C2005/3275, Transcript of Proceedings [2005] AIRCTrans 1362 (22 June 2005)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996

SENIOR DEPUTY PRESIDENT CARTWRIGHT

C2005/3275

MM KEMBLA PRODUCTS (A DIVISION OF METAL MANUFACTURES LIMITED)
AND
AUSTRALIAN WORKERS' UNION, THE
s.170LW - Application for settlement of dispute
(C2005/3275)

SYDNEY

2.09PM, WEDNESDAY, 08 JUNE 2005

PN1

MR E SZCZEPANOWSKI: I appear for Metal Manufacturers together with MR T MOSS, operations manager and MR B POPOVSKI, the KCR area manager.

PN2

MR D HANCOCK: I appear for the Australian Workers' Union, Port Kembla branch, and with me is MR P MURPHY and MR S ZAKACS.

PN3

THE SENIOR DEPUTY PRESIDENT: Thank you. I haven't seen you for some time, Mr Hancock.

PN4

MR HANCOCK: Yes, Commissioner. I am mainly billing the state.

PN5

THE SENIOR DEPUTY PRESIDENT: I see. Well, Mr Szczepanowski, it is your application is it not? So I will turn to you. And I notice that your new agreement was certified some time in May, wasn't it? Yes, 27 May.

PN6

MR SZCZEPANOWSKI: Yes, your Honour. Yes.

PN7

THE SENIOR DEPUTY PRESIDENT: So you finally got there.

PN8

MR SZCZEPANOWSKI: We did. Your Honour, we have a situation where after extensive discussion, KCR operators and their union are indicating that they are unwilling to participate in any one of a number of possible crewing reduction proposals that would reduce manning by one per shift. The company has exercised its right under stage 5 of the dispute settling procedure in the EBA to refer the matter to the Commission for the conciliation. In the process, the company believes that it is lawful for it to direct that the proposed change now occur. Each proposal is an alternative or a reduction or one operator per crew. Currently there are 12 operators per crew on a three shift rotation. Overall, crewing therefore falls from 36 to 33, however there is a general relief currently in place for leave and absence cover which we plan to maintain.

PN9

THE SENIOR DEPUTY PRESIDENT: This is in a particular section of the plant, is it?

PN10

MR SZCZEPANOWSKI: Yes, your Honour, and I will refer to it in a moment. So in fact, proposed crewing falls from 37 to 34. Your Honour, I have a number of exhibits that will help with understanding the situation which I would like to now hand up.

PN11

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN12

MR SZCZEPANOWSKI: Your Honour, I have submitted four supporting documents. The first document headed, Chronology of Events, outlines the discussions that have taken place sequentially to date. The second document is in fact three pages with each an alternative way from the company for achieving the necessary change. The company's preferred option is the first, headed, Packaging Line. I have included a schematic of the KCR layout for the Commission's benefit as the next document.

PN13

THE SENIOR DEPUTY PRESIDENT: The product produced is what?

PN14

MR SZCZEPANOWSKI: The Kembla Copper Rod Plant (KCR) is a continuous melting, casting and rolling process producing mainly copper rod for processing mainly into power and telecommunications cables. 70 per cent of the output of the plant this year is for domestic consumption with the balance exported. We are the only significant domestic producer. Crewing on comparable plants around the world, Pirelli, Liverpool, UK, and Southwire, Georgia USA visited by a company person recently is less than the company's proposed crewing. These plants utilise comparable technology particularly following Kembla's recently completed SCADA upgrade.

PN15

Any safety implications related to the company's proposal have been considered with the direct employees and some minor process changes will be implemented as a result. The crewing reduction is necessary to retain a viable KCR business. Competition from offshore copper rod plants with lower crewing and the company's proposal drives this. The imperative for cost reductions in the total MM business is even more acute given that parts of our business are in a loss situation year to date. The company is currently undergoing cost reductions across the business with a voluntary redundancy scheme in place. For you information, your Honour, we expect 12 staff and 30 operative and trade related reductions.

PN16

The company is focussing its consultation on the necessary work practice changes directly with the employees involved in the changes. During our recently certified EBA process, all employees committed to the need for ongoing changes throughout the life of this agreement. The significance of increased import competition at high comparable cost structure and the fighting financial performance of the company all combine to make the current round of employee changes an immediate necessity and an absolute investment in the future performance of the business.

PN17

Aside from the real commitment to consult in line with our EBA, the company considers that there are no impediments to it directing the necessary changes to now occur and the consequences for failure to follow this will leave operators open to dismissal where they will all be losers in that scenario. In summary, your Honour, what we are proposing is legal, logical and safe. Manning levels and costs will still be above industry norms and in the process there will be no forced redundancies as a result of the change. That completes my submission, your Honour.

PN18

THE SENIOR DEPUTY PRESIDENT: Not being familiar with your new enterprise agreement, how is this a dispute over the application of the agreement?

PN19

MR SZCZEPANOWSKI: It relates to the dispute settling procedure on page 9, stage 5.

PN20

THE SENIOR DEPUTY PRESIDENT: Yes. But there has got to be a dispute over the application of the agreement to attract the Commission's jurisdiction.

PN21

MR SZCZEPANOWSKI: Should the matter not be resolved, the parties ..... further matter to the Australian Industrial Relations Commission for conciliation.

PN22

THE SENIOR DEPUTY PRESIDENT: Yes. But what is the matter?

PN23

MR SZCZEPANOWSKI: The matter is the crewing reduction which we have been told after extensive discussion is in dispute.

PN24

THE SENIOR DEPUTY PRESIDENT: How is that a matter covered by the enterprise agreement?

PN25

MR SZCZEPANOWSKI: Well, the process is the matter that is covered by the enterprise agreement and the company chooses to exercise its right under stage 5 of the disputes procedure to come to the Commission seeking conciliation of the matter.

PN26

THE SENIOR DEPUTY PRESIDENT: Yes, I understand that. You said that. But, you see, section 170LW which is, I understand, the area you rely on- - -

PN27

MR SZCZEPANOWSKI: I understand that to - - -

PN28

THE SENIOR DEPUTY PRESIDENT: Yes. Just looking at the application, it is by implication an application under section 170LW, it refers to procedures in the certified agreement for preventing and settling disputes. It goes on to deal with empowering the Commission to settle disputes over the application of the agreement. So it has got to be a dispute over the application of the agreement. How do you say this - I mean, what part of the agreement apart from the dispute settling agreement, what part of the agreement do we have a dispute over?

PN29

MR SZCZEPANOWSKI: We rely on the disputes procedure in stage 5.

PN30

THE SENIOR DEPUTY PRESIDENT: Yes, but that is going around in circles.

PN31

MR SZCZEPANOWSKI: Yes. We don't rely on any other ground in order to bring the matter before the Commission.

PN32

THE SENIOR DEPUTY PRESIDENT: Well, if that is the case the Commission has got no jurisdiction to do anything.

PN33

MR SZCZEPANOWSKI: Our alternative is to direct the change that we see as necessary to make. We chose on this occasion to bring it to the Commission as there is a prevailing attitude in the plant that the company doesn't have the right to make that direction. Now, the disputes procedure that we rely on hasn't changed and it was done having this process previously.

PN34

THE SENIOR DEPUTY PRESIDENT: Let me come at it a different way. Is there some provision in the enterprise agreement that you say enables you to go ahead and make this change? Or is there some section that is quoted as an impediment to change? I mean, just trying to - - -

PN35

MR SZCZEPANOWSKI: No, there is neither.

PN36

THE SENIOR DEPUTY PRESIDENT: So how can it be said this is a dispute over the application of the agreement? Other than a dispute over the dispute settling procedure.

PN37

MR SZCZEPANOWSKI: There is no other way.

PN38

THE SENIOR DEPUTY PRESIDENT: So, I mean, what you are saying is that there is nothing in the agreement that is relevant to how work is to be conducted or to manning levels.

PN39

MR SZCZEPANOWSKI: Correct, your Honour.

PN40

THE SENIOR DEPUTY PRESIDENT: You referred to safe, legal or logical. You weren't quoting from the agreement there?

PN41

MR SZCZEPANOWSKI: No.

PN42

THE SENIOR DEPUTY PRESIDENT: Yes.

PN43

MR SZCZEPANOWSKI: The terminology, legal, logical and safe, is in fact found in the underlying award, the Brass and Copper Award.

PN44

THE SENIOR DEPUTY PRESIDENT: Yes. Very well. Thank you. Yes, Mr Hancock?

PN45

MR HANCOCK: Thank you, your Honour. The KCR is a continuous hot metal works area and where a safe manning level of 11 have been in place since 1999 when they done the last changes. Due to them changes was due to some technical changes to a Coiler, I believe. And what the employers are saying, if the company decides to alternate the area with technical changes, then, fine, there will be a reduction of men. But as it is now, that is the agreed manning they have on the KCR. They have just done an agreement, an enterprise agreement which does not discuss any changes to the KCR as far as reduction, which is only about a month old. There is agreement on page 15 of the enterprise agreement Wire Consultative Committee where the KCR has an agreement with small bundles, which I believe that what the company is trying to take an employee away from.

PN46

THE SENIOR DEPUTY PRESIDENT: Sorry, say it again?

PN47

MR HANCOCK: I believe it said it on page 15, paragraph 35 under Wire Consultative Committee.

PN48

THE SENIOR DEPUTY PRESIDENT: KCR Agreement.

PN49

MR HANCOCK: Number 2, KCR Small Bundles.

PN50

THE SENIOR DEPUTY PRESIDENT: Yes. Well, I believe this is where they want to take an employee away from where they have an agreed safe manning level to bundle these packs.

PN51

THE SENIOR DEPUTY PRESIDENT: Is there something in here about agreed manning levels?

PN52

MR HANCOCK: I don't believe there is as written in the EBA but previously they had been an annex to it, I am not too sure - it's through the consultative committee. What our employees are really saying, your Honour, is that in 1999 when the changes were implemented through technical changes on the Coiler, the Coiler has been running a lot faster than what it was back in '99 where the manning was at 11. In '99 they have come from 1.8 metres per minute to 2.10 metres per minute.

PN53

THE SENIOR DEPUTY PRESIDENT: Metres per second?

PN54

MR HANCOCK: Per second, not - - -

PN55

THE SENIOR DEPUTY PRESIDENT: Yes. 1.8 to 2- - -

PN56

MR HANCOCK: 2.10 per second, metres per second.

PN57

THE SENIOR DEPUTY PRESIDENT: It can't be 2.10, it's 2- - -

PN58

MR HANCOCK: Point 180 to 210.

PN59

THE SENIOR DEPUTY PRESIDENT: Okay, yes, yes.

PN60

MR HANCOCK: It's the way I've got it written, your Honour. Sorry, I apologise for that.

PN61

THE SENIOR DEPUTY PRESIDENT: Yes.

PN62

MR HANCOCK: And also, I believe that if they are doing anything over 8 millimetres thick then they require an extra person, which has been amounting up once more. We understand that the company are looking at reductions because the company is in the position that they are in but we have got to look at in a safe manner, if you worked out a safe manner. We are quite happy to go into that kind of discussion but what I believe is that the company's just coming out saying, this is the way it is, we've got our ex supervisor, he is the work ..... this is what they believe it is so therefore that is how we see it. And that's all right for them to say that but again, they're not working on the mine no more, that's the operators and the operators believe that it is unsafe. They're at their safe manning level as it is and they do have one extra for training purposes. And if the company wishes to - I would like to go off record anyway, Commissioner and you'll hear it from the employees themselves because I'm not that familiar with the area. Thank you.

PN63

THE SENIOR DEPUTY PRESIDENT: Yes. Okay. Mr Szczepanowski, anything you want to cover in reply?

PN64

MR SZCZEPANOWSKI: Your Honour, the consultative committee document regarding KCR Small Bundles is a separate issue entirely. I can elaborate if necessary later. The bottom line is that the crewing we are proposing is actually higher than comparable plants with comparable technology around the world.

PN65

MR HANCOCK: And if I can interrupt, your Honour, that's fine to say but they have the technology. KCR Metal Manufacturers might not have that technology and if they actually had that technology the manning would be less.

PN66

MR SZCZEPANOWSKI: In summary, your Honour, there continues on site a strong view that employees have (1) the capacity to direct decisions regarding who does the work and secondly, that the company must call upon the Industrial Commission and enact stage 5 of our agreed procedure for the avoidance of disputes before fundamental business decisions are actioned. Your Honour, that completes what I have to say.

PN67

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN68

MR HANCOCK: Your Honour, if I could just add to that, there is no dispute unless there is going to start forcing unsafe practices and that's what I believe the employees are saying. You take a man away, we're talking about unsafe practices. You're putting the load on other employees to rush around and do this, do that, plus you've taken a load off the men at the Coiler end I believe we've just been talking about which just puts pressure on the. Why wasn't this discussed back in '99?

PN69

THE SENIOR DEPUTY PRESIDENT: Yes. The Commission will adjourn into conference.

<NO FURTHER PROCEEDINGS RECORDED