C2005/1835, Transcript of Proceedings [2005] AIRCTrans 1491 (11 July 2005)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 11983-1

COMMISSIONER SIMMONDS

C2005/1835

APPLICATION BY THE AUSTRALIAN WORKERS' UNION
s.113 - Application to vary an Award
(C2005/1835)

PERTH

9.58AM, WEDNESDAY, 22 JUNE 2005

Continued from 21/6/2005

PN1557

THE COMMISSIONER: Yes, there's a change to appearances from yesterday. Ms Watling?

PN1558

MS J WATLING: Thank you, Commissioner. In the beginning, Commissioner, we would seek to have our submissions in 21A marked as an exhibit.

EXHIBIT #W1 SUBMISSIONS

PN1559

MR CALVER: If it please the Commission, the document I have before me is dated 17 March.

PN1560

THE COMMISSIONER: No, that's not the submissions. The submissions would have been circulated some time earlier.

PN1561

MR CALVER: I see, thank you.

PN1562

THE COMMISSIONER: On 21 April. Is that right?

PN1563

MS WATLING: Thank you, Commissioner. We note in our submissions we have made reference to the agreement reached in conciliation proceedings of the termination of redundancy test case and this is seen in attachment A of our written submissions marked exhibit W1. In the proceedings the ACTU informed the Commission that the employer party and the employer parties that had obtained the approval of its union affiliate, including the AWU, to the terms of the agreement arising from the conciliation process, together with the terms of the agreement before the Commission referred to in clause 2 of the agreement, seen in attachment 1 of exhibit W1.

PN1564

We note in particular clause 4.1 of the attachment where it states that the parties agree to accept such wording in principle as the test case wording. Clause 4.2 of the attachment states the agreed changes are therefore intended to apply to the award to incorporate the test case standard as it currently exists. The AWU Construction and Maintenance Award currently contains certain clauses which merit a previous test case standard and it is the Australian Industry Group's concern that the AWU does not appear to be honouring the terms of the agreement rate given the position of this matter.

PN1565

With respect of the issue of the definition of redundancy the Australian Industry Group do not oppose the positions put forward by the CCF and make limited submissions on the issue of the definition of redundancy. We do however wish to address the facsimile sent by AI Group to Sam Wood of the Australian Workers' Union which is dated 17 March 2005.

PN1566

THE COMMISSIONER: Do you want me to mark that?

PN1567

MS WATLING: Yes, please, Commissioner.

EXHIBIT #W2 FACSIMILE TRANSMISSION AIG TO AWU DATED 17/03/2005

PN1568

MS WATLING: We advise that whilst we stated we note the particulars of the industry in that correspondence, the Australian Industry Group have not stated our position on the specific issue of the definition of redundancy. It may have been asserted by the AWU in previous written submissions, and I quote from page 3 of the Australian Workers' Union's submission titled Revised Submission Regarding Principle 10, which is that the AIG in its submission on definition of redundancy outlined that they and the ANCCF argued that the award should remain. AI Group have not put this position. As a matter of fact the AWU received a letter from the AIG agreeing on the issue on 17 March 2005 but raising issues on the form of the draft order.

PN1569

With respect to the facsimile dated 17 March, which is marked as exhibit W2, in that first paragraph we have stated that a draft order should contain clauses that are contained in the Full Bench decision and we do note that there are certain clauses which are not in the modern test case, but are not opposing the retention of certain clauses due to the particulars of the industry. We have not stated that the Australian Industry Group agree on the issue of the definition of redundancy. We have not made comment on this particular clause. Our position is that we do not oppose the position of the CCF and leave the issue of the definition of the redundancy to the determination of the Commission.

PN1570

With respect to the remaining draft order we would submit in accordance with the Full Bench decision found at print number 062004 all clauses should be inserted into the award. The Full Bench decision states at paragraph 30 that changes to a moral test cause are permissible to accommodate the individual circumstances of the particular industries. We would submit that the onus is on the AWU to satisfy the Commission that the variations to clauses set down by the Full Bench are justified, given the particulars of their industry.

PN1571

We state that failing this, that variation to the clauses needs to adhere to the test case standard and we have provided this position to the parties and to the Commission. Unless there are any further matters you wish me to address, this concludes our submission in this matter. If the Commission pleases.

PN1572

THE COMMISSIONER: Yes, thank you, Ms Watling. Ms Watling, do you want to remain on the video link or is that the extent of your participation?

PN1573

MS WATLING: That's the extent of my submission, Commissioner.

PN1574

THE COMMISSIONER: And participation in the proceedings, or do you wish to remain?

PN1575

MS WATLING: I would like to remain.

PN1576

THE COMMISSIONER: I don't know how long we've got. I think we operate on the basis that you weren't going to remain and I don't know how long we've got the video link booked for.

PN1577

MS WATLING: Would you like me just to run and check with the Registry?

PN1578

COURT OFFICER: I will go and check, Commissioner, but I don't think we can have it more than that.

PN1579

THE COMMISSIONER: No, I think the link is only available for an hour. So I understood from your earlier communication that you only wanted to be involved for the purpose of giving the submission/

PN1580

MS WATLING: That's correct, Commissioner. We would like to put our submission forward, but if it's convenient, if I could remain. If not, if I could please be - - -

PN1581

THE COMMISSIONER: Yes. I'll hear from the others what they think about that. I mean, I can't deny you it, but it is the problem with the technology, I'm afraid.

PN1582

MR CALVER: some of our materials are in the other court room, Commissioner, so I think - - -

PN1583

THE COMMISSIONER: Yes. No, I understand there's a further problem. You see, we were operating in another court room here in Perth because of the video arrangements are in a smaller court room, that compounds the difficulty. So I think probably in the circumstances I'll have to excuse you from further attendance in the proceedings.

PN1584

MS WATLING: Thank you, Commissioner.

PN1585

THE COMMISSIONER: We'll be ordering transcript for you and you'll get the transcript of the proceedings.

PN1586

MS WATLING: Okay, thank you.

PN1587

THE COMMISSIONER: The proceedings are adjourned.

<SHORT ADJOURNMENT [10.06AM]
<RESUMED [10.17AM]

PN1588

MR WOOD: If the Commission pleases, what I intend to do is bring to the attention of the Commission the 20-odd tabs of information I've provided to the Commission and then provide it in the witness statement to give further explanation to them and also rely on some of the witness evidence that has been given in relation to some of these tabs. In relation to tab 1, the witness statement of Mr Winter, the evidence of all the witnesses show at least one thing, that there was a meeting at the Melbourne Airport. The witness statement provided by Mr Winter indicates that he was at the meeting.

PN1589

I suppose it's fair to say that there were differing opinions throughout this hearing in the evidence as to whether the question of redundancy was ever put or not, but what is common, if he Commission was to draw the conclusion that the CCF did put the position about redundancy, their evidence was that the AWU didn't agree to it. It's my recollection, and it's the recollection of Mr Winter, that no such position was put. We rely upon not only our memories, but the time of such meeting. At the time of the meeting that we've been able to establish was in early 1999.

PN1590

At that stage Commissioner Merriman hadn't arbitrated the Building Construction Award, so it would be very unlikely that, given that the Commission had decided to use that award and in the evidence of S3, a letter sent by Senior Deputy President Watson to the CCF indicated that it was that arbitration by Commissioner Merriman, National Building and Construction Award, that was going to be used to then provide the other parties a draft from the simplification unit. So it's with that in mind that we say that it's very unlikely that the CCF would have even put a position about that given that it was well known within the industry and the industrial circles that the National Building Industry Award was the model award and it was going to be arbitrated and the meeting took place before that.

PN1591

Tab 2 is the respondents out of the award that's subject to this application. The purpose of this is to demonstrate to the Commission the complexities of this clause and how it's evolved over many years now. In all of the states there are redundancy funds that have been set up as a result of the awards. Not as a result of EBAs or agreements, because they weren't in existence at the time. These bodies, to deal with the issue of redundancy, were set up state by state. Now, in the State of Victoria, for instance, it was originally set up. It was called Incolink. As time moved on the metal industry, the people that worked in doing shutdowns and turnarounds also made a claim about having the same type of redundancy fund pay for their employees, and before the amalgamation of the Ironworkers to the isolated Society of Engineers and then, finally, to the AWU, they too were party of campaign to get that under way.

PN1592

Ultimately that was agreed with the industry. I want to say there was a little pain in getting to that point, but eventually it was agreed, and there became the creation of what they call a number 2 fund of Incolink of which we are a party. Following that there was the Electrical party, the Electrical Division of the CEPU also set up a fund, I think that became number 3 fund. When I contacted Incolink I wanted information about employers that employed less than 15 people that still contributed in to the fund and I gave them a copy of the list of Victorian respondents.

PN1593

Now, we say it's much bigger than that because if you're not a named respondent, they wouldn't have checked that. Incolink said they had some problems privacy wise in providing the information that we wanted. They didn't have a lot of time or resources to put to this question. So they said they would only check number 1 fund, which as it happened, we're not a part of. All our people, we would have assumed, are in mainly number 2 fund. But anyway, their efforts were appreciated by the AWU. They identified there are 15 employers with less than 15 people that are in the respondency list in Victoria alone.

PN1594

Now, our point on that, if you amplify the 15, you look at the number 2 fund, you look at there's over 800 respondents to this award. There's also respondency as a result of membership of the CCF, the MBA is quite large and the point we're submitting to the Commission is that all of this infrastructure is already in place and it's in place as a result of many decisions of both the Commission, the Full Bench of the Commission, the Federal Court and the High Court to adopt a certain standard of redundancy in the construction industry.

PN1595

It's not an issue that can be so quickly dispensed of and say, well, it doesn't apply any more. The reality is that, as time marches on, it does apply and we say that that it's appropriate that this award and this application to be made reflects that understanding, that agreement. In tab 3 we've provided to the Commission what we say is, if all of the other points are disagreed with, we rely on this final point, and that is that the Commission didn't have jurisdiction in the first place to change the definition in the processes it has got.

PN1596

I can explain that further. We understand that the Commission has got jurisdiction to vary an award and that's done under s.113, as this application is before the Commission now. But what we're saying is that whilst the Commission has jurisdiction to do that under s.113, it hasn't got jurisdiction to do that under the Award Simplification process, and if it hasn't got jurisdiction to do that, whatever it did at that time was in error. Now, we accept the Commission's decision on the question of error.

PN1597

Our whole purpose of coming here, at the end of the day and however it's done, for whatever reason, if we get back to the way we were before the simplification, and we get the definition that we say is appropriate for this type of industry, we haven't got an issue. But it is our intention to put all the arguments before the Commission in order for the Commission then to make their decision as to whether or not the application succeeds or not.

PN1598

In the High Court it shows the approach taken by the High Court in jurisdictional error in clauses 82 and 83, Coal and Allied Operations AIRC 2000 HC A47, and that says:

PN1599

Distinguishing cases where an officer or authority is simply made a factual or a legal error in the course of reaching a decision from case where the error is classified as a constructive failure to exercise jurisdiction is not all that easy. In the ordinary involvement of the latter ...(reads)... So much was earlier made clear by the House of Lords that -

PN1600

And then there's a case that is quoted:

PN1601

The difficulty of drawing a line between the real but arguably onerous exercise of jurisdiction and such an onerous exercise has amounted to a constructive failure of discharge under jurisdiction as a law requires ...(reads)... different opinions of this court.

PN1602

It goes on to say that "this present case is no exception." But the point we're making here, we rely upon this, is that a simplification process, as we'll go on further and show, was not about taking entitlements off workers, and whether right or wrong and I take the responsibility for this, that's what happened.

PN1603

Now, in truth it didn't happen because we say that an error occurred, that the employer never knew about it, that the infrastructure was already there, the Incolink was paid, there's been no evidence to come forward to say that they ever put out any circulars to say that this is the new achievement that they got. There's been no complaint by any employee that they haven't received their redundancy. So we say that if it was the intention of the employer to change the definition of redundancy, and they say that's their policy and we've heard enough evidence to believe that that's the case, it is their policy, the proper way in which to do that is to make an application under s.113. It is not to use a simplification process.

PN1604

Further, in R v Grey 1985 57 ELR paragraphs 49 to 30 the proposition that we put is further supported in that case. Finally, there was a matter before the Industrial Relations Commission in print 932082 paragraph 27, that the Commission found that:

PN1605

Even though the TWU had not raised the relevant award issue at the time the Commission could not certify an agreement if it did not pass the no disadvantage test.

PN1606

Now, I understand that it's quite different to this, but once again it falls in the same category as what we say that at any time if an applicant comes to the Commission and says this outcome was made without jurisdiction because there was an inappropriate test or the test wasn't applied properly or the application wasn't made in the right form as to the way it should be, so therefore the Commission had no jurisdiction to deal with it, even though they might have jurisdiction generally to deal with that question, but not under that type of application, the Commission has upheld that in the past and this case, we say, shows that.

PN1607

All cases that we have looked at basically show that the processes of changing various entitlements or making various applications must be in the proper format and we say in this case the change of definition, that didn't occur. Now in relation to tab 4 I understand throughout the proceedings of the Commission, in looking through the various transcripts, have advised the union and the other parties that there were different drafts or that there were earlier drafts. All I can say to the Commission about that is that I had a file made up of the simplification of the 1989 AWU Maintenance and Construction Award. All of that file they took and I put forward to you.

PN1608

So I don't for one moment suggest that there might not have been other drafts, but the drafts that is in tab 4 are the drafts that the AWU work from. It may have been that drafts were sent and, for whatever reason, they were given to different people. There was mention of Chris Birrell at being at one hearing, Margaret Piercy was at another hearing, Michael Borowitz' name has been mentioned, Craig Winter's name has been mentioned. So it may have been that these people who work for the AWU were getting various drafts that weren't coming to me.

PN1609

But when I did get a draft and it was together by the simplification union and I received a letter from Senior Deputy President Williams. That's the draft that I acted on and that's the draft I say that resolved in the making of the award now under this application.

PN1610

THE COMMISSIONER: Just bear with me for a minute. When do you say that that draft became available?

PN1611

MR WOOD: That draft has got a date received on 21 December 2000 and it was returned on 2 February 2001. So what I think what's probably happened, the draft was sent to Vice President Ross and after it was circulated was sent back to the Simplification Unit on 2 February 2001.

PN1612

THE COMMISSIONER: That's consistent with the reference in the transcript?

PN1613

MR WOOD: That is consistent.

PN1614

THE COMMISSIONER: Yes because - - -

PN1615

MR WOOD: It's just that the Commission brought to my attention that there was a draft apparently in August, I think that's - I might have got it wrong, but I understand that tradition said that - - -

PN1616

THE COMMISSIONER: No, that is consistent with the dates in the transcript, so I must have been confused by something else there.

PN1617

MR WOOD: There was a letter advising me on 28 August from Marg Piercy to attend the hearing in my absence. We then received a letter from the Associate to Senior Deputy President Williams and with that letter was accompanied a draft. Within the draft there was a - - -

PN1618

THE COMMISSIONER: Yes, that's where I'm getting confused. This letter is dated 28 August 2001.

PN1619

MR WOOD: Yes, and the letter I got from Senior Deputy President Williams' Associate was on 21 December 2001.

PN1620

THE COMMISSIONER: But that shows that the award as drafted was given to you in December 2001. "I enclose a copy of the award as drafted by the Award Simplification Unit."

PN1621

MR WOOD: They may have, I think just looking at those dates then, what they may have simplified the award but I didn't get a copy of it. So maybe what's happened is that when they wrote to me they provided that part of - - -

PN1622

THE COMMISSIONER: You've got Ms Piercy enclosing a copy, in her correspondence to you, enclosing a copy of the Draft Simplified Award.

PN1623

MR WOOD: Right.

PN1624

THE COMMISSIONER: That's in August, but there was a copy provided back in February/March.

PN1625

MR WOOD: February/March 2001?

PN1626

THE COMMISSIONER: Yes.

PN1627

MR WOOD: Right. All I can conclude from that is that there was a simplified award. It went out. I didn't get it. What I did get was a letter from Margaret on 28 August. Then a follow up letter by the Associate to Senior Deputy President Williams and it appears, and I have no issue with this, that what they sent to me was earlier drafts that were done on 21 December 2000.

PN1628

THE COMMISSIONER: 2 February.

PN1629

MR WOOD: Yes.

PN1630

THE COMMISSIONER: Which is the one that's referred to in transcript.

PN1631

MR WOOD: Yes.

PN1632

THE COMMISSIONER: So I think - anyhow, yes.

PN1633

MR WOOD: As can be seen in that draft I had made a number of references back to check with the National Building Industry Award. There is no mark at all in the redundancy section and I suppose where we say the error started from, but I didn't check that as I should have against the decision of Commissioner Merriman in his arbitration. Tab 5 basically is the history of letters from the Australian Industry Group, first of all on 13 February, where there was no mention of redundancy in that, but the issues that they had, there was another facsimile that was sent by Victorian Employers' Chamber of Commerce and Industry and that was on 15 February.

PN1634

On 18 February the Australian Industry Group sent another letter to us. The Civil Contractors' Federation on 21 February sent a letter outlining what they had issues with. On 19 April, again there was a letter from the Australian Industry Group. On 30 April the Civil Contractors' Federation sent another letter, and then finally I sent a letter to the parties and the Commission on 1 May. Now, all of those correspondence shows that at no time were the employers or the union ever talking about the issue of redundancy.

PN1635

We now get to the position of how all this was found out and that is contained in a letter to the Commission on 22 October 2004. The letter is undated but I've checked through my computer which has dates when documents are generated and we draw to the Commission's attention page 3 of that letter and we raise with the Commission the point, and I will read from it, it's the third paragraph:

PN1636

The AWU submits that the Commission did not have the jurisdiction within the process used for the simplification of the award or item 51 review to remove conditions of employment ...(reads)... not to use item 51 or the simplification process.

PN1637

So we did point out and, as we say, you know, there's been a decision about the error. It matters very little to us what conclusions the Commission comes to as to whether it grants the application for one reason or another. The main objective is to get agreement or to be successful in its application.

PN1638

As a result of that letter Senior Deputy President Williams circulated it, the letter that was sent by the AWU. The Master Builders' Association replied to that. The AWU replied to the correspondence by the Master Builders to the Senior Deputy President and we point out in that letter in the fourth paragraph, second sentence:

PN1639

What would be unfair is to allow employees' benefit in relation to a redundancy and to take the benefit off them through the process of simplification, the effect of not granting the application was removed ...(reads)... again unfair.

PN1640

Then the next paragraph, the MBA wrote to the AWU on 14 February 2004:

PN1641

The effect of the award variation being sought, making reference to follow the job load. This can be shown in the letter that has been accepted by the ...(reads)... and the fact that the Commission supported the view at all levels.

PN1642

Now, that point is, as I say, what has happened in terms of the industry viewing that this is a construction industry. It is different from the other construction industry. Now, they've always accepted that view and when the AWU sought a variation of, I believe it was the 25 per cent loading, they raised the issue about this as a construction award, they've got to follow the job loading built into the rate and therefore it wasn't appropriate that if the Metals Award moved that they should also pick up the same loading there.

PN1643

Now that matter went before Vice President Ross and was determined, but we found it quite strange that on the one hand the MBA is saying, you know, this is quite different. On the other hand they're saying, when it suits them, this is a family of construction awards. The same follows the job loading that is in our award is also in the National Building and Construction Award, and many of the provisions that are in that award are in our award and the Commission has followed that view too and that's why they simplified the National Building and Construction Award and arbitrated that first and that's of course the letter that was sent by Senior Deputy President Watson to say that now that that's done, we're going to simplify the AWU Maintenance and Construction Award along the same terms as the National Building and Construction Award.

PN1644

There's no real reference - - -

PN1645

THE COMMISSIONER: Sorry, can I just go back a step. You talked about the case where the casual loading is at issue. Do we have that in the papers?

PN1646

MR WOOD: No, I haven't. I did have a look at that but I concluded that it was a much different argument. It was about what happened in the Full Bench case with the 25 per cent, how that had any relationship to our award and ultimately Vice President Ross disregarded any reference to the followed job loading. All that that case did is looked at what conditions were in the AWU Maintenance and Construction Award, what conditions were in the Metal Industry Award, what casuals were not entitled to, what they were entitled to and did a comparison of those two and then came to a conclusion based on the earlier Full Bench as to whether our claim was successful or not and it was. It was granted. But, as I say, when I looked at that there was very little that I could rely on that case to say,
well - - -

PN1647

THE COMMISSIONER: But you say in the net case the MBA made a submission - - -

PN1648

MR WOOD: That followed the job loading which was dismissed by the Vice President. He said, well, you know, that's really got nothing to do with this application. So he didn't make any finding on the matter.

PN1649

THE COMMISSIONER: I see. So the point is simply that they argued one thing, the MBA argued one thing in one case and another in another?

PN1650

MR WOOD: Yes.

PN1651

THE COMMISSIONER: Yes, I see.

PN1652

MR WOOD: Tab 7 is only the transcript to those proceedings. Basically the only purpose of that is if it is required by the employers I can point to that whilst the direction order was dismissed by the Commission, the Commission said to the union that if it was their wish to press the matter, it would be more appropriate to do another s.113 rather than a direction order. That was the purpose of putting that transcript in. Once again with tab 8 it basically is the documentation of substitute of service and statement of service. Tab 9 there was some confusion about how I had done that, so there was another statement of service that had been sent out to the parties. That is for the Commission's benefit.

PN1653

Now, under tab 10 the AWU wanted to take the Commission through the various points raised in the simplification decision of December 1997, print H0008, and it's this decision that we say sets the framework as to how the Commission did have jurisdiction when the definition was changed. On page 3 of the Full Bench decision of P7500, the last paragraph, says:

PN1654

We have not altered entitlements obtained in the test case provisions other than where provisions are not allowable. We did not understand the joint government or the employers to submit that we should refuse such entitlements. We have, however, significantly altered some provisions in light of item 49(7) and (8).

PN1655

Page 4 at dot point 3 of P7500 it says:

PN1656

Existing rights and protection should not widely be set aside.

PN1657

At page 19, Allowances, dot point 3:

PN1658

The employer sought a deletion of a loading bay security officers' allowance at the Wrest Point Casino but gave no reason. As a general principle enterprise specific allowances should not be included in awards of general application. Nevertheless we cannot delete an entitlement of substance without examining the matter further.

PN1659

Page 29, should the Commission establish principles, in the first paragraph:

PN1660

In addition to the review of the Hospitality Award the employers' supported by the joint government asked us to provide general guidance to assist parties to others' awards in the proceedings applying to item 49 and 51.

PN1661

The last sentence in the last paragraph on page 29 says that:

PN1662

Without some guidance there is a potential for the review process to be repetitious and unnecessary time consuming, both for the parties and for the Commission.

PN1663

Page 29, second last paragraph in the last sentence, "The purpose of the principle is to limit discretion in all but the Full Bench cases." Page 30, second paragraph, second sentence, "In both cases principles, once established, are binding on members sitting alone." Page 31, dot point 2, point 2, "Are simplified and suited to the efficient performance of the working and the needs of a particular workplace or enterprise, section 88A." What we have to say about that is that this application is suited for the efficient performance and the working and the needs of a particular workplace or registry and that is amplified by the number of cases that have got the construction industry to this point about redundancy.

PN1664

Page 31, number 3, the first paragraph:

PN1665

A simplified award is one which provides minimum working arrangements encompassed entitlements to pay and conditions and reasonable protection for both employees and employers in assessing or granting of the entitlements.

PN1666

Now, we're saying the entitlement already existed. There's already been decisions of this Full Bench that was not about losing entitlements. Page 32, dot point 2, "It provides minimum entitlements for employees in relation to allowable award matters consistent with a safety net charter." We'll touch on that later because there is a Full Bench decision about that in terms of this provision. Page 33, 7, first paragraph, "The award simplification does not involve a general review of the level of award entitlements."

PN1667

Further it said that in the Workplace Relations in other legislations the Amendments Act 1996, items 46 to 54 of part 2, schedule 5, "Variations of the award after the end of the interim period." Page 50, it says, "Variations of the award" - - -

PN1668

THE COMMISSIONER: What's this page 50?

PN1669

MR WOOD: Of the decision. I think there was an appendix of the award simplification decision. At least I've got that. Yes, there's a page 50 in the decision.

PN1670

THE COMMISSIONER: The dot point is a reference to item 51(3).

PN1671

MR WOOD: Yes. I think what happened is they made a decision, then they put the appendix in about the access and then they go on to simplify the award. If it helps the Commission I can provide the whole - - -

PN1672

THE COMMISSIONER: No, it's all right. It is simply item 51, sub-item 3.

PN1673

MR WOOD: Yes, and it says that the variations of awards after the end of the interim period, section 3:

PN1674

When varying award under subsection 2 the Commission may also vary an award so that in relation to an allowable award matter, you ought express it in a way that reasonably represents the entitlements of employees in respect of the matter as provided in an award as is enforced immediately before the end of the interim period.

PN1675

And on page 51 of that decision, variation of awards after the end of the interim period, subsection 5, second paragraph:

PN1676

If the Commission varies the award under subsection 4 it must include in the award provision that ensures that the overall entitlement to pay provided by the award are not reduced by the variation unless the Commission considers that it would be in the public interest not to include such a provision.

PN1677

THE COMMISSIONER: But that relates to paid rates awards.

PN1678

MR WOOD: Paid rates awards?

PN1679

THE COMMISSIONER: Yes.

PN1680

MR WOOD: Okay.

PN1681

THE COMMISSIONER: You see, sub-item 4, "If the Commission varies the award under" - it should read "sub-item 4".

PN1682

MR WOOD: Yes.

PN1683

THE COMMISSIONER: 51, sub-item 4 refers to paid rates awards, or not minimum rates awards.

PN1684

MR WOOD: I'll stand corrected on that one, but the general thrust of our submission is that in all of the decisions of the Commission and all of the intention of the Parliament, the employers, simplification was not about taking entitlements off of employees. It was about simplifying awards. In this case entitlements were taken off of people and we want to restore those entitlements.

PN1685

THE COMMISSIONER: Well, I think the stronger point is 51(3), which is the one you've - the first of those dot points, yes.

PN1686

MR WOOD: Yes. In tab 11, this is the beginning of the history of the Construction Industry Redundancy Standard, as can be seen in the first application on 22 March 1989 in this particular application the Federated Ironworkers' Association of Australia was part of it, as well as the Australian Workers' Construction and Maintenance Consolidated Award 1987, on page 3 the decision says that, "We have decided to adopt redundancy payment scheme designed to meet the needs of the industry." On the next page in the start of the fifth paragraph it says:

PN1687

It is feared that many of the employees working in the building and construction industry for ...(reads)... employees working in the industry and therefore we determine that -

PN1688

And they go on to say that:

PN1689

All employees would be entitled to occlude redundancy benefits up to the time he or she leaves the industry. The ...(reads)... For that purpose implementation of credit will be given to the service to which the employee has been given his or her current employment.

PN1690

In the second last paragraph it says that:

PN1691

We now consider the argument advanced by the applicants to the scheme not contain exemptions for employees who employ 15 or less persons. In this connection we find the argument ...(reads)... for employers who employ 15 or fewer employees.

PN1692

Now that decision ultimately was taken to the High Court and that decision was - I forget the legal term - but it was stopped anyway, they weren't allowed to proceed with it. That caused a number of problems. Eventually on 19 October 1989 there was agreement to proceed as they found that in the reasonings of the judgments of the stopping of the earlier decision that there was shortcomings that they wanted to fix up.

PN1693

One of the awards that were dealt with was National Metals and Engineering On Site Construction Industry Award 1989 and it goes through to say that on 22 March there was a problem. I'll just withdraw that. Just going back, on 19 March 1989 the award that was dealt with was National Metals and Engineering On Site Construction Award 1989 but on the second page it talks about the Building Employers' Guild and it talks about the building battles of civil construction industries.

PN1694

THE COMMISSIONER: Where are you referring to now?

PN1695

MR WOOD: Well, they dealt with a whole bunch of - - -

PN1696

THE COMMISSIONER: No. What document are you referring to?

PN1697

MR WOOD: I'm referring to the decision of Commissioner Grimshaw on 19 October 1989.

PN1698

THE COMMISSIONER: Yes, okay. I thought you referred to something in March.

PN1699

MR WOOD: No, this is the second one. The first one, 22 March - - -

PN1700

THE COMMISSIONER: Yes. No, I understand.

PN1701

MR WOOD: And then the second one - High Court stopped that one - and then there was 19 October 1989.

PN1702

THE COMMISSIONER: Yes.

PN1703

MR WOOD: They dealt with a number of awards. We say that our award was one of them.

PN1704

THE COMMISSIONER: On what basis do you say that? It doesn't appear from the document that you've put in, that's all.

PN1705

MR WOOD: It does go on later and talk about - - -

PN1706

THE COMMISSIONER: Well, it may not be in dispute. Is there any issue about this?

PN1707

MR CALVER: We certainly don't agree, Commissioner, that the concept of the family of awards is - - -

PN1708

THE COMMISSIONER: No, no, no. I'm simply asking a simple question, that whether or not you concede that the decision of Commissioner Grimshaw on 19 October 1989 was a decision that affected the AWU Construction and Maintenance Award?

PN1709

MR CALVER: No, we don't concede that, Commissioner.

PN1710

MR WOOD: Well, as we go on you'll see that it does. It's not in - - -

PN1711

THE COMMISSIONER: Sorry. When you say you don't concede it are you saying you're putting it at issue, are you, Mr Calver?

PN1712

MR CALVER: No, we believe that the AWU should demonstrate to be so, Commissioner, that the onus is on - - -

PN1713

THE COMMISSIONER: Well, I hear what you're saying. So you're saying that there is some doubt about it?

PN1714

MR CALVER: I'm having difficulty in the tab that I have actually finding the decision, so I haven't had a chance to review that for the moment, so - - -

PN1715

THE COMMISSIONER: Well, it's at tab 11.

PN1716

MR CALVER: Yes, I have tab 11.

PN1717

THE COMMISSIONER: The first decision there is the Full Bench decision and that goes for six pages. Then the next one is the one that we're now referring to which - - -

PN1718

MR CALVER: And at print J2371? No, that's Palmer's decision.

PN1719

THE COMMISSIONER: No, 19 October 1989, 790/1989.

PN1720

MR CALVER: If you'll give me a moment, Commissioner.

PN1721

THE COMMISSIONER: Yes.

PN1722

MR CALVER: Commissioner, just re-examining the decision, the award currently under contention and that for its predecessors doesn't appear to be listed.

PN1723

THE COMMISSIONER: No, that's what I'm saying, it's not listed, but - - -

PN1724

MR CALVER: No, and therefore - - -

PN1725

THE COMMISSIONER: That may be a question of the printing off of it.

PN1726

MR CALVER: Well, therefore as it's not listed I stand by the proposition that if the AWU wishes to say that this is a decision which extended to the award currently before you, then that's a matter that clearly devolves to them to show, because it - - -

PN1727

THE COMMISSIONER: Yes, I understand that, Mr Calver. Mr Calver, I understand the legal position.

PN1728

MR CALVER: Yes.

PN1729

THE COMMISSIONER: I'm asking whether, in assisting the Commission to expedite proceedings, whether you are making that submission because there is a doubt in your mind as to whether or not this decision applied to the AWU Construction and Maintenance Award, and if so, that's fine. But if there is no doubt in your mind I'm asking you to consider in terms of the operations of the Commission whether or not you are - I mean - - -

PN1730

MR CALVER: Yes, I wish to assist the Commission wherever possible, but I have a doubt, given - - -

PN1731

THE COMMISSIONER: Okay, I accept that. Well, Mr Wood, you're being put to proof of it.

PN1732

MR WOOD: Okay. If I can just, rather than going through and reading the documents it's probably better if I explain. The 19 October 1989 that the High Court had stopped - - -

PN1733

THE COMMISSIONER: Yes. No, I understand your description of what's happened. The issue that is before me is whether or not the decision of Commissioner Grimshaw had any application to the AWU Construction and Maintenance Award or the predecessor of the AWU Construction and Maintenance Award 2002.

PN1734

MR WOOD: Right.

PN1735

THE COMMISSIONER: Now, the document you put in doesn't establish that.

PN1736

MR WOOD: No.

PN1737

THE COMMISSIONER: It talks about a number of other awards, but it doesn't talk about - - -

PN1738

MR WOOD: If I can answer the question this way. Initially when this application was made, the AWU wasn't mentioned. I don't say it was. But as we go through the history of this, on 10 October 1990 the AWU Construction and Maintenance Award 1987 and the AWU Construction and Maintenance Award 1989 are both mentioned and they get picked up as part of why we had the particular provision in the award in the first place.

PN1739

THE COMMISSIONER: So when do you say the AWU Construction and Maintenance Award, the predecessor to the award that's currently under examination, when do you say it obtained the redundancy clause that was in it pre-simplification?

PN1740

MR WOOD: On 10 October 1990 - - -

PN1741

THE COMMISSIONER: Where do I find that document?

PN1742

MR WOOD: It's in there?

PN1743

THE COMMISSIONER: In where?

PN1744

MR WOOD: Well, it's under tab 11.

PN1745

THE COMMISSIONER: Right.

PN1746

MR WOOD: There's a decision of Commissioner Palmer.

PN1747

THE COMMISSIONER: This is the one on 24 April?

PN1748

MR WOOD: 10 October 1990, print J4870.

PN1749

THE COMMISSIONER: Yes, I have it, right. It was a decision announced in Perth on 10 October which sets out the history of the matter.

PN1750

MR WOOD: Well, the purpose of putting the '89 in is to the fact to see how it all started.

PN1751

THE COMMISSIONER: No, I understand that.

PN1752

MR WOOD: But ultimately Commissioner Palmer picked it up in 1990, print J4870. He included our two awards and on page 6 of that decision he talks specifically about - he went on to advise that all respondents of the following awards had reached agreement on the proposed changes to redundancy provisions and then he lists the award. The awards that are listed include the Australian Workers' Union Construction and Maintenance Award 1989, the Australian Workers' Union Construction and Maintenance Award Consolidated Award 1987.

PN1753

THE COMMISSIONER: Sorry, I'm trying to find it. What page, because the pages aren't numbered?

PN1754

MR WOOD: It's actually page 5 and 6. I've numbered them myself because they weren't numbered.

PN1755

THE COMMISSIONER: So I count them in?

PN1756

MR WOOD: Yes, count - - -

PN1757

THE COMMISSIONER: Do I count the first page?

PN1758

MR WOOD: Yes. Page 5, right at the bottom it says Mr Kaufman.

PN1759

THE COMMISSIONER: The bottom of page 5 reads "Mr Kaufman then went on".

PN1760

MR WOOD: Yes, that's right and then on the top of page 6 there's a list of all the awards and the last two listed are the AW Awards and then it says - there's actually reference to those awards. After that it says it was noted that the Sprinkler Pipefitters' Award '75 and the National Metal and Engineering Award Industry '89 would need to be dealt with separately as would the two AWU Construction Awards, particularly as to the operative dates. Then two more pages in at page 8 on the third paragraph it starts with "an examination of the agreement", shows "the principle features are changes in the award, definition of redundancy". And the initiation of the redundancy provision employer rather than the employee, the present which he accepts, dismissal for misconduct or refusal of duty. That's where the definition came from.

PN1761

Then in the middle of the page it starts with, "I have decided to approve the application by the respondent parties in Sydney on 25 September 1990," and then three paragraphs down, "The variation will apply to the building awards cited and to the '87 or '89 AWU Construction Awards." I don't think it's necessary for me to take you through the whole history of how it all happened, but ultimately they're the submissions that we make in relation to how we got the redundancy and how the definition happened, was done by the Commission. It was by consent of the parties.

PN1762

THE COMMISSIONER: Well, the employers were all represented, weren't they?

PN1763

MR WOOD: Yes, that's right, and they all agreed.

PN1764

THE COMMISSIONER: No, I was just looking at who - - -

PN1765

MR WOOD: The names.

PN1766

THE COMMISSIONER: The names of those who represented them.

PN1767

MR WOOD: Yes. Tab 12, I don't need to go through all of these, but - no, I will go through - I thought it was another issue. These are decisions of the Commission that deal with a family of Construction Awards. The first one that we want to bring to the Commission's attention was a Full Bench by Senior Deputy President Keogh, DP Watson, at the time, and Commissioner Smith in Perth on 5 May 1992, print K2799. On the second page of 5, page 2 of 5, second paragraph, it says that:

PN1768

There was a decision to provide only one general standard of benefits to determine the Full Bench, the TCR case...(reads)... industry for the purpose of the application of the clause to employers who employ 15 or less employees.

PN1769

So this was a Full Bench decision that recognised that there was peculiar issues in the construction industry that required that type of dealing with. So we rely upon the Full Bench in that decision. Further, there was another Full Bench in Munro J, Senior Deputy President MacBean and Commissioner Eames, print Q1599 in Sydney, 4 June 1998. In paragraph 2 it says:

PN1770

We are satisfied that the variation of the award in terms set out in exhibit B13 would bring that award into the conformity with comparable Federal awards that apply generally in the building and construction industry throughout Australia. These provisions -

PN1771

And on Mr Bodger's submissions, on behalf of the applicant, the Construction Forestry Mining and Energy Union, corresponding state award reflect the outcome of the relatively tortuous process of arbitration and negotiation. The process resulted in the development of what is described by several Full Benches as one general statement of benefits to apply to redundancy in the building and construction industry. Now, we say, as the history shows, we were part of that process and have been for many years. Now, that decision by the Full Bench was accepted by all the parties and wasn't appealed after that decision was made.

PN1772

We now turn to print R7494. It's an arbitration by Commissioner Merriman in relation to the simplification of the National Building and Construction Industry Award. In the second page in clause 3, Definitions, it says:

PN1773

The CCF argues the definition covering mechanical plant operations and those associated with this section of the...(reads)... and incidental to the wage rate and the conditions and therefore the existing definitions will stay.

PN1774

Once again, that was not appealed. In clause 15, over the page, on the issue of Redundancy:

PN1775

All parties agree that the subject of redundancy is allowable. However the definition as contained within this award was argued by the government and some employers to be inconsistent with a test case and not consistent with the use of the concept of industrial practice in Australia

PN1776

Commissioner Wilkes in the Plumbing Industry Award decision, print Q8609 at paragraph 33 provides a number of reasons as to why he believed the redundancy provision in that award which is consistent with the Full Bench decision of the CBOA case. In addition to the reasons provided by Commissioner Wilkes:

PN1777

The Commission is of the view that substantial part of the redundancy provision and entitlements within ...(reads)... Commission's view it is allowable pursuant to section 89A(2)(m) and (n).

PN1778

Now, apart from the fact that the government and the employers argue their point and hadn't decided and didn't appeal it is further reason why we believe that they would never have asked at any time for this because they had just run the case and lost and accepted the decision.

PN1779

Tab 13, this is just further demonstration of how the Commission has handled construction awards. It goes to S3 and S4 that had been provided as evidence in these proceedings by the CCF and as we say, we only rely upon this to further demonstrate that it's been the intention of the Commission to group construction awards together, deal with them on a universal basis and that happened again in these proceedings. Tab 14, print K7300, it's a decision once again of a Full Bench. It mentions the AWU Construction and Maintenance Award. This was once again dealing with the issues that have been provided as evidence of S3 and S4 and this Full Bench talks about how different conditions sometimes cause problems.

PN1780

On page 10, now once again they're not numbered, but I've counted them through, I'll give the Commission some time to do that. I'm starting off where it says "The February '89 decision", about the last sentence in the second paragraph. Have you got that, Commissioner?

PN1781

THE COMMISSIONER: No, I'm not sure I have. What was the - - -

PN1782

MR WOOD: I beg your pardon?

PN1783

THE COMMISSIONER: Where are you starting from?

PN1784

MR WOOD: I'm starting from the second paragraph, the last sentence and it says "the February '89 decision".

PN1785

THE COMMISSIONER: Yes, I have it.

PN1786

MR WOOD: Now, it says:

PN1787

The February '89 decision set out in some detail the types of problem reflected in the existing award structures ...(reads)... and attempts are being made to move away from the highly centralised system which severely affect the State and National economy.

PN1788

The point we raise here is that it's our view that the Commission, for those reasons, should have the definition of redundancy, the same as all the other Constructions awards and put it back to the way it was prior to simplification. We have heard evidence from a witness today of the CCF that it would be unfair to turn around and say, well, here's a situation where, if you're a member of this union, you'll get paid it; if you're a member of that union you won't get paid.

PN1789

THE COMMISSIONER: I don't understand how that works, Mr Wood.

PN1790

MR WOOD: Well - - -

PN1791

THE COMMISSIONER: An employer would have to be a respondent to both awards before that happened.

PN1792

MR WOOD: To both awards, that's right, and that can happen. There's 800 respondents to this award. Now, I haven't done the exercise and I am prepared to do that if it assists the Commission, but there re employers that have been logged by the CFMEU and there's employers that have been logged by the AWU and they're both plant operators. Now, employers can be bound by more than one award.

PN1793

THE COMMISSIONER: Yes.

PN1794

MR WOOD: So if there's dual coverage - - -

PN1795

THE COMMISSIONER: Is there in fact a situation where employers are bound by both the National Building and Construction Industry Award and the AWU Construction and Maintenance Award 2002?

PN1796

MR WOOD: I haven't done the - and as I said, if it assists the Commission, I'll do it, I can find - - -

PN1797

THE COMMISSIONER: No, but see, you're making the point that in a circumstance where that exists there would be the possibility, depending on which union they're a member of. Now, I can accept the reasoning, it's whether the factual basis for what you're putting exists that I'm raising.

PN1798

MR WOOD: I'll withdraw that and I'll put it this way. It's possible that an employer can be logged and roped in by two awards. It's possible that they can both be plant operators. It's possible that one can be in the AWU and one can be in the CFMEU and therefore it's possible if this application were granted that one would get redundancy and the other one wouldn't if he decides to leave, he or she decides to leave. That's possible.

PN1799

THE COMMISSIONER: Is that right? What's the scope clause of the National Building and Construction Industry Award? I presume it applied to persons eligible to be members of the CFMEU?

PN1800

MR WOOD: As a matter of fact it says in the National Building and Construction Award that when it's a civil project or a civil work and they're plant operators, that award would apply to the extent of the scope and application. So it is possible that you can be a CFMEU member and paid a redundancy - - -

PN1801

THE COMMISSIONER: No, but you can be a non-member. You see, I would have thought that if both awards applied - well, sorry, I just don't know. But if the award application clause is the standard sort of clause, then it wouldn't matter what union you were a member of if you came within the scope clause of the award. You would have to get, as a minimum entitlement, what was contained in the - - -

PN1802

MR WOOD: Right, but the CFMEU claim, and they have got - and we've talked about it in evidence here - - -

PN1803

THE COMMISSIONER: Well, are you able to tell me what the scope clause of - is anyone able to tell me what the scope clause of the National Building and Construction Industry Award is? It's probably a very complicated one, is it, Mr Calver?

PN1804

MR CALVER: Yes, Commissioner, very complicated indeed. The scope provisions are in clause 6 of the award. They're modified by the exemptions in clause 8 of the award. The scope clause is basically divided into three parts, one that deals with trade persons and trade persons are excluded from coverage specifically under the AWU Construction Maintenance Award. The second is about labour classifications - - -

PN1805

THE COMMISSIONER: Which is where we'd find plant operators, I presume?

PN1806

MR CALVER: No, Commissioner, with respect, and then we have an operators classification. Yes, I apologise, it is a sub-component of the labours classification and subject to the exemptions and modifications it says in 6.1.3 of the National Building and Construction Industry Award, "This award applies to the employment of persons when engaged on construction and maintenance, alteration, repair or demolition work." The exemption provision though is complex in its inter-relationship with the scope clause. It's complex in the sense that clause 8.1 has a provision that deals with employees bound by the NBCIA where they're on a project where the majority of employees are covered by the award the subject of these proceedings.

PN1807

Then the relevant provisions of the award subject to these proceedings in certain respects applies in lieu of the provisions in the NBCIA and those provisions are hours of work, shift work, rest periods, camping allowance and accommodation on distant jobs. So you're perfectly correct that if there was a minimum requirement under the National Building and Construction Industry Award, even on projects where the majority of employees are covered by this award, then they would get the minimum entitlement under the NBCIA.

PN1808

THE COMMISSIONER: Regardless of what union they're a member of or whether they're a union member at all.

PN1809

MR CALVER: That's right and there's further complication in relation to New South Wales in clause 8.2.2 that deal with plant operators as well.

PN1810

THE COMMISSIONER: And again in Western Australia.

PN1811

MR CALVER: Yes, but in respect of Western Australia, emanating through the Western Australian award rather than from the provision of the NBCIA, Commissioner. I hope that assists the Commission.

PN1812

THE COMMISSIONER: It does indeed. So it doesn't seem to depend on what union you're a member of, Mr Wood.

PN1813

MR WOOD: Well - - -

PN1814

THE COMMISSIONER: It may not be the CFMEUs advertising campaign, but it's - - -

PN1815

MR WOOD: It may not but the reality is for someone who's worked in construction, as I have, you go to the employer and you say I'm a member of the CFMEU and they've got coverage for that work, they will apply that award. That's the reality of it. Now, whether in the strict legal sense that's right or not, but we're dealing with reality of what happens here and if I'm a member of the CFMEU - - -

PN1816

THE COMMISSIONER: But if you're not a member of the CFMEU- - -

PN1817

MR WOOD: Well, if you're not a member, he doesn't get the CFMEU award.

PN1818

THE COMMISSIONER: Why not?

PN1819

MR WOOD: Well, because it might - - -

PN1820

THE COMMISSIONER: The award applies to non-members as well as members.

PN1821

MR WOOD: Yes.

PN1822

THE COMMISSIONER: It applies to all, I would imagine, in the opening words of all that, it applies to persons eligible for membership of the CFMEU.

PN1823

MR WOOD: Yes.

PN1824

THE COMMISSIONER: Is that right? Is there something like that at the start?

PN1825

MR CALVER: I'm sorry, Commissioner, I've put it away.

PN1826

THE COMMISSIONER: That's all right. But, look, it isn't a members only award. It isn't a members only award.

PN1827

MR CALVER: No, no,

PN1828

MR WOOD: No, that's correct, not at all.

PN1829

THE COMMISSIONER: So the situation that you describe legally does not apply. If the employer is bound by the National Building and Construction Industry Award in respect of a plant operator - - -

PN1830

MR WOOD: Yes, but he might also be bound by the - - -

PN1831

THE COMMISSIONER: I understand that, but regardless of whether he's bound by the AWU Construction and Maintenance Award or not, if there's a better provision, he's got to provide it.

PN1832

MR WOOD: Yes. So is what the Commission is telling me, even if our application doesn't get up, they've still go to pay the CFMEU or AWU people?

PN1833

THE COMMISSIONER: If they're a respondent to the National Building and Construction Industry Award in respect of plant operators, which is the example that you've used.

PN1834

MR WOOD: Yes.

PN1835

THE COMMISSIONER: There's a couple of bit ifs there, of course.

PN1836

MR WOOD: Yes.

PN1837

THE COMMISSIONER: I mean, what I'm doing is responding to what I understand to be a secondary submission, which is the unfairness of what you understood the situation to be, that if a plant operator worked for an employer who was bound to the National Building and Construction Industry Award and the AWU Construction and Maintenance Award 2002, then it would depend on which union he was a member of as to whether or not he got the benefit of the redundancy provisions of the National Building and Construction Industry Award or the provisions contained in the AWU Construction and Maintenance Award 2002 and I was having some difficulty with that submission because, as I understood the general scope of the awards and subject to me - I mean, I've heard from Mr Calver, he's greatly assisted me, but from what I've heard there, it sounds as though that situation could not arise.

PN1838

MR WOOD: Well, I'll stand corrected, but I have reservations about if we're both working for the same employer and we're both covered by the same award and the employer says, all right, you're a CFMEU member, so we're going to apply that award for you and you're an AWU member and we're going to apply that award for you and we've got dispute findings in both cases, you're both doing plant operators, that I can't see that it is impossible, because if this person then leaves, an AWU person, and goes to the Commission and says, well, you're in the AWU, there's a dispute finding about the AWU, the AWU award applies, that's what you were paid under and you were paid - - -

PN1839

THE COMMISSIONER: But the award binds the employer in respect of persons who are eligible, who are or who are eligible to be members of the CFMEU.

PN1840

MR WOOD: No, but I'm just talking about the AWU people.

PN1841

THE COMMISSIONER: And so am I.

PN1842

MR WOOD: Yes.

PN1843

THE COMMISSIONER: Now, it doesn't matter whether they're a member of the AWU, whether they're a non-member, or whether they're a member of the Social Workers' Union, they are entitled because they are eligible to be a member of the CFMEU to the benefits of the CFMEU award.

PN1844

MR WOOD: Even if they're - - -

PN1845

THE COMMISSIONER: Full stop, full stop.

PN1846

MR WOOD: Well, it's our submission that - - -

PN1847

THE COMMISSIONER: Because they're eligible to be a member of the CFMEU. Now, if the National Building and Construction Award was a members only award, then the would not be entitled to it. But as I understand the National Building and Construction Award it is not a members only award.

PN1848

MR WOOD: No, it's not. Okay.

PN1849

THE COMMISSIONER: The reason for that is because the award is binding on the employer.

PN1850

MR WOOD: That's right, but if the AWU award is also binding on the employer - - -

PN1851

THE COMMISSIONER: Yes, they satisfy the requirements of the AWU award by paying the higher amount.

PN1852

MR WOOD: The CFMEU rate?

PN1853

THE COMMISSIONER: Yes.

PN1854

MR WOOD: Why can't they legally pay the AWU rate?

PN1855

THE COMMISSIONER: But how can they satisfy the legal requirements of the CFMEU award if they do that?

PN1856

MR WOOD: Because they are - - -

PN1857

THE COMMISSIONER: Because they're bound by the CFMEU award.

PN1858

MR WOOD: Why are they bound by the CFMEU and not the AWU award?

PN1859

THE COMMISSIONER: They're bound by both.

PN1860

MR WOOD: All right, and why then can't they pay the AWU rate?

PN1861

THE COMMISSIONER: Because in being bound by both they are obliged to comply with both. So that if someone resigns from the employer they are entitled to the provisions that are contained in this CFMEU award.

PN1862

MR WOOD: Okay, well, I'll take that - - -

PN1863

THE COMMISSIONER: And there is no breach of the AWU provision because the AWU provision only arises in circumstances of "true redundancy".

PN1864

MR WOOD: All right. Well, I'll take that, that they've got to provide, they're bound by both awards, they've got to provide the CFMEU award, yes.

PN1865

THE COMMISSIONER: I mean, look, that is far from being a determinative position because I haven't looked at the - but what I was referring to was your claim that somehow or another the employer would be avoiding me and Mr Calver is going to give me some more assistance.

PN1866

MR CALVER: Well, if it might assist the Commission, just to round out the interaction between yourself and Mr Wood, the parties bound clause of the National Building and Construction Industry Award has the following statement:

PN1867

This award shall apply to and be binding upon Construction Forestry Mining and Energy Union and its ...(reads)... in the states of New South Wales with a small exclusion, South Australia, Victoria, Tasmania only.

PN1868

And I think importantly for your discussion with Mr Wood:

PN1869

The employers and organisations of employers respondent to this award in respect of their employees or employees of their members within the classifications contained in this award, whether members of the organisation mentioned in 7.1 hereof or not.

PN1870

So in other words not members of - - -

PN1871

THE COMMISSIONER: Yes, so the standard provision.

PN1872

MR CALVER: Yes, sir, but the point you were making, whether or not they are members of the CFMEU, so I thought that I'd give further assistance in that regard.

PN1873

THE COMMISSIONER: Yes, thank you. Does that make it clearer for you?

PN1874

MR WOOD: Yes. I'm happy with that.

PN1875

THE COMMISSIONER: The Commission is here to educate people as well.

PN1876

MR WOOD: Tab 15, again, this was a decision that shows again that the AWU was part of the construction industry. It's a decision, print 901508, by Senior Deputy President Watson on 22 February 2001, first paragraph it says:

PN1877

This matter arises out of application to introduce into the family of building and construction industry awards new classification structures consistent with the August '89 National Wage Case Decision.

PN1878

Then there's a number of prints. It's got a long history recorded in decisions of the Commission, further prints, and then on the second page the Senior Deputy President says this, at paragraph 7:

PN1879

At this hearing the Commission noted the intention that the interim unit classification structure operating only by agreement and ...(reads)... introduced into such awards after such review.

PN1880

Then a number of prints.

PN1881

It was put to me and seems evident that the current clause 19 of the National Building and ...(reads)... in the same manner as occurred in the National Building and Construction Industry Award 2000.

PN1882

Now, I won't mislead the Commission and say that was initially then overturned. It, once again, goes to the statements, the evidence provided, S3 and S4, but I can also advise the Commission as early as last month we finally got that in by Commissioner Harrison, the new classification structure. We attempted to contact the CCF about them being party to this, despite a number of calls and a number of meetings and, as I say, this goes back to 1989, we've never ever been able to get them to even show up to a meeting.

PN1883

So I instructed Graham Beard to make the application, put it in. We had the support of a Full Bench. There's a Board of Senior Deputy President Watson, the CCF never showed up to the application. They were advised of it, the new structure went in there and the next I heard they were talking about appealing it but then I finished up having a meeting to clarify some of the points that were in it with the CCF, but after a long arduous period of time we finally, on our own motion, on our own draft, no involvement with the CCF, came to the Commission, got it put in and got that ratified.

PN1884

Tab 16, basically is information about the various awards - - -

PN1885

THE COMMISSIONER: And we've got that clause we've just been discussing.

PN1886

MR WOOD: Yes. Tab 16 talks about the coverage of the various awards. If I can hand up to the Commission, there is another award that has also got the same definition.

PN1887

THE COMMISSIONER: Yes, approach the bench. Multi-skilling you as well as educating you, Mr Wood. Thank you.

PN1888

MR WOOD: The award to be included into that is also the Western Australian award. There's a decision of the Commission. We point out in paragraph 4 of that decision, in this instance the parties, the Australian Workers' Union, the WA Chamber of Commerce and Industry and the Civil Contractors' Federation have been involved in numerous conferences with and without the Commission's presence. That was ultimately agreed. As we said, there's 353 respondents and the definition to redundancy is clause 11.1 and the definition is:

PN1889

Redundancy means a situation where employees cease to be employed by the employer respondent to this award other than for reasons of misconduct or refusal of duty. Redundant has corresponding meaning.

PN1890

That is the same definition as in all the other construction awards.

PN1891

Tab 17 shows to the Commission the definition that was in the AWU award prior to simplification. Tab 18 is just an extract as to what we say, if they did want to change the definition, they don't do it through simplification process, they do it through section 113, Powers to Set Aside or Vary the Award. Tab 19 is the way the Commission has dealt with redundancies in other than construction industries. The purpose of this material is just so, to bring to the attention of the Commission that the process basically used by the Commission for this type of work, if that, if our application was unsuccessful, would be the test applied by DP Keogh in the KMC Contractors Pty Limited and Others, print G6958, in 1 April 1987 and there is another print there by Commissioner Cox, print K0252, in 28 October 1991 and that verifies again that the test to be used is a KMC Contractors test and also you get a mention in that decision as well, Commissioner, on page 2 of 10. It talks about how the Electrical Contracting industry is done. So we provide that to the Commission.

PN1892

In tab 20 it has extracts from the recently run redundancy test case. There were just a couple of matters that we wanted to bring to the attention of the Commission in regards to this. The introduction in the last sentence, it says the standard clause has been subject to alteration from time to time to suit the circumstances of a particular industry. We say that we are such a case. On page 45 of 75, paragraph 244, it says:

PN1893

The exemption in the TCR Standard clause is expressed to be subject to an order of the Commission in a particularly redundancy case. In each of the following cases the Commission, after considering the circumstances of the industry, decided that the small business exemption should be removed from the award in question.

PN1894

And the second one was to Building and Construction Industry TCR case.

PN1895

I also want to point out at paragraph 227 - now, I'm not sure whether I've included that, I actually found it later. I can provide a copy to the Commission and to the parties of this decision. It says at 227 that:

PN1896

The evidence established that some small business make severance payments despite the absence of any legal ...(reads)... accordance with the TCR Standard clause despite the absence in any case of legal requirement to do so.

PN1897

Paragraph 228:

PN1898

The submissions by Job Watch and other evidence also support the proposition that some small business pay, severance pay, despite the absence of legal obligation.

PN1899

It's our submission that this goes further to show that an error did occur because all the evidence up to date has been about definition. There's been no evidence about small business exemption, but it appears in the AWUs award, as it is now, that there is an exemption for small business of 15 or less employees. Now, it might be that the employers can argue, there was no - you know, it's always been our policy that we've always wanted to have this definition there. But we say, and our submission is, that this is further proof that an error was caused because the exemption of 15 went in there, despite there being a case about it.

PN1900

There's no payment for it, there's no correspondence about it. There is no evidence in this Commission to say that we wanted that as well. There was no request from the employers about it. It was handled by this case that we were exempted and even if they weren't exempted they were paying it anyway, so we say that it was further evidence to suggest that an error had been made in the drafting of this award.

PN1901

In relation to the 1998 award we have this to say. Yes, the AWU did enter into an agreement of which I'll now speak to the National Secretary and advise him how that is being used against us. They have 32 respondents to that award. You only get in if we agree you get in. It doesn't apply to major projects. There is another award, the award that's just been sent up now, that has 353 respondents with the definition that we want in in this award that we say was the definition as it is now, is by error and surprisingly, when I look through it, you also had to be a member of the CCF to get in there. So that's another question that I will ask the National Secretary to look closely at to see whether that award continues or not.

PN1902

It appears that by the AWU wanting to try to do the right thing by a few employers that may have an argument, that have long standing in the thing, that is now being used against the AWU, and it's that use of that generosity that we've shown that we now, in my view, have to re-address whether we continue that type of cooperation with this industry, because it gets used against you. As I say, there's many safeguards we put in that award so it didn't get abused, but these employees have come forward and now want to apply that same standard to an award that operates right across the thing that's got a whole history of other awards, this definition, and in my view that's totally inappropriate.

PN1903

Now, in South Australia we've heard evidence that again they came with the same argument and the pay-off was $25. They paid over and above what is paid there. Now, the CCF don't even know that to be quite truthful because if you look at the last National Wage application that was made and the draft orders that were sent in by the AWU, the CCF came in and opposed it. They said, no, the calculations are all wrong and we pointed out to the CCF that, no, they're higher than the others because they've got a different definition. No, no, no. We need time. We don't want the Commission to go ahead with that. It took them to go to Business South Australia, Business SA, to a Mr Sheehan, who then put together the award and said no, that's right, you did pay any extra money to get the definition of redundancy.

PN1904

So they didn't even know that, at the time. That's further proof that what happened at the airport and what happened subsequently with the draft orders coming through, they never knew about. There was no memos that went out. Now, they say this is their policy. The CCF, this is what we want to change. Now, when they got it, what did they do? Nothing. There's no evidence before the Commission here that they even sent out a memo. Now, this is a major civil contracting award in this country.

PN1905

They've got a policy that they say that, in all the evidence, we've got to get this. Now, they got it and what did they do? Nothing. They didn't send out one memo to anyone to say that we've negotiated or the Commission has found that you don't now have to pay this redundancy, you've got to pay that one. No evidence at all. Another example of why this was, in our view - it shows that there was an error made. They didn't even know about it. They only found out about it - and the simplification of the Western Australian award, they say they agreed to the definition and the evidence was, but we're a small player. We haven't got many members in this award.

PN1906

Well, they've only got 32 respondents in the other award. So you can only conclude from that evidence that they're only a bit player in the state of Western Australia anyway. All of the evidence shows that there was an error made. All of the decisions of the Commission say that entitlements shouldn't be taken off the workers in the simplification process. That's what's happened and that's what this application seeks to address. If the Commission pleases.

PN1907

THE COMMISSIONER: Thanks, Mr Wood. Mr Calver? You've got agreement, have you?

PN1908

MR CALVER: Yes, sir.

PN1909

THE COMMISSIONER: Okay. Mr Stevenson?

PN1910

MR STEVENSON: Commissioner, could I just ask if I could have a very short adjournment?

PN1911

THE COMMISSIONER: Yes, certainly, and if you want to take your coats off, feel free. It's warmer here than it was in the other court. We'll go off record for good reason.

<SHORT ADJOURNMENT [11.59AM]
<RESUMED [12.05PM]

PN1912

THE COMMISSIONER: Mr Wood, you've indicated that you have to leave the proceedings. You've concluded your submissions in-chief. The issue is your submissions in reply. What I would do is at the conclusion of the employers' submissions, adjourn proceedings and give you an opportunity within seven days of the receipt of the transcript to make such written submissions in reply as you wish, reserving the rights of the employers to, if you raise new material, to make further submissions, and of course, your rights and response of that too, but hopefully you'll be very careful with your submissions in reply not to intrude too far. But I mean, everyone's rights will be preserved in respect of that. So that I would be directing that you lodge your submissions in reply within seven days of the receipt of transcript, that it should be filed via email addressed to my Associate and served on the respondents in the same manner, I think. You've got email addresses for them, and that should also include the AI Group.

PN1913

MR WOOD: Yes.

PN1914

THE COMMISSIONER: On that basis, Mr Stevenson, the ball is in your court, again.

PN1915

MR STEVENSON: Thank you, Commissioner. As I've indicated in my opening submissions the CCF opposes the AWU application. The CCF believes that no error was made in the simplification of this award in 2002. There is no mountain of evidence put by the AWU that the error has been made. There has not been any fabrication by the employers that was alleged and no mistake has been made. As I indicated, the onus should be on the AWU to prove the mistake was made by the Commission in the simplification process not to - - -

PN1916

THE COMMISSIONER: I don't think they're suggesting a mistake by the Commission. I mean, well, let me clear it up so that I do understand the AWUs case. It's at two levels. The first is there was a mistake by the Commission to the extent that it acted without jurisdiction because under item 51 of the WROLA Act it didn't have the power to vary an award other than to remove non-allowable matters and to make such other changes to awards as the items in the WROLA Act enabled. That's the first level.

PN1917

The second level of mistake is their mistake or error. Now, they're the two levels of mistake, have I got that right, Mr Wood?

PN1918

MR WOOD: That's right.

PN1919

THE COMMISSIONER: Yes, okay. Was that your understanding?

PN1920

MR STEVENSON: I was going to address the mistake the AWU alleges they made.

PN1921

THE COMMISSIONER: Sure, yes.

PN1922

MR STEVENSON: And that was perpetuated by the fact that the Commission believed it was a consent position and made the award in relation to the document that was prepared by the Award Simplification Unit. The CCF has always had a policy on what they call true redundancy and the AWU for a number of years have been aware of this. The evidence by Mr Batchelor, the current Chairman of the CCF National Industrial Relations Committee, and Mr Marsh, the previous Chairman of the National IR Committee show that the CCF has for a number of years had a policy of true redundancy or redundancy as generally understood in industrial practice to mean termination at the initiation of the employer when the employer decides it no longer desires the job to be performed by anyone.

PN1923

This policy was communicated to the AWU during negotiations for the simplification of this award which took place at two meetings, of which Batchelor and Marsh attended, and one of which Mr Wood at least attended. The CCFs position to change the redundancy provisions was also communicated to the Commission in the simplification matter in exhibit S4 that was spoken to by Mr Batchelor and - - -

PN1924

THE COMMISSIONER: But that wasn't the simplification matter. The simplification matter of this award was carried out by his Honour, Senior Deputy President Williams, and this correspondence went to Senior Deputy President Watson in regard to another matter altogether.

PN1925

MR STEVENSON: I believe, Commissioner, that Senior Deputy President Watson was dealing with the issue of simplification but - - -

PN1926

THE COMMISSIONER: No, simplification was in matter C number 640/98 and this is award restructuring that he was dealing with.

PN1927

MR STEVENSON: Yes. It has always been an issue that's confused us in relation to - - -

PN1928

THE COMMISSIONER: I'm not going to argue with that.

PN1929

MR STEVENSON: As to how long this matter was going on, but - - -

PN1930

THE COMMISSIONER: Well, see, award restructuring was initiated by initially Commissioner Merriman, although it looks like he didn't do anything with it, and then went to Senior Deputy President Williams. Yes, that's right.

PN1931

MR STEVENSON: Exhibit S3, which is the fax to the parties, talks about it being an application of a classification structure, the matter - - -

PN1932

THE COMMISSIONER: Yes, that's right.

PN1933

MR STEVENSON: The matter that Mr Wood has spoken about in his submissions.

PN1934

THE COMMISSIONER: But can I just draw your attention to that fax? It doesn't talk about award - it talks about the Structural Efficiency Principle of 1989.

PN1935

MR STEVENSON: I think there were a number of - - -

PN1936

THE COMMISSIONER: Nothing to do with award simplification.

PN1937

MR STEVENSON: But these matters all were negotiated at the same time with the AWU in relation - - -

PN1938

THE COMMISSIONER: Well, they might have been but they were different members of the Commission handling to them and to say the Commission was aware of it in the context of the award simplification would require more than that evidence because that evidence was sent to a different member of the Commission altogether.

PN1939

MR STEVENSON: I'm only relying on it in relation to the fact that it's the only written position that the CCF has to put forward to the Commission, that they had a policy to reform the definition - - -

PN1940

THE COMMISSIONER: I'm sorry, I thought you said, and that's why I interrupted, I thought you said that it was drawn to the attention of the Commission in the context of award simplification. That is, in the context of - - -

PN1941

MR STEVENSON: I withdraw that comment.

PN1942

THE COMMISSIONER: You may not have said that. I may have misunderstood you, but that was the only reason I interrupted.

PN1943

MR STEVENSON: It was communicated to the Commission in relation to matter number 20734 of 2000 but the letter stated an intention by the CCF to pursue reform of the award, hopefully by consent with the AWU, eg to change the redundancies' prescription. That's in the first dot point under point 1. In introduced that evidence only to suggest that the AWU would have been aware of the CCF position in relation to redundancy in that matter and generally they would have been aware of the CCF position.

PN1944

The evidence of Mr Morris and Mr Marsh, so that the Western Australian branch of the Civil Contractors' Federation was also aware of the CCFs national policy on redundancy and sought to have that apply to CCF members in Western Australia by engaging Mr Heelan to pursue this with the Australian Workers' Union. These negotiations took place and a deal was done, as was indicated by Mr Heelan in his evidence, which resulted in the AWU consenting to the Western Australian Civil Contracting Award 1998 which includes the CCFs preferred true definition of redundancy.

PN1945

Again this was followed by further instructions to Mr Heelan from the South Australian branch of the CCF for a similar consent award which also contained the definition of true redundancy. So there's two awards that the AWU consented to. Both of those were prior to the award simplification of the award that they're seeking to vary in this application. For the AWU to say they weren't aware of the CCFs position on redundancy, you know, has to be wrong. The National Secretary of the AWU knew what the CCF position was and those two awards are proof of consent by that union in relation to the CCFs preferred definition.

PN1946

Just in correcting some of the things that Mr Wood has just said in relation to how many employees are affected by the WA award I'm instructed that it's not only the named respondents in Western Australia that are covered by that consent award I just mentioned, but also by virtue of their membership, at least 80 other companies, who represent in total approximately 50 per cent of the Civil Construction Industry in Western Australia, and I might also add at this stage, seeing I did raise it in my opening submissions, that in relation to the question the Commission asked me about how many Common Rule parties may be affected in Victoria, my information from our Victorian branch is that there are 450, approximately 450 members of the CCF in Victoria and they believe that represents 50 per cent of the industry in Victoria.

PN1947

So both these awards, as I've said, in South Australia and Western Australia were prior to the simplification of the award that's been varied in this application. How can Mr Wood say that the position of true redundancy, which he did say in his evidence was never put to the AWU? It has to be false. The CCF also oppose the redundancy provisions in the National Building and Construction Award simplification case and again the AWU, by their own submissions, have acknowledged that.

PN1948

Now, the loss of memory of Mr Wood and Mr Winter to the dates and details of the meetings with the CCF at Melbourne Airport, I think the CCF provided more details, although it was a long time ago, in relation to those meetings. You know, it seems convenient for the union to put very little detail on those meetings and I think, really, that undermines the credibility of the statement that the CCF never put the definition of true redundancy to them. I mean, they don't even remember what year the meetings were in. You know, it's not surprising they don't remember the CCF putting certain positions to them.

PN1949

Similarly Mr Wood indicating that the absence of some scribbled notes on the documents that he did tender in his submissions, being a summary of the position drafted by the Award Simplification Unit, you know, provides no evidence that the matter wasn't dealt with in any discussions, that it simply means Mr Wood hasn't put any notes on that particular document.

PN1950

THE COMMISSIONER: Didn't Mr Wood give some specific evidence about that matter though?

PN1951

MR STEVENSON: Yes, that what I was going to, Commissioner. He indicated that he hadn't made any note on that document that appears in exhibit A4 and I'm simply saying that the fact that there isn't any notes written on that document doesn't mean anything really when it comes to whether the matter was discussed with the CCF. I mean - - -

PN1952

THE COMMISSIONER: Well, to be fair, hang on- - -

PN1953

MR STEVENSON: He puts notes against some other clauses, but - - -

PN1954

THE COMMISSIONER: No, but he actually gave some verbal evidence about that matter and I'm wondering whether he was cross-examined about it.

PN1955

MR CALVER: Assisting the Commission it's at PN547, the cross-examination about exhibit A4. If it please the Commission.

PN1956

THE COMMISSIONER: Yes, thank you. Yes?

PN1957

MR STEVENSON: Mr Wood indicates in the transcript there that he made an assumption. He hasn't communicated that assumption to anyone. I don't think that's sufficient evidence that a mistake has been made or that something wasn't discussed. It was simply an assumption by Mr Wood.

PN1958

THE COMMISSIONER: But that's his evidence.

PN1959

MR STEVENSON: That he's made an assumption that because he hasn't made a note on that document, it was never discussed?

PN1960

THE COMMISSIONER: No, no. He doesn't say that - what he says in his evidence is far from it. "I'm saying I got this, I started going through it and there were some clauses that jumped out at me that I thought I'd best check those. Redundancy wasn't one of those clauses. I just naturally assumed that everyone got the same conditions." Isn't that what he said in his direct evidence? I mean, that was in cross-examination.

PN1961

MR STEVENSON: I still believe it's just an assumption by Mr Wood.

PN1962

THE COMMISSIONER: Where does he say that? He says redundancy wasn't one of those that he checked.

PN1963

MR STEVENSON: He says at paragraph number 548 in - - -

PN1964

THE COMMISSIONER: Yes, I understand he didn't communicate the assumption. I certainly understand what you say about the fabrication and all of that, that much is clear but - - -

PN1965

MR STEVENSON: Mr Wood had indicated that he has a mountain of evidence that there's been a mistake made. But then, you know, he doesn't produce any documents, any negotiation documents - - -

PN1966

THE COMMISSIONER: Sorry, you don't want to take that point any further?

PN1967

MR STEVENSON: Well, no, Commissioner.

PN1968

THE COMMISSIONER: Okay. Press on, sorry.

PN1969

MR STEVENSON: Now, Mr Wood, in exhibit A6 on the second page, third paragraph down, indicates that the AWU provided Vice President Ross with a draft order to apply the test case provisions for TCR. This is last year in October 2004. He indicates further that at the time the CFMEU and the CEPU were in the Commission and saw the listing and went to the court and requested a private meeting with him about the application. Both unions raised some concerns so the AWU agreed to seek an adjournment so that the unions in the construction industry could meet at the ACTU and hear all points of view.

PN1970

He then goes on to say before the meeting of the constructions unions at the ACTU plant on 19 October the AWU put together a comparison of the redundancy provisions in all the construction unions and found what error had occurred. So Mr Wood didn't find out that that error occurred in his own evidence until 19 October 2004. He made an application prior to that and if I can just - I think I've already handed up - if I could just hand up one more exhibit. This exhibit or this document is a facsimile to the parties in the original application to vary the award for the 2004 redundancy test case.

EXHIBIT #S8 FACSIMILE TRANSMISSION RE APPLICATION TO VARY AWARD

PN1971

MR STEVENSON: Now in that application, in the draft order attached to it, at point 3, which I think is page 7 of the fax at the bottom, and I believe the writing on this document is from the CCF, not in the original fax sent to the CCF from the AWU, but the definition that he's seeking to include in the award at that stage is a definition of redundancy that occurs "when an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone and that the decision leads to the termination of employment of the employee except where this is due to the ordinary and customary turnover of labour."

PN1972

So if there was a mistake made and he realised it at some time, you know, we assume he has to have checked the award when he was making an application to vary it for this new test case provision, he would have picked up the error there. But he didn't pick it up until the CFMEU and the CEPU drew it to his attention. He's made an application to vary the award.

PN1973

THE COMMISSIONER: Yes, he admits that, he admits that.

PN1974

MR STEVENSON: So the CCFs view in relation to that, that the AWU didn't really believe they'd made a mistake, but when they were pulled in front of the ACTU or pulled into the ACTU offices by the CFMEU and the CEPU and required to hear all points of view from the other unions about what might have happened and how it could have ended up in that situation where the AWU award was different from the other awards that the construction unions had, suddenly the concept of a mistake occurred.

PN1975

THE COMMISSIONER: Are you saying that they weren't mistaken, that it was a conscious decision of the AWU to incorporate in the AWU Construction and Maintenance Award 2002 a definition of redundancy that was inconsistent with the claim that they'd made some years before? Are you saying that it was a conscious decision?

PN1976

MR STEVENSON: I'm saying it's a conscious decision for them to continue or perpetuate the current definition of redundancy, the true definition of redundancy in the award by virtue of the application they made last year.

PN1977

THE COMMISSIONER: No, no. I understand you to be saying that the AWU did not make a mistake in agreeing to the inclusion of the definition that's currently in the award as part of the award simplification process?

PN1978

MR STEVENSON: That's correct, Commissioner.

PN1979

THE COMMISSIONER: Now they mightn't have made a legal mistake, but you're saying - you know, if it's not a mistake in the non-legal sense, then it requires a conscious decision by the AWU that they were going to give up the form of redundancy that was in the award prior to simplification and adopt the arrangement of "true redundancy"?

PN1980

MR STEVENSON: Well, I - - -

PN1981

THE COMMISSIONER: And I frankly find that there is no evidence of that, to support that line of argument, and if there is, tell me about it.

PN1982

MR STEVENSON: Well, there's an absence of argument that a mistake was made. They consented - - -

PN1983

THE COMMISSIONER: No. Evidence that there is - all of the evidence points to the AWU making an error in not checking that the clause that went in to the award post-simplification was identical to that contained in the National Building and Construction Industry Award and the other construction awards. I mean, it might not be a legal mistake, but for it not to be an error it would require some evidence that the AWU, or an inference that was drawn from evidence, that the AWU took a conscious decision to support the proposition that the CCF had advanced on other occasions. Now, that's a pretty tall order on the evidence that I've heard.

PN1984

Let me put to you the evidence that I've heard. The evidence I've heard is that the AWU has agreed to such a thing in Western Australia and South Australia but only after they got some trade-off for it. There's no suggestion of any trade-off on this occasion and the evidence points to a situation where the AWU, through a series of proceedings, sought the introduction of the sort of definition of redundancy that was contained in the award prior to simplification.

PN1985

MR STEVENSON: I think the onus should be on the AWU to prove that they actually - - -

PN1986

THE COMMISSIONER: Well, what I'm saying to you is the evidence is there.

PN1987

MR STEVENSON: Well, I don't think there's sufficient evidence that they've made a mistake.

PN1988

THE COMMISSIONER: All right. I understand your submission, but excuse me if I - I'm drawing to your attention the difficulty I've got with it.

PN1989

MR STEVENSON: And the fact that the order was simplified in 2002 and they perpetuated their belief that the true definition of redundancy should be in there as late as October last year seems to suggest that they, you know, they'd given up any hope of having any other definition of redundancy and it wasn't until they were embarrassed, if you like - - -

PN1990

THE COMMISSIONER: Yes, but the evidence of Mr Wood is that he was not aware, his direct evidence about which he was open to be cross-examined was that he didn't become aware of this until - you know, it's contained in this document - until he went to the - till the CFMEU and the CEPU came to him and said, hey, hold off, he doesn't give us the benefit of that discussion, but he does say that he made a comparison prior to the meeting on 19 October and realised what had happened, and it wasn't until then that he made that realisation.

PN1991

Now, if you're suggesting that he manufactured that, then I'll have to ask you to take me to the cross-examination where you put that to him because it's a serious allegation.

PN1992

MR STEVENSON: Well, it's certainly convenient for him to not - - -

PN1993

THE COMMISSIONER: Well, did you put that to him in cross-examination? Did anyone put that to him in cross-examination?

PN1994

MR STEVENSON: I believe we did.

PN1995

THE COMMISSIONER: Take me to it.

PN1996

MR STEVENSON: At paragraph 558 Mr Calver in cross-examination indicates that the CFMEU in your mind had gotten something better than you and now you're seeking to characterise that as a mistake two and a half years later when all the objective evidence, your statement on transcript, is that you agreed with.

PN1997

THE COMMISSIONER: I understand that.

PN1998

MR STEVENSON: The objective evidence shows not a jot of a mistake and yet you're now saying that two and a half years later - - -

PN1999

THE COMMISSIONER: Yes. Are you saying that that - what is there about that evidence that I should regard as untruthful, because what you're saying is that he's not telling the truth in that evidence.

PN2000

MR STEVENSON: I have no evidence that he's not telling the truth.

PN2001

THE COMMISSIONER: Well, he's on oath, he says this and you're saying, on contradiction to that - - -

PN2002

MR STEVENSON: His evidence in relation to the meetings are unreliable in that, you know, he can't remember when the meetings were, the years they occurred, who was at them, what was discussed, but you know, I'm simply saying that his evidence is unreliable in relation to detail and what he can remember and, you know, whether he remembers it being a mistake or not.

PN2003

THE COMMISSIONER: So you're saying that his evidence in paragraph 558 should be disregarded?

PN2004

MR STEVENSON: Yes, that that evidence only shows that he, in retrospect, had decided that there's been a mistake made and that is after he's met with the other unions and it's now convenient - - -

PN2005

THE COMMISSIONER: If he'd realised that there was a mistake made at the time he wouldn't have agreed to the amendment, that's what he says.

PN2006

MR STEVENSON: Well, he indicated that he was incompetent in relation to - - -

PN2007

THE COMMISSIONER: Yes, and you might want to agree with that, but to say that he's a liar, which is what the effect of your submission is - - -

PN2008

MR STEVENSON: I'm not saying he's a liar, Commissioner. I'm simply indicating that his memory - - -

PN2009

THE COMMISSIONER: Well, I'm sorry, you are.

PN2010

MR STEVENSON: His memory of a mistake, he had ample opportunity to look at the documents before he made the application in 2004 and he's perpetuated the mistake by putting it in his own draft order and - - -

PN2011

THE COMMISSIONER: Exactly. That's exactly what he says. He perpetuated the mistake. I mean, they're not the words he used, but that's the effect of it.

PN2012

MR STEVENSON: But if the CFMEU hadn't intervened in him proceeding with that at the time - - -

PN2013

THE COMMISSIONER: Exactly, that's what he says.

PN2014

MR STEVENSON: I don't think we'd be having this argument today.

PN2015

THE COMMISSIONER: That's all consistent with it being a mistake, isn't it?

PN2016

MR STEVENSON: Well, it didn't suddenly come to Mr Wood's mind when they drew that to his attention. It took a meeting at the ACTU on - - -

PN2017

THE COMMISSIONER: No, no. It didn't take the meeting at the ACTU. His evidence is that prior to the meeting at the ACTU he made a comparison of the awards and established that the other people had not lost the "untrue" definition of redundancy.

PN2018

MR STEVENSON: Yes, Commissioner.

PN2019

THE COMMISSIONER: That's his clear evidence. Now, I want to make the point that it doesn't make it a legal mistake. Mr Calver has quite properly made that point and we get into some difficulty by using the word mistake all the time, and that's why I like to use the word error, but as I understand it your submission is effectively that the AWU consciously agreed back in whenever it was to incorporate in the Construction and Maintenance Award a definition of redundancy that was at odds with what had been there before.

PN2020

MR STEVENSON: Yes, Commissioner. That's the - - -

PN2021

THE COMMISSIONER: And if I'm to accept that submission I have to reject the evidence of Mr Wood that is contained for instance at paragraph 547 and what basis is there for me to reject that evidence which was given as sworn evidence in this Commission?

PN2022

MR STEVENSON: Well, Commissioner, in the same evidence Mr Wood indicated that he'd never - that the position of redundancy had never been put to the AWU by the CCF and I think it's clearly been demonstrated by the CCFs witnesses that not only has that policy been put to the AWU, but the AWU have acknowledged it by consenting on two other occasions. So his statements, you know, may not be completely correct.

PN2023

THE COMMISSIONER: Sorry. Where does he say that?

PN2024

MR STEVENSON: Well, I can't take you to the paragraph number but it was in my cross-examination of Mr Wood, he indicated they never asked for it, in relation to the definition of redundancy and they never put anything at all, just going from my notes at this stage.

PN2025

THE COMMISSIONER: Yes, but that was in the context of - wasn't that in the context of this particular award?

PN2026

MR STEVENSON: That's correct.

PN2027

THE COMMISSIONER: Well, then how does the fact that they've agreed to it in two other awards - - -

PN2028

MR STEVENSON: I'm only bringing that up in relation to how reliable Mr Wood's evidence is. You know, he's - - -

PN2029

THE COMMISSIONER: Well, if I've got to make a finding about - I've got two people saying it wasn't raised at a meeting and two people saying it was raised at a meeting.

PN2030

MR STEVENSON: Well, I think you've got two witnesses from the union saying they can't remember when the meetings were and what was raised, but they seem adamant that certain things weren't - - -

PN2031

THE COMMISSIONER: No, both of them said that that issue wasn't raised and I've got two employer witnesses saying that it was raised and you're asking me on the basis of that evidence to treat Mr Wood's evidence, for example, in paragraph 547, as unreliable.

PN2032

MR STEVENSON: It's an issue of his memory. He selects certain issues he can remember and other issues he can't. So - - -

PN2033

THE COMMISSIONER: Well, that's not unusual in human behaviour. I don't find there's anything significant about that. I mean, forensically what we've got is evidence of Mr Wood in 547, and elsewhere, but that was where he was cross-examined on it, and it's consistent with the whole story and you're asking me to disregard that direct evidence because Mr Wood is not a reliable witness and your basis for that is that he gives a different version of events of what occurred at a meeting that no one knows the date of, that no one has kept a diary of, that no one has kept a record of from two other witnesses.

PN2034

MR STEVENSON: Well, yes, Commissioner.

PN2035

THE COMMISSIONER: Okay. Is that a convenient point to adjourn for lunch?

PN2036

MR STEVENSON: It might be, yes.

PN2037

THE COMMISSIONER: Okay. Adjourn until 2 pm and Mr Wood, have a safe trip back.

<LUNCHEON ADJOURNMENT [12.44PM]
<RESUMED [2.00PM]

PN2038

MR STEVENSON: Commissioner, in relation to the reliability of Mr Wood's evidence it's more about the reliability of Mr Wood's memory. Mr Wood has convinced himself of the truth of an error and it seems convenient for the union that he didn't convince himself of that until after he had a meeting with the other construction unions late last year and the only area I want to just draw an example of in Mr Wood's evidence where he contradicts himself in relation to his own memory, he says at paragraph 490, in response to my question, that, "Were you aware of the CCFs position that they put to you, the AWU, in relation to redundancy and particularly the definition of redundancy?" He indicated, "They never, they never ever put anything in relation to redundancy to me."

PN2039

Then later on in the transcript he indicates at paragraph 498, "So you were aware that the AWU" - when I asked the question - "So you were aware that the AWU had consented to the definition in both of the two awards that is similar to the definition?" He responded, "I wasn't aware of the Western Australian one and I was aware that the definition wasn't in the South Australian one." So, I mean, he's indicated that - you know, we never ever put the position to him but he was aware of it, so, you know. It's just one small example. I really don't - - -

PN2040

THE COMMISSIONER: Sorry, I don't follow that. Para 490, now what do you say is - - -

PN2041

MR STEVENSON: He indicates that, "They never, they never ever put anything in relation to redundancy to me."

PN2042

THE COMMISSIONER: No, I understand that.

PN2043

MR STEVENSON: And he acknowledges later on that he wasn't aware of the Western Australian one, but that he was aware that the definition wasn't in the South Australian one.

PN2044

THE COMMISSIONER: Yes, so how does that amount to - - -

PN2045

MR STEVENSON: Well, he was aware that the definition wasn't - - -

PN2046

THE COMMISSIONER: No. See, you're talking about meetings prior to 490 and he took it, quite clearly, that your question in 490 was about those meetings.

PN2047

MR STEVENSON: Well, I believe his response to that was that we never ever put anything to him in relation to redundancy - - -

PN2048

THE COMMISSIONER: Yes, that's right.

PN2049

MR STEVENSON: And he was never ever aware of - - -

PN2050

THE COMMISSIONER: No, no, no. "They never ever put anything in relation to redundancy to me." That's what he says, in the context of the meetings that he had with the CCF. Then you say, well, I put it to you that the CCF put a position to the AWU in relation to redundancy that was similar to that that was in the West Australian Civil Contracting Award and he says no, it didn't. Then you say, "Well, I put it to you that the CCF put a position to the AWU in relation to redundancy that was similar to that that was in the West Australian Civil Contracting Award." And he says, "No, it didn't." So he's talking about the meetings there.

PN2051

MR STEVENSON: Look, I'll withdraw that example, Commissioner. Commissioner, if I can just hand up one more document. I don't know if you need to mark this as an exhibit, but it's the summary of redundancy in the building and construction Industry from the Coal Royal Commission.

EXHIBIT #S9 SUMMARY OF REDUNDANCY COAL ROYAL COMMISSION

PN2052

MR STEVENSON: Volume 11, Chapter 13. It just provides some useful background to some of the decisions which I don't intend to go into in any detail at all. However, I may just refer to it in relation to - what I indicated I would say in my opening statement regarding the allowability of the definition of redundancy. Commissioner Merriman in July 1999, print R7494, is relied upon by the AWU in their submissions. However, Commissioner Merriman, in his conclusions regarding the allowability under section 89A(ii)(m) of the Act paid no regard to the Full Bench decision in Gordonstone Coal Management, print 9213, which I think has already been handed up yesterday.

PN2053

That decision at page 17 of the document I handed up in the last paragraph says:

PN2054

The expression 'redundancy pay' in paragraph 89A(ii)(m) does not appear to have any readily identifiable source in industrial practice. However, in industrial jargon it has a reasonably clear meaning. It may be taken to mean the payment made upon termination or severance from employment in circumstances where an employee's services are no longer needed by the employer.

PN2055

I emphasise that phrase "where an employee's services are no longer needed by the employer." Now, the definition of redundancy in this award meets the requirement of allowability as it currently exits.

PN2056

THE COMMISSIONER: Your organisation appeared in that matter before Merriman?

PN2057

MR STEVENSON: Yes, we opposed the redundancy provisions - - -

PN2058

THE COMMISSIONER: Did you appeal the decision?

PN2059

MR STEVENSON: No. Commissioner Merriman in his decision dealt with, obviously, a number of issues and in relation to redundancy, from what I can see in this decision, did not get into the detail which this Full Bench decision does in relation to finding that in industrial jargon it's a reasonably clear meaning what the definition of redundancy pay is. Now, if we go to the document that I just handed up, S9, it just indicates there that the classic - well, the definition of redundancy that the AWU seeks to have in this award by their application which includes a termination at the initiative of an employee being regarded as redundancy cannot be said to meet the classic definition of redundancy, which is spelled out in S9 there, in relation to the Adelaide Milk Supply Co-op definition on the first page which is that:

PN2060

The concept of redundancy seems to be simply this, that a job becomes redundant when an employer no longer desires to have it performed by anyone. A dismissal for redundancy seems to be a dismissal not on account of any personal act or default of the employee dismissed or any consideration peculiar to him, but because the employer no longer wishes the job the employee has been doing to be done by anyone.

PN2061

So we've got the classic definition of redundancy that people understand. The definition in the other construction awards, the National Building Industry Construction Award that the AWU now seeks to put into the award subject to this application is so far different from that classic definition of redundancy and by virtue of the Full Bench decision in Gordonstone Mining it can't be seen to be identified as having a source in industrial practice or industrial jargon and that Commissioner Merriman, in his decision, paid no regard to that Full Bench decision of Gordonstone Coal Management.

PN2062

THE COMMISSIONER: Was it before him?

PN2063

MR STEVENSON: I'm unaware if it was before him, Commissioner, and I only raise it because it just touches on an area of allowability that may not have been dealt with in that decision of Commissioner Merriman which is heavily relied upon by the AWU in relation to it being allowable and therefore being inserted into this award, the AWU Construction and Maintenance Award 2002. In conclusion I'll just narrow it down to four points, that CCF are saying - - -

PN2064

THE COMMISSIONER: But doesn't S9 recognise that it's redundancy?

PN2065

MR STEVENSON: Adelaide Milk Supply - - -

PN2066

THE COMMISSIONER: No, no, I understand that. The chapter heading is called Redundancy in the Building and Construction Industry and it talks about the Federal Award variation not being amended and it relates to redundancy. This is in paragraph 28, the last paragraph on the extract you've given me. It doesn't talk about quasi-redundancy or anything like that. It says redundancy in the building and construction industry and it's clearly dealing with this clause, or the clause in the National Building and Construction Award.

PN2067

MR STEVENSON: Well, the full chapter in the Royal Commission's report on that deals with all the issues in relation to redundancy, not just the definition obviously. I only use that exhibit S9 as a convenient way to introduce the classic definition - - -

PN2068

THE COMMISSIONER: But the point I'm making is they don't call it quasi-redundancy or they don't call it non-traditional redundancy or anything like that. They call it redundancy in the building and construction industry. They seem to agree that it's redundancy.

PN2069

MR STEVENSON: Well, yes, Commissioner, but it isn't necessarily allowable under the Gordonstone Coal Management decision.

PN2070

THE COMMISSIONER: Well, is that what Gordonstone is going to?

PN2071

MR STEVENSON: I'm sorry, I didn't hear that, Commissioner?

PN2072

THE COMMISSIONER: Is that what the Gordonstone decision is going to in that extract that you've taken me to?

PN2073

MR STEVENSON: It's only one area that I believe hasn't been dealt with previously in relation to allowability of the redundancy provision being inserted into simplified awards. It's not, you know - I present it simply for the Commission's information so that when you do look at the submissions that the AWU have made, heavily relying on Merriman's decision, you can take into account that it doesn't appear that Commissioner Merriman took this decision into account and this decision confirms that to be an allowable matter redundancy needs to be in circumstances where an employee's services are no longer required by the employer.

PN2074

There's no decisions that seem to indicate that the building and construction industry definition specifically is allowable.

PN2075

THE COMMISSIONER: Yes. Commissioner Merriman's decision.

PN2076

MR STEVENSON: And we would say that that decision pays no regard to this Full Bench decision and therefore - - -

PN2077

THE COMMISSIONER: Just because it doesn't pay regard to it doesn't make it inconsistent with it.

PN2078

MR STEVENSON: Well, it's the only point I want to raise in relation to that, that that decision wasn't regarded by Commissioner Merriman and it was a Full Bench decision. That only talks about - - -

PN2079

THE COMMISSIONER: Well, you've agreed that your organisation was a party to that proceeding?

PN2080

MR STEVENSON: They did appear in that and - - -

PN2081

THE COMMISSIONER: And had the opportunity to bring the Gordonstone decision to his attention?

PN2082

MR STEVENSON: I'm unaware of it.

PN2083

THE COMMISSIONER: That's right. So if he didn't have regard to it that's at least in part because if he didn't have regard to it, and I haven't read the Merriman decision until today, but if he didn't have regard to it, then that's at least partly your organisation's fault.

PN2084

MR STEVENSON: Well, I'm only raising the issue because we're aware of it now and we're in front of the Commission on an application to find this same clause allowable and it would be appropriate, now that we are aware of it, to raise it.

PN2085

THE COMMISSIONER: Yes, certainly.

PN2086

MR STEVENSON: So in conclusion I really just need to say that the CCF believes that the current provision that the AWU is seeking to insert is not an allowable definition under section 89 of the Act. It shouldn't be inserted for
that - - -

PN2087

THE COMMISSIONER: Sorry, can I just stop you there. The difficulty I have with the submission so far is that it's referring to Commissioner Merriman's decision. Now, Commissioner Merriman's decision adopts quite clearly the decision of Commission Wilkes in the Plumbing Trades' decision and I don't have that before me, so it may be that Commissioner Wilkes did specifically consider Gordonstone and thus, by implication, what you're saying is not correct. Now, without having the fullness of the Wilkes decision before me, I mean I'm going to have to look at it at some stage, but you do take that into account, don't you? You accept that that - - -

PN2088

MR STEVENSON: I'm aware of the Wilkes' decision, I've looked at it and if you'd bear with me for one minute. Commissioner, I can later on in the proceedings provide a copy of the Wilkes' decision, but we don't believe that it has dealt with it either.

PN2089

THE COMMISSIONER: No, there's no need to provide a copy. I can access a copy easily enough.

PN2090

MR STEVENSON: So neither the Wilkes - - -

PN2091

THE COMMISSIONER: All I'm suggesting to you is it's a matter I have to give consideration to in considering that decision.

PN2092

MR STEVENSON: I understand.

PN2093

THE COMMISSIONER: Yes.

PN2094

MR STEVENSON: Yes, Commissioner, I think there's a number of decisions over the years in relation to redundancy and the whole development of these clauses which all relate to that final decision of Commissioner Merriman but I don't - - -

PN2095

THE COMMISSIONER: Sorry, I wasn't going at it from that direction. I was just going at it on the issue of allowability, yes.

PN2096

MR STEVENSON: Yes, but I don't intend to go any further in relation to the history. It's all there in the AWUs - - -

PN2097

THE COMMISSIONER: No, no. Sorry, I wasn't talking about it from the point of view of the history of the award or of redundancy. I was talking about it from the point of view of the argument that you're making in respect of the allowability of the redundancy provision that the AWU seeks to have reinserted in this award.

PN2098

MR STEVENSON: Yes, Commissioner.

PN2099

THE COMMISSIONER: That was the importance of it.

PN2100

MR STEVENSON: So further, in conclusion, the AWU consented to the existing clause during the award simplification process, we say, in the full knowledge of the CCFs policy and its position in those negotiations in relation to redundancy, that there's insufficient evidence by Mr Wood on the mistake and that the AWU have not met the onus to prove any mistake has taken place and that the application in its current form should be rejected by the Commission and that concludes my submissions on behalf of the CCF. If the Commission pleases.

PN2101

THE COMMISSIONER: Yes, thank you, Mr Stevenson. Yes, Mr Calver?

PN2102

MR CALVER: If it please the Commission. My remarks this afternoon will be divided into two components. The first component is in answer to some of the matters that Mr Wood put in his submissions and in that regard I will refer to the tab numbers and the exhibit numbers as I proceed through that. The second component is a series of arguments about the matter and listening to your earlier remarks in regard to the arguments that don't directly impinge upon the manner in which Mr Wood presented its submissions earlier today, I have prepared an outline which I'll hand up via your Associate, sir.

PN2103

It's very much an outline with the questions I'm posing and the authorities I rely upon. It's more an aide memoir as we go through, so I won't seek to have it marked, sir.

PN2104

THE COMMISSIONER: I'll mark it for convenience, C3, otherwise it'll just get lost and it deserves better than that.

EXHIBIT #C3 SUBMISSIONS OF MR CALVER

PN2105

MR CALVER: Mr Wood said in his submissions that we are dealing with the reality of what happens here. In other words, what we're looking at is the reality of the industry and in saying that he was trying to argue that there had been a fundamental loss of entitlement by employees in the industry. That is not what is at issue. In examining the reality of what has happened in this industry we rely for its probative value, and I note in the transcript that came out from last time, the word probative is changed to prohibitive, wherever it appears, the probative value of this evidence which came out in cross-examination, we say, is high.

PN2106

At PN559 I say to Mr Wood, "You said in your evidence that there's no complaint by any employee of a loss of entitlement." Mr Wood says, "That's right." I go on to ask him, "There's no complaint by any employer about this change to definition." He says, "That's right." In examining a change to the safety net the first question that must be asked, and we say unequivocally, the fundamental question is, is the safety net operating as such and fairly in reality out there where employees are receiving entitlements, and overwhelmingly from the evidence there is no complaint, there is no dispute, there is no loss of entitlement and there is not one shred of evidence that the AWU has adduced in these proceedings that shows otherwise.

PN2107

That is our overwhelming conclusion and one that I will come back to in all of the material that I present to you. Mr Wood went through the tabs in the folder that he handed around, or circulated, and I just want to briefly touch upon some of the matters that he alluded to in relation to each. Tab 1 is of course Mr Winter's witness' statement. Mr Winter's evidence should not be highly regarded. He admits to attending only one meeting. The fact that he attended a meeting is not able to corroborate or substantiate anything other than that the meeting was held. No one can remember dates, no one can remember content. It shows nothing about the merits of the application. It shows nothing of relevance that substantiates anything that is in contention. He was not involved in the award simplification proceedings. I will return when I deal in my outline with the notion of whether or not there's an industrial dispute to more of what Mr Winter says.

PN2108

Tab 2, which is exhibit A3, again, shows nothing about the merits of the application, shows nothing of any relevance. What it does do is articulate that there are methods of payment of redundancy in the building and construction industry which have the effect of having moneys paid by way of redundancy into independent funds. That is all that tab 2 shows and any further matters that were put before the Commission are irrelevant. Mr Wood said that he raised tab 2 because, quote, "All of this infrastructure is in place." Nothing in the TCR test case will have the effect of preventing payment into a fund, nothing in the normal TCR standard as it relates to redundancy will have an effect on that infrastructure and the point is completely irrelevant to the context and the substance of the application.

PN2109

Tab 3 is High Court decision in Coal and Allied. Mr Wood said he relied on tab 3 in the authorities there collected to bring evidence to the Commission or substantiate his argument to the Commission that it didn't have jurisdiction in the first place to change the definition, especially under the award simplification process. How that proposition emanates from tab 3 was not articulated by Mr Wood. Paragraphs 82 and 83, which he took the Commission to, are not relevant where the AWU consents. The whole objective process that the Commission went through does not disclose an error on its part. What it does disclose is an acknowledgement that this was a matter presented to the Commission as a matter of consent.

PN2110

THE COMMISSIONER: Why does consent come into it for item 51?

PN2111

MR CALVER: Because the AWU consented to the variations that were proposed to the Commission, albeit any notion of error that is being applied retrospectively, be put aside. On the face of it this was a matter that related to consent, and where residual - - -

PN2112

THE COMMISSIONER: As I understand the argument, and I might have got it wrong, but item 51, which is the basis for the variation of the WROLA Act, at 51(3):

PN2113

When varying the award under sub-item (2) the Commission may also vary the award so that in relation to an allowable award matter the award is expressed in a way that reasonably represents the entitlements of employees in respect of that matter as provided in the award as in force immediately before the end of the interim period.

PN2114

MR CALVER: Yes.

PN2115

THE COMMISSIONER: Now, there's nowhere else under the - as I understand Mr Wood's argument it was that item 51 does not give the Commission power to vary an award other than in those terms. That is, to remove - other than in the terms of item 51, and by failing to continue the - it's on about 30.2.3.2 of your Act, I mean.

PN2116

MR CALVER: Sorry, I've closed it now.

PN2117

THE COMMISSIONER: At the front, 30.2.3.2.

PN2118

MR CALVER: Yes.

PN2119

THE COMMISSIONER: And that the issue of consent really is beside the point.

PN2120

MR CALVER: We say that when award parties come to the Commission seeking award variations as matters of consent, then the jurisdiction of the Commission is not confined to - - -

PN2121

THE COMMISSIONER: No, but the parties didn't come before the Commission seeking the variation by consent. It was an application by the Commission's own motion under item 51.

PN2122

MR CALVER: But, Commissioner, as I will come to, it's clear that Mr Wood indicated to the Commission that he consented to the terms of the award as varied and it's clear that in the decision that was issued by Senior Deputy President Williams, who's had lengthy discussions between the parties to this award ensued, "An agreed position has now been reached as the contents of a simplified version."

PN2123

THE COMMISSIONER: Yes. No, I understand that - - -

PN2124

MR CALVER: But objectively - yes?

PN2125

THE COMMISSIONER: What I'm saying is, as I understand Mr Wood's submission in relation to this point it is that the Commission, regardless of whether there was consent or not, was limited to what item 51 allows.

PN2126

MR CALVER: Well, I don't believe that to be so.

PN2127

THE COMMISSIONER: In terms of his submission, I'm saying.

PN2128

MR CALVER: Yes - - -

PN2129

THE COMMISSIONER: I'm not saying whether his submission is right or not, I'm just - - -

PN2130

MR CALVER: Well, I am addressing that. In terms of the Commission acting on its own motion in matters of consent, that the Commission has a residual power to act on its own motion to change awards, there's this very jurisdiction that we're in in terms of 113, and there is nothing in the WROLA Act which speaks of it operating distinct from the other powers of the Commission.

PN2131

THE COMMISSIONER: I understand that, but to the extent that it's operating under 51, as I understood the submission of Mr Wood, 51(3), which I read out before, limited the Commission.

PN2132

MR CALVER: Well, I don't believe by its own terms it does. It gives the Commission a capacity and when the Commission is given a capacity, unless it excludes the other rights that are vested in the Commission I would argue that the Commission can exercise all of the powers with which it is invested, including those to act upon its own motion, including those to vary an award, particularly in the context of where the industrial parties come to the Commission and provide their consent to those variations. A matter that is at the very nub of the contention here, because it's the consent matter about the definition of redundancy that brought the AWU to the place where it is now.

PN2133

It consented before Commissioner Palmer to be a party to an agreement that changed, we say, illegitimately now, the definition of redundancy. In the same way that that consent empowers the Commission, it so empowered the Commission in the context of the matter that we are dealing with and the powers of the Commission to vary an award re not restricted by the notion of award simplification. They are expanded to encompass that power and if the Commission has a residual jurisdiction where, by the consent of the parties, all the objective characteristics are such that the award should be changed in line with those consent in mind, we say that's a power that the Commission had the right to exercise.

PN2134

There is nothing in the authorities that Mr Wood has directed you to, Commissioner, that says otherwise. I mean, if I might go on with that point. Senior Deputy President Lacy's decision, which is also behind tab 3, refers to the particular power of the Commission under section 111(1)(f), "The Commission may set aside, revoke or vary an award, order, direction, determination or other decision of the Commission." And can do so based upon consent, an everyday quotidian occurrence in this place.

PN2135

Sorry, am I going too fast, Commissioner?

PN2136

THE COMMISSIONER: No, no.

PN2137

MR CALVER: Sorry, I thought you had another question, I apologise. So, we are categoric in our submissions that there has been no error on the part of the AIRC. The Commission acted on the basis of what was presented to it, clearly, as a consent arrangement. Mr Wood made the point that simplification is not about taking entitlements from workers, but as I said in my opening, there is no evidence that the safety net has had that effect, the change to the safety net has had that effect. Mr Wood admitted to no losses, to no changes.

PN2138

Tab 4, which is exhibit A4, stands as one of the many objective indicators that there was a consent position. Mr Wood admits to the fact that on 21 December he translated the document that is attached to that letter to a consent position before the Commission and we note that in the letter dated 21 December 2001 from the Associate to Senior Deputy President Williams there was a clear indication by the Commission that, quote, "The parties are requested to consider this draft and be in a position at the hearing to advise as to their positions regarding its content."

PN2139

Now, on transcript, which I will take you to in more detail later, there's a clear indication from Mr Wood, and this came out in cross-examination of him by me, that at the subsequent hearing he consented to the document, he acceded to the request contained in the letter dated 21 December 2001. How can he say he did not receive the document, because out of his very own mouth, he objectively consented to its terms? Tab 5, during the award simplification process it was quite common, quite common for test case decisions to be inserted in awards and at tab 5 there is a letter to Senior Deputy President Williams from VECCI dated 15 February 2002 and on the second page of that letter, a letter signed by Mr Phil Eberhard. There is clear indication that as part of the award simplification proceedings parental leave were extended to eligible casual employees and that extension, to my understanding, was undertaken to ensure that awards in respect of parental leave, accorded with test case decisions.

PN2140

So it is not a matter of great moment that the definition of redundancy was brought into line with a test case decision. What that does is insert the community standard by consent on its face into the AWU award. Tab 6, exhibit A6, on page 2 of the letter which Mr Wood noted was undated but he indicates should have been dated 22 October 2004, there is a clear indication of how this application emanated. The paragraph, the second paragraph under 17.10 as there indicated, is very important. As it turned out the CFMEU - - -

PN2141

THE COMMISSIONER: I'm sorry, I'm not with you. Whereabouts are you?

PN2142

MR CALVER: I'm sorry, I'm at tab 6 - - -

PN2143

THE COMMISSIONER: Exhibit A8?

PN2144

MR CALVER: A6, I have it marked here.

PN2145

THE COMMISSIONER: A6, sorry, that's where I was. Yes, now I've got it.

PN2146

MR CALVER: Yes, now tab 6, A6, page 2, the second paragraph under 17.10.

PN2147

THE COMMISSIONER: Yes.

PN2148

MR CALVER: Mr Wood says, "As it turns out the CFMEU and the CEPU were in the Commission at the time" - that is, the time that he bought forward an application to continue the community standard test case provisions for TCR -

PN2149

and saw the listing and went to the court and requested a private meeting with me about the application. Both unions raised some concerns so the AWU agreed to seek an adjournment so that the unions in the construction industry could meet at the ACTU to hear all points of view.

PN2150

It was from that meeting that there was an indication the first time that in the mind of the AWU there had been a mistake, an error, which I'll go into in some more detail - - -

PN2151

THE COMMISSIONER: Are you talking about the private meeting - - -

PN2152

MR CALVER: The private meeting, yes.

PN2153

THE COMMISSIONER: Yes, I wasn't clear.

PN2154

MR CALVER: It's absolutely clear - - -

PN2155

THE COMMISSIONER: Because it's another one of those ambiguous paragraphs, yes.

PN2156

MR CALVER: Yes, absolutely, but it was absolutely clear that, from the evidence it seems that it was that meeting which triggered the application currently before you. I now move to, if I may, Commissioner, tab 10 which is the award simplification decision relevant extracts, print P7500. Now, there is no prescription against removal of existing rights and protections indicated, but instead a proposition that existing rights and protections should not lightly be set aside.

PN2157

We agree with that proposition, but I reiterate that the process of infusing a community standard definition has not - has not - by the AWUs very evidence, shown a lessening of rights and protections in practice. They shouldn't be lightly set aside, they were not lightly set aside. The community standard was inserted by way of consent. Objective evidence was one of consent. All of Mr Wood's propositions are irrelevant in the face of the objective elements about consent, and about the Commission's categoric jurisdiction to act upon that communication of consent.

PN2158

In addition, the second page of the summary, page 32, dot point 2, award simplification provides minimum entitlements for employees in relation to allowable award matters and these are the words I with to emphasise - "consistent with its safety net character." It's quite clear that the TCR standard existence award has the character of a safety net standard. It is the TCR standard. It is quite common for test case standards to be inserted in awards of simplification because they are consistent with the safety net character of the function that the Commission fulfils under the Workplace Relations Act and this is a distinction to which I will return because some of the notions that are before you arose out of a different grundnorm, for a pompous word, Commissioner, a different basis from which to proceed, and that was where awards had a different function and comity, comparative wage justice and the elements of bringing consistent wage increases to each award were at the fundament of awards and that is how this outdated notion of the family of construction awards arose, from a different error than one which is concerned with maintaining a safety net.

PN2159

So the notion of the family construction awards as mentioned at tab 14 was about matters that were then important which have much less importance in the current manner in which the Workplace Relations Act examines the notion of awards and a function that the Commission has vis-à-vis awards. In respect of tab 19 I don't think the relevant - - -

PN2160

THE COMMISSIONER: Sorry. As recently as 22 February 2001 in the decision of Senior Deputy President Watson which is at tab 15, he refers to the family of Building and Construction Industry Awards in the first paragraph.

PN2161

MR CALVER: Yes, but that, with respect, is a misnomer given that it is merely a way to describe them rather than looking beneath the surface as to why they're a family, to the origins of that term and what it means in - - -

PN2162

THE COMMISSIONER: Well, whatever, he went on in February 2001 to vary the AWU award in a manner that bought it into line with the other awards to the extent that there's been a change in approach, it must have been since then.

PN2163

MR CALVER: In relation to classification structures.

PN2164

THE COMMISSIONER: Yes, certainly.

PN2165

MR CALVER: Yes, and that is an issue where there is considerably more cogency in having similar classifications than other elements, and I say that without conceding that the notion of a family of construction awards currently has relevance. However, when you have Australian qualification framework levels and recognition of skills and trades that can be applied in relation to obviously the complexion of Building and Construction Industry work, it is useful to have that articulated into awards in a manner that is consistent. So to that extent, although we weren't served with notification of the - in time - of the matter of the change in classification structure that was recently before Commissioner Harrison, that does make more sense.

PN2166

In that way we can say that there is some level of comity that is maintained. However, later on in my remarks I will take you to some of the points of difference between the National Building and Construction Industry Award that are in existence and show why those points are relevant for distinguishing between the AWU award, the subject of these proceedings, and the National Building and Construction Industry Award. There is some proper use of the notion of classification structures being similar when those classification structures reflect the sorts of qualifications that apply in the building and construction industry, but at a deeper industrial level we say that notion of a family of awards should be discarded because of the safety net setting function of the Commission.

PN2167

Now, Commissioner, if I can leave the potpourri of accumulated material that the AWU put into this matter and turn to the submissions which I wish to make out in the order set out in the outline before you that is C3. I start with the notion of, is there an industrial dispute? And obviously this is a matter that is before you under section 113 of the Act. It provides a wide discretion to the Commission. It does so, however, on the basis that there is an industrial dispute in existence. That is reinforced by the terms of subsection 4 of section 113, and I won't take you to that and read it out, I'm sure it's well known to you.

PN2168

It was Mr Wood's evidence that the lodgement of the application and the relief sought from the Commission was not sparked by any complaints to the union, by any employer or employee from any on-ground disputes. Paragraph numbers 559 to 561 of the transcript in particular highlight that point. It was Mr Winter's evidence that whilst in his opinion there was potential for the difference between the definition of redundancy appearing in the National Building and Construction Industry Award and the award, the subject of these proceedings, to engender disputes, and I note particular paragraph 8 of his statement, Commissioner, he could not point to any disputes that were in existence or had occurred. He said there was potential but there was not one jot of evidence, and I point out paragraph number 645 and following in particular in that regard.

PN2169

The change to the definition in the award has therefore been unremarkable where it counts. It's unremarkable in reality. There is not one shred of evidence before the Commission which supports an argument that the purported loss of entitlements has had any practical effect. It has not caused any on-ground disputes.

PN2170

THE COMMISSIONER: Sorry. I don't understand the relevance of this line of argument. It may be that I'm paying too much attention to exhibit C3, but are you saying there's a requirement before an award can be varied for there to be an industrial dispute?

PN2171

MR CALVER: Yes, and I'm coming to that - - -

PN2172

THE COMMISSIONER: I'd say that 113(4) says quite the opposite.

PN2173

MR CALVER: Well, Commissioner, I'll jump straight to P9213 then.

PN2174

THE COMMISSIONER: Yes.

PN2175

MR CALVER: If I can take you to page 16 of 24.

PN2176

THE COMMISSIONER: Sorry, it's - - -

PN2177

MR CALVER: Page 16 of 24?

PN2178

THE COMMISSIONER: Where do I find the - - -

PN2179

MR CALVER: That was the case that was handed up yesterday by the Gordonstone case.

PN2180

THE COMMISSIONER: Can you give me a reference to it?

PN2181

MR CALVER: Sorry, P9213, the one that contained a paragraph about allowability that you had an exchange with Mr Stevenson about.

PN2182

THE COMMISSIONER: Gordonstone.

PN2183

MR CALVER: Gordonstone, yes, sir.

PN2184

THE COMMISSIONER: Bear with me. Yes?

PN2185

MR CALVER: If I can please take you to page 16 of 24 in the copy handed up and if I can take you to the second paragraph, the indented paragraph, may I read, Commissioner, are you with me? "On the basis of that review of authorities", and the Full Bench extensively analyse the history of section 113:

PN2186

We do not doubt that it is open to the Commission to vary an award to remove portions of it that may be considered...(reads)...arbitration or a maintaining of a settlement of an industrial dispute by varying an award or order.

PN2187

THE COMMISSIONER: Yes, but isn't the industrial dispute that which was notified to the Commission in C25068 of 1989?

PN2188

MR CALVER: Well, I say that the relevance of whether or not there's an industrial dispute is important for two reasons. One, to show the effect of the making of a safety net, and two, to determine that the only manner in which the Commission is empowered to exercise jurisdiction is to grant the relief of the original log is able to countenance the amendment. Now ex facie, Commissioner, I agree with you. But it appears plain, because of its prior existence in the award. However that's not conceded and it's a matter that the AWU should offer material by which to satisfy the Commission, especially if Mr Stevenson's arguments about a lack of allowability means it's accepted by the Commission, the Commission has no jurisdiction, but I'm not instructed to offer an argument on the point of allowability.

PN2189

THE COMMISSIONER: No, I understand. But what you're saying is that - so you're challenging the jurisdiction right back and saying that there's insufficient ambit within the original log?

PN2190

MR CALVER: I'm saying in the absence of an on-ground dispute, that is the only shelter that the AWU has, yes.

PN2191

THE COMMISSIONER: Yes, yes, but that's as I - I mean, if that's all you're saying by - - -

PN2192

MR CALVER: That's what I am principally saying, yes.

PN2193

THE COMMISSIONER: So when you're talking about - I'm not sure that 113(4) is critically the point, because that seems to me to be - 113(4) in its word is saying that the application shall be treated as if it were the notification of a dispute.

PN2194

MR CALVER: Yes.

PN2195

THE COMMISSIONER: The need for the dispute really comes from the jurisdiction of the Commission and in particular the requirement of section 101, I think.

PN2196

MR CALVER: Yes, I agree. However I think that my interpretation of 113(4) is that it says in a roundabout way that not only does a 113 application have to be treated as if it were a notification of industrial dispute, in the light of Gordonstone there has to be an industrial dispute.

PN2197

THE COMMISSIONER: Yes, well, I think there has to be an industrial dispute anyhow. We can't vary an award.

PN2198

MR CALVER: Indeed.

PN2199

THE COMMISSIONER: It's implicit, isn't it, that so long as there's ambit within the - I mean, I think all that Gordonstone is saying is that you can only vary an award, with respect to the Bench, you can only vary an award within ambit of the original dispute.

PN2200

MR CALVER: That's one of the constraining factors, yes, Commissioner, yes.

PN2201

THE COMMISSIONER: Yes, I think that's what they're saying in that extract that you referred to.

PN2202

MR CALVER: Yes, and what I'm saying is that without evidence of - - -

PN2203

THE COMMISSIONER: Sorry, I need to go one step further.

PN2204

MR CALVER: Yes, of course.

PN2205

THE COMMISSIONER: Subject to 89A.

PN2206

MR CALVER: Subject to 89A, which is the point I'm saying, subject - but the other point I'm trying to make is that in reality, if there is no industrial dispute on the ground, if there is nothing other than a meeting with unions about the competitive effect of this provision on the AWUs membership, then the safety net need not be adjusted because in reality there is no one out there who is in practice affected by the change which has been in place for over two years, and that is, as I've said in my opening remarks, that is a thread that I'd like to take you back to, the black thread in the cloth, if you like, of a weaver that is required for all other arguments to hang off.

PN2207

The ACTU has conceded that there is not one complaint by an employer or an employee, that there is not one dispute about loss of entitlements that the whole industry proceeds as if the safety net effect was operating as it should do, as an appropriate safety net and that's why I've reinforced right from the beginning the notion of industrial dispute, but also to bring into issue those jurisdictional points. And also to reinforce that there has been no error on the part of the Commission. The Commission has acted entirely properly.

PN2208

That leads us into the second component of my submissions represented by the question: what are the merits of this application, ane the first issue is the argument about error which has taken up an inordinate amount of the Commission's time. The principle contention of the AWU in my conception is that Mr Wood made an error in permitting a change in the provisions of the award relating to redundancy in the process of simplifying the award. Assertions to this effect have been made by Mr Wood in the face of considerable objective evidence that no mistake was made, especially not in the legal sense.

PN2209

The evidence is also that the consent to the change followed a pattern of conduct in that the AWU had already consented to a similar change in the West Australian and South Australian awards covering similar work, no matter the intricacies of how that occurred. The evidence is clear that that was the end result. Trade-off or not, that was the end result. The law is wary of permitting parties to contracts to rely upon subjective notions of error as a basis for altering those contracts.

PN2210

A unilateral mistake is an incorrect belief held by one party that is not shared by the other party or parties. Here if an error has been made it is absolutely consonant with the idea of unilateral mistake. It is clear that objectively Senior Deputy President Williams, in his decision relating to the simplification of the award, paragraph 2 of PR917652 dated 10 May 2002 said - and I have a copy of that decision, Commissioner - - -

PN2211

THE COMMISSIONER: I've got the file, it's okay.

PN2212

MR CALVER: It's relatively short, but if it will help, "Lengthy discussions between the parties to this award ensued." An agreed position has not been reached as to the contents of a simplified version. That is the objective position. It follows a clear indication by his Honour in paragraph 1 of the decision before you that it follows on from the NBCIA award being simplified. That is the objective position. Indeed, during cross-examination I put to Mr Wood that there was no evidence that an error had been made and Mr Wood, at PN536 to PN539, during cross-examination admitted to the fact that he said to the Commission on 28 November 2001 that the parties had reached an agreement.

PN2213

Out of his own mouth the objective evidence was that the Commission could proceed to exercise its jurisdiction based upon the parties bringing consenting minds to the Commission. The subjective position though, the subjective position, and I emphasise that word, on the face of it "discovered", in quote marks, nearly two and a half years later is expressed as an error by the AWU. But does not and cannot have that objective characteristic.

PN2214

So, Commissioner, before you is a matter of some difficulty in the sense, because it squarely raised the issue of the extent an organisation is capable of alleging an error in the simplification process, or whatever process, before this Commission, one that is not reflected in the objective evidence available or upon the objective basis that the Commission acted and the extent to which, if at all, the Commission will permit a party to so rely on an error characterised in this way to obtain a variation to an award.

PN2215

Now it flows from our objection to the notion that the Commission should be moved by these objective considerations that we submit that the Commission should not permit the AWU to obtain a variation of the award on that basis. Here the notions of equity and the Commission acting - on the basis of equity and good conscience in the industrial sense become linked to the contract law notions of considerations of equity.

PN2216

Now, I have, Commissioner, as indicated in the outline, photocopied page 923 of the text recognised as the most authoritative in the Law of Contract, that is Greig and Davis, and the learned writers note that:

PN2217

At equity it is only where one party knows or ought to be aware of the other's mistake that a contract may be set aside. This proposition derives from the notion that it is unconscionable to allow a party with knowledge of a mistake to take advantage of the contract to which he knows the other has not brought a consent in mind.

PN2218

Essentially whilst in contract law the elements of an unconscionable transaction can never be exhaustively defined, they devolve to one party taking unconscientious advantage of the other with knowledge of the disadvantage of the other party. Whilst there are obviously different considerations to apply when examining the actions of representative organisations, any argument based upon unconscionability or the taking advantage by employer parties should be rejected.

PN2219

Mr Wood appeared to be making an allegation at paragraph number 50 of the transcript from 7 April to the effect that employers had acted unconscionably. Mr Wood there alleged that they, that is the employers, even fabricated a position to say that we actually asked for this. Originally we had believed that his argument would flow from the notion that the AWU or its members had been treated unconscionably. However, under cross-examination he could not substantiate this point or provide evidence to the Commission which revealed any element whatsoever of lying on the part of employer representatives or that employers somehow took advantage of a mistake made by the AWU.

PN2220

This is reinforced by his evidence that he was aware of the outcome that the National Building and Construction Industry Award had occurred but that the document where he sought to check that was not a reflection of the action that he took. In other words, even though he noted that he needed to check the National Building and Construction Industry Award, he said that he didn't take that step.

PN2221

The evidence of the CCF witnesses was that it was their intention all along that the true definition of redundancy should be used in a simplified award, and that that's their policy, no matter what the deconstruction of events shows, it's clear that the CCF all along wanted that position. They haven't sought to hide that, they haven't sought to take advantage of the error now said to be revealed. No subterfuge or lies were used in the process of simplifying the award in order to take advantage of the other party, no one acted unconscionably. And here it is the first argument that you and I discussed, Commissioner, relating to the lack of any on-ground disputes over the issue folds into this second argument.

PN2222

Mr Wood, from the outset, has indicated that his members are not worse off from the change that was made to introduce a proper definition of redundancy into the safety net. At paragraph number 53, lines 6 to 7, Mr Wood stated, "Might I point out not one member of ours has not been paid redundancy despite what the award says." So the members at equity have not suffered. There is no need to set aside the error of the representative to say that the employees, the workers in the industry have been harmed because Mr Wood's very evidence is that they have not been so harmed. Mr Winter had no evidence of any detriment suffered by an AWU member and I reiterate no evidence of any dispute about redundancy under the award.

PN2223

Where does prejudice lie then? Well, as has been clear from exchanges between yourself and Mr Stevenson, this award is now a Common Rule award. Ergo, there would be a very real prejudice to employers who are subject to this award in Victoria, given that there will be a massive increase in the minimum safety net applying in that state without any concomitant productivity improvement. The number of employers affected has been at issue. Well, so far as Master Builders is concerned, the potential number of employers affected is more than the current members of Master Builders Association of Victoria.

PN2224

The figures from Master Builders Victoria show that it has 1350 commercial members, and commercial members are capable in large part of participating in matters that can be construed as civil as well as other non-residential matters, and the Building Commission of Victoria statistics show that in the general sector, further 2822 licences have been issued to builders in that sector. So there is a potential if there is a change to the safety net in equity to have those employers suffer.

PN2225

I'll now move on to the argument about comity.

PN2226

THE COMMISSIONER: Just before you do. The knowledge by the employer parties, and particularly the CCF, can be constructive knowledge of the mistake and what I would see as an argument about that, and it's far from deciding that, is that they have on the evidence negotiated a different form of - well, the form of - definition of redundancy previously with the AWU in circumstances where they had to trade. They knew the AWUs position on that and yet along comes this on this occasion, it falls into their laps.

PN2227

MR CALVER: That's one way of putting it, sir, yes.

PN2228

THE COMMISSIONER: Well, there's consent and they didn't have to trade anything. Wouldn't that be the basis arguably for constructive knowledge of the AWUs mistake and in those circumstances then we've got the basis for equitable leave lies in the unmistaken party failing to apprise the other party of his error, and seeking to take advantage of a contract to which he knows or ought fairly to know the other has not bought a consenting mind?

PN2229

MR CALVER: Yes.

PN2230

THE COMMISSIONER: It seems to me that that argument, you know, meets those tests.

PN2231

MR CALVER: That is an argument based upon the proposition that the CCF or another employer party ought to have known, ought to have known there's - - -

PN2232

THE COMMISSIONER: The reason why I say they ought to have known there's a mistake is that in their previous dealings with the AWU they knew the AWU was not going to agree to any change unless it got a pay-off.

PN2233

MR CALVER: My manner of approaching the argument in that regard is to first agree with your postulation that there is a duty at equity, if you ought to have known that the other had made a mistake. That is in circumstances reflected in the cases, like Amadio, where there is a clear disadvantage reflected in the party with whom you are dealing. So in Amadio's case, for example, it was a little old lady who was taken advantage of in respect of - - -

PN2234

THE COMMISSIONER: Yes, I know Amadio's case.

PN2235

MR CALVER: I'm reminding myself as I go along, sir, of frailty and I think an element of - - -

PN2236

THE COMMISSIONER: A major point of English, wasn't it?

PN2237

MR CALVER: English as well, that's right, yes. So in these circumstances the question that you're raising is, ought the employers to have known that the AWU made a mistake? Now, that is a matter that I say there is no connection with those prior negotiations and the consent position that objectively was reached and I think that that is one of the bases upon which I'm underlining the practical fit of the change to the safety net. There is no detriment about which there is evidence. So there is no disadvantage that has been incurred that the employers have unconscionably relied upon.

PN2238

THE COMMISSIONER: Well, that works both ways, doesn't it?

PN2239

MR CALVER: It does, it works both ways.

PN2240

THE COMMISSIONER: If there's no disadvantage - I mean, if there is no disadvantage, what's the problem with varying the award?

PN2241

MR CALVER: There is no disadvantage - - -

PN2242

THE COMMISSIONER: I mean - - -

PN2243

MR CALVER: There is no disadvantage in respect of those who are subject to the award in the formal sense but there would be substantial disadvantage in those who have recently become respondent to the award through the extension of Common Rule and that - - -

PN2244

THE COMMISSIONER: Right, but that, as you will recall, did raise with Mr Stevenson the possibility of any variation being limited in Victoria to the named respondents.

PN2245

MR CALVER: Well, we would be prima facie opposed to that because the adverse effects it would have on our membership, and it would have a very large effect on membership of employer organisations because why would you belong to an employer organisation when you know you were going to cop a higher standard if you were currently a Common Rule respondent where you were paying the community standard, whereas if you moved to join the Master Builders' Association of Victoria for example you would have to pay a higher standard, and I think that the differentiation that we're discussing is one that - - -

PN2246

THE COMMISSIONER: Does the Commission have any responsibility these days for encouraging membership of organisations?

PN2247

MR CALVER: No, it doesn't. It has no jurisdiction to encourage unions or it has no jurisdiction to encourage employer associations, however - - -

PN2248

THE COMMISSIONER: It used to have, but it doesn't have it any more, and so it's not a relevant criteria.

PN2249

MR CALVER: No. It's one of the many considerations that used to be brought to bear in the family of construction awards that no longer applies. However, at equity I think we have a problem there that the Commission would be handing down a decision which oppressed one party in the face of evidence that, at the moment, if you leave the award as it stands, no one would be worse off. Whereas you would be taking a positive step to make a definable class of people, that is, members of employer associations palpably worse off. So by not acting to change the award, you would not be creating any unfairness, but by acting to change the award you would be potentially prejudicing those who are members of registered organisations.

PN2250

So in that sense the greater fairness comes from not altering the award because of those two factors. That is, if you do act, there you are engendering an element of unfairness in those who are members of employer association, and by not acting you are recognising that the evidence in all practicality is that people are going to be continued to be paid their entitlements as they were in the past.

PN2251

THE COMMISSIONER: Well, I thought you were saying that the variation to the award would have no impact.

PN2252

MR CALVER: I wouldn't concede that, Commissioner, no. What I said was that the current insertion of the safety net standard has maintained the safety net function of the award and that is one of the reasons that there has been no complaints about loss of entitlement because of the other functions that - the other functioning of the market place with enterprise bargaining and the whole notion of the award merely acting as a safety net operating clearly. The fact that the safety net is operating in a way which doesn't currently create unfairness means it shouldn't be changed. I don't think I was conceding completely the point that you've just put quite plainly to me.

PN2253

THE COMMISSIONER: So you say the reason there's no complaint is because, not because people haven't suffered, but because the provision is sufficient to stop people complaining?

PN2254

MR CALVER: No, I don't think there's any evidence as to that proposition either. What I'm saying is that the award safety net is working in that there are other mechanisms by which workers' entitlements are being paid in the same manner they have been paid for many years, and that is through enterprise bargaining. The building and construction industry has, as you well know, Commissioner, got a very much larger element of enterprise bargaining than other sectors, albeit that a number of those are patent agreements, and that the safety net is operating and the other enterprise bargaining mechanisms are delivering to workers their entitlements which is how the Act envisages industrial relations should be conducted. I trust that assists, Commissioner.

PN2255

So I move on to the argument about comity. The AWU argues that there should be comity, particularly between the National Building and Construction Industry Award and the AWU Construction and Maintenance Award. The argument is that the two awards in particular should have the same provisions regarding redundancy. Mr Wood's error was, he has stated in evidence, that he did not check the provisions of the National Building and Construction Industry Award before he agreed to the form of the award, the subject of these proceedings.

PN2256

This was despite the fact that he was aware, and this is in cross-examination, that the NBCIA, in shorthand, was made effective from 6 June 2000 and the AWU Construction and Maintenance Award was made with effect from 10 May 2002. At the least it was open for him to make the checks that he said were required from his reading of exhibit A4. The award simplification unit's summary of the changes intended as a result of the simplification to be made to the AWU award.

PN2257

A test case standard was inserted at the time of the award simplification process. This Commission has made it plain that test case standards should apply, especially regarding redundancy, and I give you as a halcyon example of that statement a proposition by Justice Boulton - I've got far too many copies of the decision, excuse me - Justice Boulton which I have just handed to your Associate, where at paragraph 28, Commissioner, he says, "In general it would only be in an unusual case that an award would be made in excess of the general standard of redundancy pay."

PN2258

In regard to the matter that was then before him he noted that such a case was made out and that level of argument simply hasn't been made in this case. There have been no arguments of merit to show why the award safety net should be increased in excess of the general test case standard. No arguments of merit beyond the notion of error. We say there is a heavy onus to show how a payment in excess of the general standard of redundancy pay will render a safety net that properly complies with statutory requirements. Here I move from PR904332 to section 88B(ii)(a) mentioned in my outline.

PN2259

That section requires that the Commission set redundancy pay and terms and conditions relating to redundancy at a level which provides a fair minimum standard in the context of standards prevailing in the community generally. That is why the TCR standard should not be modified. The union has alluded to the fact that, "Having different standards would create the potential for industrial unrest", potential being underlined, "arising from employees with different employment arrangements working side by side." But there is not one shred of evidence relating to this potential leading to any complaints to the union, let alone to disputes. That potential - - -

PN2260

THE COMMISSIONER: Which can't occur anyhow.

PN2261

MR CALVER: That potential, as I'm about to say, Commissioner - absolutely - that potential does seem to be one that is merely a figment of the union's imagination particularly in light of the discussion about legal requirements that occurred earlier in the Commission today. We believe that Commissioner Lewin properly expressed the manner in which the Commission should approach issues relating to the variation of awards in a case that really is a matter where he stated it by obiter dicta, but I think that he has summed up the function of the Commission fairly well. I'll just hand up that decision.

PN2262

If I can take you to paragraph 28, it seems to be the lucky number today:

PN2263

Where there is no agreement on what constitutes an established test case standard an application for a variation of an award in relation to a term and condition of employment must be determined on the merits of the particular case.

PN2264

So a quite simple, straightforward proposition. We've dealt with that aspect of the jurisdiction of the Commission which relates to equity and conscience and now underlined by Commissioner Lewin's summary of what the Commission must do. The substantial merits of the case, is the next component. It's a case that has no relevance and substance to the matter before you. Generally the test case standard, in this instance represented in PR032004 and PR062004 read together, reflects the community standard, and for completeness, I know that those are fairly well known to the Commission, but in particular I'll hand up PR032004 because I'll take you to an extract in that later.

PN2265

I'm also quoting from the principle test case standard, but I'm sorry, I don't know that I have - no, I've actually extracted the same paragraph from the principle test case standard that was referred to you this morning by the AIG, that is paragraph 30, purely coincidence. The Full Bench in the redundancy case supplementary decision PR062004 - I do have it, I do apologise, here it is here, sorry. Yes. If I can take you to paragraph 30, it underlines what AIG said this morning and we support their submissions in that regard:

PN2266

We agree with the proposal jointly put forward that we should publish model termination and redundancy clauses ...(reads)... generally in line with the requirement in section 88B that is manifestly placed upon the Commission.

PN2267

I'll now move to argument 2C in my outline, Commissioner, under the heading, "The argument about a separate building industry redundancy standard". Clearly the AWU bears the onus in showing that a separate building and construction industry standard exists and that it needs to be maintained, especially in the light of the recent TCR test case decisions. We do not believe that the AWU has gone anywhere near in discharging that onus. The AWU has at tab 12 of its submissions provided the Commission and the parties with a copy of print K2799. That decision is instructive. It indicates that the so-called building industry TCR test case was never proceeded with and never achieved the status that its name suggests.

PN2268

The Full Bench decision recognises that the current definition of redundancy was formulated as a result of a consent agreement between the parties, rather than from the required examination of the merits of the matter. The Full Bench decision that was quashed by the High Court in that the High Court did not permit orders to issue, is clear in having a different definition of redundancy to the one reached by consent. In print H7465 appearing at tab 11 of the AWUs folder of materials, the definition of redundancy is shown to mean something different. It is shown to mean, "A situation where an employee ceases to be employed for any reason," these are the critical words, "and the employee elects to no longer seek work in the industry."

PN2269

The employee elects to no longer seek work in the industry. This was a recognition that an employee is not ...(reads)... that was invented by the Full Bench but quashed by the High Court.

PN2270

Redundancy has been clearly defined in the appendix to the supplementary TCR decision which I handed to you, Commissioner, PR062004. Clause R1.2 of the appendix which sets out the clauses that were derived from the two tests cases is in the appendix to the decision and I'll just read it because it's important as the community standard:

PN2271

Redundancy occurs when an employer has made a definite decision that the employer no longer wishes the job the employee has been doing done by anyone and that decision leads to the termination of employment of the employee except where this is due to the ordinary and customary turnover of labour.

PN2272

There is no standard that applies in the building and construction industry that has been the subject of the sort of scrutiny that was recently applied in deriving that definition, or in deriving the entire TCR standard, and that is the standard from which divergence must be argued on their substantial merits.

PN2273

Mr Stevenson has already provided argument that the current definition in the NBCIA is not in fact a definition of redundancy and my discussion underlines that point. If there is a family of awards, Master Builders wants a divorce. The notion of a family of awards came out of the issue of comparative wage justice - - -

PN2274

THE COMMISSIONER: I hope they don't want a divorce from the patent bargaining that's going on.

PN2275

MR CALVER: Sorry, it was a bit of an excitable image at 20 to four in the afternoon, Commissioner. That notion arose out of issues of comparative wage justice, not one of properly setting the safety net having regard to prevailing community standards. In addition, the definition of redundancy reached on a consent basis that prevails in some but not all construction industry awards can be examined in the light of a major difference between the NBCIA and the AWU Construction and Maintenance Award.

PN2276

Now, I must make it plain that this argument is in the alternative. That is, we do not concede that this argument should subsume the prior argument. We say, as an alternative, that there is a fundamental difference in regard to job security that is linked in large part to the concept of daily hire engagement and the NBCIA. I reiterate, this is clearly in the alternative and is not meant to subsume our principle argument. First, the majority of employees engaged under the National Building and Construction Industry Award are tradespersons and labourers who are defined as daily hire workers. Clause 13.2 of the NBCIA states that such employees are entitled to one day's notice of termination of employment or one day in lieu.

PN2277

Under the Act such employees are excluded by section 170CBA(7)(b)(i) from being able to seek relief in regard to non-payment of notice, per section 170CM. Clause 18.3.1 of the National Building and Construction Industry Award also entitles such employees to follow the job loading. The calculation of the hourly rate takes into account a factor of eight days in respect of the incidence of the loss of wages for periods of unemployment between jobs and are still recognised. The redundancy entitlement under the NBCIA or quasi-redundancy entitlement should therefore be understood in the context that the majority of employees as tradespersons and labourers are involved in an industry which has been labelled as transient and their employment so labelled.

PN2278

That is recognised in the NBCIA by the notice requirement of one day and that in consideration of this lack of job security, the employees receive an additional loading on their hourly rate to follow their job loading, which I've just mentioned, and a generously defined redundancy entitlement, too generous in fact by community standards and a matter not to be replicated in this award. In stark contrast to that position just outlined, the award currently before you does not have a daily hire worker classification.

PN2279

Under clause 16 of the current award all employees other than casuals are entitled to standard notice provisions. Such employees have full access to relief in regard to non-payment of notice of termination of employment pursuant to section 170CM as there is no exclusion to such employees under the prior mentioned section, which I love to recite, section 170CBA(7)(b)(i). Further, there is no equivalent to the NBCIA to follow the job loading. The assumption can therefore be made on that basis that employees do not suffer from the same lack of job security and there was some indication in the evidence of the CCF witnesses to that effect.

PN2280

The suggestion that the redundancy provision is set out in the NBCIA should be adopted, and the award currently before you fails to recognise the large distinction between the awards based upon the notion of daily hire. One way in historical terms of justifying the manner in which redundancy is currently defined, reiterating entirely that this is an alternative argument, is based upon the notion of daily hire. It appears that the AWU wants to have their cake and eat it too. They want the redundancy provision of the NBCIA rather than the definition used in TCR. Whilst at the same time having the job security of a TCR based standard with regard to notice of termination requirements rather than the one day notice requirement under the NBCIA.

PN2281

THE COMMISSIONER: Another way of putting it is that they want NECA too.

PN2282

MR CALVER: The circumstances surrounding the insertion of the definition of redundancy in the National Electrical Contractors Award is a matter about which I have no instructions, I'm afraid, Commissioner.

PN2283

THE COMMISSIONER: No, but the point I'm making is that that award has weekly hire and has the same provisions as the Building and Construction Industry Award.

PN2284

MR CALVER: Yes, and thereby making a case for a need for that award to be varied as well, to better account for prevailing community standards, if it please the Commission. The line of argument - - -

PN2285

THE COMMISSIONER: But your organisation is not a party to that award?

PN2286

MR CALVER: No.

PN2287

THE COMMISSIONER: That's why you haven't made that application?

PN2288

MR CALVER: I act on instructions, Commissioner. I have no idea what my next instruction will be.

PN2289

THE COMMISSIONER: No, but if you're not party to the award you can hardly make the application.

PN2290

MR CALVER: No, Commissioner. The line of argument just adopted also reveals that there is no comity in the manner of engagement under the awards sufficient to justify comity on the question before the Commission. If the argument that comity is still a matter that is required to be considered has any justification thereby demonstrating that there is no consonance or comity in a very peculiar part of these two awards which is at the nub of the matter currently before you.

PN2291

Conclusion: there is insufficient evidence before the Commission to justify the extent of departure from the TCR standard sought by the AWU. During the course of proceedings we put it to Mr Wood that the manner in which to characterise his evidence was that following a meeting with other unions he believed that the AWU was suffering a competitive disadvantage and would continue to do so if he applied for the flow-on of the new TCR standard to the award. Hence he pulled up stumps in that application and thought he'd made a mistake based upon his incompetence in checking a matter some two and a half years ago.

PN2292

He realised that a result he would have liked to occur retrospectively should be applied for under the general label of a mistake or error on his part. PN545 shows he admits that the fact that the CFMEU members have a greater entitlement is at issue for him. This unilateral mistake, this mistake in the mind of one party should not be sufficient to found an award variation, particularly as, as I said in my opening remarks, Mr Wood's own evidence, that there is not one dispute or loss of entitlement said to be flowing from the maintenance of the current safety net provision, not one jot of the evidence to reinforce that on the ground people care about this issue.

PN2293

Finally, there does not appear to be a mention of retrospectivity, albeit that that would have been a concomitant of the initial application for a correction order. I mention that section 146 subsection 2 requires extraordinary circumstances to be shown to summarise the section before retrospectivity can be granted. Section 146 subsection 2 says that there must be exceptional circumstances before retrospectivity can apply in relation to the commencement of an award and an award variation. We would suggest in the strongest possible terms that there is no justification for the principle application, let alone any notion that this matter should apply retrospectively and the evidence before you has not shown any need for this award to be varied, let alone varied retrospectively.

PN2294

Unless there are any questions, Commissioner, those are my submissions.

PN2295

THE COMMISSIONER: One question, Mr Calver, which arises from I think a misunderstanding of mine, but in dealing with the argument about error you referred to the requirement of the Commission to act in equity, good conscience and the substantial merits of the case.

PN2296

MR CALVER: Yes, sir.

PN2297

THE COMMISSIONER: And then moved to a discussion about equitable remedies. You're not suggesting, are you, that the reference to equity in the Act is a reference to the law of equity, are you?

PN2298

MR CALVER: No. What I'm referring to, Commissioner, is that the essence of both characterisations of the law is the notion of fairness and we fully concede that that notion of fairness is one that vests you with a remarkable discretion to consider all of the circumstances and the merits of the argument and make a decision based upon this.

PN2299

THE COMMISSIONER: Yes, I anticipated that was going to be your answer, but I just needed to check because of that.

PN2300

MR CALVER: Yes, but I do believe that the law in regard to unilateral mistake in the law of contract, where Australia has gone considerably further than the Common Law of England to have a unique jurisdiction, and particularly the ability to use estoppel as a sword for example, I think that the notions that have developed around those doctrines of equity, the extension of the law based upon the notion that people should not be permitted to act unconscientiously is highly consonant with the sort of considerations that traditionally this Commission has brought to bear and I think that the two arguments are - - -

PN2301

THE COMMISSIONER: Yes, I understand that position. I mean, the Commission can clearly inform itself about the notions of the equitable jurisdiction.

PN2302

MR CALVER: Yes.

PN2303

THE COMMISSIONER: But it's not the same.

PN2304

MR CALVER: No.

PN2305

THE COMMISSIONER: There was no suggestion in your submission that they were the same.

PN2306

MR CALVER: They're not sui generis, to use the legal term. However there is a large element of consonance.

PN2307

THE COMMISSIONER: Yes. No, I understand that part of it. I just needed to clear it up.

PN2308

MR CALVER: Thank you.

PN2309

THE COMMISSIONER: These proceedings are adjourned to a date to be fixed. The parties are aware of the direction I issued earlier, however, I don't think I - I think I need to discuss with you off the record what sort of time limit you should have if you have a need to address the matter, so could we just go off the record for a moment.

<OFF THE RECORD

PN2310

THE COMMISSIONER: In this matter it will be recalled that Mr Wood is to make a reply in writing seven days after he receives the transcript in these proceedings. The employers have agreed off the record, and I think they're in a position to confirm this, that they would require a further seven days if they need to raise any matters that might arise out of Mr Wood's reply if he traverses beyond the traditional areas of reply. That's the case?

PN2311

MR CALVER: Commissioner, we will comply with your direction in that regard.

PN2312

MR STEVENSON: And the CCF will also comply.

PN2313

THE COMMISSIONER: That's good. On that basis the proceedings are adjourned to a date to be fixed, thank you.

<ADJOURNED INDEFINITELY [3.51PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #W1 SUBMISSIONS PN1558
EXHIBIT #W2 FACSIMILE TRANSMISSION AIG TO AWU DATED 17/03/2005 PN1567
EXHIBIT #S8 FACSIMILE TRANSMISSION RE APPLICATION TO VARY AWARD PN1970
EXHIBIT #S9 SUMMARY OF REDUNDANCY COAL ROYAL COMMISSION PN2051
EXHIBIT #C3 SUBMISSIONS OF MR CALVER PN2104