C2008/113, Transcript of Proceedings [2008] AIRCTrans 480 (28 August 2008)

TRANSCRIPT OF PROCEEDINGS

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Workplace Relations Act 1996 18951-1

COMMISSIONER LARKIN

C2008/113

cl.29 Sch. 6 - Variation of transitional awards - general
Application by Media, Entertainment and Arts Alliance
(C2008/113)

SYDNEY

9.59AM, WEDNESDAY, 13 AUGUST 2008

PN1

MS C MONTGOMERY: I appear on behalf of the Media Entertainment & Arts Alliance.

PN2

MR C GRAHAM: I seek leave to appear for and on behalf of all commercial television stations other than the 7 and 10 Networks.

PN3

THE COMMISSIONER: Yes, thank you, Mr Graham. Ms Montgomery, do you have a view on the application for leave to appear?

PN4

MS MONTGOMERY: Yes, I do, thank you, Commissioner. Commissioner, myself and Mr Graham and the Commission have had discussions late yesterday afternoon.

PN5

THE COMMISSIONER: Ms Montgomery, do you object to Mr Graham's appearance?

PN6

MS MONTGOMERY: No, I don't, I'm sorry.

PN7

THE COMMISSIONER: Thank you. Leave is granted, Mr Graham. Now, I'll just state for the record, and Mr Graham and Ms Montgomery, I presume you've got copies, if not speak to my associate, we've received notification from the CPSU stating they've seen the draft orders that the MEAA provided to them and they consent to the making of those orders.

PN8

There's also correspondence from 7 Network not objecting to the variations sought in the attached draft order - I don't know what draft order that is but never mind, it's attached - and that they won't be making any appearance. So if you don't have copies of that material, please speak to my associate. Ms Montgomery, MEAA application.

PN9

MS MONTGOMERY: Thank you, Commissioner. Commissioner, in relation to this application, myself, Mr Graham and the Commission have had discussions - - -

PN10

THE COMMISSIONER: Not the Commission, my associate.

PN11

MS MONTGOMERY: Your associate, in relation to wages and allowances and also in relation to the loading for the director's fee. In my discussions with Mr Graham, Mr Graham has indicated that he would be happy in his submission - there was a confusion as to how the mileage allowance was calculated. That was one of the issues. I have actually spoken to the CPSU and they've advised me now as to how they calculated that expense allowance but I understand Mr Graham is able to expand on how these rates and allowances have been calculated previously.

PN12

THE COMMISSIONER: It's a bit of a mess. Mr Graham.

PN13

MR GRAHAM: Thank you, Commissioner. This is, I think, the first time I've appeared where there's been an application to vary a transitional award. I can, however, assist the Commission and the parties in relation to the methodologies that have been used in the past with respect to the pre-reform equivalent, the Television Industry Award 2000.

PN14

In 2000, the Television Industry Award, the pre-reform award, was varied for a new classification structure. The Commission may recall the Commission, as presently constituted, was involved in that process. When the rates of pay were varied at that time, the CPSU had carriage of adjusting the rates to take into account the 2000 national wage case.

PN15

They produced an exhibit and my understanding is that since then, the pre-reform award has been adjusted according to the methodology used in that exhibit and I thought that for the assistance of the parties, because rates of pay are at issue, that I could very quickly identify how the calculations occur so at least we have a benchmark on transcript which the Commission and the parties have as a reference point.

PN16

THE COMMISSIONER: Sorry, Mr Graham, I'll just interrupt you for one moment. My apologies, Mr Graham.

PN17

MR GRAHAM: The allowances adjustments in the Television Industry Award, the pre-reform award, are split into two. They are wage related allowances on the one hand and expense related allowances on the other. Dealing with wage related allowances, the methodology in the past was if you looked at, for example, the 2006 national wage case, you would take the wage increase in 2006, you would divide that by what's called the C9 rate, not the C10 rate, and multiply that by 100 to get a percentage. My calculations are that it would be 4.49 per cent.

PN18

THE COMMISSIONER: This is relevant to the TV Industry Award, Mr Graham?

PN19

MR GRAHAM: This is the pre-reform award, not the transitional award.

PN20

THE COMMISSIONER: Yes.

PN21

MR GRAHAM: You would do the same for the 2007 national wage case, taking the increase, divided by the old rate, multiplied by 100. That would give you a percentage figure and the wage related allowances in clause 25 of the Television Industry Pre-reform Award would be adjusted accordingly.

PN22

So the broadcast operator's certificate of proficiency allowance, the television operators certificate of proficiency allowance, the height allowance and the first aid allowance are all wage related allowances and would be adjusted by that percentage.

PN23

THE COMMISSIONER: Mr Graham, why was it the C9 and not the C10?

PN24

MR GRAHAM: There was at the time an issue as to where the technician rate fitted within the C9 and C10 levels. At the time, and my memory is now going back eight years, Commissioner - - -

PN25

THE COMMISSIONER: Mr Graham, tell me about it, yes.

PN26

MR GRAHAM: At the time, there was two factors. One was to identify where the C10 rate fitted with the technician A or technician B metropolitan schedule and on the other hand, there was a non-metropolitan schedule of rates where the rates were slightly different.

PN27

The parties, by consent, and that consent was approved by the Commission, identified the C9 rate as the critical rate in terms of where the technician, under the new award, sat and since then, they've used the C9 rate for the purposes of the benchmark for any decision of the Commission that has related to the traditional trade rate.

PN28

THE COMMISSIONER: So it's the traditional trade rate?

PN29

MR GRAHAM: In the Television Industry Award, yes.

PN30

THE COMMISSIONER: So therefore it still sits comfortably with furnishing trades?

PN31

MR GRAHAM: Yes, I believe so and it's always been used since then as the divisor where you are trying to establish a percentage for the wage related allowances.

PN32

THE COMMISSIONER: Yes.

PN33

MR GRAHAM: Now, traditionally, as far as the pre-reform award is concerned, the BOCP and TVOCP allowances have been adjusted to the nearest ten cents. As far as the expense related allowances are concerned, the expense related allowances are the vehicle allowances taken from the Bureau of Statistics CPI index called Expense - Private Motoring Group. The meal allowance is taken from the same place and it's taken from the schedule called Expense - Meals Out and Takeaway Foods.

PN34

The other outstanding issue is the directors' loading. The wage increases traditionally are applied to the base rate and then that base rate has an off the time book 25 per cent loading on top of it which is applied to give a second rate. The second rate on each of the classifications which has an off the time book loading of 25 per cent is applied to the base rate and then traditionally it's been rounded to the nearest ten cents.

PN35

One of the difficulties, of course, that we've had with this is WorkChoices. We have two tribunals, the AFPC has set rates of pay, the AIRC has by and large, as you would be well aware, followed that but in terms of the cents, has rounded that off. The only other thing I think I need to say is that there was an issue after the first wage setting decision by the Fair Pay Commission as to where the TVOCP and BOCP allowances sat.

PN36

I argued, unsuccessfully, before a Full Bench that those allowances were part of the rate of pay. The Full Bench did not accept that view and has identified those allowances as skills based allowances but allowances nevertheless. The Commission may recall that there was quite a few of those kinds of issues at the time. The building industry had similar kinds of allowances.

PN37

I don't think that that Full Bench decision makes any difference to the methodology that I have proposed. I don't think it makes any difference at all. We still have to be mindful, according to that Full Bench decision, that what we are dealing with as far as the BOCP and TVOCP are concerned is that they are allowances and of course we must abide by that.

PN38

THE COMMISSIONER: The wage related allowances.

PN39

MR GRAHAM: Wage related allowances. Commissioner, I think that's as much as I can say in terms of identifying the issues. I've seen a number of draft orders and I think Ms Montgomery has got a further draft order today which I have not seen but I know there are some issues in relation to rates.

PN40

What I propose is that as I've put what I believe the methodology on transcript, that at least provides a benchmark for the parties to consider. We would not be opposed to the Commission deciding to vary the award today but we would ask that the Commission give us say seven days prior to issuing the order so that the parties and the Commissioner's associate could confer in an attempt to rectify any differences in terms of methodology and calculations.

PN41

THE COMMISSIONER: Mr Graham, those calculations, the only difference would be reasonably minor in a sense.

PN42

MR GRAHAM: Yes, it would.

PN43

THE COMMISSIONER: Mind you, it's imperative to get any variation correct.

PN44

MR GRAHAM: Yes, I understand.

PN45

THE COMMISSIONER: Especially for the future of these awards. While they may not have the status that they had many years ago, they are a very important industrial instrument. People rely upon them and they must be correct. But I would prefer to wait 14 days because another thing is that I think it's appropriate that Channel 10 and Channel 7 and the CPSU, while two of those parties have consented, I think it's imperative that they be provided with an opportunity to peruse the transcript, which my associate will forward to them, and of course the parties before me, the parties you represent, Mr Graham and of course MEAA will receive a copy of the transcript. It's also imperative that they receive a copy of the order that you and Ms Montgomery with the assistance of my associate will ensure from our perspective is correct.

PN46

I would like that order provided to the Commission and to those other parties within seven days with advice to them that they have a further seven days to raise any objection. Ms Montgomery, that will be MEAA's responsibility and that correspondence is to be copied to Mr Graham and to myself as well. So you have seven days and I'll actually here the MEAA submission as in to the application to vary but apart from that, if I'm satisfied that the award should be varied, then you have seven days to discuss. That's your maximum, if you can do it earlier, please do, but you have seven days to agree the correct figures.

PN47

MEAA then must, as soon as that is agreed, forward advice to Channel 10, CPSU and the 7 Network and also a copy to this Commission advising them of the draft and that they have seven days to peruse that draft and raise an opposition with the Commission.

PN48

MR GRAHAM: There is one further thing, and if I could just indicate it, Commissioner, and it doesn't go to this application but I am conscious of the fact that we have through legislative design two awards. The Television Industry Pre-reform Award and the transitional award. The rate of pay in the pre-reform award and the transitional award will, because of the adjustment to the cents, be different in some respects.

PN49

There would be, I would have thought, no reason why the allowances in the pre-reform award and the transitional award should be different. If it emerges that they are different, then it may be that the Commission needs to be approached on that because I fear the difference is because of using different methodologies in different industrial instruments. There can't, I wouldn't have thought, be any reason why we should have differences between the allowances in the two awards.

PN50

THE COMMISSIONER: Well, there won't be, there's no way. There's no difference in the cents of wages because the wages do not exist in the pre-reform. The wages exist in the transition. So what the transition says, providing the parties and the Commission are satisfied that the methodology is correct, then that would be the wage rates.

PN51

The allowances, why would the allowances be different, Mr Graham? Because I tend to agree with you, why should they be different? The same methodology, in my view and if somebody points out to me a difference should apply so do we have a concern, has there been errors?

PN52

MR GRAHAM: Well, if it emerges that there are differences, the question for the Commission I guess is whether there needs to be a correction order in the pre-reform award.

PN53

THE COMMISSIONER: Mr Graham, were you involved in the variation to the TV Award from the pre-reform variation to the TV Award by my order dated 20 September 2007, which was to be operative 1 October 2007?

PN54

MR GRAHAM: Yes, I was and I consented to that application and I have tried, at least I guess in a shorthand way, to say to the parties that I thought that those allowances were right. But if it emerges that we were wrong, that's an issue that weights heavily on me because, as you've said, whether we're dealing with the transitional award or the pre-reform award, these are industrial instruments that require accuracy in their rates.

PN55

THE COMMISSIONER: You see, prior to that particular variation - I don't know, did I do the one prior to that? The Full Bench did a variation in June. The Full Bench did the variation in relation to the 2006 review. One could possibly argue that would be a correct variation so the September 2007 order that I issued - not quite sure how you actually say this but that was in a period where an associate that had been with me for many, many years - who you would know very well, Mr Graham, and as does Ms Montgomery - who would calculate all this methodology was not with me around that time. That is no criticism of any associate that may have been with me but of course my previous associate, of course, having 12 years and of course both of you know him extremely well and he had the history of all the Full Bench decisions and how to calculate. It's like losing corporate identity, corporate history at times.

PN56

So I think my order of 20 September 2007 may require consideration by you and Ms Montgomery to ascertain whether that variation was correct. If the parties and the Commission, having considered that, form a view that it wasn't correct then there would be a matter of me issuing a correction order.

PN57

MR GRAHAM: The only other thing I'd like to add, of course, is that the Commission has not had the power to vary wages in the pre-reform award since 2005 and has, if I could put it delicately, had no assistance from any other body in terms of official rates either and that is something which doesn't sit well with the people I represent either, I might say, that we don't have official rates. It's no criticism of the Commission, the Commission has had no power to issue that and that just makes our task a little more difficult.

PN58

THE COMMISSIONER: Well, what we're dealing with in this instance, the application today is for a transitional award so we must ensure that the rates and the allowances are correct in that award but if it comes to light that there's an issue with the pre-reform award and my order then I'm sure the parties will contact me and if I agree with them, then I think it would be appropriate to issue a correction order on the pre-reform award.

PN59

MR GRAHAM: Thank you, Commissioner.

PN60

THE COMMISSIONER: Mr Graham, thank you very much for your assistance. You always are of great assistance with these awards over many, many years and it's much appreciated. Ms Montgomery, your application. I do note that you sought to amend the application. The application was filed and there was some form of typographical error.

PN61

MS MONTGOMERY: That's correct.

PN62

THE COMMISSIONER: Yes, so I think it didn't include rates of pay, or it might have been the other way around. It was either one or the other.

PN63

MS MONTGOMERY: It was the allowances, Commissioner.

PN64

THE COMMISSIONER: Yes, and of course logic is, and I don't think anybody is objecting, that of course in a transitional, that is what you would have sought to vary, both the rates and the allowances. So if you're seeking leave to amend your application, unless I hear an objection, leave is granted. So whenever you're ready, you can give me your submissions.

PN65

MS MONTGOMERY: I'm sorry, Commissioner, I'm actually deaf. I've got hearing aids on so things tend to - I didn't quite hear the last - - -

PN66

THE COMMISSIONER: Your application to amend the application is granted, it's not objected to. I just need to hear your submissions in regards to the serving. There was no substitute of service on this award - - -

PN67

MS MONTGOMERY: That's correct.

PN68

THE COMMISSIONER: - - - because you're seeking to apply to 2006 and 2007.

PN69

MS MONTGOMERY: That's correct. Thank you, Commissioner. Commissioner, you have before you an application as per clause 29, schedule 6 of the Workplace Relations Act 1996 to vary the Television Industry Award 2000 transitional. This application seeks to increase the minimum rates of pay in line with the wages and allowances review of 2006 and the wages and allowances review 2007.

PN70

Further, the application seeks to increase expense allowances and reimbursement allowances, reimbursement allowances being in line with the method set out in the Furnishing and Glass Industries Allowances decision, and the expense allowance in line with the Private Motoring CPI increases for those years.

PN71

Commissioner, the Alliance notes that the original application to vary the transitional award together with the notice of listing, the draft order and the formula for the calculation of both allowances were all served on the persons noted as respondents to the award by certified post on 25 July 2008 and I'm able to hand up my statement as to service.

PN72

With respect to the increases to the rates of pay, the award was last increased to give effect to the safety net review decision of June 2005, print 59590. This application as stated is to give effect to the safety net decisions of the Commission of the wages and allowances review 2006 and the wages and allowances review 2007. I'm able to hand up a copy of my draft order, however, keeping in mind the earlier submissions in that the parties will - - -

PN73

THE COMMISSIONER: Yes, look, I think on the file we have a couple of draft orders so the draft order that the parties are going to be looked at is to be served on all parties to the award anyway, if I grant the application that is. So I don't think that we need to do that, please continue.

PN74

MS MONTGOMERY: Thank you, Commissioner. With that said, Commissioner, the MEAA would seek that the application be granted by the Commission pending as directed by the Commission that the parties confer and have seven days to agree to what the draft order will look like and MEAA has undertaken to forward to Network 7 and Network 10 - - -

PN75

THE COMMISSIONER: And the CPSU.

PN76

MS MONTGOMERY: - - - and the CPSU copies of that draft order and to confer with those parties and as instructed by the Commission, that those parties, Mr Graham, Network 7, Channel 10 and the CPSU have seven days to comment and that MEAA is required to file and notify the Commission within 14 days as to the final draft order and - - -

PN77

THE COMMISSIONER: No. Ms Montgomery, what it is is that you and Mr Graham have no more than seven days to agree a draft. That draft is to go under cover of email or what have you to all the parties, Mr Graham is of course representing his people and he would take care of that, but MEAA are to advise all other parties of the draft order and advise them that they have seven days in which to raise issues or objections to the Commission.

PN78

That correspondence with the draft order is also to be filed in this Commission within that seven day period. The Commission will then wait a further seven and if no objections or issues are raised then the order will issue.

PN79

MS MONTGOMERY: Thank you for clearing - - -

PN80

THE COMMISSIONER: The order will be operative as of today, with a period of six months, if that is what the parties agree to.

PN81

MS MONTGOMERY: Thank you, Commissioner.

PN82

MR GRAHAM: I agree to that.

PN83

THE COMMISSIONER: Anything further, Ms Montgomery?

PN84

MS MONTGOMERY: No thank you, Commissioner.

PN85

THE COMMISSIONER: All right then. Thank you for those submissions. The application before me is an application to vary the Television Industry Award 200, a transitional award. The application has come in under clause 29, schedule 6, variation of transitional awards and on the basis of material and of course the submissions that I've heard, I'm satisfied that the application is in accordance with schedule 6 of the Act and also Full Bench decisions in the review cases of 2006 and 2007.

PN86

The transitional award will be varied as of today's date, however that order will not issue, as discussed in proceedings, for a period of 14 days to allow parties to the award to make comment or to raise objections in relation to that. If there's nothing further, the Commission stands adjourned.

<ADJOURNED ACCORDINGLY [10.29AM]