AG2017/605, Transcript of Proceedings [2017] FWCTrans 308 (28 July 2017)

TRANSCRIPT OF PROCEEDINGS
Fair Work Act 2009                                       1054918

COMMISSIONER LEE

AG2017/605

s.185 - Application for approval of a single-enterprise agreement

Application by AWD Civil Pty Ltd
(AG2017/605)

Melbourne

2.05 PM, WEDNESDAY, 12 JULY 2017

PN1

THE COMMISSIONER: Good afternoon, Mr Dorber. How are you?

PN2

MR C DORBER: Good afternoon, Commissioner.

PN3

THE COMMISSIONER: You can stay seated. That will be fine.

PN4

MR DORBER: Thank you, sir.

PN5

THE COMMISSIONER: The transcript won't have any trouble knowing who is speaking because it's just you and me. You're appointed bargaining representative for the applicant?

PN6

MR DORBER: I am, sir.

PN7

THE COMMISSIONER: Yes. On that basis you don't require permission to appear. This matter has been listed for hearing. It's been the subject of a significant amount of correspondence and you should have a copy of a summary document that was prepared.

PN8

MR DORBER: I do, yes.

PN9

THE COMMISSIONER: Essentially that's an effort to set out, if you like, the journey so far. The extent to which undertakings have been given which satisfy my concerns which were numerous, and they do satisfy a number of those concerns, but then also seeks to set out those matters that continue to be of concern, and of course notes at the end that I'm already sliding into the view that the level of extent of the undertakings are taking me to a place where it would seem to me difficult to conclude other than there are now substantial changes to the agreement, particularly given that further undertakings are required. But that's just a preliminary view.

PN10

So it's been listed today obviously to give you an opportunity to address me on all that, Mr Dorber, and it's over to you.

PN11

MR DORBER: Thank you, sir. I would just indicate by way of a capacity to address you at any level of professionalism is that I'm the managing director of employment, Advocacy Solutions Proprietary Limited, which operates under the trademark, Employer Protect and Contractor Protect. I've been involved in appearing before this Commission a little a bit over 40 years in one form or another, and have been responsible for writing many, many single enterprise agreements.

PN12

With great respect I must say that I have detected a change in the way many of these matters are now processed because quite a number of the matters that have been subject to undertakings have previously been approved by this Commission in many, many single enterprise agreements that we have done either in the civil and construction industry sector or more broadly amongst our employer subscription base. But I think in relation to your primary concern that are the number of undertakings getting to the point where perhaps you might be inclined to disallow the agreement because it's perhaps not clear enough, I would suggest, with respect, that I believe we can make sure that the employer clearly understands and the employee understands the obligations, in the event that you do approve the agreement, on the basis that we think many of the undertakings are self-explanatory.

PN13

Our practice is that after you've issued an approval we provide your approval document to the employer and we provide a second document, and in red, we insert into that document at the relevant clause the individual undertakings that have been made so that the employer who's then educated about the application of the agreement, in addition to having the original document you've approved, has a document that provides all of the material as it appears in the clauses in a manner that makes it very difficult for them not to be aware of those undertakings and how they operate.

PN14

I have had agreements approved with more undertakings but I'll concede not many more. I've had agreements not allowed with less undertakings, and in this particular case I'm hopeful that the way the concerns have been satisfied might mean that you would consider the manner in which we present the agreement to the employer could alleviate some of your concerns.

PN15

THE COMMISSIONER: I'll just clarify, to me, it's not necessarily – obviously the number of undertakings is a material factor in terms of substantial change, but it's not – you know, one might have a lesser number of undertakings but they have the effect of substantially altering the agreement. I mean, substantial change is the test, so it's not just about the number. It's not like if you shorten the number that somehow you sort of say it's less than 10, that's okay. It's really, you know, whether, when looking at the agreement, is it the same agreement that was voted on, and of course it's not the same, because some undertakings will have the effect of changing the agreement, but at some point, you know, we've substantially changed what was voted on.

PN16

MR DORBER: Yes. I accept that, your Honour. I was thinking of a classic example. It's the very first undertaking about redeployment. My understanding of the replacement and the new clause is that, in effect, and it is a practice permitted under the award, if I redeploy an employee to a position for which they're suitably skilled or qualified, after seven days I can currently, under the award, reduce their wage to the wage of the position to which I have redeployed as an alternative to a redundancy. And I would respectfully suggest that what we originally had was of a benefit to an employee because we actually guaranteed, notwithstanding the giving of seven days' notice, we would not reduce their wages for at least a period of one month from the date of transfer. So my respectful interpretation of that is we've taken the benefit away which surprises me.

PN17

THE COMMISSIONER: So you say that that – well, it's your undertaking. You say that I shouldn't accept that undertaking because it's detrimental?

PN18

MR DORBER: Well, I would want to make the point that the undertaking which you asked for would, I suggest with respect, disadvantage not advantage an employee because at the current time if I'm correct in my assertion after the seven days' notice if I redeploy as an alternative to redundancy I can drop your wages, or increase them, to the new position's rate. Then I would suggest that we've taken away that one month buffer, which I must admit I've never had disapproved by the Commission since 2009 when we started using this current model. But I do think it is an advantage; not a disadvantage.

PN19

THE COMMISSIONER: Yes. Okay. So I think taking it from those submissions on your first point the undertaking should never have been sought because there's actually nothing wrong with the current clause 20.1.

PN20

MR DORBER: That would be my submission, sir.

PN21

THE COMMISSIONER: Yes.

PN22

MR DORBER: And I've not managed this. One of my staff has, but I think perhaps – you know, if I was in charge I'd say to the Commission the old system we had where you came before a Commissioner and consulted we could eliminate these undertakings that are now required because, as you know, the old system we used to talk to Commissioners and iron out the problems long before we got to this formal stage. But I would be suggesting that to leave the undertaking in would represent a disadvantage to the employees.

PN23

THE COMMISSIONER: All right.

PN24

MR DORBER: If you would concede it I'd seek to certainly withdraw that providing you didn't form a view that I was wrong.

PN25

THE COMMISSIONER: Yes, I understand. No, I'll take that on board. It's best if you just run through what you want to submit, and I'll ‑ ‑ ‑

PN26

MR DORBER: Yes. Thank you, sir.

PN27

THE COMMISSIONER: ‑ ‑ ‑ obviously be making a decision about it subsequently.

PN28

MR DORBER: In relation to the summary in relation to the span of ordinary hours at point 3 of your document, sir, I've had this conversation with Mr Franken. The heading should always have been, Span of Operating Hours, which is in the agreement, or the agreements that we do solely for indicating to the readers of that document that the business hours of the business operate between that particular span. It should not have had a reference to ordinary hours in the heading. It should be span of operating hours.

PN29

So if paragraph 4 were to read "span of operating hours" which assists the workers to understand when the business is effectively open there would not create an inconsistency with clause 26.1 which deals more precisely with hours of work for different classes of employee. So 26 is dealing with actual ordinary hours of work and the consequences of working more. The definition of span of operating hours is intended to mean that's when the business is open for business ordinarily. Yes.

PN30

THE COMMISSIONER: So what does that mean? You've given me – this is all in reference to the undertaking number 4?

PN31

MR DORBER: Yes. Yes, so if that heading in the undertaking - so the undertaking could remain, but the heading would read, Span of Operating Hours.

PN32

THE COMMISSIONER: Right.

PN33

MR DORBER: Similarly then (a) and (b) would make sense because it's not suggested by the improper insertion of the word "ordinary" in the heading that somehow the span of operating hours attract ordinary hour rates of pay. That's a typographical error in the undertaking. It should have read "span of operating hours" and I believe that would address your concerns.

PN34

THE COMMISSIONER: Just a minute.

PN35

MR DORBER: In relation to ‑ ‑ ‑

PN36

THE COMMISSIONER: Hang on. Sorry, just wait a sec.

PN37

MR DORBER: Sorry.

PN38

THE COMMISSIONER: I understand.

PN39

MR DORBER: In relation to ‑ ‑ ‑

PN40

THE COMMISSIONER: So the undertaking remains exactly as is other than ‑ ‑ ‑

PN41

MR DORBER: The heading.

PN42

THE COMMISSIONER: ‑ ‑ ‑ the heading.

PN43

MR DORBER: So I'd note for example in relation to 4(b) for clerical employees that the Clerical Award of course allows ordinary hours to be worked on a Saturday between 7 and 12. That doesn't change in the agreement but it's not relevant to the span of operating hours.

PN44

THE COMMISSIONER: So you would also change in the first line the replacement in clause 6 of the definition of "span of ordinary hours" to ‑ ‑ ‑

PN45

MR DORBER: "Span of operating hours".

PN46

THE COMMISSIONER: Operating hours. So, we have to change it twice. Okay. Yes, understood.

PN47

MR DORBER: I understand there's an issue of – I'm just trying to get these correctly. Clerical employees' overtime, public holidays and weekend work; you addressed the question of clarity in the agreement, and I would say that what undertaking 11 makes clear is that it's payment for 1.25 hours for all ordinary hours worked on a Saturday, and I would suggest that the attraction of overtime flowing after those ordinary hours then of course means that the employees are effectively better off if you look at the schedule on page 50. I think you had a question about whether undertaking 11 met your requirements.

PN48

THE COMMISSIONER: Yes. So it's about the clarity and it was about whether or not – so if we go back to the span of what is now span of operating hours change.

PN49

MR DORBER: Yes.

PN50

THE COMMISSIONER: So ‑ ‑ ‑

PN51

MR DORBER: So although a clerical employee could work ordinary hours on a Saturday it would be quite uncommon in this business, but it's not part of their span of operating hours. So clearly even if they were known as ordinary hours because there was an averaging agreement or an individual flexibility agreement in place they would still attract any ordinary hours worked on a Saturday at 1.25 per cent rate, and then all others of course would be at the subsequent overtime rate.

PN52

THE COMMISSIONER: Yes. So the issue is we had span of operating hours is what we had in the agreement means Monday to Friday between 6 and 6, and now by virtue of your – I'm just explaining the concern. By virtue of the undertaking that we were discussing at undertaking 4, we now have a span for clerks from 7 to 12.30 on a Saturday for operating hours.

PN53

MR DORBER: Well, the undertaking in 4(b) was and is that "the span of operating hours for employees covered by the clerks" – "means Monday to Friday from 7 till 7 and on Saturday 7 till 12.30 which may be altered", but in effect even though they're ordinary hours on a Saturday they are paid at the 1.25 per cent rate as the award would normally require, and that's at the higher SEA rate, not the award rate.

PN54

THE COMMISSIONER: Yes.

PN55

MR DORBER: So they're no worse off.

PN56

THE COMMISSIONER: But it's a question of where we're coming from in terms of what's in the agreement, sir. The issue is ‑ ‑ ‑

PN57

MR DORBER: So the ‑ ‑ ‑

PN58

THE COMMISSIONER: I agree that they're now going to get paid at the rate of time-and-a-quarter consistent with that, but previously they would have got overtime rates as per schedule 1(3)(c) which are greater.

PN59

MR DORBER: Yes. We would have, at schedule 1, para 3, overtime, public holidays and weekend work, we had indicated that ordinary hours outside the span of – any hours worked outside the span of their ordinary hours which they're not subject to the definition that we just discussed. That's only operating hours of the business. So any work they do outside the span of ordinary hours as a clerical employee is effectively 150 per cent for the first two hours and then double time. That means that in effect they get the 1.25 per cent provision that is required for the first group of hours, and then they get the 150 and then the double time, so they're no worse off.

PN60

THE COMMISSIONER: Where's the definition – so to be frank, this is where I find it very confusing.

PN61

MR DORBER: Yes.

PN62

THE COMMISSIONER: So we're now moving back from operating hours, which we've been dealing with in terms of the undertaking in 4 ‑ ‑ ‑

PN63

MR DORBER: Yes.

PN64

THE COMMISSIONER: ‑ ‑ ‑ to a spread of hours.

PN65

MR DORBER: Well, the operating hours, with respect, just relate to the operating hours of the business and that's all it means.

PN66

THE COMMISSIONER: So it has no work to do then; is that right? In terms of regulating when overtime is paid?

PN67

MR DORBER: That's right. There's no connection between ‑ ‑ ‑

PN68

THE COMMISSIONER: I should ignore it?

PN69

MR DORBER: ‑ ‑ ‑ the span of operating hours of the business and the agreement's requirements concerning the payment of overtime. So that if I have reached an agreement with my employer that my ordinary hours I worked Tuesday to Saturday then my ordinary hours on a Saturday will attract a penalty, and the penalty is specified in schedule 1 clause 3. So anything outside of my ordinary hours, and my ordinary hours can include, under the Clerks Award, 25.1(b) ordinary hours between 7 and 12 – I think it's 12 or 12.30, on a Saturday. And so what we've said is all overtime is paid that's outside ordinary hours on a Saturday at 150 and then 200. So if it's all overtime on a Saturday, penalty applies as per schedule 1(3), and there doesn't need to be any discussion about ordinary hours because there aren't any. But if I have an agreement with my employer that my ordinary hours shall include some time on a Saturday, then I am required to pay a part of those ordinary hours at 125 per cent, and then the 150 kicks in. Do you see the difference?

PN70

THE COMMISSIONER: Pursuant to what do I have this agreement that you're talking about?

PN71

MR DORBER: What the agreement I suggest makes clear at schedule 1(3)(c) is that if I work any hours on a public holiday and/or weekend work then that work will be paid at 150 per cent of my ordinary rate for the first two hours then double time if they're not part of my ordinary hours.

PN72

THE COMMISSIONER: Yes.

PN73

MR DORBER: So I'm better off.

PN74

THE COMMISSIONER: Yes. So 1(3)(c). Schedule 1(3)(c).

PN75

MR DORBER: Yes. Yes.

PN76

THE COMMISSIONER: "Any hours worked outside the span of ordinary hours or in excess of eight hours per day shall be paid at 150 per cent for the first two hours and 200 per cent of the employee's ordinary ... thereafter". Yes. The overtime rate ‑ ‑ ‑

PN77

MR DORBER: Yes. So if I work Monday to Friday as a clerk and I come in on a Saturday all of my hours worked on a Saturday are at the schedule 1(3)(c) penalty rate. So I'm not in any way worse off.

PN78

THE COMMISSIONER: But this all turns on the span of ordinary hours. Where do I look to find the span of ordinary hours?

PN79

MR DORBER: I think if you go to 27, and clause 27 – sorry, clause 26. We'll do the full-time one. Sorry, sir. So it does say that full-time employees' ordinary hours are 38 per week, Monday to Saturday inclusive plus two reasonable additional hours when directed. So basically I can agree with my employer to do my ordinary hours during any of those six days ‑ ‑ ‑

PN80

THE COMMISSIONER: Yes. At any ‑ ‑ ‑

PN81

MR DORBER: ‑ ‑ ‑ and be paid my ordinary rates plus the two hours, so if I'm on a 40 hour week, which is the common practice in this business. Then I'm going to pay 38 ordinary hours, two hours at time-and-a-half for all of my ordinary hours, which we consider 40. But anything I do under the schedule on a Saturday attracts overtime because they're not my ordinary hours.

PN82

THE COMMISSIONER: Why wouldn't they be when 26.1 says your ordinary hours are 38 per week, Monday to Saturday?

PN83

MR DORBER: Because I'd have to have an agreement to that effect, and under the provisions of clause, I think it's, 8 of the agreement, it would've been spelt out. Employment Terms, clause 8, page 9 requires me to tell my employee in writing their hours of work, et cetera, et cetera, et cetera. So if I'm a 38 hour week employee, Monday to Friday, and my appointment letter says that, anything I do outside those hours will attract the overtime provided for in the schedule. That's certainly how we apply these agreements. Maybe they could be better written, but this is the first time this has come up as an issue, and we are looking at whether we can improve the wording.

PN84

THE COMMISSIONER: Yes. Well, that would be my suggestion. The ‑ ‑ ‑

PN85

MR DORBER: See, the way the agreement works, sir, is that that clause 26.1 sets my hours, which may include the two reasonable additional hours, and when you look at those and what the rate is under the SEA, which is $19.21 an hour at level 1, for example, that is higher than the award rate, and I'm not in any way penalised because at 26.2 any hours in 8 attract time-and-a-half and then double time. I would have been penalised if I was only on the minimum award rate.

PN86

I mean, I've been writing these agreements for a long time and I confess that it does get challenging trying to make it as simple in English terms as possible, but once we've got a clause that's been before the Commission on multiple occasions we generally stick to it in the hope that there won't be an issue again.

PN87

THE COMMISSIONER: Yes. It's best if you stop telling me that you've had it here on multiple occasions because, as an experienced practitioner, you would be well aware that the statutory obligation is a case by case approach.

PN88

MR DORBER: I acknowledge that. Of course.

PN89

THE COMMISSIONER: So your test is to satisfy me, and if you're not happy with what I decide then you have your rights to have it reviewed.

PN90

MR DORBER: No, I acknowledge that. I acknowledge that, sir.

PN91

THE COMMISSIONER: At the risk of, and we're both going to be guilty of this, restating things, but just again to be clear, the essence of what you're putting is that span of operating hours undertaking has no work to do because it entirely relates to the operating hours of the business.

PN92

MR DORBER: Yes, sir.

PN93

THE COMMISSIONER: But I should look for the span of ordinary hours which is in schedule 1(3)(c) where we've got any hours worked outside that span or in excess of eight hours per day attract a penalty rate, and outside of eight hours a day would seem reasonably straight forward but in terms of the span, the span is basically any time, Monday to Saturday, and then you took me to clause 8 where there's an agreement about hours of work.

PN94

MR DORBER: Yes.

PN95

THE COMMISSIONER: So I have to read all that together to understand when I would be paid outside of the span; is that right?

PN96

MR DORBER: Yes, it is. And if you looked at 26.3 it makes clear that all overtime on a Saturday is time-and-a-half for the first four hours and double time thereafter, so I think it does have to be read collectively to understand it. I accept that.

PN97

THE COMMISSIONER: Yes. Okay.

PN98

MR DORBER: I think you raised an issue of the aggregate rates of pay, building and construction employees. Undertaking 13, this is in quite some detail, we would have thought would make that clear, and is inserted on to page 56 of the SEA. It doesn't replace any clause or provision, but the intention or the interpretation of the rates at schedule 2 ‑ ‑ ‑

PN99

THE COMMISSIONER: Yes.

PN100

MR DORBER: ‑ ‑ ‑ what it demonstrates is that the actual SEA weekly ‑ ‑ ‑

PN101

THE COMMISSIONER: Sorry. Just hang on. Just a sec, just let me find schedule 2.

PN102

MR DORBER: Sorry. Page 56.

PN103

THE COMMISSIONER: Yes, got it.

PN104

MR DORBER: So the idea is firstly the business operates and pays its staff for 40 hours, and what the table makes clear is it's the award hourly rate, the industry allowance, the special allowance, the leave loading all added together, the additional two hours so that at 40 hours you're getting your $862.10. We then ‑ ‑ ‑

PN105

THE COMMISSIONER: At the bottom, yes.

PN106

MR DORBER: ‑ ‑ ‑ have loaded that with $5, so the last column becomes the SEA weekly rate.

PN107

THE COMMISSIONER: Yes.

PN108

MR DORBER: In every instance, whether it's 38, 40 or 50 hours, the hourly rate is always higher than the modern award equivalent taking into account each of the provisions in the table. The aggregate rate doesn't in any way disadvantage any employee nor does it disadvantage any casual and indeed we've made an undertaking, I understand, about casuals that the SEA rate will be calculated for their 25 per cent, so they're even better off again. So undertaking 15, for example, is particularly beneficial for casuals because the normal practice, not in this agreement, it stands alone, as you've rightly pointed out, in the normal practice casual employees under SEAs that we write get the award rate plus 25 per cent. But there's been an undertaking made here, which the employer has signed, that a casual employee will get the full SEA rate, in other words, the loaded SEA rate with the $5 plus the 25 per cent. So they're clearly better off overall than when compared to the modern award.

PN109

THE COMMISSIONER: Let's go back to undertaking 13. So the issue with that was, as you saw in the summary I provided, it's not clear ‑ ‑ ‑

PN110

MR DORBER: Yes. The advice I have is it's to be read in conjunction with part 10 schedule 2, and would be inserted into the agreement, as I mentioned earlier, that we issue when you've approved the matter immediately after page 56, so that it becomes the explanatory note in effect for those rates. It doesn't replace anything. It just makes clearer, hopefully to your satisfaction, the interpretation of aggregate rates and the like.

PN111

So that if, in effect, the schedule 2 pay rates will not just have the rates, but it will make absolutely clear by being added as an addendum undertaking 13 what penalties are listed in that undertaking; 13(d) for example sets out the five terms that we think clarifies aggregate rates. So no one would be in any doubt that if they were on whatever aggregate rate they were getting, that they would then be entitled to the benefits of 13(d) in particular, and the five sub-provisions therein. I would suggest that the application of that to an aggregate SEA rate clearly makes every employee subject to those provisions in schedule 2 better off overall than the award.

PN112

THE COMMISSIONER: Depending on how we understand them that's quite possibly right. But the query I've got ‑ ‑ ‑

PN113

MR DORBER: If I could give you an – yes.

PN114

THE COMMISSIONER: Yes. Yes, maybe if you're going to give me an example.

PN115

MR DORBER: If I gave you an example, under schedule 2, if I'm classified as a 50 hour aggregate rate employee ‑ ‑ ‑

PN116

THE COMMISSIONER: Yes.

PN117

MR DORBER: Bottom of page 56, then my hourly rate at CW1A, in this case, would be $25.66. When you do the math the Excel spreadsheet that's an aggregate of all of the ordinary penalty rate hours, allowances and the SEA loading, and that 25.66 rate will apply for my first 50 hours and then by the insertion of that undertaking it's made clear that any work performed on the Saturday or Sunday is subject to 13(d)(i), (ii), (iii) and (v). I would suggest that by using that $25.66 hourly rate they're better off.

PN118

THE COMMISSIONER: Let me stop you there. It says, "all work performed on a Saturday or Sunday" if it's overtime. What I can't reconcile is when does the overtime provision kick in, and then what's it applied to?

PN119

MR DORBER: Yes. It kicks in on the fifty-first hour. So the normal practice in the civil sector for this employer is that those employees doing 50 hours, they do it Monday to Friday.

PN120

THE COMMISSIONER: Yes.

PN121

MR DORBER: They do 10 hours a day.

PN122

THE COMMISSIONER: Yes. But they could work, under the way this is applied, they could work part of their 50 hours at the SEA hourly rate on a Saturday or a Sunday provided it was within the 50 hours; is that right?

PN123

MR DORBER: That's certainly not – well, those 50 hours – I guess owing to the language I suppose, because we pay an employee 50 hours, which we call their ordinary hours, for example ‑ ‑ ‑

PN124

THE COMMISSIONER: Yes.

PN125

MR DORBER: ‑ ‑ ‑ and that attracts the other penalties like superannuation and the like in the agreement. Then any hours over the 50 ordinary hours, so if I've got an individual flexibility agreement to do my ordinary hours Tuesday to Saturday for example ‑ ‑ ‑

PN126

THE COMMISSIONER: Forget about individual flexibility agreements.

PN127

MR DORBER: Okay. Well, all overtime kicks in on the fifty-first hour under the 50 or the 38 or the 40, depending on what your letter of appointment says you work.

PN128

THE COMMISSIONER: All right. I'll ask the question again because I didn't really get a clear answer. If as long as I – and it might be just the way you answered it and not my understanding of what you're saying, and I'm sorry if that's the case, but what I hear you saying is that if I worked over 50 hours you start getting overtime rates. That much I've got clear.

PN129

MR DORBER: Yes.

PN130

THE COMMISSIONER: But I can work being paid, using our example of $25.66 an hour, up to 50 hours on any day of the week including Saturday or Sunday; is that right? That's the effect of how I read together your proposed undertaking with schedule 2.

PN131

MR DORBER: Yes. That would be correct. Yes. That would be correct.

PN132

THE COMMISSIONER: Okay.

PN133

MR DORBER: You raised a question, sir, about shift work.

PN134

THE COMMISSIONER: Yes.

PN135

MR DORBER: Not providing shift penalties for clerical employees. The employer has three clerical employees who do not do any shift work and would not be required to do any, but if you require an undertaking that if any shift work provisions were introduced they would be subject to the provisions of the relevant award, well, we'd be happy to do that. But historically, and it's never intended that clerical employees by this employer shall do shift work. It's not common in this industry sector.

PN136

THE COMMISSIONER: Don't get me wrong, I'm sure that that's probably right, but again that's not how we assess it. It's always about what can be done; not what might be done. It's a question of what the rights or entitlements are.

PN137

MR DORBER: Yes.

PN138

THE COMMISSIONER: As I say to all employers, look, if you don't expect to employ anyone and it doesn't cause you any hardship, it would be a matter of providing an undertaking that would provide shift penalties for them as per the award provisions.

PN139

MR DORBER: No. Yes. Indeed we advise all employers that if a single enterprise agreement is in place notwithstanding the effective expunging of the relevant modern award, if there's a provision in that modern award, like shift work for example, and it's not in this agreement, then they are bound to comply with the shift work provisions of that award, but there's no difficulty making the undertaking; should it ever be introduced it will be at the relevant award rate specified in the relevant award or find some proper form of words.

PN140

THE COMMISSIONER: Yes. All right. So you're prepared to provide an undertaking along those lines?

PN141

MR DORBER: Yes, sir.

PN142

THE COMMISSIONER: Yes.

PN143

MR DORBER: Yes. Annualised salaries; if anything has ever caused me a heart ache, this has got to be the one. What ‑ ‑ ‑

PN144

THE COMMISSIONER: I'll just say this is a fine issue. This is not the matter that's going to cause the agreement to hit the reef.

PN145

MR DORBER: No.

PN146

THE COMMISSIONER: It's just that well, look, arguably to the extent that there is such a clause similar to the one that I had you take out in respect of construction employees, there is one in respect of clerical employees, so one could say well, they had the benefit of that. It is in the award. To that extent it is not beneficial but I ‑ ‑ ‑

PN147

MR DORBER: But, I mean, with great respect, I don't understand why it's relevant whether it's in the award or not. It's a statutory provision in the Act. Section 330 provides for annualised salaries, and this is in every agreement – sorry, all the agreements I've ever done refer to section 330 of the Act, and it's provided for by legislation. Until this matter the only issues I've ever had with Commissions have been proposals like fortnightly audits and stuff like that which is completely unworkable and insane. But how you audit someone's salary after two weeks I do not know. But in this particular case, sir, if the Act prescribes the right to an annualised salary what relevance is it whether it's in the award or not. Does not the Act prevail?

PN148

THE COMMISSIONER: What you referred me to is an undertaking that can be given by an employer to an employee if they're covered by a modern award.

PN149

MR DORBER: Yes. I'd also say, with respect, that annualised salaries can clearly be – you can be better off overall. The absence of a reference to an annualised salary in the modern award, and then you introduce it, I would like to think that there's an argument that that's a better off test; not a worse off test.

PN150

THE COMMISSIONER: It depends on whether or not ‑ ‑ ‑

PN151

MR DORBER: Provided we comply with the audit requirements retrospectively.

PN152

THE COMMISSIONER: Yes. There's been a recent decision which has dealt with an auditing issue, but let's just not go there. In any case ‑ ‑ ‑

PN153

MR DORBER: Yes, I saw that.

PN154

THE COMMISSIONER: ‑ ‑ ‑ we're really just – you've given an undertaking that clause 21.4 to 21.8 won't apply. My concern about that, just to restate it, was it is a BOOT issue to the extent that I just don't know. They may well be better off under the terms of that, but I just don't know. But in any case, I think we can dispense with the item under 5. I don't press that point to you. We'll leave that as it is, that is, I've accepted the undertaking already that clauses 21.4 to 21.8 will not apply.

PN155

MR DORBER: Thank you. In relation to the public holiday rates matter that you raise, we can make undertakings that the employer does not, will not, and has not worked on public holidays, and that should they do that then the loading prescribed in clause 37.9 of the award would apply.

PN156

THE COMMISSIONER: So you will provide an undertaking?

PN157

MR DORBER: Yes, sir.

PN158

THE COMMISSIONER: Then casual employees?

PN159

MR DORBER: My response to that was that your comment and your further review is correct, and that – trying to – the award casual rates are correct, that is, the award full-time rate plus 25 per cent, which is – so the undertaking is that, 15, is that the casual will be paid the full SEA rate plus the 25 per cent, and not any other rate listed in the agreement. You made a comment about what rates they would get particularly for 40 and 50 hour aggregate rates. We've ‑ ‑ ‑

PN160

THE COMMISSIONER: The SEA rate is the aggregate rate, isn't it?

PN161

MR DORBER: Yes, it is. We've applied the SEA rate to casuals even though there's a built in component for the annual leave loading, for example, in that rate which they wouldn't ordinarily get. So the rate on page 57 of the agreement applies to construction workers only, and that casual rate, we would suggest, is not able to be interpreted as being less than the rate that would apply under the modern award for a casual working those hours. Noting that, for example, the current modern award casual rate is $23.26 for a level CW1A and the SEA hourly rate, based on them doing either 38, 40 or 50 is higher than the translated rate they would get under the modern award.

PN162

THE COMMISSIONER: Okay.

PN163

MR DORBER: So they can't be worse off because they're getting more than the award would allow them to get ordinarily. Not significantly more, but if you looked at a CW6 40 hours, for example, sir, on page 57, the aggregate hourly rate consisting of the casual rate and the special allowances and the additional two hours is $29.72, but we pay them $29.84. It's higher than the modern award requirement, and these are not massively great rates higher, but they're higher.

PN164

THE COMMISSIONER: So just let me understand again your undertaking at 15. Casual employees would receive the full time SEA rate ‑ ‑ ‑

PN165

MR DORBER: Yes.

PN166

THE COMMISSIONER: ‑ ‑ ‑ specified for the position they fill.

PN167

MR DORBER: Plus the 25 per cent, yes. We would say clearly that slightly, but modestly in the hour, but in the aggregate they're better off, or we would submit that anyway.

PN168

THE COMMISSIONER: Yes. Just let me find the – where are the clerical rates? Here we go.

PN169

MR DORBER: Sorry, I missed what you said, sir.

PN170

THE COMMISSIONER: It's okay. How do I apply undertaking 15 to building and construction employees?

PN171

MR DORBER: Well, it says effectively all casual employees are subject to the full-time SEA rate plus the 25 per cent per hour, so that would be for both schedules; all of the schedules in the agreement for casuals. So the casual rate certainly for clerks and building and construction is applied to the SEA weekly rate, which is higher than the aggregate modern award equivalent rate.

PN172

THE COMMISSIONER: Okay. We covered the matters I've raised. I'll apologise for this one, because I didn't raise this in the correspondence, but I just want to go back to shift work definition to save me dredging up a copy of the relevant award, but:

PN173

Continuous shift worker means an employee who goes to work in a system of consecutive shifts throughout the 24 hours –

PN174

Blah, blah, blah. That's consistent with what's in the award, is it?

PN175

MR DORBER: Yes, it is. It's an exact copy.

PN176

THE COMMISSIONER: All right. Then there's the issue about – so we've got another two undertakings proffered. If you can send those to me? There's then that broad issue about the extent to which the number of undertakings and the way they interact has actually substantially changed the agreement. We talked a bit about that. You made some statements about that when we started, but ‑ ‑ ‑

PN177

MR DORBER: Yes. May I make one comment about that? That ‑ ‑ ‑

PN178

THE COMMISSIONER: Make as many comments as you like.

PN179

MR DORBER: Only contextually. This particular agreement, as are all the agreements that we prepare, as you can see, has a lot of stuff in it, and I've never had a chance to tell a Commissioner this, so I'm going to take advantage of this moment. My experience over 40 years is that many, many employers have no clue, and that the more I can put into these agreements that are mutually obligatory obligations the less the prospect that my clients will have of falling fowl of a breach of the award with the Fair Work Ombudsman or this honourable Commission.

PN180

It deeply frustrates me that so many agreements I see that are approved are miniscule but the whole purpose of this agreement for this employer is to ensure that this modest employer understands its obligations properly in every aspect, and we have 400 employer clients and 92 agreements and they all suffer the pain of that presentation from me that one day they might amend the legislation so that more employers actually write down their genuine obligations and obey them.

PN181

I'm dealing with a matter at the moment where a client elected to ignore a single enterprise agreement written in this manner and I said, "Well, you just negotiated settlement because you're not going to get away with it in any forum. They're going to point at it and say, 'Well, hey there it is in black and white'". So I accept that this is a relatively more complicated agreement than many that might come before you, but I do believe that even with the undertakings what it does is not significantly alter the intent of this agreement but improve the interpretation of it and, on that basis, and the fact that there are no identified detriments to an employee I would respectfully ask that with those undertakings you would approve the agreement.

PN182

THE COMMISSIONER: Thank you for that. If you can supply the additional undertakings that you proffered, which you did in general terms, and obviously you'll need to draft those.

PN183

MR DORBER: Yes.

PN184

THE COMMISSIONER: If you send those. What's a timeframe that is okay for you? By the end of the week?

PN185

MR DORBER: Yes. And I'm probably going to have to get a copy of the transcript to remember exactly the promises I made in proper terms, but if that's relatively quick to obtain, then within 24 hours.

PN186

THE COMMISSIONER: We can get a speedy one. We can get a speedy transcript.

PN187

MR DORBER: Yes. I would have the undertaking within two business days of receipt of transcript.

PN188

THE COMMISSIONER: Very well. That's fine. Then once I've received those I will consider the matter and issue a decision in due course. Okay?

PN189

MR DORBER: Thank you, Commissioner.

PN190

THE COMMISSIONER: Thanks very much. The Commission is adjourned.

PN191

MR DORBER: Thank you, sir.

ADJOURNED INDEFINITELY                                                           [2.59 PM]