DECISION

Fair Work Act 2009
s.739 - Application to deal with a dispute

Mr Bradley Trethewey
v
Essential Energy
(C2014/1693)

Dispute arising under the terms of the dispute settlement procedure in the Essential Energy Enterprise Agreement 2013; whether position was ‘changed’ or ‘unchanged’ as a result of organisational restructure.

Background

[1] This dispute is between Mr Bradley Trethewey (the applicant) and Essential Energy (the respondent). It has been referred to the Fair Work Commission under the terms of the dispute settlement procedure in the Essential Energy Enterprise Agreement 2013 (the 2013 agreement). An attempt to resolve the dispute by conciliation was unsuccessful and the Commission has been asked to arbitrate the matter, in accordance with the dispute settlement procedure. The parties have agreed that the matter should be dealt with ‘on the papers’, and have made written submissions. The applicant filed his initial submission on 8 October 2014. The respondent’s submissions were made on 21 October 2014. The applicant made submissions in reply on 28 October 2014. This decision is based on those submissions and the supporting material filed by the parties.

[2] The dispute arises as a result of an organisational restructure affecting Essential Energy’s business. The issue the Commission has to determine is whether the role of Network Mains Manager (NMM) at Essential Energy is a ‘changed’ or ‘unchanged’ position as compared to the applicant’s previous position of Principal Engineer Network Standards (PENS). The applicant asserts that the NMM position in the revised structure is not a ‘changed position’ within the meaning of the respondent’s recruitment principles. The effect of this would be that the applicant has certain incumbency rights over the NMM position, including direct appointment or merit selection with his existing employment conditions intact (i.e. under coverage of the 2013 agreement).

[3] According to the applicant, the PENS role was originally a Group Manager role. The position was offered to him as such in March 2012 on a contract of $182,000. The applicant declined the offer on the basis that he did not wish to work ‘on contract’. There were subsequent discussions about the applicant performing the role as ‘an award employee’. On 9 April 2012, after a meeting with the then Managing Director and Engineering Services Manager, the role was accepted by the applicant on the basis that it would be a Principal Engineer role under the 2011 enterprise agreement.

[4] According to the respondent, the process of determining that a new position is a changed or newly created position can be summarised as follows:

● The PD is developed by the Hiring Manager in consultation with Human Resources (HR).
● The PD is finalised by HR and a preliminary evaluation provided to the relevant Manager.
● The final PD and evaluation is approved by the Hiring Manager and Executive Management.
● HR conducts an analysis of the PD in consultation with line management to determine changed/unchanged status in comparison to any relevant substantive PDs.
● HR meets with the relevant Executive Manager to determine the final outcome.

[5] According to the respondent, the final outcome in this case was that the NMM position was determined to be changed from the applicant’s previous position (PENS).

[6] The applicant was notified on 5 December 2013 that as a result of the restructure his substantive position would cease to exist and it would be replaced by a ‘changed position’. On 19 December 2013 the applicant was officially advised that he was a ‘redeployee’. Meanwhile he had applied for the position of Network Mains Manager (NMM, the ‘changed position’). The advertisement for the NMM left open whether it would be a contract role, or one covered by the 2013 agreement. The applicant was advised that he was the successful candidate for the NMM role on 26 February 2014. He was formally offered the position on 12 March 2013 - but as a ‘contract role’ (that is, one not covered by the 2013 agreement). He declined the offer, on the grounds that he was not willing to work ‘on contract’. The applicant notes that the subsequent review of the Primary Systems Branch had the likely effect that all the direct reports (and the staff below those reports) for the NMM would be the same as for the PENS. This confirmed in his mind a view that he had already come to, that the two positions were in effect the same. The NMM role was re-advertised on 20 June 2014 as a contract position, which led the applicant to submit his grievance with the respondent.

A comparison of the two positions

[7] A starting point for comparison of the two positions is their respective position descriptions (PDs).

[8] The PD for the PENS states that the PENS is:

‘a senior engineering role [which] will provide leadership, direction and specialist technical expertise to senior management, group engineers and employees on all aspects of good corporate responsibility relating to Engineering.

The Principal Engineer Network Standards is a senior member of the Engineering Services division with full accountability for the quality delivery of functional network design and construction standards and policies.

Further to the role the Principal Engineer will ensure that all aspects of the role meet business, industry and regulatory requirements as well as maintaining corporate due diligence.

The Principal Engineer Network Standards will be accountable for and required to:

● Undertake a key strategic-based decision-making role on critical and operational issues ensuring all actions taken enhance the achievement of corporate goals and overall business success

● Undertake a lead management role within the Network Standards team to ensure the provision of high quality business services and to ensure that opportunities are recognised and provided for the ongoing professional development and skill enhancement of the Network standards team
● Research, develop and maintain design and construction drawings, policies and standards for all networks assets for both new construction and refurbishment works including Overhead distribution and sub transmission networks, Underground distribution and sub transmission networks, Fibre Optic Cable Systems, Radio Communication Structures and other systems and equipment as identified
● Develop and implement risk based earthing designs and practices
● Ensure business needs are met and management of approvals for the procurement process of major materials and equipment used on the network including specification, tender selection, quality and operation of period contracts
● Take a strategic position in assisting senior Management in researching and developing the economic and technical aspects of the asset class distribution transformers from purchase to disposal
● Research, prepare and present key reports to provide accurate and complete information, authoritative analysis and advice to present sound recommendations for action to senior management
● Develop strong communication links with the Infrastructure Operations division to ensure that standards and policies are implemented and monitored reviewing the effectiveness and practicality of these standards in the light of field experience
● Provides support skills and specialist advice during the ongoing development and review of the design and construction standards and policies
● Network actively both inside and outside the organisation to gather intelligence on developments in technology, systems, processes and management practices that will benefit Essential Energy
● Assess develop and coach the work performance of direct reports to ensure that service delivery is effective and efficient and staff remain motivated to perform to capacity and to achieve business objectives.’

[9] The PD provides that the PENS is to report to the relevant General Manager Subtransmission Engineering, demonstrate managerial leadership, work autonomously or in a team environment, coach and mentor other professionals in the technical engineering field and be respected as the principal technical expert in the engineering field. It further provides that the PENS must, inter alia, demonstrate safety, security, health and environment compliance and/or leadership behaviours through role modelling and support of fellow employees, and promote a strong commitment to a quality culture.

The applicant submits that the PD for the PENS, consistent with Essential Energy’s practice, was broadly written using all-purpose terms that encompass a large number of engineering functions and responsibilities.

[10] The PD for the Network Mains Manager position includes the following. The position reports to the Manager Primary Systems. The purpose of the Primary Systems Branch is described as being:

‘...to manage long-term stewardship of the primary network assets. This includes retention of detailed organisational knowledge relating to primary asset parameters, performance expectations, technical compliance and diagnostic analysis. The role will also support development of key primary asset related policies and standards, develop primary asset specifications and provide expert input into primary asset maintenance and renewal planning.’

[11] The purpose of the position is described thus:

‘The Network Mains Manager is accountable for the long-term stewardship of Overhead and Underground Mains Assets including full responsibility to the Engineering, Commercial, Investment and long Term Asset Management strategies for distribution and sub-transmission assets and all related primary plant.

The Network Mains Manager is the asset owner and is accountable for the management of assets with a replacement value of $11,800M.’

[12] The Key Accountabilities are described in this way.

● Accept personal responsibility to drive improvements in safety performance by emphasising the acceptance of personal and management accountability for safety and implementing targeted programs to drive improvement in safety culture and performance.
● Take ownership of and have total accountability of asset strategy for all distribution and sub transmission overhead and underground mains assets.
● Develop and implement prudent policy, standards and practices to ensure the highest standards of Asset Management for all network mains and the associated primary plant.
● Regularly review compliance with standards and codes and monitor development of new technologies for implementation where appropriate.
● Develop technical specifications for mains and associated primary plant leading procurement activities and managing period supply contracts as appropriate.
● Own, develop and lead the constant improvement in asset data relating to mains and associated primary plant through quality assurance program.
● Monitor and report on the performance of mains assets and plant implementing revised policy, practices and specifications where performance indicates improvement opportunities.
● Lead, develop and oversee work process and asset management improvements to improve the commercial and engineering outcomes for mains assets and associated primary plant.
● Provide the highest level of technical knowledge across the whole of life for all mains assets from acquisition to disposal including operation, maintenance and the life extension.

[13] The challenges of the position are described as ‘ensuring accurate data to support prudent asset management and condition monitoring to ensure the maximum asset life commensurate with an acceptable risk profile is achieved; managing asset value of $11,800M at an acceptable risk level in a capital constrained environment; and working across many divisions and branches to lead the business to ensure the highest standard of asset management is achieved.’

[14] The applicant includes with his submission a comparison of the duties listed for the NMM with his current duties. In his view that comparison indicates that they are identical.

[15] The respondent submits, by contrast, that ‘overall the new position has been assessed by the Position Description Development and Evaluation Team as having a higher level of accountability and responsibility compared to the previous position. This is reflected in the evaluation of the position and the subsequent offer made to the Applicant including the higher remuneration offered the position.’

[16] The respondent contends that ‘at this stage there are many components of the new position which have not been finalised including budget responsibilities and direct and indirect reports, given that the Operating Model has not been finalised at Level 6 and below.... Particularly for more senior roles, a position description itself only lists the key accountabilities for the position and provides generic information on requirements such as leadership and skills knowledge and experience required to fulfil the position.... The Respondent submits that the business has changed significantly over the last two years. Senior roles such as the new position are far more accountable in the business drive to ensure that electricity price increases for our customers are kept to CPI or below.... For a senior role such as the new position, many of the Key Result Areas and Priority Actions required are cascaded down from the leadership team and are updated annually and sit separately to the position description. It is inaccurate and misleading to suggest that a role is unchanged simply by doing a line by line comparison of the Position Description proposition at this level of seniority.’

[17] The respondent contends that the requirements of the new position are at a ‘more strategic level than that of the previous position’ which is reflected in the evaluation that has been conducted. It submits that ‘the new position has full responsibility for the engineering, commercial, investment and long-term asset strategies for distribution and sub-transmission assets and related primary plant. These responsibilities were previously arranged and spread across a number of roles within the Infrastructure Strategy and Engineering divisions. With the implementation of the new operating model these distribution and sub-transmission asset ownership functions are incorporated within the Network Mains Manager role. This is consistent with counterpart roles at Ausgrid and Endeavour. This alone clearly indicates that the position is a changed role.’

[18] The respondent continues ‘the new position has a higher level of strategic decision making and accountability in relation to asset strategy for all distribution and sub-transmission, overhead and underground mains assets compared to the previous position which was primarily focussed on operational issues.... The new position will own, develop and lead the constant improvement in asset data relating to mains and associated primary planning through quality assurance plan. This is a new responsibility and never considered part of the Applicant's previous position.... The new position will lead, develop and oversee work processes and asset management improvements. This is a new responsibility and never considered part of the Applicant's previous position.’

[19] It is important to note that these contentions largely reflect the position put by the respondent in a letter to the applicant on 28 August 2014.

[20] The applicant deals with these points, as made in the letter of 28 August 2014, in some considerable detail in his submission on 8 October 2014. I do not intend to summarise all the submissions he makes, but I have taken all of them into account.

[21] With regard to responsibility for asset management strategy, the applicant contends that the NMM is responsible for the following strategic aspects of asset management:

a) construction standards of the network (standards)
b) selection of equipment to be utilised on the network (tenders and asset strategy)
c) how the network will be built (design)
d) how the network will be refurbished and renewed (refurbishment)
e) how assets will be assessed for disposal or reuse (end of life).

[22] The applicant contends that ‘these responsibilities have always been those of the Principal Engineer Network Standards. The Principal Engineer role owns, manages, develops, refines and maintains the construction manuals, design manuals and refurbishment manuals for all the distribution and sub-transmission and associated primary plant for the network. Additionally the Principal Engineer role owns the responsibility for selection of equipment to be used on the network through tender processes and network strategy work. The design requirements of the network are also owned, managed, developed, refined and maintained by the Principal Engineer role. Refurbishment requirements are similarly owned, managed, developed, refined and maintained by the Principal Engineer role. Furthermore it is the Principal Engineer Network Standards prerogative to determine when new manuals are needed.’

[23] The applicant asserts that the NMM has the same responsibilities. ‘Further to Essential Energy's assertion... that there was some shared responsibility across divisions, this is not the case’. He points to a series of documents and manuals dealing with all the relevant aspects of asset management and states that these documents were approved and issued either by the PENS or his direct reports. ‘No further approvals were required and any consultation was out business courtesy. This was and still is the process until recent changes in the policy area required the Chief Engineer to sign off on some policies....’

[24] The applicant continues:

‘Considering asset and materials selection it is the sole responsibility of the Principal Engineer Network Standards to develop the specifications for items used on the network, the technical recommendations and the recommendations to award. These documents directly address the responsibilities of long-term asset stewardship, engineering, commercial fiscal prudence and investment. The Mains Manager has the same responsibilities.’

[25] The applicant also asserts that the PD for the PENS contains equivalent provisions as those in the NMM PD with regard to having ‘full responsibility for the Engineering Commercial, Investment and long-term Asset Management Strategies for distribution and sub transmission assets and related primary plant.’ In particular, he points to the responsibility of the PENS as a senior member of the Engineering Services division with full accountability for the quality delivery of functional network design and construction standards and policies. He also notes that the PENS must research, develop and maintain design and construction drawings, policies and standards for all network assets for both new construction and refurbishment works, as well as undertake a key strategic based decision-making role on critical and operational issues, and undertake a lead management role within the Network Standards team to ensure the provision of high quality business services. He concludes ‘the broad nature of the wording utilised in the Principal Engineer Network Standards Position Description has the same outcomes and responsibilities as the Mains Manager role.’

[26] In his submission the applicant presents a detailed analysis of the engineering, commercial, and investment/long-term asset management responsibilities of the PENS, utilising relevant business plans and the PDs. This analysis, he submits, indicates that the relevant duties of the PENS are the same as those of the NMM.

[27] The applicant submits that the respondent's argument that the NMM has a ‘higher level of strategic decision-making and accountability... whereas the Principal Engineer Network Standards was primarily focused on operational issues and formed part of the team to make strategic decisions’ is presented without any supporting facts. He contends that the various documents, including the relevant business plans clearly show that the PENS role is no more operationally focussed than that of the NMM.

[28] The applicant then turns to consider the argument that the NMM role ‘will own, develop and lead the constant improvement in asset data relating to mains and associated primary plant through a quality assurance plan -- this is a new responsibility.’

[29] The applicant responds:

‘... in this argument Essential Energy has unpacked one of the aspects of asset management and strategy and attempted to re-dress it as a new responsibility when in fact this function is simply part of a good asset strategy and management governance. Consequently the Principal Engineer Network Standards had this responsibility and evidence is easily available.’

[30] The applicant then gives a number of examples from various documents which, he submits, demonstrates that the PENS already performs this role. He states:

‘Prior to the Principal Engineer Network Standards role there was no quality assurance team. This team was formed to manage the quality of assets on the network and overall network asset management quality assurance.’

[31] The applicant refers to a number of specific initiatives he has taken (or has sought to take) to improve quality assurance while performing the role of PENS.

[32] The applicant then turns to consider the statement by the respondent that the NMM ‘will lead, develop and oversee work process and asset management improvements...- this is a new responsibility’ He submits that ‘the responsibility for this in both the Principal Engineer Network Standards role and the Network Mains Manager role has been demonstrated in prior sections of this response to be an existing rather than a ‘new responsibility’ as asserted by Essential Energy.

[33] The applicant includes in his submission a detailed analysis of the duties of the NMM role, based on the outcome of the consultation process undertaken for the Primary Systems branch and what the PENS role did with those duties. He concludes based on this analysis that ‘there is no duty of any significance listed for the Mains branch that is not performed by the Principal Engineer Network Standards role. With regards to tasks that are currently not performed there is either a business restriction that has stopped activity on this task or the task is another area’s activity which the Mains team supports.’

Consideration and conclusions

[34] I have given careful consideration to the submissions and associated material filed by the parties. The applicant provides a detailed and comprehensive analysis of the two positions in support of his case that the two positions perform the same role (if with a different title). The respondent has failed to challenge the accuracy of that analysis to any significant extent. I am satisfied that the applicant makes a compelling case that the Network Mains Manager role is not significantly different from that of the Principal Engineer Network Systems. Accordingly the Network Mains Manager should be considered an ‘unchanged’ position within the meaning of the Essential Energy’s Operating Model Principles.

[35] The respondent indicates in its submission that:

‘Should the Commission find that the new position is an unchanged position a determination needs to be made as to whether the Applicant should be engaged on a contract of employment (as originally advertised and offered to the employee in April 2012 in accordance with the evaluation for the position) or on the terms of the Enterprise Agreement.’

[36] The applicant submits that this issue does not fall within the dispute referred to the Commission. He goes on to say ‘the Essential Energy Operating Model Principles simply state that if a position is ‘unchanged’ then the relevant employee maintains incumbency, within their existing conditions of employment maintained.

[37] Neither party has submitted a document entitled ‘Operating Model Principles’. However during the conciliation process an Essential Energy document entitled ‘Level 6 (and below) Recruitment Principles’ was tabled. This document was current as at July 2014. It states that:

‘The following recruitment principles will be applied for filling all positions at Level 6 and below in the Operating Model and in respect of the Essential Energy Enterprise Agreement 2013:

Position Review & Evaluation

1. For the purpose of determining whether a position in the Operating Model is changed or unchanged, all employees will be reviewed against their current substantive position.
2. After an evaluation is carried out, a position may be categorised as ‘newly created’, ‘changed’ or ‘unchanged’.
3. For an unchanged position, the incumbent will continue to be employed in this position under the new Operating Model at their substantive rate of pay.’

[38] As the Network Mains Manager position has been found to be ‘unchanged’, it would be consistent with these recruitment principles for the applicant (as ‘the incumbent’) to be employed in that position on the same terms and conditions that he was employed as Principal Engineer Network Standards. I conclude that this is what should occur.

SENIOR DEPUTY PRESIDENT

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