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AG2010/ 1111 , Transcript of Proceedings [2010] FWATrans 1657 (15 November 2010)

TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009 29377-1

SENIOR DEPUTY PRESIDENT KAUFMAN

AG2010/ 1111  AG2010/1109

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

Application by Luxor Function Centre (Vic) Pty Ltd
(AG2010/ 1111 )



Melbourne

10.04 AM, MONDAY, 1 NOVEMBER 2010

PN1

THE SENIOR DEPUTY PRESIDENT: I'll take the appearances, please?

PN2

MR G PARKES: Your Honour, Parkes, initial G, appearing on behalf of the Restaurant and Catering Association, and our member Lakeside Banquet and Convention Centre.

PN3

THE SENIOR DEPUTY PRESIDENT: Yes, thank you. Mr Parkes, I've called this matter on because I just need a little bit of assurance that it meets all of the requirements of the legislation. A letter was written on 13 September - was it by you? Yes, by you, in response to some queries that had been made of your member. I'd like you just to take me through that and explain it to me - explain to me why I should approve the agreement.

PN4

MR PARKES: Thank you, your Honour. Basically, with that correspondence, dated 13 September, the member, Lakeside Banquet and Convention Centre has included a number of undertakings, and those undertakings have been specifically addressed to cater for some of the issues that were identified in the correspondence that we had received. We have indicated that the - or we have provided you with the notice of representational rights form that was actually circulated to employees.

PN5

THE SENIOR DEPUTY PRESIDENT: And that does seem to comply with the Act, doesn't it?

PN6

MR PARKES: Yes.

PN7

THE SENIOR DEPUTY PRESIDENT: Yes, so that's all right. Yes.

PN8

MR PARKES: A revised nominated date of expiry, being 30 June 2014, ensure that there's not a period going over the four years - - -

PN9

THE SENIOR DEPUTY PRESIDENT: Yes, that's - - -

PN10

MR PARKES: - - - the legislation.

PN11

THE SENIOR DEPUTY PRESIDENT: Yes. That will be acceptable, yes.

PN12

MR PARKES: We've also gone to the extent of making it clearer in relation to the National Employment Standards that where any term may be considered less beneficial that the National Employment Standards shall prevail. There is a provision already in the agreement that talks about that but I think there's some kind of further clarification required. So that has been given in an undertaking by the actual company.

PN13

THE SENIOR DEPUTY PRESIDENT: Yes. Thank you. That's the last attachment. Yes, yes. Yes, that's undertaking number 2, that should be all right. Yes.

PN14

MR PARKES: Thank you.

PN15

THE SENIOR DEPUTY PRESIDENT: Yes, I'll accept that.

PN16

MR PARKES: Thank you. Then there is also an arrangement where I think there was an issue regarding the better off overall test in relation to individual flexibility arrangements and again if you look at the attachment in the agreement, it did have the reference to food but just to make sure again there's been an undertaking in relation to that that wouldn't meet a no disadvantage test which I think was the concern of the preliminary assessment that was provided.

PN17

THE SENIOR DEPUTY PRESIDENT: Yes, what clause in the agreement deals with individual flexibility arrangements? It must have been in that clause that the - - -

PN18

MR PARKES: Yes, your Honour, I think the clause that there was no reference to the boot test in that clause.

PN19

THE SENIOR DEPUTY PRESIDENT: Yes, I'm just trying to find the clause.

PN20

MR PARKES: I'm doing that myself. Your Honour, it's 4.11, individual flexibility arrangements.

PN21

THE SENIOR DEPUTY PRESIDENT: Thank you.

PN22

MR PARKES: And then if I could refer you to attachment 4 of the agreement, and you can see in the second column it actually makes reference to the boot test.

PN23

THE SENIOR DEPUTY PRESIDENT: Yes. I'm just trying to see why it was a problem. Yes, because 4.11.3(b) said it won't disadvantage rather than making it - - -

PN24

MR PARKES: Yes. Just to make absolutely clear that that was not intention.

PN25

THE SENIOR DEPUTY PRESIDENT: Yes.

PN26

MR PARKES: It was always the boot test as per the template for the individual flexibility arrangement, a further undertaking has been provided.

PN27

THE SENIOR DEPUTY PRESIDENT: Yes. That's attachment 4, is it?

PN28

MR PARKES: Yes, attachment 4 has the template, and I just point out that it does make mention of the boot test there.

PN29

THE SENIOR DEPUTY PRESIDENT: Yes, yes. Well, that undertaking puts that beyond doubt. That's undertaking number 3, yes. Okay. The next one is the casual employees. What was the issue there?

PN30

MR PARKES: Yes, the - in respect to casual employees I think there was a concern that it would be possible to roster casual employees solely on weekends and although that would be, you know, a hypothetical situation because of these employees work on a number of shifts during the weekends, but just to make sure that if there were employees that worked solely on weekends there would be an additional loading applicable to them so that they would not be worse off compared to the award.

PN31

THE SENIOR DEPUTY PRESIDENT: Yes. And the - and if they're not rostered solely on weekends then that issue doesn't arise, is that correct?

PN32

MR PARKES: Well, what happens then is that the loaded rates take care of what they would be normally getting under the award. So the loaded rates still provide that they're better off overall with all the other benefits of the agreement. But that's my understanding of what the concern was, so we addressed that by providing an additional - - -

PN33

THE SENIOR DEPUTY PRESIDENT: Yes.

PN34

MR PARKES: - - - loading for those casual employees in those circumstances.

PN35

THE SENIOR DEPUTY PRESIDENT: Yes. Well, I'll accept that undertaking in relation to casual employees. Now, in paragraph 1(f) of your letter of 13 September, you were somewhat critical of the internal assessment. I do take umbrage with your suggestion that the assessment team deliberately biased anything. What it does is try to assess the agreement against the award to ensure that the boot test is passed, and it must take the worst scenario from the agreement's point of view to undertake that exercise. So I'll defend the team. It's not biased, nor did it bungle the assessment although it may have misconstrued a date. But satisfy me now as to the boot test, would you?

PN36

MR PARKES: Yes. Your Honour, this assessment process is new to us. We - - -

PN37

THE SENIOR DEPUTY PRESIDENT: It's new to everybody, Mr Parkes?

PN38

MR PARKES: Yes, I make the point we haven't had this occur with other agreements that have been lodged, so I think that's why I was somewhat critical because of the nature of the assessment and it's secret form which we - - -

PN39

THE SENIOR DEPUTY PRESIDENT: And it's what?

PN40

MR PARKES: It's secret form?

PN41

THE SENIOR DEPUTY PRESIDENT: Secret form?

PN42

MR PARKES: Yes.

PN43

THE SENIOR DEPUTY PRESIDENT: What do you mean by that?

PN44

MR PARKES: Well, the assessment that was provided to us was stamped as being secret, and the Tribunal being a transparent Tribunal we have concerns about what, you know, was the nature of the document if it's in that secret status.

PN45

THE SENIOR DEPUTY PRESIDENT: Could you show me the document that was provided to you? I don't understand that - what - because of the desirability of transparency, I make a point of providing the assessments to the parties so that they may be able to see what has been said. I see, somebody - was that you? I think somebody in my Chambers, who was assisting me, stamped the word "Secret" over the name of the person who prepared the report, that's all. The report is not secret. The - that stamp is unfortunate.

PN46

On my instructions the name of the person who prepared the assessment was blanked out and the assessment was provided to you, or to your member. There's nothing secret about it. I don't think it's necessary that the name of the officer in the - in Fair Work Australia who prepares the assessment need be provided to the parties. It's the report that needs be provided. So that's the extent of the secrecy. The word stamp "Secret" is a misnomer. The report is certainly not secret.

PN47

MR PARKES: I - - -

PN48

THE SENIOR DEPUTY PRESIDENT: And as I say, I make a habit of providing the - when we have an agreement that it's not clear as to whether or not it passes the boot test, we send it to - my practice is to send it to an internal assessment team within Fair Work Australia who are more expert at making these comparisons than I am, and they provide me with a report. And if it clearly passes the boot test I accept that report and all other things being satisfactory I will approve an agreement if on the - in the opinion of the assessment team it appears that the boot test may not be passed, I then - my practice - and I'm only speaking of myself, is to provide that assessment to the parties so that they can address me on it. I think that deals with the question of transparency. That's why I do it to be transparent.

PN49

MR PARKES: Yes.

PN50

THE SENIOR DEPUTY PRESIDENT: And that's what appeared on this occasion.

PN51

MR PARKES: Your Honour, I just made the point so that you understood why I was highly critical of the assessment process, because it appears it is a new process that's been adopted. We would certainly take a view that, perhaps, we should be able to have dialogue with the author of such reports, particularly, where we disagree with elements of it. So I'm not sure how we progress that because that seems like a policy and process issue.

PN52

THE SENIOR DEPUTY PRESIDENT: If this occurs in the future you can do it from my Chambers if it's an agreement with which I'm concerned.

PN53

MR PARKES: Okay. Okay.

PN54

THE SENIOR DEPUTY PRESIDENT: That's the way that that can be dealt with.

PN55

MR PARKES: Yes.

PN56

THE SENIOR DEPUTY PRESIDENT: Ultimately, it's a matter for me as you no doubt appreciate. And this is an internal process that's used to assist me to make the decision. So it's appropriate that any correspondence goes through my Chambers, but there's certainly no secrecy and there's certainly no inhibition on
any party making inquiries or querying the manner in which the calculation is performed.

PN57

MR PARKES: Yes, your Honour. However, I did, you know, email your Chambers as ask for the author of the report to have that dialogue and I was, you know, told that wasn't to be available. So we - what I'm saying - - -

PN58

THE SENIOR DEPUTY PRESIDENT: Yes, but any questions could have gone through my Chambers to the author of that report - - -

PN59

MR PARKES: I see what you're saying. So it can be a conduit to that - - -

PN60

THE SENIOR DEPUTY PRESIDENT: Yes.

PN61

MR PARKES: - - - to that - - -

PN62

THE SENIOR DEPUTY PRESIDENT: Yes.

PN63

MR PARKES: I still do not understand why there can't be direct contact with the enterprise agreement, your Honour?

PN64

THE SENIOR DEPUTY PRESIDENT: Well, as far as I'm concerned it's just not appropriate. And I'm only speaking for myself.

PN65

MR PARKES: Okay.

PN66

THE SENIOR DEPUTY PRESIDENT: These are internal assessments to assist me and anything that - any communication ought to be done via my Chambers so that I know what's going on.

PN67

MR PARKES: Okay. Thank you, your Honour.

PN68

THE SENIOR DEPUTY PRESIDENT: Other members may have different views. Any rate, now, let's get back to it. So explain to me why the agreement passes the boot test?

PN69

MR PARKES: So, your Honour, the main point that I'd like to make is that this is a comprehensive package that has been put together for the employees of this company. The whole concept of enterprise bargaining is that there are offsets for employers and there are benefits for employees. There are a number of benefits for employees here with loaded rates, with paid breaks, with also meals being provided, so there's a package of benefits that the employees have democratically voted and agreed to. We see the package as being something that should be approved by the Tribunal and with the undertakings we can't see that there should be any reason why it should be rejected.

PN70

THE SENIOR DEPUTY PRESIDENT: Yes, yes, I understand that in a global sense. Now, you need to take me to those elements to which you refer.

PN71

MR PARKES: So if I may refer you to the table that we provided to you in the correspondence of 13 September, we have an analysis there of the agreement provisions compared to the award. And you can see that an indicative example with the agreement provision of the hourly rate of $16.73 an hour, and we've given a shift on a Saturday, overall including the paid rest breaks the employee would be better off significantly under the agreement compared to the award.

PN72

THE SENIOR DEPUTY PRESIDENT: $653 as opposed to $646.

PN73

MR PARKES: Correct, correct. So again that's what we're indicating with the package that we've provided with this agreement.

PN74

THE SENIOR DEPUTY PRESIDENT: Now, what's the $16.73 - that's the rate for whom? For what classification?

PN75

MR PARKES: Yes. So that is streamed to - - -

PN76

THE SENIOR DEPUTY PRESIDENT: Where do I find this in the agreement? That's a Monday to Saturday employee?

PN77

MR PARKES: Yes, that's right, your Honour.

PN78

THE SENIOR DEPUTY PRESIDENT: Yes. I've got that, yes.

PN79

MR PARKES: So, yes, so what we're saying is that we can, you know, clearly demonstrate that employees would be better off under the terms of the agreement. So, therefore, we're seeking approval from you today, your Honour.

PN80

THE SENIOR DEPUTY PRESIDENT: Yes. How does that operate in relation to a stream 3 employee? The assessment team made a comparison there that suggested that such an employee would be approximately 2 and a half per cent worse off as compared with the award. Have you done that calculation, Mr Parkes?

PN81

MR PARKES: Your Honour, we could provide that table to you, you know, to demonstrate how, again, employees are better off, but it needs to match up like for like so that when you are talking about annual leave loading being applicable to the employees under the award it needs to also be offset by the annual leave loaded rate so the employees are getting more as far as their annual leave under the load rates when they actually take leave. So we've - - -

PN82

THE SENIOR DEPUTY PRESIDENT: Just explain that to me. Go back to your table and your letter if you would - - -

PN83

MR PARKES: Yes.

PN84

THE SENIOR DEPUTY PRESIDENT: - - - and you assert that the assessment team didn't include the annual leave at the loaded rate. Just explain to me that calculation if you would?

PN85

MR PARKES: Yes. So what we've done there is we've actually taken into account that under the enterprise agreement the employee would be receiving their four weeks annual leave at a higher rate. So in that example with the stream 2, it's $1.32 an hour, you know, which is higher than the award rate.

PN86

THE SENIOR DEPUTY PRESIDENT: And the amount of $4.18 is for - the difference there, is it?

PN87

MR PARKES: Yes, yes. So it's extrapolated to give you then a weekly equivalent of what - how they would be better off when they actually took their annual leave over that four week period. So that should also be taken into consideration when you do a like for like comparison: the agreement compared to the award.

PN88

THE SENIOR DEPUTY PRESIDENT: Does that mean that that table that you've put in there is what an employee would earn whilst that employee is on annual leave?

PN89

MR PARKES: No, no, because if that was the case it would be 52 weeks, and you can see there we've calculated that at 48. So to give the figure less what they would actually be on when they're on their annual leave, but to - - -

PN90

THE SENIOR DEPUTY PRESIDENT: So you're adding that $1.32 to every hour that employee works while that employee works?

PN91

MR PARKES: Yes. And - - -

PN92

THE SENIOR DEPUTY PRESIDENT: Just explain to me why you are able to do that?

PN93

MR PARKES: Because if you calculate $152 hours, which is equivalent to four weeks annual leave - - -

PN94

THE SENIOR DEPUTY PRESIDENT: Yes.

PN95

MR PARKES: - - - and $1.32 you would get a figure then divide that by 48 which is giving you $4.18 per week that they would be better off.

PN96

THE SENIOR DEPUTY PRESIDENT: What clause in the agreement do I need to look at?

PN97

MR PARKES: Well, there is no provision in the agreement. It is highlighting again one of the benefits of being engaged under the agreement because you're getting the loaded rates.

PN98

THE SENIOR DEPUTY PRESIDENT: So $16.73 an hour, $1.32 an hour over the award rate, is it?

PN99

MR PARKES: Correct.

PN100

THE SENIOR DEPUTY PRESIDENT: So every hour worked that employee gets $1.32 more including when that employee is on annual leave.

PN101

MR PARKES: Correct. But for the period of the leave they would, you know, under the award they would not be getting that $1.32 per hour. So if you multiply that by 152 hours, which is the four weeks - - -

PN102

THE SENIOR DEPUTY PRESIDENT: Yes.

PN103

MR PARKES: - - - and then divide that by 48 you get the weekly benefit for comparison purposes. The employee wouldn't get $4.18 per week in their pay packet - - -

PN104

THE SENIOR DEPUTY PRESIDENT: No, no, it's additional - - -

PN105

MR PARKES: - - - it's provided - yes, to show a benefit overall when you take into consideration the loaded rates for when they're on annual leave.

PN106

THE SENIOR DEPUTY PRESIDENT: But if you compare that with the assessment by the internal assessment, that resulted in a diminution by 1.64 per cent per week. Now, I'm just thinking that this is going to look rather odd on the transcript this sort of conversation.

PN107

MR PARKES: Yes.

PN108

THE SENIOR DEPUTY PRESIDENT: We might just go off the record while we're dealing with these calculations while you're trying to assist my feeble mind.

OFF THE RECORD [10.26AM]
ON THE RECORD [10.35AM]

PN109

THE SENIOR DEPUTY PRESIDENT: Yes, I'm joining these two matters, Mr Parkes, you appear in both of them. We've had some discussions both on and off the record and off the record I indicated to you that I'm prepared to accept the undertakings in relation to each of the agreements and you've said that you will provide updated rates to take into account the last minimum wage increase affect on the agreement. I will send those to the assessment team and if the assessment team agrees with you that the boot test is passed or satisfied I will approve each agreement. If there is a problem a dialogue will ensure and I undertake that I will deal with this matter as rapidly as I'm able to.

PN110

MR PARKES: Thank you, your Honour.

PN111

THE SENIOR DEPUTY PRESIDENT: Yes, thank you, Mr Parkes. We'll adjourn now.

<ADJOURNED INDEFINITELY [10.36AM