C2004/3156, Transcript of Proceedings [2005] AIRCTrans 520 (1 March 2005)

1800 534 258

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 10538

SENIOR DEPUTY PRESIDENT DRAKE

C2004/3156

s.99 - notification of an industrial dispute - log of claims

Construction, Forestry, Mining and Energy Union
and
A C Whalan & Co Pty Ltd
(C2004/3156)

SYDNEY

10.02AM, THURSDAY, 17 FEBRUARY 2005

PN1

THE SENIOR DEPUTY PRESIDENT: Good morning, Ms Gray.

PN2

MS GRAY: Good morning, your Honour. Mr Herbert is only seconds behind me.

PN3

THE SENIOR DEPUTY PRESIDENT: Yes, that's all right. Don't worry,
Mr Moy?

PN4

MR MOY: My apologies, your Honour.

PN5

THE SENIOR DEPUTY PRESIDENT: That's all right.

PN6

MR MOY: I was watching the clock outside. It's slow.

PN7

THE SENIOR DEPUTY PRESIDENT: It's a bit of a change for me. I thought I would be on time and shock you all. Mr Moy, I didn't mean to cause you any anxiety checking on those submissions. I was just making sure there hadn't been an update since 3 February that I missed, that's all.

PN8

MR HERBERT: That's fine, your Honour. Can I take it that your Honour has the written submissions that were made on 3 February?

PN9

THE SENIOR DEPUTY PRESIDENT: Yes. Yes, I was only checking to see if there had been any update, that's all.

PN10

MR HERBERT: Yes, thank you. Your Honour, I think the accepted position seems to be my clients object to the jurisdiction, that we make out that objection first. Is that - yes, your Honour.

PN11

THE SENIOR DEPUTY PRESIDENT: Yes, that's what I was expecting.

PN12

MR HERBERT: Different members of the Commission have different practices about things like that, your Honour. Your Honour, the position obviously taken by Harnischfeger in relation to this matter is as set out in the outline of submissions. Since those submissions were filed there has been a substantial written submission filed by the CFMEU in which there has been an examination of a long history of the case law, in the High Court and elsewhere, which has gone to the question of the High Court, Federal Court, Commission and Coal Industry Tribunal decisions in some detail and, your Honour, from that analysis it appears that the submission is made that the current trend if you like, or a developing trend of cases appears to suggest that the earlier cases which are firmly in support of a position adopted by Harnischfeger are able to be distinguished or are no longer supported by respectable authority.

PN13

Your Honour, can I say that firstly about that broad thrust of the submission, that the position articulated in the earlier High Court authorities upon which we rely has not changed and it certainly has not changed by reason of what is said to be in the written submissions an evolution of work practices within the coal mining industry, for example, and it is put in the written submission, although there is no evidence from any of these matters, but in the opening parts of the submission it is put that there has been in the first half of what is said to be this century, I think should be last century, the majority of coal mining was done directly for coal proprietors by contract coal miners, individuals were paid to do various things.

PN14

But since then contracting out by coal miners has increased enormously over the past decade and it is said, as I understand the submission, that that work practice within the coal industry has had some impact upon the way in which the rules of the CFMEU ought to be interpreted. With respect, that is not so and cannot be so. The correct position is that the rules of the CFMEU, they were made in terms which conferred upon the CFMEU particular entitlements of a very broad nature in one respect, but of a very confining nature in another respect. The CFMEU has over many years, many decades and its predecessors, taken advantage of the breadth of that rule in many respects.

PN15

However, as was said very early on in the history of these matters and we have mentioned the passage in Hibble's case in paragraph 12 of the written submission on behalf of Harnischfeger, that the fact of the matter is that the CFMEU has chosen to have its eligibility rule framed in a particular way and having, as it were, made its bed, it must lie in it. To the extent to which there are limits imposed by a rule of that kind, then they must accept those limits, just as they are entitled to benefit. The benefit of a rule of that kind is that - if phrased in that way, by reference to the employer's industry is that so soon as one demonstrates that the employer in question is engaged in or in connection with the industry, then the union concerned is entitled to represent the industrial interests of effectively the whole of the relevant workforce.

PN16

One doesn't need, for example, to demonstrate that the particular employee concerned is engaged in the mining of coal, and there are many examples in circumstances where the CFMEU is entitled to represent the industrial interests of workers who have absolutely nothing to do with the actual winning or processing, or dealing with coal, simply by virtue of the fact that the employer of employees is engaged in the industry. Whether they do so or not, the CFMEU is entitled to represent the industrial interests of all of the clerical administrative employees of a coal miner and a range of other employees who are engaged in mechanical and other works who are employed by an employer engaged in that industry.

PN17

That is the benefit of a rule which is expressed in terms that encompasses the whole of the employer's - or that is expressed in terms whereby the eligibility rule operates in accordance with the nature of the business of the employer, it allows the union to represent all of the employees under that employer's umbrella. The downside of a rule expressed in these terms is that unless on the substantial characterisation test the employer can properly be said to itself be engaging in the industry, then the CFMEU have no rights of representation even if individual employees may themselves be engaged in work which is very similar to work which is done by coal mining companies and which is otherwise the subject of CFMEU coverage.

PN18

If one has a person in accordance with, for example, Hibble's case, the activity in question was the conversion of coal into coke, which was in fact something which was done by coal and coke companies and was considered to be part of the relevant coal industry. If the conversion of coal into coke however is done by a company involved in another industry, even though it was exactly the same activity, it was held not to be within the industry because the employer's business was in the iron and steel industry, not in the coal and coke industry.

PN19

So that if the eligibility rule of the union was expressed in terms of the vocation of the employee, that is, all persons engaged in the employee's activity of the digging of coal or the conversion of coal into coke, it wouldn't matter where that activity was being carried on. So long as the employee was carrying it on the CFMEU has eligibility rights, if however the union chooses to adopt an eligibility rule by reference to what is the fundamental business of the employer As I say, it has great breadth under the umbrella of that employer, but it is extremely confined because it does not run with the vocation of the employee.

PN20

Here one detects very strongly that the argument is put by the CFMEU that they are entitled to have it both ways, that they are entitled to represent all of the employees of a coal mining company, for example, but they are also entitled to follow the vocation of the relevant employees into the business of other companies, companies which are firmly placed in other industries, and to represent those employees by virtue of their vocation, not by virtue of the business conducted by that employer. And they appear to say that because the coal mining companies have ceased carrying on that kind of work for themselves and have engaged the specialist services of other companies whose core or fundamental business is the provision of the service of the relevant kind.

PN21

Now, the cases are replete with references to say that if a coal mining company provides its own catering service, then the cooks and the bottle washers are engaged in the business of the mining company because they are engaged by a coal miner. If however the coal mining company, or the metal mining company, as the case may be, engages a catering contractor, then the same cooks and the same bottle washers, in the same kitchen, in the same crib rooms, are not engaged in that industry because of the identity of their employer and because of the core business of their employer. But the test is what does the employer do, not what does the employee do.

PN22

Presumably we wouldn't be here if the employees weren't doing what they do in the vicinity of a mine. This issue would not arise, but it's obviously not a matter which is of determinative weight as to where they do what they do. The question to be determined is whether doing what they do, for example, in this case on a coal mine, does that then designate the business of the employer as being in or in connection with the industry.

PN23

The only way in respect of which that can be determined going further into the submissions, but the only way that that can be determined is to take an overall view as to the substantive characterisation of the business of the employer and as in this case, where there are employees of the employer who perform their daily work on or about a coal lease the question has to be asked why, as a matter of fact, are those persons on that coal lease, in what context are they there, how does one characterise their attendance and what is the purpose to be served from the employer's perspective of having those employees on that site.

PN24

If one takes an extreme case, as those, it seems to me, often offered up in the examples that one appears in the seasonal cases, if one takes the extreme case of Telstra, for example, if Telstra were to have a designated employee or three, situated on and about coal lease to deal with the telecommunications infrastructure in and about the coal mining area, one could hardly say that Telstra have thereby engaged in or in connection with the coal industry. Telstra is and remains a telecommunications company and is nothing else.

PN25

An employee who attends at work every day of the week at switchgear or facilities, or aerials, or other telecommunications equipment, stationed on and about a very large coal mine, even though they work every day on a coal lease, even though the telecommunications equipment is substantially, if not totally, utilised by coal mining companies and the whole of the reason for them being in that place and the whole of the product of their work is of and for and by used by coal companies, that does not designate that the employer, Telstra, has been engaged in or in connection with the coal mining industry.

PN26

It may be fundamental to the radio and telephone communications such that the mine could not operate without them and the actual miners could not operate without that equipment, that still does not have the effect as a matter of fact and as a matter of degree of thereby constituting Telstra as a company engaged in or in connection with the coal mining industry. It then becomes an analysis of the proper facts as to at what point one departs from that obvious situation that almost goes without saying to designating another particular employer who provides services to the coal mine owner or operator as to at what point they cross the line from being obviously not engaging in or connection with their customer's industry and becomes an employer who can be properly characterised as a participate in the industry, as opposed to a service provider to the industry, which seems to be the relevant point of discrimination.

PN27

You have been taken to a lot of cases in the CFMEU submissions and I have also referred to a number of the cases, but can I point up one particular critical common feature in the cases. The cases to which you have been referred it must be conceded I think on all sides of some assistance, although great care needs to be taken in relation to comparing the facts of one case to the facts of another case. The High Court decisions purport to expose principles that can be applied, but having exposed the principles they are then in each case supplied to a particular set of facts and the Justices in each case were very careful to say applying those principles to the particular facts of this case the following conclusion is reached.

PN28

So comparing facts with facts is a very difficult and sometimes a dangerous thing. But can I say that the one critical common feature in all of the High Court cases in particular to which you have been referred is that there has not been one decision which has found as a matter of fact that the provider of a service to a coal mining company, that is, repairing equipment, providing a transport service, providing a catering service, anything of that kind, not once has a service provider of that kind been found to be engaging in the industry by providing that service. The transport operators, for example, have been found to be, in Hickman's case, have been found to be outside the general transport industry and not in.

PN29

Poon Bros, the caterers were found to be in the catering industry and not in the mining industry and so on. The contractors in each case, the contractors who have been found to have engaged in the industry, in or in connection with the industry, are only in the cases of the metalliferous mining industry and uranium, bauxite, etcetera, iron ore. In each case they were contractors who were building the mine, or building the mine infrastructure, the service equipment, etcetera, for the purposes of operating the mine. The fixed plant and equipment, everything that is - and they have come onto the mine, worked under construction contracts to build the mine in effect.

PN30

Now, in each case they are contractors who are building substantial, either digging the mine itself and doing the preparatory earthworks and building the actual mine itself and the mine infrastructure. They were argued to be involved in the construction industry and in the metalliferous mining cases it was said, well, there is nothing more closely related than the mining process than the building of the mine itself. But they build the mine and leave as a construction exercise. The only part of any business which was considered for the purposes of those cases was the work of the project engineers or the construction companies, or something of that kind, who were coming in to build the mine.

PN31

In none of those reported cases has a factual situation similar to Harnischfeger been looked at other than the cases of the Thiess Repairs case, the Poon Bros case and Hickman's case in relation to the transport operators. That is, people who have substantial business operations outside the mine but who come onto the mine to provide a consumable service and not actually build the mine and then go home. So there is not one of the High Court decided cases, or any indication within those decided cases that the provider of a consumable service of the kind provided by Harnischfeger, that is the sale of movable plant and equipment and the after sales service in relation to that equipment, has itself been characterised as being an activity in or in connection with the industry of the customer.

PN32

More particularly, where the company concerned has a substantial manufacturing operation well away from any mine site and where it provides effectively the same equipment to a range of different types of mines and a range of different types of miners, such that it could be said that it distributed its product widely, and one of its customers is the coal industry, or are coal miners or coal operators, others of its customers are operators in a number of other different industries. On no occasion has there been a determination in any of the High Court decisions which would assist towards a conclusion that a service provider such as Harnischfeger is itself thereby by the provision of that service, engaged in an industry.

PN33

As I say, it's either been a case of the construction of the actual mine, hard digging or actual mine infrastructure, buildings on the ground, things of that nature, all of that work has been found to be absolutely inherent in the nature of the mining operation because you bind the product unless you build the mine, but as I have submitted, not one of the cases indicates that the provision of a service of this kind is of itself constituted the employer as engaging in the industry. And that's instructive in my submission because the CFMEU are seeking now to open a brave new world in relation to the extent and scope of the eligibility rule.

PN34

One thing is clear and it seems to be a matter in respect of which the CFMEU quite understandably is shying away from and that is that a point that we have made in our written submissions at paragraph 11 of the written submission, that in Hibble's case, and unless Hibble's case is or has been overruled in this particular respect, it must remain the legal position so far as authorities are concerned. What Hibble's case said in a passage which is quoted after paragraph 11 of the written submissions, that the effect of this particular rule with which they were dealing in its earlier emanation, is that:

PN35

If the employer is engaged in or in connection with a specific industry, all of the employers and employees are engaged in or in connection with that industry.

PN36

And there is a quotation in the case which says just that:

PN37

Some employers extract coal from the earth and convert some of it into coke and distribute both coal and coke to consumers. Such a business would in point ...(reads)... in connection with that industry.

PN38

Now, in those circumstances, if it be interpreted that the CFMEU rule applies to Harnischfeger because it supplies plant and equipment, movable plant to the mining industry, or to the coal mining industry, and services that equipment in-situ because of the size and the nature of that equipment that it's inconvenient or not practicable to move it from that site, that all persons engaged in that business are eligible to be members of the CFMEU. Well, one asks then rhetorically where does that stop, because the business of Harnischfeger is the provision of that plant. All persons engaged in that business, if the provision of the plant, the manufacture, design and construction and provision of that plant is the business of Harnischfeger, as it uncontrovertibly is, then all persons engaged in that business are eligible to be members of the CFMEU in accordance with their rule, if the performance of that business in association with the coal industry renders that employer engaged in or in connection with the coal industry.

PN39

Their eligibility runs back up the road to cover the manufacturing, design process. The factories at Bassendean in Western Australia, the factories in Queensland, the electronics workshop in Hemmant, the workshop in Mackay, the vast majority of whom never touch anything that ever goes to a coal mine, none of them ever effectively go to a coal mine or have anything to do with the coal mine. The products that they make go to a coal mine in some cases, but in very few cases in relation to some of the factories, but beyond that they have no connection whatsoever with the coal industry.

PN40

But in accordance with Hibble's case, if Harnischfeger is by the provision of that equipment engaging in the coal mining industry, all of its employees thereby become eligible to be represented by the CFMEU. Now, that is the vice, if I can say, of the interpretation put forward by the CFMEU. They say in the course of proceedings but in practical terms we only want to cover these people who come onto the coal mine. But it doesn't stop there because the way in which they cover those people is to say, well, the employer is engaging in the coal industry, in accordance with our rule we are entitled to represent all of the employees of the employer.

PN41

Now, that is why very great care and caution needs to be taken before one extends an employer eligibility rule in that way and Harnischfeger is a classic case. If Harnischfeger supplies mining equipment to the coal industry and supplies mining equipment to the metals mining industry and to the quarrying industry, et cetera, et cetera, et cetera, then on a similar principle its employees become eligible to be represented by a vast range of overlapping unions and overlapping union coverage.

PN42

If they are to be taken to be engaging in the industry, or in connection with the industry of each of their customers by dint of the fact that they provide equipment, very large equipment but movable equipment nonetheless in each case, and provide personnel to service that equipment as part of the maintenance contract as part of making the sale more attractive that those personnel are provided on site, if the after sales service and the manufacture of that after sales service and the provision of that equipment is in connection of the coal industry, then the manufacture of the equipment which is sold and being serviced must necessarily be connected, be done by the same employer in relation to the same equipment, being antecedent activity to the sale of the servicing, an activity which only exists because of the sale and servicing, on the Argyle diamond mine principle, all of those activities being connected one after the other, they are all in connection with the coal industry.

PN43

But they are also all in or in connection with the metals mining industry, bauxite industry, gold, copper, aluminium, wherever they happen to sell this equipment, they are in connection with all of those industries at the same time and therefore all of their employees are all eligible to be members of all the unions that cover all of those unions; despite the fact that all they really do is manufacture the stuff and send it out to their respective customers. Now, as I say, the vice of the CFMEU eligibility rule in this respect is the extent to which it can, if interpreted the way it has been suggested, run up the rope to cover the employees of a range of industries, the employees of employers who operate so far as their core business is concerned, in a range of industries which have effectively nothing to do with the coal industry.

PN44

We have given the examples in the written submissions of the sorts of employment and we have given the references to the evidence of the sorts of employment and employees who, on the face of the CFMEU application, are and would be covered by, or potentially covered by this application. In paragraph 17 we have given the evidentiary references. It currently engages 370 employees. The material is all set out in exhibit H2. Those employees are to be found scattered around Australia in all sorts of places. In paragraph 21 the point is made that the operation of Harnischfeger are not confined to service equipment used in coal mining operations. It includes the services of general industry, iron ore mining, copper and gold mining, bauxite mining and diamond mining.

PN45

It provides electrical engineering services to general industry, with little or no involvement in any mining activities. Its interaction with the coal industry is confined to the fact that the coal industry happens to be one of the many consumers of the equipment manufactured, distributed and serviced by the company and provides a service to the coal industry. Now, in paragraph 22, the fabrication of a machine shop at Bassendean near Perth that employs 86 people. No employees are engaged to or actually do perform work on coal mines in Western Australia, but on the principle of the interpretation of the eligibility rule put forward by the CFMEU on these proceedings, all of those 86 persons at Bassendean in Western Australia become eligible to be represented by the CFMEU under this rule if, as appears to be the case, they are involved in the manufacture of equipment which is sold and serviced to coal mines, or a metal mine.

PN46

That eligibility might wax and wane on a daily basis depending on what job they are doing, or on a monthly basis or yearly basis, depending on the size of the contract they might have for a particular mine. But on the principles which are put forward by the CFMEU in these proceedings based on the reasoning in the Argyle mining cases and uranium mining cases, all of that connectivity as between the manufacturer of the item which is being sold and serviced would be such that all of those persons would be as a matter of fact engaged in or in connection with the coal mining industry and able to be covered by the CFMEU. And one would have to say what a cataclysmically difficult situation would be created in terms of industrial demarcations in this country were a rule of this kind interpreted in the way that gave the CFMEU the ability to chase the workshops of all of the suppliers to the industry, or any major supplier to the industry that provides equipment.

PN47

It would allow on this principle, the principle that's put forward, if the local Toyota dealer supplies 25 Land Cruisers and sends a mechanic out there every week to service the Land Cruisers on the mine site, to service the light vehicle fleet, it would mean that effectively Toyota or the Australian emanation thereof would thereby engaged in or in connection with the coal mining industry, as would the manufacturers of those Land Cruisers. If Toyota becomes engaged in or in connection with the industry because they provide the light vehicle fleet that allows everybody to get to their equipment and allows all the surveyors and everybody else to get around and they send a mechanic out to service them because there are so many of them on the one location as part of the warranty servicing arrangements, in that situation which is absolutely indistinguishable from the Harnischfeger situation, those vehicles, as you will see from the inspections, I used Toyota as an example, I think a lot of them are probably Nissans, but whatever the case may be; the four wheel drive manufacturer who dealer who provides 20 or 30 at a time to a mine site would be in precisely the same situation as Harnischfeger so far as the provision of cutting edge equipment is concerned because those vehicles are an inherent tool by a significant proportion of the workforce which one sees out in the field everywhere.

PN48

There would be no end to the ability then of the CFMEU to seek to obtain eligibility and coverage of the workforce of Toyota, and so on and so on. Now, it might be said, but we don't intend to try and cover Toyota, they're too big or they're too far, or they're too something, but the principles concerned are exactly the same. It's the provision of movable plant by a manufacturer to a business which uses their plant for their own purposes. The important thing is that Harnischfeger in this situation, as does Toyota, does not in that sense dig a greater hole for itself. It doesn't wash any coal. It doesn't transport any coal. It doesn't sell any coal. It has nothing to do with the coal operation per se in respect of the plant and equipment which is sold and serviced or leased and serviced on the site.

PN49

It is Toyota again has nothing to do with that process. They have a very large manufacturing base off site where they manufacture this equipment for a lot of different people. They put a very small proportion of the workforce onto the site and the reason why that workforce is on the site is not to become involved in anything to do with the mining company's business as such, but to service the equipment that Harnischfeger sold or leased. Instead of sending it back to their Harnischfeger premises to service and doing it in-house, because of the size and the extent of it, Harnischfeger send its people out to the site. It's better to take Mohammed to the mountain rather than the other way round.

PN50

So that the context and the reason why the employees of Harnischfeger are on the site isn't because they want to become involved in the mining process in any way, but because it's unwieldy to take the equipment back to be serviced at its point of manufacture. If the equipment was again of the size of say a four wheel drive and it was quite capable or even smaller, quite capable of being posted or couriered or put on a truck and sent back to a workshop in a nearby coastal town, we wouldn't be standing here. There would be no case made because the equipment would have been sold from a remote location into the mine. It would be taken away and serviced back on the coast and one would surmise the CFMEU would not then take the supplier of equipment of that kind as being involved in the industry.

PN51

If one takes the example of the computers in the mine office, for example. One assumes that if the computers break down they put them in a box and send them back to wherever they came from to have them serviced and repaired, rather than bring a repair person out to the mine from Brisbane or wherever. But that equipment, small equipment, portable equipment of that kind is more conveniently sent away than it is serviced on site, which essentially brings one down to the question as to whether the fact of the servicing of this equipment being performed in-situ, does that make such a material difference to the employer of those employees, that if the equipment in effect is serviced on site, that the employer is engaging in the industry?

PN52

If the equipment is serviced off site, back where it was manufactured, sent back to Bassendean or Hemmant or Mackay, then that same employer does not engage in the industry, notwithstanding that the result for the miner is the same. The equipment arrives in good order and condition. When it breaks down they send it away, or when it breaks down it is fixed. So that ultimately the determination of this matter would seem to be based upon a factual assessment of whether the placement of employees for the servicing on site of the equipment that has been sold or leased for the mine is of itself sufficient to convert the employer from an employer who is engaged in its own metal manufacturing business to an employer who is engaged in two businesses.

PN53

That effectively seems to come down to a question of the size and the mobility of the plant provided. If they were small electronic gadgets such as the GPS, the global positioning system units that are used throughout the mine as a surveying locating aid for mapping purposes throughout the mine and for the location of various features of the mine. If it was a handheld GPS or a small item of that kind which could be serviced by sending it back to its supplier, then the company that supplied them and took them back and serviced them in Brisbane or Sydney would not be engaging in or in connection with the industry. But if the equipment is so large that that can't happen and the employees are sent out there to do the work, then that company is engaging in the industry.

PN54

One would have thought as a matter of ordinary industrial sense that a question of great seriousness in terms of whether the union can or cannot represent the industrial interests of the employees would not be determined by reference to the size of the equipment being supplied, which seems to be the point that is made. If the equipment is big enough and unwieldy enough and can't be taken off site so the service will have to come on site, you are in the industry. If it's small enough and portable enough that you can send it back to Brisbane you are not in the industry, is the point that seems to be made.

PN55

Again it doesn't matter, if one were to go back, for example, to the situation where picks and shovels were used, and one assumes occasionally shovels and implements of that kind are used, and a supplier sends 1000 shovels to a mine, but because it's small and portable, if they bend or break or need repairing or something , they don't send a serviceman out there, they send them back. Now, you couldn't get any closer to the heart of the matter than a shovel in terms of the mining operating, or any other similar portable equipment used by mining companies and I have mentioned GPSs and things of that kind, but we don't see cases of the suppliers of that kind of equipment being alleged to be persons who are engaging in the industry.

PN56

The fundamental difference seems to be whether or not the employees of that company show their faces on the mining lease or not, without a proper examination as to the reason why they are showing on the mining lease, and it comes down to that, in my submission, that fairly simple fact. In the cases that you have been referred to, the deal with the construction of the mine and the fixed mine infrastructure, there can be no doubt that there simply is no way to do that work other than to work on the mine because you are in fact building the mine and that there is no element there that could really contradict the assertion that by going onto the mine and building the mine you are thereby participating in the industry.

PN57

Here and in the cases of the providers of services, in many cases to which you have been referred or in the number of cases to which you have been referred in respect to which a service has been provided, in each case the service provider has visited on the mine site and has carried various activities on the mine site, be it transport, vehicle repairs or catering, and in each case where they have done so, even though they have been present on the site, it has been held that they were not thereby engaging in the industry. In circumstances where the only reason why there has been a visit to the site there is no other necessity for the employees of this company to visit the site other than to service the equipment they have sold or leased, one would have to say that the situation is more remote again than it was in the case of Poon Bros, for example, where the employees literally carried out their work on the site because it was part of the structure of what was going on within the mining operation.

PN58

So that the facts and circumstances of Harnischfeger in relation to the provision of plant and equipment are one step removed from the facts and circumstances of the cases that have already been determined, and as I say, in the case of service providers it has been determined that as a matter of fact, accepting that all matters turn on their own facts, but in each case to which you have been referred, in the High Court as a matter of fact service providers of the kind that we are dealing with here have not become involved to the requisite extent in the industry, in or in connection with the industry of their customers. It is a very, very large step indeed for the Commission to rule that a service provider of this nature because they send their maintenance employees onto the site to maintain the equipment that they provide, that the manufacture of that equipment thereby becomes involved in the industry of their customer.

PN59

The CFMEU would have the Commission believe that that this is simply running a rope around territory where the CFMEU has always lived and this is just making some small adjustments at the boundaries to ensure that the CFMEU retains the coverage it has always had. Can I make one point very clear, that is not true. The CFMEU is not asking the Commission to adjust the boundaries very slightly to ensure that they continue to cover the territory they have always had. The territory that they have always had has been the workforce of coal mining companies. Harnischfeger is not a coal mining company. It never has been and on the face of it, never will be.

PN60

Its revenue base, its income, its entire reason for being, is based upon the manufacture and sale of equipment to the mining industry generally. It does not have access to the revenue stream generated by coal mining as an activity. It must compete with machine manufacturers both throughout the world, this being as it appears a world based industry, and they must be able to build equipment on a basis which is competitive with the prices which are charged for that equipment across the board. That is, for coal mining, metal mining, gold, copper, bauxite, iron ore. They don't conduct the business which sits within the coal industry and the CFMEU has not ever on the face of matters been able to utilise this rule to extend out into the workshops and out into the businesses of the equipment suppliers to that industry.

PN61

For a very long time coal miners did a lot of these functions themselves, not the manufacturer of their own equipment. They have done a lot of the maintenance and servicing of their own equipment. They took that role for themselves and you have seen evidence about that. They have now surrendered that role somewhere else, as a result of which, in my submission, the coverage of that work has left the umbrella of the CFMEU because it has now been handed over to the participants in a different industry and it doesn't matter whether the participants in that different industry, that is, the metals manufacturing industry, come back into coal mine to apply their trade in some very limited respect.

PN62

It is not thereby converted to the mere fact that that work is to be performed on a coal lease. That work is not thereby converted for industrial purposes into work which fits within the ambit of the CFMEU rule. At this point can I make remake the point which I hope has emerged from the submissions and that is that the eligibility rules of unions perform a particular function within our industrial system and must be interpreted having regard to the role and the function that they perform. They are intended to demark or delineate. They have been set over the years with an eye and a view to maintaining particular spheres or areas of influence for particular unions and generally speaking with a view to minimising the potential for conflict between those unions and establish spheres of influence and coverage have settled over the very many years that these rules have been in existence.

PN63

The extension sought by the CFMEU to the effect of their rule so as to cover the workforce of suppliers to the industry is a massive step and a massive extension and to perform such an extension, or for the Commission to countenance such an extension in these circumstances would in my submission leave the way open for a serious potential for disruption and confusion as to the actual extent of the CFMEUs rules. In the case that I have postulated in respect of Harnischfeger, for example, the CFMEU rule, if Hibble's case is still good law and there is no reason to suggest that it is not, I think both sides are relying on passages from Hibble's case in relation to these proceedings, then the fact of the matter is, it appears, that the CFMEU rule runs into the workshops of Harnischfeger.

PN64

Now, as I say, is a brand new development. It's a development which would cease immediately if Harnischfeger were to lose its contract with coal companies. Suddenly the CFMEU wouldn't have coverage in their workshops any more. If Harnischfeger decided to concentrate on the metalliferous mining industry that coverage would evaporate. There would be an enormous amount of confusion as to whether if Harnischfeger got no contracts from the coal industry for a year, lost its maintenance contracts and nobody wanted to dragline for a couple of years and they weren't putting work into coal mines but they continued to beaver away feverishly because the metalliferous mining industry had taken off.

PN65

The coverage based on the coal industry rule would stop at some point, depending upon the number and the existence of coal industry contracts held by Harnischfeger at that point in time, because the characterisation of their business would be in or in connection with the coal industry and once they ceased having any contact with the coal industry presumably that coverage would cease. Now, how does one rationalise that in terms of the role to be performed? The business would be the same. The manufacturing work done at Bassendean and Hemmant and Mackay would be exactly the same and everyone would be beavering away making the same things and they would be going out the same door. They would just be going to different mines as a result of which the union coverage would change, despite no change in the business activities which generate the income, or the vast majority of the income of this company.

PN66

It cannot be, with respect, that the eligibility rules of unions can be interpreted, this eligibility rule can be interpreted in such a way as to generate such a capricious result. It essentially comes down to the question of whether this rule applies to an employer would depend upon the state of the employer's order book. Not the nature of their business, but the contents of their order book as to whether they currently had contracts with coal miners or not.

PN67

If I could instance this circumstance, assume that the coal mining companies decided that Harnischfeger wasn't very good at maintaining their equipment, make good equipment but not very good at maintaining it, and they cancelled all of the maintenance contracts and employed Silcar, for example, G & S Engineering, one of the other engineering companies who are due to come and maintain their equipment, so that Harnischfeger withdraw all its personnel from the mine sites and continued to manufacture large pieces of equipment and send them off to coal mines, everywhere else, but the maintenance contracts were held by others. The core and the vast majority of the business of Harnischfeger, including the provision of equipment of the coal industry would continue on exactly the way it is now but the cancellation for maintenance contracts which come and go, as we heard, in these industries would remove eligibility from the coal industry.

PN68

Now, in that instance the CFMEUs coverage would go from being the total workforce of Harnischfeger to none of the workforce at Harnischfeger because of the activities of maintenance personnel on a couple of sites. Again, the capricious operation of a rule of that kind by reference to the contents of the order book rather than the substantial nature of the business cannot possibly be taken to be the way that this rule is intended to operate. The point is made in the written submissions that there is the CFMEU arguments in relation to the application of their rule confuse the circumstance of engaging in an industry with the circumstance of engaging with an industry.

PN69

Harnischfeger certainly does engage with the coal industry, as it engages with all mining industries who are prepared to buy their equipment. They do not however engage in the industry or in connection with the industry if one takes the view that one is required to have regard to the substantial identity of the business conducted by Harnischfeger. The substantial identity argument in relation to the employer, I understand from the earlier decision made in relation to Dyno Nobel by your Honour, that your Honour has ruled against that view.

PN70

In the interests of continuing to press a consistent line in respect of this matter can I again make the submission for the purposes of these proceedings that the manner of examination - I am sorry, the manner in which the employer is to be evaluated as a matter of fact as to whether they are as a matter of fact engaging in or in connection with the coal industry is to be determined by reference to - if I could for convenience, rather than hand up a copy of the case, refer you to page 14 of the Ms Gray's written submissions and it's the passage from Gibbs CJ which starts at the bottom of page 13 and goes over to page 14. It's a convenient reasonably recent adoption of a principle which has been around for a very long time. The submission is made at the bottom of that page:

PN71

His Honour moved to consider if the Commission was incorrect in its distinction between the work done in the plants and that done at the mine.

PN72

This is in the context of the Argyle diamond mining case which is not quite to the facts of this case, but the quotation is that:

PN73

A decision of the question whether a particular description fits an industry or calling involves matters of degree and the answer may depend upon the "substantial character" of the activities carried on.

PN74

And there is a reference to R v Moore and the cases therein cited -

PN75

That does mean that the enterprise has two purposes that it is necessary to decide to which is the predominant. It is quite possible in an ...(reads)... cannot also come within another.

PN76

And his Honour goes on to cite authority for that and the observation of Jacobs J. But the words in quotation marks, "substantial character", is a test which has come from R v Moore and probably earlier. It appears to have also been referred to in the Thiess Repairs as a way that the matter is to be characterised. What that means in simple practical terms is one, has a look at the business and then one takes what I have described in earlier submissions as a helicopter view of the substantial character of that business, not merely vocational activities which might be carried on in the context of that business.

PN77

If the substantial character of the business is one thing and one thing only, that is, the manufacture, repair, maintenance, sale and distribution of surplus mining equipment, then the question as to the substantial character of the business is answered by that description and that is the industry, the employer industry or the employer business within which that industry sits. The next question that is permissible to be asked and is raised by these proceedings is whether in accordance with the discussion by Gibbs CJ it is also possible to say that the employer has adopted another business, so that the business that they are in can be described in two ways.

PN78

The primary submission that is made in these proceedings on behalf of Harnischfeger is that you cannot say that the mere fact that your goods and services go to a particular location and that you as the service agent follow them into that location to service them at that geographical location, that you have thereby acquired another business. It is exactly the same business that you do on your metal mining site, on your gold mining site, your iron ore site, your bauxite site, it's exactly the same thing. It doesn't take it colour or its description from the product that your customer is producing. It takes its colour or its description from the reason why you are doing what you are doing.

PN79

You are not doing what you are doing to dig coal. You are doing what you are doing because you have been contracted to do so for the purposes of maintaining the equipment which is the core of your business. And as I submitted earlier, if the nature of Harnischfeger's business took its colour and its character from the business of its customers, then Harnischfeger is in a dozen businesses, not just one or two. But when one's business, when one's core, admittedly core business, involves the sale and delivery of your product into someone else's business, it's not a case of you sell your product to the general public but you sell it to another business, then to say that your business takes it character or its colour from your customer's business is an incorrect analysis and one would need to become heavily enmeshed in your customer's business.

PN80

For example, if one were to take over the contract to operate the draglines, not to supply the dragline but to operate the dragline and to dig up the dirt, or to operate the shovel to pull out the coal, then not only are you supplying your equipment to the miner you are actually doing the mining and in that sense, one would have to say, you had crossed the line between supplying your product to a customer and becoming involved in the customer's business. And the mere supply of equipment of itself couldn't put you in your customer's business. The maintenance of that equipment as a matter of fact, in particular the circumstances of this case, doesn't put you in your customer's business and that's where it stops with Harnischfeger in relation to the supply of plant and equipment.

PN81

Of course there is one exceptional qualification to that and that's in relation to the drilling works which I will come to shortly. But in relation to all of these other matters, in relation to the vast majority of the income and business activity performed on or about coal leases, or in or about the businesses of coal miners, it is undoubtedly the case that the maintenance work which is performed and the provision of the equipment which is performed does not acquire a different character or a different colour by virtue of the location in which it is performed or the nature of the product which is produced by the use of that equipment by others, and that is the fundamental issue as a matter of fact to be determined in these proceedings.

PN82

On that basis in my submission, partly because of the cataclysmic confusion that would thereby be generated were the CFMEUs contentions in these proceedings to succeed, that as a simple matter of fact one does not ordinarily accord the supplier of the service the identity of its customer. I mean there may be, for example, a difference as a question of fact and degree if a service provider only had one customer and it existed to supply a product to a customer and it went out and spent its entire time on the customer's premises and that was in effect it operated merely as an adjunct to that customer's business and without that customer it had no business, for example.

PN83

It's possible as a question of fact one would have to concede that it may be that a supplier in those circumstances became so emersed in the customer's business it could be said to be part of that customer's business, but it is again as a question of a matter of fact and degree. Harnischfeger is more on the Telstra side of the record when it comes to those sorts of questions because it has 370 employees, a very, very small percentage of whom ever go near a coal lease and it manufactures multi, multi million dollar pieces of equipment in its various workshops for those 370 employees, much of which never goes anywhere near a coal mine. So that one could say that a company of that size, that magnitude, that number of employees and that diversity of business of itself commenced, in effect, what can be characterised as a separate or second business, or a business which is capable of two descriptions.

PN84

Not only is it the manufacture and supply of mining equipment, but it is also a business of being engaged in the coal mining industry by virtue of conduct that activity. And the last thing that needs to be said on that subject and in respect of the question of confusion that may be created, that if this principle is accepted by the Commission, that is, that a service provider can be and is thereby engaged in the industry of employer if they send personnel out onto the site, that there are effectively no limits to the factual application of that principle so that every service provider to the industry is capable of being characterised in that way and that an enormous range of activities are capable of being characterised in that way by virtue of the sale of the product to the industry.

PN85

I have earlier made the submission and we make it again, that the similar considerations apply to the supplier of the light vehicle fleet, the supplier of all of the equipment that is used out on the mine site and the supplier of electronic equipment, communications equipment, radios, telephones, the computers which are used to calculate glass patterns, things of that nature, all of that equipment, all of the suppliers of those equipment and in particular the service people who attend at that equipment on the mine site are all thereby taken to be engaging in activities without which the mine cannot operate and that their employers are thereby engaging in the mining industry in respect of the infinitesimal proportion of the workforce which goes onto those sites.

PN86

The question isn't to be answered as the CFMEU contends; by reference to how close the actual coal in the ground the work is performed. The point seems to be made that there is a great difference between providing the food in the crib hut and in the dining rooms and the linen in the accommodation, as was the Poon Bros situation. There is a big difference between that and actually providing the equipment which is used to dig the coal. Well, it's not the matter of principle, in my submission, doesn't depend upon the proximity to the actual coal face. You are either engaged in the industry or you are not and you have either become a participant in the industry or you retain your identity as being firmly rooted in your own industry and making a contribution to the industry without thereby being taken for industrial purposes to be involved.

PN87

It is the question as to whether the involvement is sufficient to warrant an extension of industrial union coverage, which is the question which always must be borne in mind when dealing with these matters of interpretation. It is quite possible to say that these people get coal dust all over them every day. They go to work every day on a coal lease. They are always out there. They are always fossicking around in that area. They work side by side with coal workers. The same thing might be said of the mine chaplain who is out there every day fossicking around dealing with coal, working side by side with people. That doesn't in that sense make the local pastor a person who is engaged in the coal industry.

PN88

One has to look very carefully at whether there is a sufficient industrial connection such that one is prepared to then extend industrial coverage, as these rules do, to every employee of the employer because that employer has assumed a new role in life. For those reasons the submission has been made that the CFMEU does not have the requisite coverage of the employees of Harnischfeger. I reserve for further submission the question of those employees who are engaged in some drilling activities and that is a matter which is dealt with in the written submissions at paragraph 36.

PN89

The drilling service and the extent of the drilling service that was provided are dealt with in the evidence. They provide an extremely small proportion of the overall activities of the company. They are not unrelated. In fact they are integrally related to the equipment sales, hire and service business. They are a drilling service which is utilised in a very limited number of sites. It is a very small part of what the business does. It is fundamentally related to the fact that the company manufactures and sells drilling rigs which it sells to a large number of mines of every possible description and other industries which require the services of some form underground drilling, not necessarily mining industries, and on that basis the drilling service which is provided is a logical adjunct to the provision of that kind of equipment.

PN90

In many cases, as it appears from the evidence, the provision of the drilling service has arisen by reason of the fact that a drill was being offered for sale or lease and that the customer requested that in addition to providing the actual drill, that the company locate and provide personnel who were able to operate the drill which is being supplied. The submission is made in paragraph 36 that that case in the very limited number of sites in which that activity occurs, does not detract from what we have submitted is the substantial characterisation test. That is, to take a sensible holistic approach to the assessment of the nature of the business, and that sensible holistic approach to the fundamental substance of the business would not mean that the mere fact that a small number of drillers on a very small number of sites of itself required that a company of 370 employees with its multi, multi million dollar turnover in relation to the manufacture of that kind of equipment is thereby taken to have acquired a separate and distinct character of being a participant in or in connection with the coal mining industry.

PN91

The industrial coverage of those persons is properly placed with the industrial coverage which is relevant to employment by the manufacture of drills and of this kind of equipment and the relevant eligibility is to be determined by considerations other than the question of whether the employer has thereby become engaged in or in connection with the coal. Again, one has to ask the question where would one draw the line in relation to those matters. If the company sells 20 drills and operates one of them, could that be said that it operates in the coal - that it becomes an operator in the coal industry, the answer is fundamentally, no, of course not.

PN92

If it were to sell 20 and to operate all 200 of them, as a matter of fact and degree the matter could be considered in a different light. But in this case because of the again, infinitesimal part of the business activities covered by this company, the simple submission is that one swallow doesn't make a summer in relation to this matters and that a small amount of personnel operating drills which are sold and serviced by this company on the back of their drills, sales and service business, does not convert a business which is fundamentally a manufacturing sales and service business into a business which is engaged in another industry.

PN93

Again, in that respect, the fact of one or two drill crews, if it were sufficient in the circumstances to constitute the company as thereby itself engaging in the coal industry, if that matter alone were sufficient then one would have questions of industrial representation of the whole workforce of the company generated by, again, the state of the order book of that company. Were it to lose a drilling contract at the one or two coal mines where drilling is performed, then all of its employees would thereby be removed from the coverage of the CFMEU. One needs to look at the matter in an overall sense in a way there is no coal being extracted, there is no coal being moved, there is no coal being sold by Harnischfeger and the balance of the overall activities of the company from the substantive point of view is not altered by that small element in its overall business activities.

PN94

If it please the Commission, for those reasons we contend that no employee of Harnischfeger is eligible to be a member of the CFMEU. It follows of course that the demands by the CFMEU in these proceedings cannot be acceded to as the CFMEU has no constitution or eligibility to make them and in the event that they are made, then no industrial dispute is generated by the non accession on the part of Harnischfeger. For those reasons it is submitted that the Commission should refuse to make a dispute finding in this matter in relation to Harnischfeger. Can I assist any further, your Honour?

PN95

THE SENIOR DEPUTY PRESIDENT: No, thank you, Mr Herbert. I intend to just move straight on to hearing Ms Gray unless either of you require a break? I hope, Ms Gray, you are not going to attempt to read me your submissions. It will only be an attempt, trust me.

PN96

MS GRAY: Your Honour, the union has done a very comprehensive submission and did foreshadow in that submission that I intended during this hearing to apply the law as analysed to the facts as extracted, but I really don't think that that's a necessary exercise for me to conduct. Rather, your Honour, I just wish to - - -

PN97

THE SENIOR DEPUTY PRESIDENT: I have read the submissions, Ms Gray, and I don't think that's necessary.

PN98

MS GRAY: Thank you, your Honour. Your Honour, there is just a couple of issues I wish to raise by way of seeking to clarify the extent of the union's interest in this matter and what we are seeking from the Commission and also to respond very briefly to a number of matters raised by Mr Herbert. Your Honour, I won't seek beyond what is already in our submission in that part which relates to the relevant case law to distinguish Poon Bros, rather I say that in R v Moore ex parte Federated Miscellaneous Workers' Union of Australia, the High Court distinguishes Poon Bros and I certainly won't seek to do that again. We rely on that and that's at page 10 of the extract - page 10 of our submissions.

PN99

It is also distinguished, your Honour, by the High Court in R v Holden ex parte Australian Workers' Union and that is at page 12 of our submissions on the law. Your Honour, I do thank Mr Herbert for pointing out that I had the wrong century. I have probably got the wrong millennium half the time, but on page 2 I would like to make the correction to my submissions in the paragraph that said:

PN100

During the first half of this century -

PN101

To change that to:

PN102

During the first half of the 20th century -

PN103

Your Honour, there was a deal of evidence in this case about the construction of draglines and shovels which were done, as we heard, from both Mr Murray and Mr Shea on construction pads, either excised from the coal lease but as an island within it, or as with Bulga across the road from the mining lease. We say, your Honour, that under the authority of R v Moore ex parte Miscellaneous Workers' Union, that that work can be seen as an integral part of the mining operations, its construction, its construction that leads immediately into the use of that equipment as part of the mining process.

PN104

The United Mine Workers Federation of Australia which was the mining section pre CFMEU amalgamation was, as your Honour is aware from dealings in this industry, a party to an unregistered agreement in Queensland which regulated this work. It covered major shutdowns, as well as construction of draglines, shovels and wash plants and did so up until about 1997. It was called the Miner Maintenance and Construction Agreement. The unions party to that agreement, your Honour, were the Electrical Trades Union, the Metal Workers' Union and UMFA and before that the United Mine Workers.

PN105

So we say that in terms of Queensland that work has been regulated in accordance with an agreement which to a large extent reflected coal mining industry terms and conditions. In New South Wales in this case, your Honour has heard that on the evidence of Mr Murray that work is generally regarded as construction work before a dragline or a shovel are actually commissioned and walked into the coal site, at which time he says it is clearly coal mining industry work. However,
Mr Murray also said that there have been some agreements reached with his union, meaning the mining section of the CFMEU, in respect to not only major shutdowns but that construction work and we refer there to paragraph numbers 460 to 464 of Mr Murray's evidence in transcript.

PN106

Mr Shea on the other hand said that in his experience it was always construction work and although that is somewhat left in a bit of a grey area, the union reserves its position on the area of Harnischfeger's construction, shovels and draglines on construction pads in Queensland and New South Wales as falling under our coal rule 2(d). We say, your Honour, that's an argument for another day. It's an argument where detailed evidence should be raised by both sides to assist the Commission in making a determination of whether that falls under rule 2(d) or not. The union is in a happier position that the Miscellaneous Workers' Union was in R v Moore ex parte the Miscellaneous Workers' Union where it was the construction union and the AWU was the mining union. We happily, your Honour, both the construction and the mining union within our various divisions.

PN107

So we don't see the urgency or necessity to deal with whether or not that work of Harnischfeger falls within rule 2(d) as we say that on the evidence of Mr Murray and Mr Shea in New South Wales at least, that that work falls within construction rather than metal manufacturing work. Your Honour, the union's construction and general division and our old FEDFA rule are sufficient that we have substantial presence in construction work in any case and clear eligibility. But they are not under the rule 2(d) which is the subject matter of the current proceedings before your Honour.

PN108

However, your Honour, there was evidence from Mr Shea about the construction of the Bulga dragline. It was addressed by Mr Shea in his examination-in-chief at paragraph numbers 1138 through to 1145 where he said it was built under a construction agreement. Mr Herbert put it to him that it was an agreement with the Metal Workers' Union and at paragraph number 1143 Mr Shea replied that he was unsure of the union but was quite sure that it was a construction agreement. Your Honour, I seek to hand up a copy of the Harnischfeger of Australia Pty Ltd at PNH97020 Bulga Dragline Erection Project Certified Agreement 1995. I don't know whether it's necessary to mark it, your Honour, but if it is I think we are up to GRAY6.

PN109

THE SENIOR DEPUTY PRESIDENT: No, it's not necessary. Why do you say the question of the erection of draglines is a matter for another day is relevant?

PN110

MS GRAY: Only, your Honour, in terms of clarifying that area that was left in a bit of a grey spot in terms of construction, to point out to your Honour that the Construction, Forestry, Mining and Energy Union was a party to this certified agreement and to also submit, your Honour, that - - -

PN111

THE SENIOR DEPUTY PRESIDENT: Ms Gray, I don't think that the question of erection of the dragline is really a matter before me in any real sense.

PN112

MS GRAY: No, your Honour, I am sorry. The point I was going to make was that Mr Herbert says that Harnischfeger has one business and one business only. One of the points I was to make about this particular certified agreement as with the other agreement which is referred to in the evidence which governed the work out of the Mount Thorley workshop and on the sites in the Hunter Valley is that in order to have a certified agreement, your Honour, we are all aware that a company must sign statutory declarations to say that that agreement applies to a separate business or a separate part of the business.

PN113

So, your Honour, we say that on the company's evidence alone Harnischfeger has a metal industry business which is in its workshops. On its own evidence it has a construction business which is the erection of draglines and shovels on the construction pads. We say it has also got another business and we are reserving our positioning terms of the construction being part of that, it is the work that is done on the coal mining site, servicing the draglines, the shovels, the truck bodies and the operating and servicing of drills.

PN114

THE SENIOR DEPUTY PRESIDENT: Right, thank you.

PN115

MS GRAY: What we say, your Honour, is that having reserved our position on the construction that as soon as the dragline is walked back onto the site and commissioned, that it and the shovel likewise become an integral part of the mining process and all maintenance and operation of them is a part of the industry until they are decommissioned and that work falls squarely within rule 2(d) of our constitution rule. Your Honour, another general comment which I would like to emphasise in respect to our submissions, it is made throughout them but I do want to emphasise that the examination of the coal industry by the High Court is placed in a somewhat of an unusual position and that is that the decisions were made with the exception, I think, of Hibble in respect to the industry whilst it was regulated as a separate part, a separate industry from normal industrial regulations regulation, both under war time emergency regulations and subsequent and also then of course into the times of the Coal Industry Tribunal, its predecessor in New South Wales where the extent that those bodies could deal with was only work in the coal mining industry.

PN116

Our rule 2(d) is substantial broader than that, not only in terms of work in or in connection with the coal mining industry, but it goes to work in or in connection with the coal industry. What we say in terms of the coal industry, your Honour, is that the coal industry goes from exploration to the loading of coal onto ships for export. It is pre picked ..... is the extent of the coal industry. What we are seeking from the Commission, your Honour, is not only a finding that of course we have jurisdiction to represent employees of Harnischfeger under rule 2(d) in its broader sense, but that that work falls within the very narrow constriction that has applied to the coal mining industry in decisions in the past, that it falls within the definition of in or in connection with the coal mining industry.

PN117

We do that, your Honour, to try to avoid if at all possible at a later stage of roping-in, or at least discouraging the employer at a later stage roping-in from re-running exactly the same arguments that yes, of course it falls within rule 2(d) but that doesn't mean that it's in the coal mining industry and the ..... award applies only to work in the coal mining industry. If I can now move to replying very briefly to Mr Herbert's submissions this morning, your Honour. We say that in Hibble's case yes, the High Court determined the business of the employers involved and distinguished between them, but it did so by also looking at the work and when and where that work was done to delineate between those industries.

PN118

It's a decision which acknowledges that coke works done on a coal mining site was part of the coal mining industry. It said that coke work is done on a steel manufacturing site was part of the steel industry, iron and steel industry, but it also went to placing the distinction about the time that work was done, your Honour, that the work done by the workers employed by the steel industry employer was done after the product had left the mine site and had been taken delivery of by the customer. BHP Iron and Steel was the customer and therefore it distinguished on the basis of not only where the work was done but when it was done and by whom.

PN119

That's an important aspect which is emphasised by the High Court in their wheat and bread analogy in the decision at page 297 of that case, your Honour. Similarly in the The King v Hickman ex parte Fox the transport companies never entered the mine sites on the facts examined by the High Court in that case,
your Honour, to collect the coal. In fact there was a very clear distinction drawn by the work of those employees engaged by general carters to cart coal to customers off the mining site. They handed their vehicles over to coal mining employees to take them onto to the site to have those trucks loaded.

PN120

So once again it was a situation of general carters employing employees to perform general cartage. One of the products that those employees were engaged to cart was coal but it was only one of the products. Those employees weren't designated coal carters and the High Court once again applied the law to the clear and distinct facts of that case. Mr Herbert spent some considerable time giving the Commission numerous hypothetical examples and what ifs. We say they don't help us at all, your Honour, and we say that the task, with respect, is that this Commission is to form of a view of the interpretation of the union's rule and apply it to the actual facts as presented in the evidence, and we rely on those facts as extracted in our submissions.

PN121

Mr Herbert said that the decisions don't go to contractors who are involved in the process after construction, all of the decisions which favour the union's argument are dealing with contractors who are involved in the construction of mining sites or processing sites. He of course did not refer to the Coal Industry Tribunal cases which are also relied on by the union and which do go to contractors, examples of contractors who have been performing work on and about operating coal mines. Of course the Coal Industry Tribunal again, your Honour, that was restricted to deciding matters which were in the coal mining industry, not in or in connection with the coal mining industry or in or in connection with the coal industry.

PN122

Nonetheless, a number of contractors, as Mr Herbert would say, providing services, we say, engaged in parts of the continuous process of coal mining were found by the Coal Industry Tribunal to be within the industry and of course the only appeal mechanism from the Coal Industry Tribunal was the High Court and there were no decisions, no appeals from the decisions relied on by the union from those employers who were found to be in the coal mining industry which is why the analysis of the High Court of the coal mining industry stops in the early 40s.

PN123

Mr Herbert talks about the vice of the interpretation that the union presses on the Commission and says that the real vice is that all employees of Harnischfeger will be found to be in the coal mining industry. Your Honour, we say that it's quite up to the Commission to determine which areas fall within the coal mining industry and we are not asking the Commission to deal with those industries which fall outside the coal mining industry. In Mr Herbert's analogy, following the rope up to the end of the workshops we say it is not necessary, but of course if the Commission was to look up the rope to the workshops then it would find the metal industry and not the coal industry.

PN124

We don't have any difficulty acknowledging that, your Honour. Mr Herbert said there would be cataclysmic confusion that would result if the CFMEU was allowed to chase the workshops. We just note that in passing that the CFMEU is party to the Metal Industry Award, both part 1, and we are the sole union respondent to part 3. We have no difficulty with acknowledging that we have a role in the metal industry, your Honour. We have a role in that award. We have a role with the respondents to that award and within our own divisions we have no difficulty seeing where those industry boundaries lie.

PN125

Mr Herbert made an argument about the size of the equipment. It was just the size of the equipment that required it to be addressed on site. We say that draglines and shovels are plant, just as a wash plant is. There is a clear distinction in maintenance on coal mining sites between mobile equipment and plant, even with coal mining companies that continue to do their own maintenance, mobile plant is brought up to the workshop to be worked on, plant is worked on in-situ. That plant which is worked on in-situ is draglines, shovels and drills and wash plants. So it isn't - sorry. In R v Isaac ex parte The TWU, also referred to in our submissions, Gibbs CJ discussed the physical proximity between the mine and the primary crusher and went on to say that it wasn't a contrived or adventitious. It was necessary for the economic operation of the project.

PN126

We say it's the same case for the draglines and shovels and drills, your Honour, that having maintenance performed on them in-situ is a necessary part of the operation of coal mining and also an additional point as to why Harnischfeger's employees performing that work are engaged in the coal mining industry and Harnischfeger itself is engaged in the coal mining industry in respect to them.
Mr Herbert spoke of the field services being a tiny part both in dollars and numbers of employees. We say, with respect, your Honour, it isn't necessary to determine Harnischfeger's business in a holistic sense or to look at the amount of money or the amount of employees engaged in one or other parts of the business. All it is necessary, with respect, to do is to see whether or not Harnischfeger is engaged in the coal mining industry with the work which has been subject to the factual evidence placed before the Commission in this case.

PN127

But your Honour only needs to look at that evidence in respect to the Mount Thorley situation to see where the company's emphasis lies. That was an off site workshop, much the same as Mackay, but it closed, your Honour. As we heard in evidence, it closed a couple of years ago and when it did all of its workshop employees were retrenched. All of its field employees continued to be employed, continued to work out on coal mining sites day in, day out, on contracts, as we have heard, up to 10 years duration. In terms of the drills being an infinitesimal part of the business and a small number of drill sites, your Honour, on the current evidence there is six sites in New South Wales and Queensland where Harnischfeger provides the drills and operators as an intrinsic of the drill and blast operations and has also recently engaged a five person flying maintenance crew to perform maintenance on site on those drills. They go from site to site and do nothing but that work.

PN128

Clearly, your Honour, the operators of the drill do not have enough free and available time to do that maintenance themselves. As to a coal chaplain, your Honour, I have no idea who that person would be. Perhaps in metalliferous they have a position of that nature, but I have never gone on a mine site, your Honour. So that's the submissions of the union. We rely on our written submissions, your Honour, and we press for a dispute finding in respect to Harnischfeger's employees engaged on coal mining sites throughout New South Wales and Queensland. May it please.

PN129

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN130

MR HERBERT: Your Honour, could I respond very quickly to some of the things that has been put by Ms Gray that aren't in her written submissions. She tendered the certified agreement relating to the Bulga dragline direction. That dragline direction was the subject of evidence by Mr Shea in the transcript and at paragraph 1137 it commences. Interestingly what happened, according to
Mr Shea's uncontradicted evidence was that the site in question was excised from the mining lease. It was not part of the coal mining lease while the construction project went on. When one also looks at the agreement, the application of the agreement is said to be:

PN131

All employees who are bound by the terms of the National Metals and Engineering On Site Construction Industry Award.

PN132

So is the metal award. It's not coal award at all. The construction was performed - or the said to be constructions performed, under the Metals and Engineering On Site Construction Award. The unions are the MECA unions. The site was excised from the coal mine and the CFMEU not being a party to the MECA Award appear to have been added to the lease, but one sees the standard MECA Award unions, the Metal Workers' Union and the AWU and the ETU, as they then were. But that obviously was a metals construction site done under the National Metals and Engineering On Site Construction Award by unions other than the CFMEU for the large part.

PN133

But we are then told, but the union reserves its position in relation to that. Well, with respect, given the approach they have taken, this isn't a reserved position situation because if, as they say, the provision of equipment and the maintenance of the equipment to a coal miner puts the employer in the coal mining industry, the building of the equipment that is then provided and the walking of it across the road has to be connected relevantly to that work so that the CFMEU has their eligibility to cover that work. Now, the evidence of Mr Shea in exhibit H2 said that the reason why those things are done is that the equipment is of sufficient size that the manufacturing process is performed in manufacturing workshops but that the equipment needs to be assembled - I will give you the reference to the evidence of Mr Shea. It is exhibit H2 and it's paragraph 8:

PN134

Due to the size of the equipment manufactured by Harnischfeger it is necessary in some instances for the final stage of the manufacturing operation ...(reads)... into an operational dragline.

PN135

That's the process. They manufacture things, they bring them together on site and assemble them on site because they are so big you can't transport them by road once they are assembled and it's pretty fundamental stuff. But the point that arises out of that is that if the connectivity between that, the connection between that work and the fact that it is being supplied to a mining company, that is the very essence of the claim in relation to Harnischfeger, that you are supplying this equipment and you are servicing it when it is there. Building it in that sense has no, one would say, relevant distinction from maintaining it once you have built it.

PN136

If you are involved in the sale and the maintenance of the equipment which you have constructed in the Hale Creek situation, on an island in the middle of the coal lease, Mr Shea's was the Commission may recall, that there was an area of 250 metres by 150 metres, I think was the measurements, which was legally excised from the coal lease and handed over to P & H and they became the occupier of that lease to the exclusion of the coal mining company for the purposes of the Hale Creek dragline construction. Constructing on an island within the coal lease and then walking 100 metres to the pit, one would have to say in ordinary circumstances would be sufficiently connected to this process, that if servicing - and what that 100 metres means is that you have gone into coal industry, then manufacturing it or assembling it 100 metres away would also put you in the coal industry by reason of that activity, as would the manufacture of the parts that you have brought there to assemble. They are all part of a continuous process.

PN137

The CFMEU can't say in these proceedings to the Commission don't look at that, we reserve our position about all our construction stuff, we may chase that later. So as soon as the Commission determines that the servicing of equipment, the sale and the servicing of the equipment on site gives the CFMEU sufficient coverage because the employer has thereby entered the arena of the coal industry in a relevant way, then the rest of that coverage is exposed all the way back the line to who knows where, probably back to Perth. But the CFMEU seeks to ask the Commission not to look at any of that, as to whether that coverage does or does not exist, because of the obvious anomalies that would be generated by that coverage coming into place, the eligibility coming into place and the ability to seek award coverage all the way back to Perth in relation to Harnischfeger.

PN138

That is for the obvious reason that I have been submitting since the outset out of this case, because that result dictates very much why the Commission should be very slow to declare in the circumstances that the sale and servicing aspect which Harnischfeger does renders it eligible for its employees to become members of the CFMEU, because there is no logical dividing line that stops the coverage going all the way back into its manufacturing bases. And the reason for that, as I submitted earlier, is the passage that is in the written submissions in relation to Hibble's case where at page 297 of that report the court said this, and it's five members of the court, or all members of the court:

PN139

Some employers extract coal from the earth and convert some of it to coke and distribute both coal and coke to consumers. Such a business would ...(reads)... in or in connection with that industry.

PN140

The gravamen of those passages it appears and the logic of the way that the rule is written, is that all of the employees in that business, all of employees of that employer if it is one business, become eligible to become members of the CFMEU and that is why one must take the whole of the business into account when deciding whether the CFMEU was intended to coverage of that whole business and it is not to the point, as Ms Gray said in her submissions a moment ago, that this work here, that what these employees are doing here is work that's covered by rule 2(d). That completely misses the point, with respect. It is not whether what the employees are doing there comes under rule 2(d), it's whether what they are doing there means their rule comes under 2(d).

PN141

That's the issue to be decided and because I have used the cataclysmic and I use that word advisedly, because if the work of a couple of employees transforms the employer into it being said they conduct a particular type of business, the coverage which is thereby exposed is not confined to those employees, if in fact those employees are simply part of a larger business. No-one has said, so no-one has suggested in the whole of these proceedings that Harnischfeger has a servicing division which can be said to be an identifiable part of its operations such that it can be said that that is a discrete and separate business, which is the only business which is the subject of these proceedings.

PN142

These proceedings seek a dispute finding against Harnischfeger and as it only conducts, as we have said, one business, then the dispute finding is sought in relation to all the employees of that business. And as I say, on the facts of this case, because of the connection between the sale and the service, the manufacturing, the assembly and the manufacturing of the various locations, once one connects them altogether the finding that is being sought by the CFMEU in these proceedings would have the consequence that all of the business on Harnischfeger would be covered and that seems to be a point that the CFMEU does not want you to determine in these proceedings.

PN143

With respect, it must be determined and it must be taken into account when deciding whether the coal and shale industry rule was intended to be a rule that had that level of application so as to implicate all of the businesses of suppliers of plant and equipment in the way that has occurred here, if the Commission is of the view that it can't be possibly be intended to run back up and rope the businesses of that kind, and the way you can tell that is to look at the whole of the business to see whether it's intended to go to the whole of the business of that character. If the Commission reaches that view then the only conclusion to make is that a dispute should not be found. Other than that, that's my submissions in reply.

PN144

THE SENIOR DEPUTY PRESIDENT: Thank you. I will reserve my decision.

<ADJOURNED INDEFINITELY [11.57AM]