BP2007/4511, Transcript of Proceedings [2007] AIRCTrans 710 (21 December 2007)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 17890-1

COMMISSIONER BLAIR

BP2007/4511

s.451(1) - Application for order for protected action ballot to be held
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union
and
GTE Workplace Management Pty Ltd
(BP2007/4511)

MELBOURNE

9.35AM, TUESDAY, 04 DECEMBER 2007

Continued from 29/11/2007

PN6

MR J WIELADEK: I appear for the AFMEPKIU.

PN7

MR J FINCH: I'm from Betta Foods Australia.

PN8

MS G TOMBOLATO: I'm from GTE Workplace Management and Grace Tombolato Enterprises.

PN9

THE COMMISSIONER: Thanks Ms Tombolato. Mr Wieladek.

PN10

MR WIELADEK: Yes sir.

PN11

THE COMMISSIONER: The matter was listed last week for programming and mentioning. Now in the interim the Commission has received advice from the Australian Electoral Commission setting out a proposed timetable. Directions were issued in terms of the Acts inviting anybody who would be subject to the proposed agreement being able to make submissions this morning. The Commission did receive some indication from Mr Finch from Betta Foods indicating that Betta Foods would wish to make some submissions in regards to the application along with Ms Grace Tombolato from Grace Tombolato Enterprises Pty Ltd. So we may hear from Mr Finch and Ms Tombolato
Mr Wieladek.

PN12

MR WIELADEK: Yes sir.

PN13

THE COMMISSIONER: Yes Mr Finch.

PN14

MR FINCH: Commissioner if I may I'd like to table a written as well as a verbal submission to the Commission.

PN15

THE COMMISSIONER: Thank you.

PN16

MR FINCH: Good morning and thank you for the opportunity to be able to make this submission to the Commission. My position with Betta Foods is general manager operations and I'll explain Betta's interest in the matter. Employees of Grace Tombolato Enterprises work at Betta Foods providing maintenance services for food manufacturing plant and equipment. Betta Foods is an Australian company located in Broadmeadows, Victoria. Betta manufactures confectionery for local and export markets. Betta was established in 1954 and was a family owned company until 2004. After years of financial losses the company went into a ..... administration in that year and the control of company was transferred to private investors.

PN17

Betta Foods remains under a deed of company arrangement. Throughout 2005, 2006 and 2007 the current company management has endeavoured to re-establish Betta as a viable profitable enterprise. The company has excellent prospects for the future given the quality of the products it makes and increasing demand for the international markets. Although the company has made simple progress over the recent years and invested substantive capital it has suffered greatly due to rapidly rising commodity prices for raw materials. This has set progress back significantly. The majority owners of the business have lost patience. They are not willing to put more capital into the company and are in fact willing to sell out to management.

PN18

The management buy out requires refinancing of the property to ensure survival. This deal is still under negotiations and is delicately poised. In the meantime the company has no breathing space. Due to prior decades of low investment in plant maintenance improvements the company is particularly vulnerable. The service provided by the maintenance work force is vital to keep the plant running every day. A reduction of the maintenance service will result in stoppages of production lines and failure to fulfil customer orders. Production employees will be stood down if their lines stop. The result loss of sales and revenue cannot be sustained by any reserve of funds and the company will immediately go into administration and seize operation.

PN19

Betta Foods appeals to the Australian Industrial Relations Commission to decline the application for a protected action ballot in order that Betta Foods can continue to operate, survive, grow and eventually prosper, benefiting all employees. Thank you Commissioner.

PN20

THE COMMISSIONER: Thanks Mr Finch. Ms Tombolato.

PN21

MS TOMBOLATO: Commissioner if I may also table a written and a verbal submission to the Commission. ..... Grace Tombolato Enterprise Pty Ltd we were hired out to be - who were hired out to Betta Foods Australia, sorry and provide maintenance services for food manufacturing plant and equipment. GTE is a labour hire recruitment company which recruits permanent, casual, contract and temporary employees on behalf of its clients. In this case however in 2000 Grace Tombolato previously operating under Catch Recruitment Pty Ltd took over the employment and indirect management some of the full time, casual, and contract employees. Since working with BFA, GTE along with BFA have on behalf of its employees signed and abided by the respective agreements with the particular unions i.e. the LHMU and the AMWU.

PN22

In August 2004 BFA went into voluntary administration which ultimately could have seen all the positions of BFA relinquished. This had also jeopardised GTE as a company. To assist their ..... administration period GTE continued to service BFA which in turn would ultimately salvage employee positions to BFA. Since the administration period the management team of BFA have changed and they are may I say the best management I have worked with since my dealings commenced with BFA in 2000.

PN23

The company is currently in the process of not only having to pick up the pieces, face rapidly rising commodity prices of raw materials but also have to refinance if previous investors no longer wish to participate in BFA's future. I have personally spoken to Tony Mavromatis and have relayed the current position that at present until management has finalised its dealings BFA and in turn GTE are in no position to further negotiate or commit further demands made by the AMWU and its members.

PN24

GTE appeals to the Australian Industrial Relations Commission to decline the application for protected action ballot in order the BFA can continue to operate and survive. As any industrial action taken by these respective workers would not only jeopardise the company and in turn GTE but also their positions and the positions of their other 220 colleagues. Thank you.

PN25

THE COMMISSIONER: Thanks Ms Tombolato. Yes Mr Wieladek.

PN26

MR WIELADEK: Thank you sir. Sir ..... the union seeks to persist with its application to get ballot from the Industrial Relations Commission for protected action. I've heard the submissions of both my friends at the Bar table. They, whilst providing context do not impinge the AMWU's ability to seek a ballot from this matter. If I turn the Commission to the union's application the application has fulfilled the statutory requirements of section 453 with its attachments A, E, C. The notice of bargaining period has been attached and that's been signed by Gary Robb, the authorised officer of the AMWU and authorised to such by our state council.

PN27

Also in there is a disclaimer containing prohibitive content. The union hasn't been intentionally seeking prohibitive content in anyway with the negotiations with the respondent. Attachment B reflects that notice of appointment of Gary Robb. Attachment C is the relevant declaration under section 453(4) pursuant to regulation 9.7 chapter 2 of the Act ..... regulations . There are further attachments which are draft orders, certain written submissions and a number of draft orders regarding the ballot order. We say that on the procedural side of things the union's application fulfils all the statutory requirements.

PN28

On the substantive side there are three tests which are prescribed by the Workplace Relations Act in respect of protective action ballot. In section 461 it must be shown that firstly the applicant is genuinely trying to reach an agreement, in the present tense, has been genuinely trying to reach an agreement with the party and is not engaged in patent bargaining.

PN29

There is no indication whatsoever that patent bargaining as defined under section 421 of the Act is an issue and I haven't heard any submissions from the company to that effect so we say that that requirement is fulfilled. As to the other two requirements, genuinely trying to reach agreement has been considered by Justice Marshall in the Gene Kay O'Connor case in the Federal Court and there it was held that that test, that condition is a - a serious preparedness to consider any offers and proposals made by the union. Of course that's in the reverse sense in this case because that case considers a lockout as opposed to our case where we seek to apply for ballot for industrial action and that view's been supported and adopted by the Commission in Her Honour's decision Senior Deputy President Acton's decision in Cadbury Schweppes v CEPU and AMWU.

PN30

We say that any reading of the negotiation issue of this case would suggest to the Commission that these conditions have been satisfied. Mr Mavromatis is the relevant organiser for the site and he joins me at the Bar table. I can briefly run through his instructions to me. Since early September there's been between 10 or a dozen meetings concerning the enterprise bargaining agreement that the union seeks to make and of all the issues that have been notified in our bargaining - our notice to initiate bargaining periods there are only few which remain out of line. That includes the pay increases, the treatment of income protection by the agreement and where a 36 hour week takes place and severance pay and ..... pay.

PN31

So it's down to a handful issues at the end. We say that because the statutory requirements have been fulfilled the Commission is obligated under the Act to grant the order made by the applicants and we also, I suppose as an aside we do say that this is only an application to have a ballot order. There is no - industrial action is not a predetermined outcome of all this. This is just the opportunity of the members of the applicant to seek to have a ballot order at this point.

PN32

So on that basis we say that the application should be made and it's approximately for 10 people. It will be held in Broadmeadows. We prefer an attendance ballot. We'd probably be able to get all 10 at once and between the hours of three and four we'd be able to catch the lot of them. If the Commission pleases.

PN33

THE COMMISSIONER: Right thank you. Mr Finch do you wish to make any further comment?

PN34

MR FINCH: The company agrees that there have been a number of meetings between the union and the company in pursuit of trying to reach an agreement. Those discussions started before the expiry of the enterprise bargaining agreement that the employees were under. That agreement expired at the end of September. Throughout those meetings the company hasn't sought to make any radical changes to the terms and conditions of employment of those employees. From the outset our position was just to retain things status quo whilst the company was reorganising, restructuring and refinancing. The AMWU did provide a lot of claims for changes they wanted to make to the terms and conditions of employment. The company explained that it wasn't able to, financially, to afford any improvements to the employees. The company's sympathetic to their cause and appreciates that in the regular scheme of things employees would be entitled to annual pay rises to improve their standard of living and to meet the costs of our lifestyle. But the company reiterated that it couldn't afford any changes.

PN35

The company has offered a four per cent pay rise from 30 June 2008 and some subsequent pay rises of four per cent after that time as part of a three year agreement with the AMWU. Some of the other claims that the AMWU have made appealing to the company require risk or expenditure that we can't sustain at the moment. Thank you Commissioner.

PN36

THE COMMISSIONER: Right, thank you. Ms Tombolato do you wish to
make - - -

PN37

MS TOMBOLATO: Thank you Commissioner. I fully support what Mr Finch has just reiterated but also in good ..... faith I think it's important to note that since the administration period we did renegotiate an agreement with the AMWU and allow for a 21 per cent increase in wages over the last thee years, which also put our workers on average 30 per cent above the award rate. It's important also for us to note that with our other union that we have present at BFA they have since agreed to support us to see the difficult times through to ensure that in the nearby future we can actually sit down and agree and hope we can put something to the table that everyone agrees with. Thank you Commissioner.

PN38

THE COMMISSIONER: Thank you. It would appear to the Commission, let me say that at the Commission is sympathetic to the arguments put forward by
Mr Finch on behalf of Betta Foods Australia, Ms Tombolato on behalf of GTE Workplace Management. The only discretion appears to be in regards to the application under section 461 which says:

PN39

During the bargaining period the applicant genuinely tried to reach agreement with the employer of the relevant employees -

PN40

And there's no issue that the parties have been negotiating. The applicant is genuinely trying to reach an agreement with the employee. Again there doesn't appear to be any dispute. There are some issues that divide them but that's always the case. And the applicant is not engaged in patent bargaining and that's not what's being put today. But the only other discretion goes to whether or not the application would be inconsistent with the object of this division see section 449.

PN41

Section 449 says:

PN42

The object of this division is to establish a transparent process which allows employees directly concerned to choose by means of a fair and democratic secret ballot whether to authorise industrial action supporting or advancing claims by organisations of employees or by employees.

PN43

And then 449(2) goes to spelling out it's not protected action ballot unless it's been authorised in advance by secret ballot unless of course it's in response to a industrial action by the employer, then the employees can respond accordingly. That appears to be the only discretion that the Commission has in regards to whether or not it should decline the application for the ballot. Mr Wieladek has put on behalf of the union that all the requirements that say that the Commission should grant that the application for the ballot have been met and there doesn't appear to be any argument that they haven't been met.

PN44

So although the Commission is sympathetic to the argument of Mr Finch and
Ms Tombolato it really doesn't have that much discretion to refuse the application. And accordingly it will grant the application. Material has been provided by the Australian Electoral Commission setting up a time frame. Now I understand that its proposal be a ballot by attendance and what we would need is that appropriate time where the employees and I understand there's only a small number of employees involved, are able to attend, cast their ballot at a convenient place on site and then the Electoral Commission would close the ballot, count the ballot and inform the parties.

PN45

What the Commission will indicate to Mr Finch and Ms Tombolato there are provisions in the Act that do provide that if you are affected economically you can make application to suspend the bargaining period and the time, the discretion is up to the Commission as to whether it grants that and for what time frame. But it only indicates that the bargaining period can only be suspended a maximum period of twice. Then beyond that there's no further applications for suspension. But as yet we haven't had the results of the ballot so I think we need to look at that and see what happens. What's a convenient time for the ballot to open and close on site? Mr Finch?

PN46

MR FINCH: Commissioner I think the ballot can be conducted on any workday during normal business hours during this week. They will be convenient for the company.

PN47

THE COMMISSIONER: Well it's proposed that next week Tuesday the 11th be the day in which the AEC would have an officer on site. And so they're not there all day - - -

PN48

MR FINCH: Yes.

PN49

THE COMMISSIONER: - - - a convenient time to the parties so that, say an hour time frame where they come in and vote and go back to the job.

PN50

MR FINCH: Well I'd suggest Commissioner that 9 am on Tuesday 11 December would be definitely a time.

PN51

THE COMMISSIONER: Nine through to 10 am?

PN52

MR FINCH: Yes.

PN53

THE COMMISSIONER: Thanks Mr Finch.

PN54

MR FINCH: Thanks Commissioner.

PN55

MR WIELADEK: Yes that's fine with the union.

PN56

THE COMMISSIONER: Okay and the actual address of the site for the - I don't want the AEC to be running around the suburbs somewhere.

PN57

MR FINCH: The address Commissioner is 25-49 King William Street, Broadmeadows.

PN58

THE COMMISSIONER: Right. Okay and that would be between 9 am and
10 am on Tuesday the 11th. What the Commission will do also is indicate to the parties that even once the ballot has been conducted and regardless of the outcome of the ballot the Commission is always available to try and assist the parties in negotiating an agreement if they think the Commission would be of assistance to them. We're always happy to do that and we can do that on site if that's more convenient for the parties to do that. All right the Commission will issue the orders accordingly and again ..... to assist the parties if they deem it, can be of some help to them. The Commission will stand adjourned, thanks.

<ADJOURNED ACCORDINGLY [9.58AM]