C2007/2588, Transcript of Proceedings [2007] AIRCTrans 249 (21 May 2007)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996 16860-1

COMMISSIONER WHELAN

C2007/2588

s.170LW -prereform Act - Appl’n for settlement of dispute (certified agreement)
National Union of Workers
and
Smorgon Steel Metals Distribution
(C2007/2588)

MELBOURNE

Reserved for Decision

10.20AM, TUESDAY, 08 MAY 2007

PN1

THE COMMISSIONER: I think this is the first time we’ve been on the record, isn’t it? So perhaps I should take the appearances.

PN2

MR P RICHARDSON: I appear for the National Union of Workers with
MR A RILEY.

PN3

MR A DALTON: I appear for the Australian Industry Group representing the company in this matter and with me today is MS J WHITEHEAD and MR L BAKER.

PN4

THE COMMISSIONER: Thanks Mr Dalton. Now I’ve received the written submissions that have been lodged by both the union and the company. I also note there has been some issues raised as to whether there was a necessity for evidence to be called in relation to certain aspects of the respondent’s submission. Have you two had the opportunity to discuss that?

PN5

MR DALTON: Yes, Commissioner we have. In terms of that the company has provided further information in regard to point 13 and point 35, naming the people who are involved and I believe that satisfies Mr Richardson on that basis. With regard to point 29, Mr Richardson believes that the second sentence is an assertion and advised that he required witness evidence on that matter. In regard to point 46 that the first sentence there was an assertion and required witness evidence. Point 44, sorry, again the first sentence requiring witness evidence and point 65 the first sentence there.

PN6

Now in terms of that the company is – Ms Whitehead has some direct involvement in all those matters and is prepared to give witness evidence if the Commission believes that’s appropriate. However, I would like to make a point in regard to point 65. Unfortunately, the person who was involved in the appointment of those people, Mr Adam Nottes who was the previous state operations manager, is no longer with the business, and is no longer with the company. So we do not actually have any person who was directly involved in the appointment of those people. We do have the human resources administration officer with us but she can only give evidence that she was advised that they were appointed not actually the decision on why they were appointed.

PN7

THE COMMISSIONER: Yes.

PN8

MR DALTON: Mr Baker came on to the scene later and wasn’t involved in the direct appointment and Ms Whitehead wasn’t involved in the direct appointment. The company instructed me that in terms of that statement being included in our outline of submissions on the basis that they concluded that that was the basis for those appointments being made. But given the issue that we cannot provide direct evidence to the raison d’etre for those appointments, I acknowledged and I’ve had discussions with Mr Richardson that you may have to consider the evidence in the light of that inability of witness evidence to be adduced on that particular matter.

PN9

In terms of the other points if the Commission believes it’s appropriate Ms Whitehead is available to give evidence on those particular matters. It was my proposal that Ms Whitehead only deal with those particular matters as being
raised. It wasn’t a situation where we would go to providing evidence beyond those particular matters. If Mr Richardson has other issues if they could be identified and we could deal with that whether or not witness evidence would need to be provided on that.

PN10

THE COMMISSIONER: Sure.

PN11

MR DALTON: In terms of the material that we did provide to you Commissioner, attachment 4 had a second page to it that was presented to you in error. That document is not relevant to our submissions and therefore was presented to you in error and in terms of that we seek that that be withdrawn from the submissions. If the Commission pleases.

PN12

THE COMMISSIONER: Okay. Can I just ask you Mr Dalton, you referred to paragraph 65 of your submission, was Mr Richardson seeking evidence in relation to both those sentences, or just the first one?

PN13

MR DALTON: It’s my recollection when I marked the matter, it was my recollection it was the first sentence, but he would have to confirm that.

PN14

THE COMMISSIONER: Okay, I’m just - presumably you would be in a position to give evidence in relation to the duties performed?

PN15

MR DALTON: I would have to get instructions on that Commissioner in terms of that, I haven’t dealt with that particular matter because as I say I didn’t mark that - - -

PN16

THE COMMISSIONER: You understood the first issue, the first sentence that was the issue.

PN17

MR DALTON: The identified one and that was – I did and that was the one with the company.

PN18

THE COMMISSIONER: All right then, thank you. Mr Richardson can you confirm with me – I understand that I – I haven’t actually got a copy of the letter that you sent to Mr Dalton but I understand that you did raise a number of issues. Some of which related to the identification of who was involved in particular discussions and that information has been provided. The second was in relation to a number of statements made in the submissions and they’ve been identified as paragraphs 29, 44, 46 and 65. Mr Dalton has indicated that he is in a position to call evidence in relation to 24, 44 and 46. In relation to 65 what aspect of that were you seeking evidence in relation to?

PN19

MR RICHARDSON: Thank you for that Commissioner. Commissioner firstly if I could correct – well no I withdraw that – firstly if I could confirm that as a – there was no correspondence from the union, I spoke to Mr Dalton yesterday afternoon and I raised with him concerns as to six paragraphs. Two of those have been dealt with namely, paragraphs 13 and 35 where the union simply sought advice as to who the delegates were.

PN20

THE COMMISSIONER: Who the people were, yes.

PN21

MR RICHARDSON: I confirmed that the union has received that advice and that is satisfactory to us. It may be appropriate at some point that that be placed on the record.

PN22

THE COMMISSIONER: Yes.

PN23

MR RICHARDSON: I then also raised concerns as to the four paragraphs and I think Mr Dalton’s recollection is slightly incorrect. In respect of paragraph 29 it was the entire paragraph in fact we would say that the first and second sentence need to be read effectively as one. In respect of 44, it is effectively only the first sentence, in that sense Mr Dalton is correct.

PN24

THE COMMISSIONER: Because the second is a statement of fact which you don’t dispute?

PN25

MR RICHARDSON: We don’t dispute that there were employees to wage maintenance that is correct.

PN26

THE COMMISSIONER: Yes.

PN27

MR RICHARDSON: At 46, it’s effectively the first two sentences. If I put that another way, the union doesn’t dispute that in the last quarter of the last year there was a new warehouse management system introduced. In respect of 65 and in due course we would seek to be heard on that, it is in fact the totality of the paragraph.

PN28

THE COMMISSIONER: Right okay.

PN29

MR RICHARDSON: Now the question asked of Mr Dalton was, in the union’s view those last four paragraphs were assertions, or at least part of those four paragraphs were assertions and that it would be appropriate that there be evidence to support those. The union confirms that it is prepared to restrict its examination or cross-examination to those four paragraphs.

PN30

THE COMMISSIONER: Okay, all right.

PN31

MR RICHARDSON: If I could also just while I’m on my feet, thank Mr Dalton for clarifying the status of the second page of attachment 4. If the Commission pleases – his attachment 4 I beg your pardon.

PN32

THE COMMISSIONER: Attachment 4 to his submission, yes. Okay then, thank you, does that clarify the situation for you Mr Dalton?

PN33

MR DALTON: Yes, thank you.

PN34

THE COMMISSIONER: All right it does. Well I think that as I understand Mr Richardson you are not intending to call any evidence.

PN35

MR RICHARDSON: No.

PN36

THE COMMISSIONER: To rely on the submissions, I think therefore it’s probably most appropriate and I think that given some of the statements challenged, that there is evidence called in relation to those statements only made in the submission of the respondent. So I think by way of procedure I would hear that evidence first, then I’ll hear any further submissions you want to make Mr Richardson and then I’ll hear any further submissions you want to make Mr Dalton. Okay if you want a couple of minutes before you call the evidence, do you want to do that?

PN37

MR DALTON: No, that’s okay Commissioner, I had an opportunity to have a talk to my clients this morning.

PN38

THE COMMISSIONER: All right then we will proceed on the basis then Mr Dalton that you call evidence which will be restricted in terms of both evidence in chief and cross-examination to the matters that are dealt with in paragraphs 29, 44, 46 and 65 of the respondent’s outline.

PN39

MR DALTON: Thank you Commissioner and in terms – I’ve just been confirmed that Mr Baker is able to deal with the second part of paragraph 65.

PN40

THE COMMISSIONER: 65 okay.

PN41

MR DALTON: Are you happy for Mr Baker to stay in the court while Ms Whitehead gives her evidence on those matters.

PN42

THE COMMISSIONER: I don’t think there should be any difficulty with that Mr Dalton.

PN43

MR DALTON: Thank you, I call Ms Whitehead first.

<JOANNE ELIZABETH WHITEHEAD, SWORN [10.31AM]
<EXAMINATION-IN-CHIEF BY MR DALTON

PN44

THE COMMISSIONER: Thanks you can be seated Ms Whitehead.

PN45

MR DALTON: Could you just repeat your name and address for the
record?---Joanne Elizabeth Whitehead (address supplied).

PN46

What is your position with Smorgon Steel?---Employee relations manager.

PN47

How long have you worked with Smorgon Steel?---For five and a half years.

PN48

Have you had any involvement in the settlement of a dispute involving classification restructure at the Westall Smorgon Steel operations?---Yes I did have considerable involvement with both the matters that commenced around February 2006 and were concluded in September 2006.

PN49

Was a part of that settlement a proposal by the company to deal with the wage maintenance of the employees who were previously grouped or classified as junior foremen?---Yes, there was an arrangement. We had considerable discussions and meetings and the final settlement reached in September was salary maintenance for the – until the period of 1 July 2007. This was significantly different from our original position. Originally we had hoped to implement the new restructure in the first half of 2006, however, for various reasons that was delayed. Our original proposal which was discussed with the union delegates was a salary maintenance to July 2006. So we actually extended our wage maintenance for a further 12 months because of the time taken, the initial date went past and in September the settlement was that we would continue until the end of the financial year.

PN50

So the re-classification was originally raised with the union and delegates
when?---The original discussion or initial discussions commenced in February 2006 with local management and local delegates and they had a number of meetings in February 2006 which talked through a number of the issues in relation to the reorganization and one of those was the wage maintenance to – sorry 1 July 2006 and I think there has been in the evidence attachment 6 which was a presentation which does identify that date as the original offer for the wage maintenance.

PN51

Now in terms of the development of the settlement offer that was put by the company, what factors did the company take into account?---There were a number of factors in determining what the settlement ended up being and the resolution of both issues. The union were strong from the outset, going back to April 2006 that the two matters should be dealt with as one and they were wanting to resolve both matters jointly. Initially that was not our preference to do so, but certainly that ended up being the case. There were numerous discussions on both issues throughout April and May and we were in the Commission for the mixed functions claim. We then had the dispute notified formally for this matter in July and discussions commenced in July through July and August in trying to reach a settlement. It was the company’s view that any settlement would be a full and final settlement and would resolve the issue of junior foreman once and for all and that there would be no junior foreman going forward after the settlement was reached, which was why we determined to offer a significant period of wage maintenance which is – you know how that came about.

**** JOANNE ELIZABETH WHITEHEAD XN MR DALTON
PN52

Were you aware of – sorry I’ll rephrase that – did you believe that the settlement for the dispute would finalise the matter completely?---Definitely, I mean the company would not have made such a generous settlement if it wasn’t resolving both issues and certainly the advice that we received was that it did in fact resolve both issues.

PN53

What advice was that?---There was a letter from Charles Donnelly which was sent to the Commission which outlined that the settlement was put to members and it was agreed, the settlement was agreed and it was in resolution of both the disputes.

PN54

MR RICHARDSON: Commissioner, I’m sorry, firstly Mr Dalton does appear to be taking Ms Whitehead into areas other than those we agreed upon. Secondly I rise because even though there is an acknowledgement of correspondence to the Commission that appears as an attachment, it is not as Ms Whitehead has just characterised it. If the Commission pleases.

PN55

MR DALTON: I do apologise Commissioner if I am straying - - -

PN56

THE COMMISSIONER: I thought that Mr Dalton was going to the issue of the company’s view that this settled everything which seems to be what is being referred to in paragraph 44.

PN57

MR DALTON: I’m trying not to put words in people’s mouth Commissioner.

PN58

THE COMMISSIONER: Yes, I know you are trying not to lead basically and it’s not all that easy given the nature of the paragraphs that he’s being asked to provide evidence in relation to.

PN59

MR DALTON: In regard to the restructure of the supervisory reclassification what was the original timetable?---Well originally the view was that it would be implemented prior to June 2006, but as I mentioned through circumstances and disputes et cetera, that was obviously delayed. In the settlement document we talked about implementation being October 2006. However, that didn’t occur.

PN60

Why didn’t that occur at that time?---The site operations manager vacated his position and was successful to moving to another role within the Smorgon organization and the recruitment process took much longer than anticipated. In fact, it wasn’t until December 2006 that we had a replacement for the site operations manager and given Christmas New Year period a decision was made not to implement until 2007 and additionally we were implementing a new warehouse system, going from a manual system to one that uses scanners and VDUs so the decision by local management was to delay it until February March 2007.

**** JOANNE ELIZABETH WHITEHEAD XN MR DALTON
PN61

I believe that covers off those matters Commissioner, as I say I’m aware I don’t want to be straying into other areas, so I’ll leave it there if the Commission pleases.

PN62

THE COMMISSIONER: Yes, Mr Richardson?

<CROSS-EXAMINATION BY MR RICHARDSON [10.42AM]

PN63

MR RICHARDSON: Ms Whitehead I would like to show you a document and ask if you can identify it?---Yes, it’s the outline of the respondent’s submission.

PN64

Thank you I’m not sure Commissioner whether that it needs to be marked as an exhibit, I just wish to take Ms Whitehead to those paragraphs that I’ve referred to.

PN65

THE COMMISSIONER: Actually I think that the – I’ll probably mark both of the submission documents in these proceedings.

EXHIBIT #R1 SUBMISSIONS OF RESPONDENT

PN66

MR RICHARDSON: Ms Whitehead can I ask you to page 6 paragraph 29 of the document?---Yes.

PN67

There it says, “in reaching this settlement the company had made some significant concessions”. Now you’ve given evidence that the company extended for a period for a further 12 months the wage maintenance to the employees classed as junior forepersons, were there any other concessions made in respect of the junior forepersons?---Yes there were. There was a commitment given to ongoing training and training that had yet to occur. That was an issue brought up by the local delegates that junior foremen had not all received the training that had been promised, so a commitment was given that any junior foremen that wanted to participate in training in the future would be free to do so.

PN68

Was that training provided?---No, the training has not been provided as yet.

PN69

Thank you, just so we’re clear, the training that would be provided to the junior forepersons was not provided and has not been provided, is that correct?---The intention is that any junior foremen that want to participate in training will be offered training and will be able to do so.

PN70

If that’s the intention, how has that been communicated to the employees classed as junior foremen? I’ll rephrase the question – has that been communicated to the junior foremen?---It is my understanding that it has. Individual discussions were held with junior foremen by the site operations manager and they were advised that training – they were able to participate in training if they wished to do so, but on the other hand if they did not to do so there would be no pressure to undertake that training.

**** JOANNE ELIZABETH WHITEHEAD XXN MR RICHARDSON
PN71

But as we speak at this point in time that training hasn’t been provided, that is correct?---I don’t believe that the training has occurred at this stage, but the intention is that it will and it certainly will be offered.

PN72

Well Ms Whitehead can I take you to, and Commissioner, I ask for this latitude, the second attachment in the document you have, which is the document titled, Westall operations proposed organization structure, if I could refer to it as the power point presentation and in particular the last page of that document, titled impact of needs structure, do you have that?---I do.

PN73

Under the title agreement, there are the words “all training needs required and not completed by current junior foremen will be completed on a voluntary basis”. Is that the same training that you are referring to?---I believe it is but obviously the whole implementation of this restructure has been delayed and therefore that’s one of the reasons, the training has been delayed but the intention is that junior foremen that want to participate in training will be able to do so.

PN74

Thank you now if I could go to that intention. Was it the intention that the training would be provided prior to the new foremen’s positions being advertised or subsequently?---I don’t think that was discussed when the training would occur. I think that it was, certainly when the delegates raised it they wanted to be sure that they would still be given the opportunity and not lose that opportunity because they were reverting to a lower classification.

PN75

So Ms Whitehead if one of the junior foremen had undertaken the training and had successfully completed it what in the company’s view would have happened to that employee on 1 July this year?---I don’t really understand what you are getting at. The training didn’t occur we’ve said that.

PN76

Well Ms Whitehead I’ll ask the question again.

PN77

THE COMMISSIONER: Well Mr Richardson I think you are going far beyond the paragraph.

PN78

MR RICHARDSON: If the Commission pleases.

PN79

Ms Whitehead if I could take you back to paragraph 29 again, in the second sentence there is a reference to no redundancies is that a concession that the company made?---That is certainly, and from the outset you will recall in discussions that we made it clear that there would be no redundancies the company did not want redundancies, the company wanted to retain all employees and there was never the intention to make people redundant.

**** JOANNE ELIZABETH WHITEHEAD XXN MR RICHARDSON
PN80

So I’m somewhat confused as to how that could be described as a concession Ms Whitehead?---Certainly job security I think is top of mind for most people and having a job going forward under the structure and having salary maintenance and providing training for those employees that wanted it were all concessions and outcomes that the company agreed to and as did the union.

PN81

If I can now take you to page 8 of paragraph 44 and in particular the first sentence. Now Ms Whitehead you were involved in several discussions that led to the September 2006 agreement?---Yes, I was.

PN82

Was there at any time to the best of your recollection discussion about clause 20.8.1 of the certified agreement?---Which is the junior foremen?

PN83

Yes, if the Commission likes I could come at the question another way. Ms Whitehead you are familiar with the certified agreement that applies to the Westall site?---Yes.

PN84

You are familiar with the clause that is central to this matter, clause 20.8.1 which describes a junior foremen?---Yes.

PN85

Was there any discussion raised in those discussions that are referred to paragraph 44 about clause 20.8.1?---I believe – I mean the whole position of junior foremen was central to the dispute and to the reorganization, so during discussions we talked about the removal of that classification under the new structure and t he outcome of junior foremen either going to a higher classification under the new structure or reverting to level 4 with wage maintenance.

PN86

All right again Ms Whitehead you are familiar with clause 20.4 of the certified agreement which deals with promotional criteria?---Not word for word, but I know the clause.

PN87

Do you recall any discussion about clause 20.4 during those discussions referred to within the outline of submissions?---I don’t believe that during the settlement of the dispute, 20.4 was specifically raised, although I can’t recall 100 per cent.

PN88

If we could then turn to page 9 of paragraph 46 please. I think you may have actually answered this under examination, but there it says the manager of the Westall operations was promoted, I’m just wondering is that the operations manager that’s being referred to or the state manager?---No, it’s the site operations manager at Westall.

**** JOANNE ELIZABETH WHITEHEAD XXN MR RICHARDSON
PN89

On or about what date was the site operations manager promoted?---It was some time in August and as I pointed out recruitment took some three or more months which was unusual, but we wanted to ensure that we got the right candidate and we were only successful in taking someone on board in December 2006.

PN90

Thank you and was at any time the union advised of the delay in implementing the 2006 agreement?---Certainly I believe that local union delegates were aware of the situation, however, I am not aware of formal notification going to the union office.

PN91

For the sake of clarity by union office, you mean union officials?---Union.

PN92

Finally Commissioner, I appreciate that this might be of limited value, if I could direct your attention to page 12 paragraph 65. Now Ms Whitehead is says:

PN93

In practice the category of junior foremen has been used to award some employees with a higher pay rate.

PN94

Do you understand that to be a matter of fact?---I wasn’t involved in the promotion of store person to junior foreman, it is a classification that is unique to Westall it doesn’t exist in any other site. So I’m not really familiar with why it even got there, but in discussions there has been mention of it was really given as a way of rewarding people to a higher level. But I wasn’t directly involved with the previous site manager who obviously promoted a number of people from stores category to junior foremen and it was when Mr Baker came on board in 2005 towards the end of 2005, saw the structure and realised it needed to change, and hence we ended up with our new structure.

PN95

Commissioner, I have no further questions of the witness but I do seek that at the conclusion of these proceedings, the union be afforded the opportunity to communicate to the Commission and the company, the names and titles of other agreements between the parties that do contain the classification of junior foreperson. I only seek to do that because the witness has said that it does not exist in other agreements.

PN96

THE COMMISSIONER: In others apart from Westall?

PN97

MR RICHARDSON: The union rejects that.

**** JOANNE ELIZABETH WHITEHEAD XXN MR RICHARDSON
PN98

THE COMMISSIONER: That’s fine.

PN99

MR RICHARDSON: If the Commission pleases, thank you Ms Whitehead

PN100

THE COMMISSIONER: Ms Whitehead I just have one question.
Mr Richardson took you to paragraph 44 which said:

PN101

The company believe that during the dispute all relevant matters were on the table and formulated it’s offer to settle on that basis.

PN102

The document that deals with the proposed organizational structure and the impact of the new structure which was also a page Mr Richardson took you to, says:

PN103

An increase, one senior foreman increase one foreman, transfer 17 junior foremen to level 4 classification.

PN104

Now are you saying it was your understanding as part of that settlement that you were dealing with 17 people who would be transferred to a level 4 classification and would receive the salary maintenance and that was part of the settlement as far as you’re concerned?---That’s right, yes, originally at the time there were 17, I suppose the other factor was those 17 were able to apply for the foremen - - -

PN105

The foreman position, yes?---And as it transpire there ended up being three foremen positions available rather than just the one, in which three did apply and were successful and I think a couple of those 17 left during the six months period.

PN106

All right thank you. Is there any re-examination Mr Dalton?

PN107

MR DALTON: Just a couple of questions Commissioner.

<RE-EXAMINATION BY MR DALTON [10.56AM]

PN108

MR DALTON: My colleague referred you to whether or not there had been discussion regarding subclause 20.8.1 of the agreement or subclause 20.4 of the agreement during the settlement discussions and you advised I believe they weren’t discussed. What was discussed?---Look a number of matters were discussed during the various discussions we had. We were dealing with two issues. As I said it was certainly the union’s view that both disputes should be settled in one. There were offers back and forward of various nature about who was involved in the settlement, whether it was the initial five mixed functions or it was a broader group, but certainly the view was that we were implementing a new structure that going forward there would be no junior foremen, that junior foremen classification would be resolved once and for all. That we would honour the training commitment, that we would provide the wage maintenance for an extended period, and really that in agreeing to that, plus the payment to about
15 other employees for the next functions claim, was certainly in full and final settlement and resolved at both those disputes that had been before the Commission. I mean, the company wouldn’t be entering into a settlement with the thought that there would be further payments at a later date.

**** JOANNE ELIZABETH WHITEHEAD RXN MR DALTON
PN109

Just in regard to the questions my colleague made to you regarding the training provisions for the previously junior foremen, have you had any requests for people in that group for any training that would have fitted in within the training parameters as per that proposal?---Look I’m not aware at that local level what requests have come from employees, but you know, certainly the intention of site management is still that training will be offered and undertaken.

PN110

I’ve no further questions Commissioner.

PN111

THE COMMISSIONER: Thank you Ms Whitehead you an stand down now.

<THE WITNESS WITHDREW [10.59AM]

PN112

MR DALTON: I call Mr Lawrence Baker.

<LAWRENCE EDWARD BAKER, SWORN [10.59AM]
<EXAMINATION-IN-CHIEF BY MR DALTON

PN113

MR DALTON: Could I just ask you to repeat your name and address for the record?---Lawrence Edward Baker (address supplied).

PN114

What is your current position?---State operations manager, Victoria and Tasmania.

PN115

For which employer?---Smorgon Steel.

PN116

How long have you held that position?---18 months.

PN117

Since?---November, the last week of November 2005.

PN118

Are you aware of the classification clause of junior foreman at the Westall
branch?---Yes, I am aware of that clause.

PN119

Can you tell me how it operates in practice?---Look in practice upon my arrival in November 2005 into the organization I went about my personal induction plus producing a 90 and 180 day plan. Upon part of that process was to have a look at our operational structure to move the business forward. We went about looking at our operations salary staff people at that point in time and we made an organizational structure within the first 60 days within our supervisor level, white collar level where we actually changed our structure, simplified it and redeployed into the business into safety areas and that was completed. Upon my 90 day completion, we’d also identified through the blue collar structure that there needed to be some classification and some restructure to make the organization simpler. A part of that was to assess the junior foreman. At that point in time when I arrived we had 17 junior foremen and the mix of where they were located and how they were being used was not functional. For example on day shift, I had a lot more the balance of junior foremen on certain sheds was a lot greater in other sheds. Also on afternoon and night shift the balance wasn’t set. In looking at what they were actually doing, they were actually not acting in them roles and were actually acting in the roles of our current classification between levels 2 through to level 4.

PN120

When you say they weren’t acting in those roles, can you just explain what their day to day job was?---Sure the day to day job for example of a level 2 operator is to primarily is to load and unload trucks and is to receive inbound and help support outbound. The junior foreman in for example, a long product shed, would be doing the functions of a classification level 2 operator. Within processing as you move up you get higher classifications, through level 3, level 4. We had junior foremen acting within the processing area and they were still performing the same function as a level 4 operator.

**** LAWRENCE EDWARD BAKER XN MR DALTON
PN121

Were they undertaking any tasks beyond that of an operator to your
knowledge?---No they weren’t taking on any additional tasks, them tasks were being taken on by the current foremen and senior foremen at the time.

PN122

I’ve no further questions Commissioner.

PN123

THE COMMISSIONER: Mr Richardson?

<CROSS-EXAMINATION BY MR RICHARDSON [11.02AM]

PN124

MR RICHARDSON: Thank you, Mr Baker, do you have any idea why these
17 persons were classed as junior foremen?---Mr Richardson at the point in time Andrew Kerness was appointed as the site operations manager and it was led to believe that at that point of time, that they were just given an additional, a pay incentive for that role. I don’t know the full history that was before me. Adam Nottes my predecessor, wasn’t in the business, he’d actually left the business for a period of about 60 days before I started.

PN125

So it’s your evidence that you understand in practice these persons have been paid as junior foremen but were not required to perform the duties of a junior foremen?---It was my understanding that they were being paid in that role, but as regards to actually doing any duties in that role, they were not doing any higher duties.

PN126

Mr Baker can you describe what the duties of a junior foreman are or would have been?---Mr Richardson at the time of arriving in the business, there was no set roles for a junior foreman. At that point in time there was no clear job description as to what their roles and responsibilities were.

PN127

No further questions, Commissioner. Thank you Mr Baker.

PN128

MR DALTON: I have nothing further.

PN129

THE COMMISSIONER: Sorry, just one question Mr Baker. At the time there were 17 junior foremen, how many foremen were there?---At the time give or take, I think there were roughly about 13 foremen and then there was also senior foremen on top of that. The exact numbers I can’t remember off the top of my head sorry.

PN130

So there were no shifts on which there were junior foremen where there were no senior foremen? Or there were no foremen on those shifts?---There were senior foremen across all shifts and there was a couple of positions where we didn’t have a foreman at that point in time, yes.

**** LAWRENCE EDWARD BAKER XXN MR RICHARDSON
PN131

But there was a structure above – a supervisory structure above those junior foremen on all shifts?---Correct, yes.

PN132

Okay and in formulating the new structure the new structure was to increase the senior foremen position by one, increase the foreman position by one and basically abolish the junior foremen positions and that was the structure apart from the fact, that due to changes in numbers with people coming and going but that’s essentially the structure that you then implemented?---That’s correct, yes, with a senior foreman on each shift and each shed apart from the night shift where we don’t have the numbers at this point in time.

PN133

Okay thank you.

PN134

MR DALTON: I have nothing further Commissioner.

PN135

THE COMMISSIONER: Thank you, you may stand down.

<THE WITNESS WITHDREW [11.06AM]

PN136

THE COMMISSIONER: Okay I think that’s the extent of the evidence. Mr Richardson I’ll mark you outline of submissions.

EXHIBIT #NUW1 OUTLINE OF APPLICANTS SUBMISSIONS

PN137

MR RICHARDSON: Thank you Commissioner. Commissioner given that our outline has been marked as an exhibit, if I can just take both the Commission and Mr Dalton to two errors, two typographical errors and also clarify one matter?

PN138

THE COMMISSIONER: Yes.

PN139

MR RICHARDSON: The first typographical error appears at paragraph 5.4 and in the last sentence, the word, employees, should read employers. The second appears at the next page at paragraph 5.6.2 and the reference there should be word should not.

PN140

THE COMMISSIONER: Should not be interpreted, yes, I did pick that up when I was reading the document. I know that quote and that’s not right, yes.

PN141

MR RICHARDSON: Yes, thank you. The third matter relates also to paragraph 5.6.2 whilst subject to what the Commission may say, the union doesn’t intend taking you to each of these authorities but the reference to the decision of his Honour Senior Deputy President Hancock is not one we would rely upon or seek to draw the Commission’s attention to.

PN142

THE COMMISSIONER: Right then.

PN143

MR RICHARDSON: Commissioner that being the case the union’s submissions are brief. They are brief in essence because we say we are prepared to rely in large part on our outline of submissions which has now been marked as an exhibit and as such the union simply seeks to reiterate briefly what it says is the thrust of its argument. The thrust of its argument is this, that each of the employees identified under the title of particulars of the union’s claim, was employed as a junior foreperson and had been employed for a period in excess of 12 months and that in the case of most of those employees, in fact all of those employees, their 12 month anniversary date, if I can describe it as such, had come about prior to what the union refers to as the September 2006 agreement. In the case of at least seven of those employees prior to the company proposing it’s reorganization.

PN144

The union does not dispute that from around April through to September discussions occurred between the parties as to the future of junior forepersons positions. The union does not dispute that the settlement in respect of those matters is properly recorded at paragraphs 3, 4 and 5 of the September 2006 agreement. However, we do not accept and we say it cannot be accepted that the September 2006 agreement extinguishes a right and an obligation that exists at clause 20.8.1 of the certified agreement. For the union to be successful in that argument it must convince this Commission that the proper interpretation of clause 20.8.1 is as we say it is, that an employee who is appointed to the position of foreman, shall for the first 12 months be classed as a junior foreman during which time all appropriate time training will be provided so that they can progress to foreman.

PN145

In other words we say there are two characteristics to the movement and corresponding rate of pay from junior foreman to foreman. The first is a period of time that is 12 months and the second is, the completion of the appropriate training.

PN146

THE COMMISSIONER: Isn’t there a step before that Mr Richardson, if you read the document as you’re reading it? That is that the person has to be appointed as a foreman?

PN147

MR RICHARDSON: That is Commissioner correct, however, the company can’t have it – and this goes to in a sense, our submission in reply, the company can’t have it both ways. It can’t say these people are junior foremen and are therefore are or are not entitled to the benefit of clause 20.8.1 but now also say, well no because they really should have been appointed as foremen and that we say is - - -

PN148

THE COMMISSIONER: I’m not saying whether they are saying they should or they shouldn’t have. But isn’t the submission that you’re making in relation to that clause - doesn’t it start off by saying a person who is appointed as a foreman? That’s what the beginning of that clause says and we’re talking about a group of people who have never as far as I’m aware, been appointed as foremen?

PN149

MR RICHARDSON: Well Commissioner we say that they either have to have been appointed as foremen to have been classed as junior foremen, in which case our interpretation of clause 20.8.1 should apply or alternatively, if they have never been appointed as junior forepersons, but have alternatively perhaps been paid as such based on the second hand information that appears at paragraph 65 of the company’s submission, that is to put it another way they’ve been paid - - -

PN150

THE COMMISSIONER: These people just got an over award.

PN151

MR RICHARDSON: Well if that is the case, if the Commission were to find that each of these employees was never a junior foreperson but was in fact paid a rate higher then they should have that equated to a junior foreperson. Then we say, with the greatest of respect that the September 2006 agreement does not apply to these employees and that if that is the case, the company has acted in bad faith and I know there’ll be quite rightly I suppose allegations of bad faith on the part of the union by having described these employees as junior forepersons, but now saying they never were. So it is a mess the union - - -

PN152

THE COMMISSIONER: They still would have got the benefit of the 2006 agreement because these people have continued to be paid at this rate haven’t they?

PN153

MR RICHARDSON: They continue to be paid at this rate we say because the company until these proceedings - - -

PN154

THE COMMISSIONER: Until 1 July.

PN155

MR RICHARDSON: We say the company until these proceedings has always sought to characterize and acknowledge these employees as junior foremen. Now if it does that then the Commission need only question what the meaning of the clauses in the certified agreement is. If the company now seeks to say which it appears to say in some alternative way that these employees were just store workers who were paid a higher right that equated to junior foreperson, then we say the September 2006 agreement just does not apply to them. If they are paid a higher rate – and that is permissible we say under the agreement.

PN156

THE COMMISSIONER: But on the other alternative Mr Richardson, if you say that your interpretation is correct, then the 2006 agreement is rendered nugatory anyway.

PN157

MR RICHARDSON: Well Commissioner we say that’s not the case and we say that the - - -

PN158

THE COMMISSIONER: Well insofar as it applies to paragraph 4 and 5?

PN159

MR RICHARDSON: Well Commissioner say no. We say that the 2006 agreement does not and cannot extinguish what may ultimately be - - -

PN160

THE COMMISSIONER: I’m not arguing – that’s not the point I’m saying, I’m putting to you. You are saying that either that this the alternatives, either they are foremen and they were appointed as foremen even though they were called junior foremen or they should have been made foremen after 12 months. If that was the case then clauses 4 and 5 of the 2006 agreement are meaningless because none of these people were junior foremen at that time. On the other interpretation if they were – they should never have been called junior foremen they were simply people that got paid an over award, they were appointed as foremen, they might have been called junior foremen but they were never actually appointed as foremen, the 2006 agreement doesn’t apply and they’ve just had the benefit of this over award.

PN161

MR RICHARDSON: Which we therefore say would be entitled to continue to receive that benefit.

PN162

THE COMMISSIONER: I’m not suggesting - - -

PN163

MR RICHARDSON: The 2006 agreement doesn't encompass that scenario and as such there is an onus upon the parties to resolve that matter.

PN164

THE COMMISSIONER: Okay.

PN165

MR RICHARDSON: So Commissioner, our primary position is that these people have an entitlement that was triggered by their 12 month anniversary date we say that they were properly classed as junior forepersons and that their entitlement to what I would describe as a promotion existed prior to the 2006 agreement being reached and cannot be extinguished by the 2006 agreement. We say as a matter of principle and as a matter of law. The alternate position which we put, which we’ve just traversed is that if now the company says most and that is what paragraph 65 says, most.

PN166

Although given that both Mr Baker and Ms Whitehead are not involved in the appointment of these people, we are not sure who the most are, if most of these persons are in actual fact, simply store workers paid a higher rate of pay, then the union concedes that clause 20.8.1 does not apply but we say as I’ve already indicated the September 2006 agreement does not apply either. The third point we make which is referred to towards the conclusion of our submission and Ms Whitehead gave evidence under cross-examination on is that if the Commission is to find that the September 2006 agreement has either some force or alternatively acts as a bar to these proceedings or both, that it is clear from the evidence that the company has not provided, as of today’s date, the training that was to be made available to these persons.

PN167

That was the evidence of Ms Whitehead and that training is also referred to within paragraph 3 of the September 2006 agreement. Commissioner, as I said I don’t intend unless you wish me to address you on each of the authorities, other than to say that they set out the principles as to interpretation. The union stands by its submissions in that there is no ambiguity to the extent that evidence was called it went to other matters. Not as to the meaning in our submission of the clause or for that matter the 2006 agreement and we would submit that it is only appropriate that these employees are, notwithstanding the 2006 agreement, afforded the benefit of clause 20.8.1 or alternatively if found not to be junior forepersons and as such whilst that clause has no application, nor does the 2006 agreement. Beyond that and subject to questions the union is happy to rely upon its written submissions. If the Commission pleases.

PN168

THE COMMISSIONER: Mr Richardson do you say that the terms of paragraph 20.8.1 override the terms of paragraph 20.4?

PN169

MR RICHARDSON: Yes, we do, we say so for two reasons. One there is no reference – and this is contained in our submissions there is no reference within the September 2006 agreement which implicitly or explicitly makes clear or – no I’ll rephrase that – there is no provision within the September 2006 agreement that waives rights in respect of the certified agreement, nor despite what Mr Dalton in his submission says does the 2006 agreement describe itself as full and final settlement. We would say that the terms of the certified agreement should prevail in the 2006 agreement.

PN170

THE COMMISSIONER: That’s the question I’m asking you about. I’m sorry I don’t think you got the question. The question that I asked you was do you say that the terms in the certified agreement of 20.8.1 override the terms of 20.4 of the certified agreement.

PN171

MR RICHARDSON: I beg your pardon.

PN172

THE COMMISSIONER: Sorry that’s the question I was asking you.

PN173

MR RICHARDSON: We actually say that yes they do, that 20.8.1 makes clear that promotion from junior foremen to foremen is subject only to completion of the appropriate training and the 12 month period. That clause 20.4 deals with the issue of promotion and progression generally and there are of course a number of other classifications within the agreement. So that we say that 20.8.1 should be read over and above those provisions of - - -

PN174

THE COMMISSIONER: On the basis of the specific overrides the general?

PN175

MR RICHARDSON: Yes, if the Commission pleases. I might add one point if I may. The company in its submission – because I’m happy unless anything new is introduced not to have a right of reply the company in its submissions and I only say this for the record, seems to make much of the fact that these provisions have existed in several previous agreements and the union doesn’t dispute that. However, the history of these provisions is the clause 20.4 actually comes from an agreement that was then known as the Email Metals Distribution Agreement.

PN176

Clause 20.8.1 in fact, the whole class of employee known as foreman, comes from agreements that were previously between the NUW and the company known as Steel Mark. Now Steel Mark or Smorgon’s purchased Email and this agreement, in fact several agreements, between the parties represent what I would call a cut and paste.

PN177

THE COMMISSIONER: So the clauses have different origins?

PN178

MR RICHARDSON: They have very different origins and as such we again say 20.8.1 applies to the expense more over and above 20.4. Commissioner in closing there is one matter I wish to clear up and that is the union included within its material a copy of a letter to Mr Jang – J-a-n-g, that was from Mr Baker and in the company’s submissions, the company questioned the inclusion of that. In particular I think it is paragraph 76 and 77 of the company’s submissions. Now it is pleasing to note that Mr Jang has indicated that he wishes to continue as a foreman and as such the letter effectively has no relevance.

PN179

Save and except this, that the letter that Mr Jang received sought to apply the relevant terms of the 2006 agreement that the company says should apply to the junior foremen. That is, that Mr Jang would receive the benefit of wage maintenance until 1 July of this year. What the letter also makes clear is that Mr Jang was a foreman, not a junior foreman.

PN180

THE COMMISSIONER: Sorry where’s that – sorry where’s the 1 July this year? It says the company will continue to pay your current weekly rate until the level 4 rate reaches this amount.

PN181

MR RICHARDSON: Yes

PN182

THE COMMISSIONER: As a consequence you will not receive an increase in your pay rate until approximately July 2009.

PN183

MR RICHARDSON: Sorry Commissioner I’ can’t hear you I beg your pardon?

PN184

THE COMMISSIONER: Sorry, the letter that I have which is a letter dated 6 March 2007 makes no refer to 1 July 2007, it says the company will continue to pay your current weekly rates until the level 4 rate reaches this amount, as a consequence you will not receive an increase in your pay rate until approximately July 2009 depending on future EBA wage increases – as I understand it this is a simple grandfathering of this person.

PN185

MR RICHARDSON: I beg your pardon, that is the case, and I apologise. However, there is no agreement between the parties in respect of what happens to Mr Jang.

PN186

THE COMMISSIONER: Well I don’t know that it’s at all relevant to these proceedings, it’s a totally separate issue. As I understand it’s an issue that’s now been resolved because Mr Jang has decided that he wishes to retain the provision – the position as foreman, but for the company to come to an agreement either with him or with the union as to salary maintenance should he determine not to continue as a foreman, is a matter separate from this dispute.

PN187

MR RICHARDSON: Well Commissioner with respect we say no because again we acknowledge that Mr Jang has agreed to retain the position and the duties of foreman and therefore it is a mute point. We say that the letter has not been the subject of any discussion between the parties and to the extent that it’s relevant and I apologise for incorrectly referring to 1 July. We say it stands in our view as evidence for the company operating outside the September 2006 agreement. There was never any discussion about what would happen in the event that a foreperson did not wish to continue in those responsibilities.

PN188

Now leaving aside Mr Jang having agreed to continue in those responsibilities and what discussions may or may not have occurred between him and the company in that sense the Commission is correct, it may be the matter, it may be the subject of a separate application to the Commission.

PN189

THE COMMISSIONER: Well it would be a separate - - -

PN190

MR RICHARDSON: But the company appears to apply the 2006 agreement when it wants to and we say it has in effect, or did in effect seek to apply it in a similar way to Mr Jang, grandfathering, which is essentially what occurs with the persons classed as a junior foreperson, but then doesn’t seek to apply the agreement when it comes to training, to the 14 individuals that we are referring to. But I won’t press the point.

PN191

THE COMMISSIONER: I’m sorry you’ve totally lost me Mr Richardson because it does seem to me that the decision to take this action in relation to
Mr Jang is not in any way related to the 2006 agreement as I understand it and this is something that occurred subsequent to - - -

PN192

MR RICHARDSON: Well Commissioner with respect we say it is because Mr Jang was confronted with this situation as a consequence of the reorganization that is referred to in the 2006 agreement. Commissioner, the point takes us nowhere - - -

PN193

THE COMMISSIONER: To the extent that it is the restructuring that caused him to decide he didn’t want to be a foreman anymore. I mean that’s not clear in this letter.

PN194

MR RICHARDSON: We don’t know that he did not wish to continue to be a foreperson, in fact we assert that he was advised that as a consequence his rate would be grandfathered. Commissioner I concede the point the - - -

PN195

THE COMMISSIONER: I think it’s a bit remote from what I’m trying to deal with because I certainly don’t have the facts Mr Richardson, and I don’t know that you can draw any conclusions from this letter, except there is – there was and possibly no longer is some issue in relation to Mr Jang where the suggestion that his rate of pay be grandfathered was made. I mean that’s all you can get from that letter.

PN196

MR RICHARDSON: I withdraw the point, if the Commission pleases. Commissioner, beyond that we seek to say nothing as I said we rely upon our written submissions, if the Commission pleases.

PN197

THE COMMISSIONER: All right thanks Mr Richardson. Mr Dalton?

PN198

MR DALTON: Thank you Commissioner, look just on that last point I must admit I’m totally confused as to it’s relevance. My instructions are that Mr Jang was a foreman, not a junior foreman and in terms of that there was a particular arrangement and it’s come to a particular circumstances and wasn’t linked to the 2006 agreement, so as I say I’m totally confused as to what relevance that might have. Now in terms of this particular matter we rely on our outline submissions and the witness evidence that has been presented. I’m also as I say, slightly confused by the union’s argument.

PN199

It appears to be a have your cake and eat it too argument from our perspective in that introducing concepts of over award payments we find it as I say very confusing that they are one thing or another. Clearly when the company decided that it needed to restructure the supervisory classifications including the junior foremen grouping, it had the proposal. It sat down with the union. It informed them of what they were proposing. It had discussions with them. The parties met on numerous occasions. Offers to settle went backwards and forwards and finally an offer to settle was agreed, accepted by all the parties involved and that offer to settle – it was clear within that offer to settle, that the classification or grouping of junior foremen would cease to exist.

PN200

Now if a category of employees ceases to exist, it is our position that it defies logic and commonsense for it then to be a situation where provisions that relate to that grouping continue to have a life. From the company’s point of view, if it was made clear at the time when they were discussing with the union that by the way, you know, we’re still going to go for these people to be foremen at some point down the track, that would have changed the colour, it would have changed the negotiations completely. I don’t think that because a sentence is missing from an agreement which says that this is full and final settlement, in terms of that clearly in the minds of the parties at the time it was full and final settlement, and I would submit that it was even in the minds of the union at the time that it was full and final settlement because it is only six months later nearly that this issue has come up.

PN201

So in terms of that if it wasn’t in full and final settlement and the union was aware that these people were beyond their 12 months as specified in 20.8.1 why at some point subsequent to the agreement it says by the way we need to deal with this issue now, clearly as I say, it has come up later, because it was never envisaged as an issue and that the issue of the reclassification was dealt with. I mean the company has done the right thing here Commissioner. The company has come up with a proposal to fix a particular problem. It sat down with the people who are affected. It sat down with their representatives and it has nutted out an agreement to settle that issue.

PN202

Now I don’t know what more a party can do in terms of being consultative and participatory and transparent in developing a solution to a problem. For this to now be re-opened, we say it completely defies logic and commonsense. From the company’s point of view and I think from everybody’s point of view at that time of the September 2006 agreement the matter was settled. The future of the grouping of people who were previously known as junior foremen was determined, their future was known and there was an arrangement in place that would compensate them for that change.

PN203

Now I think that in terms of that it is inappropriate that this matter be reopened. It is our view that the provisions that the union’s say apply to the reading of 20.8.1 apply to the agreement at September 2006 and a plain reading of that agreement is that the parties have settled the issue of reclassification. That the future of the grouping of previously known as junior foremen is determined and that that should proceed as per the agreement that the parties have determined and they determined that agreement freely and willingly. It wasn’t an arbitrated decision imposed on them by the Commission. It was an agreement between the parties. So in terms of that agreement should be allowed to stand.

PN204

Now in terms of the application of the agreement our submission is that 20.8.1 does not override 20.4. The whole clause needs to be read together and it is clear that – and I’m not sure of the genesis of 20.4 of the agreement but I’ve seen that clause in a number of awards, Commissioner - - -

PN205

THE COMMISSIONER: I’ve seen it in a number of agreements.

PN206

MR DALTON: In terms of that I believe it is a well accepted practice across industry that you are promoted into a job when a job exists that you are not promoted into a job where no job exists. So in terms of that – the issue of saying that your promotion depends upon the effluxion of time, I think that that mode of promotion went out a long, long time ago. Clause 20.4 clearly has an integral part to play in the agreement and in the way that the classification structure and the recruitment structure works at the shop floor.

PN207

Now there may have been a confusing state of affairs around how the junior foremen grouping worked in practice and that the new management came in and decided – and in identifying that confusion sought to clear up that problem. The result is the September 2006 agreement. We say that the September 2006 agreement is a solution to that confusing state of affairs and that is now beyond comprehension to think that there are 13 or so employees who are now to be given jobs as foremen where no jobs as foremen exist simply by the operation of a clause that we say was extinguished with the extinguishment of the junior foremen classification.

PN208

I believe that everything else is reasonably covered in the outline of submissions Commissioner and we would leave our submissions there if the Commission pleases. If you have nay further questions I’m happy to deal with them.

PN209

THE COMMISSIONER: No, I don’t think so Mr Dalton. Mr Richardson is there anything – I don’t think there is anything Mr Dalton said, that’s not covered in the submissions?

PN210

MR RICHARDSON: None Commissioner thank you.

PN211

THE COMMISSIONER: All right then, thank you I think Mr Richardson you indicated that the classification of junior foremen existed in other agreements, if you wish to provide, not necessarily the agreements, but to the company and to myself a list of other agreements, where you say that classification exists, I would be happy to consider that as part of the overall material before me. I don’t know that it’s of extraordinary moment in terms of the issue for determination here. I accept that it is a classification in other agreements, whether that makes a huge amount of difference or not to the issues here or not is another question.

PN212

MR RICHARDSON: Commissioner, the desire of the union to inform both the Commission and the company of those other agreements is simply to correct Ms Whitehead’s evidence, as we see that as wrong.

PN213

THE COMMISSIONER: I’ll simply take it that - - -

PN214

MR RICHARDSON: We acknowledge that it doesn’t in any way, or could not in any way bear upon any decision you might make.

PN215

THE COMMISSIONER: No I’ll simply take it that Ms Whitehead is not aware of such agreements, but that such agreements do exist. I’m prepared to accept that as your evidence from the bar table Mr Richardson.

PN216

MR RICHARDSON: I only seek to tease the point out because Ms Whitehead is the human resource manager for Smorgon Steel and what the NUW is saying is that there are other agreements between the NUW and Smorgon Steel that contain that classification. Her evidence was that there are no such other agreements. If the matter – I appreciate that it’s just a matter of clarifying something but it’s an important matter.

PN217

THE COMMISSIONER: Yes, well on that basis Mr Richardson if you provide me with the names of those agreements where such classifications exist, I will take that as being part of the material before me.

PN218

MR RICHARDSON: If the Commission pleases.

PN219

THE COMMISSIONER: Otherwise I will reserve my decision in relation to this matter.

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