T3059 and T2550 - 2 August
TASMANIAN INDUSTRIAL COMMISSION
Industrial Relations Act 1984
The Federated Miscellaneous Workers Union of Australia
Federated Clerks Union of Australia
Structural Efficiency Principle
REASONS FOR INTERIM DECISION
In this matter the Federated Miscellaneous Workers Union of Australia, Tasmanian Branch (FMWU) sought the variation of the Laundrymens Award to give effect to the second instalment structural efficiency adjustment.
Mr O'Brien appearing for the FMWU indicated that the application was predicated on an agreement with the Tasmanian Confederation of Industries (TCI) dealing with a number of amendments to existing award provisions but not including the classification structure. Mr O'Brien submitted that the areas of agreement may be considered by the Commission to be sufficient to vary the award on an interim basis leaving the classification structure for further negotiation between the parties. The outcome of those negotiations to be the subject of report back to the Commission within a reasonable period of time.
Mr Targett appearing for the TCI supported the submissions of Mr O'Brien and he explained the proposed amendments which were set out in Exhibit TCI.1 in the following terms.
3. PARTIES AND PERSONS BOUND
5. ANNUAL LEAVE
Subject to agreement being reached between the employer and employee/s concerned leave can be taken in multiple periods subject to at least one period being of 14 days duration i.e. 10 working days. (See Fibre Glass and Plastics Award).
Payment for work performed on a holiday may be made by taking time off in lieu at the penalty equivalent, subject to agreement being reached between the employer and employee/s concerned. (See Cleaning and Property Services Award)
9. SICK LEAVE
10. SATURDAY, SUNDAY AND HOLIDAY WORK
Subject to agreement being reached between the employer and employee/s concerned payment for work on these days may be made as time off in lieu at the penalty equivalent.
To be amended from "40" to "38".
11. TERMINATION OF EMPLOYMENT
To be re-titled "Contract of Employment.
12. ENTERPRISE FLEXIBILITY
Introduce new standard provision.
The Union have submitted a basic sketch outline for a 7 level classification structure. Employers propose less levels and are currently completing a skills survey to develop an alternative structure. This matter is subject to further discussion.
14. WAGE INCREASES
Classifications to receive the second SEP in line with increases applying to the same classifications at 23 November 1989."
Before dealing with the contents of Exhibit TCI.1 two further issues came to the fore in this matter. The first related to the position of the Transport Workers Union of Australia, Tasmanian Branch (TWU). Mr Hansch appearing for the TWU requested an adjournment of the hearing because up until the time of the proceedings he had not seen Exhibit TCI.1 and had not been involved in any prior discussions on the contents of that document. He did acknowledge however that some discussions were held between the Secretary of the TWU and Mr O'Brien. Mr Hansch said:
Mr Hansch submitted in support of the adjournment that the TWU had some difficulties with those aspects of Exhibit TCI.1 which related to the taking of time off in lieu (TOIL) by employees subject to agreement between the employers and employees. Specifically he referred to the TOIL proposals contained in the following clauses of Exhibit TCI.1:
At that point in the proceedings Mr Hansch submitted that TOIL would take away the right of employees to be paid when working on days on which a penalty would otherwise accrue. This was rejected by Mr Targett. He said that TOIL would enable employees to utilise the reward for their work in a different manner, provided that the employer and employee agreed. Mr O'Brien supported the comments made by Mr Targett. Mr O'Brien also said that TOIL was raised in other matters before the Commission and that if the TWU has a policy position on that issue then an adjournment was not going to alter the situation. In the circumstances Mr O'Brien requested that the Commission determine the issue without further delay.
With regard to item 9 - Sick Leave of Exhibit TCI.1 Mr Hansch said he had a question mark against that provision because the change would require employees on single day absences from work to provide the employer with a statutory declaration or medical certificate to verify the authenticity of the absence. On that point I was informed by Mr O'Brien that a similar variation was made in the Cleaning and Property Services Award and that it was the view of the FMWU that this kind of provision was not unusual. I support the negotiated position of the TCI and FMWU on that issue. Clearly those organisations have agreed that single day absences should be the subject of more precise scrutiny with the onus on employees to provide the necessary documentation. In my view this type of arrangement is consistent with the Structural Efficiency Principle (SEP) and does not offend the public interest.
The second principle issue related to the position of the Federated Clerks Union of Australia, Tasmanian Branch (FCU) represented by Mr Fry. I was informed by Mr Fry that the FCU wanted the existing clerical structure in the award deleted with the employees subject to that structure being classified in the Clerical and Administrative Employees Private Sector Award. Mr Fry said:
The Commission informed Mr Fry that the FCU application T.2550 of 1990 was not before the Commission at this time. The circumstances were that in TP.31 of 1990 dated 11 April 1990 the Commission requested the FCU to access the Commission when it was ready to proceed in respect of pursuing its arrangements in the Laundrymens Award following the outcome of the trialing of a new clerks structure determined by the Victorian Commission.
Since TP.31 of 1990 the FCU have not sought to progress matter T.2550 of 1990 and therefore the Commission pointed out that there may be a difficulty in progressing any SEP adjustments in the award because of the Commission's previously stated view that any award should be processed in its entirety.
In all of the circumstances and having regard to the TWU request for an adjournment and because the FCU application T.2550 of 1990 was not before the Commission the proceedings were adjourned to 21 June 1991. Subsequently on resumption of hearing FCU application T.2550 of 1990 was joined with the FMWU application T.3059 of 1991 for hearing purposes.
Mr Hansch then continued with his submissions in respect of TOIL. He said:
The thrust of the submissions made by Mr Hansch were that the Commission should not include provisions in awards which allow employers and employees to enter into agreements or arrangements which would have the effect of facilitating the variation of the taking of entitlements, including penalty payments, in a derivative manner from what is prescribed in the "originating" clause in an award. I have used the term "originating" to indicate the primary clause in the award which sets out the entitlement before any variation to the method of taking that entitlement is subsequently provided for in the various award sub clauses. Mr Hansch submitted in essence that a negotiated variation from the "originating" award entitlement by employers and employees amounted to a delegation of the powers of the Commission to "other" parties. He said that once an award had been made, other clauses in the award which permit the entering into an agreement between employers and employees constitutes a delegation of the Commission's powers and that this course was not open to the Commission having regard to the Industrial Relations Act, 1984(the Act) Mr Hansch stated:
As a consequence it was the contention of the TWU that the Commission should not endorse those parts of Exhibit TCI.1 which contemplate employers and employees entering into arrangements which differ from the basic award prescription contained in the "originating" clauses of the award.
A further aspect raised by Mr Hansch concerned whether or not employees were in a position, when asked by the employer, to genuinely agree to the taking of an entitlement in a different form to what was prescribed in the "originating" clauses. It was submitted by Mr Hansch that employees could be coerced into making agreements because of the fear of repercussions from the employer. Mr Hansch said an example may be excluding an employee from available overtime and allocating it to another employee who was more "co-operative". In the case of new employees Mr Hansch contended that the employer could seek to secure a signed document from those employees at the time of hiring which could prescribe broken leave, TOIL of overtime for Saturday and Sunday work and the like. It was said by Mr Hansch that prospective employees may not agree with those conditions of employment but because of the pressure to secure the job he or she may consent making the agreement by the employee anything but genuine. Mr Hansch said:
In addition to the foregoing Mr Hansch also expressed opposition to the inclusion of an Enterprise Flexibility provision in the award. In respect of that particular issue and the inclusion in the award of provisions enabling employers and employees to reach agreement as the method of taking of certain entitlements, Mr Hansch indicated that he had received some decisions from other tribunals. He said:
Mr Hansch informed the Commission that to further develop his arguments he would be assisted by a further 14 day adjournment of this matter. When pressed by the Commission on the need for further time Mr Hansch said that it would be to place further arguments before the Commission on its "power to delegate" (transcript p29).
Mr O'Brien opposed the adjournment. He said that Mr Hansch was suggesting that those subject to the award cannot do anything other than obey a single direct provision in an award. Mr O'Brien submitted that for many years there have been options in the award based on the agreement of employers and employees. He drew the attention of the Commission to Section 55(4) of the Act which permitted the making of agreements as required by an award. With regard to the Enterprise Flexibility proposal in Exhibit TCI.1 Mr O'Brien indicated in essence that this clause would reflect what was endorsed in other matters by the Commission as variously constituted. The clauses provides for the Agreement to be approved by the Commission pursuant to Section 55(3) of the Act where the parties are seeking something other than what is contemplated in the award.
Mr O'Brien also indicated that in respect of TOIL the TWU was involved in the Public Sector matters in T.2399 of 1990 where Exhibit W2 provided for less favourable arrangements than those contemplated here. He said the TWU had supported Exhibit W2.
Mr O'Brien requested the Commission to make a statement to the effect that TOIL provisions in an award do not contemplate futuristic Agreements being entered into between employers and employees. In other words each incident where TOIL may be an option should be regarded separately and distinctly and that a new agreement would have to be made on every occasion. This was proposed by Mr O'Brien because he said that he understood the concerns of Mr Hansch going to the question of the genuine agreement of employees when asked by employers to depart from the "originating" provisions in an award. I lend my weight to the comments of Mr O'Brien and wish to make it abundantly clear that each incident must stand alone and should be the subject of separate agreements between individual employees and their employer.
Specifically in respect of the request by Mr Hansch that he be given more time to examine material in support of the TWU position concerning the delegation of the powers of the Commission, Mr O'Brien said that this matter was adjourned previously at the request of Mr Hansch so that he could consider his position and come back and put argument to the Commission. Having regard to the submissions of Mr O'Brien supported by Mr Targett I declined the request for an adjournment.
Mr Targett also said that the TCI rejected "out of hand" (transcript p37) the matters raised by Mr Hansch going to delegation of the Commission's power. He said that the TCI did not believe that the introduction of "facilitative" provisions into the award amounted to a delegation as submitted by the TWU. Mr Targett also brought to the attention of the Commission that Mr Hansch had been party to proceedings in structural efficiency matters in the Retail Trades Award1 where similar "facilitative provisions were included in that award". The TWU represented by Mr Hansch agreed to the inclusion of those provisions in that award.
With regard to the genuine agreement of employees, Mr Targett said that whilst he accepted the right of the TWU to have an in principle position he urged the Commission to reject the submissions of Mr Hansch. Mr Targett said:
I concur with that proposition. I recognise however that it does not go to the heart of the genuine agreement concerns raised by Mr Hansch. Mr Targett quite correctly stated that Mr Hansch was not able to provide specific examples where an employer mis-applied the provisions in items 5, 6, 8 and 10 of Exhibit TCI.1. I am reluctant to assume that if there is a problem that it is an extensive one, although I accept what Mr Hansch has said that some TWU members had raised these type of concerns with him. Broken leave and TOIL provisions are not new and I would have anticipated Commission involvement in at least Section 29 proceedings leading subsequently to applications for award variations if there was abuse of the provisions on those particular subject matters already contained in awards of this Commission. Be that as it may the only real safeguard for the TWU would be for the Commission not to include in the award any of the "facilitative" provisions in Exhibit TCI.I.
Summary and Decision
Mr Hansch contended that the Commission was not able to include provisions in an award which enabled employers and employees to reach agreement. He submitted that provisions of that nature constitute a delegation of the Commission's power to parties to the award and that this was not possible having regard to the Act. I reject those submissions. Mr O'Brien quite properly referred the Commission to Section 55(4) of the Act which recognises the making of agreements in respect of award matters. That Section however does not in my opinion address fully the arguments advanced by Mr Hansch. In my view the Commission has an unquestionable power to make awards with respect to any industrial matter - Section 32(1) of the Act. Industrial matter is defined in Section 3(1)(a)(v) to include a matter relating to the mode, terms or conditions of employment. Award is defined in Section 3(1) and includes a variation to an award. It follows therefore, following the filing of an application with the Commission and after the Commission has conducted a hearing into that application (Section 25(5)) the Commission may subject to Section 36 make an award. In addition and having regard to the requirements of Section 20 where the Commission is inter alia required to act according to "equity, good conscience and the merits of the case" the Commission may make such determination in relation to the application as it considers proper.
In this matter and for the reasons stated I have reached the conclusion that the award variations requested to be made by the organisations involved (FMWU, TCI and FCU) are in the public interest and in keeping with the requirements of the SEP. I cannot find that the Commission in endorsing TOIL and broken leave provisions in the award is acting contrary to the requirements of the Act. Similarly I determine that the Enterprise Flexibility provisions requested to be included in the award are acceptable and not contrary to the intent of the Act.
It is not my intention to canvass every item in Exhibit TCI.1. However with regard to the variation to the Scope clause I consider this to be appropriate and reflective of where the award has current application. With regard to this and the remaining matters in Exhibit TCI.1 I consider that sufficient has been presented to the Commission to satisfy the Structural Efficiency Principle. I am also of the opinion that the initiatives presented to the Commission reflect a genuine attempt to restructure the Award. Accordingly in endorsing the variations submitted as a draft order in Exhibit TCI.2, it will be a matter for all of the union parties to the award to arrange with the Registrar an amendment to the certificate of registration held by them. The amendment will be to delete the Laundrymens Award from the certificates of registration and include in lieu Laundry and Dry Cleaning Award.
In this matter I noted the submissions of Ms Moncrief on behalf of The Federated Engine Drivers' and Firemen's Association of Australasia, Tasmanian Branch (FEDFA) that negotiations on a classification structure are still to take place. In that regard the FEDFA has indicated that a reference point may be the Federated Engine Drivers' and Firemen's General Award and that originally the rates in the Laundrymens Award for Division C employees were derived from that particular award. Mr Targett rejected the notion of a nexus between the two awards in question. He said that the next step in this award would be to overhaul the entire award structure. To that end the Commission was concerned that classification structures were not able to be brought forward at this time. However I acknowledge that the parties are anxious to finalise classification structures and are working to that end. Following discussions on that issue between the Commission and the parties in these proceedings a further hearing has been set down for 16 August 1991.
With regard to the FCU, the variations proposed for the award as set out in Exhibit TCI.1 also have application to clerks. In the circumstances I also intend for the variation in wage rates to apply to that category of employee.
The order operative from the first full pay period to commence on or after 21 June 1991 will be issued in due course.
R K Gozzi
Dates and Place of Hearing: