AG2004/8269, Transcript of Proceedings [2005] AIRCTrans 303 (8 February 2005)

1800 534 258

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 10273

SENIOR DEPUTY PRESIDENT O'CALLAGHAN

AG2004/8269

s.170LJ - agreement with organisations of employees (division 2)

APPLICATION BY UNITED KG PTY LTD AND OTHERS
(AG2004/8269)

ADELAIDE

9.30AM, FRIDAY, 28 JANUARY 2005

Adjourned sine die

PN1

MR B KLITSCHER: I appear on behalf of United KG. With me is
MR G CORNISH, safety and HR manager.

PN2

MR FENNEY: I appear on behalf of the AMWU and with me are
MR M STRAIN, he is an employee for United KG Whyalla.

PN3

MR HALL: I appear for the Australian Workers' Union.

PN4

THE SENIOR DEPUTY PRESIDENT: Thank you. I can advise the parties that I have read the statutory declarations and I have read the agreement. I have a couple of questions about the process that was followed and then I have some questions about the agreement. Mr Klitscher are you able to advise me of the date upon which the agreement was provided to employees, that is, in its final form?

PN5

MR KLITSCHER: I cannot but perhaps - it was late November your Honour, last year.

PN6

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Klitscher. Mr Hall, my question to you is generated by your statutory declaration. The signature page appears to be quite different to the rest of the document. Are you able to help me out in that regard?

PN7

MR HALL: I hope so, sir.

PN8

THE SENIOR DEPUTY PRESIDENT: In terms of explaining why it is the document is so different? It is the statutory declaration that I am looking at.

PN9

MR HALL: Okay.

PN10

THE SENIOR DEPUTY PRESIDENT: Do you have that?

PN11

MR HALL: I do not believe I have a copy of it, your Honour.

PN12

UNIDENTIFIED SPEAKER: ..... I have got a spare one here, your Honour, if that helps.

PN13

THE SENIOR DEPUTY PRESIDENT: Yes. We will provide you with an opportunity to look at the original from the Commission's file, Mr Hall.

PN14

MR HALL: Thank you.

PN15

THE SENIOR DEPUTY PRESIDENT: Mr Hall, if you look at the document, that is the statutory declaration, all of the pages of that statutory declaration appear to use similar paper. The last page appears to be in a quite different typeface and I am just anxious to clarify that first of all, that is your signature, and the rest of the document reflects the statutory declaration that you signed.

PN16

MR HALL: Yes, I have got no understanding why it has come in a green piece of paper, sir, but it certainly is the exact signature and the same day Pete had signed off on the document.

PN17

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Hall, before we go too much further, I am just wondering whether you might direct the microphone a little closer to you if you are going to remain seated. Our transcript is having difficulty picking you up.

PN18

MR HALL: Okay. How is that?

PN19

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, Mr Fenny and Mr Hall, I am going to address the questions that I have about the agreement to Mr Klitscher. Those questions do not invite the parties to rewrite the document at all. They go to issues that I would like to clarify and matters that I will need to take into account in considering the application. If either of you want to add or detract from Mr Klitscher's responses, please feel free to hop up and do so.

PN20

Can I take it that you have both got copies of the agreement?

PN21

MR FENNEY: Yes.

PN22

MR HALL: We have.

PN23

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Klitscher, can I take you to clause 4.3, which is the extra claims provision.

PN24

MR KLITSCHER: Yes sir.

PN25

THE SENIOR DEPUTY PRESIDENT: Is there a typographical error in that first sentence where the clause refers to claims not being made beyond those:

PN26

contained herein except where inconsistent with the Workplace Relations Act

PN27

MR KLITSCHER: That is a typographical, it should read "except where consistent".

PN28

THE SENIOR DEPUTY PRESIDENT: I see. And if I look at the second sentence, should I understand then that the parties do not intend that the possibility of protected industrial action relative to annualised salaries and hours exists? That is, there will be discussions and an endeavour to reach agreement but the parties do not envisage that that issue could give rise to protected industrial action.

PN29

MR KLITSCHER: That is the intention.

PN30

THE SENIOR DEPUTY PRESIDENT: And if agreement is reached is it the intention of the parties to seek to vary the agreement?

PN31

MR KLITSCHER: Certainly that would be the intention. It is not the company's intention to have an agreement that is certified in this Commission and operating another agreement sub to that without it being approved. So if an agreement is reached, and if the implementation is desired by the parties before the expiration of this agreement, then an application to vary this agreement would be made to the Commission.

PN32

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, clause 5.2 commences on page 5. If I can take you to page 6 and at the bottom of page 6 are references to business teams and safety committee teams. In each of those subclauses there are references to agreed terms of reference and safety key performance indicators. In each case, are those provisions documented, readily available to employees and capable of being changed over the life of the agreement?

PN33

MR KLITSCHER: Yes to all of those, your Honour.

PN34

THE SENIOR DEPUTY PRESIDENT: Thank you. The last subclause in 5.2 exists on page 8. It is headed:

EBA Review Team

The provision of this subclause is such that:

PN35

The EBA review team will continue to meet on a regular basis to review and clarify the content of the EBA agreement.

PN36

Can you explain that provision to me?

PN37

MR KLITSCHER: I suppose in most agreements it is expressed simply as the parties during the life of the agreement will review this agreement in preparation for the next agreement. And that is essentially what this mean; that review team will go through and review the operation of this agreement so that if there are any desired changes they can put them on the agenda for the negotiation of the replacement agreement after the expiry of this one. So that is really what it is, it is the team doing their job, making sure the EBA is fulfilling everybody's desires in respect to the operation of Whyalla.

PN38

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, clause 5.3 is headed:

Workplace Indicators: Productivity Bonus Scheme

The questions that I have about this particular clause fall into a somewhat different category to the earlier questions. I am perhaps struggling a little with this clause in the context of the Electrolux decision and hence require assistance from the parties. If I can refer you to page 9 and to provisions 9 and 11, 9 says that:

PN39

Dollars not paid to the employees at the end of each 12 month period will be refunded to One Steel.

PN40

The question I have there is whether or not you can tell me that that particular provision creates no obligation on a party extraneous to this agreement.

PN41

MR KLITSCHER: Perhaps if I ask Mr Cornish - - -

PN42

THE SENIOR DEPUTY PRESIDENT: Certainly.

PN43

MR KLITSCHER: - - - if he knows the answer, your Honour.

PN44

THE SENIOR DEPUTY PRESIDENT: It might be best if I perhaps before Mr Cornish does answer, if I explain the question I have about 11, which says that:

PN45

United KG and One Steel management representatives will meet on a quarterly basis, will on a quarterly basis conduct audits with employees to confirm the integrity of the overall team efficiency data.

PN46

And again, if that provision establishes any form of binding obligation on One Steel then I will need help from the parties as to how I can consider the agreement in that context. Mr Cornish, if you require - - -

PN47

MR CORNISH: Sir, it is my understanding - - -

PN48

THE SENIOR DEPUTY PRESIDENT: - - - any further clarification of my questions, feel free to ask me.

PN49

MR CORNISH: Thank you. Sir, it is my understanding from the site base management that the way that this bonus scheme has been structured, it is completely separate to the wages increases that are contained within the agreement. The bonus criteria have been established with the assistance of the employee representatives and management from both One Steel and United KG. And because of the contractual arrangements that United KG has with One Steel this bonus scheme is being funded completely by One Steel and so the point 9 that you referred to firstly, sir, and that is that if the performance indicators have not been achieved in essence - perhaps the wording could have been different, but what it is saying, sir, is that if there is no bonus amount to be paid or subsidised by One Steel, then the money is returned to One Steel.

PN50

THE SENIOR DEPUTY PRESIDENT: Yes.

PN51

MR CORNISH: In effect, there - - -

PN52

THE SENIOR DEPUTY PRESIDENT: Mr Cornish, before you go too much further, I will try and clarify the issue that I am raising because your answer is creating an even bigger dilemma for me.

PN53

The agreement is sought pursuant to division 2 of Part VIB of the Act. Of critical importance in terms of that division is section 170LI of the Act, and without reciting that section, section 170LI requires that there be an agreement in writing.

PN54

MR CORNISH: Yes.

PN55

THE SENIOR DEPUTY PRESIDENT: And it is clear that the parties meet that obligation. The agreement must pertain to matters affecting the relationship of the employer and its employees. Now, that is, the employee is to be covered by the agreement. It appears to me on the face of it and on the basis of the information you are providing to me, that the majority of the provisions of this agreement reflect arrangements reached between United KG and its employees.

PN56

MR CORNISH: Correct.

PN57

THE SENIOR DEPUTY PRESIDENT: But that there are some arrangements that reflect a close relationship between United KG and One Steel and hence the involvement of One Steel in matters such as the bonus payment arrangement.

PN58

MR CORNISH: Only on the occasion that One Steel are required to fund it, sir, because of the type of contract that is in operation. It is what we regard in the industry as a fully reimbursable industrial maintenance contract.

PN59

THE SENIOR DEPUTY PRESIDENT: Yes.

PN60

MR CORNISH: And therefore, whilst our employees work as part of a team, cohesively with One Steel employees, this agreement, as you correctly pointed out sir, only covers the United KG component on the One Steel site. However, we are offering this type of arrangement as an addition to our binding agreement and conditions of employment with our employees as an incentive but we require
One Steel to have committed to fully fund the arrangement, which they have done, sir.

PN61

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Cornish, I am not going to take those questions any further unless any of the parties want me to. What I am going to do is to suggest that - I will give the parties the opportunity subsequent to this hearing to ponder upon that particular provision and if they choose to give me something in writing on that issue - I do have to say that I am somewhat at a loss as to how I can consider the provisions of clause 5.3 as reflective of the relationship specifically between United KG and its employees, as distinct from involving that third party, being One Steel. Now, I am adopting that course to give you time to ponder upon what might be a complex issue.

PN62

MR CORNISH: What I would add to it, sir, would be that the agreement will bind United KG and its employees and if our employees achieve the key performance indicator requirements, which will be audited as the document states, by United KG management and One Steel management, United KG will be responsible for funding those payments that are appropriate to our respective workforce. And we are seeking and have sought understanding and commitment from One Steel that they will reimburse United KG, may be a better way of capturing the phrase.

PN63

THE SENIOR DEPUTY PRESIDENT: The issue that I am anxious that you go away and think about, is the extent to which clause 5.3 establishes any binding obligations on One Steel as an extraneous party to the agreement. But as I have said to you, you do not need to answer that question now. You can take it away and talk about it with Mr Klitscher.

PN64

MR CORNISH: I think I would like to add to it, sir. My understanding from the commercial aspect of that contract arrangement is that it is a completely separate commercial arrangement to this agreement.

PN65

THE SENIOR DEPUTY PRESIDENT: Yes. I can only focus on the provisions of this agreement. That is why I am suggesting that you might want to go away and talk about the issue with Mr Klitscher.

PN66

MR CORNISH: Okay.

PN67

THE SENIOR DEPUTY PRESIDENT: And possibly the unions. Mr Klitscher, whilst still on clause 5.3, there is a different category of question relative to subclause 20. It says:

PN68

Any 12 month block which commenced within this agreement will be completed.

PN69

And I am not sure I understand what that means.

PN70

MR KLITSCHER: Perhaps I can refer that to Mr Cornish as well.

PN71

MR CORNISH: Well it has to be the periods for bonus.

PN72

MR KLITSCHER: Really, it is the 12 month qualifier for the bonus and that has to be completed. And it may be that a 12 month block may have started midway through the last year of this agreement. The results of that will not be reflected in this agreement because it - it will be reflected in the next agreement because that's when it ends. So it has got to be completed in 12 month blocks. So if there is a carry over, that is what that means, that it may be carried over to the next agreement.

PN73

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 5.5 relates to safety and health. It refers to a safety, health and environment policy. Should I understand that policy is made readily available to employees?

PN74

MR KLITSCHER: Yes, sir.

PN75

THE SENIOR DEPUTY PRESIDENT: Clause 5.6 relates to learning and development. It references the company and the alliance. Given the title of the agreement and the fact that I cannot find anywhere in the agreement where the alliance as such is defined, how should I understand that reference?

PN76

MR CORNISH: Sir, if I can add to that, the preceding agreement was worded and headed:

The Whyalla and United Maintenance Alliance Agreement

My only comment to that is that it has been a carry over of the general terminology for the regional area. The alliance, what it refers to, sir, is the company and again, the type of industrial maintenance contract that we would provide to One Steel as the client.

PN77

THE SENIOR DEPUTY PRESIDENT: I see. So that in the context of that particular clause the words "company" and "alliance" are effectively synonymous are they?

PN78

MR CORNISH: Yes.

PN79

THE SENIOR DEPUTY PRESIDENT: Thank you. And 5.6 also refers to United KG's training and development procedure, HR44. Should I understand that to be a documented procedure readily available to employees?

PN80

MR KLITSCHER: Yes, sir.

PN81

THE SENIOR DEPUTY PRESIDENT: And one which may be changed over the life of the agreement?

PN82

MR KLITSCHER: Yes, sir.

PN83

THE SENIOR DEPUTY PRESIDENT: Equally, further on in that same 5.6, reference is made to a policy HWSW106. On the same basis, does that reflect a documented policy readily available to employees?

PN84

MR KLITSCHER: Correct.

PN85

THE SENIOR DEPUTY PRESIDENT: Clause 5.7 deals with issue resolution processes. Subclause 7 talks or envisages the reference of an unresolved matter to the Commission:

PN86

in accordance with due process.

PN87

Do the parties intend by that that the Commission first of all, would try to resolve a matter by way of conciliation with arbitration as a last resort?

PN88

MR KLITSCHER: Correct.

PN89

THE SENIOR DEPUTY PRESIDENT: The provisions of 5.8 refer to an employee performance development program. Again, does that reflect a documented program readily available to employees and which may be changed?

PN90

MR KLITSCHER: Yes it does.

PN91

THE SENIOR DEPUTY PRESIDENT: Clause 7 relates to the contract of employment. In 7.1 at the fifth paragraph, again the words:

the alliance

appear. Now should I understand, again, the words "company" and "alliance" are synonymous?

PN92

MR KLITSCHER: Yes, sir.

PN93

THE SENIOR DEPUTY PRESIDENT: And that those safety requirements so referenced are readily available to employees?

PN94

MR KLITSCHER: Yes, sir.

PN95

THE SENIOR DEPUTY PRESIDENT: Clause 8.3 relates to wage rates. It says that:

PN96

The wage rate will be paid for the respective classifications from the first pay period commencing on or after an agreed date.

PN97

What is that agreed date, Mr Klitscher?

PN98

MR KLITSCHER: It is 7 October 2004.

PN99

THE SENIOR DEPUTY PRESIDENT: Thank you. If I can then take you to the wages schedule. I am comfortable with the extent to which I can link the tradesperson classifications contained in this schedule with those in the award. I am comfortable with the extent to which I can link the trades assistant classifications with those in the award. But are you able to tell me either today or at some stage in the next few days how I should reconcile the other classifications with the various award classifications? Just for the purposes of the no disadvantage test. You do not need to answer the question - - -

PN100

MR KLITSCHER: I will prepare to get some instructions on that.

PN101

THE SENIOR DEPUTY PRESIDENT: Yes, you certainly can. Given that I have extended the opportunity to you to come back to me on the issue of the bonus payment arrangement it might be easier to take that as a question on notice, Mr Klitscher.

PN102

MR KLITSCHER: So, if I can just - trades is self explanatory.

PN103

THE SENIOR DEPUTY PRESIDENT: Trades assistant and tradespersons are fairly, patently clear. It is the remaining classifications in terms of the link with the relevant award.

PN104

MR KLITSCHER: Yes.

PN105

THE SENIOR DEPUTY PRESIDENT: Clauses 8.6 and 8.7 just give rise to a question of clarification. Clause 8.6 talks about no further allowances being payable excluding first aid allowance. Clause 8.7 talks about the tool allowance being payable. Should I understand then that what the parties intend is that the rates include all allowances other than first aid and for tradespersons and apprentices' tools?

PN106

MR KLITSCHER: That's correct. That is really - the rate in the schedule is not only a skills rate for the composite weekly rate but it includes any allowances such as hot work, night work, weekend nights, and some dirty work, and that sort of thing. So that they have been rolled into the award rate and therefore - and paid for all purposes I might add and, with the exception of those two which you, sir, have enunciated, first aid allowance and tool allowance.

PN107

THE SENIOR DEPUTY PRESIDENT: Clause 8.8 refers to an assessment and development plan. Again, am I correct in understanding that is a documented plan readily available to employees and which may be changed over the life of the agreement?

PN108

MR KLITSCHER: That's correct.

PN109

THE SENIOR DEPUTY PRESIDENT: Clause 8.10 relates to apprentices. The first and second paragraphs give rise to a further Electrolux based question; to what extent does the sourcing of apprentices from an external group training scheme give rise to employment by the United KG group?

PN110

MR KLITSCHER: Well, it is an understanding between United KG, the unions, and its employees in respect to they can source apprentices in a couple of ways. Now, trades people and all employees see the employment of apprentices as an intricate part of providing tradesmen for the future. And the company and the unions have said, "Well, let's point out that we may not always employ apprentices. We may get them from external sources, but where we do, where we employ them directly, this is what we will pay them". So it is really a part of the HR culture that exists between the employees and the company and the unions. So we say it is a matter pertaining because that subject of employing apprentices is a matter and a subject, particularly in a place like Whyalla, where limited opportunities exists. So that is an integral part of the relationship between the company, its employees and the unions.

PN111

THE SENIOR DEPUTY PRESIDENT: Thank you. Clause 20 relates to United KG drug and alcohol policy. Once again, is the policy referenced in that clause documented, readily available to employees and subject to change?

PN112

MR KLITSCHER: Yes it is.

PN113

THE SENIOR DEPUTY PRESIDENT: Clause 23 relates to right of entry of union officials. Mr Klitscher, as you would be aware, that issue is still subject to consideration as a result of various appeals. The question that I have in that regard - well, and I should say, the approach that I have adopted generally is that it is clear that in certain circumstances, a right of entry provision is quite clearly capable of being linked back as a matter ancillary to other clauses in the agreement. In this instance, can I refer you to clause 23.6 and in particular to the second last line where the words say:

PN114

A duly credited representative of the organisation or the purposes of this agreement.

PN115

Does that reflect a typographical error?

PN116

MR KLITSCHER: It does. It should be "for the purposes of this agreement".

PN117

THE SENIOR DEPUTY PRESIDENT: If I read it as for the purposes of this agreement I am able to determine that that particular provision is ancillary to other provisions of the agreement.

PN118

MR KLITSCHER: Yes. Yes it is a typographical, it should be "for".

PN119

THE SENIOR DEPUTY PRESIDENT: Clause 25 relates to trade union training. Again, I invite you to tell me how I should consider that clause in the context of Electrolux. But in addition to that, I invite you to tell me, not necessarily today but when you respond to the other issue, how I should regard that clause in the context of the Federal Court decision just prior to Christmas in West Farmers.

PN120

MR KLITSCHER: Yes, sir.

PN121

THE SENIOR DEPUTY PRESIDENT: Clause 28 relates to noticeboards. The position adopted by the Commission on noticeboards has varied somewhat. Vice President Ross endorsed a noticeboard provision; in contrast, Senior Deputy President Kaufman did not. So that has led to an approach that I have adopted to say whereby if a noticeboard purpose can be linked back to another agreement provision such that I can find it to be an ancillary provision, I do not believe there is any real question. But I invite you to tell me either now or at some stage in the next few days how I should regard this particular provision.

PN122

MR KLITSCHER: Sir, I would put this to you. The company and its employees and the union regard the noticeboard as one of many communication tools that are in use at the employer's site. And the tie-back to the agreement, how it is associated could well be associated with right of entry. But certainly we see that as part of the overall IR/HR working relationship between the parties to this agreement and this is simply another tool by which communication can take place, which is critical for this type of operation.

PN123

THE SENIOR DEPUTY PRESIDENT: Yes. If you want to add anything to that answer, it is entirely a matter for your discretion. When you provide an additional response to me, feel free to do so. Otherwise, I will take into account the information you have just provided me with.

PN124

Clause 31 relates to income protection. Are you able to provide me with advice as to the amount of the cover?

PN125

MR KLITSCHER: Yes, sir.

EXHIBIT #UKG1 DOCUMENT RELATING TO INCOME PROTECTION

PN126

THE SENIOR DEPUTY PRESIDENT: Mr Klitscher, as I look through this document whereabouts does it talk about the amount of the cover?

PN127

MR KLITSCHER: If you look into clause 31 itself, the policy will contain a weekly benefit, which is a limit - sorry, there is no weekly benefit, it is uncapped. So whatever wages they have lost for their absence will be reimbursed by the policy.

PN128

THE SENIOR DEPUTY PRESIDENT: I see. Is that ordinary time wages? I should say, this question does not give rise generally to a potential to refuse certification, but I can assure you that if the parties end up with a dispute over someone not receiving amounts that they thought were due to them under such an income protection scheme then the capacity exists for the Commission to only sit down with the employer, being United KG, and the employee and/or their representatives. The insurer will not be there because the insurer is not a party to the agreement.

PN129

MR KLITSCHER: Correct.

PN130

THE SENIOR DEPUTY PRESIDENT: That nightmare has been visited on me in the past, which gives rise to the question now.

PN131

MR KLITSCHER: Mr Cornish perhaps can provide some more detail.

PN132

MR CORNISH: Sir, my understanding of how the intended policy claim will work is such that, if I could just digress for a moment and say that the previous agreement contained a provision for income protection which had a ceiling of $1000 per week. We have raised that in a number of our sites around the country to $1500 a week to cater for additional overtime and particularly shutdowns, which attract higher rates of pay and additional penalties. And the Whyalla maintenance site is subject to a number of shutdowns which our employees are involved in, and so we have negotiated with our employees and the unions party to the agreement, sir, to actually uncap that now from $1500 so that my understanding of how the policy will apply with the insurer will be that if a claim is made the average weekly earnings basis will be applied to the amount payable to the individual.

PN133

THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Cornish. And a last question, Mr Klitscher, is of clause 32 and that is salary sacrificing. Reading the first sentence in that clause, it appears clear to me that whilst the salary sacrifice arrangement may provide for salary sacrifice relative to superannuation, which I think is beyond any question as a pertaining, it is not so limited to matters such as that. Now, I wanted to extend to you the opportunity to comment on that issue, including potentially the question of whether or not I should defer consideration of that particular provision until such time as I have some further guidance from the Full Bench. It may be you do not want to answer that part now and want to have a talk to Mr Cornish about it before doing so.

PN134

MR KLITSCHER: Your Honour, this matter is covered by a memorandum of understanding between the company and the unions involved in respect of salary sacrificing. If you are interested in looking at a copy of that memorandum of understanding, we will be happy to pass one up.

PN135

THE SENIOR DEPUTY PRESIDENT: Mr Klitscher, I am in your hands, I will look at whatever you give me. I promise. Mr Klitscher, I note that you have given me a document which appears to be an original. I have not taken your only copy, have I?

PN136

MR KLITSCHER: Yes sir - no you haven't.

PN137

THE SENIOR DEPUTY PRESIDENT: I see. The only relevant section in this memorandum of understanding reads:

PN138

The parties agree the company will throughout the life of the United KG Pty Ltd One Steel Whyalla Mechanical Services Alliance Agreement 2004 shall give reasonable consideration to specific employee requests for alternative salary sacrificing arrangements of pre tax earnings where the employee agrees to pay the fringe benefit tax and after tax earnings are maintained above the minimum wage level and the company does not incur additional charges for the provision being made.

PN139

On that basis I can hand you back that document. I do not need to keep it on the Commission's file. The question still remains firstly as to the determination of that matter is a matter pertaining and secondly, the question of when the matter should be determined given the imminent Full Bench considerations.

PN140

MR KLITSCHER: I am sorry, I do not understand; when should the "matter" be determined?

PN141

THE SENIOR DEPUTY PRESIDENT: Well, the issue of salary sacrificing has already been determined relative to one of the three appeals heard by the Full Bench just prior to Christmas.

PN142

MR KLITSCHER: I am sorry, your Honour, I thought you were asking a question.

PN143

THE SENIOR DEPUTY PRESIDENT: Yes I was, Mr Klitscher. I am wanting to know first of all, whether there is anything further you want to say to me about salary sacrificing and secondly, whether or not you want to comment on the extent to which I should determine that matter now as distinct from wait for the Full Bench's rulings.

PN144

MR KLITSCHER: Sir, let me start off by saying that the manner and the system of payment of wages from the employer to the employee, in our view, is a matter pertaining to the relationship. In fact, you would know, sir, that payment of wages is a subject very, very dear to all of our hearts and it depends on a couple of things, and that is the relationship we have with our employer, and we hope that that relationship is such that we can expect payment for our efforts on a weekly or fortnight or whatever basis. That relationship continues if the employer and the employee have a system or an understanding or indeed an agreement whereby how those wages are paid. We say that is a matter that does pertain to the employment relationship. It is not a matter that would pertain to the employment relationship between One Steel and the postman ..... wages. In this case, United KG pays its employees wages as a result of their contract of employment, their relationship between the employer and employee. So we say that it very much is a matter pertaining to the relationship.

PN145

As to your second question in respect to should you determine it now or wait for a Full Bench decision, we can only remind you, sir, that this is an agreement which employees are expecting to operate as soon as possible and who knows when a Full Bench decision will be handed down. That is very much like the weather, it is unpredictable. Sir, we say that you are able to make a decision on it because we say, and subject to what my friends say, it is very much a matter pertaining to the relationship, the payment of wages, how those wages are treated, what happens to them, what requests an employee makes of the employer about those wages. If that is not a matter pertaining, then we have all been misled all these years. That is all I can say.

PN146

THE SENIOR DEPUTY PRESIDENT: Thank you Mr Klitscher. Mr Fenney, do you want to say anything about any of Mr Klitscher's responses or any of the issues that I have raised?

PN147

MR FENNEY: Yes, if the Commission pleases, just a point I would like to bring up. If you refer back to the index and you go to 15 on the index on the lefthand side of the page, it says:

Long Service Leave

Well, in the agreement I have before me, and I believe it is the same one you have, it is not in there. It was in the one that we signed off on, and then hence all the numbers following are out by one and concluding with salary sacrifice at number 33, whereas the one we have in front of us has 32 written on it. So the long service leave provision is absent from this document.

PN148

THE SENIOR DEPUTY PRESIDENT: Mr Klitscher?

PN149

MR KLITSCHER: Sir, I am in the same boat as my friend, I - in my document clause 15 is not long service leave. In fact, in my document, clause 15 is family, maternity, adoption and paternity leave.

PN150

THE SENIOR DEPUTY PRESIDENT: Yes. I am in the same situation. But I think Mr Fenney is saying that the document that he understood that was put to employees and that was signed by the unions was a different document. Have I correctly understood that, Mr Fenny?

PN151

MR FENNEY: Yes, that's correct.

PN152

MR KLITSCHER: Sir, we will have to get back to you on this to find out what has happened there.

PN153

THE SENIOR DEPUTY PRESIDENT: Yes. Needless to say, Mr Klitscher, if the document that I have before me is not the document that was put to employees and endorsed by employees and signed by the unions then that represents a major and insurmountable impediment to certification.

PN154

MR KLITSCHER: Yes.

PN155

THE SENIOR DEPUTY PRESIDENT: Now, Mr Fenny, let us assume for a moment that this is the document that was put to employees, do you have any comments that you want to make about the responses that Mr Klitscher has provided to me?

PN156

MR FENNEY: No sir, I do not.

PN157

THE SENIOR DEPUTY PRESIDENT: Do you understand that what I am saying to Mr Klitscher is that the opportunity exists, if this is indeed the document put to employees, to provide additional material to me relative to certain clauses?

PN158

MR FENNEY: Yes.

PN159

THE SENIOR DEPUTY PRESIDENT: And the same opportunity operates relative to the AMWU to do so either in its own right or in concert?

PN160

MR FENNEY: Yes I do.

PN161

THE SENIOR DEPUTY PRESIDENT: Yes. Mr Fenney, are you Whyalla based or Adelaide based?

PN162

MR FENNEY: I am Adelaide based. I am just ..... five minutes.

PN163

THE SENIOR DEPUTY PRESIDENT: That is all right, thank you. Mr Hall, your position on this matter?

PN164

MR HALL: A party to the agreement, sir.

PN165

THE SENIOR DEPUTY PRESIDENT: Do you agree that this is the agreement that was put to employees or are you not sure on that question?

PN166

MR HALL: I do not believe this is the agreement - - -

PN167

THE SENIOR DEPUTY PRESIDENT: With particular regard to clause 15.

PN168

MR HALL: I do not believe it is the agreement that was put to employees.

PN169

THE SENIOR DEPUTY PRESIDENT: I see. All right. Now, Mr Hall, you are Whyalla based, are you not?

PN170

MR HALL: That's correct.

PN171

THE SENIOR DEPUTY PRESIDENT: All right. And you understand that if the parties did establish that this was the agreement that was put to employees that the AWU also has the opportunity to comment on those additional clauses?

PN172

MR HALL: Yes, sir.

PN173

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Klitscher, what I am going to suggest is that the parties engage in some discussions as soon as practicable to determine whether or not this was in fact the agreement put to and endorsed by employees and signed by the unions. If it is agreed that that is not the case, then the process will need to be repeated.

PN174

MR KLITSCHER: Yes, what we will do, your Honour, if the agreement you have is not the agreement which the employees voted on then we will withdraw this application and as you say, repeat the process.

PN175

THE SENIOR DEPUTY PRESIDENT: All right. Now, let us just pursue that a little further. If you end up having to do that, Mr Klitscher, and file a new agreement which is fundamentally the same as this with the exception of the missing clause and any other particular provisions you wish to address, in that regard I have in mind the amendment of typographical defects to which we have referred, and other such provisions, then the opportunity exists for the parties to file both that new agreement, new statutory declarations and also advice to the effect that they want to rely upon the material or information provided to me today. In which case I will endeavour to consider that additional material in concert with the information provided today and try and avoid the need for a further hearing.

PN176

MR KLITSCHER: Sir, I have - in fact my client, Mr Cornish has his copy of the agreement which is signed by all parties, and I give it to my friends to have a look at, which we believe is the correct one. So that there has been an agreement signed by the parties. The reason I am raising this, sir, is if there is an agreement which, subject to my friends recognising it as the document they signed and in the order that was voted on by the employees, there is probably not the need for us to go through the process again but simply to perhaps supplant that to the Commission.

PN177

THE SENIOR DEPUTY PRESIDENT: Well, Mr Klitscher, I will need
advice - - -

PN178

MR KLITSCHER: I am in your hands, yes.

PN179

THE SENIOR DEPUTY PRESIDENT: I will need advice from the two unions, that is written advice, to the effect that they agree - I will wait till the unions have finished looking at the document.

PN180

Mr Fenney and Mr Hall, if indeed following consideration of this document you agree that this is the document that was put to employees and that was endorsed by the employees and that was then signed by the unions, then I will need advice from both of your unions to that effect, given the question that has been raised. If it is not, then I will wait to receive a new application and work on the basis that I have already outlined to Mr Klitscher, such that if the parties want to rely on the material that has been put to me today together with any additional materials that they may want to put, I will endeavour to avoid the need for a further hearing.

PN181

I should say, Mr Hall, if there is to be a further hearing we will make sure you have the opportunity to participate by video link if you choose to do so.

PN182

MR HALL: Thank you, sir.

PN183

THE SENIOR DEPUTY PRESIDENT: Now, if the parties agree and advise me that this is the agreement that was endorsed - - -

PN184

MR KLITSCHER: I am sorry, sir, which agreement are you talking about? This agreement, which one are you referring to?

PN185

THE SENIOR DEPUTY PRESIDENT: I only have one, Mr Klitscher.

PN186

MR KLITSCHER: Okay.

PN187

THE SENIOR DEPUTY PRESIDENT: I have the agreement about which I have been asking questions.

PN188

MR KLITSCHER: Yes.

PN189

THE SENIOR DEPUTY PRESIDENT: Where clause 15 of that particular agreement relates to family, maternity, adoption and paternity leave.

PN190

MR KLITSCHER: Sir, is that an agreement which appears to be an original?

PN191

THE SENIOR DEPUTY PRESIDENT: It does indeed, Mr Klitscher. But I should also say that Mr Fenney is correct; in that the contents section of that agreement is inconsistent with the body of the agreement itself. Now, I cannot explain that. It is inconsistent in that the contents clause[sic] contains reference to a clause 15 being long service leave.

PN192

MR KLITSCHER: I understand that.

PN193

THE SENIOR DEPUTY PRESIDENT: Yes.

PN194

MR KLITSCHER: It was what you said later I did not understand. I understand that the clause 15 in one document is not the same as clause 15 in another document.

PN195

THE SENIOR DEPUTY PRESIDENT: Well, let me be absolutely clear. I only have one document, Mr Klitscher.

PN196

MR KLITSCHER: Yes.

PN197

THE SENIOR DEPUTY PRESIDENT: I can only tell you what I have and what I am saying is that I have a document which has a contents page which indicates that clause 15 relates to long service leave.

PN198

MR KLITSCHER: Yes.

PN199

THE SENIOR DEPUTY PRESIDENT: Clause 15 of the document that I have though relates to family, maternity, adoption and paternity leave. Now, if the parties advise me that that is the document that was put to employees and that was endorsed, then I am happy to consider that document and any other additional material that is provided to me consistent with the questions that I have asked today, over the next two week period. If the information is provided to me at an earlier time, I will endeavour to look at it at any earlier time. Now, does that establish a foundation upon which we can proceed for the future, Mr Klitscher?

PN200

MR KLITSCHER: I must have missed something, sir. I understand what you have got in front of you, because it is the same as what I have got, because I have kept a copy of what I filed in the Commission.

PN201

THE SENIOR DEPUTY PRESIDENT: Yes.

PN202

MR KLITSCHER: I thought it had been established that my friends said that that is not the document that the employees voted on and indeed they signed.

PN203

THE SENIOR DEPUTY PRESIDENT: Well that is a question that the parties will need to consider. It is not a question I can answer at this stage, Mr Klitscher, given the question that has been raised by the two unions. It is a matter that they will need to discuss with you and they will need to provide advice to me about. Mr Fenney?

PN204

MR FENNEY: Just to comment on that, the copy that I have is one where they have voted on, is the one that you do not have, is the one that when we went through the process in Whyalla I actually brought them back in the vehicle with me and got them signed and then took them over to United KG's office. Now that is the one that I have in my hand which you do not have present in front of you today. It has - missing on it is a signature for the AMWU because I brought it back - everybody signed off on it in Whyalla, I brought it back to be signed off by John Greissly for the AMWU and then I took it over to United KG's. Now, the copy I have now in my hand is the one that I brought back.

PN205

THE SENIOR DEPUTY PRESIDENT: Yes. Well, Mr Fenney, what I am suggesting is that that issue is one that the two unions will need to put their heads together on and presumably talk with United KG about. I will then require advice from you if indeed you are saying that the - or changing your position such as to say that the document that I have is in fact the agreed document. If I do not get that advice I will have to work on the basis that you are saying to me that the document that I now have is not the document voted upon by the employees.

PN206

MR FENNEY: That's correct.

PN207

THE SENIOR DEPUTY PRESIDENT: Thank you. Now, are you happy with that approach, Mr Fenney?

PN208

MR FENNEY: Yes, sir.

PN209

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Hall?

PN210

MR HALL: Fine with that, sir.

PN211

THE SENIOR DEPUTY PRESIDENT: Very well. I will adjourn the matter on that basis.

<ADJOURNED INDEFINITELY [10.25AM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #UKG1 DOCUMENT RELATING TO INCOME PROTECTION PN125