AG2010/7793, Transcript of Proceedings [2010] FWATrans 776 (3 May 2010)

TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009 25897-1

DEPUTY PRESIDENT SAMS

AG2010/7793 AG2010/797 AG2010/798 AG2010/799 AG2010/800 AG2010/801 AG2010/802 AG2010/803

s.225 - Application for termination of an enterprise agreement after its nominal expiry date

Sydney Water Corporation t/as Sydney Water
and
Association of Professional Engineers, Scientists and Managers, Australia, The
(AG2010/803)
Sydney Water Corporation Limited, Utilities Business Professional Engineers Agreement 1997

(ODN C22325/97)
[AG797216 Print]




Sydney

10.31AM, MONDAY, 19 APRIL 2010

PN1

THE DEPUTY PRESIDENT: Could I have the appearances.

PN2

MR N. SAUNDERS: Mr Saunders for Sydney Water, your Honour.

PN3

THE DEPUTY PRESIDENT: Yes.

PN4

MS J. HANNAN: Hannan, initial J, for APESMA, your Honour.

PN5

THE DEPUTY PRESIDENT: Thank you. Is it the wish of the parties that all matters be joined?

PN6

MR SAUNDERS: Yes, your Honour.

PN7

MS HANNAN: Yes, your Honour.

PN8

THE DEPUTY PRESIDENT: I will join all of the matters listed, being 801, 7793, 797 to 803 of 2010. Yes, Mr Saunders.

PN9

MR SAUNDERS: Thank you, your Honour. There are eight applications today for the termination of eight enterprise agreements. That application is made under section 225 of the Fair Work Act, so if the termination of the enterprise agreements is passed the nominal expiry dates. All of the agreements in question have, as a matter of fact, passed their nominal expiry dates. I note that under section 226 of the act:

PN10

Fair Work Australia must terminate the agreements if it satisfied that it is not contrary to the public interest to do so and if it considers it appropriate to do so in all the circumstances.

PN11

In relation to this application, I would like to state that Sydney Water earlier this year had a new enterprise agreement ratified by Fair Work Australia; that's the Sydney Water Enterprise Agreement 2009. It was approved on 22 March by Lawler VP in matter number AG2009/14491. That new agreement covers all Sydney Water employees, with the exception of its tradesmen who are currently negotiating their own enterprise agreement and in any event wouldn't fall under any of the ones that are up for termination today. It also doesn't cover any people who are covered by individual contracts in senior manager pay bands 3 and above.

PN12

For your information, your Honour, the maximum pay rates of level 2, which is where the new agreement cuts out, is $191,100 per annum. What that means, to cut to the chase, is there are approximately 80 people on individual contracts at the very of the organisation who aren't covered by that new agreement.

PN13

I would submit to you that the public interest in this instance is not served by the continued operation of these overlapping potentially contradictory enterprise agreements. I also note that the vast bulk of these agreements are worded in a way that they refer to other old awards and try to partially displace the conditions of those old awards. Now, as I've stated, Sydney Water has it's new enterprise agreement that is meant to cover the field. It was recently negotiated with APESMA. We would say that it adequately deals, and it comprehensively deals, with conditions of employment for all of the employees that would be covered by these EAs.

PN14

I also note that if these EAs are terminated today, that the 80 employees at the top of the tree who aren't covered by the new Sydney Water enterprise agreement would still retain their current right to commence a bargaining period in relation to a new enterprise agreement should they choose to do so. That being said, it's been Sydney Water's experience that these particular employees are very highly paid individuals who prefer to take care of their own conditions of employment through individual negotiations and to have those negotiations reflected in their individual contracts.

PN15

All that being said, I would submit that it's in the public interest to terminate these enterprise agreements. Also, it's our position that the agreement should be terminated.

PN16

THE DEPUTY PRESIDENT: So just so I'm clear about, the 80 you say are not covered by the new enterprise agreement were covered by these agreements. Is that what you're saying?

PN17

MR SAUNDERS: No, they may not have been. Part of the problem has been with these old agreements that some of them may have been, if they held an engineering qualification and some determination was made as to whether or not they were required to use that engineering qualification - of course they are people at the very top of a tree and we would strongly argue that they don't have to use an engineering qualification in their everyday work as general managers or the CEO, for example.

PN18

Sydney Water's position has been, and Sydney Water's experience, as I said, has been, that these people perceived of themselves as under an individual contract when they commenced when employment with the organisation, and often as they progressed through promotional opportunities with the organisation, they enter into individual negotiations to determine their own conditions.

PN19

THE DEPUTY PRESIDENT: How many employees covered by these applications are there?

PN20

MR SAUNDERS: Currently - it's difficult to tell, your Honour.

PN21

THE DEPUTY PRESIDENT: Well, guess.

PN22

MR SAUNDERS: 10 to 20, at the most.

PN23

THE DEPUTY PRESIDENT: Covered by all these agreements?

PN24

MR SAUNDERS: Yes. This is more a housekeeping exercise, from Sydney Water's perspective, than anything else. We did just go through quite a comprehensive negotiation for our new enterprise agreement, and we believe that covers the field. It certainly covers the vast bulk of our employees.

PN25

THE DEPUTY PRESIDENT: So those 10 or 12 go onto the new enterprise agreement.

PN26

MR SAUNDERS: No, they wouldn't. If they are currently covered, they will become agreement-free employees. All of their commissions would be as per their individual contracts of employment and the national employment standards, whatever other legislative bits and pieces they can appeal to.

PN27

THE DEPUTY PRESIDENT: That's in addition to the 80 who were not covered in any event.

PN28

MR SAUNDERS: No, that's part of the 80.

PN29

THE DEPUTY PRESIDENT: I see.

PN30

MR SAUNDERS: As I said - - -

PN31

THE DEPUTY PRESIDENT: So there's 80 in total.

PN32

MR SAUNDERS: 80 who are definitely not covered by the new enterprise agreement.

PN33

THE DEPUTY PRESIDENT: Yes.

PN34

MR SAUNDERS: Of those, potentially up to 20 may be covered by some of these agreements that are up for termination. The key factor there is, do they hold an engineering qualification and are they required to use that qualification in their everyday work. As I said, that's a point that's obviously prone to debate. Should there be any issues, I'm sure it would be debated.

PN35

THE DEPUTY PRESIDENT: Take, for example, 801, that's the Sydney Water Corporation Enterprise Agreement 2000. That doesn't seem to be restricted to the group of employees you've just described. It seems to be the main enterprise agreement, is it?

PN36

MR SAUNDERS: Yes. As I said, this is part of the problem, that some of these agreements are worded to involve all employees, which would then be completely displaced by the new enterprise agreement; others are worded to have this engineering qualification. From our analysis, it would appear that only - and also, others of them are worded to cover Australian Water Technologies, which is a corporation that no longer exists, or Sydney Water Holding Corporation. Once again, that corporation no longer exists.

PN37

THE DEPUTY PRESIDENT: So I will go back to the first question I asked. All of these applications cover all of the Sydney Water employees, do they, save for those 80 that you were talking about?

PN38

MR SAUNDERS: These applications which are really made under the Workplace Relations Act directly with APESMA, Sydney Water historically has been in the state jurisdiction and so had there been a problem with all of our employees, generally it would be state instruments. They agreement were only entered into to provide a mechanism for APESMA to in essence represent the same people. Generally, as I said, we've been at the state Industrial Commission and if there had been a problem, it would have been raised under a state instrument, unless it was an APESMA member that was affected.

PN39

THE DEPUTY PRESIDENT: I'm not clear as to - as I said, take for example the Sydney Water Corporation Enterprise Agreement 2000. Doesn't that cover everybody, or the vast bulk of the employees?

PN40

MR SAUNDERS: Yes, it would, your Honour.

PN41

THE DEPUTY PRESIDENT: So it's not only APESMA that are - - -

PN42

MR SAUNDERS: But there was, at the same time, a mirror agreement entered into at the New South Wales state commission which had as its parties the ASU, ETU, AMWU, which are other unions that represent the vast bulk of our employees.

PN43

THE DEPUTY PRESIDENT: Yes. That's that agreement, isn't it; Sydney Water Corporation Enterprise Agreement 2000.

PN44

MR SAUNDERS: Yes. So there was a mirror agreement at the state commission. That has since been cancelled and replaced. This is a hangover because we haven't been doing our keeping up to date - - -

PN45

THE DEPUTY PRESIDENT: I see.

PN46

MR SAUNDERS: - - - with our federal stuff because we've only recently moved to the federal jurisdiction holus-bolus.

PN47

THE DEPUTY PRESIDENT: So the vast bulk of the other employees, all the ETU and ASU, are covered by the new enterprise agreement.

PN48

MR SAUNDERS: Yes, Commissioner, this one.

PN49

THE DEPUTY PRESIDENT: That was approved by - - -

PN50

MR SAUNDERS: It was made late last year - - -

PN51

THE DEPUTY PRESIDENT: - - - Lawler VP.

PN52

MR SAUNDERS: - - - and approved by Lawler VP end of March.

PN53

THE DEPUTY PRESIDENT: So the extent that the Sydney Water Corporation Enterprise Agreement 2000 still applied, it only then still applied to this small group of employees.

PN54

MR SAUNDERS: Yes, it would only still apply to employees above senior manager pay band 2, which, as I said, this group above the 80, earn above 191,100.

PN55

THE DEPUTY PRESIDENT: So it remained in existence just because of the timing of your negotiations.

PN56

MR SAUNDERS: Yes.

PN57

THE DEPUTY PRESIDENT: I understand. The new agreement, is that a federally registered agreement?

PN58

MR SAUNDERS: Yes, it is.

PN59

THE DEPUTY PRESIDENT: Of course it is. What am I asking that for? Lawler VP made it. So you're completely out of the state jurisdiction now, are you?

PN60

MR SAUNDERS: Yes, we are, your Honour.

PN61

THE DEPUTY PRESIDENT: Thank you.

PN62

MS HANNAN: Your Honour, we have considered the applications put forward by Sydney Water and, pursuant to section 226 of the Fair Work Act 2009, our view is that there's no issue in terminating these residual agreements. There are two that we had a particular concern about and we've gone through those and satisfied ourselves that the provisions of a new enterprise agreement, and the people who would have been potentially covered by those agreements - it's a mutually agreed upon position between APESMA and Sydney Water. So at this stage we won't be raising any objection to any of the terminations.

PN63

THE DEPUTY PRESIDENT: Thank you. Anything further, Mr Saunders?

PN64

MR SAUNDERS: No, your Honour.

PN65

THE DEPUTY PRESIDENT: Having heard the submissions of both parties - that is, the consent given by the union to the residual coverage of these agreements - bearing in mind that a new federally registered enterprise agreement has been negotiated and approved by Fair Work Australia, I am satisfied that it is appropriate to terminate a number of enterprise agreements which I will outline in a short decision that I will issue in due course. I am satisfied that it would not be contrary to the public interest to terminate those agreements and I consider it appropriate to terminate them, taking into account the circumstances that have been described by Mr Saunders and recognised by Ms Hannan today.

PN66

Accordingly, I shall issue orders effective from today to terminate the following enterprise agreements: the Sydney Water Corporation Enterprise Agreement 2000; the Sydney Water Professional Engineers Safety Net Agreement 2002; the Sydney Water Corporation Holding Co Enterprise Agreement 1995; the Sydney Water Holding Co Enterprise Agreement 1997; the Sydney Water Corporation Professional Engineers Enterprise Agreement 2003; the Sydney Water Corporation Professional Engineers Safety Net Agreement 2004; the Sydney Water Corporation (Utilities Business) Professional Engineers Certified Agreement 1995; and the Sydney Water Corporation Ltd (Utilities Business) Professional Engineers Agreement 1997.

PN67

That order shall that effect on and from today's date. Can I just ask you, Mr Saunders, as a matter of interest, does the agreement relative to the Holding Co, is that the old company that you were talking about that was no longer in existence?

PN68

MR SAUNDERS: Yes. My understanding is that at some stage in the mists of time, Sydney Water was split up to form Sydney Water Corporation and another entity called Australian Water Technologies. As employees and assets were shuffled between those, eventually everything came into Sydney Water Corporation.

PN69

THE DEPUTY PRESIDENT: I see.

PN70

MR SAUNDERS: So we would be the successor of Sydney Water Corporation Holding - Corporation or whatever the precise name of that entity is.

PN71

THE DEPUTY PRESIDENT: When did that happen?

PN72

MR SAUNDERS: My understanding is 2001-2002.

PN73

THE DEPUTY PRESIDENT: I see. I only ask because I was on Sydney Water Corporation's Board when the AW2 was established.

PN74

MR SAUNDERS: Yes.

PN75

THE DEPUTY PRESIDENT: Thank you. The proceedings will be adjourned and concluded on that basis by the issue of the order that I've indicated. A short decision will be published in due course by the tribunal. I thank you both for your attendance today.

<ADJOURNED INDEFINITELY [10.47AM]