BP2006/3041, Transcript of Proceedings [2006] AIRCTrans 943 (10 August 2006)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996 15473-1
15474-1
15475-1

SENIOR DEPUTY PRESIDENT MARSH

BP2006/3041 BP2006/3042 BP2006/3047

AUTOMOTIVE, FOOD, METALS, ENGINEERING, PRINTING AND KINDRED INDUSTRIES UNION
AND
VISY INDUSTRIAL PLASTICS PTY LTD
s.451(1) - Application for order for protected action ballot to be held
(BP2006/3041)

NATIONAL UNION OF WORKERS
AND
VISY INDUSTRIAL PLASTICS PTY LTD
s.451(1) - Application for order for protected action ballot to be held
(BP2006/3042)

THE AUSTRALIAN WORKERS’ UNION
AND
VISY INDUSTRIAL PLASTICS PTY LTD
s.451(1) - Application for order for protected action ballot to be held
(BP2006/3047)

SYDNEY

2.19PM, THURSDAY, 27 JULY 2006

Continued from 24/7/2006

Reserved for Decision

THE FOLLOWING PROCEEDINGS WERE CONDUCTED VIA VIDEO CONFERENCE AND RECORDED IN SYDNEY

PN1705

THE SENIOR DEPUTY PRESIDENT: I don't think there's any change in appearances. Mr Smith.

PN1706

MR SMITH: Yes, thank you, your Honour. I have a folder of materials to tender.

PN1707

THE SENIOR DEPUTY PRESIDENT: Thank you. Are they two separate folders?

PN1708

MR SMITH: No, two copies of the same folder, your Honour.

EXHIBIT #AIG5 FOLDER OF MATERIALS, DATED 27/07/2006

PN1709

MS PARKES: Your Honour, if I could just briefly interrupt there. The NUW hasn't been provided with a copy of the materials. I took the liberty of ringing both Mr Smith and Ms Knowles offices earlier today requesting that any material that be tendered be faxed to the NUW by 1.30.

PN1710

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1711

MS PARKES: And to be honest, I don't know what's before you, your Honour. We haven't been provided with anything. I was advised that submissions were still being written and that it would be sent to me. So your Honour, I'm just commenting that I don't know what that exhibit is or what's in it, if the Commission pleases.

PN1712

MR NEILSON: Your Honour, I must say that we also have concerns about the nature of the exhibit given the length of it. It's been the subject that Mr Smith on numerous occasions has complained about himself and we're here today unfortunately, it could have been provided to the time frame of the last hearing until today.

PN1713

MR SMITH: Your Honour, if I can just explain what the material is before everyone objects to it?

PN1714

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1715

MR SMITH: It's a written submission which is intended to deal with the objections that were made to the fact that we may not finish today so I will be going through in detail the points in the submissions and as Ms Parkes said, a call did come into the office but this submission was finished at five to two, just as we were walking out the door, so there was just no ability to provide it any earlier and the attachments are decisions of the Commission that we were simply going to hand up anyway and copies of the union's bargaining notice which you have already got a copy of. The rest are just decisions of the Commission, so I don't see how we can be criticised for providing a written submission.

PN1716

The NUW itself gave us their written submission on the last occasion and we had no prior warning of it or time to read it.

PN1717

THE SENIOR DEPUTY PRESIDENT: Well, the difficulty is that Ms Parkes hasn't got access to the materials and she's in Melbourne. That's where the difficulty arises. Mr Neilson has made another objection but I'm more interested in Ms Parkes' objection quite frankly, because I think it is in order to hand up - there were no directions about filing witness statements or submissions and it's totally in order to provide written submissions on the day in the absence of directions otherwise and if that's to assist with the anticipated finishing time of the case, well, that's to the advantage of everybody and as you say, the other matters are decisions of the Commission and it's quite normal in proceedings to hand up and rely on decisions of the Commission.

PN1718

But my concern is that Ms Parkes is disadvantaged in the sense that she's in Melbourne and hasn't got access to the material. All I can suggest is that - there's nobody in your office in Melbourne who could get a copy to Ms Parkes?

PN1719

MR SMITH: As I was saying, your Honour, it was only finished quite literally as we were racing out the door. We're happy to wait if there was an ability to fax the submission at least through. The rest are just decisions of the Commission that are referred to and what is relevant anyway in the submission.

PN1720

THE SENIOR DEPUTY PRESIDENT: Yes, okay. Well, the alternative is that we fax it through to the Melbourne registry, at least the written submission and Ms Parkes obtains it from the Melbourne registry and then we resume.

PN1721

MR SMITH: That's fine, your Honour. It's only 20 pages so it should only take five minutes to go through.

PN1722

THE SENIOR DEPUTY PRESIDENT: Yes, all right. Is that all right,
Ms Parkes? I can't see another way of assisting you to enable the matter to be completed today?

PN1723

MS PARKES: Certainly. Your Honour, I should note I'm in court room 16 which is on the same level as the registry. The only comments I would make is depending on which of the particular cases that Mr Smith refers to, if I don't have copies of them with me I may need an opportunity to comment on those in a written submissions, but whether or not that would be case and whether my friends from the AMWU and AWU would be able to address those issues.

PN1724

THE SENIOR DEPUTY PRESIDENT: Well, it's always open to an applicant to seek a different way of processing replies in light of what's put by the respondent, so maybe in light of what transpires in the afternoon your rights are reserved to raise that issue again then.

PN1725

MS PARKES: Certainly, your Honour.

PN1726

THE SENIOR DEPUTY PRESIDENT: Mr Smith has indicated that the salient parts of the authorities are in the body of the submission. So if you're on level 16 and we adjourn and we fax this to you now it should take no more than 10 minutes at the most. I think that's going to be the best way of handling your objection. So do you mind going to the registry, otherwise we'll organise somebody to come to the court room with the copy?

PN1727

MS PARKES: Thank you, your Honour.

PN1728

THE SENIOR DEPUTY PRESIDENT: All right, thank you. We'll adjourn for a few minutes.

<SHORT ADJOURNMENT [2.26PM]
<RESUMED [2.43PM]

PN1729

THE SENIOR DEPUTY PRESIDENT: Mr Neilson.

PN1730

MR NEILSON: Your Honour, we have a number of objections to the material but we don't propose to go - well, certainly the AMWU doesn't propose to go to them in any detail during Mr Smith's submissions, suffice to say that we would ask the Commission not to draw an inference that our silence is in fact acceptance of these matters being put, that we will deal with them in reply.

PN1731

THE SENIOR DEPUTY PRESIDENT: Very well. Yes, Mr Smith.

PN1732

MR SMITH: Yes, thank you, your Honour. I don't propose, your Honour, to read all of this out but I do want to go through the points in a little detail so I can draw on the arguments.

PN1733

THE SENIOR DEPUTY PRESIDENT: Yes, well, none of us have seen it before.

PN1734

MR SMITH: Yes, thank you, your Honour. As we're aware, applications have been made by the three unions for orders for secret ballots to be held and subsection 461(1) of the Act requires that the Commission must be satisfied that the applicants have genuinely tried to reach agreement, that they are genuinely trying to reach agreement and they're not engaging in pattern bargaining and, your Honour, there's no discretion on those issues unless you are satisfied then the applications must not be granted. If there's any doubt about whether the requirements are met then we say that the applications must not be granted.

PN1735

We believe that on all three grounds the unions have failed to comply with the prerequisites for the granting of a secret ballot order. The Act of course prohibits the making of joint secret ballot applications by unions but as your Honour has done, you've applied the process under section 460 to jointly hear more than one application at the same time, but that doesn't detract from the legislative requirement that all three unions must meet the requirements of the Act. Your Honour, when assessing whether the conduct of the three unions breaches the Act we'd submit that it's highly relevant that the evidence is very clear and strong that the three unions operated as a single bargaining unit and maintained a joint position throughout the negotiations with the company.

PN1736

We'd now like to deal with the issues on the second page onwards of the submission about pattern bargaining. Paragraph 461(1)(c) states that the Commission must not grant a secret ballot application unless it is satisfied that the applicant is not engaging in pattern bargaining and the AMWU tendered a copy of a decision that's well worn now by Marshall J, but we say any notions of what pattern bargaining might have constituted prior to the enactment of Work Choices needs to be treated with caution because the term pattern bargaining now is recognised in the Act. It's expressly included in the Act and it has a particular meaning, a meaning which needs to be applied to determine whether a particular course of conduct constitutes pattern bargaining.

PN1737

The old notion that pattern bargaining as it was generally thought of was something that extended across a sector or an industry just isn't relevant any more to the requirements of the Act. Pattern bargaining occurs where a particular course of conduct takes place during the negotiation of even two collective agreements. It doesn't require that the course of conduct take place across a whole industry or sector. It's also important to note, your Honour, that pattern bargaining isn't prohibited under the Act. Employees and employers and unions are permitted to pattern bargain to their hearts content. What is prohibited is industrial action in pursuit of pattern bargaining and that's logical because the right to take protection action in pursuit of bargaining is really a right which was introduced into the Act back in 1993 for enterprise bargaining, bargaining at one enterprise and that concept has been continued since that time.

PN1738

Section 421 of the Act sets out the meaning of the term pattern bargaining as set out on page 4 of our submission with only two exceptions, pattern bargaining occurs if a union engages in the course of conduct that meets the three conditions set out in section 421(1) of the Act. Now, we submit, your Honour, that those conditions are not intended to pose a particularly high hurdle, they're simply there to characterise a particular form of behaviour as one that extends beyond one enterprise and then the nub of the issue is really is the union genuinely trying to reach agreement at the enterprise level. So the lengthy arguments and so on that report about whether the unions' behaviour met those three criteria we'd submit were missing the point because those criteria are intended to be fairly easily satisfied where a union engages in behaviour where that extends beyond one enterprise and then you get to the real nub of the issue which goes to the second exclusion.

PN1739

Now, the provisions of the Act are intended to ensure that negotiating parties who wish to take industrial action in pursuit of common claims genuinely try to reach agreement at the enterprise level and that requires that they demonstrate a preparedness to negotiate over their own claims and over the employer's proposals for the workplace agreement. It's standard practice, as everyone here, your Honour, knows for unions to develop claims and to recommend that their members pursue those claims and everyone knows that is a central activity of any union and any assertions to the contrary just have no credibility.

PN1740

Now, Mr Mitchell in particular as we heard, he was very evasive for a time but eventually he was very honest about and at paragraph 488 to paragraph 490 of the transcript Mr Mitchell was quite specific and resolute in saying that it is recommending to members in several workplaces at the present time that they would pursue standard claims to freeze award conditions and what's more, that that what he's paid to do, which of course is absolutely right. Just turning to the issues from page 5 of the submission, your Honour, clearly the three unions are negotiating parties to two or more collective agreements. The figures from the official database show there are 940 certified agreements in the manufacturing industry which have now expired.

PN1741

Everyone knows that there is bargaining going on everywhere. The Commission itself knows that as it has matters before it regularly and of course those three unions, the AMWU, the NUW and AWU are key unions within the metals trades federation of unions. They're parties to dozens and in some cases hundreds of agreements amongst that group and it is uncontested, I would have thought, that the unions are involved in a great deal of bargaining at the present time. Now, accordingly we say the unions are negotiating parties to two or more collective agreements and the condition in paragraph 421(a) must apply.

PN1742

Now, with regard to the conditions in (b) and (c) they're also clearly applicable. The unions are involved in a course of conduct which involves seeking common wages and conditions for two or more agreements and clearly as set out in (c) that conduct extends beyond a single business and currently the three unions are involved in common claims and the claim that we wish to highlight in particular is the common claim for the freezing of award conditions. In paragraph 22 we've set out some of the relevant extracts from the evidence, firstly the point that the same union officials are representing employees in more than one workplace in collective agreement negotiations and are pursuing the common claim for the freezing of conditions and they're guiding their members to pursue that claim and the statements which we've highlighted there by three of the union officials to that effect.

PN1743

Over the page on page 6 there is evidence that union delegates from many workplaces meet at common venues to formulate and endorse common claims and Mr Reid talked about the conference that he couldn't remember whether he'd been there for the whole conference. He thought he walked out after half an hour but he didn't deny that a key agenda item at that conference goes to the issue of bargaining claims. And of course there is exhibit AIG4 which is a bargaining manual which the AMWU encourages its delegates to use and - - -

PN1744

THE SENIOR DEPUTY PRESIDENT: Can I just take you back a bit, you're saying under the legislation common claims means a common claim, not all claims in common?

PN1745

MR SMITH: A common claim, yes, where you look at - because, your Honour, I go back to my other point - - -

PN1746

THE SENIOR DEPUTY PRESIDENT: Is that the thrust of your submission and an example of a common claim is the freezing of award conditions?

PN1747

MR SMITH: Yes, but we say - - -

PN1748

THE SENIOR DEPUTY PRESIDENT: But it doesn't matter if every other clause or term of an agreement being negotiated was different? If you've got one common claim you're pattern bargaining if you meet the other conditions of 421?

PN1749

MR SMITH: Yes, your Honour, and AI Group was heavily involved in these provisions.

PN1750

THE SENIOR DEPUTY PRESIDENT: Well, that doesn't - - -

PN1751

MR SMITH: No, no, I'm not saying that, your Honour, but I've been extensively involved in - - -

PN1752

THE SENIOR DEPUTY PRESIDENT: A lot of legislation does not reflect what the authors or those making an input thought it would or contended for. I'm saying that in all seriousness, you know, that what the parliamentary draftsmen draft may not reflect the intent of a party who is involved. So you're saying you have one common claim such as a wages claim or a 38 hour week claim, national standards may be exempt, an annual leave claim, that means it's pattern bargaining if the other criteria are met?

PN1753

MR SMITH: Yes, your Honour, but the other criteria are central to it. The other criteria, particularly the second exclusion, is really a bit like Munro Js decision relating to the Campaign 2000 case where the decision was recognised in that note under 170MW(2), it goes to the criteria that was central to pattern bargaining. So this simply delineates behaviour that is across more than one workplace. It's intended to be easily met we'd submit and then the nub of the issue goes to other genuinely try to agreement. It can't possibly mean every claim because how could it possibly mean every claim, we'd submit. It means common wages and conditions and that clearly the one we've used as the example is common conditions.

PN1754

THE SENIOR DEPUTY PRESIDENT: Well, it says common wages or conditions of employment. It does say a common condition.

PN1755

MR SMITH: No, but common conditions, your Honour, this is common conditions because it's talking about the freezing - - -

PN1756

THE SENIOR DEPUTY PRESIDENT: I mean I'm not being pedantic, I just really want to understand your submission.

PN1757

MR SMITH: Yes, it common conditions. This is the freezing of a whole award essentially. Now, that award contains a large number of conditions.

PN1758

THE SENIOR DEPUTY PRESIDENT: But doesn't conditions mean all conditions?

PN1759

MR SMITH: No, your Honour, absolutely not.

PN1760

THE SENIOR DEPUTY PRESIDENT: It doesn't?

PN1761

MR SMITH: No, it couldn't possibly mean that, your Honour, because that would mean that you'd have to have exactly the same agreement and this is intending to, as I said, be a form of behaviour that just simply delineates where something common is happening across more than one workplace. Then you go to the issue is the union genuinely trying to reach agreement about those common claims. It couldn't possibly mean every single item in the agreement, your Honour. It couldn't possibly because there would be things that differ like all of the provisions about where the agreement applies, you know, who the agreement applies to, you know. Terms of two different agreements are always going to be different because they apply to different people. But this we'd submit very strongly falls within that.

PN1762

THE SENIOR DEPUTY PRESIDENT: So you're saying, just let me encapsulate, you're saying that 421(b) is met because there's evidence that there's a claim for freezing of the conditions of the relevant parent award?

PN1763

MR SMITH: That's right and there is a typo in the submission, your Honour, because it should say common wages or conditions of employment, sorry, rather than and conditions of employment. So paragraph 13 says:

PN1764

Seeking common wages or conditions of employment.

PN1765

Which is what (1)(b) states.

PN1766

THE SENIOR DEPUTY PRESIDENT: What the legislation says, yes.

PN1767

MR SMITH: And in this case common - - -

PN1768

THE SENIOR DEPUTY PRESIDENT: But in this case relying on common conditions.

PN1769

MR SMITH: Yes.

PN1770

THE SENIOR DEPUTY PRESIDENT: And the common conditions is a common claim for the freezing of the conditions of the relevant parent award.

PN1771

MR SMITH: That's exactly right, your Honour, yes.

PN1772

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1773

MR SMITH: And as we've said, the nub of the issue is that really the second exclusion. Now, the standard practice is for unions to develop claims and to recommend to their members that they pursue those claims. The course of conduct, as I was saying on page 6, goes to this issue of the union delegates, the bargaining manual that's been distributed and Mr Reid and Ms Seagrove admitted that they had seen that bargaining manual, that they were aware of the bargaining manual and so on in the extracts that are there.

PN1774

Now, the bargaining manual sets out a series of draft clauses which the delegates are encouraged to pursue and there's some relevant extracts from that manual on pages 6 and 7, including the delegates tip which talks about -

PN1775

The following draft clauses are provided to help you ensure that your members keep terms and conditions.

PN1776

And so on. We say, your Honour, as set out in paragraph 25 of our submission that the evidence establishes that particularly union organisers are currently pursuing a course of conduct of pursuing common conditions in the form of a common claim for the freezing of award conditions across more than one workplace.

PN1777

THE SENIOR DEPUTY PRESIDENT: So it's the concept, and I talked about Mr Neilson about this, in your submission it's the concept of freezing award conditions regardless of what the award is?

PN1778

MR SMITH: Yes, and I go - - -

PN1779

THE SENIOR DEPUTY PRESIDENT: You can't the rubber, plastics and cable making is different from metals therefore it's not a common claim?

PN1780

MR SMITH: That's right, your Honour. I am going to address quite specifically.

PN1781

THE SENIOR DEPUTY PRESIDENT: Are you? All right. Because that was, yes, a fairly important part of his submission on - - -

PN1782

MR SMITH: And it's really set out in detail on pages 7, 8 and 9.

PN1783

THE SENIOR DEPUTY PRESIDENT: All right. Sorry, I haven't obviously got there yet.

PN1784

MR SMITH: No, that's fine, your Honour, because it is a key point and the unions we say made a half hearted attempt with that argument, that it breaches 421(b) because it was alleged that because they weren't pursuing a claim for the same award or they allege that they may not be and we say that's a very creative argument because if you go to the dot points on pages 8 and 9, your Honour, are set out in tab 1 of the folder, the unions notices to initiate a bargaining period which I couldn't find the AMWU and the AWU ones this morning, your Honour, but you have a copy of the NUW one because it was provided as part of the application but it wasn't served on us.

PN1785

They describe their claim as maintenance of award conditions. That's the way they characterise their claim and we say that it's a claim for freezing the conditions in the relevant parent award and it's a claim that's being pursued by each union across many workplaces and the union officials we say admitted that. They admitted they were pursuing a common claim for the freezing of award conditions and we say, your Honour, that if it was a central point that the unions sought to rely on then they should have when they re-examined their witness or during the original examination established that this claim was a different claim.

PN1786

It's logical to assume that the same parent awards are in operation in various workplaces and that they contain same or similar conditions. Now, the two parent awards, if you look at the Metals Award, it applies to an extremely large number of workplaces. In tab 2 there's an extract from your award simplification decision, your Honour, at that stage it was cited that it applied to 149,900 employees on the latest survey and there's something like 10,000 workplaces or 12,000 workplaces. The Rubber, Plastic and Cable Making Award, as your Honour would be certainly aware that I was heavily involved in the Metals Award, but I also negotiated the simplification of the Rubber, Plastic and Cable Making Award with an official of the NUW and we started with the Metals Award and we only changed clauses which were directly relevant.

PN1787

So the awards mirror each other in many, many respects and there are a few changes here and there with shift loadings and so on. That was the way that we negotiated it. So many, many of the conditions, the vast bulk of the conditions in those two awards are exactly. Now, the third dot point is that the AMWU delegates bargaining manual contains a claim on page 6 for the freezing of the conditions in the Metals Award. It specifically cites the Metals Award and
Ms Seagrove and Mr Reid admitted that that was the claim, you know, the one out of the bargaining manual that - well, we say they did and the extracts are there and that that's claim being pursued across more than one workplace. I have dealt with that issue on page 9, the final dot point about the breadth of the Metals Award, the fact there are 940 agreements in the manufacturing industry that have expired.

PN1788

We say it's reasonable to assume that there's a common claim that the unions are clearing pursuing, set out in their bargaining manual is being pursued across more than one workplace because it only needs to be pursued in two workplaces and that hurdle is met. Now, another creative argument we say, your Honour, that the AMWU ran related to the intent of section 355 and we say that argument completely fails to comprehend the obvious intent of the pattern bargaining provisions of the Act. This is the section that lets in a limited way an agreement import by reference terms from awards and other industrial instruments. But again it goes to this issue that this is about the pursuit of common claims with industrial action.

PN1789

Nothing stops unions pursuing common claims or companies agreeing to common claims. This is about whether genuine bargaining is occurring about those common claims and whether industrial action is able to be taken. So there's no conflict at all with section 355. You could have 100 workplaces with identical agreements if they all want them, but this is about industrial action rights in pursuit of common claims. So your Honour, in summary as set out in paragraph 28 there we submit that it is very clear that each of the unions has engaged in a course of conduct which meets the criteria set out in paragraphs (a), (b) and (c) of section 421(1) and that means that unless one of the two exceptions apply then the unions are engaging in pattern bargaining as defined and that the Commission must refuse the secret ballot application.

PN1790

Now, the first exception doesn't apply because it's about the pursuit of national standards determined by a Full Bench. So it goes to whether the second exclusion is relevant. Now, paragraph 3 to 6 we say are relevant, paragraphs 3 to 6 of section 421. Now, paragraph 3 excludes a course of conduct if the negotiating party is genuinely trying to reach an agreement for the business or part and that term has a particular meaning for the purposes of the pattern bargaining provisions and paragraph 6 is relevant, your Honour, because it specifically says there that the definition of genuinely trying to reach agreement for the pattern bargaining provisions doesn't affect or is not affected by the meaning of that term in other parts of the Act, like the section dealing with suspension or termination of bargaining periods for example.

PN1791

Paragraph 431(4) sets out various factors relevant to working out whether a negotiating party is genuinely trying to reach agreement for the single business or part and we say, your Honour, that unions course of conduct breaches several of the factors and the ones that we say are breached are set out in paragraph 34 of our submission. We say the unions haven't demonstrated a preparedness to negotiate an agreement which takes into account the individual circumstances of the business or part. We submit that they're not negotiating in a manner consistent with wages and conditions of employment being determined as far as possible by agreement between the employer and the employees at the level of the single business or part and we submit that the unions have not considered and responded to proposals made by the employer within a reasonable time frame.

PN1792

Now, your Honour, the term demonstrating a preparedness to negotiate is a very tangible and specific concept. It requires that the unions take positive actions to demonstrate that they have complied with that section of the Act. Now, the case cited by the AMWU, that decision of Marshall J was obviously not only I think from memory it - I just have to get the timing right but I think it was 1996, but he was comparing the concept of genuinely trying to reach agreement with the concept of good faith bargaining that was in the Act when the Labor Party was in power so it must have been around that time. But we say that is irrelevant now because this is a new set of words and a new concept.

PN1793

It requires demonstrating a preparedness to negotiate and the fact that the unions have refused to genuinely negotiate over the company's enterprise bargaining proposals, they have rejected all of the company's proposals which they say in their witness statements, demonstrates that the unions are not genuinely trying to reach agreement and they have not genuinely tried to reach agreement for the purposes of section 421. The evidence that we point to, your Honour, is that, as I've said, each of the unions has rejected the company's proposals and the relevant extracts from the evidence are cited. Secondly, that between 2 June and 13 July the parties didn't meet to negotiate over the agreement, although the company maintained that it was prepared to do so.

PN1794

Ms Seagrove, this is a very important point, your Honour, gave evidence that she last reported back to the employees on 3 July. She also gave evidence that she'd not been involved in any workplace agreement negotiations at that point and therefore it's evidence that the lead union negotiator amongst the unions has still not discussed key details of the company's enterprise bargaining proposals with the employees. Now, on 3 July the details of the bonus scheme hadn't even been released because as the evidence of Mr Ryan and Mr Kroon showed, they were intending to table the details of the bonus scheme on 2 June but the unions walked out of the room before they were able to do so because the company wouldn't accept the unions claims, so those details weren't tabled until 13 July and
Ms Seagrove, the lead negotiator, had not even seen them when she reported back to the employees and she gave evidence that that was the last time she reported back to them.

PN1795

A key company proposal for the agreement, as I've said, is the bonus scheme. It's been rejected outright. And another point that Ms Seagrove made, she said the bonus scheme has not even been addressed by the employees. She made that specific statement at paragraph 410 to 411, it has not even been addressed by the employees. And the AWU acknowledged that it has not discussed the bonus scheme with its members since May and that was of course before any of the details were tabled by the company on 13 July. Now, the unions argument that we breached the evidentiary rule in Jones v Dunkel in respect of the evidence about pattern bargaining has no merit, your Honour.

PN1796

This principle, as we understand it, simply stated that if a party fails to call a witness whom that party might reasonably be expected to call then it can be inferred that the evidence that the witness could be expected to give would not have happened the party. Now, three points we want to make here, there's no obvious witness that we failed to call. If it was asserted that somehow or other someone like me should have been a witness there is a decision of your Honour actually in a case which I can get the reference to which was along the lines that advocates that put matters from the bar table that is entitled to be taken as evidence by the Commission to the contrary of any alternative - or any objection. I will get you that reference in a moment, your Honour, given that I’m citing it.

PN1797

THE SENIOR DEPUTY PRESIDENT: How long ago was that?

PN1798

MR SMITH: It's a Full Bench decision that you were on. About five years ago, your Honour. I have got - I shouldn't have mentioned it before I had the reference but I will find it for you in a second. But that isn't one of the three key points anyway, your Honour. Firstly, there's no obvious witness that we failed to call. Secondly, the obvious relevant witnesses in support of our case are Mr Reid,
Ms Seagrove, Ms Issanchon and Mr Mitchell, and we couldn't call those witnesses because the unions had already called them, or in the case of three of them. So how could we be breaching the rule in Jones v Dunkel when our witnesses, our key witnesses had already been called by the other party?

PN1799

Thirdly, it was always our intention to rely on the union officials for our evidence and we're entirely within our rights to do so. The evidentiary point that we needed to establish was that the union officials are engaging in bargaining across more than one workplace, so obviously the union officials are the ones that we need to rely on. Now, more importantly, your Honour, it would be very dangerous we submit for this Commission to give much weight to evidentiary rules such as the rule arising from Jones v Dunkel and we cite here sections 109, 110(1) and 100 of the Act which make it clear that the Commission is not bound by rules of evidence and must avoid unnecessary technicalities and I want to go to those issues in some detail a little later, your Honour.

PN1800

THE SENIOR DEPUTY PRESIDENT: Yes, but we're also bound to follow the principle of procedural fairness and natural justice.

PN1801

MR SMITH: Yes, your Honour, and I'll go to those issues in some detail. Your Honour, so the next section that I want to deal with is the fact that the unions have made their agreement to the formal agreement conditional upon agreement to a deed of agreement or a memorandum of understanding. Now, it's uncontested we submit, your Honour, that the unions have been pursuing a deed or an MOU to deal with the prohibited content items throughout the course of the negotiations and that they're still pursuing that. Now, the following evidence as set out in our written submission goes to the fact that the key aspects of the workplace agreement negotiations has always been the pursuit of a deed and we'd submit the unions have made agreement on the formal workplace agreement conditional upon agreement on the deed.

PN1802

Now, firstly, your Honour, both the AMWU and NUW tabled draft deeds containing prohibited content at the initial enterprise bargaining meeting on
25 January and there are witness references there to point to the relevant evidence on that. Over the page on page 14 of our submission the next page is at the meeting on 25 January Mr Mitchell endorsed the joint union position of pursuing a deed. Now, Mr Mitchell, as we know, gave evidence that he wasn't at the meeting but both Mr Ryan and Mr Kroon gave evidence that he was at the meeting and we tried to tender the notes of the meeting unsuccessfully that show that he was - okay.

PN1803

The third point is at the initial enterprise bargaining meeting on 25 January the unions said that their three key objectives for the enterprise bargaining negotiations were firstly to preserve existing terms and conditions, to reach agreement on the deed and thirdly, to increase wage rates and allowances and that was set out in Mr Ryan and Mr Kroon's witness statements and they were adamant in the witness box that that was the case. It's very clear that the three unions operated as a single bargaining unit throughout the negotiations and had a consistent position on the deed and the unions accepted that point, or a number of the union officials did and the references are there.

PN1804

Now, the next point is that the pursuit of the deed to protect prohibited content was endorsed by Visy's employees at a meeting convened by the unions in February. Mr Reid made that point. The claim for the deed was discussed at several EBA report back meetings to employees. Ms Issanchon and Mr Reid accepted that and the references are there. Over the page on page 15, the claim for the deed has not been withdrawn and is still being pursued by the employees and the unions and I don't think that is contested because the union officials, not one of them said that they were not still seeking the deed. The unions are pursuing deeds to protect prohibited content in workplace agreements across the manufacturing industry. There's an extract there citing Ms Seagrove.

PN1805

Of course there's exhibit AIG4 and Ms Issanchon expressed a view, you will recall, your Honour, that in fact one of the other workplaces she was involved with, De Marchi Packaging indeed was being pursued there. Finally we have the evidence that the unions have made their agreement to the formal workplace agreement conditional upon the deed and Mr Ryan and Mr Kroon gave evidence which they were unflinching on in the witness to that effect and Ms Seagrove did make some statements about the issue and she also though did admit that she had said something at a meeting about the fact that there may be a problem, but I'll come to that statement in a moment.

PN1806

Now, it's clear, your Honour, that there's some conflict in the evidence on some points and Mr Ryan and Mr Kroon gave evidence that Mr Mitchell was at the meeting on 25 January. Mr Mitchell gave evidence that he was not. Secondly, Mr Ryan and Mr Kroon gave evidence that at a meeting on 13 July Ms Seagrove said words to the effect of reaching agreement on the EBA is reliant on the parties also reaching agreement on the illegal or prohibited content issues in the deed or MOU. Now, Ms Seagrove gave evidence that she did not say that, although she did admit that she said to the company that its refusal to agree to the deed or MOU could cause a problem for us, but she alleged that was at a meeting on
6 July.

PN1807

Now, Ms Issanchon gave evidence that Ms Seagrove didn't say the words that the company alleges she said at the meeting on 13 July but if I recall correctly, she was not at the meeting on 6 July. I might be wrong on that point but I think that was the case. Now, over the page, your Honour, on page 16 we say that even if the Commission is not convinced that Ms Seagrove said words to the effect of those set out, the surrounding circumstances and the other evidence clearly proves that the unions have made their agreements to the formal workplace agreement contingent on agreement to the deed or MOU. And further, if the Commission is not totally satisfied that the alleged words were not said by Ms Seagrove, then section 461 requires that the unions' applications be refused.

PN1808

Now, the unions unsuccessfully attempted to have Mr Ryan and Mr Kroon's evidence struck out on the basis of the evidentiary rule in Browne v Dunn and they tabled a 15 year old decision of Munro J. It was a brave decision we say, your Honour, to table that because if you go on from the extract that was cited by the unions Munro J went on to say that:

PN1809

I have not applied this rule with rigour in this case.

PN1810

So a 15 year old decision and, your Honour, there's a very recent decision of a Full Bench about the Browne v Dunn decision that's a very extensive - sorry, the Browne v Dunn rule that was very extensively considered and that decision is set out in tab 3 and I'd like to go to that issue now. Your Honour, I did take the liberty while your office was faxing through the submission to get our office to fax through these three decisions to the registry in Melbourne. I'm not sure whether they've been delivered yet.

PN1811

THE SENIOR DEPUTY PRESIDENT: Ms Parkes, have they been delivered to you?

PN1812

MS PARKES: I have the first pages of the Rheem decision and that is it, so it hasn't yet got to the decision, it's more the parties submissions. So I've got the first four pages of Rheem but I don't have anything else. It may be that it's still in transit to the registry or that there's an issue at this end of the registry, I don't know, but that's all that I have been given.

PN1813

THE SENIOR DEPUTY PRESIDENT: We can check out the situation in the registry.

PN1814

MR SMITH: Your Honour, I'll be going to the issues in the decision anyway. Just as a courtesy I thought we would - - -

PN1815

THE SENIOR DEPUTY PRESIDENT: Yes, thank you.

PN1816

MR SMITH: Your Honour, this decision contains some highly relevant sections. If I can go to those paragraphs that I refer to our written submission which are paragraphs 20 to 22 and 26 to 31. So the first point on paragraph 20, it says here:

PN1817

The applicant's statement contains a denial of unauthorised absences from the work station in May 2003. She was not cross-examined on that ...(reads)... that ultimately resulted in the applicant's dismissal.

PN1818

And then very relevantly, your Honour, over the page at paragraph 21 it says:

PN1819

The rule in Browne v Dunn is much misunderstood. Advocates frequently assert that the rule obliges the Commission to accept evidence ...(reads)... hasten do not apply to counsel -

PN1820

et cetera, "in this case". And it goes on to in a very lengthy way set out the extracts from that old decision. But your Honour, paragraph 22 over the pages says:

PN1821

We interpose to observe that the speeches in Browne v Dunn recognised a key issue will be whether the witnesses had notice of what was to be ...(reads)... no notice that those allegations would be made.

PN1822

If I could take your Honour to paragraph 26 now over the page, a few pages. This says:

PN1823

A particular consequence of this summary of principle by the Full Court is that there may often be little scope for the operation of the rule in ...(reads)... fairness in a particular case.

PN1824

Over the page in paragraph 27 the Full Bench said:

PN1825

The consequences of a breach of the rule in Browne v Dunn will also vary depending upon dictates of fairness in the particular ...(reads)... has been expressly rejected by Samuels J.

PN1826

And the extract is there. Just if I can point to a few other extracts, your Honour. Paragraph 28 says:

PN1827

The rule in Browne v Dunn is fundamentally a rule of fairness in relation to the way in which the fact finding process ought be proceeded. It should ...(reads)... aspects of his or her evidence.

PN1828

Then in paragraph 29 the Full Bench said:

PN1829

The Commission is not bound by any rules of evidence. Pursuant to that provision the Commission may inform itself of any matter in such manner ...(reads)... will apply in an appropriate case.

PN1830

And then in paragraph 30, your Honour, the Full Bench said:

PN1831

Equally the impact of the fact finding process of a failure to cross-examine a witness in aspects of his or her evidence is ultimately a matter of ...(reads)... factual findings that were relevantly unfair.

PN1832

Now, those observations apply equally to the rule in Jones v Dunkel. Then, your Honour, this is almost exactly the same as the arguments that were being put in this case. You can see in paragraph 31 the Full Bench said:

PN1833

In the present we are not satisfied that the Commissioner erred in this way. In the present case we are firmly of the view that the rule in Browne v Dunn properly understood did not require the Commissioner to accept and act on the unchallenged evidence.

PN1834

Then the most important point, your Honour, is that third paragraph down on page 12 that says:

PN1835

The filing and service of witness statements in the present matter has put the applicant squarely on notice that the unauthorised or unduly ...(reads)... the Commissioner has formed as to her credit.

PN1836

The decision, your Honour, also deals with the Jones v Dunkel evidentiary in paragraph 32 to 35 which I talked about a little earlier and as it says here, your Honour, in paragraph 32:

PN1837

The applicant submitted that the Commissioner erred not drawing a Jones v Dunkel inference from the failure of the respondent to call employees who had witnessed the applicant's absences.

PN1838

If I could take you to paragraph 34 and 35 just finally with this decision, your Honour, the third sentence down in paragraph 34 it says:

PN1839

Absent an error of principle, breach of the rule in Jones v Dunkel will give rise to error on the part of a member at first instance if ...(reads)... in relation to the absences -

PN1840

etcetera. So your Honour, it's very surprising that the unions didn't point to this case that extensively dealt in very recent times with the two authorities that they sought to rely so heavily upon but we think those principles don't apply and as you're aware, your Honour, on the key point of the evidence of Mr Ryan and
Mr Kroon about what Ms Seagrove put, Ms Seagrove was recalled to the witness box anyway and the allegations were put to her, so we don't see a lot of relevance in Jones v Dunkel or the other case. But to the extent there is any relevance we think that decision just totally ousts any relevance.

PN1841

THE SENIOR DEPUTY PRESIDENT: Excuse, Mr Smith. Ms Parkes, you've just received the fax?

PN1842

MS PARKES: The complete fax, yes, your Honour.

PN1843

THE SENIOR DEPUTY PRESIDENT: Yes. The registry indicated to my associate there were 49 pages so I don't think they could be criticised for getting it to you at this time, in this time frame. Having said that, I note that you've reserved your rights with respect to a reply and we'll deal with that later on.

PN1844

MS PARKES: Thank you, your Honour.

PN1845

THE SENIOR DEPUTY PRESIDENT: Yes, Mr Smith.

PN1846

MR SMITH: Your Honour, what I did try to do there even though I took a little time, was to read out quite extensively the section so that Ms Parkes was not disadvantaged by what I was referring to. Your Honour, the Commission is not bound by rules of evidence for a very good reason and these reasons are set out in the Full Bench decision in tab 4 which is a decision of a Full Bench headed up by Giudice J and the extracts here that I would like to rely on is set out in the written submission anyway, your Honour, at the top of page 17 where the Full Bench said:

PN1847

The Commission has traditionally been relatively informal in its proceedings and processes having regard to the resources and ...(reads)... are governed by section 110.

PN1848

We'd point, your Honour, to section 109 and section 110(1) where, as we're all aware, the procedure of the Commission is at your discretion, your Honour. You're not bound to act in a formal manner. You're not bound by any rules of evidence. You can inform yourself of any matter that you consider just but you must, your Honour, perform your functions in a way that avoids unnecessary technicalities and facilities the fairer and practical conduct of any proceedings. And as your Honour pointed out before, the Commission must act according to equity, good conscience and substantial merits of the case, but again without regard to technicalities and legal forms.

PN1849

It's also noteworthy, your Honour, that section 100, a new section in Work Choices and a modified section from what was there before but basically the same principles is still there, exactly the same principle are there, that legal practitioners are only able to appear in this Commission with leave and only if certain grounds are established. Now, to the extent that people might think that that's a bit dated, it can't possibly be dated because the Act has just had a massive revision, a whole new workplace relations system has been implemented, section 100, 109, 110 appear in the revised Act, so clearly it's parliament's intention that the Commission continue to remain a place where legal technicalities have no place and the Commission adopt a practical approach in searching for the truth and the sort of tactics adopted by the unions in this matter we say should have no place in this place.

PN1850

Now, the nature of these proceedings also, your Honour, we say in paragraph 53 of our submission and the lack of time which the parties had to prepare evidence and arguments is also relevant. This is a case with complex arguments about new provisions of the Act that was run in a very short time frame, your Honour. Not only did we have to get the evidence together, we had to prepare the arguments. There's a lot of analysis involved and we submit that it would be very unfair to impose the same standard on the parties as what might be expected if the parties had time to run a substantial case like this which would have happened in a different type of application and we're not criticising the Commission.

PN1851

It is an application that had to be dealt with quickly but the practical approach that the Act requires we say is highly relevant here because there are only so many hours in the short period of time before we had to appear here to run our case. Now, these issues are also relevant when the Commission is weighing up the way the case was conducted and I've got to say, your Honour, I've found some of the assertions quite offensive, the assertions for example in the NUWs statement that sort of went to the fact that somehow or other we - and I don't want to put the wrong spin on it, but that we've been almost unethical.

PN1852

I've been dealing for 20 years with these three unions at the most senior level and I absolutely have conducted myself in this case, as has Ms Kelly and I would like to think there wasn't any such assertion, but the statements I found quite offensive and also the union assertion that the company representatives were lying. Now, that term was used in the NUWs submission and we find that highly offensive. The minor variations in the evidence of Mr Ryan and Mr Kroon aren't surprising. We think that both witnesses came across as entirely credible. They answered all questions clearly and truthfully. They weren't evasive and in contract some of the union witnesses were highly evasive and we point to Mr Mitchell who was almost comical in his avoidance of asking the question about freezing award conditions.

PN1853

Eventually he answered it quite definitive with his answer but it took a couple of pages of transcript to get an answer. Now, the unions also tried to make something out of the fact - - -

PN1854

THE SENIOR DEPUTY PRESIDENT: I thought the finding on lying arose out of paragraph 23 in Mr Ryan's statement that Ms Seagrove had said certain words or to effect certain words about the agreement on the collective agreement being relied on agreement on the deed and where the finding of lying came was that she denied and that therefore someone's lied and therefore I've got to decide who lied and hence why I said to the parties when I heard the matter last week that they were leading me and themselves into very dangerous waters in an industrial situation where there's long term past and forward relationships and industrial - - -

PN1855

MR SMITH: Yes, your Honour.

PN1856

THE SENIOR DEPUTY PRESIDENT: And it was for that very reason that somebody has lied.

PN1857

MR SMITH: Well, your Honour, it's not quite - - -

PN1858

THE SENIOR DEPUTY PRESIDENT: I don't think it was meant to be offensive in the sense other than a legal sense of where there's a conflict of interest on the balance of probabilities you're required to say that someone's right, someone's wrong in terms of were the words uttered or weren't they and that's the very reason I pointed out to the parties that they were in very, very - it was a very grave - I used the word grave deliberately, environment in which I was being asked to make findings for that very reason that now you're saying you're offended by it.

PN1859

MR SMITH: No, I'm offended by your comments, your Honour.

PN1860

THE SENIOR DEPUTY PRESIDENT: And I quite frankly wasn't thinking about you. I was thinking about the parties at the Visy Villawood site having to have a relationship where it's being said that someone's lied or someone hasn't lied.

PN1861

MR SMITH: No, your Honour, you misunderstand.

PN1862

THE SENIOR DEPUTY PRESIDENT: Have I?

PN1863

MR SMITH: I'm not being critical at all of your Honour's comments because your Honour comments I agreed with - - -

PN1864

THE SENIOR DEPUTY PRESIDENT: No, no, no, no. I'm ..... the NUW I think saying - you're saying that, you know, there was some minor variations. I don't think that's where the lying is. That was just to say, well, it goes to credit. It wasn't saying it goes to lying. I might be wrong but that's the way I read the union's case. It's that critical paragraph 23 is the agreement continued on the deed hence the Cadbury Schweppes application where someone's lied because some of them said Ms Seagrove said the words and Ms Seagrove has said she didn’t' and Ms Issanchon has said she didn't either, that's all.

PN1865

MR SMITH: Well, your Honour, I'm not putting a sort of legal point on the term lie.

PN1866

THE SENIOR DEPUTY PRESIDENT: No, no, no.

PN1867

MR SMITH: But to me it goes to that issue that you were saying is it the situation where the advocates and the company representatives are involved in ongoing dealings and in that submission from the NUW not only did it say the company representatives lied and it missed the point about the company representatives saying words to the effect of and tried to make a big deal out of the fact that it was word for word. They were saying words to the effect of, but it also said the way this case has been conducted by the respondent.

PN1868

THE SENIOR DEPUTY PRESIDENT: Yes, yes, true.

PN1869

MR SMITH: And it also went to the error that was made and it was quite a genuine error with everything that was going on that I forgot to ask Mr Kroon when he hopped in the witness box whether he wished to make any statements and I thought the way that all panned out it showed absolutely that no-one had done anything untoward there and to try and say somehow or other we've been unethical I just find grossly offensive. Now, that might just be me. But the unions tried to make something out of the fact that there were similarities in some of the witness statements, well, the two witness statements of the company. That was when they were not trying to make something out of the differences but we point to the fact that that's a bit rich because the three union affidavits are almost word for word the same thing.

PN1870

So, you know, it's a bit rich to point to a few sentences here and there into company witness statements that were prepared at short notice given the way the case had been called on when you've got three affidavits that there were, you know, weeks or months or whatever to prepare that were almost word for word from the union.

PN1871

THE SENIOR DEPUTY PRESIDENT: Yes, yes, they are, yes.

PN1872

MR SMITH: The evidence we say shows that the unions have made and they're continuing to make their agreement to the formal workplace agreement conditional upon agreement to the deed. The evidence also shows, we say, that the unions were not prepared to seriously consider the company's enterprise bargaining proposals in part because they haven't been prepared to agree to the deed and accordingly we say the unions are not genuinely to try reach agreement and have not genuinely tried to reach agreement.

PN1873

Your Honour, if I can point to 17 November decision of a Full Bench in the Wattyl case and this is tab 5. Now, Ms Parkes has a copy of the extract anyway because it's reproduced in the decision of SDP Acton in the Cadbury Schweppes case which was tendered by the AMWU.

PN1874

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1875

MR SMITH: At paragraphs 18 and 19 in tab 5 we say, your Honour, this is right on point. Paragraph 18 it's set out there that there was a document included in the claims that were part of the negotiations and that was an item called deed on PRDs or other matters not pertaining and over the page on page 6 of the decision, still that paragraph 19, sort of halfway through - sorry, paragraph 18, halfway through the section at the top of page 6 there's a sentence that says:

PN1876

It would be artificial to find that the industrial action was taken in support only of the matters which pertain, unless there was some evidence ...(reads)... the claim which does not pertain.

PN1877

Now, in this case, your Honour, there was clear evidence given by all of the union officials that they're still pursuing the deed. In paragraph 19, about the third sentence it says:

PN1878

The claim for a deed has not been withdrawn and was part of the LHMUs final offer at the time the industrial action was threatened. The inference ...(reads)... including the claim for the deed.

PN1879

And it goes on to say:

PN1880

The action would therefore not be protected. If the LHMUs contention were correct, protected action could be taken in relation to ...(reads)... wholly of matters which do pertain.

PN1881

But we say, your Honour, that right on point the claim for the deed has not been withdrawn, it's simultaneously being pursued and it is very artificial. Your Honour will recall no doubt that interchange with Mr Reid where he was trying to say that the meetings relating to the deed were different meetings to the meetings about the agreement but they took place at the same table, on the same day and somehow or other there was a line drawn between one meeting and the other which we say is just nonsense, your Honour.

PN1882

In paragraph 58 we point to the decision of Senior Deputy President Act in the Cadbury Schweppes and in particular at paragraphs 49 to 55 and I won't go through all of those paragraphs, your Honour, but as you would be well aware and the unions are well aware, this is a very central decision that we say again is right on point. In this case her Honour found that the parties weren't genuinely trying to reach agreement over the formal enterprise agreement because they were simultaneously pursuing the deed and in this case there's very similar evidence. The unions have not been prepared to genuinely consider the company's proposals and in particular the bonus scheme that hasn't been discussed with the employees since it was tabled, the lead negotiator wasn't even aware of the details of it and the other points that we have pointed to.

PN1883

There's one final key argument, your Honour, that we'd like to deal with and that is a related argument that industrial action if it were taken would be in pursuit of claims which included prohibited content. Now, we say despite the declaration which the union's have made in accordance with 453(4) that they're not seeking to organise industrial action in pursuit of prohibited content the evidence shows that the opposite is the case. Now, the deed is a live claim which is being pursued during the negotiations and any industrial action which is taken would have the obvious effect of imposing pressure on the company to agree to the various union claims including the claim for prohibited content to be dealt with in a deed.

PN1884

Now, the statement of Ms Seagrove is an important statement that we say did occur but this clearly goes to the character of the circumstances surrounding the pursuit of the deed and even without a finding in the company's favour on that statement, clearly the deed is part of the overall set of claims that are being pursued and for all practical purposes the industrial action which the unions are seeking to organise will be in pursuit of claims including prohibited content and there's a whole series of decisions that are relevant here that are well worn, your Honour, the High Court's Electrolux decision, Wesfarmers decision, which goes to this issue that if industrial action is being taken over a basket of claims and one of those claims is for a matter which does not pertain, then industrial action is lawful and obviously the Rheem decision that I've highlighted is relevant there as well.

PN1885

So in conclusion, your Honour, we submit that it's clear on the evidence that the requirements of subsection 466(1) of the Act have not been met by any of the three applicants. The evidence clearly shows that the unions are not genuinely trying to reach agreement, that they have not genuinely tried to reach agreement and that they're engaging in pattern bargaining. And further we submit that if the Commission has any doubt about whether the requirements of 461(1) have been met then the applications must not be granted.

PN1886

In order to grant the applications, your Honour, the Commission must be satisfied and a legislative requirement, as I said at the start, that the three unions must individually establish that they've complied with the requirements of the Act and when assessing whether the conduct of the three unions breaches the Act, again we say and the evidence was very strong on the point, including the union evidence, that the three unions operated as a single bargaining unit and maintained a joint position throughout the negotiations. If the Commission pleases.

PN1887

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Neilson, do you want a short break?

PN1888

MR NEILSON: Perhaps if that's convenient, your Honour.

PN1889

THE SENIOR DEPUTY PRESIDENT: How long would you like?

PN1890

MR NEILSON: About 10 minutes if that's convenient.

PN1891

THE SENIOR DEPUTY PRESIDENT: All right. We'll adjourn for 10 minutes.

<SHORT ADJOURNMENT [3.45PM]
<RESUMED [3.58PM]

PN1892

MR NEILSON: Thank you, your Honour. ..... state categorically that despite what Mr Smith has put here today we don't agree in any way whatsoever that the Commission should indeed be satisfied that the unions have been engaging in conduct that has been alleged. The first point that we make with respect to pattern bargaining of course, your Honour, was made comprehensively in our submissions earlier that there is in fact no evidence of the union pursuing common claims at two or more workplaces and despite what Mr Smith has sought to assert from the bar table in his closing submissions about his personal knowledge, that in our respectful submission is not enough for the Commission to indeed be satisfied that the unions have been engaging in the conduct such as to warrant the Commission refusing the unions' application.

PN1893

Your Honour, I will preface my closing comments in reply on the basis that it is important to remember that the protected action ballot provisions were designed by the legislature, or so they say, to be facilitative of employees taking industrial action when negotiations had reached such a state that they deemed that that particular course of conduct was satisfactory and the points that my friend has sought to go to in his closing submissions despite criticising the union for being overly technical are just that themselves, overly technical and should not be rewarded by this Commission.

PN1894

Your Honour, my friend at paragraph 8 in one of his submissions in relation to whether or not the union had been engaging in pattern bargaining referred to in his closing submission the fact that the union had tendered a decision of Marshall J in the G & K O'Connor case and I think my friend was attempting to criticise the union for tendering such a case that was in, from my memory, 1999 when the new legislation had come into play. My friend sought to speak of his own experiences in writing the legislation, or as he tried to put it, that he wrote the legislation and the Commission should accept that as being the intent of the legislation.

PN1895

We submit that the decision of Marshall J was not in fact tendered for the purposes of demonstrating whether the union had been engaged in pattern bargaining. The decision of Marshall J went to the question of whether or not the unions were genuinely bargaining and that decision remains relevant up until this day for these reasons, your Honour, is that the words must be genuinely trying to reach an agreement have not changed under the new legislation. So much so was recognised by her Honour Senior Deputy President Acton who in fact cited the
G & K O'Connor decision in our respectful submission with approval in the Cadbury Schweppes decision. I don't have that exact reference, your Honour, you will see that.

PN1896

THE SENIOR DEPUTY PRESIDENT: No, I'm aware of it.

PN1897

MR NEILSON: Your Honour, my friend in his submissions sought to suggest that it is common practice and well known for the unions to develop claims on a standard basis and he sought to assert to the Commission that the Commission should in fact accept that assertion as evidence. In our respectful submission there is no evidence before the Commission that in fact the unions had in fact developed their claims on a common basis on an industry wide or even on a two or three shot wide basis and that fundamental defect in my friend's attack upon the union's application cannot be overcome by any assertions that have been made by the bar table.

PN1898

My friend seeks to draw the Commission's attention to some comments whereby he said that Mr Reid had acknowledged that the unions' claim had been developed at a mass meeting or a delegates meeting and my friend refers to paragraphs 65 to 71 that's dealt with at paragraph 22 of the written submissions filed by the AIG. Upon an analysis of in fact paragraph 65 to 71 Mr Reid admits no such thing.
Mr Reid says that in paragraph 65 at the end:

PN1899

At least once a year they get delegates together.

PN1900

So he admits that there is a delegates meeting and there's nothing unusual or improper about that, your Honour, and that's usually to decide on things what's going to be put up to state or national conference if there is and it's presumably cut off if there is one. And there's no acknowledge there by Mr Reid that in fact the delegates meeting that had been alluded to by Mr Smith had in fact occurred for the purposes of developing common or pattern claims and unfortunately in our respectful submission that has been the conduct of these particular proceedings, is that Mr Smith believes that something has occurred but he has no evidence to justify his actual belief. And as Mr Smith would be aware, the legislation has moved on and the legislation now says that individual claims must be developed on a workplace by workplace basis.

PN1901

There is no evidence before the Commission, your Honour, that the union or indeed the other unions have done anything other than comply with the legislation and certainly, your Honour, we submit that given that, there is no pattern bargaining taking place. The other point that I'd draw your Honour's attention to is that in Mr Smith's submission he asserts that there is nothing wrong with pattern bargaining per se. Pattern bargaining becomes illegal when one wants to pursue a protected action ballot. That submission is particularly interesting, your Honour, when one looks at the meaning of pattern bargaining at section 421 of the Act and in that particular reference, your Honour, you will see at 421(1)(b) and (1)(c) there is a requirement for there to be a course of conduct.

PN1902

Now, your Honour, leaving aside the fact that there is no evidence that the unions have in fact engaged in a course of conduct in pursuit of common wages or conditions of employment for two or more proposed collective agreements, the wording of the particular provisions that there be a course of conduct is interesting, your Honour, because if as Mr Smith asserts that pattern bargaining is not illegal up until the time of protected industrial action being taken or being sought to be taken we would say that the words course of conduct in fact require that there be an application for protected action ballot order across two or more workplaces and again, your Honour, there is in fact no evidence before the Commission that the unions have been engaged in that course of conduct and as such the Commission cannot be satisfied that there is in fact pattern bargaining.

PN1903

Your Honour, we believe in our closing submissions we comprehensively dealt with the requirements at sections 421(4) with respect to whether or not the parties have been genuinely trying to reach agreement. Your Honour, there was some criticism made of the fact that the unions had in fact been claiming to freeze the parent award and whether or not that was in fact pursuing pattern bargaining claims. Your Honour should take this on notice and I don't think my friend would criticise the comments, that in any agreement in which the award is appended or incorporated or referred to certain provisions of the award will in fact not be relevant. Your Honour will note from the transcript and I apologise for not having the exact reference, that in a question by myself to Mr Reid in reply
Mr Reid stated that the award was in fact incorporated or appended to the current Visy Villawood Enterprise Agreement.

PN1904

In that agreement, your Honour, it's common knowledge that there are in fact things dealt with like wages, there are particular allowances, there are particular things in relation to shift penalties and the like. So those particular conditions, your Honour, don't come into play when one is seeking to incorporate or to maintain award conditions because they're dealt with in the agreement. Now, if we were to focus on, for instance, X workplace out in the ether, your Honour, that my friend has sought to say that the unions are pattern bargaining with respect to, there is no evidence before the Commission that in fact where the unions are pursuing the award issue that there is in fact the issue of wages not dealt with in the agreement or allowances not deal with in the agreement and so the award being a large document, your Honour, the Commission needs to be satisfied that the unions are in fact pursuing at one workplace wages, allowances and various other award conditions and at the same workplace pursuing those same matters and again, your Honour, there is no evidence before the Commission of that being the case.

PN1905

We maintain our submission and we don't regard it as being creative in any way that the Commission must indeed be satisfied that the unions are in fact pursuing a claim for the same award. There is no evidence before the Commission that the other workplaces that my friends refer to in cross-examination of Mr Reid and
Ms Seagrove are in fact dealing with either the Metals Award or in fact the Rubber Plastics and Cable Makers Award. Your Honour, the other criticism that we make of my friend's case is that he makes a lot of assertions that certain things are standard practice and, your Honour, certainly times have changed, as we've said, and there is no evidence before the Commission that the unions have in fact been engaging in their standard practice and we would say to Mr Smith that times have moved on and the unions have realised that long ago.

PN1906

The other point, your Honour, that we would seek to make is that my friend referred to the decision of the Commission in the Rheem decision. We don't necessarily resile away from our submissions as to the effect of Browne v Dunn. Your Honour ruled on that question when we sought to exclude the evidence of Mr Ryan as a result of that rule and we say nothing turns upon Mr Smith's submissions on that particular point today. The only point that we do say remains relevant on that question, your Honour, is the fact that these matters were not put to Ms Issanchon. You will see from their Honours discussion in that particular decision a lot is made of the fact of whether or not certain things have been put in witness statements that have been filed and whether or not particular witnesses are in fact on notice that these things are going to put be put in issue in the proceedings.

PN1907

We would say, your Honour, that whilst it may be accepted that the issues were put on clear notice with respect to Ms Seagrove, we would submit that there is nothing to say that the issues were put on clear notice with respect to Issanchon and as a result of that, your Honour, the Browne v Dunn rule, even applying the comments of the Full Bench in the Rheem decision, would continue to apply and the evidence of Ms Issanchon on that point must be preferred and consequently the evidence of Ms Seagrove. That comes to the central issue for determination in this case, your Honour, is in fact the credibility of the witnesses that have been brought by the unions and been brought by Mr Kroon and Mr Ryan and we've made a lot of that in our closing submissions.

PN1908

Your Honour, we say that Mr Ryan and Kroon's evidence is on the basic analysis completely inconsistent with not only themselves but with other witnesses and we maintain that the unions' witnesses have been wholly consistent in their evidence in these proceedings. The employer's witnesses have been wholly inconsistent in their evidence in these proceedings and as a matter of fairness we would submit that the Commission should prefer the evidence of the unions over that of the employer.

PN1909

The other point that my friend took you to, your Honour, is to suggest that the Commission must be satisfied that the prerequisites in 451 and the related provisions have been complied with and we don't resile from that submission. But what we would say, your Honour, is that the Commission must be satisfied on the balance of probabilities. My friend, although not putting it directly, sought to assert perhaps that the Commission must be totally satisfied that he's referred to have in fact not gone on and we would submit that the Commission, as is the ordinary case, can be satisfied on the balance of probabilities.

PN1910

The last point that I'll take you to, your Honour, and we say that a lot of the matters have been dealt with in our reply, in our closing submissions rely and we continue to rely upon them, is the effect of the decision of the LHMU v Wattyl Pty Ltd. In our closing submissions earlier, your Honour, we made reference to that decision and only doing so in passing by asserting that in our view that decision did not have impact on these proceedings. We maintain that particular view, your Honour, on the basis of not only her Honour's comments, her Honour Senior Deputy President Acton's comments in the Cadbury Schweppes decision, but also upon an analysis of the decision in Wattyl itself.

PN1911

Wattyl was concerned with the old section 127 application whereby it was asserted that action that had been taken was in fact not protected and we say that that question is potentially a matter to be dealt with after the ballot has been approved or rejected by the employees, it is not a matter for the Commission to concern itself with now and so much so was accepted by her Honour Senior Deputy President Acton in Cadbury Schweppes at paragraph 40 where prior to dealing with the LHMU decision her Honour finds that there is nothing in her view wrong with having a deed on the table and the mere fact of having a deed on the table did not in any way cancel out the union's applications and then she dealt with the issue as to whether or not they genuinely reach agreement.

PN1912

THE SENIOR DEPUTY PRESIDENT: But she did say the deed might have to be withdrawn before the required written notice of intention - - -

PN1913

MR NEILSON: That's right, your Honour, yes.

PN1914

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1915

MR NEILSON: We acknowledge that and that certainly is the next step, we would say.

PN1916

THE SENIOR DEPUTY PRESIDENT: Yes, yes.

PN1917

MR NEILSON: But we don't say it has relevance for the purpose of these proceedings, as was asserted to by Mr Smith. Your Honour, there are a number of matters in Mr Smith's closing submissions whereby he seeks to adduce more evidence from the bar table and also speaks of personal offence in relation to certain matters. We don't make a great deal of that but we say that the Commission is not assisted by those submissions and should not then take them into any detail. In relation to the criticisms that have been made of the unions referring to particular people as liars, well, we would say that of course the Commission in dealing with the evidentiary conflict is of course, maybe not to call someone a liar, but certainly required to determine whether or not someone's evidence should be favoured over that of another witness and that is an ordinary course, your Honour, and of course the unions are advocating for their own witnesses to be believed over that of the employer and we say that there's nothing wrong in doing so.

PN1918

Your Honour, we maintain that the unions have been genuinely bargaining. We have not engaged in pattern bargaining. The statutory prerequisites of the Act have been met. Can I just deal with final point, your Honour, and that is the submission that my friend went to about the bonus system and whether in fact the unions had genuinely considered that offer prior to taking these proceedings to the Commission.

PN1919

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1920

MR NEILSON: It's the evidence of Mr Reid and it was comprehensively put both in cross-examination and in his witness statement that Mr Reid was aware of the bonus offer in May 2006. My friend sought to go to this issue in some detail in cross-examination to criticise Mr Reid about whether or not he had in fact taken into account the company's full offer and Mr Reid was able to effectively spell out what it is that the company had in fact offered and the reasons why in fact it was unacceptable to the employees. It was put to Mr Reid in cross-examination in fact that the union had adopted a position whereby it would holus bolus reject offers of bonus systems and Mr Reid dealt with that comprehensively by saying that if there was a decent base increase then his members had indicated to him that a bonus system would not necessarily be rejected by them.

PN1921

We say that that issue has been taken into account by the members. There can be made no criticism made of Ms Seagrove not taking the issue into account as was alluded to by my friend on the basis that Ms Seagrove had recently returned from maternity leave and Ms Seagrove had had a hand over with Mr Reid in relation to the proposed issues and we say that that issue had been dealt with by Mr Reid in any event in May 2006. Can I just deal with that one issue, your Honour, and that is that what my friend's submission if accepted by this Commission would effectively do is defeat any application for protected action being taken by unions and/or employees and that is because if the submission was to be accepted employers could simply put on the table just prior to a ballot application being taken any small matter of which the unions would of course have to delay their protected action ballot order application to consider to go through the proposals and then go back to the employer to reject and then come back to the Commission to make their application, at which time the employer could put something new on the table which would of course delay the process all over again.

PN1922

We say that that is important submission to reject, your Honour, because the Act imposes an obligation to continue to negotiation or to continue to attempt to negotiate even if a ballot order has in fact been ordered and we say that that obligation has been satisfied by Ms Seagrove. The issues of bonus or whether the company wishes to put something new on the table in the future will be taken into account by the parties but it is not a reason to refuse the unions' application for a protected action ballot to be ordered. If that pleases your Honour.

PN1923

THE SENIOR DEPUTY PRESIDENT: Thank you. Yes, Mr Clements.

PN1924

MR CLEMENTS: Just very briefly, your Honour. Essentially in our submission this application falls squarely on two points. The first point, and this is inasmuch as Mr Smith's arguments rise and fall on two points, the first point is that, as I understand it, the seeking of the freezing of awards by the union - of the awards by the unions in this case is a case in point of pattern bargaining, and secondly, whether on the facts of this case as Mr Smith alleges that the deed or MOU, agreement to the deed or MOU - sorry, agreement to the EBA was contingent on agreement to the deed or MOU.

PN1925

In relation to the first point in relation to the freezing of awards I drew your Honour's attention to section 355(4)(a) and (b) of the Act in my closing submissions and I wish to touch on that point again and the point is that the unions have two choices, an award can be called up into an agreement as varied from time to time or as in operation just before the agreement was made. Now,
Mr Smith in his closing submissions made the statement that it only has to be found that in two workplaces, that a common claim is made in two workplaces and that's pattern bargaining.

PN1926

Now, effectively because the unions have two choices, as varied from time to time or as in operation just before the agreement, that gives us four workplaces in Australia, your Honour, whereby if we make an application to put the award in as varied from time to time in more than one workplace the third time we go to put it in we'll put up for pattern bargaining, if we take Mr Smith's argument to its logical extension, your Honour, as in this case - - -

PN1927

THE SENIOR DEPUTY PRESIDENT: I think it's said in the context of seeking to take industrial action.

PN1928

MR CLEMENTS: Yes, that's correct, your Honour, so if I can replace what I said by saying if the unions seek to take industrial action over putting the award in as varied from time to time as in operation just before the agreement in more than two workplaces or more than one workplace, well, is that pattern bargaining, your Honour, and therefore we do ever have a chance to put an award in more than twice around Australia, I mean that's the logical extension of the argument. Now, Mr Neilson correctly pointed out that when you call an award up into an enterprise agreement it is called up in the context of where the agreement is silent the award operates.

PN1929

Now, therefore the substantive part of pattern bargaining Mr Smith would have to prove that the award is called up and the effect of the calling up of that award as in operation just before the agreement is made has exactly the same effect at more than one workplace. Now, that depends on the agreement in the other workplace. I mean an agreement in workplace A, for instance, could have different sections to the award on overtime or shift loadings than agreement B which may rely back on the overtime or shift loadings in the award. Now, the effect of the award when called up is only as if the agreement is silent, therefore the award as called up does not have the same effect on the terms and conditions in those workplaces just because it's called up, your Honour, and I think it's a very dangerous argument to be made, that simply attempting to call the award up as in operation just before the agreement is made and seeking to industrial action is pattern bargaining.

PN1930

In relation to the second point, that being that the EBA is contingent on a deed or MOU being agreed, that Mr Smith relies entirely on the evidence of Mr Kroon and Mr Ryan and in particular point 19 of Mr Kroon's statement and point 23 of Mr Ryan's statement. Now, obviously as your Honour has seen, the witnesses for the applicant, for the unions, have steadfastly disputed that in fact those things were said and in this case your Honour is asked to make a judgment as to the credibility of the witnesses. Considering that the statements, if they are accepted, link this case directly to the Cadbury Schweppes decision. I think there should be some doubt already, your Honour, and the massive conflicts in the credibility of the two witnesses I think, your Honour, is a very important point and I think that defeats the argument on the evidence and there is no other evidence than those statements, your Honour. That concludes my submission.

PN1931

MR NEILSON: Your Honour, can I just make one brief comment, I apologise for this and it was just a point touched on by my friend and I've just noticed it. In paragraph 42 of Mr Smith's closing submission and it's on that point of whether the comment breaching agreement on the EBA is relying the parties also reaching agreement on the deed.

PN1932

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1933

MR NEILSON: We say that that's been comprehensively dealt with and I don't want to focus on that particular comment. But the second comment is could cause a problem for us and, your Honour, my friend seeks to have the Commission draw and inference that in fact the issues are related. We say that there is nothing to be read into those particular words. Your Honour, it's quite clear from
Ms Seagrove's evidence that if any claim is rejected by an employer whether be reinstatement of an employee dismissed or a claim for an allowance or anything like that, of course it's going to cause a problem. The inferences that my friend seeks to attach to those particular words we say are not fairly available.

PN1934

We say the fact that Ms Seagrove admits making those particular words goes to her credibility. It would be convenient given that the criticism that my friend seeks to make of her evidence on these particular points for Ms Seagrove simply were she not telling the truth to simply deny making the comments whatsoever. Ms Seagrove correctly, we say, tells the truth and says yes, I did make the comments but I didn't make them at the meeting that's been referred to, I made it on 6 July at a totally separate meeting relating to redundancies where the agreement was in fact not even mentioned. We say that the words could cause a problem for us, are not akin to the words attributed to Mr Mavromatis in the Cadbury Schweppes decision where he said effectively sign this and all your problems will go away.

PN1935

Those are not the same words and certainly we would submit that they in fact demonstrate Ms Seagrove's credibility with respect to the proceedings. My apologies, your Honour.

PN1936

THE SENIOR DEPUTY PRESIDENT: Thank you. Ms Parkes.

PN1937

MS PARKES: Thank you, your Honour. Your Honour, as you've already heard from the AMWU and the AWU, the key issues in Mr Smith's submissions for the respondent concern pattern bargaining and the linkage, or the alleged linkage of the agreement to the deed and the MOU. Now, in respect to pattern bargaining I only wish to add a few short points to the comments that my friends have comprehensively addressed you on in their earlier submissions. A point was raised that Mr Smith alleged that the pursuit of the maintenance of award conditions was only pattern bargaining if it involved industrial action and we would note there's no evidence of industrial action either happening or likely to be happening at any other workplace where Mr Smith is alleging that such claims are being pursued.

PN1938

We would also note, your Honour, that at paragraph 26 of Mr Smith's submissions, it's actually on page 8, the second bullet point, there's a reference there to the union officials admitted that they were pursuing a common claim for the freezing of award conditions across more than one workplace and in respect with the NUW, Ms Issanchon, the reference numbers of the transcript are paragraphs 642 and 643. Now, your Honour, when one actually looks at paragraphs 642 and 643 of the transcript they actually refer to the Visy negotiations only and the reference there was Ms Issanchon states that:

PN1939

The only outstanding claims that the union has been pursuing would be to have a wage increase and to have the award attached to the back of the EBA and frozen at the time of the signing of the award of the EBA, to have the Metal Workers Award and also the Rubber Workers Award attached as an appendix at the back.

PN1940

Then at paragraph 643 there was a reference to there whether the claims included the deed and Ms Issanchon states:

PN1941

The wage increase of the EBA, not really, because we haven't been discussing the deed is to be signed off anywhere, the signing of the EBA, the EBA ...(reads)... that has been the discussion.

PN1942

Now, your Honour, Mr Smith did ask Ms Issanchon about other workplaces at paragraph 625 but that only concerned whether the NUW may or may not have raised the issue of a deed. So there is no evidence before you that the NUW has sought to freeze award conditions, as Mr Smith puts it, across more than one workplace and the paragraphs that he attributes in evidence of Issanchon simply do not support that proposition. Mr Smith also makes much of the fact that there are similarities between the Metals Award and the Rubber, Plastic and Cable Makers Award, although Mr Smith himself does acknowledge that there are differences, for example, shift loading and further, there would be further differences in the sense that at the Visy workplace there are particular conditions contained in the existing agreement that the parties will apply rather than the respective award conditions.

PN1943

My learned friends have addressed you on the issue of where the agreement is silent and that it's not the award in its entirety subject to prohibited conditions. It's only particular award conditions depending on the circumstances of the Visy agreement that are sought to have application and so once again we would submit that it's not been established that those particular conditions are being sought at more than one particular workplace. If I could just, your Honour, touch on the bonus system. Much has been made by Mr Smith of the bonus system. It should be noted that in exhibit NUW1 Ms Issanchon gave evidence, that is her statement, your Honour, that the NUW members are particularly concerned about the KPI bonus scheme.

PN1944

It should further be noted, your Honour, that in cross-examination this particular issue was not brought up and indeed the issue of bonus was not discussed with
Ms Issanchon. So we say that the AIGs argument on behalf of the respondent that for some reason that members hadn't seriously considered the bonus system is simply not made out on the evidence. Finally, Mr Smith makes much point of the decisions in Jones v Dunkel and in particular says, well, which witnesses was I supposed to call, I called the obvious witnesses, namely the two employer witnesses and the union witnesses were called by the union, just to paraphrase
Mr Smith.

PN1945

Well, with respect, we would submit that the obvious witness that Mr Smith could call was one of these alleged employers out in the ether where this alleged pattern bargaining is supposedly taking place. As your Honour would be aware, the AIG is a very large organisation representing thousands of employers and the fact that Mr Smith has not been able to bring not even one such employer to provide evidence as to the existence of a common course of conduct outside of Visy we say is indeed telling. Your Honour, if I could take you towards the issue that ..... if I could term it as such.

PN1946

THE SENIOR DEPUTY PRESIDENT: Yes.

PN1947

MS PARKES: Mr Smith made submissions that he was personally offended by the NUW submissions and I should say for the record that the NUW certainly did not intend to personally offend Mr Smith. The point that the NUW is making and this is the point that we've been making all along, your Honour, that regrettably this case turns upon varying versions of events. It's not a case where it's matter of legal principles in issue to the large - the case turns on the various versions of events in respect to the Cadbury Schweppes issue of what the witnesses allege happened. We have a range of parties in an industrial relationship whereby certain witnesses are saying one thing and certain witnesses are saying another and it's not just relative minor inconsistencies as alleged by Mr Smith, there some major inconsistencies.

PN1948

It is the Commission's job to determine effectively who is more credible, whose version of events or whose truth of events it to be preferred and to that extent there is always going to be one or two or more witnesses that the Commission finds more credible in a legal sense than other witnesses and it will be the case in this particular case. And indeed that is regrettable from an industrial position but unfortunately that is the position that we are in. We are defending our application and we say that the union witnesses for the reasons outlined both in the NUW submissions and the submissions made by my learned friends from the AWMWU and the AWU that the credibility of the union witnesses is indeed to be preferred over the credibility of the employer witnesses.

PN1949

To that extent the Commission should consider the NUWs submissions in that light. If the Commission pleases.

PN1950

THE SENIOR DEPUTY PRESIDENT: Thank you, Ms Parkes. Nothing further? No, very well. I will reserve my decision and it will be handed down as soon as practicable. Thank you for the submissions. The Commission stands adjourned.

<ADJOURNED INDEFINITELY [4.32PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #AIG5 FOLDER OF MATERIALS, DATED 27/07/2006 PN1708