T7061
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Industrial Relations Act 1984 Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union and Tasmanian Electro Metallurgical Company Pty Ltd
Industrial dispute - alleged non-compliance with Industrial Agreement - application dismissed- recommendation REASONS FOR DECISION This was an application for a dispute hearing made under Section 29(1) of the Industrial Relations Act 1984 (the Act) by the Automotive, Food, Metals, Engineering, Printing & Kindred Industries Union (the Union). The Union was in dispute with the Tasmanian Electro Metallurgical Company Pty Ltd of Bell Bay (TEMCO) over a provision of the TEMCO Workplace Agreement 19961 (the Agreement). TEMCO was represented by the Australian Mines and Metals Association (Incorporated) (AMMA). Both parties agreed to accept the Commission's decision on the dispute. The disputed provision of the Agreement was in Clause 14 - TEMCO Alloyshare Plan, which specified four separate incentive payment schemes: 1. Safety Component 2. Production Performance Component 3. Cost Reduction Component 4. Individual Performance Component. The parties were in disagreement as to the amount a certain employee was eligible to be paid under the specifications of the Safety Component subclause. The employee had commenced with TEMCO during the 12 months prior to the relevant annual payment for 1996 and the Union contended he should have been paid the full annual amount of the Safety Component. As a matter of policy TEMCO had made a proportional payment to the employee. The only reference to eligibility in the Safety Component subclause was the phrase, "Annual payment in December". Until the question was raised in this dispute TEMCO had paid the Safety Component on a pro-rata basis to those employees who had not been employed for the whole of the preceding year and there had been no complaint. Those who had left their employment during the 12 months prior to December were deemed by TEMCO to be ineligible for the Safety Component payment. The Union submitted that every person employed at the time of payment should be paid the full annual amount of the Safety Component because that is what the words of the subclause meant. The Union accepted that employees who had departed prior to the payment date were ineligible, but, said it would be unfair to exclude full payment to current employees who had been employed for less than 12 months. The other three components of the TEMCO Alloyshare Plan all contained provisions for a proportional payment for those employed for less than 12 months and the Union claimed this supported its argument that a proportional payment did not apply in the case of the Safety Component because of its silence as to proportional eligibility. TEMCO submitted in response that it was wrong of the Union to rely on the silence of the provision in relation to proportional payments especially in the light of the history of the Agreement where proportional payments were not discussed for the Safety Component and the general thrust of the Agreement was to reward effort and performance. Payment ought to reflect contribution TEMCO said. The interpretation sought by the Union was inconsistent with that applying to the other components. The history of the TEMCO Alloyshare Plan was outlined to the Commission and TEMCO pointed out that originally in 1992, there was only one component, the Production Performance Component. In 1994 there were two components and the proportional provisions applied to both. The Agreement introduced two more components including the Safety Component, making a total of four components. TEMCO submitted that proportional payments were the most equitable means of linking payments to performance and acceptance of the Union's claim would lead to an unfair situation. The Union relied on the actual words of the Safety Component subclause meaning that since no pro-rata provision had been included, employees with less than 12 months service were not excluded from the effect of the subclause. DECISION It is important to note that this dispute relates to an agreement registered with the Commission not to an award of the Commission: in the latter case the matter could only be resolved by an application to the President for an interpretation in accordance with Section 43 of the Act. The significance is that the Commission in this case is not bound by the precedents established for award interpretations which I consider inappropriate here. Clause 16 of the Agreement provides for disputes to be referred to the Commission for resolution. Where the wishes of the parties are not clearly specified in an agreement the Commission would be reluctant to impose its own view. In this case the wishes of the parties as to the payment of the Safety Component to employees with less than 12 months employment was definitely not made clear in the Agreement. One of the parties acknowledged the lack of clear prescription as a failure and I agree that it was, in hindsight. On this basis alone I am not prepared to uphold the Union's interpretation. I also accept TEMCO's submissions that it would be unfair to pay the full amount of the component to an employee who had not completed 12 months employment. In the absence of a clear prescription I do not accept the Union's submission that the words of the Safety Component indicate that a full payment should be made to every employee without exclusion at the time of the annual payment. The application is dismissed and I so order: I recommend, however, that the parties negotiate with a view to varying the Agreement to avoid any further disputation or confusion on the subject.
P A Imlach Appearances: Date and place of hearing: |