AG2008/1142, Transcript of Proceedings [2008] AIRCTrans 420 (6 August 2008)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 18849-1

COMMISSIONER LEWIN

AG2008/1142

cl.2A(1)(b) Sch. 7 - Appl’n for an order to vary pre-reform cert. agt.
Application by Nestle Australia Ltd
(AG2008/1142)

MELBOURNE

2.28PM, WEDNESDAY, 23 JULY 2008

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

PN1

MR J CORBEIT: I appear on behalf of Nestle with MR P HARPER, human resources manager with Nestle Peters Ice Cream.

PN2

THE COMMISSIONER: Mr Donoghue and Mr Watson, you're employee representatives. Is that right?

PN3

MR B WATSON:: I am, yes.

PN4

THE COMMISSIONER: Mr Donoghue?

PN5

MR D DONOGHUE: Yes.

PN6

THE COMMISSIONER: You are an employee representative?

PN7

MR DONOGHUE: Yes, I am.

PN8

THE COMMISSIONER: Can you tell me how it is that you came to be employee representatives? Was there an election?

PN9

MR WATSON: No.

PN10

THE COMMISSIONER: Were you appointed as employee representatives?

PN11

MR WATSON: Just by the state manager and the territory manager appointed me.

PN12

THE COMMISSIONER: Is that the case for you, Mr Donoghue?

PN13

MR DONOGHUE: Yes.

PN14

THE COMMISSIONER: Mr Corbeit.

PN15

MR CORBEIT: Commissioner, two separate applications have been made in relation to the Nestle Peters Ice Cream Queensland Customer Service Representative Enterprise Agreement 2005, one to extend the agreement for an additional three years to 31 March 2011 and one to vary the agreement in the terms set out in the draft order which has been filed. Both applications are made pursuant to clause 2A of schedule 7 of the Act.

PN16

Commissioner, the company submits that genuine agreement has been reached with the employees covered by this agreement to extend and vary in the terms sought. We rely on the statutory declarations of Mr Paul Harper which set out the process that has been followed whereby all employees were given an opportunity to consider and decide whether to accept the proposed extension and variation.

PN17

In relation to both applications, neither party has engaged in or threatened to organise any industrial action, nor has either party applied for a secret ballot. In relation to the application to vary the agreement, the agreement would not result, on balance, in any reduction in the overall terms and conditions of employment of those employees bound by the agreement when compared with the relevant transitional awards, those awards being the Van Salespersons Award for the northern and Mackay regions of Queensland and the Transport Distribution and Courier Industry Award for the southern division of Queensland.

PN18

Commissioner, unless you have further inquiries, they are our submissions.

PN19

THE COMMISSIONER: I'm not quite sure whether you've tendered the documents with the employee signatures on them. Have you done that?

PN20

MR CORBEIT: Yes, there was - - -

PN21

THE COMMISSIONER: It was filed, was it?

PN22

MR CORBEIT: It was filed, yes.

PN23

THE COMMISSIONER: Let me just see if I can find it. My understanding is that the way in which the valid majority was formed was by employees signing a document indicating their approval of the terms of the variations.

PN24

MR CORBEIT: That's correct, Commissioner.

PN25

THE COMMISSIONER: I'm just looking for that on the file. Did you file the document?

PN26

MR CORBEIT: No, that document wasn't filed but we do have the original.

PN27

THE COMMISSIONER: Can I see it, please.

PN28

MR CORBEIT: Yes, sure.

PN29

THE COMMISSIONER: Some of these are copies.

PN30

MR CORBEIT: Yes.

PN31

THE COMMISSIONER: Do you have the originals?

PN32

MR CORBEIT: Commissioner, some are copies, I understand, because they were emailed from Queensland through our Peters Ice Cream office in Melbourne.

PN33

THE COMMISSIONER: There's quite a few original signatures and I think a total of nine signatures in photocopy form. Is it possible to obtain the original signatures?

PN34

MR CORBEIT: I'm sure we could, Commissioner.

PN35

THE COMMISSIONER: I direct you to file those. I'll arrange for my office to ensure that you have a photocopy of all of the documentation filed in original and the original will remain on the Commission's file and be accessible by the parties if necessary. I direct you to do that by the close of business Friday week.

PN36

MR CORBEIT: Yes, Commissioner.

PN37

THE COMMISSIONER: Is it the case therefore that the signatures, assuming they were all tendered in the original, add up to a number of employees which is the majority of those who will be bound by the agreement and its variations?

PN38

MR CORBEIT: Yes, Commissioner. I understand that every employee covered by the agreement has agreed - - -

PN39

THE COMMISSIONER: Has actually signed. So when all the originals are filed, what will be on the file is the employees' signature indicating approval of the terms of the variations on behalf of each individual employee covered by the agreement.

PN40

MR CORBEIT: Yes.

PN41

THE COMMISSIONER: I'll just take you to the draft order. You filed the draft order, I take it.

PN42

MR CORBEIT: I did, yes.

PN43

THE COMMISSIONER: There's a couple of things that are not significant but probably need to be corrected. I think the proper title of the agreement will be the Nestle Peters Ice Cream Queensland Customer Service Representative Enterprise Agreement 2005-2011.

PN44

MR CORBEIT: Okay.

PN45

THE COMMISSIONER: That's the proper description, isn't it

PN46

MR CORBEIT: Yes, it is, yes.

PN47

THE COMMISSIONER: This isn't a new agreement.

PN48

MR CORBEIT: No.

PN49

THE COMMISSIONER: This application seeks to vary the terms of the 2005 agreement and to extend its life to 2011 so I think a proper description of the agreement should represent the preservation of its operation from 2005 to 2011. Indeed, that is consistent with the table of weekly wage rates which are proposed to be incorporated but it seems to me that it's actually appropriate to leave all of the wage rates for the relevant life of the agreement which is 2005-2011 in the body of the agreement so the variation should be the addition of the new weekly wage rates to commence from 1 April 2008. That's correct, is it not?

PN50

MR CORBEIT: Yes, Commissioner.

PN51

THE COMMISSIONER: That's the first of the new wage rates and then there are several wage rates which will come into operation from various dates until 1/10/2010 and remain in force for the life of the agreement?

PN52

MR CORBEIT: That's right.

PN53

THE COMMISSIONER: In other words the table will be complete rather than deleting the existing table and inserting a new one. That correction will need to be made to the form of the order.

PN54

MR CORBEIT: Commissioner, we did actually file an amended draft order.

PN55

THE COMMISSIONER: You did?

PN56

MR CORBEIT: Yes, that included both wage rate tables.

PN57

THE COMMISSIONER: I haven't seen that, with all due respect. That may be because my associate is absent ill today and it might not have caught up with the file as yet. In any event, any order that does issue on this application will reflect all the wage rates for the life of the agreement from commencement to expiry in accordance with the agreement that's now been reached in relation to the wages to be paid between April 2008 and the expiry of the agreement.

PN58

It seems to me that, apart from these matters, that is to say the description of the agreement, changes to the timing for the negotiation of a new agreement and the prescription of new wage rates, the other issue affected by the application for variation concerns the introduction of commission payment payable in lieu of overtime at certain times.

PN59

MR CORBEIT: That's correct, Commissioner.

PN60

THE COMMISSIONER: This does present some difficulty in that the commission which would be payable in lieu of the overtime is unknown.

PN61

MR CORBEIT: At this point in time, that's correct because it hasn't been developed yet.

PN62

THE COMMISSIONER: It is not possible for me to actually reach a conclusion as to whether or not the commission which would be paid would be sufficient for the agreement to pass the no disadvantage test because I could not compare the value of the commission against the value of the overtime foregone. That's the first dimension of that problem.

PN63

There is also an issue which has arisen under the provisions of the Act prior to the amendment under which this application is made whereby a Full Bench of the Commission has determined that the Commission cannot approve a term of agreement which permits an unspecified variation during its life, the reason being that it's not an agreement as such, it's a foreshadowed agreement which is being approved. What the Commission is effectively doing is prospectively approving whatever agreement arises, rather than approving a specified agreement having regard to the statutory requirements for the approval of agreements.

PN64

This could be remedied, however, if an amendment was made to the application such that included in the terms which would apply where commission payments are made in lieu of overtime, that the commission payments at any time would be no less than the overtime payable for the hours worked. That way, two things are remedied, as I have identified them. Firstly, I would be able to be satisfied that any commission payment scheme would not disadvantage the employees because I would know if that was a term of the variation that the overtime worked would not be remunerated at a lesser value because the commission payments would be equal to or higher than the value of the overtime.

PN65

MR CORBEIT: Would that be in reference, Commissioner, back to the overtime provisions in the relevant transitional awards?

PN66

THE COMMISSIONER: It would. That's how the no disadvantage test operates, not the overtime provisions of the agreement.

PN67

MR CORBEIT: The reason I ask that question is because the rates in the agreement were above $200 per week greater than the rates - - -

PN68

THE COMMISSIONER: No, you're quite correct. The test is the minimum standard set out in the award. The Act doesn't change that. That's the characteristic of the no disadvantage test. That way there's no issue of any disadvantage arising and that problem is dispensed with. It would seem to me that it probably solves the problem that anything that may be paid - and it may be necessary to express this in the variation - will be in addition to the terms of the agreement. I think that's your intention, isn't it?

PN69

MR CORBEIT: It is our intention, yes.

PN70

THE COMMISSIONER: It's in substitution of any overtime payments. The relevant minimum standard is the award overtime prescription and if that's met, then obviously, you're intending that you'll pay commission over and above that.

PN71

MR CORBEIT: Yes.

PN72

THE COMMISSIONER: That could be the remedy to that problem. I don't know whether you're able to indicate that a draft order reflecting that could be submitted or not now.

PN73

MR CORBEIT: Yes, we could do that.

PN74

THE COMMISSIONER: Yes, well, subject to that matter. I don't have any difficulty with the application. I might just explain it to the employee representatives. Mr Donoghue and Mr Watson, I imagine that you may consider it appropriate as a result of your attendance today to inform the employees of the proceedings and to tell them what happened, no doubt.

PN75

MR WATSON: Yes.

PN76

THE COMMISSIONER: You've probably listened to the discussion between myself and Mr Corbeit about some aspects of the application. Are you clear on what we were discussing.

PN77

MR WATSON: Yes.

PN78

MR DONOGHUE: Absolutely.

PN79

THE COMMISSIONER: If you have any questions I'm happy to answer them.

PN80

MR WATSON: No, everything is fine, Commissioner.

PN81

THE COMMISSIONER: I'll just summarise it for you, though, in case your colleagues ask you what happened. The first thing is that the title of the agreement probably has to reflect the fact that this isn't a new agreement. What's happening today is there's an application for a variation of the existing agreement. The first thing to do is to extend its life until 2011 and to add additional terms. Here's the second: the additional terms relate to wage increases between April 2008 and the expiry of the agreement in 2011 and what I have indicated is that it's not appropriate to remove from the agreement the prescription of the wage rates which operated between 1 April 2005 and up until the 28th - I'm sorry, what was the date of expiry again?

PN82

MR CORBEIT: 31 March 2008.

PN83

THE COMMISSIONER: Up until 2008 and the reason for that is, that if they go out of the agreement and there's any question on the part of any employees as to whether they have been correctly paid, there's no reference available any more in the document to what the relevant wages rates were in the past and what dates they accumulated from. It's probably not a matter of any significance but it's important that the agreement be understood as an agreement running between 2005 and 2011 and it have wage increases recorded in it for the whole of that period. Those two things are largely administrative in nature.

PN84

The third concerns the commission payments and what I require from the company is that the commission payments have to be conditional upon two things. The first is that an employee will receive no less for the overtime that they would work then they would have received under the relevant award so in other words, the commission payments have got to be better than the award minimum, otherwise the award minimum is payable for the overtime.

PN85

The reason for that is that for the variation to be approved by the Commission the Commission has to be satisfied the agreement passes the no disadvantage test and for that particular proposal as to commission payments to pass that test, the condition which I have sought from the company I believe would have to be included as a variation to the terms of the agreement. The other aspect of the matter is that the commission payments would be paid in addition to all other terms of the agreement, that is, not in substitution of any other employment benefit that's prescribed by the agreement.

PN86

What I will do is direct that in addition to the direction I have given earlier about the filing of the originals of the employees' approval of the terms of the variations to the agreement sought by the application, I'll direct that by Friday week the company file an amended draft order to reflect the matters discussed in the hearing today and at that time I indicate that I'm satisfied once that is done, that the agreement meets all the statutory requirements for the extension and variations sought and I will issue an order accordingly. Thank you.

<ADJOURNED INDEFINITELY [2.47PM]