AG2005/3626, Transcript of Proceedings [2005] AIRCTrans 965 (22 April 2005)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 11217-1

COMMISSIONER BACON

AG2005/3626

APPLICATION BY OAKY CREEK COAL PTY LIMITED AND CFMEU
s.170LJ - Agreement with organisations of employees (Division 2)
(AG2005/3626)

BRISBANE

9.21AM, TUESDAY, 12 APRIL 2005

PN1

MR H DOWNES: I seek leave to appear on behalf of Oaky Creek Coal Proprietary Limited.

PN2

MR T CONROY: I appear on behalf of the CFMEU. I have no objections to Mr Downes' appearance.

PN3

THE COMMISSIONER: Leave is granted, Mr Downes. Mr Downes?

PN4

MR DOWNES: Commissioner, this is an application by Oaky Creek Coal Proprietary Limited for the certification under division 2 of an agreement reached in relation to the number 1 underground coal mine with the CFMEU. Commissioner, the relevant information is contained in the two statutory declarations which have been filed, one is signed by Simon Burnett, the operations manager of Oaky Creek Coal Proprietary Limited's number 1 underground coal mine, and the other by a Mr Vickers on behalf of the CFMEU. Commissioner, I submit that the two statutory declarations contain all the evidence and information required by the Commission, serve to say that it is my submission that the agreement and the manner of its making meet the requirements of the Act, the rules, and the regulations, and unless there is anything specific that the Commission would wish me to address, Commissioner, I would ask that the agreement be certified.

PN5

THE COMMISSIONER: I do have some matters that I want to talk to you about, Mr Downes, but perhaps I will hear from Mr Conroy first and come back to those. Mr Conroy?

PN6

MR CONROY: Commissioner, I concur with the submissions of Mr Downes.

PN7

THE COMMISSIONER: Well, gentlemen, there is some matters I want to discuss with you. None of them, I think, are fatal to the application for certification of this agreement but there are some things that I think concern me and they concern me to the extent that on the face of the agreement they appear quite uncertain. If I take you to clause 10, the contract of employment, it says that employees may be employed by the company on a weekly hire basis or for a specified term or for a specified job or task or as casual. Okay. So I understand all of that so there seems to be three types of employment, weekly hire, which I presume we can describe as full time, specified task or specified term, commonly referred to as fixed term employment and casual employment. The very next clause, subclause (b) says that employment may be terminate by the company by giving notice consistent with the provisions of 170CM.

PN8

Now, section 170CM, to the best of my knowledge, doesn't deal with termination of employment for casuals. Now, the question I have for you therefore is that the intention of the parties that casuals, depending on their age, receive the various periods of notice prescribed by the Act. Do you see what I mean? The subclause doesn't exclude casuals.

PN9

MR CONROY: Commissioner, thanks for pointing that out. I have got no instructions on this matter, I must say, but it would be our position that casuals would be excluded from the provisions of the 10(b).

PN10

THE COMMISSIONER: Provided that is the intention of the agreement and it is recorded on the transcript and the parties take that transcript away so that if there is ever a fight about it at some later stage everyone will have agreed that that is what is intended by the - at least there will be some evidence that that is what was intended by the clause at certification. Mr Downes, do you have any comment about all of that?

PN11

MR DOWNES: It would appear - let me say this, Commissioner, I have no instructions but on the face of the agreement that would be, in my submission, the logical interpretation of those two clauses. Otherwise they would invite a tension which should, in my submission, not be read into those two clauses. So I would concur with Mr Conroy that that would be the proper interpretation of those two clauses so as to avoid such a tension.

PN12

THE COMMISSIONER: Okay. The other question I have for you is this - and I have got to come back to the types of employment, there is another tension, I think, in there. But at clause 12 it says that the ordinary hours of work will be 35 per week. It doesn't again exclude casuals so does that mean that casuals can only be engaged on a full time basis, that is for a minimum of an average of 35 hours per week. Now, that could be an intention but what it does stop is - clause 12 doesn't seem to suggest any ordinary hours for people who work less than, and ordinarily that could be part time or casual people, less than an average of 35 hours per week. And neither is there anywhere else in the agreement where it - except in, I think, maternity leave provisions.

PN13

MR DOWNES: Commissioner, again, in the absence of instructions I can only make this submission that 12.1 is intended to do no more than to indicate the number of hours at which the ordinary rate of pay would apply. It would not prevent a discrete arrangement for an employee to work, for example, an employee who may be returning to work on a graduated basis following the birth of a child or an injury of some sorts. So it's not intended to be a cast iron, thou shalt work no more and thou shalt work no less, type clause. It is merely an indication of the number of hours at which the ordinary rate of pay would apply and reading from the rest of the agreement, more hours than that would attract the usual penalty rates as would apply.

PN14

THE COMMISSIONER: But nevertheless the people you speak of are full time employees who are working on a graduated basis but - see, in the contract of employment clause there is no reference to part time work. And I guess that's my point. Casuals or part time. Anyway, I am happy with that - - -

PN15

MR DOWNES: Commissioner, maybe there is that the weekly hire does not necessarily mean that it has to be 35 hours per week, it may be 30 hours per week, it may be some other arrangement subject to the remainder of the provisions of the agreement. It is merely an indication of essentially pay frequency. I don't think that the 35 hours is intended to disallow a variation from it.

PN16

THE COMMISSIONER: Do you agree with that?

PN17

MR CONROY: I don't actually, Commissioner. I don't think that's important or anything turns on that. My reading of 12.1 is a given roster cycle, things have to average out so that the ordinary hours of 35 hours per week. Some weeks you may have more, some weeks you may have less but on average it's 35. I think 12.1 is that's all that is saying and doing no more.

PN18

THE COMMISSIONER: But there are provisions interestingly and clause 11.2 introduces a whole new concept which is temporary employment which is not referred to earlier. But it says:

PN19

For a period of employment, temporary employees shall be provided with an accrual of appropriate entitlements under this award on a proportionate basis.

PN20

It says:

PN21

The company may in its discretion employ employees under the terms and conditions of the agreement as a temporary employee on a fixed term basis.

PN22

Well, I assume a fixed term basis - see, temporary seems to be interchangeable with part time.

PN23

MR DOWNES: Or a specified term. It may just be inconsistency in the drafting of the agreement.

PN24

THE COMMISSIONER: And I am not trying to look at this in a black letter way, what I am trying to do is get some record so that in two years when we are all, well, possibly me, is off doing something else and there is someone else arguing about what was meant, there will be a record of what the parties say for certainty purposes all this means. That's all I am trying to avoid.

PN25

MR DOWNES: Certainly, Commissioner.

PN26

MR CONROY: Do you think we are doing that, Commissioner? I think we will cause even more.

PN27

THE COMMISSIONER: In which case I will probably be quiet.

PN28

MR DOWNES: Commissioner, I would submit that the temporary employment is really a catch all for the specified term or specified job or task. Again, I would think that that would be an interpretation which would avoid there being any tension being read into the agreement.

PN29

THE COMMISSIONER: So a temporary has to have a fixed term but can work on a part time basis, that is, for less than an average of 35 hours a week.

PN30

MR DOWNES: That is my submission, Commissioner.

PN31

THE COMMISSIONER: It seems to implied in that sentence that I read out that they will accrue entitlements under the order on a pro rata basis.

PN32

MR DOWNES: On a proportional basis. Mr Conroy and I would have to agree to disagree on that but that is my submission that it does not preclude an arrangement whereby an employee works on average something other than a 35 hour week should that be the agreed hours, or the necessary or appropriate hours, for whatever reason and I have given two merely by way of an example. I think it would be unduly restrictive and, in my submission, just incorrect to read into the agreement that because it refers to 35 hours that 30 hours or a graduated return cannot be done under the terms of this - - -

PN33

THE COMMISSIONER: No. I have no difficulty as to the intention of that for full time employees that that can happen because they are full time employees, they continue to accrue their annual leave et cetera at the full rate even if they are working shorter than an average of 35 hours per week. There are other provisions in the agreement which allow a full time worker who doesn't attend work for certain reasons to be paid for time worked only unless they can have access to sick leave et cetera. I don't have a problem with that. It's more is an introduction of at clause 11, part time work. I mean in ordinary context what is headed temporary here is really part time work.

PN34

MR DOWNES: It would appear so, Commissioner. Yes.

PN35

THE COMMISSIONER: And the thing that draws me to that conclusion the most is the usual part time provision which accrues entitlements on a pro rata basis.

PN36

MR CONROY: Commissioner, again I have got no instructions in this but I am struggling with your interpretation.

PN37

THE COMMISSIONER: Of?

PN38

MR CONROY: Of 11.2. And I wonder if 11.2 was meant to be a provision that provided that those employees who are either employed on a fixed term or fixed task basis, for the term of the employment get the terms and conditions of the agreement on a pro rata proportional basis.

PN39

THE COMMISSIONER: But nevertheless work an average of 35 - so they work full time for six months.

PN40

MR CONROY: That's right. And I must say that is how I am interpreting the agreement. And I wonder if the work proportionate in the context it is used there is meant to actually be entitling those employees to a pro rata type arrangement during the period of their employment.

PN41

THE COMMISSIONER: Well, it certainly does that.

PN42

MR CONROY: For example, I wouldn't like to see a situation where a person is employed on a fixed term basis where they work one shift a week. I would be certain that those people within the organisation I work for that negotiated this agreement would not have intended that.

PN43

THE COMMISSIONER: Well, perhaps let's not create confusions where back at the site there may be none and maybe we will just leave it at that. I think that the construction of the agreement itself probably leans more towards your view, Mr Conroy, that the ordinary hours will be 35 but you may only work for three months. So if you are a temporary you have got to be engaged for an average of 35 hours per week but that might be for less and that doesn't impinge upon the issue you raise, Mr Downes, that an employee could be coming back from a work compensable injury on a rehabilitation program working only three days a week but nevertheless be a full time employee. The difference being that they would accrue their annual leave et cetera at the full rate even though they are only being paid for three days a week, for example.

PN44

MR DOWNES: Commissioner, Mr Conroy and I will just have to agree to disagree on that and it may not be a disagreement that applies irrelevantly on site at all. So I am just conscious that we are creating a transcript here, both of us in the absence of instructions, and trying to interpret the agreement in respect of which I don't think either or us were involved. I certainly wasn't and Mr Conroy indicated that he wasn't. So perhaps it is best left to the parties. If there were to be some difference or dispute about that it may be best resolved at that time rather than us, with the best intentions in the world, now trying to create an interpretation which may not be appropriate.

PN45

THE COMMISSIONER: Well, I am not trying to create an interpretation I am trying to actually understand what it is the parties have agreed.

PN46

MR CONROY: Commissioner, I think that your concerns are valid. You have experienced perhaps more than any of us where an agreement gets certified and a short period of time after the parties are back arguing about the meaning. What I think we should do is, assuming the Commission certifies this agreement this morning, I think that Mr Downes and myself should go away and take instructions from our negotiators, the people within our organisations who negotiated this agreement. And we should perhaps get agreement on what that clause means and perhaps issue a letter or exchange letters and ask to be put on the file.

PN47

THE COMMISSIONER: Well, that would be of benefit for instructional purpose should the matter ever come up for debate at some later stage. There is another matter and it's the last you will be happy to know, I don't understand what it is that clause 10(a) does. It says that people can be hired on a weekly hire basis, which I understand to be full time employment, or for a specified time or a specified job. Now, the courts have defined those terms usually to mean that a person is employed for 12 months and, barring misconduct, there is not a discretion of either the employer or the employee for the duration of the contract to terminate the contract. And that is well settled at law unless anyone want to tell me something is on the internet I haven't seen in the last 24 hours. Yet subclause (b) seems to suggest that even if you are on a specified term or a specified job or task at either the employer and the employees discretion, either can give notice to terminate the contract which makes it something that it is not on its usual definition a specified term or specified job or task contract. Do you see what I mean?

PN48

MR DOWNES: I do, Commissioner.

PN49

THE COMMISSIONER: It's a bit like casuals.

PN50

MR DOWNES: Yes, Commissioner. May I suggest that again, rather than Mr Conroy and I, in the absence of instructions, try to interpret that, may I suggest that that be dealt with in exactly the same manner as Mr Conroy has suggested the issue of casual employment be dealt with. That may be the safest and least likely to complicate an issue which may other wise not be complicated.

PN51

THE COMMISSIONER: This is a conflict that is rife in this industry and I have, in a number of places where I have had recently to try and resolve disputes about this, said that I am going to take whatever stops are necessary to ensure that I don't have to deal with this conflict two years into a certified agreement because I don't know how you resolve the conflict. I don't understand what is a specified term contract or a contract for a specific term, and let's assume that a term is for six or 12 months, that is terminable at the discretion of either party one hour after it commences.

PN52

MR DOWNES: Commissioner, I am happy to make submissions on how, again similar to the previous issue, how I think that that might appropriately be interpreted but might I suggest that we deal with both issues in one and place a letter on the Commission's file to indicate how the parties see that agreement. I suspect that it may be no more than that the giving of notice is always subject to the employee's term having run or the employee's contractual rights not being breached. And one finds this sort of provision in many contracts of employment where there is a happy little termination clause inserted. Nothing in the contract itself says that you cannot terminate without good and proper reason, simply you can terminate on notice. Now, we all know how limited the operation of that clause is and this may be, in a slightly different context, no different to that. But I would suggest, Commissioner, that the proper way to deal with this is for Mr Conroy to go and get clarity from our respective clients and members to clarify it so there is no uncertainty and place that on the Commission's file.

PN53

THE COMMISSIONER: I am happy to allow that but there is a significant issue that attaches to this and a person is entitled to know, as far as I am concerned, at the commencement of their employment whether or not they have access to, for instance, the unfair - part 6A of the Act is my issue. And I think a person at the time they enter into these arrangements should know whether they have access to that or not. And if at the end of the day the parties agree that it is what I might call a specified term job or task contract as has been dealt with by the courts in the past, and the people are exempt from part 6A of the Act, fine. That's not a problem for me. What I don't want is for them to be arguing about it sometime later and rights they thought they have, they don't have. Or alternatively, the reverse, the employer thinking these people are exempt from certain parts of the Act only to find out later that they are not. I would rather it be clear to both sides at the start and I am happy to allow everybody to try and resolve that by an exchange of letters.

PN54

MR DOWNES: I would be surprised if any difficulties would arise out of either of the issues that the Commission has raised. I am reluctant to make submissions just in the very unlikely event that there is some issue which I am presently unaware of and any submission I might make may just complicate and compromise the very good will that exists on site that resulted in the agreement being reached.

PN55

THE COMMISSIONER: I recently had someone who was put on as a temporary, this is in a totally unrelated - not in part of the ex strata group but another considerably large coal mining group, and they had two clauses just like this and for whatever reason wanted to terminate someone's employment who were employed for a specified task a week after they started, or actually before they started, a week after the letter of appointment went out but before they started. And I need not go any further, it's just something that I have been aware of for a number of years in this industry and there has been about a dozen disputes over it now and I have decided to try and prevent them if I can.

PN56

MR DOWNES: Commissioner, without wishing to pass it back, I certainly was not involved in the drafting agreement as Commission may recall.

PN57

THE COMMISSIONER: Look, I am not - I am sure people at the Oaky Creek underground have better things to do than read federal court and High Court decisions all their days, they leave that to people like us unfortunately. But nevertheless, they are the ones who end up in what I might call the grey area when all this unravels and that is what we are trying to prevent. But nevertheless, I am happy with the exchange we have had, I am happy that the parties will turn their minds to try and resolve this by an exchange of letters so that any uncertainties are removed.

PN58

MR CONROY: Commissioner, might I say something about that last issue you raised? I am more than happy to include that in the discussion the parties have to ensure that there is no confusion but I would just like to make it clear what our position is, with respect. And that simply is, if you are a fixed term, fixed task employee you can only be terminated prior to the expiration of that contract for misconduct, simple as that. and that is the position that we will be taking in the discussions we have with the employer and I concur - - -

PN59

THE COMMISSIONER: There may be other grounds that bring the contract to an end. Death springs to mind.

PN60

MR CONROY: I didn't mention frustration.

PN61

MR DOWNES: Commissioner, there may be a number of grants but Mr Conroy's position is not unexpected. We would expect that that could be their position and there has been an awful lot of common sense in the hammering out of this agreement on site. I have no doubt that these issues when brought to the attention of the parties is, and I would describe them as apparent tensions, they may be none at all but I am confident that an agreement can be reached on site. I don't know what would happen if it can't but that's what keeps us in bread and water.

PN62

THE COMMISSIONER: There is a disputes procedure in the agreement.

PN63

MR DOWNES: Yes.

PN64

MR CONROY: I was thinking late Friday afternoon we will be in here resolving another application.

PN65

THE COMMISSIONER: I hope not. Well, look, having had that discussion let me say that given what the parties have undertaken to do, I am satisfied that the terms of this agreement meet the requirements of the Workplace Relations Act of 1996 and I am also satisfied that the relevant rules of the Commission have been met. This agreement therefore will be certified. It will come into effect from today and it will remain in effect until 11 April 2008. I adjourn the Commission.

<ADJOURNED INDEFINITELY [9.55AM]