T19 and T20
IN THE TASMANIAN INDUSTRIAL COMMISSION Decision Appealed - See T194 and T196 Industrial Relations Act 1984
INTRODUCTION Applications T19 and T20 of 1985, made by the Federated Miscellaneous Workers' Union of Australia, Tasmanian Branch, (F.M.W.U.) and the Australian Social Welfare Union, Tasmanian Branch, (A.S.W.U.) were filed with the Registrar on 25 January, 1985. The applications were referred to me and initial proceedings commenced on 21 February, 1985 and concluded on 16 May, 1985. At the outset, Mr. O'Brien for the F.M.W.U. stated that the applications sought only to have an award made, the "Community Services Award", in the same terms as that which was made by the Community Services Industrial Board, and which was to operate from 1 April, 1985. It is important to indicate that the award made by the Community Services Industrial Board did not carry forward as an award of the Tasmanian Industrial Commission, as the award made by the Board was not in force as at 1 January, 1985, the date of commencement of the Tasmanian Industrial Commission. Accordingly the transitional provisions contained in the Tasmanian Industrial Relations Act, 1984 did not apply to carry forward that award as an award of this Commission. Notwithstanding these particular circumstances, the Association of Christian Care Agencies (A.C.C.A.) had always reserved their rights to argue for exemption from any proposed new Community Services Award. It was therefore not surprising that when applications T19 and T20 came to be heard by me, Mr. Fitzgerald, representing A.C.C.A., sought to have determined as a preliminary point the question of exemption of A.C.C.A. agencies from the proposed award which it was requested that I make. Exemption was sought for the following agencies; Hobart City Mission, Salvation Army, Seventh Day Adventist Church Community Services, Anglican Family Care Services, Society of St. Vincent de Paul, S.C.G. City Churches Christian Care Centre, Centacare, Launceston City Mission and Rokeby Christian Care. Mr. O'Brien for the F.M.W.U. and Ms. Fox for the A.S.W.U. indicated that they had no objection to having the exemption question dealt with as a preliminary matter, prior to the determination of the subject matter of their respective applications for the making of a Community Services Award. Community Services Award Before I deal with the exemption matter, I think it is appropriate that I make some observations regarding proceedings which must necessarily follow my decision on the threshold matter dealing with exemption for A.C.C.A. agencies. These are: -
Determination of the Exemption Matter Proceedings in this matter entailed nine days, including hearings and inspections, over 850 pages of transcript and numerous exhibits. Accordingly a great deal of material was put before me and I was able to form a complete view of the respective positions of the parties. The submissions from both sides were extensive, and I congratulate the parties for the manner in which they went about their tasks. I also appreciated the co-operation of all involved in the various inspections conducted. A.C.C.A. - Grounds for Exemption Mr. Fitzgerald advanced several major reasons why A.C.C.A. agencies should not be included as respondents to the proposed Community Services Award. They can be best summarised as follows -
Decision A great deal of emphasis was placed by Mr. Fitzgerald on the likely resultant financial implications of A.C.C.A. if an award was to come into operation and which would be binding in its totality on those agencies. In essence, it was submitted that Government funding was limited and there would be no guarantee of funding increases to offset the additional operating costs which would be incurred as a consequence of the introduction of an award. Exhibit F4 was presented by Mr. Fitzgerald to highlight the reality of financial risk. A paragraph in the exhibit, the 1982-83 Centacare Annual Report, was highlighted for my attention. In this particular paragraph the financial concerns of Centacare are expressed as follows: -
Whilst Father Kilby, in his evidence that followed, indicated that the particular situation referred to in the Annual Report had been overcome to a certain extent with a State Government Grant, he did say that the particular problem indicated above "was always a continuing problem". In fact, in Father Kilby's Director's Report, a segment in Centacare's 1984 Annual Report published in February this year, he expressed the great concern of the Association to the proposed industrial award. The Report, presented as Exhibit F5, stated in part: -
The evidence of Father Kilby ably demonstrates that the whole question of funding is a complex one. Federal Government funding is applied to specific programmes whilst the funds from the State Government may be utilised according to chosen priorities. Exhibit F7 shows that for the year ended 30 June, 1984, Centacare finished $7,500 in deficit. This takes on even greater significance when account is taken of overdraft arrangements which are in the order of $90,000. The precariousness of the situation is amply illustrated by Father Kilby's evidence when he said about the deficit: -
Mr O'Brien, in exacting cross-examination of Father Kilby on the apparent increase in the level of Government funding over the last three years or so, was not able to undermine his evidence in any way. So whilst there has been an increase in the levels of State and Federal funding, the overall scenario as presented by Father Kilby remains unchanged. One of the main thrusts of Mr. O'Brien's cross-examination on Government funding was to endeavour to ascertain what proportion of the increases in Centacare's wages bill had been Government funded. In answer, Father Kilby indicated that in budget preparations funds are requested to provide for additional workers. Depending on the success or otherwise of those submissions, extra staff may be employed. However, past increases have been in the vicinity of five to seven per cent and this does not allow the employment of an extra full-time person. A decision is then made as to how many hours per week an extra person can in fact be employed. As well as deciding which, if any, staffing needs are to be met, wage increases have also to be allowed for. Whilst wage increases are allocated at different times by the Agencies, in the Centacare example, only one pay increase is made and that is in January of each year. The impression I gained is very much in line with the affirmative response to Mr. O'Brien's question -
In that regard, and depending on the overall resources available, a decision is made, in Centacare's case by Father Kilby in association with the Bishop and his own board of management made up of employees, in choosing appropriate priorities. In the proceedings before me it was consistently stated by witnesses called by A.C.C.A. that the financial implications of an award, particularly payment of overtime and penalty rates, would have the potential effect of reducing current services provided. For example, Mr. Mills, President of the Hobart Regional Council, St. Vincent de Paul, stated that the introduction of award coverage would most likely see a curtailment in the 24 hour-a-day operation at Bethlehem House. Mr. Mills indicated that in 1984 Bethlehem House finished $16,000 in deficit. A breakdown was given which indicated that the most recent twelve month running costs for Bethlehem House amounted to $190,000 of which wages made up $98,000. To finance this particular deficit, the Society conducted a special raffle which raised $6,000. Another $4,000 was raised from further donations and the balance came from Society general funds. Mr. Mills, when queried whether the shortfall could have been funded from additional Government funds, indicated a firm "no". He added: -
I do not propose to further canvass the vast amount of material placed before me by all of the parties on the question of funding, suffice to say that I place particular weight on the evidence of Mr. Batchelor and Father Kilby, people who have had many years of experience in seeking and obtaining funds for their respective organisations, i.e. Hobart City Mission and Centacare respectively. I am not prepared to put to the test the view that, ultimately, any additional shortfall in funding that may be occasioned as a consequence of strict award-regulation will be funded from other sources including Government. Quite apart from funding, a further and very compelling reason against the necessity of award-regulation is that no evidence of any kind was produced which suggested that employees of A.C.C.A. have been disadvantaged. The theory of exploitation was certainly raised, but was unable to be demonstrated in any way at all. Quite to the contrary, when the question of staff turnover was raised with Father Kilby, with the apparent aim of demonstrating that burn out, stress, wages and conditions dissatisfaction were the reasons for the departure of certain employees from Centacare, such a theory was shown to be misconceived. The real reasons for departure were anything but dissatisfaction of any kind. One typical case outlined by Father Kilby was Mrs. H, who left to have a second child, however, whereas she was previously employed part-time, she is now still continuing as a volunteer. Another case was Mrs. T, who "had been with the Agency since 1976 but as a secretarial person and then came into that role as a Programme Co-Ordinator". (See Transcript p. 257). Specific reasons were also given for examples of employees who had moved for one reason or another. On the evidence presented, I am totally satisfied that there is a harmonious and feeling relationship between employees and their respective employers in the agencies I was able to inspect. Mr. O'Brien placed a great deal of emphasis on the fact that there appeared to be very little understanding by A.C.C.A. of the significance of the terms of the proposed award or, for that matter, the likely overall impact on costs. Extensive evidence was presented on the financial affairs of A.C.C.A. agencies. Meeting existing needs has seen many of the agencies "in the red". There is little doubt in my mind that strict observance of award provisions would exacerbate an already delicate position and I accept the submission in that regard made for A.C.C.A. by Mr. Fitzgerald of the Tasmanian Chamber of Industries. Mr. O'Brien also recognised the implications of an award in that it would change current arrangements where penalties are not being paid. He submitted: -
The context of Mr. O'Brien's submissions at that stage of the proceedings was that the terms of an award was not the issue, but award coverage per se was. In my view such a submission misses the whole basis of the argument for exemption, as put on behalf of A.C.C.A.. Throughout the proceedings it was made patently clear the A.C.C.A. was not opposed to the concept of award coverage. The over-riding concern was that wages costs would increase as a consequence of the rigid enforcement of an award, and that this would have a detrimental effect on services currently being provided. In my view a very real and genuine concern was expressed that services would have to be curtailed. This contention was supported by the evidence which illustrated the stretched resources of the agencies. Clearly the consequence of award coverage if it was to have the stated effect would not be in the public interest. Mr. O'Brien and Ms. Fox submitted, with much conviction, that existing services could be maintained. They submitted that just as employees are partially volunteering their time now, (apart from those who are solely volunteers) they could still continue to do so in the future. It was stated that employees are at present donating part of their time unpaid. Mr. O'Brien posed the following question to Father Kilby: -
I find that I do not agree with the proposition advanced by Mr. O'Brien and Ms. Fox. What was suggested by the unions on several occasions was that if it was found that the current, say full-time weekly rate of pay was ultimately going to be less than the full-time weekly rate prescribed by a new award, then the award-regulated hours to be worked each week should be determined by calculating the number of hours that need to be worked at the increased hourly rate to maintain the present levels of remuneration. Employees would then work at the hourly rate of pay for that number of hours. Once the current level of remuneration was earned at the new hourly rate, it was suggested by the unions that employees could then volunteer extra time if they so chose. As I have indicated, I reject that proposition. At the moment employees in the agencies who would be subject to the proposed Community Services Award are remunerated by reference to wage rates contained in various awards, which are not binding on the agencies. These awards are used as guides only, however the end result is weekly rate of pay for a set number of hours. Taking full-time employees as an example, in the present circumstances once a weekly rate of pay has been fixed, then that is the contract of employment. On the other hand the unions appear to be suggesting that inherent in the current rates is a notion that employees could work less than full-time hours i.e. work a limited number of hours at the appropriate award rate, after which they could volunteer their time. In my view the agencies should be permitted to staff their organisations according to their needs which they can meet from scarce resources. In that regard staffing should be on the basis of specifically designated hours as they presently are. To say that award-regulated hours should be reduced (by making full-time employees, by implication, part-timers) to equate to hourly rates which may be prescribed in a new award and that any shortfall which may arise in hours worked should be made up on a purely voluntary basis, would make forward planning by the agencies even more precarious and unnecessarily complicated. I also do not support the proposition that employees could donate back wages which may be over and above the earnings they currently receive. In my view, that is a proposition which sounds fine in theory, but would have many practical difficulties. I am of the opinion that as far as voluntary arrangements are concerned the existing status quo should be maintained, i.e. employees should continue to be remunerated according to rates determined, having regard to award being used as guides only. As was clearly illustrated on inspections, there was very strong support for these existing arrangements to continue. As far as conditions of employment are concerned, being award-free has caused no difficulties of any discernable kind. During the inspections, many examples were given where employees in fact received treatment in excess of what standard award provisions currently cater for. A particular example of such practice was in relation to sick leave. The lasting impression I formed, both from the evidence and inspections was the same as the response given by Father Kilby to Mr. O'Brien's question which was as follows: -
Mr. O'Brien pressed the point whether the specific question regarding overtime was posed. Father Kilby responded: -
For agencies other than Centacare, the evidence given by Father Kilby was substantially confirmed. In reaching my decision that the Association of Christian Care Agencies should be exempted from the proposed award, I was also cognizant of the extensive evidence presented on the question of choice. I accept the contention of A.C.C.A. that a clear choice is currently available to the community between secular and christian agencies, and which is only really made possible by the very existence of A.C.C.A. and the way it is structured. Firstly, I accept that the philosophy of A.C.C.A. is as was submitted in the proceedings before me. Father Kilby said -
and later,
When reflecting deeply on the submissions made on this particular question of philosophy, I came to the irrevocable conclusion that many employees see their employment in the Christian Care Agencies as their own personal contribution to their fellow man, and have a committed involvement in their personal religious beliefs. In my view, the comments made by Mr. C, a Supervisor at Bethlehem house, ably illustrates the point I am making and which I believe capably reflects much of the attitude of the majority of employees working in the agencies I was able to visit on inspections. The following exchanges between Mr. Fitzgerald and Mr. C. took place: -
I accept that the extent of this particular philosophy appears to be far-reaching with the agencies subject to this application for exemption. This specific issue was raised with Father Kilby who left no doubt in my mind as to the acceptance and commitment by employees to the philosophy as expressed. Father Kilby said -
On the material presented to me, I am of the opinion that, in terms of remuneration, that philosophy is accepted by the vast majority of employees. Mr. Fitzgerald asked Father Kilby:-
Father Kilby replied:-
Again, I must emphasise in this decision that the majority of employees I had the opportunity of listening to whilst on inspections were satisfied with the remuneration they were receiving as well as their conditions of employment. There were certainly no examples presented during the proceedings which could in any shape or form suggest that employees were exploited or taken advantage of by the agencies and the philosophy of volunteerism. I do not see, therefore, why I should intervene to alter what I am satisfied are generally acceptable arrangements between employer and employee, especially after having regard to the particular circumstances which have been put before me as representing the overall philosophy of Christian Care Agencies. Having dealt with that particular aspect, I now return to the question of choice to which I referred to earlier. In my opinion, the evidence of Mrs. J, a witness called by Ms. Fox, encapsulated the view I formed that those in need of the services provided by A.C.C.A. and other agencies have a clear choice. I can readily accept that in some circumstances those using a particular service will wish to seek help from one type of agency as opposed to another. This was particularly recognised by Mrs. J when she acknowledged that "there seems to be a considerable difference in the nature of the way they (Christian Care Agencies) run." (Transcript p. 522) Marriage counselling is an example of an area where choice is provided. Two organisations were established in the early 1960's, the Tasmanian Marriage Guidance Council and Centacare (or as it was then, the "Catholic Family Welfare Bureau"). According to Father Kilby, this was done "to provide an option for the people in the community for a choice in matters relating to marriage and family counselling." With regard to other types of services, shelters and facilities, I am satisfied that whilst there is good co-operation between secular and Christian agencies, the immediate goals and objectives are not necessarily the same in all cases. The conclusion I reach is that if there is any likelihood that by altering the award-free status of A.C.C.A., the very fabric or framework of the agencies will ultimately change, then I should refrain from altering that status. In addition to what I have stated thus far on the question of exemption, I would also like to refer to the October, 1977 decision of Mr. O. H. Pamplin, who in the capacity of Deputy Chairman, Child Care Industrial Board, decided against award coverage for Superintendents, Matrons, Home or House Mothers in Part III of the Child Care Industrial Award. The decision, which was submitted as Exhibit F19, ably canvasses several concepts which I also subscribe to. Mr. Pamplin made the following comments:-
As a general rule, I am also against award-free areas in any enterprise. However it must be recognised that particular circumstances can dictate, as in the matter before me, that a different course may justifiably be a preferred alternative. In his decision Mr. Pamplin preferred to allow the continuation of the negotiation by employees of their wages and conditions of employment with their particular employers, rather than order award-regulation. I also subscribe to the view that one of the important tests in an exercise of this nature, is to take into account the views of the people in the various agencies. In this case, I take notice of the common empathy that exists between the workers and those charged with the responsibility of administering the work they perform and, importantly, the direction that that work should take. Conclusion I have endeavoured to canvass the main aspects of this matter which I consider particularly important in reaching my decision that the Association of Christian Care Agencies should be permitted to continue to have award-free operation in those areas sought to be covered by the proposed "Community Services Award", if that award should be made in the future. I summarise my reasons for decision as follows:-
For the above reasons I am of the opinion that it would not be in the public interest to determine that the existing arrangements in the Christian Care Agencies, as represented by A.C.C.A., should be altered by including them as respondents to a Community Services Award (if in fact an award is indeed made). One final point I wish to comment on is the question of "sufficient interest". Mr. Fitzgerald submitted that the applicant unions did not have "sufficient interest" or even a potential interest in the area of Christian Care Agencies and therefore that an award should not be made which would cover A.C.C.A. agencies. This particular ground for exemption was predicated on Section 21(2)(c)(iii) of the Industrial Relations Act 1984, which allows the Commission discretion to dismiss a matter or a part of a matter, or refrain from further hearing, or determining the matter or part if the Commission is satisfied -
There was a great deal of debate on this ground for exemption. Accordingly, I have decided, in rejecting Mr Fitzgerald's argument, to make the following observations:-
The rejection of this particular ground does not, of course, interfere with the reasons for my decision to grant exemption for A.C.C.A. agencies from further Community Services Award proceedings, on the basis of public interest arguments advanced and established.
R. K. Gozzi |