DECISION

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

Construction, Forestry, Mining and Energy Union
v
BlueScope Steel (AIS) Pty Ltd
(C2016/4193)

s.739 Application to deal with a dispute.

[1] This decision relates to an application by the Construction, Forestry, Mining and Energy Union (CFMEU), in relation to a decision by BlueScope Steel (AIS) Pty Ltd (BlueScope) to refuse to pay a Hot Work Allowance (clause 9.1.2) and what can be described as a Height Allowance (clause 9.3.1) to employees in accordance with the BlueScope Steel Port Kembla Steelworks Agreement 2015 1 (the Agreement).

[2] The CFMEU was represented by its Legal Officer, Mr Tom Fischer. BlueScope was represented by Mr Martin Aicken and Ms Renee Whiteside.

Agreement Provisions

[3] The relevant provisions of the Agreement 2 are:

“6. Rates of Pay

6.1 Rates of Pay
The minimum rates of pay for any classification, subject to the other provisions, are set out in:

(a) Table 1 - Restructured Ironworkers Rates of Pay:
(b) Table 2 - Graded Trades Rates of Pay;
(c) Table 3 - Apprentices:
(d) Table 4 - Unanderra Coil Processing;
(e) Table 5 - Port Kembla Road Transport Facility;
(f) Table 6 - Bulk Berth
(g) Table 7 - Welded Products
(h) Table 8 - Other Rates and Allowances

of Part B - Monetary Rates - Restructured Classifications and Part C - Appendix -
Unrestructured Classifications.

6.2 Restructured Rates of Pay - The classifications appearing in Part B - Monetary Rates - Restructured Classifications, are new classifications which have been established as a result of restructuring processes carried out in the departments and sections of Port Kembla Steelworks in which the new classifications appear. These new classifications replace and supersede previous classifications for which rates of pay are provided in Part C - Appendix – Unrestructured Classifications.

9. Disability Rates

In addition to the rates of pay prescribed for the purposes of clause 6, Rates of Pay, the following special rates will apply:

9.1 General

9.1.1 Hot Places - Electrical and mechanical tradespersons and maintenance non-trades employees working for more than one hour in the shade in places where the
temperature is raised by artificial means to between 46 degrees Celsius and 54 degrees Celsius will be paid an allowance per hour extra as set out in item 5 of Table 8 - Other Rates and Allowances, of Part B - Monetary Rates – Restructured Classifications. This is subject to the following:

(a) in places where the temperature exceeds 54 degrees Celsius employees
will be paid per hour extra as set out in Item 5;

(b) where work continues for more than two hours in a temperature exceeding
54 degrees Celsius employees will also be entitled to twenty minutes' rest
after every two hours' work without deduction of pay;

(c) the temperature will be decided by the supervisor of the work after
consultation with the employees who claim the extra rate.

9.1.2 Hot Work – Hot Work is done in places where the temperature raised by artificial means is above 49 degrees Celsius. Employees whilst so engaged on work, as
specified below, will receive an additional amount per hour is set out in Item 6 of
Table 8 - Other Rates and Allowances of Part B - Monetary Rates - Restructured
Classifications:

(a) bricklayers and labourers assisting bricklayers whilst engaged on hot
work;

(b) The following employees, other than bricklayers and labourers assisting
brick layers and crane and engine drivers, including front end and overhead
loader driver, whilst engaged on hot work will receive an additional rate:

(i) Blast Furnaces - All employees employed in connection with
furnace demolition or on relining;

(ii) Mill Furnaces - All employees employed in connection with the
demolition of furnaces;

(iii) Gas Producers - All employees employed in connection with gas
producer work;

(iv) General - Carpenters, plumbers and labourers assisting
carpenters or plumbers other than those provided for elsewhere
in this subclause.

9.3 Bricklayers and Labourers

9.3.1 Bricklayers and labourers assisting bricklayers when brick lining stacks and when engaged on the work of inside lining the outer combustion wall of blast furnace stoves will be paid an additional rate as set out in Item 16 of Table 8 Other Rates and Allowances, of Part B - Monetary Rates - Restructured Classifications:

(a) an amount per hour when working at a height above 15 metres and not
more than 30 metres:

(b) an amount per hour for each 15 metres above 30 metres.

Height is measured from the nearest horizontal plane.”

MONETARY RATES – RESTRUCUTRED CLASSIFICATIONS
Table 1 – Restructured Ironworkers Rates of Pay

Description	Rate of pay per 38-hour week effective from the first full pay period on or after 23 July 2014
	$
Refractory Services Department
Refractory Services
Refractory Installer – Level 1	815.60
Refractory Installer – Level 2	881.30
Refractory Installer – Level 3	923.90
Refractory Installer – Level 4	984.90

Table 2 – Graded Rates of Pay

Description	Rate of pay per 38- hour week effective from the first full pay period on or after 23 July 2014
	$
3. Refractory Installation Bricklayers
Refractory Installation Bricklayer – Base Level	998.40
Refractory Installation Bricklayer – Level 1	1017.00
Refractory Installation Bricklayer – Level 2	1061.20
Refractory Installation Bricklayer – Level 3	1082.90
Refractory Installation Bricklayer – Level 4	1115.60

Table 8 – Other Rates and Allowances

Special Rates to be effective from the first full pay period on or after 23 July 2014
Item No	Clause No	Brief Description	$
16	9.3.1	Brick lining stacks etc: - Per Hour At a height of 15 but not more than 30metres For each further 15 metres increase above 30 metres	0.23 0.23

Part C

Appendix – Unrestructured Classifications

Background

[4] The parties met to discuss the issue in May. The matter was listed for conciliation before the Fair Work Commission, as presently constituted, on 30 June 2016 and 18 July 2016. The matter could not be resolved by conciliation and was listed for arbitration on 12 October 2016.

[5] a) The CFMEU submitted that the Agreement does not state in any provision that any,

or all, of the allowances contained in the Agreement are “rolled” up into the weekly rate of the restructured classifications.

b) The CFMEU further submitted that the Hot Work Allowance is payable to “bricklayers” as well as “labourers assisting bricklayers” during hot work, as defined by clause 9.1.2. Further that bricklayers and labourers assisting bricklayers are entitled to be paid an allowance that I have described as a height allowance in accordance with clause 9.3.1.

c) The CFMEU argued that whilst there is a classification called “bricklayer” in Part 3 of the Agreement (see above), no such classification exists for “labourers assisting bricklayers.”

d) The CFMEU argued that this wording is not ambiguous and that the terms must be given their ordinary meaning, ie, the phrase “bricklayer and labourer assisting bricklayer” are relevant function descriptors that attract these allowances based on the skills, location and conditions of the work rather than the actual classification.

[6] a) BlueScope argued that the CFMEU’s claim is misconceived on the basis that since

1995, these allowances have been rolled up into the restructured classifications of Refractory Installer (Levels 1-4) and Refractory Installation Bricklayers (Levels 1-4).

b) BlueScope submitted that the restructured classifications deliberately do not appear

in the provisions of clause 9.1.2.

c) Further, BlueScope advised that there are no longer any employees classified as “bricklayer” or “labourers assisting bricklayers” in the Steel Mill and that the clauses in question are very clear, ie, the allowances only apply to the identified classifications.

[7] In 1995, the Industrial Relations Commission of NSW made the “BHP Steel (AIS) Pty Ltd – Port Kembla Restructured Refractory Employees Classifications Rates of Pay Award.” 3 I note that the BWIU, NSW Branch and the AWU/FIME Amalgamated Union, NSW Branch (who are the predecessors of the CFMEU and the AWU) consented to the creation of this Award. Relevantly, Hungerford J made the following comments:

“…the restructuring sets in place a more realistic structure aligned to training resources with achievable increments in skill levels, together with an individually programmed training plan and foundations for work systems that can be expanded and modified to accommodate future expectations of employees. In addition, from the Company’s point of view, the restructuring puts in place a system which introduces flexibility of work practices so as to enable the organisation to respond to the demands of customers, the introduction of new refractory technology and the changing nature of the business. It helps ensure the long-term viability of the refractory installation business by ensuring the best and most appropriate skills structures are utilised for the changing needs of the business.

It should be remarked that the proposed award will supersede the classifications and rates of pay contained in the existing Steel Works Employees (Australian Iron and Steel Pty. Ltd – Port Kembla) Award in respect of those persons covered by it, otherwise the terms and conditions of that former award will continue to apply. I note also that the “Mixed Functions” clause of that earlier award will have no application in relation to employees covered by the new award and separate allowances will be incorporated in the new wage rates.

…As to individual employees who do not wish to participate in the restructure the agreement between the parties enable them to elect not to do so in which case they will remain on their current classifications at existing rate of pay…

…New starters entering the Department will be employed on the basis of the restructured classification system…”

(my emphasis)

Rules of Interpretation

[8] A Full Bench of the Fair Work Commission has collated and identified the relevant principles in relation to the interpretation of enterprise agreements in The Australasian Meat Industry Employees Union v Golden Cockerel Pty Limited 4;

“[41] From the foregoing, the following principles may be distilled:

1. The AI Act does not apply to the construction of an enterprise agreement made under the Act.

2. In construing an enterprise agreement it is first necessary to determine whether an agreement has a plain meaning or contains an ambiguity.

3. Regard may be had to evidence of surrounding circumstances to assist in determining whether an ambiguity exists.

4. If the agreement has a plain meaning, evidence of the surrounding circumstances will not be admitted to contradict the plain language of the agreement.

5. If the language of the agreement is ambiguous or susceptible to more than one meaning then evidence of the surrounding circumstance will be admissible to aide the interpretation of the agreement.

6. Admissible evidence of the surrounding circumstances is evidence of the objective framework of fact and will include:

(a) evidence of prior negotiations to the extent that the negotiations tend to establish objective background facts known to all parties and the subject matter of the agreement;

(b) notorious facts of which knowledge is to be presumed;

(c) evidence of matters in common contemplation and constituting a common assumption.

7. The resolution of a disputed construction of an agreement will turn on the language of the Agreement understood having regard to its context and purpose.

8. Context might appear from:

(a) the text of the agreement viewed as a whole;

(b) the disputed provision’s place and arrangement in the agreement;

(c) the legislative context under which the agreement was made and in which it operates.

9. Where the common intention of the parties is sought to be identified, regard is not to be had to the subjective intentions or expectations of the parties. A common intention is identified objectively, that is by reference to that which a reasonable person would understand by the language the parties have used to express their agreement.

10. The task of interpreting an agreement does not involve rewriting the agreement to achieve what might be regarded as a fair or just outcome. The task is always one of interpreting the agreement produced by parties.”

Determination

[9] I have taken into account all of the submissions and evidence that have been submitted by the parties. I note that the AWU (who have coverage for the non-trade classifications) did not seek to intervene in the proceedings.

[10] I do not believe that any ambiguity exists in relation to the payment of the hot work allowance or the identified height allowance that is payable to “bricklayers and labourers assisting bricklayers”.

[11] I cannot accept the interpretation submitted by the CFMEU that the phrase “bricklayers and labourers assisting bricklayers” are not classifications. Relevantly, clause 9.1.2 and clause 9.1.2(b) state the following;

“9.1.2 Hot Work - …Employees whilst so engaged on work, as specified labour, will receive an additional amount per hour…

(b) “The following employees, other than bricklayers and labourers assisting bricklayers and crane and engine drivers,…, whilst engaged on hot work will receive an additional rate…”

[12] These provisions clearly identify that the allowance is paid to employees as defined by their classification when they experience the disability. The bricklayer and labourer assisting bricklayers phrase is a descriptor of the applicable classifications, not the skills being utilized by the employee. This same logic applies to clause 9.3.1.This clause identifies what additional rate will be paid to the two identified classifications of employees when brick lining stacks and when lining the outer combustion wall of blast furnace stoves.

[13] Clauses 9.1.2 and 9.3.1 of the Agreement are very specific. These provisions apply to those employees who are classified under the Unrestructured Classifications in Part C of the Agreement, ie “bricklayers” and “bricklayer’s labourers.” It is a convenient but fallacious argument for the CFMEU to suggest that a “bricklayer’s labourer” is a different role to a “labourer assisting bricklayer”. In my view, the phrase “bricklayers and labourers assisting bricklayers” utilises more appropriate grammar then if the phrase were to read “bricklayers and bricklayers labourers.” These words provide a more concise description of the role.

[14] If I were to accept the CFMEU’s argument that there is some ambiguity in relation to this issue, then the decision of Hungerford J in making the BHP Refractory Employees Award makes the position of the parties in 1995 very clear. Put simply, a new classification structure was negotiated between the parties which “rolled up” the relevant disability allowances and created a new multi-skilled classification. However, as a transitional arrangement, employees who did not want to work in this new multi-skilled regime, could remain on their existing classification and claim the disability allowances when they encountered the relevant disability. Therefore, to protect the existing employees who did not want to transfer to the new structure, the old classifications and allowances had to be maintained.

[15] If I were to accede to the CFMEU’s argument, then those employees who are employed as Refractory Installation Bricklayers or Refractory Installers would be getting paid these allowances twice, therefore, double dipping. Such a scenario cannot be condoned.

[16] Applying the Golden Cockerel principles, I find that the allowances identified in Clauses 9.1.2 and 9.3.1 of the Agreement apply to the classifications contained in Part C of the Agreement, ie, “bricklayers” and “bricklayer’s labourers”. These allowances are not payable to employees who are classified as Refractory Installers or Refractory Installation Bricklayers.

[17] I would recommend to all of the parties to this Agreement that they undertake a review of the Agreement and remove any redundant provisions and/or classifications to avoid any doubt or possible confusion in the future.

[18] The application is dismissed.

COMMISSIONER

 1   BlueScope Steel Port Kembla Steel Works Agreement 2015 - [2015] FWCA 7954

 2   [2015] FWCA 7954

 3   IRC95/967 – BHP Steel (AIS) Pty Ltd – Port Kembla Restructured Refractory Employees Classifications Rates of Pay Award. Dated: 18/05/95

 4   [2014] FWCFB 7447

Printed by authority of the Commonwealth Government Printer

<Price code C, PR587026>