C2005/3162, Transcript of Proceedings [2005] AIRCTrans 2086 (7 October 2005)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996 12937-1

SENIOR DEPUTY PRESIDENT O’CALLAGHAN

C2005/3162

NATIONAL UNION OF WORKERS
AND
ARNOTT’S BISCUITS LIMITED
s.170LW - Application for settlement of dispute (certification of agreement)
(C2005/3162)

ADELAIDE

10.06AM, FRIDAY, 23 SEPTEMBER 2005

PN1

MR P NORTH: I appear on behalf of the National Union of Workers.

PN2

MR A SHORT: I appear for the company. I’m trying to recall if leave was already granted, but perhaps out of an abundance of caution, I seek it again.

PN3

THE SENIOR DEPUTY PRESIDENT: Very well, thank you. Mr North, is there any objection to Mr Short’s application for leave?

PN4

MR NORTH: No objection, your Honour.

PN5

THE SENIOR DEPUTY PRESIDENT: Very well. I grant that application, Mr Short. I might deal with some housekeeping issues first of all. The directions that were issued in this matter required the parties to exchange various submissions. I have received from Arnott’s - let me say first of all, received from the National Union of Workers a set of submissions which are entitled, "Submissions on behalf of the NUW". I note that attached to those is a witness statement. At this stage, I would propose to simply mark those submissions as NUW1.

EXHIBIT #NUW1 SUBMISSIONS ON BEHALF OF NATIONAL UNION OF WORKERS

PN6

THE SENIOR DEPUTY PRESIDENT: I will deal with the two witness statements in a moment. I also have received from the NUW submissions in reply.

EXHIBIT #NUW2 SUBMISSIONS IN REPLY

PN7

THE SENIOR DEPUTY PRESIDENT: I have received from Arnott’s an outline of argument and submissions, including a witness statement. Leaving that witness statement aside for the moment, I shall mark the Arnott’s submissions as A1.

EXHIBIT #A1 OUTLINE OF ARGUMENT AND SUBMISSIONS FROM ARNOTT’S BISCUITS LIMITED

PN8

THE SENIOR DEPUTY PRESIDENT: I can also advise the parties that I have copies of the various authorities to which I have been referred and I have read those authorities. I have also read the various submissions. I have deliberately not yet marked the witness statements because it occurs to me that it may or may not be necessary to call those witnesses, depending on whether cross-examination is required. In the event that it is necessary to call the witnesses and there is any form of challenge to the evidence they give, then we’ll deal with those witness statements at that time.

PN9

Otherwise I would simply propose to mark those witness statements at the point at which I am advised there is no dispute over the authenticity of that material. Now, the only other two things that I should foreshadow to the parties; I understand from my associate that a further document has been handed up by you, Mr Short. I have obviously not looked at that document. At this stage I won’t mark the document. I have a copy of the requisite agreement and I understand, drawing these preliminary comments to a close, that the purpose of today’s hearing is simply to provide for that opportunity to produce evidence, if that is in dispute, and secondly, to give the parties a very brief opportunity to address their written submissions.

PN10

I don’t expect the parties to canvass all that material once again. I promise I have read it. Now, Mr North?

PN11

MR NORTH: Thank you, your Honour. I had planned to call Ms Hadajafi for the simple purpose of having her witness statement tendered as evidence.

PN12

THE SENIOR DEPUTY PRESIDENT: Have you talked with Mr Short as to whether that is going to be necessary?

PN13

MR NORTH: My friend indicated that he didn’t wish to cross-examine. He may not - - -

PN14

THE SENIOR DEPUTY PRESIDENT: Mr Short?

PN15

MR SHORT: We don’t require Ms Hadajafi to be called. Her statement can be tendered, sir.

PN16

THE SENIOR DEPUTY PRESIDENT: Right. Do you still want to go ahead with calling the witness on that basis?

PN17

MR NORTH: No, that’s fine, your Honour.

PN18

THE SENIOR DEPUTY PRESIDENT: All right. We’ll move forward.

EXHIBIT #NUW3 STATEMENT OF MS HADAJAFI

PN19

THE SENIOR DEPUTY PRESIDENT: Now, I have not separately marked the attachments B, C and D because they’re simply referenced in the outline of submissions. Yes.

PN20

MR NORTH: No problems.

PN21

MR SHORT: Sir, if it’s convenient, and with my friend’s consent, if I could just speak to the additional documents that have been provided to the Commission and to my learned friend today. My friend had previously been good enough to indicate, when I’d contacted him, that in relation to Mr Browne there were some questions that they would seek to ask Mr Browne and so he’s available today. Shortly I will put his statement in through him and he will be available for cross-examination. Sir, some additional documents came to my attention today, and I have provided them to Mr North as soon as I was able to before this hearing.

PN22

Those documents, sir, relate to the development of the classification structure in 2000 and I have explained to my friend what they are and in due course, we seek to rely on them in relation to our submissions. I recognise sir, that they have not been provided in accordance with your directions. I can only say sir, that I wasn’t aware of them, that Mr Browne located them in the course of doing a clean-up and that there’s nothing sinister in relation to their late production, but they do appear to be of relevance to the development of skills classification.

PN23

Sir, I also recognise that if my learned friend is prejudiced in relation to that material, that we would not object to an adjournment if one was sought. What I have discussed with my friend, and he will correct me if I have this wrong, is that we would propose calling Mr Browne, putting the documents in and, if having heard that evidence my friend wishes to make any application, then we would recognise the circumstances in which it is put forward.

PN24

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. Yes, Mr North?

PN25

MR NORTH: I accept my friend’s assertion that the documents were only known to him this morning and they were provided to us as soon as they were known. However, given the proximity to the listing, we simply haven’t had a chance to digest their contents, or indeed, contact any of the people mentioned in the document to discuss the contents therein. So I would say that we’re not in a good position to be able to speak with authority or question the witness with authority on the contents of the documents, but as I say, I do accept Mr Short’s assertion that the documents were only known to him this morning.

PN26

THE SENIOR DEPUTY PRESIDENT: So what are you saying that I should do in relation to that additional document, or those additional documents?

PN27

MR NORTH: We accept there may be relevant material contained within the document and that my friend seeks to rely upon. I would reserve the right to request an adjournment if it becomes necessary to question the witness in relation to the contents of the document and perhaps to seek the advice of my colleagues in attendance. But I would emphasise that the documents were only provided this morning and that would be the reason for an adjournment.

PN28

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. Mr North, moving on from that issue, is there anything you want to say to me by way of brief oral submissions in relation to the argument put by the NUW?

PN29

MR NORTH: Yes. If I could address your Honour in relation to the written submissions, perhaps highlighting the most salient points therein. Our primary submission is that the company’s present practice of paying acting team leaders at their usual base rate of pay, albeit with an allowance, is in breach of the agreement. We say that the clear and unambiguous meaning of the agreement is that people who perform acting team leader duties should be paid at the level 5 base rate of pay, in addition to the allowance. I emphasise that it is not in dispute that the allowance is paid in accordance with clause 12C.

PN30

However, the dispute concerns the base rate of pay that employees engaged in acting team leader duties are entitled to. Our primary submission is that the words of the agreement are clear and unambiguous. The relevant clauses in the agreement are clauses 12C, 20 and also the classification structure contained in schedule A. The authority of Codelfa Construction Pty Ltd v The State Rail Authority of New South Wales establishes the proposition:

PN31

Where the words of a contract or legal document have a clear an unambiguous meaning, they should be interpreted in accordance with that meaning.

PN32

We have also, I think, cited at paragraph 12 of our written submission a decision of Ives DP in NUW v GrainCorp. Schedule A contains the classification structure for employees governed by the agreement. The function of team leader is not covered by the agreement. Subclause (5)(a) of the agreement states:

PN33

Parties to the agreement are employees of the company at the workforce who are covered by the classifications set out in schedule A to the agreement.

PN34

Team leaders are not covered by schedule A. Schedule A is structured under headings, "Level 1, Level 2, Level 3, Level 4 and Level 5", level 5 being the most senior and corresponding to the highest rate of pay. Under that heading of level 5 it is stated:

PN35

A level 5 employee may be selected to perform acting team leader duties.

PN36

So it is clear that level 5 employees may be selected to perform acting team leader duties and we say that the company has a discretion to select acting team leaders from the ranks of level 5 employees and that is the plain, unambiguous meaning of the statement:

PN37

A level 5 employee may be selected to perform acting team leader duties.

PN38

THE SENIOR DEPUTY PRESIDENT: So that if a level 3 employee is appointed or selected to perform acting team leader duties, I understand the NUWs submission to be that that employee would then need to be classified at level 5? Or are they deemed to be a level 5 employee?

PN39

MR NORTH: Our submission is that employees may be engaged to perform higher duties in accordance with clause 20, Mixed Functions, and that if an employee at levels 2, 3 or 4 was to be engaged as an acting team leader, then they would be engaged in higher duties for the purposes of clause 20, Mixed Functions, and so should be paid in accordance with clause 20.

PN40

THE SENIOR DEPUTY PRESIDENT: In that event, do you say that the person who is selected as an acting team leader is necessarily undertaking the range of functions which are set out as part of the definition of the skills associated with a level 5?

PN41

MR NORTH: We say that the acting team leader duties are expressly provided in schedule A, to be performed by level 5 employees and thus when an employee at below level 5 is engaged in such duties, they are exercising skills and performing tasks that are the province of level 5 employees, and thus they qualify for the level 5 base rate of pay in accordance with clause 20, Mixed Functions.

PN42

THE SENIOR DEPUTY PRESIDENT: Yes. Perhaps I’ll put that question another way. If I take you to level 5.

PN43

MR NORTH: Yes, your Honour?

PN44

THE SENIOR DEPUTY PRESIDENT: Perhaps starting at the beginning there; level 5:

PN45

Operators at this level are experts in their area with one or more equivalent level 3 skills in another area, or have a very broad skill base down the line.

PN46

Now, then the definition of level 5 extends to cover both examples and for combinations of the roles to be undertaken. So that if we had a situation where a level 3 employee was appointed as an acting team leader, would you say, then, that they would be undertaking that suite of functions associated with the definition of a level 5? Or are they level 5 simply because they are appointed as an acting team leader?

PN47

MR NORTH: Yes, your Honour. It’s our submission that an employee below level 5 appointed acting team leader isn’t necessarily performing the entire range of functions specified for a level 5 employee, but they are obviously performing the acting team leader duties which are a level 5 function as stated in the classification structure and that gives rise to their entitlement to the level 5 base rate of pay.

PN48

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN49

MR NORTH: Thank you. Further, on the classification structure, we note that there is no provision made for employees classified at level 1, level 2, level 3 or level 4 to perform acting team leader duties and it seems quite clear from reading schedule A as a whole that it is intended that level 5 employees are to be selected to perform acting team leader duties, rather than employees at other levels. As much as is perhaps confirmed further by the terms of clause 12C, which refers to acting team leader duties as outlined in level 5 of schedule A to this agreement, an acknowledgement that acting team leader duties are a level 5 function.

PN50

Clause 20, Mixed Functions, anticipates or implies that it will be necessary for the company from time to time to meet its operational requirements. It will be necessary to engage people beyond the scope of their usual classification and clause 20 governs the payment of people performing such higher duties. Clause 20 specifically refers to performing duties that attract a higher rate of remuneration. It is our submission that people classified at below level 5 who are performing acting team leader duties are performing higher duties and thus qualify for payment in accordance with clause 20.

PN51

Our primary submission is that these words are plain and unambiguous and should be interpreted as such. To the extent the Commission finds there is any ambiguity in those terms, we accept that evidence of the surrounding circumstances may be considered as an aid to interpretation. Authority for this proposition is found in Codelfa, with a statement of Mason J at page 352:

PN52

Evidence of surrounding circumstances is admissible to assist in the interpretation of the contract if the language is ambiguous or susceptible with more than one meaning.

PN53

It is our primary submission that the language is unambiguous and is not susceptible of more than one meaning. However, should the Commission find there is some ambiguity, we accept the surrounding circumstances are that the classification structure and mixed functions clauses that are in the present certified agreement are not materially different to those in the 2003 or the 2001 agreements. I understand that the classification structure is the subject of some negotiation prior to the 2001 agreement being certified. The company has applied certified agreements in the same way as it does at present, paying an allowance but not in accordance with the mixed functions clause since 2001 and the union has been unaware of the company’s practice up until in or around early May of this year.

PN54

Ms Hadajafi’s evidence attests to the union becoming aware of the issue at this time and the union has followed the dispute settling procedure in relation to the issue since. We say that as the union was unaware of the company’s practice in relation to the payment of acting team leaders before 2005, little is to be inferred from the union’s conduct before this time. It’s certainly not the case that the union supported or acquiesced to the company’s practice prior to 2001. The union was simply unaware and immediately activated the dispute settling procedure when it became aware. A further point alluded to - - -

PN55

THE SENIOR DEPUTY PRESIDENT: Before you leave that issue, you undoubtedly activated the dispute resolution procedure, but in the midst of that dispute resolution process, the parties consummated this new agreement?

PN56

MR NORTH: Yes, that’s correct, your Honour. I believe this new agreement was certified by the Commission on 4 July 2005. It was subject to a vote of the employees at the Arnott Marsden site prior to then, in accordance with the Workplace Relations Act and I understand that vote was finalised on
10 June 2005. In accordance with the statutory requirements, employees had ready access to a final draft, a final proposed draft of the certified agreement 14 days prior to 10 June. The acting team leader issue was - and I should say that certified agreement was the subject of some long and arduous negotiation in the months prior to certification.

PN57

The issue of the payment of the acting team leaders became known to the union in or around early May when enterprise bargaining negotiations were well and truly progressed. The NUW immediately took the issue to the management, at first orally and then by way of a letter dated 23 May. As Ms Hadajafi’s witness statement attests, the company forwarded a reply to the NUWs letter on 6 June 2005. Now, at that point, 6 June, the final proposed draft of the certified agreement was already on the - had already been made available to employees ahead of a vote and there was an unwillingness to further protract the enterprise bargaining process by discussing a new issue, new contentious issues so late in proceedings.

PN58

Hence, the issue was treated by the parties as an issue separate to the enterprise bargaining negotiations that led to the current agreement being certified in July 2005.

PN59

THE SENIOR DEPUTY PRESIDENT: So that in terms of the interpretative principles that are so concisely summarised by DP Ives in GrainCorp, I take it what you’re saying to me is that I should make nothing of the fact that the parties were aware of this difference of opinion about presumably the former agreement provisions?

PN60

MR NORTH: That is our - - -

PN61

THE SENIOR DEPUTY PRESIDENT: That carry over into this agreement?

PN62

MR NORTH: I apologise, your Honour. That is our submission, your Honour. Again, I just reiterate that the company put its position in writing to the NUW on 6 June 2005 when employees were to hold a vote upon the final proposed draft just in the immediate days following that date. So I submit that the issue of acting team leaders and the payment of was treated by the parties as separate and distinct from the enterprise bargaining process and it’s our submission that nothing can be inferred from the fact that the relevant provisions in the 2005 agreement are not materially different to the previous agreement that it replaced.

PN63

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN64

MR NORTH: A further point we note is that - and this is explained in our written submission you have marked NUW1 at paragraph 22 - the point being that the company’s present practice in relation to the payment of acting team leaders allows for acting team leaders to receive different rates of remuneration while performing acting team leader duties. It is possible infer from schedule A and clause 20 an underlying rationale that people performing the same duties or class of duties are to be paid at the same rate and the interpretation advocated by the NUW would allow for acting team leaders to be paid at the same rates while they’re performing acting team leader duties which we say is consistent with schedule A and clause 20.

PN65

THE SENIOR DEPUTY PRESIDENT: Does that issue not have a converse effect in that if your argument is correct, then all acting team leaders would be paid at the level 5 rate, but as a consequence of that, not all level 5 classification employees would have the same skill set or be performing the same duties? In that, as a consequence of your argument some of the people who would be paid at the level 5 rate would only have skills commensurate with, say, a level 3. If that’s the case, what do you say to me about that consequence, if you like, of the approach you are urging?

PN66

MR NORTH: We say the approach we are urging is consistent with schedule A and clause 20 because people who are classified at below level 5 performing acting team leader duties are performing duties expected of level 5 employees and that gives rise to their entitlement to the level 5 base rate.

PN67

THE SENIOR DEPUTY PRESIDENT: Yes. We covered this earlier. We might have to revisit it, I’m sorry, because I’m not sure I fully understood that. If we go back to the level 5 definition and adopt the approach that you’re urging, then it would mean that an employee who you would agree was properly classified at, say, level 3 must, by virtue of the fact only that they have been selected to perform the acting team leader duties, be classified at level 5. As a consequence, it would need to be accepted, then, that that employee did not meet the operational skill descriptors associated with level 5, but they are a level 5, you say, because of their selection as an acting team leader.

PN68

Now, the issue that I’m flagging with you is you said there is an inequity in the current arrangement because acting team leaders may be paid different amounts. I’m asking whether there is a corresponding reverse in equity, if you like, as a result of the adoption of your approach in that if you scanned across the people who would then be paid the level 5 rate, they would be doing quite different things and a number of them would not have the same operational skills as the others have.

PN69

MR NORTH: I take your Honour’s point. It’s not our argument that a person below level 5 engaged in acting team leader duties does necessarily have the same operational skills to which you referred. It’s our argument that acting team leader duties are a function in accordance with schedule A, are a level 5 function, so those people are performing a function of level 5 employees and so there is equity in the pay rate, if they are all paid at that same rate. In conclusion, your Honour, I would just reiterate that our primary submission is that the words are plain and unambiguous, the words of schedule A and clause 20, and should be interpreted in accordance with their plain meaning. If your Honour has no further questions, I would - - -

PN70

THE SENIOR DEPUTY PRESIDENT: There is one other issue that I raise with you, Mr North. Can I put the proposition to you that there would seem to be three possibilities. You have urged upon me one that says, in effect, an acting team leader could only be selected from as a level 5 employee. A prerequisite, if you like, for selection, is that the employee be classified as level 5. Is that another way of phrasing what you’re putting to me?

PN71

MR NORTH: I think, your Honour, that the terms of schedule A indicate that it is level 5 employees who are to be engaged on acting team leader duties and your Honour is quite right. However, we do say that when schedule A is read in accordance with clause 20, Mixed Functions, one understands that clause 20 implies, if you like, that the company is to, as it deems necessary, engage employees in higher duties or duties beyond the scope of their usual classification. We say that that gives rise to a right or a right of the company to engage persons below level 5 to perform acting team leader duties if the company deems that to be necessary.

PN72

However, we say that those persons need to be paid in accordance with clause 20, Mixed Functions.

PN73

THE SENIOR DEPUTY PRESIDENT: All right. Now, at the other end of the spectrum, if I have properly understood Mr Short’s argument, and I should say in that regard if I haven’t, I have no doubt he will correct me in a couple of minutes’ time; it is to the effect that acting team leaders could be selected from any classification on the basis that the reference to the acting team leader function in the level 5 descriptor does not establish any necessary link between that level 5 position and the acting team leader position or function.

PN74

Now, the question that I have for you is whether or not there is a third position or option, and that is to say, if the acting team leader could only be selected from the level 5 classified employees, then the selection of a lower classified employee may not be consistent with the agreement, but would not necessarily qualify the employee concerned for the payment of the allowance as the employee is not undertaking those level 5 functions.

PN75

MR NORTH: Could your Honour please restate the second part of that proposition?

PN76

THE SENIOR DEPUTY PRESIDENT: What I am putting to you is, whether or not, if a pre-condition for selection of an acting team leader is a level 5 classification, then the selection of a lower classified employee may in effect be in breach of the agreement. That might be a different issue to the question of whether or not that lower classified employee is (a) entitled to the allowance at all, and (b) entitled to the level 5 rate.

PN77

MR NORTH: Well, it is - - -

PN78

THE SENIOR DEPUTY PRESIDENT: I am just putting to you that third option for a comment.

PN79

MR NORTH: I can only really reiterate our initial arguments in terms of the reading of schedule A and clause 20, and it is clause 20 that would give the company scope to engage persons in duties beyond their classification, their usual classification, and so we would say - and clause 20 doesn’t exclude any functions, but simply refers to duties, and we say that incorporates acting team leader duties and so gives the company scope to select employees who are classified at below level 5 to perform acting team leader duties. Although the terms, I agree with your Honour’s reading of schedule A, it is quite particular in that level 5 employees are to be selected to perform acting team leader duties. We say - - -

PN80

THE SENIOR DEPUTY PRESIDENT: I’m not putting a proposition at this stage, I am just asking questions.

PN81

MR NORTH: Certainly, your Honour.

PN82

THE SENIOR DEPUTY PRESIDENT: But, yes. Thank you, Mr North.

PN83

MR NORTH: Thank you, your Honour.

PN84

THE SENIOR DEPUTY PRESIDENT: Mr Short?

PN85

MR SHORT: Thank you, sir. You have the outline and I will put some submissions in relation to that shortly, but perhaps the most appropriate course, sir, would be for me to call Mr Browne and deal with those aspects, if that’s a convenient course for your Honour?

PN86

THE SENIOR DEPUTY PRESIDENT: Yes. I am happy with that approach.

PN87

MR SHORT: I call Mr Browne.

<HOWARD GEORGE BROWNE, AFFIRMED [10.46AM]
<EXAMINATION-IN-CHIEF BY MR SHORT [10.47AM]

PN88

MR SHORT: Sir, if Mr Browne could be shown the statement that’s been filed in this matter?

PN89

Looking at that document, Mr Browne, do you recognise that as your statement filed in this matter?---I do.

PN90

Is it correct to your recollection and knowledge, accurate as to the matters contained in it?---It is.

PN91

I seek to tender that statement.

EXHIBIT #A2 WITNESS STATEMENT OF H G BROWNE

PN92

MR SHORT: Mr Browne, I think you have also recently located some documents relating to the establishment of a skill structure?---I have.

PN93

Looking at the documents now shown to you, are those the documents that you recently located?---They are.

PN94

Just working our way through that bundle of documents - - -

PN95

Sir, do you have a copy?

PN96

THE SENIOR DEPUTY PRESIDENT: Yes, I do.

PN97

MR SHORT: At page 1, can you tell us what that is?---Page 1 was the initial agenda of the first meeting to be held, to try and put forward a - or try and form a committee to deal with the skill structure reclassification.

PN98

You were an attendee at those meetings?---I was.

PN99

Frances Ashworth was also an attendee?---She was.

PN100

Where is Frances from?---She was a union - an NUW organiser at the time.

PN101

Right. She participated in the development of the skill structure?---Yes.

PN102

Yes. Page 2, headed, "Committee Members", can you tell us what that is?---They were the employees that were selected by a nomination process, plus the management team members that were asked to form - or be part of the committee, along with union representation.

**** HOWARD GEORGE BROWNE XN MR SHORT
PN103

So they are the people who participated in the development of the skill structure; is that it?---That’s it.

PN104

Page 3 has a heading, "Expressions of Interest". Can you tell us what that is?
---That was the notice that was put on the board in the factory for employees to nominate themselves to be on the committee.

PN105

Pages 4 through to 7 lists 174 - as I follow the numbering - items. What is that?
---They were the number of skills identified that were currently in place in the factory that we had to reclassify.

PN106

On the right-hand side, there seems to be a column headed "Session" and that has numbers 1 through to 4. What does that mean?---That means just to the high number of skills that we had to reassess, we just divided them up into four sessions and dealt with each group at a - each individual session.

PN107

All right. So when the skill structure was developed, were these 174 items the matters taken into account?---Yes.

PN108

Pages 8 through to 11 headed, "Shift Analysis Query Cross-Tab", what is that?
---That is just a breakdown of the shift teams that we had operating at the time and how many people on those teams had the skills that they were listed against.

PN109

So if we take the very first item, "Carry out basic ingredient preparation", can you just take us through what figures and headings that tells us?---Okay. Regarding that one, that says to us that on the dayshift, which refers to the 8-hour shift, there were 12 people that could do that task. On afternoon shift there were four, on nightshift there was nobody. On the 12-hour day 18, there were two. On the 12-hour day blue team, or B team, there was one. On the 12-hour night A team there were five, and on the 12-hour night B team there was one.

PN110

Right. Sir, I seek to tender that bundle of documentation.

PN111

THE SENIOR DEPUTY PRESIDENT: Mr North, is there any objection to the document being tendered?

PN112

MR NORTH: Your Honour, we accept it’s a true and correct copy of the document that the witness swears it to be. Again I reiterate that we received this document - - -

**** HOWARD GEORGE BROWNE XN MR SHORT
PN113

THE SENIOR DEPUTY PRESIDENT: Yes. Well, there seems to be a number of options in this regard. You could of course argue that I ought not have regard to the document, given the late timing, but that would appear to be a little inconsistent with the statements you have already made. You could proceed on the basis the document would be admitted, and you would have the opportunity to question Mr Browne on it, but you might want to reserve your rights to either put an additional written submission to me within a nominated time-frame, or alternatively, you might want to reserve your rights to recall Mr Browne after a nominated time.

PN114

Now, there might be other options; I can’t think of them off the top of my head, but what I’m seeking from you is some indication as to what it is you want me to do in relation to the document. Take your time in terms of responding. If you want to have a talk with those people instructing you, feel free to do so.

PN115

MR NORTH: If your Honour would - - -

PN116

THE SENIOR DEPUTY PRESIDENT: Yes. I won’t adjourn the matter, but by all means, turn around and have a talk.

PN117

MR NORTH: Thank you, your Honour.

PN118

THE SENIOR DEPUTY PRESIDENT: Yes, Mr North?

PN119

MR NORTH: Thank you for granting that indulgence, your Honour. We would seek leave to file a written submission in relation to this document at a later date of your Honour’s choosing, if that is a course acceptable to your Honour and my friend.

PN120

THE SENIOR DEPUTY PRESIDENT: I see. But on that basis, you’re happy for the document to be admitted?

PN121

MR NORTH: Yes, your Honour.

PN122

THE SENIOR DEPUTY PRESIDENT: Thank you. I will admit the document.

EXHIBIT #A3 DOCUMENTS RELATING TO ESTABLISHMENT OF A SKILL STRUCTURE

PN123

MR SHORT: Thank you, sir. I have no further questions for Mr Browne.

**** HOWARD GEORGE BROWNE XN MR SHORT
PN124

THE SENIOR DEPUTY PRESIDENT: Yes. Mr North?

PN125

MR NORTH: Thank you, your Honour.

<CROSS-EXAMINATION BY MR NORTH [10.58AM]

PN126

MR NORTH: Just a handful of questions, Mr Browne. As I say, we’ll leave the document to one side and concentrate on your witness statement, if you have it in front of you?---Certainly.

PN127

What skills are involved in being a team leader? People management, supervision?---Yes.

PN128

Do you agree?---Yes.

PN129

Right. Anything else? Data entry? Administrative?---Not wholly and solely, no.

PN130

No?---We do have other people who do that, so - - -

PN131

People management and supervision of other employees?---It’s more - more to the point of responsibilities for ensuring the data is entered.

PN132

Right, so a supervisory, or oversight, of other employees performing those tasks?
---Yes.

PN133

What’s expected? Thank you. At paragraph 10 of your witness statement, you suggest that people at level 3 or level 4 may be suited to an acting team leader role?---Definitely.

PN134

And yet the role involves supervision of other employees?---Yes.

PN135

So would it be the case that a level 3 employee who was selected as an acting team leader would be supervising people on the line at level 1, level 2, level 3, level 4 and level 5?---Yes, that would be true.

PN136

I’d also like to take you to paragraph 11 of your witness statement, Mr Browne. In it, you refer to the classification structure and references included under the headings level 2, level 3, level 4 and level 5. The references you refer to, level 2, level 3 and level 4, are the last lines? I take it that is under level 2:

**** HOWARD GEORGE BROWNE XXN MR NORTH
PN137

Employees will remain at level 2 for a minimum of 6 months.

PN138

Is that the lines which you - - -?---Yes - - -

PN139

- - - are referring to in paragraph 11?--- - - - without having them in front of me, I - that’s similar to what was mentioned, yes.

PN140

Okay, and under level 3, you agree that that last line you refer to is:

PN141

Employees will remain at level 3 for a minimum of 12 months.

PN142

?---Yes.

PN143

And level 4, the final line is:

PN144

Employees will remain at level 4 for a minimum of 2 years.

PN145

?---That’s right.

PN146

Thank you. The final lines of level 5 to which you refer don’t refer to any time-frame for moving through the classification structure, do they?---No, they don’t.

PN147

No. They refer to duties which people might be expected to perform, do they not?---Again, without having them in front of me, I recollect that’s the case, yes.

PN148

If I perhaps read a part of it to you:

PN149

A level 5 employee may be selected to perform acting team leader duties and in this capacity take responsibility for line accountabilities, including safety, quality, efficiency, waste reduction and continuous improvement.

PN150

That’s the statements of the level 5 to which you’re referring?---Yes.

PN151

Thank you, and - - -

PN152

MR SHORT: Sorry, that’s one of the dot points.

PN153

MR NORTH: Sorry, I - - -

**** HOWARD GEORGE BROWNE XXN MR NORTH
PN154

THE SENIOR DEPUTY PRESIDENT: Yes. You might just need to clarify that with the witness.

PN155

MR NORTH: Sorry, I apologise.

PN156

THE SENIOR DEPUTY PRESIDENT: It might help, Mr North, if the witness has access to that particular level 5 definition. It seems to me that everybody in the room has one rather than the witness.

PN157

MR NORTH: Yes, certainly. I apologise, your Honour. I don’t think I have a copy readily at hand.

PN158

THE SENIOR DEPUTY PRESIDENT: I will lend the witness mine.

PN159

THE WITNESS: Thank you.

PN160

MR NORTH: Mr Browne, we’re at the dot points under the heading, "Level 5". They refer, do they not, to people performing acting team leader duties?---As - yes, that’s one of the points.

PN161

Thank you. That is something quite different in character, is it not, to the references we mentioned in level 2, level 3 and level 4?

PN162

MR SHORT: With respect, I object to that question. Isn’t that really a matter for submissions rather than evidence?

PN163

THE SENIOR DEPUTY PRESIDENT: Yes. Well, I’ll allow the question. Obviously the witness can only answer it to the extent of his understanding.

PN164

MR SHORT: Yes, sir.

PN165

THE WITNESS: I think, like the other statements made, it is not a requisite, to get to that level. It is merely a statement at the end of the level structure.

PN166

MR NORTH: Okay. Just finally, if I take you all the way down to paragraph 18 of your statement and you can confirm that no issue has been raised in regards to the company’s practice in regards to acting team leaders until 2005?---That’s correct.

**** HOWARD GEORGE BROWNE XXN MR NORTH
PN167

Thank you, Mr Browne. I don’t have any further questions.

PN168

THE SENIOR DEPUTY PRESIDENT: Mr Short?

PN169

MR SHORT: No re-examination, sir.

PN170

THE SENIOR DEPUTY PRESIDENT: Mr Browne, I have a couple of questions that I just want to raise with you, and so that you know what will happen, I will extend to Mr North and then Mr Short the opportunity to follow up, if they wish to do so, but only on those issues that I am going to raise with you. Now, can I take you to the definition of level 5 in the agreement? Do you have that there?---I do.

PN171

Can I ask you to look at the third-last dot point which reads:

PN172

An employee at level 5 will, if required, train and assess other operators.

PN173

?---Yes.

PN174

Is that a characteristic of the level 5 function?---In their role as being the expert operator of those machines, it sometimes is required of them that they will assess other operators to gain an up-skilling level of other operators, so yes, that would be the case. Not in all cases, but at times.

PN175

I see. If I then ask you to look at the second dot point which is the contentious provision relating to acting team leaders, do you ask acting team leaders to undertake a training function with particular relevance or reference to any one or range of machines?---An acting team leader from another level, no.

PN176

So that if, for instance, there was to be a level 3 employee who was selected as an acting team leader, is that person expected to undertake any form of training activity relative to a machine they may not be expert in operating?---None at all.

PN177

Finally, if ask you to look at that second-last dot point, should I understand that the concept of supervision is what you describe as the various responsibilities that are set out in that particular dot point? That is, is supervision, or your expectation of supervisory functions, synonymous with the responsibility for line accountabilities, including safety, quality, efficiency, waste reduction and continuous improvement?---Yes.

**** HOWARD GEORGE BROWNE XXN MR NORTH
PN178

Thank you. Mr North, do my questions occasion the need for you to ask the witness anything further?

PN179

MR NORTH: I beg your pardon, your Honour?

PN180

THE SENIOR DEPUTY PRESIDENT: Do my questions mean that you want to ask the witness anything further?

PN181

MR NORTH: No, I have no further questions at this stage, your Honour.

PN182

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Short?

PN183

MR SHORT: No, sir.

PN184

THE SENIOR DEPUTY PRESIDENT: Mr Browne, thank you for your evidence. You’re released?---Thank you.

<THE WITNESS WITHDREW [11.08AM]

PN185

MR SHORT: Sir, we don’t seek to call any other evidence. I’ll now put my submissions and I’ll endeavour to keep them to submissions by way of clarification rather than entire repetition.

PN186

THE SENIOR DEPUTY PRESIDENT: If you repeat the whole exercise, I might fall asleep, Mr Short, so I can assure you that I have read it.

PN187

MR SHORT: Indeed. Now, it’s apparent, sir, that the relevant clauses are the same in the 2003 agreement, the 2001 agreement and the 2005 agreement, and you have the various extracts placed before you. You have the 2005 agreement and the earlier versions. Relevant portions were attached to the respective submissions. You also have seen, sir, that the object of the 2005 agreement is set out in clause 3 and that, sir, encourages cost competitive, flexible and innovative manufacturing practices, and the company’s ability to meet and exceed customer and consumer expectations in a competitive environment.

PN188

The objectives of flexibility, sir, encourage, in our submission, the approach which the company has adopted and did not accord with the NUWs construction of the agreement. Sir, it will be a matter of the Commission’s records, but those same objectives appear in the 2003 and 2001 agreements. Sir, you have raised three possible interpretations of the document. Now, my learned friend would say that the agreement clearly and unambiguously means what the NUW contends. We would say it clearly and unambiguously means what we contend. You have also raised a third construction which is - - -

PN189

THE SENIOR DEPUTY PRESIDENT: Before you go to that third construction, were you happy with the way in which I summarised the position in terms of Arnott’s.

PN190

MR SHORT: As I recall it, it was to the effect that we can choose which employees take on the acting team leader role, because the acting team leader role is not limited to level 5 employees. It involves a different skill set, that the acting team leader role looks at - I’m going beyond it, but I think this will accord with what you said, sir - people management, whereas the classification structure looks at operator skills, being a different set of skills. Performance of the people management role does not of itself qualify an employee for a level 5 classification and rate of pay.

PN191

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN192

MR SHORT: Someone may be very good at dealing with people and may be absolutely hopeless at operating machines. They wouldn’t qualify as level 5 and they couldn’t qualify as level 5, but they may be very well suited for an acting team leader role. Indeed, a team leader themselves may not be a good operator, but may deserve and warrant and have a permanent team leader role, due to their people management skills. Sir, the third interpretation which you put forward would mean, as you say, that there may not be a technical compliance with the agreement, but it’s not productive of any entitlement to an additional payment to an employee because the employee would still not meet the level 5 requirements and would have no entitlement to any higher amount of pay.

PN193

Such a construction, in my submission, sir, would be against the objectives of the agreement because it would limit flexibility. So also the NUWs construction would, in my submission, be against the objectives of the agreement because it would mean that only a level 5 employee could be an acting team leader and the follow-on would be that someone performing an acting team leader role is automatically a level 5 employee, which would result in higher cost and be against the objective of cost competitiveness. It would also lead to inequity, in that, sir, operators who do not have the skill-set in relation to operating machines required by the level 5 classification would be getting the same rate of pay as more skilled employees.

PN194

It would be getting more money despite having lesser skills, and that would seem inequitable. That was a point, sir, that you raised in the course of my friend’s submissions. Sir, there is an issue, and it’s a matter for you what weight you give it, in relation to the 2005 agreement having been put forward where the company’s position was known and the company’s position was that its longstanding practice accorded with what was permissible under previous agreements. It wasn’t for the company to go forward and suggest the agreement be changed because it was the company’s position that its practice complied with the terms of the agreement.

PN195

It would appear, sir, that the NUW chose to proceed, notwithstanding its knowledge of the company’s construction of the agreement and its knowledge at the time the agreement went forward for a vote, that that practice had been in existence for some substantial time. The agreement should be interpreted, sir, on a basis that favours, we submit, legality, that favours a construction that what has been done was lawful and our construction does that. The NUWs construction would suggest that what we have done was in breach of the agreement.

PN196

Sir, it is apparent that the classification structure does contain words which are not descriptive of requirements to get into that classification in the first place. You have heard Mr Browne had his attention drawn to the levels 2, 3 and 4 definitions in that regard and in respect of level 5, it’s apparent that the requirements to come within the classification are those items which fit under the headings of "Area" and "Role" and that the last three dot points are not requirements in order to come within the classification in the first place. For example, the dot point was:

PN197

Working in this capacity, an allowance will be paid -

PN198

Has nothing to do with whether or not an employee comes within the classification in the first place.

PN199

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Short, this goes to the question that I was raising with Mr Browne. If you look to those three dot points at the bottom of level 5, do you say to me that the allowance which is referenced in the last of those dot points is payable only when an employee is performing those acting team leader duties?

PN200

MR SHORT: Yes.

PN201

THE SENIOR DEPUTY PRESIDENT: Or is it also the case that an allowance is payable if an employee at level 5 is required to train and assess other operators?

PN202

MR SHORT: No. There is no requirement to pay the allowance when training and assessing other operators.

PN203

THE SENIOR DEPUTY PRESIDENT: So something groups the last two dot points separately to the first dot point, does it?

PN204

MR SHORT: It is apparent, sir, that this is a document which has not been drafted by lawyers; it’s done in an industrial context and there’s nothing novel about that, so - - -

PN205

THE SENIOR DEPUTY PRESIDENT: Yes. I have seen worse.

PN206

MR SHORT: So I don’t seek to raise criticism of others in the drafting, and indeed, I only say anything about drafting because it’s not my document. Otherwise, people might be saying the same thing about some of the things I have prepared. No, the last dot point sir, in our submission, relates to the acting team leader allowance and with a bit of a cross-reference back to clause 12C, the acting team leader allowance, because there’s no provision in the agreement or any allowance in respect of training and assessing other operators. But there is an allowance in clause 12C, of course, for acting team leaders.

PN207

Clause 12C, when it refers to the allowance, in turn refers to level 5 of schedule A, so that may give some assistance, sir, in construing the operation of those passages.

PN208

THE SENIOR DEPUTY PRESIDENT: If the second and third dot points need to be considered together - which I understand you to be saying - and in effect, if they should be read in the context of 12C, then how is it that you say to me that the agreement, as distinct from the company’s practice, allows for other than a level 5 employee to be selected to perform those acting team leader duties?

PN209

MR SHORT: Yes. Clause 12C, sir, indicates the reference to what task attracts the allowance and that’s the acting team leader duties and then that is, if you like, described in terms of what are those responsibilities. So it’s undertaking those responsibilities that qualify an employee for an allowance. There is a reference to a level 5 employee may be selected, and we put that forward, sir, as being indicative of an expectation, not a requirement in order to come within the classification in the first place, but rather as indicating that more senior employees may be selected. It is not exhaustive, sir. It is not saying only level 5 employees may be selected.

PN210

So we say that it illustrates a level of employee that may be selected; it does not exhaust the level of employees that may be selected, and that our construction which is consistent with legality in relation to the practice that has been observed from the introduction of the skill structure, ought be preferred over a construction that results in illegality. I have said, sir, if it said only level 5 employees may be selected, that our submission would not be tenable, but that is not the wording of the document.

PN211

THE SENIOR DEPUTY PRESIDENT: So in that context, if I looked at the first dot point, is it the case that an employee at level 4 could be required to train and assess other operators?

PN212

MR SHORT: The agreement is simply silent as to that, as to whether there is an obligation on such a person to train and assess someone. The agreement does not address it. What it does do is address that an employee at level 5 will do it if required, and if a level 4 employee, sir, had the relevant skills to train and assess someone, there’s nothing in the agreement that says they can’t be asked to do it, but there is a requirement on a level 5 employee to do so if asked. If that’s an answer to your question, sir?

PN213

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you.

PN214

MR SHORT: Now, sir, you correctly identified that the people management element would result in someone perhaps not having any of the requisite skills listed in level 5 attracting the level 5 classification and rate of pay if the NUWs argument was correct, and we say that’s - you really only need to state the resulting order to be clear that that can’t be a proper construction of it. A consequence of the NUWs construction, sir, would seem to be that people with good people management skills, but who are classified at level 4 or below, would suffer detriment, in that there would be a natural inclination not to put them in an acting team leader role, although it may be the best outcome for the business because of the additional cost that would be imposed.

PN215

It would be an impediment to flexibility, it would be an adverse result in terms of productivity and the agreement ought be interpreted in a fashion that does not lead to such a consequence. Sir, the evidence of Mr Browne in relation to the development of the skill structure, combined with his statement as to how that skill structure has been rolled into the subsequent enterprise agreements, also makes it clear, sir, as we say the skill structure on its face does, that people management was not and is not a requirement for the level 5 classification. It’s not one of the requisite skills sets, and that the structure hasn’t been fashioned in that way, rewards operating skills or technical skills, not people management skills.

PN216

We say that that ground is a relevant circumstance to the construction of the document and clearly that it favours our interpretation and construction and practice. Now, unless there’s anything further, sir, those are our submissions.

PN217

THE SENIOR DEPUTY PRESIDENT: I don’t have anything further, thank you. Mr North?

PN218

MR NORTH: Thank you, your Honour. I won’t reiterate the arguments we have already made in relation to some of the points my learned friend raised. The clause 3 objectives are a rather, might I say, vague statement of - mission statement, if you like, and is probably very closely aligned to the objectives or mission statements of most other companies in all industries across the state, and I don’t think that the words of the clause bear any great meaning in relation to the clauses over which the dispute centres, schedule A, clauses 20 and 12C.

PN219

My friend raised the issue of the recently-certified agreement and the standing of this dispute in relation to that agreement. We have already addressed your Honour on that issue and I simply reiterate that both parties, the NUW and Arnott’s, treated the issue of the payment of acting team leaders as separate to the enterprise bargaining negotiations that took place prior to the certification of the present agreement on which the dispute centres, and would again state that those negotiations were, in effect, over and the employees were almost in a position of voting on the document when the company put its written position on the issue raised by the NUW.

PN220

Again, we simply restate the submission that the words of schedule A are unambiguous and that a level 5 employee may be selected to perform acting team leader duties clearly intends to confine the acting team leader duties to level 5 employees and it is only by reference to the mixed functions clause, clause 20, that the company has an ability to engage persons classified at below level 5 as acting team leaders. If your Honour has nothing further, I’ll leave my - - -

PN221

THE SENIOR DEPUTY PRESIDENT: Mr North, can we just dwell on that a little further? Can I tease out the two issues that I raised with Mr Short in relation to the three dot points at the conclusion of the level 5 position, perhaps starting with that first dot point that reads:

PN222

An employee at level 5 will, if required, train and assess other operators.

PN223

Do you say that I should regard that training requirement, if I could call it that, as something distinct from the characteristics that qualify an employee for an allowance in accordance with the third dot point? That is, to gain an allowance, is it the case that an employee has to either train and assess other operators, or be selected to perform acting team leader duties, or both?

PN224

MR NORTH: Well, it does seem that the reference to this capacity is somewhat ambiguous, your Honour. Again, I don’t wish to criticise the drafting of the document, but I agree, it’s somewhat ambiguous as to what that reference to this capacity actually refers to.

PN225

THE SENIOR DEPUTY PRESIDENT: All right. Well, if we move on from that issue to once again looking at that first dot point. Does that mean that you consider that employees at level 4 cannot be required to train and assess other operators? That is, is the training and assessment of other operator functions the sole prerogative of a level 5 employee?

PN226

MR NORTH: My reading of that first dot point is that the training requirement, as your Honour referred to it, is intended to be the province of level 5 employees, however, again consistent with our arguments in relation to acting team leader duties, clause 20 would seem to confer upon the company an ability to engage people at higher duties and may give scope for the company to engage someone at below level 5 to perform that function if the company’s operational requirements necessitated that course of action.

PN227

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. Finally, the document I have marked A3, the document tabled today and referred to by Mr Browne, how long will you need to provide any written comments that you may or may not wish to make? Would a week be a convenient time-frame?

PN228

MR NORTH: Your Honour, in the normal course of events, a week would be more than adequate.

PN229

THE SENIOR DEPUTY PRESIDENT: I forgot, you’re interstate next week.

PN230

MR NORTH: I will be interstate a large portion of next week. Perhaps early in the following week would be more realistic, although we may have the complication of a long weekend as well.

PN231

THE SENIOR DEPUTY PRESIDENT: What about 5 October?

PN232

MR NORTH: Yes, that would be adequate.

PN233

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr North.

PN234

MR SHORT: Sir?

PN235

THE SENIOR DEPUTY PRESIDENT: Mr Short?

PN236

MR SHORT: There may be just one matter where I - in relation to training and assessment where I indicated the agreement was silent, and I’ve been corrected on that by those instructing me and it’s proper that I point it out, sir. Could I invite your attention to schedule A of the enterprise agreement, under the heading, "General Principles"? At about the tenth dot point, sir, you will see there’s reference to training:

PN237

All employees are required to buddy-train others in their role.

PN238

And that appears to be without reference to classification, sir, but all employees are required to do some form of training of others. Department trainers sit at level 4:

PN239

Employees at level 5 will, if required, be formally trained to train others.

PN240

Sir, that’s not saying that they will, if required, train others, but rather, they will get formal training themselves in conducting that training. It is an expectation, it seems, sir, of all employees that they will conduct training irrespective of their classification. And you will see, sir, that assessing is part of the base competency for a job at level 3 and above. So that training and assessing does not, as I read both principles, sir, require a level 5 classification, nor does it entitle the employee to an allowance.

PN241

THE SENIOR DEPUTY PRESIDENT: Yes.

PN242

MR SHORT: So sorry, sir, for my oversight in not raising that earlier.

PN243

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. Obviously I’ll reserve a decision on this matter pending receipt of any written material from Mr North. Mr North, it does occur to me, and I may have phrased that written material invitation in absolute terms. If you find that, having considered the material in A3, you do not consider it necessary to put written submissions to me, then if you advise my office of that, that will expedite the decision-writing process. Otherwise, the parties can expect a decision some time between one and two weeks from 5 October.

PN244

MR NORTH: Thank you, your Honour.

PN245

THE SENIOR DEPUTY PRESIDENT: I’ll adjourn the matter on that basis.

<ADJOURNED INDEFINITELY [11.36AM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #NUW1 SUBMISSIONS ON BEHALF OF NATIONAL UNION OF WORKERS PN5
EXHIBIT #NUW2 SUBMISSIONS IN REPLY PN6
EXHIBIT #A1 OUTLINE OF ARGUMENT AND SUBMISSIONS FROM ARNOTT’S BISCUITS LIMITED PN7
EXHIBIT #NUW3 STATEMENT OF MS HADAJAFI PN18
HOWARD GEORGE BROWNE, AFFIRMED PN87
EXAMINATION-IN-CHIEF BY MR SHORT PN87
EXHIBIT #A2 WITNESS STATEMENT OF H G BROWNE PN91
EXHIBIT #A3 DOCUMENTS RELATING TO ESTABLISHMENT OF A SKILL STRUCTURE PN122
CROSS-EXAMINATION BY MR NORTH PN125
THE WITNESS WITHDREW PN184