, the last sentence:

PN1792

Without limiting the scope of any union's rules it is acknowledged that the ASU has extensive coverage of contract call centres.

PN1793

So there is an acknowledgement by the ACTU, by the various unions involved, that we have broad coverage and that is increasingly becoming an overlapping coverage with other unions and as per 15A, the three - of course that was a withdrawal of an objection we had n a dispute finding between the CPSU and Sytel and the employers. It includes various other contract call centre employers and of course you would recognise in 15A4, your Honour, a matter that was before you in D2002/21, an application by the NUW. Once again, one of the call centre unions in terms of sales - people who are employed in a substantial capacity as a sales rep are covered in - if you look at the language in that MOA in clause 2 the rule change was deliberately drafted to reflect the decisions of the Commission and the courts in relation to clerical work whatsoever. That is in HA of the agreement rule:

PN1794

Persons employed wholly or substantially in a clerical administrative capacity.

PN1795

So that primary purpose or that substantive role comes up in that agreement with the NUW, which of course settled what they needed in terms of their rule change and the - that was when we talked about the time of the modern commercial traveller. The MUAA matter in 1505 was in relation to the pay television industry, in particular Foxtel and Austar, where the MUAA agreed in that situation to withdrawal from call centres because as every union agrees, with any remote or active interest in call centres, it's a difficult area to organise. There was an agreement with our union to move out of call centres - servicing call centres in Foxtel and in Austar in particular. More recently there was the CEPU application but your Honour I won't take you to all the detail but there is witness evidence, of course, on behalf of Ms Stitt and Ms Cargill in Victoria in relation to similar areas of coverage and activities that were involved with the call centres in Victoria. Of course, there is the witness evidence of Mr Rudi - Mr Oppitz in relation to New South Wales.

PN1796

So in those two major states there is significant activity in relation to call centre work. That's not to say that, as has come through I think with all the witness evidence, the ASU and the CEPU in this area, it is an extremely difficult area to organise. We don't - we believe there is a lot more improvement that we could make and the penetration of membership in call centres is not very high right across any industry apart from in-house call centres such as in the energy industry, such as the TAB's, airlines of course. Where there is high levels of membership with other workers traditionally, then we've got high levels of membership within the call centre. But with call centres that are still on their own, particularly contract call centres or new call centres that are set up, increasingly they have become difficult areas to organise. The turnover is high and we have heard that in witness evidence before you.

PN1797

Your Honour, in terms of we mentioned South Australia and in evidence given by Mr Dennard he indicates that with the industrial staff that he has there and the infrastructure, he referred to 15 industrial officers. Most of those have as part of their work some activity in a call centre so with that level of resource in South Australia - of course the South Australian branch of the CEPU sought to work with our branch including at Optus and we say that certainly the South Australian branch of the ASU is well resourced to service the interests of Optus call centre workers. Of course Mr Dennard went to representations made to the State government, active involvement with the United Trades and Labour Council and as I mentioned earlier, in fact involved in joint campaigns with the CEPU in South Australia. At one stage there was assistance sought by the Victorian of the CEPU in relation to this area of coverage.

PN1798

We are not saying in all of that - and we know already what the numbers are in terms of actual members and people that were interested at any one time in having the ASU represent their interest; they are not large numbers but in the context of the level of membership within Optus we know that there are not very high numbers at all. Mr Cooper in his witness evidence indicated when he was in the witness box that there is a low level of membership right across Optus. We don't know what the exact membership is but we would imagine it would be far less than, say, Telstra if that's any comparison. Because of the traditional union culture within Telstra it's a lot higher we would imagine. The problems the CEPU had with Optus are the same sort of problems that we have in the private sector.

PN1799

To gain membership is extremely difficult and we say that the CEPU, having withdrawn their objection and having - and now acknowledge at least through that withdrawal that the ASU can at least service call centre employees in Optus as well as they perceive they can. At least in South Australia there is an argument that in fact only with the two unions working together could we make any advancement in terms of the call centres there.

PN1800

Your Honour, in terms of the convenience of the relevant class, communicative interest reports - and there is evidence before that confirms the ASU has, as I have indicated already, many members engaged in call centres performing customer service and sales-related work right across the private sector. We have indicated all those areas where we have either - well, what we can hope for will be an industry type award, a contract call centre industry award although we can't call it that just yet. If the Full Bench finds in favour of the ACTU and the three unions' applications then we are hoping that there will be one industry award. If there is not one industry award, there would be - similar to the Virgin Mobile award - separate awards with the contract call centre industry award being generally consented to by the other - the contract call centre employers who we were seeking to rope in.

PN1801

There were only a few issues that we differed on and of course one related to hours of work and I think the other was part of the classification structure. So if we don't have one industry award for contract call centre employees there will be possibly a Sales Force or a Teletek award with some variation to the main industry award. That's what we believe would be - and because of the areas of consent between the ACTU and the employers involved. Your Honour, we have referred to already that there is evidence by Optus that shows that it has become more customer focussed. You have heard from Optus witnesses that most of the call centre employees are employed in customer service.

PN1802

Now I refer you here to the witness evidence from the company secretary,
Mr O'Brien, in paragraph 27, 28, 51, 54 and 59. I could take you to those, your Honour. I have already referred to them but there is clearly a reference there by Mr O'Brien, the company secretary, that they moved away from a product service type organization to a customer service. We have also got witness evidence from Mr Meyrick in paragraph 9, 10, 11, 12, 13, 14, 15 and 16. I think it's important just to - I won't take you to all those paragraphs but they relate to the emphasis on customer service. But in paragraph 16 of Mr Meyrick's witness statement, this is in exhibit Optus 9, if I may quote from that:

PN1803

All employees working in a general frontline customer service role in the South Australian Optus call centres are required to have the capability to provide customer service, troubleshooting and telephone communication skills. These employees are not required to be technically qualified.

PN1804

I think there are, as I say, various - another paragraph earlier on in Mr Meyrick's statement he goes to - in paragraph 14 of his statement:

PN1805

The majority of employees working in the South Australian Optus call centres are employed in frontline customer service roles.

PN1806

So most of those paragraphs I have referred to, your Honour, by the company secretary Mr O'Brien and Mr Meyrick, confirm as we find with most call centres but with some slight variation of course in terms of those duties, are generally involved and principally involved with customer service. Not unlike a lot of organizations who are moving to - trying to get more subscribers in and probably not having as many people as everyone would prefer in our servicing and maintenance area. I will include unions in that. I mean, unions are employing more organisers rather than - and people who get more new members in and I think it's something that goes right across the board; that is private companies seeking to get new customers and the focus is on that and if someone is in a customer service role then they may be required to pick up some technical skills along the way.

PN1807

Your Honour, in terms of the potential of demarcation disputes harming the business, your Honour there is witness evidence from Mr Slape at paragraphs 66, 67, 617, 618, 665 in relation to demarcation disputes between the two unions and that in fact there have not been any of note. Unless we start to refer to our interests in the energy industry and of course that would be, in terms of the CEPU, talking about the trades area or the old ETU coverage of the CEPU. Mr Dennard referred to spats between the unions in South Australia in that area but in terms of the witness evidence of myself and Mr Slape and Mr Dennard, when it certainly comes to the communications division of the CEPU there are no real demarcation disputes.

PN1808

Any disputes may have been at their worst paper disputes like the one now here before you that we have resolved. In none of those - in all of that witness evidence, and Mr Draper was also asked in cross-examination, no one is aware of the business being affected including in this case Optus, by any demarcation disputes between the two unions. Indeed in South Australia in
this - - -

PN1809

THE SENIOR DEPUTY PRESIDENT: I think Mr - - -

PN1810

MR NUCIFORA: Sorry, your Honour.

PN1811

THE SENIOR DEPUTY PRESIDENT: Sorry. There was some evidence, was there not, that there has been some disruption to Optus as a result of having to deal with staff confusion or enquiries about the relevant union?

PN1812

MR NUCIFORA: Yes. Yes, and I think in relation to handing out leaflets in the car park and your Honour when Mr Draper was asked about that his response was that it was not in the form of harming the business; it was one that went to dealing with a distraction or an annoyance - annoying, I suppose, to the company from their point of view. But we would say it should be put no higher than the evidence of Ms Salomon as put in, in relation to entry in the workplace. In her statement, Ms Salomon goes to - and she is not the only CEPU witness that goes to that type of evidence. She says in paragraph 4 - - -

PN1813

MR KITE: I will just interrupt there. I am reluctant to do so, but Ms Salomon's evidence is not in as we understand it other than paragraph 11 and the annexure it refers to.

PN1814

MR NUCIFORA: I won't go to it, your Honour.

PN1815

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1816

MR NUCIFORA: Your Honour, we are aware that Mr Cooper went to this too, that there are problems with accessing the workplace for the union that has coverage, although there is of course acknowledgement in the agreements and I think there was a consent award in relation to access to the workplace. But we would say that any of the problems that are encountered by Optus in relation to the ASU trying to hand out leaflets in the car park ought not be put any higher than those they would say they have with the CEPU. We say, your Honour, that they are no in the - it does not arise as a result of demarcation between the two unions. It arises out of one union, that is the ASU, seeking to inform other employees of Optus that they are seeking to represent them and giving them an option.

PN1817

Of course as result of that, we are aware at least in terms of evidentiary material before you, that there were at least 17 people that sought to pursue that and there were people who either joined in a period round - most of them round a period in 2003 or were pre-existing members from working as - as members of the ASU working elsewhere such as Ansett or wherever in a call centre in the private sector; and sought to have the ASU continue as their representative. We say that the South Australian branch of the CEPU and the ASU have worked together and we know through the memorandum of agreement before you that there is a dispute centre procedure to deal with any potential area of dispute; any grey are that we talked about earlier.

PN1818

Those memorandum of agreements are not meant to settle forever and a day all differences between the two unions. They are really a mechanism to ensure that the two unions will in fact - if we are in a competitive environment, compete in a more positive way rather than in a negative way between themselves or in a negative way that would harm the business. That is, there is a process. We know from the MOA that we would go to the ACTU to seek to resolve it there and ultimately to the Commission for a private arbitration to deal with the merits of the respective areas of coverage.

PN1819

I mentioned earlier that this reflects the emerging pattern of cooperation that we have with the other call centre unions and we say, your Honour, that this is probably one of the last pieces of that whole jigsaw, if you like, of that pattern that was emerging in the call centres. It may not be the last but certainly we have got to a point after - when the call centres got together before the ACTU in the late 90's, round '99, 2000, when the differences between particularly ourselves and the CPSU were at their greatest. The CEPU and the CPSU were having their own problems with telecommunications. Of course the NUW were seeking to pursue their interests in terms of the modern commercial traveller.

PN1820

All of that we have sought to resolve painstakingly, I would have to say, because there are in all of our unions traditional thinking which says this is our patch and you shouldn't come onto that. All of that has arisen because of the new environment we have got. We have got legislation of course recognising overlapping areas of coverage and competitive unionism is no longer discouraged. So the unions have sought to resolve that without having to resort to litigation.

PN1821

THE SENIOR DEPUTY PRESIDENT: Would you put it higher than that? Competitive unionism is encouraged?

PN1822

MR NUCIFORA: It's not discouraged. Encouraged?

PN1823

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1824

MR NUCIFORA: It may be with the changes. I think we are part of the way to a position where -this is only by way of comment, but where we are heading towards more competitive unionism and in fact traditional unions will be - there will be competition with enterprise unions. The original changes went through to enable enterprise unions to in fact - - -

PN1825

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1826

MR NUCIFORA: That was not the outcome in practical terms. It involved much litigation between various unions and in particular we were involved with the NTU higher education matter where large sums of money were spent. Of course there was the CFMEU AWU matter where reportedly some $2 million was spent by both unions. I think all up there was about $3 or $4 million spent at least on heavily litigated cases that go to rule overage.

PN1827

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1828

MR NUCIFORA: That was referred to in the CFMEU Full Bench matter by the Bench headed by Vice President McIntyre, that in fact the unions had spent a lot of - the last paragraph of that decision referred to the unions having spent a lot of money on - - -

PN1829

THE SENIOR DEPUTY PRESIDENT: More recently referred to, I think, by Justice Moore in the Federal Court.

PN1830

MR NUCIFORA: Yes, your Honour. So we have had to give up, as I mentioned before, some old thinking that we all had. I mentioned with the Federated Clerks Union it was always the case that as soon as someone was privatised from the public sector - and in this case it would be Telstra - that they would be covered by our union and that was it. Of course the ASU no longer has coverage in the public sector apart from the Tax Office. But we have had to change our thinking in all of that. It is a very large area of coverage. No union has sufficient penetration in that area apart from I mentioned a number of in-house call centres.

PN1831

But call centres generally, and now we include some of the modern telecommunication related areas - and I would include between Optus and that, penetration is nowhere near as high as it once was for the CEPU and the CPSU with Telstra or for our union in the airlines or in the TAB. Your Honour, in terms of the extant demarcation order we refer to section 158(7). We say virtually, your Honour, we mentioned earlier - I think we tendered a copy of the application to vary the order. If I could - - -

PN1832

THE SENIOR DEPUTY PRESIDENT: No. You have not tendered that.

PN1833

MR NUCIFORA: Sorry, your Honour.

PN1834

THE SENIOR DEPUTY PRESIDENT: I have had a copy provided to me.

PN1835

MR NUCIFORA: Sorry. I was not going to tender that - table that, but everyone has got a copy. Under section 133 parties to a, in this case an old section 118A order, are able to vary the order if it is necessary. What we have sought to do and I have mentioned earlier in proceedings if we sought to pursue the application before you and if you found in favour of the union in terms of the merit argument, then we would seek to vary that order in any case. Particularly if you required it to be varied and we would think that as a matter of course we would want to vary it in any case, so there is no inconsistency for practical and legal reasons between the existing demarcation order and any rule change. But your Honour we say in the application - and we have referred it to yourself.

PN1836

I think you mentioned n the course of these proceedings that it probably would be a separate line of enquiry, because at one stage we were thinking of lodging the application at the same time - the 133 application at the same time as the application to vary our rules. But if there is a separate line of enquiry then we believe that that should be pursued if you find it necessary and I will come back to that and why you might find that it is necessary. But in terms of the application here it is very much a minimalist approach. In the applicant we have - I don't have the order here, your Honour, but we are adding the words "provided that the ASU shall have the right to represent the industrial interests of employees employed by Singtel, Optus and call centres in South Australia".

PN1837

We have made a minor change to reference to the ASU. It's a minimalist approach. We have tried not to - we certainly have not sought an application to revoke the order and it's one that is varied and it's totally consistent with the agreement that we reached with the CEPU. Of course they had agreed to vary at print K2441, to reflect the agreement that we have reached. So there is agreement from the other union that is bound along with the CPSU, and we refer at the end to the other organization that may have an interest. Optus are not bound by the order but if they were an applicant, of course they would be an interested party or an interested organization in variation to the demark order.

PN1838

We go through the grounds and I won't go through hall of those but of course an important one is - it is something that we say is relevant to proceedings before you now. It is one that complements the terms of an applicant by the ASU and the variation reflects an undertaking given by the CEPU in these proceedings; that is that they would consent to an appropriate variation to the order.

PN1839

Your Honour, we were not seeking to have that - we have lodged it with the industrial registrar and sought to refer it to yourself. We say that if you find that that application would need to be heard before there was any consent to be found in favour of the union, in terms of the merit argument of the case, then we would seek to have that listed as soon as possible.

PN1840

THE SENIOR DEPUTY PRESIDENT: In the absence of consent by all parties then the matter would have to be listed to give that opportunity to be heard.

PN1841

MR NUCIFORA: Yes. Yes, your Honour, we would say that. Your Honour, in fact the example that we would rely on is the NTU matter. I am not sure if your Honour has a copy of it. If I could hand up a copy of the NTU decision in print S9084.

PN1842

THE SENIOR DEPUTY PRESIDENT: Did this matter go to the Federal Court
at one stage?

PN1843

MR NUCIFORA: No. This is the NTU, the Full Bench.

PN1844

THE SENIOR DEPUTY PRESIDENT: Right.

PN1845

MR NUCIFORA: It was the CFMEU matter that went to the Federal Court and became quite complex.

PN1846

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1847

MR NUCIFORA: The reason why I raise this authority, it's the main authority in relation to the new provisions of the Act, section 204 and now schedule 1B. But it is relevant because the Full Bench found in favour of Senior Deputy President Williams on all issues in relation to the no other organization test, the new provisions of the Act, but did not find in favour of his Honour in relation to his reasoning with extant orders. There were two orders involved in that, your Honour. One was a general one that had a life, a higher education demarcation order and his Honour had indicated that it probably had expired and therefore was no longer operative.

PN1848

But his reasoning went to the new 204 provisions overriding the effect of previous demarcation orders and that he went on to say with the Southern Cross University order, there was a demarcation order that it did not have a life. It went on with one particular university and said that regardless of that particular order seemingly being extant - being extant there was no doubt about it as he saw it - was overridden by the new 204 provisions. As I understand from what the Bench was saying, that conclusion was wrong. They were not saying that he couldn't have otherwise referred to what the Act says in 2046B then or now in section 158. Section 158(7) is discretionary and it is a cumulative provision. It says:

PN1849

The Commission may also refuse to consent to an alteration in the eligibility rules of an organization if in (a) the alteration would change the effect of an order made by the Commission under section 133 -

PN1850

Now we would read as 118A:

PN1851

- and (b) considers that such a change would give rise to a serious risk of a demarcation dispute which would prevent obstruct or restrict performance of work in an industry or harm the business of an employer.

PN1852

So it's a discretionary provision and it's a cumulative one but the Bench did say that it was the reasoning that they had a concern with, that in fact you could not just override - as Senior Deputy President Williams was saying - an extant section 118A order. I think you have to look at the nature of that order too and the circumstances as it came about.

PN1853

THE SENIOR DEPUTY PRESIDENT: Is it not this point: even if I consent to the variation or the amendment to your rule, the order would still override the rule would it not; the changed rule, if it is still extant?

PN1854

MR NUCIFORA: Well, part of the rule would not totally override it because if we had - I mean, it talks about in that provision the effect. The order - the Act would contemplate that it can because it's discretionary. It says that the Commission may also refuse consent. Now the reason why that discretion is important is because it was one raised by the Full Bench because of the reasoning given by Senior Deputy President Williams that in fact you could just override the 118A. In fact the circumstances of that particular order or the nature of that order was one, it did arise out of agreements reached with all the unions in higher education, both the orders did and there were no rule changes. So the order was important - had a legal as well a practical effect.

PN1855

Without the order then it could have created disputation across the industry. Whereas we would say in the matter before you now, this has been driven as much as anything by the rule change. In that case, in the higher education matter, there were no rule changes. There were agreements reached between all of the unions before Senior Deputy President Williams originally in the early 90s an then what arose out of that was two demarcation orders; one that was more of a general one that had a life and one that was specific to Southern Cross University.

PN1856

THE SENIOR DEPUTY PRESIDENT: Yes. But see the point I was making to you is if you look at 158(7).

PN1857

MR NUCIFORA: Yes.

PN1858

THE SENIOR DEPUTY PRESIDENT: If I came to the conclusion that a consent to your rule alteration would not alter the effect of that order then the order would continue. You would have a right under your rules to cover but the order would stop you from doing that.

PN1859

MR NUCIFORA: Yes, and we would seek to pursue the application to vary the order.

PN1860

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1861

MR NUCIFORA: You mentioned yourself, your Honour, there is a different line of enquiry but we would think that much of what has been before you here in this matter to be determined on the merits of it, particularly the potential as required in 158(7)(B) for demarcation disputes that may prevent the performance of work. Then we would say much of that would be dealt with in the proceedings before you.

PN1862

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1863

MR NUCIFORA: If not, we would seek to go through similar evidence in that particular application. Your Honour, we did not - given the emphasis now on what was section 204, now schedule 1B, we have always believed going back
2 years that that was the key part of the Act that we had to rely on and in fact ever since the NTU case or indeed the changes to the legislation, that that has been the main emphasis. Your Honour, we would say that there would not be opposition to any variation to that order from the other unions involved and in particular the CEPU. They have indicated that in the memorandum of understanding or agreement.

PN1864

THE SENIOR DEPUTY PRESIDENT: Yes. But I cannot operate on that.

PN1865

MR NUCIFORA: No, no. I understand that your Honour.

PN1866

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1867

MR NUCIFORA: But in terms of Optus we are not sure what their position would be, depending on the outcome of this case here.

PN1868

THE SENIOR DEPUTY PRESIDENT: It is fairly predictable, is it not?

PN1869

MR NUCIFORA: Sorry?

PN1870

THE SENIOR DEPUTY PRESIDENT: It is fairly predictable, is it not?

PN1871

MR NUCIFORA: Well, probably, your Honour. Probably. Yes. We lodged the application because whether it was found to be necessary or not, we would seek to vary it in any case because there could be confusion in time. But I do draw that distinction between the CFMEU - sorry, in the NTU matter that was about overriding the whole order.

PN1872

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1873

MR NUCIFORA: This is changing the effect of an order, in particular in one State.

PN1874

THE SENIOR DEPUTY PRESIDENT: Do you say it does change the effect of the order or it does not change the effect?

PN1875

MR NUCIFORA: We say that it does change the effect of an order as per 158(7)(A) because of how the exclusion applies in South Australia but it's cumulative with B. We don't believe that that change, now with the evidence before you, would give rise to a serious risk of demarcation disputes. Having said that - I mean, we say that's our primary position because it's a cumulative provision, but having said that we don't believe we are overriding the provision but we do believe that there is an obligation on our union, indeed on matters before the Commission, that there be some consistency. So we should vary the order. Of course the order is written in old language. I mean, we are talking about the old unions. We have tried a minimalist approach in varying that order but certainly the order for its legal effect, we would agree, should be amended in time in any case to reflect what is before you.

PN1876

THE SENIOR DEPUTY PRESIDENT: Where is the order? What are the terms of the order again?

PN1877

MR NUCIFORA: The terms of the order?

PN1878

THE SENIOR DEPUTY PRESIDENT: The 118A order, yes.

PN1879

MR KITE: Optus 10, annexure K.

PN1880

MR NUCIFORA: Yes. It's annexure K as my friend, Mr Kite, has informed me. Print K2441.

PN1881

THE SENIOR DEPUTY PRESIDENT: Yes. I have it.

PN1882

MR NUCIFORA: Yes, your Honour. So as you see, there is no life to that order. It continues on as per the Southern Cross University 118A order and therefore is a matter that ought be considered under section 158(7). Of course, as I mentioned earlier, there are all the predecessor unions that are referred to there and the orders are binding on the predecessor unions including the predecessor unions to the CEPU, the ASU and the CPSU. Your Honour, if I could take you to the Full Bench decision in relation to the NTU.

PN1883

THE SENIOR DEPUTY PRESIDENT: Well, just before we leave this order. There is nothing in this order, is there, that required the changing of your rules?

PN1884

MR NUCIFORA: No.

PN1885

THE SENIOR DEPUTY PRESIDENT: This simply demarks the right of coverage to all those unions that are actually mentioned there, the ATEA, AATPOA.

PN1886

MR NUCIFORA: Yes.

PN1887

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1888

MR NUCIFORA: There is a subsequent decision that goes to that, your Honour.

PN1889

THE SENIOR DEPUTY PRESIDENT: So how do you say the change or consent to alteration of your rules would affect that order given that it does not specifically direct the amendment or your rules or the alteration of your rules? At that time there was a subsequent order made, was there not, about the - - -

PN1890

MR NUCIFORA: Yes.

PN1891

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1892

MR NUCIFORA: In dealing with that subsequent order we are changing our rules. The one that needs to be considered is print K2441 which is the demark order that my friend has been referring to all the way through.

PN1893

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, that is what I was referring to.

PN1894

MR NUCIFORA: Yes. So your Honour it is an order that continues on, as we know from the Full Bench decision in the NTU matter but the reasoning in the Bench finding against his Honour, Senior Deputy President Williams, relates more to his reasoning of the ability of the new section 204 provisions to override extant orders. So their reasoning goes to overruling that, if you like, and it was referred back to him and his Honour then called the matter on and in fact set aside that particular order. But the ruling found in favour of the rest of the reasoning of Senior Deputy President Williams in the original matter before him and did not - and the rules did not apply to the Southern Cross University until he then had the order referred back to him as a separate application and he set it aside.

PN1895

So the rule changes were made or reconfirmed or upheld by the Full Bench and the rule change applied right across the higher education, across Australia in terms that the NTU picked up coverage of general staff as well as academic staff, but no in relation to general staff at the Southern Cross University. It was because of his reasoning, we would say your Honour, his reasoning for why he believed that section 204 or how section 204 could override an extant 118A order. But in fact if I can refer you to the Full Bench decision at paragraph 67.

PN1896

THE SENIOR DEPUTY PRESIDENT: The NTU matter?

PN1897

MR NUCIFORA: The NTU matter, sorry.

PN1898

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, I have that.

PN1899

MR NUCIFORA: In fact if I maybe just take you back to get the context of that, to 66, in the first sentence.

PN1900

The appellant -

PN1901

That was the CPSU. Although we were a union involved in that, we were not an appellant and the CPSU appealed the decision:

PN1902

The appellant did not dispute the requirements in paragraphs A and B of subsection 204(6)(B) are cumulative nor was any challenge made to the finding of Williams SDP that paragraph 204(6)(B)(b) had not been established.

PN1903

Then they go to the primary submissions in relation to the construction of the words that changed the effect. In paragraph 67 they go on to say:

PN1904

It was further argued that his Honour's reaching to the conclusion that a rule alteration override a section 118A order...(reads)... consequence, namely the serious risk of demarcation dispute which might arise as a result of consent being granted.

PN1905

We say, your Honour, that - - -

PN1906

THE SENIOR DEPUTY PRESIDENT: But that is the argument, is it not? That was the argument.

PN1907

MR NUCIFORA: That was the argument, yes, your Honour.

PN1908

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1909

MR NUCIFORA: It was the same argument that we have here that in fact - - -

PN1910

THE SENIOR DEPUTY PRESIDENT: Where did the Full Bench finally determine it?

PN1911

MR NUCIFORA: In 81.4, if I can refer you to that paragraph there, the second - in 81.4:

PN1912

The effect of elimination of the use of orders under section 118A for the purpose of structuring an organization's...(reads)... for the purposes of determining whether an eligibility rule should be altered.

PN1913

Your Honour, they do go on to say as I have mentioned earlier, that his Honour was wrong in relation to - - -

PN1914

THE SENIOR DEPUTY PRESIDENT: They refer to it in paragraph 99.

PN1915

MR NUCIFORA: Sorry, your Honour?

PN1916

THE SENIOR DEPUTY PRESIDENT: In paragraph 99 they say that they the reasons are set out in part 12.

PN1917

MR KITE: I think it's at paragraph 106.

PN1918

MR NUCIFORA: Yes.

PN1919

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1920

MR NUCIFORA: It follows in 99 that:

PN1921

His Honour's reasoning about the application, although more effectively represent criteria into the facts of the case was affected by an error of principle.

PN1922

They do say in 109, at the end of paragraph 109, the last sentence:

PN1923

Moreover as subsection 204(6)(B) now implies, an alteration of an organization's and especially an excluded organization's eligibility rule, is not precluded by a pre-existing section 118A order.

PN1924

THE SENIOR DEPUTY PRESIDENT: Yes, all right.

PN1925

MR NUCIFORA: In 113 they confirm:

PN1926

In relation to the first of those we have accepted that his Honour was in error in concluding that a consent order given under section 204 to an alteration of an applicant's eligibility rule overrides the effect of a section 118A order.

PN1927

That was the key area of the concern that the Bench had that in fact the 204 could override the 118A - an extant 118A order. Of course that 118A order had direct application. Our rules had not been changed as a result of the demarcation order. The demarcation order was the only instrument used for demarcation that was binding on the parties in that industry. So your Honour we say that the Act was drafted for that provision to be discretionary and it was cumulative in relation to 158(7)(B) and there is, as we say, evidentiary material before you that confirms that there is not a serious risk as we would say of a demarcation dispute that would harm the business.

PN1928

But your Honour, having said that, we have still sought for completeness and to ensure there was no confusion and to also put into effect the agreement reached with the CEPU, an application to vary the original demarcation order. It was never the intention of the ASU to either seek to set it aside or to otherwise override it. Your Honour, in relation to the public interest and discretionary test the Commission, as always, should take into account the public interest in assessing whether to grant the application and of course we refer to the objects of the Act. We know from the NTU matter, and in particular the original decision of his Honour and supported by the Full Bench, that the changes to the Act in effect remove monopoly union coverage rights, encourage overlapping coverage and most importantly introduce the concept of competitiveness.

PN1929

As for the Full Bench decision in NTU, the Commission must take into account the new legislative scheme where not only are employees free to be join an organization, they should if they choose to join an organization be free to join the organization of their choice. Of course, competition between organizations for membership and representative rights are no longer discouraged. The relevant objects the Commission should take into account in the exercise of its discretion under the public interest test should be - and we refer to section 3F ensuring freedom of association including the rights of employees to join an organization of their choice; and also ensuring that employee organizations are representative and accountable to their members and are able to operate effectively.

PN1930

That was in the objects and is now in section 5A of schedule 1B. Your Honour, Optus are seeking for the Commission to refuse consent and we would say that they are seeking that contrary to the preference of those employees of Optus seeking to be represented by the ASU. Of course we know of at least seven members and at least 17 employees who sought to have the ASU act as a bargaining agent. We believe that Optus is seeking for the Commission to act against an express object of the Act.

PN1931

There is evidence, as we mentioned, of the ASU membership within Optus call centres in South Australia and of course we say - and Mr Dennard said in his witness evidence - there has been no active recruitment after the Vice President Lawler decision in 2003; although we were are from the records there was at least one person that signed up at that time but that was not to the knowledge - that was not Mr Dennard and the executive, if you like, and for that matter probably the organiser. But certainly from his witness evidence, he was not aware that someone had signed up after that date. We have indicated there are a significant number of employees employed in Optus call centres confirming their interest.

PN1932

I say significant although they don't seem large numbers when you look at the overall numbers of employees in the call centres in South Australia; when you compare that with the low levels of membership across Optus. We know from Mr Dennard's evidence that he was not aware of too many members that he did come across. We do not know the exact numbers of members but we would say initially we were referring to 20, 25 but we have only been able to confirm on evidence at least 17 with an interest and seven members. But we say that is not insignificant when you look at penetration of call centres generally in the private sector, apart from those where they have been traditionally unionised, as I mentioned earlier.

PN1933

Your Honour, Optus have raised the issue of conduct. I believe it's conduct that they are referring to and this has been raised before in relation to rules matters; it's conduct of the ASU prior to any rule change. We refer to the Full Bench case in the CFMEU matter. If I can refer you to the CFMEU Full Bench decision, it was an appeal to a decision of Senior Deputy President Williams. The decision is in print S90 - sorry, that's the higher education matter - that was in print PR901486, an application by the CFMEU in the construction industry; one that I mentioned earlier where a lot of money and resources were spent by the two unions.

PN1934

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1935

MR NUCIFORA: They refer there that his Honour ought to have considered the type of conduct the CFMEU were involved with prior to the application and that it ought not reward that type of conduct. The CFMEU had been involved in recruiting members and there was sufficient - there was a lot of evidence by the employers in that industry that that was creating - that was harming the industry, there were demarcation disputes. Your Honour, we put to Mr Draper, the witness for Optus in this matter, whether there was any comparison with the sort of demarcation disputes that he was referring to and Optus were referring to, paper disputes we might like to call them, between the ASU and the CEPU, or traditionally in this industry, the CEPU and the CPSU and the telecommunications industry.

PN1936

But he agreed in his witness - under cross-examination that there was really no comparison between the building site demarcation disputes, if you like, and the waterfront demarcation disputes and disputes that might occur between what is essentially white collar areas of coverage between the ASU and the CEPU. Nonetheless, in that matter, in the CFMEU matter, the Bench found that Senior Deputy President Williams ought to have considered that conduct and ought not to have rewarded it. Your Honour, there is evidentiary material by Mr Slape, to some extent myself and certainly Mr Dennard in terms of the behaviour of the South Australian branch in trying to improve on the interest that was shown either by pre-existing members or people who wanted to join.

PN1937

Around that period of time in 2003, after having abided by the order - this is the ASU having abided by the demarcation order for some time - there was a question about whether in the - as we saw in 2003 leading up to the enterprise bargaining negotiations that we sought to test. It was a question mark about whether Optus had not changed to a point where it was no longer the company it was when it was created; it was no longer as we believed at the time, a traditional telephone company. It had moved into pay television, into the media generally. Of course, his Honour Vice President Lawler found against the union and up until that point we were recruiting members. Some of those would be amongst the seven, possibly amongst the 10 and certainly amongst the 17 that sought to request the ASU represent their interests for enterprise bargaining.

PN1938

The branch believed that to be a legitimate activity. In fact, if they did not do that in other workplaces, the branch nor the union would survive, particularly in the private sector. If we did not have branches, if you like, at that cutting edge recruiting new members through the car parks and standing out in front of buildings, hopefully within the laws that are necessary there - and Mr Dennard was here, we believe in good faith they were seeking to do that - there really is not much other opportunity to recruit new members to organise or to build on organising opportunities as a result of some of the people showing concern. Within that period around 2003 we did believe that we could test the ability of the ASU to represent our employees and we tried every avenue there was.

PN1939

THE SENIOR DEPUTY PRESIDENT: Well, you did not come to the Commission or go to the court.

PN1940

MR NUCIFORA: No.

PN1941

THE SENIOR DEPUTY PRESIDENT: Or seek any determination on the issue.

PN1942

MR NUCIFORA: No.

PN1943

THE SENIOR DEPUTY PRESIDENT: Other than to start recruiting members.

PN1944

MR NUCIFORA: Not until the enterprise bargaining agreement was then certified and leading up that point all the attention of employees revolved around the enterprise bargaining negotiations. So to seek meet and confer rights we did actually - in fact, your Honour, we would say we sought a certificate from the registrar, which we achieved once we had employees sign the authorisation for the union to act on their behalf. Prima facie that - - -

PN1945

THE SENIOR DEPUTY PRESIDENT: What is the criteria for the certificate? It is 170 - - -

PN1946

MR NUCIFORA: Your Honour, in terms of 170 and bargaining agent, we had to have employees - and of course that led to us having intervention rights in the certification proceedings. Prima facie the registrar issued a certification in relation to the ASU acting as bargaining agent under 170 and I guess, your Honour, we would say that that is the equivalent to what you are asking about having some recognition before the Commission of the ASU. Because if we were not able to act as bargaining agent we could not otherwise have been - we would not have been recognised for what was the main activity at the time, the enterprise bargaining negotiations.

PN1947

THE SENIOR DEPUTY PRESIDENT: Yes. All right.

PN1948

MR NUCIFORA: That was just one level of representation. Of course, employees were saying can't the ASU represent us? Those who were already members had been employed by Ansett or in the private sector outside of Optus and then were now working for Optus were saying how can the ASU represent us? When I put that question to Mr Dennard he had indicated at least four or maybe five ways of trying to cover people. One, of course, was as bargaining agent authorised by the employers involved. Another was as members and that was to be tested, of course. As direct members, the way we would prefer if we had coverage. Another way was as individuals, representing individuals which we believed with section 170LK agreements normally a disputes handling procedure would recognise someone who could represent the employee so an employee of the union may act as an individual.

PN1949

In fact can intervene in section 170LK proceedings as an individual and not as an employee or representative of the union. So that while the union may not have collective rights, there may be people that can act on behalf of a group of employees before the Commission. So we sought that private, if you like, individual representation. We also sought to represent people by providing legal representation in terms of workers compensation. So there were a number of ways that we were seeking to address what the Act says and its object; the object of the Act that employees ought have freedom to choose which union they could use.

PN1950

In the course of that the ASU sought to - I don't there was any doubt amongst employees that there was some doubt about whether we could cover them because of the demarcation order, because of all the communication they were getting from Optus about the demarcation order and our rules. So the issue was out there and I think the question has been raised by my friend that it was not an informed choice. In fact there was plenty of communication coming out from the company. The ASU had raised certainly on several occasions that there was this issue that we were trying to address at various levels and from the ASU's point of view if we didn't have the union and the branches and organisers handing out leaflets in car parks or indeed, if there were not emails like we get spam emails now - Mr Dennard indicated that emails are quite often sent to other workplaces not just to Optus - if they did not have that opportunity up against a multinational like - a corporation like Optus, they just would not get anywhere.

PN1951

Of course they can meet with people after hours and they did try that but in terms of selling their wares, they felt that the only way they could do that was following the procedures that they did. We do not compare that with the sort of conduct, at all, that was raised by the Full Bench in the CFMEU matter. There were real concerns with disputes that would harm the industry. I think the employers had about 100 witnesses that went to how traditional demarcation disputes between the CFMEU and the AWU had wreaked havoc in the construction industry. That is not the case here. Any harm that Optus say that they may have had as a result of the ASU officials being around was not as a result of a demarcation dispute with the CPSU - CEPU, but if anything as a result of the ASU seeking to represent its members or to in fact organise and recruit new members.

PN1952

Your Honour, there is another decision that I think my friend will take you to, that I don't have a copy of here; the CFMEU matter. A decision of Vice President MacIntyre.

PN1953

THE SENIOR DEPUTY PRESIDENT: Do you know how much longer you might be?

PN1954

MR NUCIFORA: Another 5 minutes, your Honour.

PN1955

THE SENIOR DEPUTY PRESIDENT: Yes. Sure.

PN1956

MR NUCIFORA: Sorry. Your Honour, it was referred to in the Full Bench matter but that matter went to the Federal Court and became quite complex in the end.

PN1957

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1958

MR NUCIFORA: But it was an issue raised. The issue of the conduct of the CFMEU and in this case here, which is a lot clearer because in my understanding this is as far as it went, the question of the activity of the CFMEU before they had eligibility to cover, that is actively going out there recruiting employees. What his Honour says is whatever opinion we might have about that - and it may be very strong , the employers and the AWU had a very strong opinion about that - that conduct ought be weighed against the employee choice; the right of the employee to choose which union they should belong to. In the end he found in favour of employee choice because it was a weighting exercise and the behaviour of the union in trying to sign up employees as members, that is the CFMEU and certainly in a much more aggressive way than we have here, is one that has to be weighed with the objects of the Act in relation to the right of employees to choose which union they think they should belong to. Sorry, I don't seem to be able to find the exact wording there, your Honour.

PN1959

MR KITE: Paragraph 66.

PN1960

MR NUCIFORA: Paragraph 66.

PN1961

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1962

MR NUCIFORA: Thanks. As I said previously at Comalco Weipa:

PN1963

The CFMEU is not entitled to enrol production employees. The AWU is virtually non-existent and those...(reads)... or not to join a union and (2) if they do, to join a union of their choice.

PN1964

So in the end, your Honour, he weighed it up and found in favour of employee choice.

PN1965

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1966

MR NUCIFORA: That was in an environment that was a lot more aggressive. They don't get any more aggressive, if you like, in terms of demarcation disputes from the CFMEU and the AWU. Whatever aggression ourselves and the CEPU and the CPSU might have had has always been in either the four walls of this Commission or in the four walls of any one of our offices or the ACTU. We are not aware, at any stage, of those sort of demarcation disputes having harmed business. With the sort of evidence put before you in the Tennex matter where once again that arose; the issue of demarcation between the CPSU and the ASU and once again we have always sough to resolve our differences without harming business. That is reflected by the disputes handling procedure that we apply in all of those agreements, ones that we would rely on here.

PN1967

Your Honour, there is of course evidence before you which goes to the two unions in South Australia already having worked together and had our original claim been pursued, our original application, there obviously would have been more tension between the national offices of the ASU and the CEPU. That is clearly not the case now and you heard from Mr Slape if anything both the unions are wanting to encourage the two branches to work together as a result of the agreement. We say that on balance, your Honour, the potential for industrial disputation should be outweighed by affording the relevant employees or relevant class of employees the freedom to choose which union they should belong to. We say that there is no reasonable consequences of any demarcation disputes. If your Honour pleases.

PN1968

THE SENIOR DEPUTY PRESIDENT: Thanks Mr Nucifora. Mr Kite, how much time do you think you may take?

PN1969

MR KITE: Your Honour, we have reduced our submissions largely to writing.

PN1970

THE SENIOR DEPUTY PRESIDENT: I am much assisted by that.

PN1971

MR KITE: I will make available copies of that now. It's called outline.

PN1972

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1973

MR KITE: But having regard to questions which have come from your Honour to Mr Nucifora, we have a clear understanding that your Honour understands many of our major points.

PN1974

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1975

MR KITE: So if it's not discourteous, I will go through this fairly briefly. There are a couple of areas I want to deal with at length; in particular an area of the evidence in Mr Draper's evidence, the background material that we did not go to at length last week. The balance of the material, as your Honour will recall, we did take the time to take your Honour to it.

PN1976

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1977

MR KITE: So we don't want to repeat that. My estimate would be somewhere between half an hour and three-quarters of an hour.

PN1978

THE SENIOR DEPUTY PRESIDENT: Would it be convenient to have a luncheon adjournment now and then return after lunch?

PN1979

MR KITE: If that is a convenient course for the Commission.

PN1980

THE SENIOR DEPUTY PRESIDENT: I mean, if you are going to talk half an hour but I might have questions that might take you beyond the half hour.

PN1981

THE SENIOR DEPUTY PRESIDENT: So perhaps we will adjourn till 2.15.

PN1982

MR KITE: If your Honour pleases.

PN1983

THE SENIOR DEPUTY PRESIDENT: Is that convenient for you? I mean, you may have other things you may want to get away to and we can come back earlier if you wish.

PN1984

MR KITE: I would appreciate a slightly earlier start.

PN1985

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1986

MR KITE: I do have a commitment later in the day that I have yet to complete.

PN1987

THE SENIOR DEPUTY PRESIDENT: Okay. Is 2 o'clock enough time?

PN1988

MR KITE: 2 o'clock.

PN1989

THE SENIOR DEPUTY PRESIDENT: Thanks very much.

PN1990

MR KITE: If your Honour pleases.

PN1991

THE SENIOR DEPUTY PRESIDENT: Adjourned till 2 o'clock.

<LUNCHEON ADJOURNMENT [12.36PM]
<RESUMED [1.59PM]

PN1992

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Kite.

PN1993

MR KITE: If the Commission pleases. As I indicated before the adjournment, we have substantially reduced our submissions to writing, and I just propose
to - - -

PN1994

THE SENIOR DEPUTY PRESIDENT: Yes, and I have had an opportunity to read those, thanks very much.

PN1995

MR KITE: If the Commission pleases. In the introduction we have concentrated on the set up of the Optus Group, its business, and its history in the telecommunications industry. We have set out the consortium that was originally established because it will assist your Honour to understand in the making of the original 118A order the concern of the FCU. They were concerned about losing coverage in amongst related companies of the various members of the consortium and that was the principle concern of the union at that time not coverage of Optus. They took very little part in the proceedings. There concern was the scope of the order.

PN1996

We make the point that the original licence holders continue to be members of the group and the licences still exist. They are relevant in terms of determining a first licensed carrier. We refer to section 50 of the Corporations Act in terms of related corporations. We have extracts of the Act if that would be of assistance to the Commission.

PN1997

THE SENIOR DEPUTY PRESIDENT: It will save me having to look them up. That's fine, thanks.

PN1998

MR KITE: Can I hand up two extracts, one dealing with section 50, and another from the dictionary which includes a relevant definition.

PN1999

THE SENIOR DEPUTY PRESIDENT: I won't mark those, Mr Kite.

PN2000

MR KITE: I am not sure that is all the relevant definitions in terms of polling companies, your Honour, but if it's not we will make that available to your associate.

PN2001

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN2002

MR KITE: You will see section 50 is a very brief section.

PN2003

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2004

MR KITE: It doesn't appear to be an issue in any event in proceedings before you.

PN2005

THE SENIOR DEPUTY PRESIDENT: No.

PN2006

MR KITE: We deal in section 2 with the business of the group essentially a carrier product and service provider in the telecommunications industry. You have given references to the evidence in relation to that, and at 2.2 we note that pay TV which at its height was a very small part of the Optus business, it has been significantly wound back given reference to the evidence of Mr O'Brien. Even so, it was always part of the telecommunications industry. The reference we have got there is to the Telecommunication Act 1991 which required pay TV, or carrying services for Pay TV, to be provided by the licence holder. Section 3 deals with the restructure of the group to move to be customer focused rather than a product focused basis and relevant reference is to the evidence.

PN2007

Then in section 4 and 5 with call centres in the group generally there are ten, and in South Australia, three. The work done by employees in South Australia is essentially the same type as that done in Victoria and New South Wales. That is a relevant consideration when your Honour comes to consider the potential for demarcation disputes. Essentially, this case turns upon the ASU acting on some interest whether from employees rightly enrolled and wrongly enrolled as members, rightly by reason of their employment in another employer or wrongly in conflict with the orders of the Commission and the union's rules, but on the basis of that interest seeking to vary the rules and the orders to pursue that interest further. It can only be a matter of time we submit if this application is successful that there will be further competition interstate.

PN2008

In 5.3, we refer to the work done at the internet call centre and technology park which has been referred to as help desk diagnostics and so on. Your Honour might recall in the evidence of Mr Nucifora to the effect that some of that work might be regarded as technical, Mr Cooper thought that arguably not only the work Mr Nucifora thought was technical, but another group of employees might also have been regarded as technical. Again this points up the potential for demarcation even within the agreement between the ASU and the CEPU if that is ever consummated, because the agreement provides for the ASU to have coverage of clerical employees in the call centres, but not technical. In that regard one has to say that the relevant parts here will be persons employed in a clerical capacity in call centres in South Australia by Optus. It is not simply employees in call centres in South Australia.

PN2009

We have given references to Mr Nucifora's evidence to that effect, and your Honour would also have regard to ASU11 in particular paragraphs 1 and 5, 1 being the proposed rule change and 5 being the undertaking not to enrol persons employed in a technical capacity. What that means will be a matter of debate between the unions and potentially something disrupting to the operations of Optus. ASU11 is, of course, not yet consummated, but even if it were, it contains a dispute resolution procedure which does not provide any ..... to refraining from industrial action or any other action which might disrupt the business of Optus.

PN2010

We clearly have an emergence of an area which is ripe for demarcation issues, where at the moment there is none. Because of the 118A order the CEPU has exclusive coverage of employees of Optus. There is no room for debate.
Your Honour in passing during the evidence last week observed that the ACTU as a peak body had a different role under then section 118A in 1992. We just reminded ourselves of the scope of 118A as it existed in the 1988 act, and as applicable in 1992, and the role for the peak body was that the Commission could consult with appropriate peak councils, and where it does so must inform the parties to the proceedings under this section relating to the order of any views expressed by those three councils. That is section 118A(2)(b).

PN2011

THE SENIOR DEPUTY PRESIDENT: Yes, I think that was what I had in mind.

PN2012

MR KITE: It is a consultation that I will - nothing more. We noted that those orders were ultimately made by consent. The evidence of Mr Fox indicates that there was a considerable hearing before then Deputy President Moore before the parties came to an agreement on the making of those orders a hearing in which the FCU did not file any evidence or arguments. Its concern was only about the scope of the order and because of its potential impact in areas outside the workings of Optus that is in the consortium members.

PN2013

In paragraph 6.2 we have set out the arguments as contained in the application, and we deal with those in turn in paragraph 6.3. Might we say that the fact that the ASU can and does represent clerical employees does not advance the argument one iota. The FCU did at the time that the 118A orders were made and the rules were varied. We should say that we do not put in issue the fact that there are persons employed in the call centres in a clerical capacity. What is a matter of concern to Optus is where the line is drawn between clerical capacity and technical, and the fact that the difficulty of drawing such a line will inevitably lead to competition for membership.

PN2014

The evidence as outlined shows that Optus is and always was its own communications company or group. It continues to be a first licensed carrier and its involvement in pay TV and entertainment is negligible in its structure, and to the extent that it is involved, it is involved as a telecommunications carrier essentially. As to call centres, call centres have always been a part of the telecommunications industry at its essence. Call centre employees operate telephones. Telephonists work in the telecommunications industry and always have. Mr Cooper gives evidence of that in paragraphs 38 to 40 of exhibit Optus 3, and the existence of call centres has always been part of the Optus Group strategy. That is the evidence of Mr O'Brien in Optus 7, paragraphs 28 and 30(e).

PN2015

THE SENIOR DEPUTY PRESIDENT: Would the fact that they are predominantly involved in telecommunications preclude the ASU from coverage of clerical and admin workers of itself?

PN2016

MR KITE: In absence of the current rule?

PN2017

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2018

MR KITE: No, certainly not all of them. If people working in the call centres were employed in a clerical capacity the ASU would have rights to seek to represent. Those rights were taken away in 1992. I should just draw a distinction here, we are not talking about contract call centres, but call centres operated within Optus by Optus, and there is a distinction between those two things, because the affinity obviously operating within the group is much closer by operating as part of the group rather then an external service provider.

PN2019

In paragraph 6.3(3) we deal with the insertion of a significant number of persons seeking to be represented by the ASU. It appears at the moment that there are perhaps ten persons, that is seven current members and three persons who at some earlier time expressed an interest in having the ASU represent them as a bargaining agent. That would have been some time in 2003. The significant number at the moment would appear to be somewhere between seven and ten, and that now is the time for the assessment of that evidence might we say and give to your Honour a reference to a decision of Senior Deputy President Williams in the Higher Education (Southern Cross University) General Staff Demarcation Order matter, print S0688, paragraphs 212 to 213. It is also reported in 93 Industrial Reports at page 365.

PN2020

THE SENIOR DEPUTY PRESIDENT: Is this the decision after the Full Bench?

PN2021

MR KITE: Before the Full Bench. This is a point that wasn't as we understand it affected ..... in any sense. It is paragraphs 212 to 213 and it simply stands for the proposition that the time at which the section 204(4) tests are to be applied is the time of the Commission's decision.

PN2022

THE DEPUTY PRESIDENT: Yes.

PN2023

MR KITE: There was some implicit criticism of the CEPU for its success in recruiting office employees in call centres in South Australia, but it has to be said that the ASU has not had very much success having at the moment seven members, and we say that - I think we make a strong submission that throughout its recruitment the ASU has misrepresented its capacity to represent these employees, and it has misrepresented the fact that it's a telecommunications union indeed calling itself the National Telco Union.

PN2024

In our respectful submission the weight that might otherwise be attributed to such number of employees must be diminished by this misleading recruitment trial. We make some further submissions about that later in our outline. We make the point in paragraph 6.3.4 that the experience and resources of the CEPU more than match those of the ASU to represent the class of employees in issue. ..... affinity with the telecommunications industry. Might we say there that the importance of that affinity was reflected in the fact that the ASU sought to represent themselves as the National Telco Union to make that point to these people. Now can we refer to the evidence of the CEPUs unique involvement in both Optus and the telecommunications industry.

PN2025

THE SENIOR DEPUTY PRESIDENT: I have no evidence do I of the CEPU membership in the Optus call centres?

PN2026

MR KITE: No.

PN2027

THE SENIOR DEPUTY PRESIDENT: Generally or in South Australia?

PN2028

MR KITE: Correct. The only thing that Mr Cooper said about that was he didn't think they had lost any members.

PN2029

THE SENIOR DEPUTY PRESIDENT: I don't know if he said that did he? He said there had been none who had resigned go to the ASU.

PN2030

MR KITE: I am sorry I think he went further then that to say that there had been none who had resigned.

PN2031

THE SENIOR DEPUTY PRESIDENT: Did he? I will check. The only reason I make mention of this is because I asked him how did he know they had gone.

PN2032

MR KITE: I think his answer to that was none have resigned or they haven't resigned to go to the ASU. My learned junior will check that reference.

PN2033

MR NUCIFORA: Your Honour, that check was made on the very day or the day before Mr Cooper was in the witness box. There is no evidence of how many members there were though.

PN2034

THE SENIOR DEPUTY PRESIDENT: No.

PN2035

MR NUCIFORA: If there were any, indeed, at all, your Honour.

PN2036

THE SENIOR DEPUTY PRESIDENT: I can have a look at it later on Mr Kite.

PN2037

MR KITE: Then we come to the conveniently belong arguments and reiterate that the CEPU was clearly recognised as the telecommunications industry union so much is recognised in the proposed agreement between the ASU and CEPU. The evidence of Mr Slape and Mr Dennard. Might we say again in this context that Optus is clearly in the telecommunications industry and we refer back to the analysis in paragraph 2 of our outline. Again we make the point that call centres are a key part of the Optus strategy in that industry for achieving customer satisfaction and how that strategy continues in fact has been recently reinforced by the restructure of the business to be customer facing. The call centres operate within the various customer facing units, that is the consumer business and small medium enterprise units.

PN2038

Paragraph 3 on page 9, we refer to the evidence of Mr Meyrick about the internet call centre employees. This is the area of debate about whether or not these people are technical or clerical, and your Honour will see that potentially there are a significant number of the 1,103 employees engaged at that call centre. Again, we make the point that the work done by these employees has a close affinity with the telecommunications industry.

PN2039

In paragraph 4, we make the point that given the existence of the 118A order, the CEPU must be an organisation to which the relevant class of employees could more conveniently belong. That follows and I will come to these authorities in a moment that comes from the fact that while the order is in existence the ASU cannot represent these employees industrially, and if they can't represent them it must be found that they can more conveniently belong to the CEPU. Your Honour, in context we have given references there to the CPSU case recorded in 100 industrial reports. Does you Honour have a copy of this already?

PN2040

THE SENIOR DEPUTY PRESIDENT: Sorry, what one was that one?

PN2041

MR KITE: The CPSU case in 100 IR.

PN2042

THE SENIOR DEPUTY PRESIDENT: Which one is that one? There have been a few CPSU cases. Is that the one that was before me is it?

PN2043

MR KITE: No. But I hand up this. This is a copy of the Full Bench decision. I have been handed a copy of the print.

PN2044

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN2045

MR KITE: You had some discussion with Mr Nucifora about the effect of the 118A orders and the interaction with section 204. In light of that discussion, I thought I should take a moment to analyse the case because essentially the proposition we advance is that on this authority that changing the rules will not affect the 118A order - the 118A order will continue and it will have affect according to its terms thus even though the ASUs rules may commit it to enrol these people, it will not be entitled to represent the industrial interests of these employees.

PN2046

At paragraph 107 on page 350, your Honours said:

PN2047

We foreshadowed in paragraph 98 above that, in our view, a grant of consent under section 204 does not override the legal effect of any existing section 118A order.

PN2048

And records submissions of on behalf of Mr Bromberg then analyse the legislation and indicate that there is no explicit or indeed implicit suggestion in the legislation that a 204 order ..... would override a 118A order. In paragraph 109 about midway through that is five or six lines down the Commission says:

PN2049

The words "change the effect" in paragraph 204(6B) do not mean override. Section 118A orders survive to exist...(reads)... eligibility rule is not precluded by a pre-existing section 118A order.

PN2050

Pausing there, the point doesn't necessarily arise in this case, but second proposition made by their Honours in relation to an excluded organisation, we respectfully submit, doesn't necessarily follow, but we would accept that the Commission as presently constituted would regard that as at least persuasive argument.

PN2051

In paragraph 113, they indicate acceptance this his Honour was in error:

PN2052

- in concluding that a consent given under section 204 to an alteration of an applicant's eligibility rule "overrides"...(reads)... operative, although its effect may continue through an established pattern of industrial representation.

PN2053

So clearly their Honours distinguish between a legal effect and a practical effect, and there may be implications in a practical area, but whatever legal effect there is, it is not to revoke or override. So the order continues on its face and in terms until varied or revoked or set aside.

PN2054

THE SENIOR DEPUTY PRESIDENT: Varied, or revoked or set aside.

PN2055

MR KITE: The effect of that is that the ASU at the moment cannot ask the section 204 test in which case the Commission is obliged to refuse the change. In paragraph 7.2, we deal with the issue of more effectively represent, and we have set out a number of reasons why we submit the CEPU by in a position to more effectively represent then the ASU, and in paragraph 5, repeat the argument of the impact of a 118A order in that context. In paragraph 7.3, we deal with the contravention of an agreement now found in section 158(6) of schedule 1B, and the agreement we refer to is the consent settlement which led to the making of the 118A order. Whatever might be said about why the FCU consented, there is no doubt in our respectful submission on the evidence that they did consent.

PN2056

THE SENIOR DEPUTY PRESIDENT: But the same may be said of the CEPU in relation to the proposed alteration in respect of South Australia, wouldn't it?

PN2057

MR KITE: That they are acting in contravention of the - - -

PN2058

THE SENIOR DEPUTY PRESIDENT: Well, no, that they have consented to the ASU in effect having coverage of clerical administrative employees in Optus call centres in South Australia.

PN2059

MR KITE: Yes.

PN2060

THE SENIOR DEPUTY PRESIDENT: All I am saying is the logic of your argument about ASU consenting to giving it up in 1991 or whatever it was seems to suggest that the CEPU might be taken to have given up the call centre employees in South Australia now.

PN2061

MR KITE: There is a big difference. The CEPU hasn't given up the company, it has just agreed to share it.

PN2062

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2063

MR KITE: It has given its consent to the ASU ..... coverage, whereas the position in 1991 was the ASU surrendered that coverage though its predecessing union in the ..... On one view of it, although certainly not a happy one from my client's point of view, if there was one union which had coverage then at least it wouldn't have a demarcation potential, dispute potential, but this is shared coverage, and that just adds to the overlaid potential demarcation disputes. Although the ASUs role is limited to clerical and administrative employees, the CEPU is not giving up its right to cover clerical and administrative employees in the call centres in South Australia.

PN2064

In paragraph 7.4, we submit that as to the change of the effect of the section 113 order and in that context that goes back to 118, and as your Honour observed it is not so much the demarcation order itself that is effected, it is the consequential order about the variation of the rules, but aimed at the same cause which is to prevent the risk of demarcation disputes arising. Might we say this, the section is concerned not with serious demarcation disputes, but a serious risk of demarcation disputes which cause disruption to the business, so it is not a matter for us to show that the ASU and the CEPU are going to launch into all out warfare on a scale which Mr Nucifora referred to as the AWU/CFMEU battles, but that there is a real, a significant or a serious risk that demarcation disputes will arise.

PN2065

It can't be doubted that that risk exists, we have had it in South Australia already in 2003. The CEPU is opposing the ASU extending its coverage, and did so until recently in this case where it was confined to a settlement in relation to South Australia. How long before we start moving beyond the call centres? How long before we start moving interstate? When those disputes continue and arise, will there be disputes between the ASU and the CEPU about what is technical and what's not. That risk must be held to be in existence we submit, and seriously so. True it is that the extent of harm to the business is not on the scale of the AWU/CFMEU battles in various places, but it undoubtedly causes harm, and
Mr Draper gave evidence of the form of that harm.

PN2066

THE SENIOR DEPUTY PRESIDENT: That is the question though isn't it that the likelihood of harm to the business?

PN2067

MR KITE: Ultimately.

PN2068

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2069

MR KITE: That is that there is a risk of demarcation disputes which will cause harm to the business. So what I am saying to your Honour is the first part of that we can meet on the evidence clearly.

PN2070

THE SENIOR DEPUTY PRESIDENT: You are saying there is no doubt about the risk of demarcation.

PN2071

MR KITE: We acknowledge that the evidence in relation to the extent of the arm is one - is best summarised by Mr Draper talking about the diversion of resources within Optus to cope with issues that arise out of the various strategies of the unions to gain coverage or gain membership, and indeed to relieve the confusion of employees which arise out of that competition. In paragraph 7.5, we move to the public interest considerations and identify three. The first is that the ASU has enrolled persons in Optus whom it is not entitled to enrol. The second that it has defied orders of the Commission, and the third, that the ASU has actively misled employees of Optus in the course of attempts to recruit them, and taken no steps to remedy its conduct.

PN2072

I won't dwell on the evidence that the ASU has enrolled employees whom it was not entitled to enrol. That is not to deny that there may be some employees who were legitimately members of the ASU by reason of earlier enrolment, but clearly there are employees who have been enrolled contrary to the rules and contrary to the orders. Mr Dennard gave evidence that he accepted that a demarcation order which applied to the ASU was something to be observed.

PN2073

THE SENIOR DEPUTY PRESIDENT: Mr Dennard, sorry you might cover this later I think, said in his evidence that there was a belief in his mind at least that the demarcation order no longer had any life or effect.

PN2074

MR KITE: Yes, he did. We will come to deal with that.

PN2075

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2076

MR KITE: Mr Slape said he was aware of the recruitment drive, knew the demarcation order existed, and was concerned about the limitation it imposed on recruitment by the ASU, yet took no steps to prevent the impermissible recruitment. Mr Slape gave us a reason for questioning the applicability of the demarcation order at that time the reference to the first licensed carrier perhaps no longer having application to Optus, and we submit that that is simply untenable, and I will come to some evidence in a moment which illustrates the weakness of that argument.

PN2077

Your Honour put a question to Mr Nucifora today. The short point of the evidence really was the ASU had a bit of an internal discussion, the national office thought there might be an argument that the demarcation order no longer applied, so they would go ahead and ultimately look to test it in the EPA proceedings. Where was the application to the Commission? Where was the application to the court? Where was there any form of legal advice as to the scope of that order? How was this exhausting all possible avenues rather than having an internal chat, deciding there is a potential for an argument, and then shifting the burden to Optus to prove that there is a breach of the order?

PN2078

In our respectful submission, the approach taken can be described as cavalier, a cavalier attitude to their obligations to obey Commission orders, and to act in accordance with their rules. Prepared to assert propositions at law without checking. Prepared to assert propositions of change within the Optus Group without checking. They were prepared to enrol on the basis that they may not be in breach, that it was Optus's problem.

PN2079

THE SENIOR DEPUTY PRESIDENT: Now, just on that point I mean, I can't think of any analogous situations in rules off the top of my head, but it is not uncommon, for example, for employers to dispute that they are bound by awards by virtue of section 149 of the Act which is a provision relating to - - -

PN2080

MR KITE: Transmission.

PN2081

THE SENIOR DEPUTY PRESIDENT: Yes, and which I suppose is the source of the argument that Mr Dennard would put in relation to Aussat and Optus. But again in those circumstances, the dispute is normally only resolved after an employee or union or somebody takes action against the employer for failing to observe the award rather than the employer seeking out a declaration as to his or her or its liability under the award.

PN2082

MR KITE: Well, I can see the analogy that your Honour poses. The difference is the ASU knew that this order bound them for a long time and they acted in accordance with it for 10 years. It is not the same proposition of someone coming along and asserting to an employer, you are applying the wrong award or you are failing to apply this award which that employer then disputes. This is a case where the ASU accepted it was bad, then decided to change its mind, why, because it had five or six members and it thought it could get some more. Ultimately, by getting some members it might have a good chance to overturn the order or at least persuade Optus to change its mind according to Mr Dennard.

PN2083

One would have thought having accepted the binding effect of the order, but taking a view that it may no longer apply, the appropriate course would have been to find out, to check, at least to have taken legal advice on the potential of Optus no longer being a first licensed carrier, or there being some break down in the group so that the relevant employer was not a related entity. These are not secret matters. As your Honour will see, when I come to go through some of this material, when it came to the debate before his Honour the Vice President, the ASU, through their counsel, conceded there was no issue that Optus was a first licence carrier or that the employer was a related entity. The only argument before his Honour was that Optus was now in the pay TV industry, and the rules should be construed accordingly.

PN2084

Can I take your Honour to some of the evidence in the annexures to Mr Draper, which is Optus 12? The first annexure is annexure G.

PN2085

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2086

MR KITE: This is a letter dated 1 August 2003. This is about the time the ASU stepped up its activity in recruitment, and you will see that this is a letter from Mr McIntosh, national employee relations manager to Ms McEwen, branch secretary of the South Australian and the Northern Territory branch. I won't read it all, your Honour, but the first couple of paragraphs make the point that the ASU is representing it has the right to cover. It points out that Optus has on a number of previous occasions advised the union that the CEPU has exclusive rights, and the ASU has not rights, and refers to the 118A order. There is no argument coming back to say that the 118A orders don't apply.

PN2087

Annexure H is a letter dated 12 August from the ASU to Mr McIntosh indicating that the ASU have received requests from employees to represent them and meeting and conferring about the proposed agreement, and referring to section 170LK(5) to meet and confirm. Then a letter of 1 September to
Mr McIntosh and Ms McEwen referring to a certificate from the Deputy Industrial Registrar pursuant to section 170LKA, and the certificate is attached, and your Honour will see that the certificate certifies that an employee has made a request to the organisation, and that Deputy Industrial Registrar has received evidence that the employee made the request. It doesn't say and I certify that the ASU has the right to cover these people, simply that an employee of Optus has made a request.

PN2088

There is a response to that which is the next annexure I dated 18 August 2003 in which Mr McIntosh, on behalf of Optus, makes those propositions including a proposition that the organisation can only act as agent if it is an organisation entitled to represent the person's industrial interest, and making the point that the ASU is not so entitled and therefore has not rights under 170LK(4). There is a further letter from Mr McIntosh to Ms White at annexure J dealing with specifically with the certificate in the second last paragraph having done the analysis notes that the certificate is at no force and effect. The response to that is annexure K dated 17 September 2003 in which the ASU says that it proposes to seek to be bound by the agreement.

PN2089

There is a letter which is annexure N dated 7 October 2003 from Mr McIntosh to Ms McEwen again setting out all of those arguments about why the ASU is not able to represent the industrial interests of employees of Optus, and its concern about the various misrepresentations that the ASU has made in its recruitment campaign. Annexure N is the transcript of proceedings before the Vice President in which the ASU sought to be bound and at paragraph 127, Mr Murphy, who was appearing for the ASU, notes firstly that:

PN2090

There is no issue that Optus was issued with a licence under that Act and that that licence carries over pursuant to the 1997 Act and there is no issue that the employer party to the agreement is a body corporate related to that licence holder

PN2091

And that paragraph 135 he articulates the basis of the ASUs claim, that is, that the rules should be construed in the light of the current circumstances not the circumstances applicable in 1991. So these propositions that the ASU thought there might be an issue about whether or not the first licence carrier still existed quickly abandoned once they had got some legal advice, and putting an argument before the Commission just confirms that there was no substance in them at any time, and with respect to Mr Dennard, and indeed Mr Slape, points that their reasoning is completely untenable in advancing that they though there was some change.

PN2092

Annexure P is another document dated 8 December complaining of misrepresentations, as indeed is annexure R. Just before annexure R, your Honour, is annexure Q which is the document distributed by the ASU in which it is suggested on the third page that Optus had made a concession that the ASU could represent employees. This is at the bottom right hand corner of the third page.

PN2093

THE SENIOR DEPUTY PRESIDENT: Yes, I recall we went through this didn't we?

PN2094

MR KITE: I think we dealt with it as an annexure to Mr Dennard's statement earlier. You will recall Mr Dennard's explanation that the net effect of what Optus did was to concede the ASU coverage and rights to represent when clearly it is Optus 11, the letter from Optus to the ASU, made clear that it was allowing Mr Smith to represent in a personal capacity to act as a support person. It was not conceding the ASU any coverage rights. There was never any correction, never any acknowledge of that position. Mr Dennard's explanations were, in our respectful submission, completely unbelievable on that approach. Annexure S is the decision of the Vice President. Can I just take your Honour to that briefly?

PN2095

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2096

MR KITE: His Honour observes that there were two unions seeking to represent the interests of Optus employees, the ASU and the CEPU, and he refers to two issues, one, the application by the ASU to intervene in the proceedings, and the application to be bound. At paragraph 7 he notes that essentially those two things turn on the same point that is whether the ASU is entitled to represent the industrial interests of Optus employees. He deals with the technical submission firstly through to paragraph 14, and then at paragraph 15 turns to the question of entitled to represent he sets out the rules, and can I just draw to your Honour's attention the words involved notwithstanding anything to the contrary contained in this rule.

PN2097

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2098

MR KITE: His Honour holds, as his Honour will see, that the words "this rule" means the whole of rule 5 as the ASU was seeking to rely on their technical rule in servicing, which is his Honour sets out on the next page, page 5, servicing, repairing, maintaining, structurally altering or assembling business equipment et cetera on the basis that the help desk people were repairing computers by the diagnostic services and so on, doing it remotely. You might recall the evidence of Mr Nucifora that the ASU has moved on from that argument; it doesn't press that any longer, but reinforces the potential for demarcation issues about what is technical and what is not.

PN2099

At paragraph 17, his Honour first notes there are few facts in dispute, and notes the concessions by the ASU. Then to the history of the rule exclusion the argument by the ASU as set out in paragraph 19 that the exclusion ought not to be construed according to its ordinary terms, but rather should be construed in the light of changed circumstances, and indicates that essentially that is that Optus is no longer providing just telephone services. At paragraph 20 it noted that they would otherwise rely on ..... clerical rule to cover people in call centres. His Honour sets out the proper approach to interpretation.

PN2100

Then at paragraph 24, on the second last page, he notes that although extrinsic material might be referred to for the purpose of removing ambiguity, he accepts:

PN2101

that when construing union rules it may, in particular circumstances, be permissible for a party to demonstrate ambiguity by reference to historical circumstances.

PN2102

His Honour then says:

PN2103

In my opinion, there is no ambiguity presented by the natural reading of Rule 5, b, part II of the ASU rules. The meaning...(reads)... employed "in or in connection with the telecommunications industry".

PN2104

In paragraph 26, in the last sentence, he notes that the history of the rule exclusion supports his interpretation rather than contradicting it and finds that the ASU is not entitled to represent the industrial interests of these employees. He makes the suggestion in the last sentence of paragraph 28 that the more appropriate course of action is to seek to vary the rules if they want coverage. So concessions about the possibilities giving promptly and to the argument about change given short shrift by his Honour because it is clear that what Optus does and did, and has always done, is operating in connection with the telecommunications industry.

PN2105

We have given your Honour a reference to the decision of Vice President MacIntyre in re Construction, Forestry, Mining and Energy Union 107 Industrial Courts. Mr Nucifora handed that up and referred to paragraph 66 in which his Honour weighed in the balance for various considerations. Can I just refer your Honour to a couple of other paragraphs. First at page 427 under the heading conclusions.

PN2106

THE SENIOR DEPUTY PRESIDENT: Yes. Which paragraph are they?

PN2107

MR KITE: Paragraph 47.

PN2108

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2109

MR KITE: His Honour sets out the facts, the third of those I draw to your Honour's attention.

PN2110

At the present time the AWU at Comalco Weipa has virtually no members and has not recently attempted to enrol members. Accordingly, at Comalco Weipa, it is virtually non-existent;

PN2111

At paragraph 55, his Honour refers to the discretionary considerations raised by the objectors and the first of those is that enrolled persons in the CFMEU is not entitled to enrol, the second that it defied orders and the third that the potential for demarcation disputes. At paragraph 58, his Honour says that:

PN2112

The CFMEU's action in enrolling beyond eligibility at Comalco Weipa is a serious matter which tells against it in the determination of its present application.

PN2113

In paragraph 59, the second discretionary issue, that is the defiance of orders, his Honour finds is also a serious matter, notwithstanding, that those orders were not directly related to the present matter. His Honour, then at paragraph 66, weighs the two discretionary points against the evidence to the effect that the AWU is virtually non-existent, and as Mr Nucifora says ultimately comes down on the side of the rights of the employees in those circumstances to choose. The difference here is that the CEPU cannot be said to be non-existent.

PN2114

Your Honour has all the references to the CEPUs activity which we have set out under the headings more effectively represent, and there is also Optus 5 which is the correspondence from the CEPU to Optus over a number of years, 2001, 2002, 2003 seeking access to Optus premises for the purposes of representing employees. There activity was they were there, they were active, and it was current. Nor is there any evidence of a rejection of that union in favour of the ASU. We have given a reference there to Mr Cooper's evidence and Mr Slape who imagined that some CEPU members may have resigned to joint the ASU.

PN2115

It is our respectful submission that the Commission should not condone this conduct by consenting to the alteration, and more so because this unlawful recruitment drive was also conducted on a misleading basis. We make the same point about the defiance of the Commission's 118A orders. In paragraph 7.5.4 we deal with that recruitment drive, and the various bulletins and statements made by the ASU to attempt to recruit these employees. I won't repeat them your Honour, I think that will be fresh in everyone's memory in the cross-examination of Mr Dennard.

PN2116

THE SENIOR DEPUTY PRESIDENT: Yes.

PN2117

MR KITE: We have given references there fairly comprehensively to support those points. Could I just make one correction on the bottom of page 16, or note one, and that is the last line should read:

PN2118

Or otherwise reflect an effort to justify an active misrepresentation.

PN2119

THE SENIOR DEPUTY PRESIDENT: Yes, it has been corrected actually.

PN2120

MR KITE: Thank you, your Honour. At the end of the submission we make on that point on page 17, we note that Mr Nucifora sought to excuse the misrepresentations as mere spin or licence. Might we say this, that even if there is competition between unions and marketing strategies will be employed just like corporations or other businesses are held to account if they misrepresent positions they make misleading or deceptive statements, so should unions. Competition doesn't mean open slather, it means responsible competition. Whereas corporations might be called before the ACCC or before the Federal Court to account for their misleading conduct, unions can rightly be held in account by this Commission for their misleading conduct. Might we say that the spin put on matters well exceeds any legitimate marketing strategy.

PN2121

In paragraph 8 we deal with an alternative proposition to that, and that is if the Commission is mindful to consent to an alteration of the rules, notwithstanding, there are no other submissions, then we submit that the proposed wording is too broad and will not deal adequately with the area of agreement between the CEPU and the ASU, nor is it a minimalist approach.

PN2122

We would submit that if the Commissioner were minded to grant some variation then it should be limited to inserting in the exclusion in paragraph (iii), that is notwithstanding anything else contained elsewhere in this rule, three employees other than - perhaps it is easier if I refer to ASU16, your Honour, rule 5, part B, part II, which is on page 7 of the exhibit. (iii) could be varied by inserting after the word "employed", "other than persons employed in any clerical capacity in call centres in South Australia," that would be the minimalist approach, and would identify the particular agreement between the CEPU and the ASU rather than the broader work which is employees employed in call centres, because it is not all of those employees. The unions agreed between them that the ASU will not cover technical employees. Unless there are any other questions.

PN2123

THE SENIOR DEPUTY PRESIDENT: Just one thing, Mr Kite. Section 158(7) of the schedule 1B which relates to the Commission refusing to consent to an alteration if it satisfied it would affect an order made by the Commission under 133, how do you say that section operates? You probably dealt with it to some extent when you dealt with the Full Bench decision in CPSU.

PN2124

MR KITE: Yes. It is a difficult and the Full Bench goes to some length to try and explain it because of the potential scope of the section. Our primary submission is that a variation under section 158 of the eligibility rules in this case will not change the affect of the 118A order, but will change the affect of the ancillary orders made under 118A, that is, the orders varying the rules of the ASU, or the FCU as it was in 1992. That is the legal position. The other potential position is that there may be a practical change in the effect of the 118A order by introducing confusion amongst employees in that the ASUs rule will say that it can cover these employees, but the 118A order will say that it can't, so the legal effect hasn't changed but the practical effect is to introduce confusion in the pattern of industrial coverage.

PN2125

THE SENIOR DEPUTY PRESIDENT: But do you accept that the provision itself implicit within the provision itself is the right in the Commission to consent notwithstanding that all those circumstances prevail?

PN2126

MR KITE: It is a discretionary matter certainly.

PN2127

THE SENIOR DEPUTY PRESIDENT: Well, what do you say directs the discretion?

PN2128

MR KITE: Whether or not the deleterious effects are going to outweigh the positive effects, and the deleterious effects in this case will be that an order will remain by the Commission saying this union does not have the right to represent these people.

PN2129

THE SENIOR DEPUTY PRESIDENT: I understand. I thought that was what you were saying before, I just wanted to clarify that in my own mind.

PN2130

MR KITE: If we go back to the essential proposition in the Full Bench decision, the making of the order does not override the 118A order so it remains in effect, and so we have got a potential conflict, but the 118A order will prevail over the rule.

PN2131

THE SENIOR DEPUTY PRESIDENT: Thanks very much, Mr Kite. Mr Nucifora, did you want to say anything in reply?

PN2132

MR NUCIFORA: Yes, your Honour. Your Honour, in relation to a number of issues raised by Mr Kite. They say, and I refer you here to paragraph 6.1 - - -

PN2133

THE SENIOR DEPUTY PRESIDENT: Of the outline of submissions?

PN2134

MR NUCIFORA: Sorry, of the outline of submissions of Mr Kite that the order was made ultimately by consent. We would say, your Honour, that you could not say that there was consent to the same extent there was in other demarcation orders that had been heard before the Commission, particularly in Higher Education, and this was - - -

PN2135

THE SENIOR DEPUTY PRESIDENT: Was there an agreement between the ASU?

PN2136

MR NUCIFORA: No. In effect, as Mr Kite has put it, and this comes up through the witness evidence, the FCU at the time was opposed to the order right up until the very last moment, albeit, at that last stage opposed to the possible effects of the order, and didn't appear in the end, and didn't make further submissions.

PN2137

THE SENIOR DEPUTY PRESIDENT: Well, Mr Kite said that you put no material and the FCU put no material as I understood it.

PN2138

MR NUCIFORA: No. That is what happened, and we would put that in a different category to an agreement reached as in Higher Education there was clearly an agreement reached between all the union parties.

PN2139

THE SENIOR DEPUTY PRESIDENT: But you didn't participate in the objections?

PN2140

MR NUCIFORA: No, your Honour. What I am saying is, it was an act of consent. There was at the end by not appearing certainly my friend has given it a status higher then we would say that it was. Certainly, I wouldn't put it in the same category as the agreements reached in Higher Education where there was clear agreement reached in fact there were demarcation agreements reached with all the unions involved before the demarcation order was made, so there was certainly a consent between the parties. So we are saying there were no agreements there were in fact, if you like, a non appearance and you would have to say that we were dragged kicking screaming in relation to that particular demarcation order.

PN2141

Your Honour, Mr Kite took you to 6.3.3 "the significant number appears to be no more than 17". I think he was referring to seven members and then of course the argument goes that we shouldn't have had those seven members apart from those that were pre-existing members and had been members before they worked at Optus. You can see the dilemma the ASU had in that time, of course, and that is that we were seeking to represent people who were wanting the ASU to represent them and I put it as high as at least on the evidentiary material as 17, because there were at least 17 people who had an active interest in the ACU representing them.

PN2142

Now, we do have those figures, they are not large numbers, but in the evidence before you there was no other material or numbers of member in fact the CEPU had. We didn't seek to obtain that particularly in the way these proceedings panned out. We actually don't believe it is a question of numbers, it is a question of key issues whether there are employees who seek to exercise their right to choose which union they should belong to. Now, at one stage we were putting it as high as 25, we don't say that in the material before you, we say that there are at least 17 Optus employees and of course you had that evidentiary material before you.

PN2143

Now, of course, in 6.3.3 it is mentioned five years of recruiting. There really was only in terms of recruiting that period of time in 2003 where we did accept members and we believed on the advice that we had been given at the time that in fact there was an arguable case and of course, you know, through the course of these proceedings there has been this debate about whether that was misrepresentation, whether that was in fact in breach of the demarcation order, and whether people were actually mislead. I don't believe there is any evidence before you that shows that in fact employees were in any way affected by what was claimed to be a misrepresentation. We say, your Honour, what there is there is evidence before you and people wishing to have the ASU - the key issue is the ASU represent them in some form. We say, your Honour, in terms of - - -

PN2144

THE SENIOR DEPUTY PRESIDENT: They were affected weren't they, I mean if you tell them you can represent them and then they seek your assistance only to find that you can represent them, they have suffered some detriment, haven't they?

PN2145

MR NUCIFORA: Well, there is no evidence before you that there is - has been any detriment. Your Honour, potentially there would have been the person who had the workers' compensation claim pursued, we sought to arrange for a lawyer to represent that person. When Mr Smith represented an employee as an individual and there was correspondence that went to that particular meeting, there was no evidence that in fact the employee had been disadvantaged. Now, if it is as high as Mr Kite - sorry, if the misrepresentation or if you like the conduct of the ASU through 2003 leading up to the proceedings before Vice President Lawler was as high as he claims, then we wouldn't have got past square one with His Honour.

PN2146

His Honour indeed allowed the ASU to appear to put its argument in relation to not only clerical, of course, we were then - there was this question of the technical employees covered within our rules, which had never arisen before that day, but certainly we - it arose then. So we don't see in his decision any reference to the demarcation order. His Honour didn't believe that that was a question and no doubt Optus has been claiming that all the way through all year leading up to that hearing, and we could have been struck out on the first day that we appeared, but in fact he didn't refer to that, and his Honour says, and we said this right from the beginning in our opening submissions in paragraph 28, the more appropriate course of action for the ASU, and one I believe the ASU has already embarked upon, is to make an application to the Commission from an alteration of the eligibility rules of the ASU.

PN2147

There is no mention of the demarcation rule and your Honour that is from the ASUs point of view, it wasn't just as a result of the submissions being made by the ASU, there was, of course, the CPU and Optus were involved, they were represented there, they could have put the argument they had been putting all along that year, and in a sense and right up to today, that the ASU was in fact was not - the conduct of the ASU was not something that the Commission would ever accept. Indeed, we see in its decision no reference to that conduct. All we see is in fact a reinforcement from his Honour that the process that we did follow was about as good as we could get in terms of trying to represent employees that is at that - just prior to the decision about the time he was hearing this matter, we had lodged the application.

PN2148

Now, we knew back then because of our experience in 204 and schedule 1B matters that this was no going to be done overnight, that it would take a year or two, and that is just the way those applications proceed and there is an upside to that, because it does allow the unions to sort out their differences. Sometimes it takes a long time to sort out those differences, but - - -

PN2149

THE SENIOR DEPUTY PRESIDENT: So I have found out from experience.

PN2150

MR NUCIFORA: Yes, your Honour, and some of have gone longer than two years, but from my experience, but had we not done that, had we proceeded with an application to vary the demarcation order back to front if you like, or the right way round had we gone back in time in the way it used to be under the old Act, then we don't believe we would have been able to get the sort of cooperation or we wouldn't have had the opportunity to resolve our differences with the CPU as we did here. We are not to know that, but your Honour what I am saying is that we always found that that decision of Vice President Lawler and the circumstances surrounding that, leading up to that, really confirmed the position that we had taken, an arguable one that there was a certain conduct that we could engage in and it ought to be tested before Vice President Lawler.

PN2151

He indicated that certainly if we were under any misunderstanding about the rules and how they read and that would clarify, and thereafter we sought not to recruit employees, of course, to our detriment because we now only have seven members apart from one that signed up after that date, and we ensured we stuck by what was then a determination of a senior member of the Commission. I think at that time we also had the concern where Optus leading up to - through all the period of time that we have had involvement, of course, Optus has actively discouraged employees to have anything to do with the ASU, and that would certainly mitigate against the numbers of members that - or numbers of employees we say have an active interest.

PN2152

Nonetheless, the weighting that Mr Kite has mentioned to you because of what he considers a misleading recruitment drive, what has got to be taken into account is the weighting of having a very large employer actively, which we know through all the evidentiary material, of actively opposing the ASU and actively discouraging employees having anything to do with the ASU. Also the fact that the ASU took a conscious decision after that decision not to recruit as members people that his Honour found that we couldn't cover.

PN2153

In 7.11 we would mention the CEPU is clearly recognised as the telecommunications industry union. The ASU has always claimed that it is a clerical admin call centre union as well of course those other areas, local government and social and community welfare. We would have always acknowledged that it is not only the CEPU but the CPSU are the traditional telecommunications industry unions and we acknowledge their role in the industry, and of course in more recent times they have acknowledged that we are, as I mentioned before, the clerical admin call centre union for the private sector.

PN2154

The fact that we refer on one occasion to our union being a telco union or a national telco union is not one that we otherwise promoted nationally and we wouldn't seek to do that in the future, that has never been one that we have substantiated as a true position of the ASUs coverage. It is really one where we say that whole area of telecommunications is one that is in two other areas such as pay television, such as media.

PN2155

I mentioned before that in 7.2 there is a reference that the CEPU has established a representative network. Well, there is really only one formal delegate. Mr Cooper, and I think you were looking for what he said in the witness box, but he has indicated that there is not a high level of membership throughout Optus, but indeed he doesn't say, and the CEPU are not saying now that call centre employees working for Optus in South Australia can more conveniently belong or be better represented. He might at best be saying that the CEPU can represent call centre employees as well as the ASU, but he is not saying - there is a higher test, of course, now with the new provisions of the Act, and I don't believe that position has been established, and we certainly don't know what the nature of the membership is of the CEPU in South Australia.

PN2156

That is not in any way a formal criticism of the CEPU. The CEPU has tried just as hard as the ASU in these very difficult areas to organise. It really is an understanding between the ASU and CEPU at least in relation to South Australia that both unions have done their best to organise employees and while we have obviously claimed that we can better represent and these call centre employees can more conveniently belong, that is a proposition that we put right across the private sector. There is a key question in all this. There is a key question in all this your Honour, Mr Kite took you to section 158(7) and an explanation of that. Our primary submission in that, and you asked the question, and your Honour is implicit in that is that it is discretionary, an important discretion.

PN2157

THE SENIOR DEPUTY PRESIDENT: You made that point.

PN2158

MR NUCIFORA: I did make that point, and just to reconfirm that point, we don't believe that you can as a result of the Full Bench decision in the NTEU matter that you can override the effect of a section 118A order, but it is cumulative and there hasn't been much said about B which gets back to that key question again about whether there is any serious risk of a demarcation dispute.

PN2159

THE SENIOR DEPUTY PRESIDENT: Mr Kite says, well, given the fact of the order, you can't effectively represent the employees in any event if the rule is altered because you have the order standing against you.

PN2160

MR NUCIFORA: Well, he says that, but it is discretionary. It says the Commission may also refuse to consent to an alteration of the rules if it is satisfied that it will effect the change of any order, and considers it such a change.

PN2161

THE SENIOR DEPUTY PRESIDENT: Yes, but as I understood Mr Kite's submission, it doesn't change the effect of the order. If I make the rule - - -

PN2162

MR NUCIFORA: No, we are not seeking to change the effect of the order, and therefore there is an inconsistency certainly at law not in terms of its practical application, and that is why we would seek to vary the order should you find in favour of the union in terms of the merits of this case, because we agree that you can't override or you could part override that particular order.

PN2163

THE SENIOR DEPUTY PRESIDENT: Yes, but the application to vary the order isn't before me. Well, it is, but not in these proceedings.

PN2164

MR NUCIFORA: No, it isn't, your Honour, and we believe that it firstly is a discretionary matter, it is an important discretion, and we ought to deal with that matter, but as indicated by Vice President Lawler, we believe this to be the correct process to follow to deal with the rules of the union. Had we not done that, had we sought to vary the demarcation order, we wouldn't have got the sort of discussions going with the other union, particularly the CEPU.

PN2165

THE SENIOR DEPUTY PRESIDENT: It doesn't appear though when Vice President Lawler made the suggestion that the ASU should alter its rules, that his Honour had turned his mind to 158(7).

PN2166

MR NUCIFORA: It hadn't been raised by either parties in particular Optus, and at that stage, the CEPU, who were opposed to us having any coverage in Optus. It gets back to the difficult position the ASU has in trying to represent any number of employees. The CFMEU matter referred to the decision of Vice President MacIntyre and he does mention this point that whatever the numbers are, how few or however many, is this key question of weighing up the rights of employees to choose which union they should belong to.

PN2167

But, we say your Honour that there was nothing in the decision of Vice President Lawler that alerted our union to do something other than the process that we follow, and we believe at the end of the day it is discretionary, an important discretion, and that in any case we have proposed a way of dealing with the inconsistency. Certainly the legal affect of having an extant demark order that would be inconsistent with the proposed rule change that we are putting to you.

PN2168

Your Honour, in terms of the serious risk of demarcation, of course, Mr Kite referred to the diversion of resources that Mr Draper had taken you to, once again, we look at the CFMEU case, and while the conduct of the CFMEU signing of employees was a serious matter, that his Honour weighed that up in accordance - the right of employees to choose which union they should belong to pursuant to section 3F of the Act. The difference my friend is saying is the AWU had no members and were non-existent in the workplace. Now, we haven't claim that about the CEPU in South Australia, but likewise there is in evidence before you about the numbers of members or how widespread the CEPU is in South Australia.

PN2169

Not outside South Australia, we don't make any comment about membership the CEPU has in other states. So in weighing that up, we say and of course Vice President MacIntyre was on the Bench of the CFMEU matter. They refer to conduct there as well, your Honour, the conduct of the CFMEU, and there is a list of what we would consider very aggressive conduct of the CFMEU in that industry in signing up employees, and there was employee witness evidence and of course there was not only employee witness evidence there was the AWU raising those concerns as well. We don't have that here we have the employer saying there is the diversion of resources. An employer would say any time how can we deal with the unions, they are a diversion of resources, and we say, your Honour, the serious risk of demarcation at its strongest in this industry, and involving our union would be a paper one.

PN2170

His Honour Vice President MacIntyre makes that distinction between paper and real disputes. We say that at the end of the day he has weighed it up, freedom of choice of however many number of employees clearly made by employees in wanting to joint the CFMEU outweighs all these other considerations including conduct. Your Honour, we refute of course 7.5.1 that the ASU has enrolled person at Optus whom it was not entitled to enrol. In terms of that period of 2003, of course, there is the pre-existing members, but the new members that we might have picked up in that time, there was one that where we believe there was an arguable case, and once - - -

PN2171

THE SENIOR DEPUTY PRESIDENT: Yes, but the reality is whether or not there is an arguable case, you either were or you weren't entitled to enrol them, legally.

PN2172

MR NUCIFORA: At the time that we signed them up we believe that there was an arguable case and once that - - -

PN2173

THE SENIOR DEPUTY PRESIDENT: You believe that, but the reality was, as a matter of law, you couldn't.

PN2174

MR NUCIFORA: Yes. That was determined quite definitely by Vice President Lawler, and we didn't proceed with that any longer. But indeed the CFMEU conduct, and we put that at a higher level, would fall into one and it still didn't persuade Vice President MacIntyre to find against them.

PN2175

THE SENIOR DEPUTY PRESIDENT: Yes, I understand.

PN2176

MR NUCIFORA: Once again the CFMEU clearly falls into that category of two, and the ASU has sought to knowingly defy orders of the Commission where there was an arguable case. As I say, we would put it in the same category as one. I mentioned before, we don't believe that there is any evidence before you that goes to there being any either harm to the employee, or for that matter, Optus would claim that there is harm to their business, but that hasn't been shown in terms of any demarcation disputes, but we say, your Honour, we would refute the claim that we actively misled employees. I think there is no doubt from the material that is before you that employees realise that there is some question mark about our coverage, and of course that question mark was answered to a large extent by Vice President Lawler's decision.

PN2177

Your Honour, in 7.5.2(3) there is a reference to an unlawful recruitment drive in respect of office employees during the period of 2003 to 2005. Well, really it was 2003. There was one person that was employed after the decision of Vice President Lawler, and we would refute that that was an unlawful recruitment drive. We say, your Honour, that in terms of I think Mr Kite referred to some claims on Mr Dennard in relation to the meeting between Mr Smith and management, and in re-examination, Mr Dennard was not aware of the letter. He was aware of a meeting that occurred and Mr Dennard, of course, was arguing that Mr Smith could represent individual employees as an individual.

PN2178

Now, your Honour, in terms of the alternative that Mr Kite has put to you, we say, your Honour, that we have tried a minimalist approach to the change of the rules, and in the final agreement with the CPU there was a little more that was added to the amended rule, but really the history of this goes back to - it all really arose under our clerical rule coverage. Now, I mentioned and Mr Kite has acknowledged that we have moved on since then with our memorandum of understanding reached with the CEPU that we don't seek to pursue the area of our rules that refers to technical employees which normally refers to technical employees who wouldn't normally be considered in the telecommunications industry.

PN2179

The predecessor union, the Technical Services Guild, continues that area of coverage, but we would continue to cover photocopying technicians, and there is no evidence before you on this, but clearly it is not an area that we say arises as a result of this amendment. We are seeking to amend an exclusion that went in strictly in relation to our clerical rule coverage, and we don't believe that making it any more complex with the alternative submission by referring to technical work assist the parties, although the memorandum of understanding is quite clear between the ASU and the CEPU that we wouldn't seek to recruit technical employees.

PN2180

Your Honour, in terms of any dispute between the two unions about who was technical and who was clerical, there is a procedure in the MOA that we have used on many occasions in rules matters before the Commission, and that procedure doesn't refer to industrial action because it rarely ever occurred, but certainly with our union involved, and other unions that have been parties to the disputes handling procedure refers to conduct, and that refers to all conduct, and not proceeding with any further conduct until the matter is determined by private arbitration. So we say any dispute between the unions ought to be resolved by following that procedure because we are living in a world with a new legislation, and certainly in the future there will be increasing opportunities for unions to compete, and in that environment - - -

PN2181

THE SENIOR DEPUTY PRESIDENT: I don't know about that, Mr Nucifora.

PN2182

MR NUCIFORA: To compete with not just existing unions, but may be other new enterprise unions that once referred to as bosses unions, but, your Honour, we say in that environment that we ought cooperate, there ought be a discipline between the parties to the pattern that I referred to in the call centre industry which carries over to the contract call centre industry to the telecommunication related areas such as pay television and, of course, now more recently here at Optus as we would propose, allows the unions to follow a process so if anything there may be positive competition, but not negative competition where the unions are using resources to undermine each other in trying to represent the same areas of coverage.

PN2183

To the extent that that has worked, and we have had a few that have gone back a couple of years that were in the attachments that I refer you to, your Honour. At this stage, none of them have actually gone to the ACTU, so they have actually worked to the extent when I mentioned before the biggest area of competition in this area has been between the ASU and CPSU, and those issues have been resolved as a result of signing off on those sort of demarcation agreements because we all know if there is a demarcation dispute, well, it will not only end up before the ACTU, but could end up in a private arbitration. So at the end of the day it allows the unions to follow a more organising strategy which means that some unions are in a better position then other unions, have the resources in a particular area to organise in these overlapping areas of coverage.

PN2184

Your Honour - and I will just finish on this point, you have mentioned in the Tennex decision, and I opened with this, that it makes industrial commonsense for that to occur, and that is a practical observation I guess, your Honour, but it is one that from the union's point of view is one that is working elsewhere in the call centre related area of coverage. If you Honour pleases.

PN2185

MR KITE: If I can just clarify one matter. Vice President Lawler does refer to the 118A order in paragraph 18 of his decision, and at paragraph 26 when he refers to the history of the rule exclusion he is referring back to that paragraph.

PN2186

THE SENIOR DEPUTY PRESIDENT: Yes. All right. I reserve my decision. I thank the representatives of the parties for their very comprehensive and helpful submissions. I don't know how long it may take, but I appreciate that it has been around for a long time, and I will do my best to get it out as quickly as possible. Thank you, the matter is adjourned.

<ADJOURNED INDEFINITELY [3.39PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #OPTUS 17 EXTRACT FROM THE PROPOSED AGREEMENT PN1567
EXHIBIT #OPTUS 18 ATTACHMENTS CC5 TO CC9, CC11, CC12, CC16 AND CC17 FROM THE STATEMENT OF
COLIN COOPER PN1573