C2005/1585, Transcript of Proceedings [2005] AIRCTrans 1326 (14 June 2005)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 11753-1

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

C2005/1585

APPLICATION BY HEALTH SERVICES UNION OF AUSTRALIA
s.113 - Application to vary an Award
(C2005/1585)

ADELAIDE

10.05AM, WEDNESDAY, 01 JUNE 2005

PN1

MR J NAVAS: I appear on behalf of the Health Services Union.

PN2

MS E VAN DER LINDEN: I appear on behalf of Business SA and we are also instructed to act on behalf of Gribbles Pathology.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, this application, Mr Navas, was originally sought to be addressed by way of what I call the e-hearing process. The e-hearing process was originally applied to agreement certifications but there are now numerous instances of where I have successfully managed to apply it to award variations, particularly when those variations reflect a safety net adjustment. I am going to have to think twice about trying that again in relation to your future applications because its application is dependent upon the applicant union or party doing its homework properly and doing its arithmetic properly. In this instance, I have not been able to complete the process by way of that e-hearing process.

PN4

I would have to say this is the first such instance of this sort of problem so I can only earnestly suggest to you that future applications for safety net adjustments be predicated on some very careful homework to ensure that you don't put yourself to added cost and difficulty, that the employer is not inconvenienced and indeed that the whole process of achieving these safety net adjustments, which is designed to be relatively simple is not complicated. An email was sent to the parties that reflected, on 18 May, it reflected the draft order provided by the union and my inability to properly reconcile that draft order with the performance based increment which was included in the current award.

PN5

I don't know what conclusion the parties have collectively reached in that regard, nor indeed how that conclusion is going to be explained to me. I am working from the basis that given that this application was one of three and that I have expressed very clearly to the parties that the Commission's general practice is to award prospective safety net adjustments, that a prospective safety net adjustment is agreed between the parties. But I do require some advice from you about that performance based increment and the extent to which that should be incorporated or not incorporated in the order reflecting this application. What is the answer, Mr Navas?

PN6

MR NAVAS: Commissioner, when the Gribbles Pathology Award was simplified, that performance based increment was put in there but on discussions with the employers we have agreed, and since the performance increment is already absorbed into the new rates, then all future increments or all future applications we did not require any longer the performance basis. That is already absorbed in the new rates which are now the old rates of 2004, 2003, sorry. Therefore when the application was made it reflects the old rates and the safety net adjustments plus the new rates because those performance based increments are already absorbed into the new rate as the he chose in the simplified award.

PN7

THE SENIOR DEPUTY PRESIDENT: But Mr Navas, if I am understanding you correctly, Commissioner Hingley's simplification of the award aligned the rates under the heading of adjusted minimum rate in accordance with the minimum rate adjustment process. That is, I don't know what status these performance based increments have.

PN8

MR NAVAS: Right. That is why when those got added with the performance then we would finish with a new rate which is the rate that applies now to the award.

PN9

THE SENIOR DEPUTY PRESIDENT: Yes. But that is the question that I am asking.

PN10

MR NAVAS: Yes.

PN11

THE SENIOR DEPUTY PRESIDENT: That the minimum rate adjustment process which reflects the Commission's established principles in that regard requires the Commission to be satisfied that, first of all, it has established a key classification and a relativity between that key classification and the tradesperson's classification in the Metal Industry Award. Having gone through that process, then the minimum rate adjustment process requires the Commission to be satisfied that relativities between that key classification and other classifications in the award have been adjusted to reflect an established relativity within that particular award. Now, in this case, I have got an award that has a minimum adjusted rate.

PN12

I am working from the premise that that minimum adjusted rate reflected Commissioner Hingley's assessment or agreement as to a particular relativity with a metal tradesperson and that further, it reflected the establishment of other award wage relativities which reflected the pre-existing relativities within this particular award. So that the key set of wage rates which I understand that flowed from the simplification process, are those that are described as the minimum adjusted rates. I don't know what this performance based increment is, I don't know the extent to which everybody receives it but most particularly, what I understand you to be saying to me is that the current rate is the rate to which future national wage or safety net adjustments should be applied.

PN13

On the face of it that appears to be quite inconsistent with the Commission's normal approach in that what the Commission has done on numerous occasions is establish a minimum rate and identify that as the basis for future safety net adjustments in the award. The Commission will then very commonly look at the existing award and if the rates of pay in that existing award which may have had safety net adjustments applied to it, exceed the minimum rate then that amount is identified and is progressively whittle away, if I can say that, by future safety net adjustments.

PN14

I don't know whether the performance based increment that is identified here is one of those amounts which the Commission intended to be progressively reduced as the minimum adjusted rate has increased. But I do know that there is absolutely nothing before me that establishes the basis upon which I can rely on the current rate, which is the minimum adjusted rate, plus this performance based increment so that future safety net adjustments are applied to that without undermining the integrity of that minimum rate adjustment process. It is not going to be enough for you to simply say to me that the parties have agreed to this because I am not in the business of undermining the principles established by the Commission through that minimum rate adjustment process. So you are going to need to provide me with something more than what you have just done.

PN15

MR NAVAS: Thank you, Commissioner. I would need to come back to you on that because I did time with these negotiations with the employer who was understood that the new rates will be the rates that will apply and that this process will be one for the safety nets will be applied to those new rates not that they will be whittled away.

PN16

THE SENIOR DEPUTY PRESIDENT: Yes. But do you understand the question that I am asking you, Mr Navas?

PN17

MR NAVAS: Yes, I understand the question. That is why at the end of the clause of the rates of pay there is a clause ..... the incremental progression and how will apply. That is the reason why that was introduced as part of that process. That is clause 17.2.

PN18

THE SENIOR DEPUTY PRESIDENT: Yes. Clause 17.2 talks about incremental progression.

PN19

MR NAVAS: Yes.

PN20

THE SENIOR DEPUTY PRESIDENT: What I don't see is any link between clause 17.2 and the concept of performance based increments. There may be a link but I am saying there is nothing before me that establishes that.

PN21

MR NAVAS: Commissioner, unfortunately one of the things that happened is that, as you rightly said and there were a lot of mistakes made in the agreement. Most of the time all these processes are down from Victoria from our national office. In fact, I am talking earlier - - -

PN22

THE SENIOR DEPUTY PRESIDENT: You can buy them a new calculator, Mr Navas.

PN23

MR NAVAS: Yes. I know. One of the things they do is that they constantly keep using processes that are used in Victoria not in South Australia. Talking to Estha earlier on actually we agreed that after this is done we were totally will be taking control of how the applications are made and the process - - -

PN24

THE SENIOR DEPUTY PRESIDENT: The process that I have outlined to you, that is the principles underpinning the minimum rate adjustment process is a national process.

PN25

MR NAVAS: Yes.

PN26

THE SENIOR DEPUTY PRESIDENT: It is not a South Australian speciality.

PN27

MR NAVAS: Yes.

PN28

THE SENIOR DEPUTY PRESIDENT: All right. Well, within what timeframe might I expect you to come back to me, Mr Navas?

PN29

MR NAVAS: Within a week?

PN30

THE SENIOR DEPUTY PRESIDENT: All right. Well, look, if the information that is provided to me is established as being provided on an agreed basis and if it addresses the issues that I have raised with you then I will work from that premise and make an order accordingly. That order would be dated from the date upon which I receive that material. If however, that information does not address the issues that I have raised you can expect to be asked to come back here. I won't be engaging in a further email exchange process.

PN31

MR NAVAS: Yes, Commissioner.

PN32

THE SENIOR DEPUTY PRESIDENT: All right?

PN33

MR NAVAS: Thank you.

PN34

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, Ms Van der Linden, are you happy with that process?

PN35

MS VAN DER LINDEN: Yes, I am, sir.

PN36

THE SENIOR DEPUTY PRESIDENT: All right. Have you got any questions about the observations I have made about the minimum rate setting process?

PN37

MS VAN DER LINDEN: No, sir. I have had a chance to look through some of the files of Business SA through transcripts and haven't come up with anything conclusive as we would suggest. I would maybe suggest that we look through some of the history files here at the Registry to try and understand what has happened in the past.

PN38

THE SENIOR DEPUTY PRESIDENT: All right. If the parties need longer than that week I am happy to extend that timeframe, what you would need to do is to contact my associate in that regard.

PN39

MS VAN DER LINDEN: Certainly.

PN40

THE SENIOR DEPUTY PRESIDENT: You see, the application of the normal approach would tend to indicate that the safety net adjustments are to be applied to that minimum adjusted rate but the parties may have information that I don't have that dictates a different process.

PN41

MS VAN DER LINDEN: Yes. Looking at the current award, the 2003 award, I notice that the 2002 safety net adjustment has been added onto the current rate. It hasn't actually been absorbed into the performance based increments which is, I guess - we have gone from that basis as well so our understanding was that the current rate, the new rate within the current award, if that makes sense, then becomes the current rate and the safety net is added onto that as the 2002 safety net wasn't actually absorbed into the performance based increment. That was our theory on why, or one of the theories will be a theory which isn't based on any research which we have been able to develop.

PN42

THE SENIOR DEPUTY PRESIDENT: All right. Well, I will leave that issue with you.

PN43

MS VAN DER LINDEN: Not a problem. Thanks.

PN44

THE SENIOR DEPUTY PRESIDENT: Thank you. I will adjourn the matter on that basis.

<ADJOURNED INDEFINITELY [10.21AM]