BP2008/2958, Transcript of Proceedings [2008] AIRCTrans 183 (24 April 2008)

TRANSCRIPT OF PROCEEDINGS

---

Workplace Relations Act 1996 18371-1

COMMISSIONER THATCHER

BP2008/2958

s.451(1) - Application for order for protected action ballot to be held
Automotive, Food, Metals, Engineering, Printing and Kindred Industries Union
and
Big Sister Foods Pty Ltd
(BP2008/2958)

SYDNEY

11.57AM, THURSDAY, 10 APRIL 2008

PN1

MR A NEILSON: If it pleases the Commission, I appear for the applicant union. I appear with MR G WALLACE and MS M BURGESS.

PN2

MR S SCHMITKE: If the Commission pleases I am from the Australian Industry Group. I appear for the respondent, Big Sister Foods Pty Limited. I have with me at the Bar table MR J REGAN, who is the general manager of the respondent company.

PN3

THE COMMISSIONER: This matter was originally listed for yesterday but was adjourned to today at the request of the applicant due to the unavailability of its representatives. I should add that as a result of the directions the Commission received an email from the Australian Electoral Commission which you now - has been made available to you. If not I’ll as my associate - they have it?

PN4

MR SCHMITKE: Yes.

MFI #1 EMAIL FROM AUSTRALIAN ELECTORAL COMMISSION TO AIRC

PN5

THE COMMISSIONER: Yes, Mr Neilson.

PN6

MR NEILSON: Thank you, Commissioner. The union, as the Commission would be aware, has filed an application for a protected action ballot. As part of the directions that were issued by the Commission on Tuesday the respondent has indicated that it opposes that application. Then in my discussions this morning with Mr Schmitke, he has indicated that he maintains that opposition.

PN7

Therefore, what we would propose to do is to call Mr Wallace who is the union official responsible for the negotiations at the site to give evidence so as to satisfy the Commission that the requirements of section 461 have indeed been met. Then we would propose to make submissions as to why the Commission should make that order. Unless the Commission has anything further, I won’t make any opening comments in relation to the application and we seek to call Mr Wallace.

PN8

THE COMMISSIONER: Before you do, could I just ask Mr Schmitke - the Commission, my Chambers, received an email with an outline of submissions. Has that been made available to the applicant union?

PN9

MR SCHMITKE: Yes, it has, Commissioner.

PN10

THE COMMISSIONER: Thank you very much. Yes, Mr Neilson, we’ll hear your evidence.

PN11

MR NEILSON: Yes. I seek to call Mr Geoff Wallace.

<GEOFFREY KEITH WALLACE, SWORN [12.01PM]

PN12

MR NEILSON: Perhaps before Mr Wallace starts can I just - my friend has indicated that he proposes to call Mr Regan who is present in the room. Given the potential for Mr Regan to benefit from hearing from Mr Wallace’s evidence, we would ask that he be directed to leave the room.

PN13

THE COMMISSIONER: Yes, Mr Schmitke?

PN14

MR SCHMITKE: Commissioner, I have no opposition to that direction, subject of course to myself being allowed, if required, a brief moment to seek instructions at the conclusion of the witness’s evidence.

PN15

THE COMMISSIONER: Very well. Thank you, Mr Schmitke.

<EXAMINATION-IN-CHIEF BY MR NEILSON [12.02PM]

PN16

MR NEILSON: Could you please state your full name, address and occupation for the record, please?---My name is Geoffrey Keith Wallace. I live at 16 Killarney Avenue, Glenmore Park and I’m an AMWU official for the AMWU.

PN17

Mr Wallace, have you caused to be prepared a statement for the purposes of these proceedings?---Repeat that again, sorry?

PN18

Have you caused to be prepared a statement for the purposes of these proceedings?---Yes.

PN19

Do you have a copy of that statement with you?---No.

PN20

I provide you with a copy. Do you now have a copy of the statement?---Yes. That’s right. I have.

PN21

Can I ask you to turn to page 3 of that statement?---Page 3, yes.

PN22

You will see that there appears to be a signature on that page?---That’s my signature.

PN23

Can I confirm that that is your signature?---It is.

PN24

Is this statement true and correct to the best of your knowledge?---This - it is.

PN25

MR NEILSON: I seek leave to tender a copy of that statement, Commissioner. My friend has been provided with a copy of it.

**** GEOFFREY KEITH WALLACE XN MR NEILSON

EXHIBIT #N1 STATEMENT OF GEOFFREY KEITH WALLACE

PN26

MR NEILSON: Thank you, Commissioner.

PN27

Mr Wallace, I just want to show you a number of documents, if I may - and I apologise to your associate in advance. Mr Wallace, I have handed to you a number of documents and I just wish to take you through them. The first is a document which is headed, “Notice to Initiate a Bargaining Period”?---Yes.

PN28

Do you see that?---Yes.

PN29

Can I have you turn to page 2 of that document?---Yes.

PN30

Do you see a number of bullet points with various claims next to those bullet points?---Yes, I do.

PN31

Are those claims that are annexed to those bullet points your log of claims?---Yes, they are.

PN32

Have you communicated that log of claims to the representatives of the respondent?---Yes, I have.

PN33

Can I have you turn to a single-paged document which is headed and underlined, “Big Sister EBA”?---Yes.

PN34

MR NEILSON: Commissioner, it may be appropriate to mark each individual document separately so as to not confuse them as a bundle.

PN35

THE COMMISSIONER: Okay. The first one we’ll make that MFI2. It is hardly an exhibit, is it?

PN36

MR NEILSON: No, that’s correct, your Honour.

MFI #2 FORM R4 RULE 16

PN37

MR NEILSON: Do you have that Big Sister EBA, underlined document in front of you?---I have. To the best of your knowledge who prepared this document?---The company.

PN38

Who from the company?---Mr Joe Regan.

**** GEOFFREY KEITH WALLACE XN MR NEILSON
PN39

And who is Mr Regan?---He’s the general manager or the plant manager for Big Sister, Ermington.

PN40

And has Mr Regan conducted the EBA negotiations on behalf of the company?---Yes, he has.

PN41

When was this document, to the best of your knowledge, given to you?---On my second meeting with Mr Regan on the 11th of - on 11 December 2007.

PN42

Can I have you turn to point 2 of that document?---Yes.

PN43

And just take a moment to read that.

PN44

THE COMMISSIONER: Are you intending to introduce this as an exhibit or will we just mark it - - -

PN45

MR NEILSON: I’m happy to introduce it as an exhibit, Commissioner. I understand my friend will refer to it. Are you going to refer to it?

PN46

MR SCHMITKE: I wasn’t going to.

PN47

MR NEILSON: All right. Perhaps just mark it as an MFI.

MFI #3 DOCUMENT HEADED “BIG SISTER EBA POINTS FOR DISCUSSION” 11/12/2007

PN48

MR NEILSON: Have you had the opportunity to reach point 2?---Yes, I have.

PN49

What do you understand the reference to “MOU” to mean?---How I see it to mean is on our - my first meeting with Big Sister back in 22 November I - before the log of claims was actually reached to the company, I asked Mr Regan would he oppose an MOU for the prohibited matters. Mr Regan has asked - then asked me to - because he didn’t know what an MOU was - he asked me to go away and draw one up, which I did, and I gave it to him on the date of this meeting here.

PN50

What did you propose that the MOU would deal with?---With all the prohibited matters that we couldn’t have in our previous EBA.

PN51

And did you indicate to Mr Regan that agreement on the enterprise agreement would be dependent on agreement for the MOU?---No, I didn’t.

**** GEOFFREY KEITH WALLACE XN MR NEILSON
PN52

And did Mr Regan indicate an opposition to the formation of an MOU?---No, he didn’t.

PN53

You’ll see, Mr Wallace, at point 7 the clause, “Remove the labour hire and contract labour clause” - do you see that?---Yes, I do.

PN54

There appears to be a marking next to that. Can you identify that marking?---Yes, that was a tick where - my understanding was that clause then was going to be put into the MOU, that it didn’t matter.

PN55

Were you pursuing a clause which regulated the use of labour hire and contract labour in the enterprise agreement?---No, I was not.

PN56

And have you pursued such a clause?---No, I have not.

PN57

Thank you. Can I have you turn to the third document which is dated 27 February 2008 and appears on AMWU letterhead?---Yes.

PN58

Do you have that document with you?---I do.

PN59

MR NEILSON: Perhaps if we could mark that, Commissioner, as an MFI also.

MFI #4 LETTER FROM AMWU DATED 27/02/2008

PN60

MR NEILSON: You will see at point 2 the reference to the MOU again and the words, “Union agrees”?---Yes, I do.

PN61

What did you mean by that?---My understanding is both parties agreed that the MOU would be drawn up and it wasn’t going to be an issue for Mr Regan.

PN62

At the time of writing this letter, was an MOU the subject of discussion between the company?---The only discussion I had with Mr Regan on an MOU was at our first meeting. I then had a second meeting when I handed it to him back in - on 11 December.

PN63

And had you indicated on or around the 27th February that agreement on the Enterprise Agreement was dependent on agreement on an MOU?---I did not.

PN64

You will see at what is approximate point 6 the words, “Restriction of use of labour hire companies - union disagrees”, do you see that?---I do.

**** GEOFFREY KEITH WALLACE XN MR NEILSON
PN65

Can you indicate to the Commission what you had intended by writing that particular provision?---Mr Regan had it on his log of claims back to the union dated 11th of the 12th and as far as I was concerned I couldn’t talk about it because it was a prohibited matter so that’s why I disagreed because it was on his document. I could not talk about it and I disagreed with it.

PN66

So the union had not in any way whatsoever sought to restrict the use of labour hire companies through the enterprise agreement?---Not - no, I did not.

PN67

Can I have you turn to the fourth document, which is again headed, “Australian Manufacturing Workers Union” and underneath it, “Big Sister Foods Sim Plot”, do you see that?---Yes, I do.

PN68

MR NEILSON: Perhaps that could be marked as an MFI too.

MFI #5 PIECE OF PAPER HEADED AMWU/BIG SISTER FOOD SIM PLOT

PN69

MR NEILSON: Who prepared this document?---I did.

PN70

And who did you provide it to?---To the workers for a mass meeting.

PN71

Did you provide it to anyone at the company?---I did after our mass meeting.

PN72

And can I have you read point D, please?---Yes.

PN73

I spoke to the workers at our meeting and told them that Joe wanted to talk about the use of labour hire and I told the workers we disagreed with it because I could not talk about it.

PN74

THE WITNESS: Because if I talk about it having these - in these discussions about an EBA - while an EBA’s going, it’s a prohibited matter and this where I’ll end up. This is where I’ve ended up.

PN75

MR NEILSON: When you referenced because Joe wanted to talk about it, who were you referring to?---Mr Regan, the general manager of the plant, or the plant manager.

PN76

You will see at point 2 the words:

**** GEOFFREY KEITH WALLACE XN MR NEILSON
PN77

This mass meeting instructs the AMWU to pursue the log of claims endorsed by the rank and file at Big Sister.

PN78

Is that log of claims what I showed you earlier in MFI 2?---It is.

PN79

Is there anywhere in that log of claims, to the best of your knowledge, which states that you are a seeking a clause restricting the use of labour hire?---Not whatsoever.

PN80

Yes, thank you. As at today’s date, what is your understanding of discussions in relation to a proposed MOU?---My understanding is the company has a copy of an MOU and they were going away to have a look at it and they send it back to us. That’s my understanding and the company - my understanding - had agreed for the MOU to put the prohibited content in there so there’s - there were no more discussions on these casuals because it was going to be moved over there.

PN81

As at today’s date, is the company’s agreement on a proposed MOU dependent upon the union reaching agreement with the company on a proposed enterprise agreement?---No, it’s not.

PN82

MR NEILSON: Yes. No further questions, Commissioner.

PN83

THE COMMISSIONER: Yes, Mr Schmitke.

<CROSS-EXAMINATION BY MR SCHMITKE [12.13PM]

PN84

MR SCHMITKE: Mr Wallace, can I looked at just to MFI5 which is the last document?---The resolution, yes.

PN85

Just for the benefit of myself and indeed the Commission, this particular document was produced as a result of a mass meeting on, as I understand it,
14 March this year. Is that correct?---The same day of my last meeting with the company, yes it was. In the morning.

PN86

So that was your last meeting with the company?---I had a mass meeting with the workers in the morning at half past 6, 7 o'clock and then I had a meeting with
Mr Regan at half past 11 that morning.

**** GEOFFREY KEITH WALLACE XXN MR SCHMITKE
PN87

Thank you. And during this mass meeting the proposals put by Big Sister being removing restrictions on labour hire, that was put to the employees at that meeting, is that correct?---I put what Joe Regan’s proposal is and I still let the workers know I can’t talk about it. I can’t talk about it through the CBA because it’s a prohibited matter. Because the workers out there received a letter from
Mr Regan where he had that in there and workers asked me what does it mean, I said we can’t talk about it. A prohibited matter.

PN88

So Mr Wallace, just to confirm what is your understand of the effect of 1(d) within that document?---Restriction. My understand is the company wants the restriction of a labour hire company. They want to use a labour hire company.

PN89

And item 1 in that same document says that the mass meeting rejects that proposal, is that correct?---Mr Regan’s proposal, yes.

PN90

Yes. Now Mr Wallace, I might hand up this document?---Because as I said, if the workers just answered ..... on it because the reason why we rejected it, and I said it to the workers, because I can’t talk about it.

PN91

Commissioner, if I just have that marked as an MFI?

MFI #6 MEMORANDUM OF UNDERSTANDING

PN92

MR SCHMITKE: Mr Wallace, is that a copy of the MOU that you have provided to the company?---I did not provide this to the company. Michelle Burgess did because she’s the organiser there and she come out to me at that meeting that day and Ms Burgess gave it to the company. Because I was only looking after the shop on a stand-in position.

PN93

Thank you. But it’s right to say that the company had been discussing the MOU and the agreement and this is the MOU that’s been put to the company?---No, that’s not right at all. The company at the first meeting said they wouldn’t have a problem with an MOU. We gave them a copy and after 11 December there was no more discussions on an MOU at any of the six meetings. There have been no more discussions on an MOU.

PN94

I see. Now Mr Wallace, if you can just turnover to the third page of that document, just for identification purposes. There’s a number up the top right-hand corner, page 10. Is that right?---Yes, that's right.

**** GEOFFREY KEITH WALLACE XXN MR SCHMITKE
PN95

And you’ll see there there’s a title in the second paragraph which is The Current Agreement and it says that:

PN96

The parties agree the following clauses of the current agreement will continue to apply to the proposed agreement as they were provisions in the proposed agreement.

PN97

Do you see that?---Where abouts are we again?

PN98

Underneath The Current Agreement, the first paragraph?---Yes.

PN99

Now Mr Wallace, can you explain to me what your understanding is of the intention of that particular sentence?---Once again I’d have to say I didn’t draw up this document so you’d have to ask Ms Burgess because she is the author of this document.

PN100

Right. But this was, you agree though, this refers to a proposed agreement?---A proposed agreement? In what way, an MOU?

PN101

Yes. Well, that this document being the MOU refers to a proposed agreement?
---For the MOU, yes.

PN102

So your understanding of the phrase “proposed agreement” does not mean proposed workplace agreement?---My understanding is this was a document given to Joe to take away to have a look at and he still hasn’t responded. So this was a document that, this was where the prohibited stuff was going to go is my understanding.

PN103

I see?---Because I can’t talk about it for the EBA, as you well know.

PN104

But it is your understanding as you just indicated that this document would contain all of the matters that would ordinarily be considered prohibited content?
---If Mr Regan agreed to it.

PN105

Right. Now, is it your understanding though that Mr Regan does not agree to it, that this particular document won’t be pursued?---My understanding if Mr Regan doesn’t agree to it, well then it’s all over red rover. Forget about it.

PN106

And in relation to MFI5 which is again referring to 1(d), I am right to say that the employees have rejected Mr Regan or the company’s proposal to remove restrictions on labour hire?---No, they have not at all. What they have indicated to me is I’m not to talk about it because I explained to them it’s a prohibited matter. That’s why we disagreed it because I can’t talk about it for the EBA.

**** GEOFFREY KEITH WALLACE XXN MR SCHMITKE
PN107

Now Mr Wallace, in this matter this document does say the mass meeting rejects Big Sister proposals?---Because when I do a mass meeting the company gave me a list of claims, as you can see from the document. The company also gave the delegates and every worker out there a list of claims of what they wanted back in February this year. They didn’t give it to me, they gave it to the workers. He knows ..... wants the removal of the labour hire clause and all that and as I said to people, I can not talk about that around the EBA. And that’s why we disagreed to it. Call it naiveness on my behalf, but we’re talking about 100 workers that don’t know the law, so I try to make it as simple as I could to them about it. That’s why I said to them we can’t talk about it, so we disagree about it.

PN108

So Mr Wallace, in the event that the company rejects the MOU and continues to negotiate with respect to the creation of the new workplace agreement, do you agree that the employees to whom the agreement is intended to apply have voted to reject the proposal that Big Sister has to remove the restrictions on the engagement or contract of labour hire?

PN109

MR NEILSON: I object to that question. That’s not something that Mr Wallace can answer. He’s being asked to give a view for 100 other people. It’s not something he can reasonable answer.

PN110

THE COMMISSIONER: If he’s not able to answer, he can answer that?---I can’t answer that because I can’t see what 100 workers are. What I’m doing is trying to educate them, what it means. So I don’t know what the outcome would be, my outcome. And I'll be honest with you, my outcome was the MOU would have got the thing, then I would have been saying to the workers the company has a legal obligation under the Work Choice laws to have whatever ..... use that team of casuals and labour hire mob.

PN111

MR SCHMITKE: Yes?---So it would have been, I would have told them the truth about that.

PN112

Yes?---And that wouldn’t have come an issue.

PN113

But as it currently stands, Mr Wallace, what we have is a resolution of a mass meeting from 14 March that rejects, says in writing that the employees have voted to reject the company’s endeavour - - - ?---That’s what it might seem on as paper here, but that’s not what it reflects in the mass meeting that I had, okay? I’m sorry. I mean, here I might not have put the 10 page sentence to it, but that’s not what it reflects at the mass meeting that I discussed, okay? Because it’s only a brief outline that I gave to the company. It wasn’t an outline of what actually happened in the meeting. Now, Mr Regan would have sat down at the last meeting after I gave him this resolution and listened to me instead of getting up and walking out, I would have went through the resolution with him and what it all meant. But he didn’t. He got up and walked out on me.

**** GEOFFREY KEITH WALLACE XXN MR SCHMITKE
PN114

But Mr Wallace, do you agree though that leaving aside the MOU the company is entitled to view this document as a rejection of its desire to remove what it would consider to be an item of prohibited content from the proposed agreement?---That may be, I don’t know how, that Mr Regan may have seen it, but once again if Mr Regan sat down and listened to what I was saying about it and went through the resolution with him instead of getting up and walking out after five minutes, then I might have gone through what it all meant. But Mr Regan got up and walked out. After I gave him the resolution he said that’s it, that’s fine, I’m not talking no more, walked out. Did not give me the opportunity to go through the resolution.

PN115

Just turn back to MFI6, Mr Wallace, which is the proposed MOU. Again going back to the third page of that section, that refers to the current agreement. Now, that sentence it says:

PN116

The parties agree that the following clauses of the current agreement will continue to apply to the proposed agreement as in they were provisions of the proposed agreement.

PN117

I put it to you that that sentence explicitly states that the proposed agreement is the proposed workplace agreement currently being negotiated. Do you agree with that?---No, I can’t see where you’re coming from. I’m not ......

PN118

The reference to proposed agreement in that sentence refers to proposed in the collective agreement. I put it to you that that is what it refers to. Do you agree with that?---No I don’t.

PN119

No you don’t? Thank you. I have no further questions, Commissioner.

PN120

THE COMMISSIONER: Could I just get it clear then from you, Mr Wallace. Your position is organiser, is it?---That's right.

PN121

Okay. And when you look at paragraph 9 of your statement, am I right in hearing that you said there was a further meeting then on the 14th?---Yes. That date’s not in there, Commissioner, I’m sorry.

PN122

And paragraph 10, are some words missing there:

PN123

The employer has offered a not offered a -

**** GEOFFREY KEITH WALLACE XXN MR SCHMITKE
PN124

How should it - - - ?---He has not offered a wage increase at all at this stage.

PN125

So if we omitted the words “has offered a”, you’re meaning to say the employer has not offered a wage increase?---Yes, has not offered a wage increase in the eight meetings I’ve had with him, Commissioner. The only thing is I’ve spoken about is the company is coming back to me with a lot of claims, they want a removal of the income protection, they want a removal of the tea money, they want the removal of the flower money they take and thing, and Mr Regan has indicated to me unless I’m prepared to move off that, he’s not prepared to talk about any other issues on the table.

PN126

And was I correct in hearing you say that this MFI6 was a document prepared by someone, another official of the union, which you gave to Mr Riordan at the meeting on 11 December, is that correct?---I didn’t give it to him, Ms Burgess did. What happened, Commissioner, so there’s no misunderstanding, I normally work in the metals division, I was asked to go over to the food division for six months because one of the organisers had some sickness and I was just taking up so I was only to fill in organiser for the food division at that time.

PN127

So this was given by Ms Burgess to Mr Riordan at the meeting?---With me, yes. Because Ms Burgess came out with me for the first two meetings because I didn’t know the site and I heard a little bit about Mr Regan’s reputation, so Ms Burgess came out with me.

PN128

Any questions as a result of that?

PN129

MR NEILSON: No.

PN130

MR SCHMITKE: No, Commissioner.

PN131

THE COMMISSIONER: You’re excused, thank you very much?---Thanks very much.

<THE WITNESS WITHDREW [12.26PM]

PN132

MR NEILSON: Thank you, Commissioner, that then completes the union’s evidence with respect to the matter.

PN133

THE COMMISSIONER: Will we hear your evidence now and then go submission, submission?

PN134

MR SCHMITKE: Yes, Commissioner. As I’ve indicated I might just seek a brief five minute period with our member.

PN135

THE COMMISSIONER: Certainly. Well, we’ll give you 10 minutes. I'll be back at 20 to one.

<SHORT ADJOURNMENT [12.27PM]
<RESUMED [12.42PM]

PN136

THE COMMISSIONER: Yes, Mr Schmitke, I think you're calling witnesses.

PN137

MR SCHMITKE: Yes, if I could please call Mr Regan.

<JOSEPH REGAN, SWORN [12.42PM]
<EXAMINATION-IN-CHIEF BY MR SCHMITKE

PN138

MR SCHMITKE: Mr Regan, just for the benefit of the record can you please just state your full name and occupation, please?---Yes, Joseph Regan, (address supplied), and I'm general manager of Big Sister Foods.

PN139

Thank you. Mr Regan, you understand that the purpose of today is a hearing for the union and employees at your site seeking to take protected industrial action, do you understand that?---Yes, I do.

PN140

Now, Mr Regan, have you been the person who's been negotiating with the union and employees up until this point?---Yes, I have been.

PN141

Now, Mr Regan, you would be aware that the legislation in the Workplace Relations Act makes it a requirement that employees are genuinely trying to bargain or have been genuinely trying to bargain with your company, are you aware of that?---Yes, I am.

PN142

Mr Regan, is it your view or do you believe that as a result of your involvement in the negotiations that the union and/or the employees have been genuinely been trying to bargain with you?---No, I don't. I don't believe that.

PN143

Can you explain to me and the Commission the reasons for that?---Certainly. We've since late November, early December, we've been discussing with the union and the site employees the renewal of the current EBA and I put forward a number of items that I would like the employees and the union to in fact consider and the status that we've always had is in fact that whatever pay rise that we were to agree to we need to at least somewhere along the line pay for some of that by some of the items that I listed on those various lists. Now, in fact as time's gone on I have modified those lists and modified our position but in fact on all occasions the position is that none of those situations have been accepted by the union or in fact employees. So I'm used to a negotiation where I put forward some position and someone comes up with an alternative position. In fact the situation had been that despite me modifying my proposals, on all occasions they've been rejected.

**** JOSEPH REGAN XN MR SCHMITKE
PN144

And Mr Regan, how would you describe the existing conditions within the existing agreement?---Very good in my opinion. Very good and if in fact within the food industry, and bear in mind that we are now a small company, they are extremely good and I can quantify that by saying we give the employees 24 RDOs a year, 33 and a third per cent on their holiday loading, as a holiday loading. We pay well above the award in terms of wages, two picnic days a year. The list goes on and on and on.

PN145

Now, Mr Regan, is it the case that the proposals you've put to the union in your view have been rejected, is that the case?---Yes.

PN146

Now, Mr Regan, I've given you two documents which have already been marked as MFI1 - sorry, MFI5 and MFI6. If I can take you to MFI6 which is the draft proposed memorandum of understanding. Mr Regan, can you explain to the Commission what your understanding of this document is?---Yes, in the very early stages of negotiation with the union be it the first or second meeting, the union raised the issue of a memorandum of understanding in which they would list a number of conditions that were prohibited from being listed in the enterprise agreement and I asked in fact for them to provide me with a document that they would be proposing and hence this document was forwarded to me. In my view it goes hand in hand with the agreement that in fact we have an agreement on one side and on the other where in its background we have this memorandum of understanding.

PN147

Thank you, Mr Regan. I've also handed to you a document that's now been marked as MFI5 which is the resolutions of the mass meeting on the 14th of the 3rd. Can I ask you, Mr Regan, to explain to the Commission what your understanding or the company's understanding is of this document?---Yes, this is a result of I guess our final - sorry, it's the result of discussions that the union had in fact with the site employees discussing a variety of sort of issues that the company had raised and where the company was in fact asking for some modification or some giving up of these conditions. The intent being that that would possibly pay for whatever pay rise we would consider and in fact the meeting rejected outright all of the company's proposals, every single one of them.

PN148

Mr Regan, is it your understanding that the meeting that took place on this day was in relation to gaining employees views about the negotiation of a new collective agreement?---Yes, correct.

**** JOSEPH REGAN XN MR SCHMITKE
PN149

And am I right to say then that this document in your view represented a rejection of claims that you had advanced as part of that agreement making process?---Yes, correct.

PN150

Now, to what extent in your understanding, Mr Regan, does the draft memorandum of understanding and the current negotiations to the agreement, to what extent do they interact?---I think they're part and parcel of the same thing. There's no question in my mind that both the union wants a site agreement and also wants a memorandum of understanding, and in fact in some of my notes that I've put forward, be it to the union or the site employees, I list some items in fact that we agreed to, one of them being memorandum of understanding. Sorry, the company's position has been on the memorandum of understanding that we would always - we wanted an agreement and then we would entertain this memorandum of understanding.

PN151

So Mr Regan, is it your view that if the company rejected the memorandum of understanding then we are back to this document where the employees reject your proposal to remove a restriction on labour hire?---Yes.

PN152

And you are aware or have been made aware that clauses in workplace agreements that restrict the engagement of labour hire companies would be prohibited content?---Correct, yes.

PN153

THE COMMISSIONER: Sorry, Mr Schmitke, did you say the company or did you say the union that rejects the MOU? I think you might have said the company, is that what you meant, yes?

PN154

MR SCHMITKE: The company rejects the MOU.

PN155

THE COMMISSIONER: Yes.

PN156

MR SCHMITKE: Yes, I did.

PN157

THE COMMISSIONER: Thank you.

PN158

MR SCHMITKE: Now, Mr Regan -actually I have no further questions, Commissioner.

PN159

THE COMMISSIONER: Yes, Mr Neilson.

**** JOSEPH REGAN XN MR SCHMITKE
PN160

MR NEILSON: Thank you, Commissioner.

<CROSS-EXAMINATION BY MR NEILSON [12.51PM]

PN161

MR NEILSON: I'm correct, Mr Regan, in my understanding that you've conducted the negotiations for the proposed agreement on your own on behalf of the company?---Yes.

PN162

Is that correct?---Yes, it is.

PN163

And am I correct also in my understanding that Mr Wallace has conducted negotiations on behalf of the union?---Yes, that's true.

PN164

And sometimes Ms Burgess has attended those negotiations?---Yes.

PN165

And union delegates have attended those negotiations?---On all occasions.

PN166

Yes. And you accept that those union delegates are representative of the employees?---Yes.

PN167

And you accept that those union delegates and Mr Wallace communicate the discussions about the proposed agreement to the wider employee group?---Yes, although I've never been present during that, but yes, my understanding would be that and I would expect nothing less.

PN168

And on occasion the company has facilitated meetings for that communication to occur?---Certainly.

PN169

Yes. And you accept on the basis of what you know that the claims that have been advanced to the company have been endorsed by the employees?---I accept that, yes.

PN170

And you accept that there have been a number of meetings in relation to the proposed EBA?---Absolutely.

PN171

And in those meetings there has been discussion about various clauses that could be inserted into the proposed EBA?---No, I won't accept but I would, if I
could - - -

PN172

Yes?---The company's put forward a number of modifications to the current EBA, current agreement, but in fact I'm not aware of any inclusions.

**** JOSEPH REGAN XXN MR NEILSON
PN173

But there have been discussions about the content and the make up of the proposed EBA?---Yes, that's correct.

PN174

And the company has put forward a view about a number of clauses that it wishes would be included in any future agreement?---It's put forward a number of clauses that it would like modified.

PN175

Yes. And the union has given a view in relation to whether it accepts or rejects those clauses?---That is true.

PN176

And the union has put a number of proposals to the company in relation to what it would like in the proposed agreement?---No, I wouldn't suggest that. I wouldn't accept that. What I would suggest in fact is the union are wanting to retain what's currently in the agreement rather than put forward alternatives.

PN177

Yes. And that's a claim that the union has advanced to you, that it's something that they would like to be maintained in the agreement, that's correct, isn't it?
---Yes, that's correct.

PN178

And one of those claims that has been discussed relates to a wage increase?
---Wages have not been discussed.

PN179

So the union has never put to you that it wants a 6 per cent wage increase over the life of the agreement?---I didn't say that. What I said was in the various meetings that we've had, wages have never been discussed. I in fact have raised it, in fact asking for some wages to be discussed and in fact the comments back have been that's down the track or that's - as I say, no wages discussions have been taking place in the actual meetings.

PN180

Yes. But are you aware of the claim advanced by the union that they would like a 6 per cent wage increase?---Yes, I'm aware of that.

PN181

Yes, thank you. And are you aware that there seems to be some dispute about improvements to redundancy clauses?---This is something that I raised.

PN182

Yes?---I pointed out within the current agreement, within the current agreement. Initially the company was asking for a cap on redundancy and I raised within the current agreement that in fact the current wording in my interpretation indicates a cap already. So I'm not aware of any improvements in redundancy.

**** JOSEPH REGAN XXN MR NEILSON
PN183

Yes. But you accept that there has been some discussion and debate about the make up of a future redundancy clause. That's correct, isn't it?---No, I won't agree to that. What I would say is it's been raised but I do not believe that it's been discussed in any detail whatsoever. It's been raised, certainly.

PN184

And can I just check a number of dates in which there have been meetings about the proposed agreement and I'm going off your memory and you can clarify if you're not sure, there's been a meeting on 22 November 2007?---Look, you're going to quote to me half a dozen dates. Really I can't confirm every individual one but certainly if I can refer to my notes I can.

PN185

Would you accept it as broadly being true that there have been approximately six meetings?---No - yes.

PN186

And you would accept that there has been a view put forward by the company that has been - or hasn't been accepted by the union in relation to the proposed agreement?---That view being?

PN187

Well, Mr Regan, a negotiation occurs and I don't wish to tell you how a negotiation occurs, but the company has put up a proposal in relation to the proposed agreement, do you accept that?---We put up a number of clauses that we would like the union and the employees to consider change with the whole purpose being to try and pay for the pay rise.

PN188

Yes?---Somewhere or other we need some modification to pay for whatever pay rise may be considered.

PN189

Yes. And you accept that proposal put forward by the company hasn't been accepted by the union?---Yes.

PN190

And you accept that the employees and the union are entitled to reject your proposal?---Absolutely.

PN191

And you also accept that the company is entitled to reject any proposal that the union may wish to make?---Absolutely.

PN192

And that's part of negotiation, isn't it?---No question.

PN193

And there's no requirement, is there, for either party to actually agree on something, is there?---No.

**** JOSEPH REGAN XXN MR NEILSON
PN194

Thank you. Now, if I'm correct in recalling, the answer you gave to my friend earlier was that the issue of an MOU was raised in the first or second meeting that you had?---Correct.

PN195

And you indicated that the company had no objection to the formation of an MOU, is that correct?---That is correct.

PN196

Yes. And there has been nothing put to you, has there, that in order for the union to agree to the proposed EBA the company must agree to the proposed MOU?
---No, I wouldn't agree with that.

PN197

You wouldn't agree with that. And can you recite a specific conversation and date at which that comment that you wouldn't agree with has been made?---I can't recite word for word, no.

PN198

Yes. There has been some debate about the issue of the use of labour hire companies, are you aware of that?---Yes, I am.

PN199

And the company has within its current agreement a clause that restricts the use of labour hire companies, is that correct?---That's correct.

PN200

And the company wishes to remove that restriction?---That is correct.

PN201

And the company is aware that the prohibited content rules now make it impossible to have a restriction of a similar sort in a new agreement?---Correct.

PN202

And why would the company then put a view - why would the company then seek the employees approval to remove something that is not legally possible to include?---Because it's our understanding clearly from the memorandum of understanding that's been supplied to us from the union that in fact they wish to include that in that document.

PN203

Yes. But the memorandum of understanding is not to be included in the proposed agreement, is it?---Correct.

PN204

So they're completely separate documents, aren't they?---Completely separate.

PN205

And the company agreed that in principle with a memorandum of understanding, that's correct?---Correct.

**** JOSEPH REGAN XXN MR NEILSON
PN206

Yes, thank you. So the company knows that the MOU and the proposed EBA are not linked in any way?---No, no, I wouldn't say that. They may not be linked in any legal sense but they certainly are linked in terms of negotiations because the union, that is what they are asking for as part of the negotiations, that in fact we have a memorandum of understanding separate to the enterprise agreement.

PN207

Yes. And the company has accepted that proposal. That's correct, isn't it?---Yes.

PN208

So there's no issue about the MOU?---But we're not saying they're not linked.

PN209

No, my question is there is no issue about the MOU. The union and the company agreed?---What the company agreed to was in fact that we would entertain the MOU, right, based on once the agreement was struck.

PN210

Yes. And can I show you a letter, which is MFI4, Commissioner. Do you recall receiving a copy of this letter?---Yes.

PN211

You'll see at point 2:

PN212

MOU, union agrees.

PN213

?---Yes.

PN214

Was that in response to the best of your knowledge, a proposal that the company had put in relation to the MOU?---No, it was the other way round I would suggest.

PN215

So that the union - well, to the best of your knowledge based on your understanding of the negotiations, what is meant by union agrees to the MOU there?---Well, in fact the MOU has been put forward by the union and I don't quite understand why the union is agreeing with what they've put forward. I mean they're stating in fact that they want an MOU there. That's all in my view.

PN216

Okay, thank you. No further questions.

PN217

THE COMMISSIONER: What you said, Mr Regan, was that it seemed to be saying that there's all these series of meetings but apart from the draft MOU that was given to you at an early meeting all of the proposals, all the specifics of proposals have been coming from your side of the table?---That is correct, sir, yes.

**** JOSEPH REGAN XXN MR NEILSON
PN218

And when did you start putting those forward?---From - I can't recall the exact date but it would have been certainly prior to Christmas so in December some time. The intent being that I listed a number of items which are currently in the current EBA and I was looking for somewhere, some items to be conceded and basically even though at various stages I've modified the list and modified some of the proposals I've put forward basically I've had no acceptance of any of the items I put forward whatsoever.

PN219

I just wanted to clarify that. Please proceed.

<RE-EXAMINATION BY MR SCHMITKE [1.03PM]

PN220

MR SCHMITKE: Mr Regan, just for abundant clarity, can I confirm that all of the proposals that are coming and put to the employees with respect to the workplace agreement negotiations have been rejected, is that correct?---Yes, it is.

PN221

And those proposals included removing restrictions on labour hire companies?
---That is correct.

PN222

And that is a proposal that as you understand it was rejected at this meeting on
14 March?---Yes, correct.

PN223

And so by that, Mr Regan, do you understand then that by not having that particular restriction in the agreement because it's prohibited content it has to go somewhere else, doesn't it?---Yes, it does.

PN224

And where would go in this instance?---In the MOU.

PN225

And therefore do you agree or is it your view or the company's view that the MOU and the negotiations of the agreement are linked?---Yes, they are.

PN226

Thanks. I have no further questions, Commissioner.

PN227

THE COMMISSIONER: Thank you. Nothing further from me. You're excused, thank you, Mr Regan. Mr Regan, does the company who has the employees as - all of the employees are 44 - - - ?---44A Wharf Road, Lavington, yes.

PN228

That's where Big Sister Foods operates, is it?---That's correct, that's where we operate.

**** JOSEPH REGAN RXN MR SCHMITKE
PN229

Thank you very much. You're excused, thank you.

<THE WITNESS WITHDREW [1.05PM]

PN230

THE COMMISSIONER: Yes, Mr Neilson.

PN231

MR NEILSON: Thank you, Commissioner. The requirements of the Act with respect to the matters that the Commission must take into account in deciding whether or not to grant a ballot order are set out in section 461. With respect, we respectfully submit and I don't think it's challenged by my friend that the statutory prerequisites to applying for an order have been satisfied. That is, those requirements set out in section 451, 452, 453 and 454. Those are procedural matters that have been, we say, satisfied by the terms of the application that has been filed. The challenge as we anticipated that is coming from the representative of the employer relates to section 461 and in particular section 461(a) and (b).

PN232

There is no suggestion and it certainly has not been put in cross-examination by my friend and/or evidence that the union has been engaged in pattern bargaining and I don't propose to address any submissions at length in relation to that point. The requirement for the Commission to be satisfied that during a bargaining period that the applicant had genuinely tried to reach agreement with the employer and that we are continuing to reach agreement with the employer are requirements that the Commission must be satisfied of prior to implementing - prior to ordering a ballot order. MFI2 in these proceedings we say is prima facie evidence of the initiation of a bargaining period. That bargaining period was initiated on or around 23 November 2007.

PN233

That, we say, would satisfy the Commission that in fact there has been a bargaining period initiated and satisfies the first step of section 461(1)(a). The second step that the Commission must take into account is during that bargaining period the union, the AMWU, has in fact attempted to meet or genuinely reach agreement with the employer. The statement of Mr Wallace which has been filed in these proceedings and is exhibit M1 at paragraph 9 sets out a number of meetings that have occurred between the union through Mr Wallace and on occasion Ms Burgess and Mr Regan who has appeared on behalf of the employer, Big Sister Foods in the negotiations. There have been a number of meetings that Mr Wallace deposes to and were not challenged in cross-examination during the bargaining period on 11 December 2007, 17 December 2007, 30 January 2008, 4 February 2008, 13 February 2008, 27 February 2008, 6 March 2008 and also a further meeting beyond that Mr Wallace articulated in response to a question from the Commission.

PN234

THE COMMISSIONER: It sounded like a short meeting.

PN235

MR NEILSON: Yes. There can be, we respectfully submit, no submission properly put by the respondent that there has not been at least an attempt to meet and discuss a number of the issues that have been the subject of the proposed EBA. The main complaint that we understand from the evidence of Mr Regan is that the employer is seeking to obtain from the union and its employees a number of concessions in relation to the proposed agreement. Mr Regan forms the opinion that as a result of the union not making those concessions it has not been genuinely bargaining.

PN236

With respect to Mr Regan, we submit that and in fact he accepted in cross-examination, that neither party is required to agree to either side's particular claims.

PN237

THE COMMISSIONER: So what do you say, it's just hard bargaining? There's been 1, 2, 3, 4, 5, 6, 7, 8, 9, nine meetings with no concessions so that's pretty hard bargaining.

PN238

MR NEILSON: Well, Commissioner, it's not necessarily a case that there has been absolutely no concessions in those meetings but - - -

PN239

THE COMMISSIONER: I think the evidence was that.

PN240

MR NEILSON: But with respect, Commissioner, there is no requirement to make concessions.

PN241

THE COMMISSIONER: No, I understand. So you're putting to me that there's been very hard bargaining going on.

PN242

MR NEILSON: Yes, yes.

PN243

THE COMMISSIONER: Yes.

PN244

MR NEILSON: And there are a number of reasons for that and a number of cases of this Commission have in fact dealt with that and I'll hand up to the Commission two cases that deal with concessions in bargaining. The first decision is a decision of Vice President Lawler on 14 February 2007 between the LHMU v CSBP Ltd (2007) AIRC 112. The relevant commentary from his Honour in those proceedings is set out at paragraph 38 of that decision and his Honour states that:

PN245

Secondly, the notion of genuinely trying to reach agreement does not automatically imply continual movement in the same direction ...(reads)... and still be genuinely trying to reach agreement.

PN246

Now, his Honour deals with their position in that particular case where a party had put an offer on the table and then withdrawn and then got reverted back to its previous position. The other point, and it's been well accepted by the Commission in relation to hard bargaining as the Commissioner referred to it, was elucidated by Commissioner Eames in the second decision which is AFMEPKIU v Visypak Operations where we would submit that the Commissioner accepted the reasoning of Marshall J in the G & K O'Connor case where talking about the requirement to bargain in good faith which the Commission has accepted is in part equivalent or relevant to a consideration of genuinely trying to reach agreement that -

PN247

Bargaining in good faith does not require a willingness to make concessions. It is consistent with adopting a hard line. Equally it does not imply moderation of demands.

PN248

And the quotation continues. We say that it was properly accepted by Mr Regan in evidence that the company is not required to accept claims of the union at any particular time and, in fact, it hasn't, and it's more than entitled to do that. But equally, the union is also entitled to reject whatever claims that the company may wish to put forward in relation to its negotiations. So therefore we say that simply, as the Commission referred to, that hard bargaining does not give rise to an implication or a finding by the Commission that there had been no attempt to genuinely reach agreement.

PN249

The second point that we anticipate that the respondent will come to with respect to demonstrating that the union has not genuinely tried to reach agreement relates to the existence or otherwise of a proposed MOU dealing with a number of matters that are now deemed by legislation to be prohibited content. The Commission would be well familiar with such arrangements given that they seem to arise on a number of occasions, and there are various decisions of the Commission which deal with the issue of a deed and its relationship to negotiations and bargaining.

PN250

I don't propose to take the Commission to it, but can I just hand up for the assistance of the Commission again a decision of Commissioner Simmonds, who cites an earlier decision of Vice President Lawler.

PN251

THE COMMISSIONER: Which paragraph?

PN252

MR NEILSON: If you turn, Commissioner, to paragraph 23, the Commissioner sets out a decision of Vice President Lawler in CFMEU v Ulan Coal Mines Limited, and there are a number of points there that his Honour touched upon in dealing with determining the test of genuinely trying to bargain. You will see at the last point which is on page 7 of 19 of the decision it says that:

PN253

While the mere fact that a union contemporaneously makes claims for a site agreement containing prohibited content and makes other claims for ...(reads)... in a separate common law site agreement.

PN254

Now, with respect to that, Commissioner, the only evidence - and we say it was not seriously challenged by my friend - is that of Mr Wallace on this question. Mr Wallace was asked on a number of occasions whether or not the negotiation of an enterprise agreement was contingent upon the acceptance by the employer of a memorandum of understanding. Now, Mr Regan conveniently, we say, in his evidence suggested that that indeed was the case.

PN255

There are a number of things that counter against the Commission, in our view, accepting the evidence of Mr Regan on this point. Those are the evidence of Mr Wallace which was clear an explicit, that the two are not linked and the two were not linked at the time of discussing the MOU, and the two are not linked at the time of applying for this application. The evidence of Mr Regan that the company had in fact accepted that an MOU in fact was appropriate, albeit it's terms were not necessarily acceptable to the company, the evidence of Mr Regan that the MOU was discussed in the first two meetings - and if my understanding of it is correct, has not necessarily been discussed since those first two meeting, the evidence of Mr Regan that the MOU was prepared at his request for consideration by the company of what an MOU may look like, and the evidence of Mr Wallace that they have not heard a response nor necessarily sought a response from the company in relation to the MOU since it was provided at the second meeting, which was December 2007.

PN256

There has been no suggestion we submit with respect to the proposed MOU and no valid suggestion at least that the union is only seeking a protected action ballot in order to advance its claims with respect to the proposed prohibited content items that may be dealt with in the MOU. A number of parties have, over the time of the introduction of WorkChoices and prohibited content regulations, dealt with those items deemed prohibited through an MOU, and that has been dealt with by this Commission on a number of occasions. There mere existence of discussions in relation to it does not, we say, automatically lead to a finding that the parties have not been genuinely negotiating.

PN257

The last point that I suspect that my friend will raise is that the union has resisted the removal of the clause dealing with labour hire arrangements. The Commission would be aware from the evidence of Mr Regan in cross-examination that the current Big Sister EBA contains a provision relating to the restriction of those labour hire arrangements. Prior to the introduction of WorkChoices those restrictions were perfectly legal.

PN258

And as parties and their agreements expired and they entered the new bargaining round a number of parties have had to deal with what to do with those particular clauses. Some have entered into MOUs and some haven't. It is entirely reasonable for the parties to have some discussions in relation to what should happen with clauses that are contained within current agreements but, as Mr Wallace said, he is in a difficult position in having those discussions on the basis that it may be inferred that he is seeking to make a claim with respect to those prohibited content items.

PN259

His evidence on this point was clear and unambiguous and not necessary challenged, we would submit, by the evidence of Mr Regan, that the union is not and has never been pursuing a claim for the inclusion of a labour hire clause in the proposed enterprise agreement. That we submit is the only evidence that is before the Commission which should satisfy the Commission that the requirement not to pursue prohibited content has occurred and the requirement to genuinely try and reach agreement with the employer has also occurred.

PN260

With respect to the evidence of Mr Regan, the main complaint seems to be that there, as I've said before, have not been any concessions, and his evidence is at best based on his opinion about the way he sees the negotiations going. That, we say, is not enough for the Commission to make a positive finding that the parties have not been genuinely negotiating in relation to the proposal to make a new agreement. The Commission must be satisfied of something more in order to form a view that the requirements as to section 461(a) and (b) have not been met.

PN261

The only evidence and the only real and firm evidence that is available to the Commission was, we say, submitted by Mr Wallace in relation to how he has made a claim and dealt with it by the employer, and we would submit that the evidence and opinion of Mr Regan, whilst relevant and important to him, is not necessarily of assistance to the Commission in determining the section 461(1)(a) requirements.

PN262

Can I also say in relation to - I suspect that there may be some submission made in relation to whether or not the union has put on the table some claims in relation to how it would see the agreement being formed throughout the negotiations. Paragraph 11 - - -

PN263

THE COMMISSIONER: Sorry, say that again.

PN264

MR NEILSON: Yes, sorry. I suspect that there may be a submission put that the union has not put on the table what it is seeking from the proposed agreement, that is, that it has only rejected what the employer has put up and has not put on the table anything that it wishes for inclusion in the agreement. Paragraph 11 of Mr Wallace's statement, again, which is exhibit M1 in the proceedings, was not challenged by Mr Schmitke in his cross-examination of Mr Wallace. Mr Wallace sets out that the union is seeking, amongst other things, a six per cent wage increase over a three year agreement, improvements to the redundancy and the maintenance of existing terms and conditions with the exception of any prohibited content. None of those paragraphs were challenged by Mr Schmitke, and as such we would submit that the evidence of Mr Wallace on that point has to be accepted by the Commission.

PN265

That of itself would demonstrate a prima facie position to the Commission that the claims of the union have indeed been put and, as the employer is entitled to do, it has rejected those claims and put an alternative position. That is part of any bargaining arrangement and envisages an attempt by the parties to genuinely reach agreement. Paragraph 10 also of Mr Wallace's statement, subject to the correction as identified by the Commission for which we apologise, Mr Wallace indicated that the employer has not offered a wage increase at all. That is his evidence. It was not challenged by my friend with respect to his cross-examination of Mr Wallace and, again, the evidence therefore would establish of Mr Wallace that the union has put forward what it sees as being a fair and reasonable wage increase, and the employer has not put forward anything in reply to that increase.

PN266

The last point that I'd seek to make, Commissioner, is that it is clear from the evidence, and Mr Regan rightly accepted, that the negotiations have at all times been conducted by the union in the accompaniment of union delegates. Those union delegates have been elected by employees who are union members at the site, and on occasion the employer has facilitated report back meetings to those employees to discuss the agreement and the negotiations in relation to it.

PN267

What that again envisages, or evinces, sorry, is that the union has taken the position put forward by the company, it has communicated that position back to the employees, and those employees have given a response in relation to it, and that response has been communicated back to the company. MFI5 indicates that position. There may be some submission put in relation to point D of MFI5, and that is the restriction of labour hire companies and the wording of Mr Wallace that the mass meeting rejects the Big Sister proposals.

PN268

Mr Wallace's evidence in relation to that point was clear and unambiguous, that as the matter was prohibited content there was no point in actually discussing it as part of the EBA. It needs to be kept in mind also, Commissioner, that a number of employees, in fact probably all of the employees, would not have the knowledge in relation to what is and what is not prohibited. That is a challenge that is faced by the parties or any bargaining party on an everyday basis in trying to deal with matters that are prohibited and trying to ensure that they do not form part of the negotiations.

PN269

The wording of Mr Wallace's memorandum to Big Sister about the restriction of labour hire companies and its rejection is neither here nor there. It doesn't matter whether the company wishes to maintain a clause and whether or not it wishes to remove that clause. The fact is the law says it cannot be there. And Mr Wallace gave evidence that he's clear on what the law says in relation to that, he understands that it cannot be there and he doesn't pursue it. That should be enough to satisfy the Commission that it's not forming part of the union's claim with respect to this matter. Unless the Commission has any questions those are our submissions.

PN270

THE COMMISSIONER: Just one decision I note. If your application is granted, have there been discussions between the parties as to what hours the ballot would be open each day for voting?

PN271

MR NEILSON: Unfortunately there hasn't been. I was trying to get those instructions this morning but I couldn't get them, but I do apologise for that. But the parties are here.

PN272

THE COMMISSIONER: I think it's fair to say - perhaps I'll just wait. I'll come back to it.

PN273

MR NEILSON: Thank you, Commissioner.

PN274

THE COMMISSIONER: Yes, Mr Schmitke?

PN275

MR SCHMITKE: Thank you, Commissioner. As has been indicated, Commissioner, the Australian Industry Group is instructed to oppose this application. The basis of that opposition is that the application we say does not meet the requirements of section 461 of the Act. That section of the Act requires the Commission to be satisfied that the applicants who seek ballot orders have genuinely tried to reach agreement with the employer or are genuinely trying to reach agreement with the employer.

PN276

Now, we say that that's not the case for two reasons that I will shortly outline, and we advance that proposition notwithstanding the section 453(4) declaration that has been made by the union to the effect that they are not seeking to organise industrial action in pursuit of prohibited content. The company submits of course that that is not the case, and in fact the opposite is the case.

PN277

Commissioner, the document that's been the subject of discussion today marked up as MFI6 is a site agreement. And we say that that site agreement is currently being pursued, we say that it contains items that would ordinarily be prohibited content if it were to form part of a workplace agreement. There's no debate that those items would be considered prohibited content pursuant to Regulation 8.5, and we say in relation to that that it is either being pursued as part of the negotiation process for the agreement and/or that the negotiation for the agreement is contingent upon or linked in in some way to the making of the memorandum of understanding.

PN278

Now, in that respect, Commissioner, the memorandum of understanding at page 3 under that section of the current agreement makes reference and we say is evidence that there is a link between the proposed agreement which is the subject of the negotiations and the memorandum of understanding. The memorandum of understanding says:

PN279

The parties agree that the following clauses of the current agreement -

PN280

Being the agreement that has expired and is being renegotiated:

PN281

- will continue to apply to the proposed agreement as in they were provisions of the proposed agreement.

PN282

Now, I would assume that that should be as if they were provisions of the proposed agreement. Aside from that it is very clear on that that this document is contingent upon and it is linked to this document and the making of a new agreement. And that wording in our view is evidence of that. Now, in the event that the Commission does not find that that is the case or does not agree with us on that submission, then we would also say that there is evidence that the union and the employees have voted to pursue a claim for an agreement which includes prohibited content. And for that of course I refer to the document that's marked MFI5.

PN283

Now, that document being the resolutions of the meetings on 14 March clearly records that the mass meeting rejected Big Sister's proposals. And Big Sister's proposals were, one of them was item D, the restriction of labour hire companies. So quite simply, Commissioner, if the employees have rejected the company's proposal to remove that restriction within the agreement that they wish to advance, if employees reject that then it has to go somewhere. Where is it going to go? It's going to go into the memorandum of understanding. So that there's a clear link between the rejection and the memorandum of understanding on the basis of the resolutions of this mass meeting on the 14th of the 3rd. And of course in addition to that this document records that if the talks fail then the union is to lodge an agreement with this Commission for a protected action ballot.

PN284

So it confirms that they are in fact seeking to take protected action in support of a position which includes rejecting the company's proposal to remove an item which is clearly prohibited content in accordance with Regulation 8.5 of the Regulations. And a third point that I wish to raise, Commissioner, is the concept of the parties genuinely trying to bargain. Now, it's our view that in considering what the Commission should consider to determine what is a party that is genuinely trying to bargain the Commission should have and ought have regard to the concept of reasonableness with respect to bargaining.

PN285

And the evidence as we see it, the evidence from Mr Regan was that the proposals he's advanced have all been rejected by the employees. Now, we say that that rejection is not reasonable. We say that that should go some way to convincing the Commission that the employees are not genuinely trying to bargain because they are taking - - -

PN286

THE COMMISSIONER: Why isn't that reasonable? Why isn't it just hard bargaining?

PN287

MR SCHMITKE: Well, Commissioner, you were referred to - - -

PN288

THE COMMISSIONER: Or hard line, whatever was said.

PN289

MR SCHMITKE: Well, you were referred to a decision, Commissioner, which was I think a decision of Vice President Lawler which was LHMU Western Australian Branch v CSBP which dealt with the concept of genuinely trying to reach agreement.

PN290

THE COMMISSIONER: I think that one was more about prohibited content. I think it was the other one from Commissioner Eames in respect of Visy Pak where I was referred to the Federal Court decision about adopting a hard line. Is that what you mean?

PN291

MR SCHMITKE: No, Commissioner. I was referring to the CSBP, paragraph 38.

PN292

THE COMMISSIONER: Yes, paragraph 38.

PN293

MR SCHMITKE: A decision in that paragraph refers to genuinely trying to reach agreement, and his Honour observes that that does not automatically imply continual movement in the same direction by a negotiating party. Our submission is that there must be some movement, and some movement is not outright rejection.

PN294

THE COMMISSIONER: Just tell me which paragraph 38 you're talking about, sorry.

PN295

MR SCHMITKE: Yes, paragraph 38.

PN296

THE COMMISSIONER: Of?

PN297

MR SCHMITKE: Of the CSBP decision.

PN298

THE COMMISSIONER: I've got it, thank you. A bit disorganised I'm afraid, sorry about that.

PN299

MR SCHMITKE: It's a war on paper today, Commissioner. So that paragraph, Commissioner, referred to his Honour discussing the notion of genuinely trying to reach agreement, and he observes that it does not imply continual movement in the same direction. And our view on that is that genuinely trying to reach agreement implies at least some movement. And what we say is that the company has advanced a number of claims in its position and that those positions and those claims have been withdrawn - sorry, have been rejected, and as a result of that rejection those employees have now resolved to ask their union - - -

PN300

THE COMMISSIONER: What do you say to the submission, or the proposition that the union's advanced lots and the employer hasn't agreed to anything?

PN301

MR SCHMITKE: I think, well, the evidence of Mr Regan was that there has been no rejection of those particular matters, that there's been discussion relating to them and, in fact, as I recall, Mr Regan's evidence went to say that they had been mentioned but not discussed in any great detail. So I also understand that Mr Regan had indicated that he hadn't rejected any of the proposals put to them by the union and that he had then sought some trade off. That's how I understood his evidence.

PN302

So, Commissioner, I suppose in summary on that point reasonableness involves some type of movement, and we submit that reasonableness should be taken into consideration when the Commission seeks to determine if the parties have genuinely been trying to reach agreement. Commissioner, you were also referred to a decision of Commissioner Simmonds, and a number of observations made by his Honour, Vice President Lawler, arising from the CFMEU v Ulan Coal Mines matter.

PN303

And, Commissioner, you were taken to the last point in paragraph 23 of that decision, and it's interesting to observe that those circumstances are quite akin to this one, and I'll repeat that paragraph:

PN304

While the mere fact that a union can contemporaneously make claims for a site agreement containing prohibited content ...(reads)... provided it is clear on the evidence -

PN305

And I emphasise those words:

PN306

- providing it is clear on the evidence that there is no linkage ...(reads)... in a separate common law agreement.

PN307

Now, in relation to that, Commissioner, I would agree with those observations and submit that in this case the Commission must be satisfied that it is clear on the evidence that there is no linkage. We say that it is clear from the evidence of Mr Regan that there is a linkage between a proposed MOU and the negotiation of this agreement. And in the absence of the Commission being able to make that distinction and be certain that there is no linkage and clear that there is no linkage, then the Commission ought not make the order sought and dismiss the application.

PN308

In summary, Commissioner, we say that the Commission must not, under section 461, make the order sought unless it is satisfied that the requirements of that section have been met. We say that those requirements have not been met in that the union and the employees have not genuinely tried to bargain with the company. There is a linkage between the agreement and the proposed MOU such that concluding the workplace agreement or making a concession in relation to it is in fact linked to, conditional upon or related to a union claim for prohibited content in the proposed memorandum of understanding.

PN309

The simple facts are these, Commissioner. The employees have rejected and voted to reject the company's proposal to remove restrictions on labour hire companies, and they have then said in support of that vote, in support of that rejection, that they want this Commission to make orders to take protected action. If the Commission finds that the MOU is not linked then we do have a situation where the employees have voted to take protected action in support of something that is prohibited content.

PN310

Alternatively, if the intention is for that item of prohibited content to go into the memorandum of understanding then by default there is a clear linkage. That is the only way that it can be looked at, Commissioner. And as I again reiterate, the Commission must be satisfied that there is no linkage taking place, and in the absence of that we say that the Commission ought not make the order sought. Unless there's anything further they are our submissions.

PN311

THE COMMISSIONER: Thank you, Mr Schmitke. I think you've anticipated it all, Mr Neilson.

PN312

MR NEILSON: Can I just make one response? Can the Commission bear with me for one moment?

PN313

THE COMMISSIONER: Yes. I just need to say I've decided I think that I'm going to reserve my decision, but I need to know if I went in favour of the union and granted the application, I need to know what hours between which the ballot would take. The Australian Electoral Commission doesn't like to be out from 7 o'clock in the morning till 7 o'clock at night, so it's in their interest, and we try and cooperate I think, that it's specific times, whenever that might be. So I need to be advised by the parties on that.

PN314

MR NEILSON: Thank you, Commissioner. Mr Schmitke made much of the fact that MFI5 at point 4 talks about a proposal by, or an instruction, it would appear, by the employees that if the talks were unsuccessful that the union was to lodge an application such as this. What my friend fails to draw the Commission's attention to and, in fact, in our respectful submission it's a misunderstanding of MFI5, and that is point 2. The mass meeting instructs the AMWU to pursue the log of claims endorsed by the rank and file at Big Sister. Then the mass meeting instructs the AMWU to have one more meeting with Big Sister management, and then if these talks fail clearly the employees have indicated that's set out in the MFI5, is that the discussions as to be premised on the basis of the log of claims which has been filed, which the Commission has marked as MFI2 in these proceedings.

PN315

Mr Wallace's evidence, and it wasn't challenged by Mr Schmitke, was that there was no provision in there relating to the restriction on the use of labour hire. It would therefore follow, in our respectful submission, that all MFI5 can be taken to say is that the employees have said to Big Sister that they would like to negotiation on those points set out in MFI2 and reach agreement in relation to them. And there is absolutely no proposal in MFI2 with respect to the restriction on the use of labour hire.

PN316

On the point Mr Schmitke raised with respect to the need for concessions, I don't need to say anything further than the Commission would be aware that that point's been tried and tested and it's been dealt with by the Commission in a number of cases, and there is no requirement for concessions. The other point relates to a finding by the Commission that effectively the evidence of Mr Wallace on the point of whether or not the union has linked the MOU to the negotiation of the agreement should not be necessarily believed by the Commission.

PN317

Mr Wallace's evidence was clear. The Commission, in order to dismiss the evidence of Mr Wallace, would need to make a finding of credibility against him in relation to that. And there was nothing put in cross-examination and there was nothing put in any submissions as to whether or not Mr Wallace should be believed on his evidence and, in fact, there's nothing we would say that arises out of his evidence to suggest that the Commission could make a reasonable finding that his credibility was not to be preferred.

PN318

Therefore what follows is that the only person who can give evidence we say with respect to whether or not the MOU was linked to the agreement was Mr Wallace. His evidence is clear, it wasn't the subject of a challenge as to his credibility and as such the Commission would be correct in relying upon it in making a determination that the requirements of section 461 have indeed been met. The view of Mr Regan, with respect to him, it's simply his opinion, and it's an opinion not available we say from the clear words of the evidence. Those are our submissions, Commissioner.

PN319

THE COMMISSIONER: Thank you.

PN320

MR SCHMITKE: Can I just get some instructions in relation to the times, or would it be easier if we just informed your associate of those times?

PN321

THE COMMISSIONER: Yes. What I'm proposing to do is adjourn and reserve my decision, and get it fairly quickly I think, a decision out. But I would appreciate if the parties would confer and if you, as the applicant, could advice my associate of the times for which the ballot will be taken should the application be granted.

PN322

MR SCHMITKE: Yes.

PN323

THE COMMISSIONER: That's agreed. Is that it? I didn't know whether you were going to seek to say something further.

PN324

MR SCHMITKE: No further submissions.

PN325

THE COMMISSIONER: Thank you very much. This matter is adjourned, thank you.

<ADJOURNED INDEFINITELY [1.45PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

MFI #1 EMAIL FROM AUSTRALIAN ELECTORAL COMMISSION TO AIRC PN4
GEOFFREY KEITH WALLACE, SWORN PN11
EXAMINATION-IN-CHIEF BY MR NEILSON PN15
EXHIBIT #N1 STATEMENT OF GEOFFREY KEITH WALLACE PN25
MFI #2 FORM R4 RULE 16 PN36
MFI #3 DOCUMENT HEADED “BIG SISTER EBA POINTS FOR DISCUSSION” 11/12/2007 PN47
MFI #4 LETTER FROM AMWU DATED 27/02/2008 PN59
MFI #5 PIECE OF PAPER HEADED AMWU/BIG SISTER FOOD SIM PLOT PN68
CROSS-EXAMINATION BY MR SCHMITKE PN83
MFI #6 MEMORANDUM OF UNDERSTANDING PN91
THE WITNESS WITHDREW PN131
JOSEPH REGAN, SWORN PN137
EXAMINATION-IN-CHIEF BY MR SCHMITKE PN137
CROSS-EXAMINATION BY MR NEILSON PN160
RE-EXAMINATION BY MR SCHMITKE PN219
THE WITNESS WITHDREW PN229