AG820635 PR939346
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AUSTRALIAN INDUSTRIAL RELATIONS COMMISSION
Workplace Relations Act 1996
s.170MD variation of certified agreement
The Australian Workers' Union
(AG2003/7810)
s.170MD variation of certified agreement
Construction, Forestry, Mining and Energy Union
(AG2003/4866)
s.170MD variation of certified agreement
Civil Construction Services Corporation t/as Civil Construction Corporation
(AG2003/9080)
CIVIL CONSTRUCTION CORPORATION ENTERPRISE AGREEMENT 2002 [AG820635]
(AG2001/7477)
Various employees |
Building, metal and civil construction industries |
VICE PRESIDENT ROSS |
MELBOURNE, 13 OCTOBER 2002 |
Section 170MD(6) applications regarding disputes over the application of the Civil Construction Corporation Enterprise Agreement 2002. Clause 9.5 ambiguous and uncertain - variation made.
DECISION
Background
[1] This decision deals with applications lodged by the Construction, Forestry, Mining and Energy Union (CFMEU), the Australian Workers' Union (AWU) and the Civil Construction Services Corporation trading as Civil Construction Corporation (CCC), pursuant to s.170MD(6) of the Workplace Relations Act 1996 (the WR Act). Each of the applications seek to vary clause 9.5 of the Civil Construction Corporation Enterprise Agreement 2002 (the CCC Agreement) for the purpose of removing ambiguity or uncertainty.
[2] I propose to set out some of the background to this matter before turning to consider the particular applications before me.
[3] The parties to the CCC Agreement are the CFMEU, the AWU, the Association of Professional Engineers, Scientists and Managers Australia (APESMA), the Community and Public Sector Union (CPSU), and CCC.
[4] The CCC Agreement was negotiated by a committee which comprised of the following persons:
Kylie Jarvis - Chairperson |
Segment Manager - Project Services - Representing CCC |
Adrian Grainger |
Segment Manager - Construction - Representing CCC |
Chris Absolom |
Continuos Improvement Officer - Representing Technical Administrative and Professional Staff |
Michael Basuik |
Representing Operations Employees |
Brian Davis |
Representing Operations Employees |
Mick Lynch |
Representing Operations Employees |
Paul Clark |
Representing Operations Employees |
Robert Flanagan |
Industrial Officer - Representing AWU |
Tony Benson |
Divisional Secretary - Representing CFMEU General Division |
Daryl Pyrke |
Manager, Tasmania - Representing APESMA |
[5] The negotiating committee met on seven occasions, on the following dates:
10 January 2002 |
18 June 2002 |
6 February 2002 |
24 July 2002 |
24 April 2002 |
20 August 2002 |
9 & 10 May 2002 |
[6] The agenda for each meeting was circulated by the Corporation to the negotiating committee and following each meeting minutes were drafted by the Corporation and circulated to all employees.
[7] It is generally agreed that the CCC Agreement was negotiated in an environment of uncertainty about the future of the Corporation. Such uncertainty arose, at least in part, because of the fact that the North East and North West road maintenance contracts, to which CCC was a party, were due to be re-tendered. These maintenance contracts were a substantial part of the business of CCC. In these circumstances the employees were concerned about the security of their entitlements if CCC were sold.
[8] The minutes of the meeting of 10 January 2002 record that Mr Basuik, an employee representative, "expressed concern that if CCC were to be sold then employees should be made redundant and not `sold/transferred' with the company".1
[9] The issue of employees being made redundant if CCC sold was further raised at the negotiating committee meeting held on 6 February 2002, at which time the Corporation advised it was waiting for a response from its lawyers.
[10] It is apparent from Mr Basuik's evidence that his position in respect of this issue changed over time. He initially proposed that all employees be made redundant in the event that CCC was sold but he later modified his position and supported the proposition that employees should be given a choice of transferring to the new employer or being made redundant.2
[11] I deal with the evidence in respect of the views of Mr Basuik and other EBA Negotiating Committee members about the intent of the CCC Agreement, and in particular clause 9.5, later in this decision.
[12] At the conclusion of the negotiating committee meetings, on 20 August 2002, it was agreed the following steps would be taken to finalise the Agreement.
"(a) AWU to provide CCC with drafting and CCC will negotiate with Unions on wording.
(b) Meeting to be held with PTA staff to resolve specific PTA concerns.
(c) CCC to advise Employee Representatives and Union Representatives of outcome of Board meeting in relation to pay increase. Parties then to agree on pay issues via correspondence.
(d) Final draft of the Agreement to be distributed to the Employee Representatives, Unions, CCC Board, CCC Minister and lawyer for final review.
(e) Changes arising from review to be made.
(f) Final Agreement to be distributed to all employees and voted upon.
(g) Document of intent and items carried forward for future negotiation to be prepared and signed off."3
[13] On 26 June 2002 employees were advised that a number of site visits would be held to give them an opportunity to provide their thoughts/ideas on the Enterprise Agreement and to ask questions. These site visits were conducted by Ms Kylie Jarvis and Mr Chris Absolom and were held during the period 8 - 19 July 2002. I return to the evidence in respect of these meetings later in this decision.
[14] The finalised Agreement was circulated to employees by CCC on 1 November 2002. A ballot was held on Wednesday 20 November 2002 and the CCC Agreement was endorsed by a `valid majority'.
[15] The CCC Agreement was made under s.170LJ of the WR Act and certified by the Commission on 31 December 2002. It has a nominal period of operation from 15 August 2002 until 14 August 2005.
[16] On 21 March 2003 the State Government announced its intention to sell the CCC.
[17] Clause 9.5 of the CCC Agreement deals with the rights and obligations of the parties in the event that CCC is sold. It provides that:
"9.5 Sale of CCC
In this clause "sale event" means an event where:
(a) CCC, its business or undertaking is sold, or transferred; or
(b) the ownership of CCC is altered to the degree that control of CCC, its business or undertaking is transferred to a third party.
In a sale event an employee whose position with CCC will no longer exist may elect to:
(a) take up another position offered in CCC, on the same terms and conditions of employment, or the owner of its business or undertaking to take effect after the sale event, or
(b) to become redundant, in which case the employee is entitled to the rights and benefits under the Enterprise Agreement, as amended from time to time."
[18] Clause 23 of the CCC Agreement governs the terms and conditions pertaining to involuntary redundancies. It states:
"23. INVOLUNTARY EMPLOYMENT SEPARATION
23.1 Involuntary separation may take place where CCC has determined that the work performed by an employee, or a number of employees, is no longer required to be performed and cannot redeploy those employees in suitable and effective positions within the organisation.
23.2 The following separation payments shall be made to full-time and part-time employees, employed pursuant to Clause 8.1 hereof, in addition to payment for accrued annual leave, long service leave, and any other statutory entitlements:
23.2.1 Employees who transferred into the new Corporation who are members of the Retirement Benefits Contributory Fund and all new employees commencing on or after the date of Corporatisation but prior to the 15th August 2002 shall be paid:
* four weeks ordinary time pay at the employee's substantive classification;
* plus two weeks pay per year of service (pro rata for
* the final part year);
* from a minimum payment of 16 weeks to a maximum of 48 weeks pay; and
* superannuation fund entitlements in accordance with fund rules.
23.2.2 Employees who transferred into the new Corporation who are members of the Retirement Benefits Non-Contributory Fund shall be paid:
* twelve weeks ordinary time pay at the employee's substantive classification;
* plus three weeks pay per year of service (pro rata for the final part year);
* from a minimum payment of 16 weeks to a maximum of 72 weeks pay; and
* retirement benefit fund entitlements in accordance with fund rules.
23.2.3 New employees commencing on or after the 15th August 2002 shall be paid a redundancy payment calculated using the following table.
Period of Continuous |
Payment |
Employment |
|
Less than 1 year |
1.75 hours per week of service. |
1 year but less than 2 years |
2.4 weeks plus 1.75 hours per |
completed week after 1 year, up to a | |
maximum of 4.8 weeks. | |
2 years but less than 3 years |
4.8 weeks plus 1.6 hours per |
completed week after 2 years, up to a | |
maximum of 7 weeks. | |
3 years but less than 4 years |
7 weeks plus 0.73 hours per |
completed service after 3 years, up to | |
a maximum of 8 weeks | |
4 years or more |
8 weeks. |
In addition they will receive:
* a bonus of an additional 2 weeks for every 5 years of service with the Corporation after Clause 23.2.3 provisions of 4 years; and
* superannuation fund entitlements in accordance with fund rules.
23.2.4 For the purpose of calculating payments under subparagraphs 23.2.1, 23.2.2 and 23.2.3, such payments shall be on the basis of the employee's ordinary hours of work and at the current rate of pay.
23.3 The payments provided under subparagraphs 23.2.1 and 23.2.2 are deemed by the parties to include payment in lieu of any unworked notice provided for under subsection 170CM(1) of the Workplace Relations Act 1996 and Clause 9 of this agreement.
23.4 A transferring employee's service for the purpose of calculating payments provided under subparagraphs 23.2.1 and 23.2.2 shall include all continuous prior service as a Tasmanian State Service employee to the date of corporatisation, as well as continuous employment since that date.
23.5 Part-time employees shall have their entitlements under this clause calculated on the basis of the average number of hours worked by the employee over the last twelve months as a proportion of full-time weekly hours for the employee's classification pursuant to clause 32 and Schedule A hereof.
23.6 In addition to the separation payment, CCC shall make available to employees whose employment is terminated as a result of involuntary separation as defined in Clause 23.1, the following benefits and services, where deemed appropriate by CCC for the particular circumstances of an employee:
23.6.1 Outplacement Services and Counselling
The provision of professional assistance in identifying appropriate career directions for the employee following separation from CCC; assistance in the preparation of an employment resume and job applications; and, where appropriate, assistance in identifying and accessing appropriate work opportunities.
23.6.2 Training
Where appropriate, the identification of and assistance in meeting the costs of retraining for an employee where such retraining will significantly improve the employee's opportunities for re-employment. Such assistance will be limited to one course of training, with a maximum value of $1,500.00 and maximum length of 5 days, unless determined otherwise by CCC.
23.6.3 Financial Services
CCC shall allow sufficient paid time for employees to seek independent financial advice on their options in relation to benefits received by them on separation and in relation to their superannuation entitlements.
23.7 Services provided under Clause 23.6 shall be delivered by CCC staff, or outside consultants or organisations as agreed between the employee and the relevant manager.
23.8 CCC shall allow an employee who is the subject of an existing involuntary separation decision, paid time up to a maximum of 20 hours in order to attend job interviews during the employee's normal working hours. This paid leave may also be accessed for job search activities approved by CCC which are conducted during normal working hours.
23.9 Where an employee, who was relocated at the request of CCC, either at the commencement or during their employment with CCC, is subject to involuntary separation, CCC shall provide relocation assistance, in accordance with CCC's Relocation Assistance Procedure as amended from time to time, to any location of the employee's choice within the State of original point of hire.
23.10 Service for the purpose of calculating the years of service component under the TESA means service with any of the following employing authorities:
* Minister administering the State Service Act 2000,
* His Excellency the Governor;
* Speaker of the House of Assembly;
* President of the Legislative Council;
* Tasmanian Development Authority,
* North West Regional Water Authority;
* Southern Regional Cemetery Trust;
* Commissioner of Police;
* Civil Construction Corporation
* Printing Authority of Tasmania
* Tasmanian Public Finance Corporation
* Tasmanian Totalizator Agency Board
* A company formed under section 5 of the TT-Line Arrangements
Act 1993
(Service with the HEC and Commonwealth is not recognised as service for the years of service calculation)
23.11 A break in service of not more than 3 months (as defined in the Long Service Leave Act 1976 and the Long Service Leave (State Employees) Act 1994) is not deemed to effect this continuity. Employment with another Government authority or the Commonwealth Government greater than 3 months disrupts this continuity and does not count towards completed years of service.
21.12 A period of leave without pay in excess of 20 working days (as defined in the Long Service Leave Act 1976 and the Long Service Leave (State Employees) Act 1994) during the period of service is not to count towards net full time service for the years of service calculation.
23.13 In the case of women who, as a requirement under the existing State legislation at that time, were obliged to resign their employment with the Employing Authority because of marriage or childbirth may have this previous continuous service considered for net full time service. It is the responsibility of the employee to provide evidence of their previous service. A suggested method of proof would be taxation records.
23.14 If an employee accepts an offer of redeployment to a position of lower classification, as an alternative to involuntary employment separation, the employee's annual salary and benefits for a period of twelve months after the redeployment shall not be less than the salary and benefits received by the employee during the previous twelve months prior to redeployment. Such benefits will be increased by the value of any pay increase that is available under this Agreement during the period of income maintenance.
23.15 Where an employee accepts redeployment, as an alternative to involuntary employment separation, the employee is entitled to apply for and be granted involuntary employment separation where the request is made in writing and is submitted to the Employer within three months from the date of redeployment."
[19] Discussion between the Unions and the Corporation regarding the application of Clause 9.5 identified a disagreement about how the provision should be applied. On 28 April and 2 May 2003, the AWU and the CFMEU lodged s.99 notifications4 regarding disputes over the interpretation of clause 9.5 of the Agreement. The essence of the dispute was over whether clause 9.5 provided CCC employees with the option of either accepting employment with the purchaser of the business or choosing to be made redundant. The unions contended that such employees were entitled to the redundancy payments set out in clause 23, CCC argued that clause 23 only applied in cases of involuntary redundancy and hence had no application where an employee chose to be made redundant.. The parties agreed to resolve the matter by proceeding to consent arbitration pursuant to s 111AA of the Act and Deputy President Leary heard the matter on 11 August 2003.
[20] Earlier, on 16 June 2003, CCC corresponded with its employees in order to identify how may employees would choose to become redundant, if that option was available. Shortly thereafter the Corporation provided to each employee with the following information:
· The dollar value of their redundancy entitlement as at 30 June 2003; and
· The ETP tax free limits in dollar figures.
[21] The basis of the CCC's calculation of the redundancy figure provided to each employee was the provisions of Clause 23 of the CCC Agreement.
[22] On August 30 2003 her Honour made a Recommendation pursuant to s.111AA of the WR Act which directed the parties to confer as to the entitlements that might apply should an employee choose to be made redundant. I deal with her Honour's recommendation in detail later in this decision.
[23] Further discussions between CCC and the Unions took place, but the parties were unable to resolve the issue of what entitlements apply in the case of an employee electing to be made redundant pursuant to clause 9.5.
[24] On 24 September 2003 the AWU and the CFMEU both lodged further s.99 notifications5 alleging the "unreasonableness of the Corporation in dictating that employees need to accept employment with another employer with a two week timeframe or employees will be deemed to have taken voluntary redundancy". The two matters were listed for hearing on 26 September 2003.
[25] On Monday 29 September 2003 Deputy President Leary issued a further recommendation which, among other things, urged urgent intervention, at a very high level of Government, in an attempt to settle the dispute.
[26] The applications before me are made in circumstances whereby the Tasmanian Government has announced the sale of the CCC to Works Infrastructure Pty Ltd (Works Infrastructure), with an anticipated hand over date of 10 October 2003.
[27] Works Infrastructure has made an offer of employment to all employees covered by the CCC Agreement.6 The offer is conditional upon settlement of the sale of the CCC business to Works Infrastructure. In the letter sent to all CCC employees they were given until 30 September 2003 to accept the offer of employment.
[28] On 30 September 2003 the Government announced that while it would not delay the sale of the CCC, it had asked the purchaser to "...extend the period of time workers have to choose between a voluntary redundancy and the job offer that is in front of them"7. That period of time has been extended to 14 October 2003.
[29] Finally, it should be noted that the Government Business Enterprises (Sale) Act 2003 governs the processes that must be followed for the sale of CCC to occur. Under this law:
· the CCC Agreement continues in force under Works Infrastructure for its natural life;
· an employee's service with CCC will be recognised by Works Infrastructure upon transfer;
· the obligation to meet accrued entitlements (annual leave and long service leave) and redundancy benefits for transferring employees will be passed to Works Infrastructure;
· there is clear recognition that transferring employees are legally entitled to claim their entitlements from Works Infrastructure; and
· there are arrangements to transfer employees to the private sector long service scheme on a pro-rata basis.8
[30] Further, the Tasmanian Government has guaranteed certain entitlements of CCC employees in the event of a sale. A Government publication entitled `Protection of CCC Employee Entitlements: The Government's Commitment to CCC Employees', dated August 2003 states:
"The Government is committed to:
_ ensuring that CCC employee's accrued annual leave and long service leave entitlements are funded at the point of sale;
_ protecting these accrued entitlements, along with your potential redundancy benefit at the point of sale (if at some time in the future you should be made redundant by the new owner of CCC) by transferring these obligations to the new owner of CCC and ensuring the new owner has a legal obligation to meet these payments when they fall due; and
_ providing you with additional comfort regarding the safety of the longer-lived, high value entitlements (ie: long service leave and redundancy benefits) past the point of sale."
The Applications
[31] The CFMEU and AWU applications, which are in identical terms, seek to clarify the interpretation and application of clause 9.5 of the CCC Agreement which has been the subject of recent disputation between the two applicant unions and CCC. This clause purports to govern the rights of employees upon the sale of CCC.
[32] Specifically the unions seek to vary cause 9.5 in the following terms:
"...by deleting the following;
"(b) to become redundant, in which case the employee is entitled to the rights and benefits under the Enterprise Agreement, as amended from time to time."
and insert in lieu thereof the following;
"(b) to become redundant, in which case such an election shall be deemed to be an Involuntary redundancy for the purposes of clause 23 of this certified agreement""
[33] There is no issue between the parties as to the following matters:
· clause 9.5 is ambiguous and uncertain within the meaning of s.170MD(6) of the WR Act; and
· on its proper construction clause 9.5 provides that employees may elect to continue in employment with the new owner on the same terms and conditions of employment or choose to be made redundant.
[34] The central issue in dispute concerns the entitlements payable to an employee in the event that they elect to be made redundant pursuant to clause 9.5.
[35] The unions argue that such an employee is entitled to the redundancy payments in clause 23 of the CCC Agreement. The Corporation contends that an employee who chooses to be made redundant is only entitled to their accumulated annual and long service leave.
[36] CCC's s.170MD(6) application seeks to vary clause 9.5 by deleting the second paragraphs (a) and (b) and inserting the following:
"In a sale event CCC employees must elect either
(a) to take up employment offered by the purchaser of the business or undertaking; or
(b) become redundant, in which case the employee is entitled to the rights and benefits under the Enterprise Agreement as amended from time to time excluding those payable under cl.23"
Employees of CCC not offered employment with the purchaser will be made redundant by CCC involuntarily after the sale event and will be entitled to the rights and benefits under the Enterprise Agreement including those in cl.23."
[37] I propose to make some general observations in respect of s.170MD(6) before turning to my consideration of the evidence and the parties' submissions.
Section 170MD(6)
[38] Section 170MD(6) relevantly provides:
"The Commission may, on application by any person bound by a certified agreement, by order vary a certified agreement:
(a) for the purpose of removing the ambiguity or uncertainty"
[39] Before the Commission exercises its discretion to vary an agreement pursuant to s.170MD(6)(a) it must first identify an ambiguity or uncertainty.9 It may then exercise the discretion to remove that ambiguity or uncertainty by varying the agreement.
[40] The first part of the process - identifying an ambiguity or uncertainty - involves an objective assessment of the words used in the provision under examination.10 The words used are construed having regard to their context, including where appropriate the relevant parts of a related award. As Munro J observed in Re Linfox - CFMEU (CSR Timber) Enterprise Agreement 1997:
"The identification of whether or not a provision in an instrument can be said to contain an `ambiguity' requires a judgment to be made of whether, on its proper construction, the wording of the relevant provision is susceptible to more than one meaning. Essentially the task requires that the words used in the provision be construed in their context, including where appropriate the relevant parts of the `parent' award with which a complimentary provision is to be read."11
[41] I respectfully agree with the observation that context is important.12 Section 170MD(6)(a) is not confined to the identification of a word or words of a clause which give rise to an ambiguity or uncertainty. A combination of clauses may have that effect.13
[42] The Commission will generally err on the side of finding an ambiguity or uncertainty where there are rival contentions advanced and an arguable case is made out for more than one contention.14 It is not enough that there are rival contentions as to the proper construction of the terms of an agreement. As Williams SDP pointed out in SJ Higgins Pty Ltd and others v CFMEU, such contentions "may well be self serving".15 The Commission's task is to make an objective judgement as to whether the wording of a provision is susceptible to more than one meaning.
[43] Once an ambiguity or uncertainty has been identified it is a matter of discretion as to whether or not the agreement should be varied to remove the ambiguity or uncertainty. In exercising such a discretion the Commission is to have regard to the mutual intention of the parties at the time the agreement was made.16
[44] I now turn to the evidence in the proceedings before me.
The Evidence
[45] The following witnesses were called by the AWU/CFMEU:
· Ms Kylie Jarvis
· Mr Adrian Grainger
· Mr Chris Absolom
· Mr Michael Busuik
[46] The CCC called its Chief Executive Officer, Mr Alan Gostelow
[47] It is convenient at this point to deal with an objection taken by Mr Zeeman, counsel for CCC, to evidence proposed to be adduced by the unions which went to the parties' intentions with respect to the entitlements to be paid in the event of a voluntary redundancy.
[48] The basis upon which the objection is put is that evidence ought not to be admitted which seeks to undermine or contradict the construction placed on clause 9.5 by DP Leary in her recommendation of 30 August 2003. In this regard Mr Zeeman contended that her Honour's recommendation adopted the following construction of clause 9.5:
· Upon a sale of the Corporation's business employees are able to elect whether to continue in employment with the new employer or to become redundant.17
· In the event that an employee elects to become redundant there is no entitlement to the involuntary separation payments provided by clause 23.18
· The expression "another position offered in CCC" on the "same terms and conditions of employment" means a suitable alternative employment with the new owner / employer.19
[49] During the proceedings I rejected Mr Zeeman's objection. I did so for two reasons.
[50] First, it is premised on a misapprehension as to her Honour's recommendation. The Corporation contends that her Honour determined that in the event that an employee chose to become redundant there was no entitlement to the payments specified in clause 23. The following extracts from her Honour's recommendation are relied upon in support of this contention:
"[36] It is unclear, even applying the recognised rules of interpretation, just how clause 9.5 could be implemented. I have determined the applications before me taking into account the sworn evidence of Mr Basuik, which was unchallenged in respect to the matters relevant to the issue in dispute, and the exhibits tendered which record the issues and claims for discussion and negotiation at enterprise bargaining meetings.
[37] I am satisfied that it was agreed that employees be able to elect whether to continue in employment with the new owner/employer or to "become redundant". However if an employee elects to "become redundant" there is nothing in the EBA which provides what entitlements will be available for such election. The EBA does not provide any benefits for voluntary redundancy and there was no evidence which addressed just what entitlements the parties were considering in their negotiations. It may be that the negotiators will need to revisit their initial discussions.
[39] The difficulties in the determination of these applications should not be under-estimated, the Commission was not involved in any of the negotiations, the prime negotiator for CCC, who also kept the minutes and notes of discussions, was not called to provide any evidence and the wording of the clause guarantees confusion and disputation. Nevertheless as noted previously, I am satisfied that the intent of the negotiations was to allow the right to elect to either be declared redundant or accept on-going employment with the new owner of the CCC business. Regardless of what election is made the words in clause 9.5 fail to define entitlement in any way which can be easily applied. I have already stated that there is no explanation as to what rights and benefits accrue if redundancy is elected (or volunteered) nor is there any explanation as to what is meant by the same terms and conditions of employment when the terms and conditions of employment currently enjoyed by CCC employees cannot apply to a potential new owner."
[51] While her Honour found that here was "no entitlement to the involuntary employment separation provision found at clause 23" this finding must be seen in context. The underlined words set out in the above extract are important. No evidence was put before her Honour which addressed the entitlements the parties were considering in their negotiations. In these circumstances her Honour was unable to discern the mutual intent of the parties with respect to this issue. This is made clear in paragraph 39 and 40 of her Honour's recommendation:
"[39] The difficulties in the determination of these applications should not be under-estimated, the Commission was not involved in any of the negotiations, the prime negotiator for CCC, who also kept the minutes and notes of discussions, was not called to provide any evidence and the wording of the clause guarantees confusion and disputation. Nevertheless as noted previously, I am satisfied that the intent of the negotiations was to allow the right to elect to either be declared redundant or accept on-going employment with the new owner of the CCC business. Regardless of what election is made the words in clause 9.5 fail to define entitlement in any way which can be easily applied. I have already stated that there is no explanation as to what rights and benefits accrue if redundancy is elected (or volunteered) nor is there any explanation as to what is meant by the same terms and conditions of employment when the terms and conditions of employment currently enjoyed by CCC employees cannot apply to a potential new owner.
[40] There was no evidence as to what entitlements would accrue to an employee who sought voluntary redundancy and no evidence as to whether it was even the subject of discussion between the parties at the time. As noted the EBA makes no provision for a voluntary redundancy."
[52] That evidentiary gap is sought to be remedied in the proceedings before me.
[53] I should also note that I do not agree with the Corporation's contention that her Honour found that the expression `on the same terms and conditions of employment' means suitable alternative employment with the new owner/employer. Paragraph 38 of her Honour's recommendation is cited in support of this proposition:
"[38] The parties should consider that the part of clause 9.5 which requires that "another position offered in CCC [the new owner/employer]" be on the "same terms and conditions of employment" be applied to mean that employment may be offered in another position which is deemed to be "suitable alternative employment". Otherwise, in my view, that part of clause 9.5 can never be satisfied." (emphasis added)
[54] Contrary to the Corporation's submissions, the above statement does not amount to a finding as to the proper construction of clause 9.5. Rather, her Honour was simply identifying an issue for the consideration of the parties in their subsequent discussion.
[55] My second reason for rejecting the Corporation's evidentiary objection is that her Honour's recommendation was made in a different statutory context. I am dealing with applications made pursuant to s.170MD(6). The approach taken by the Commission to such applications has been set out earlier in this decision. The first part of the process is the identification of ambiguity or uncertainty. Once an ambiguity or uncertainty is found the Commission then has the discretion as to whether it will vary the agreement in question to remove that ambiguity or uncertainty. The mutual intention of the parties is relevant to the exercise of that discretion. Given the different statutory context I fail to see how, as a matter of law, I am constrained in some way by her Honour's recommendation.
[56] I now turn to the evidence in the proceedings before me, which can be conveniently grouped under the following headings:
· Mutual intent
· Past practice
· Explanation of the terms of the agreement provided to the CCC employees
· The Chief Executive Officer
· Management team meetings
Mutual Intent
[57] Ms Jarvis and Messrs Grainger and Basuik all gave evidence regarding what they believed to be the agreement with regard to the benefits to be paid to employees if they elected to be made redundant in the event of CCC being sold. Each of these witnesses were members of the EBA Negotiating Committee. Ms Jarvis and Mr Grainger represented CCC and Mr Basuik was an employee representative.
[58] Ms Jarvis gave evidence as to her understanding of the intent of clause 9.5 from her perspective as a CCC representative on the EBA negotiating committee:
"Mr Flanagan: What did the Corporation intend to be the redundancy payments to employees if they elected to be made redundant on the sale of it?
Ms Jarvis: The same redundancy provisions that have always applied, a minimum of 16 weeks unless you're an employee who started after the August date when there was redundancy provisions.
Mr Flanagan: So with the exception of the employees that started after 8 August, the redundancy provision would be the provisions which were contained within clause 23.3.1 and 23.2.2, is that right?
Ms Jarvis: Correct."20
[59] Ms Jarvis also confirmed that the draft clause 9.5 provided by the Corporation's legal advisors and tabled at an EBA Negotiating Committee meeting was intended to reflect the position set out in the above extract from her evidence.21
[60] Ms Jarvis could not recollect any specific discussions during the course of the EBA Committee meetings about the actual redundancy provisions which would apply in the event that an employee elected to be made redundant upon the sale of CCC. 22 The following exchange took place towards the end of Ms Jarvis' cross-examination:
"Mr Zeeman: ...During the negotiating stages that were part of the process and particularly the meetings that took place and the committee that you sat upon, was it ever raised as to the specific entitlement that would flow if an employee elected redundancy under clause 9.5?
Ms Jarvis: Not that I can recall.
Mr Zeeman: You don't recall having a conversation with anyone about that?
Ms Jarvis: In the negotiating committee?
Mr Zeeman: Yes?
Ms Jarvis: No.
Vice President Ross: Can I just ask in relation to the last point were there any discussions that you can recall during the course of the negotiating meetings about what would occur in the event that someone elected to take voluntary redundancy?
Ms Jarvis: No, I think it was just - well, from my point of view, I assumed - I can't recall any specific discussions on it...I assumed redundancy is redundancy. Not realising clause 23 was involuntary employment separation I took the term redundancy and the wording of clause 9.5 to mean redundancy...We talked about redundancy under clause 9.5...And I've interpreted a redundancy to be clause 23...So therefore I have made the assumption that the minimum of 16 weeks..."23
[61] Mr Grainger also gave evidence as to his understanding of what payments were intended to be made to employees if they elected to be made redundant on a `sale event'. He said that his understanding "...is that it was covered by the EBA, within the EBA itself."24, and he subsequently confirmed that the payments he was referring to were those set out in clause 23 of the CCC Agreement.25 Mr Grainger also said that the draft of clause 9.5 proposed by the Corporation's legal advisors was intended to reflect his understanding of how the clauses would operate (as set out above).26
[62] In relation to the extent of the EBA committee's discussion of this issue Mr Grainger said:
"...it was raised at the EBA meetings what entitlements would be - that people who had a choice, what would they be entitled to. This was discussed at the EBA meeting and then we said we would take some clarification back to a management meeting and that's what we did"27
[63] Mr Basuik sets out his understanding of the intent of clause 9.5 at paragraph 11 of his witness statement, in these terms:
"The negotiating committee met again on 9th and 10th May 2002. Again the committee discussed the issue of redundancy being paid if the Corporation was sold. Chris Absolom advised that employees in Project Services wanted a choice. Given the feedback I and other committee representatives had received, the proposition of a choice was acceptable to every one on the committee including the representatives of the Corporation.
The very clear agreement was that if the Corporation was to be sold then employees would either have a choice to stay with the new owner or to elect to become redundant and would receive the redundancy entitlements under Clause 23. The committee accepted the lawyers wording as being intended to reflect that position. The reference in the lawyers wording to "benefits under the enterprise agreement" was intended to make clear that Clause 23 specified the redundancy entitlements that would apply."28
[64] During the course of his cross examination Mr Basuik was asked whether there had been any discussions during an EBA Committee meeting about the entitlements which would flow to an employee if they elected to become redundant upon the sale of CCC.29 Mr Basuik was clear that in his view the entitlements were those under the CCC Agreement and that "as far as redundancy was concerned there was only one redundancy".30 That is that the redundancy packages applicable in respect of voluntary and involuntary redundancy were the same. But he could not recall this issue being discussed during any of the EBA Committee meetings as "it was never a real issue".31
Past Practice
[65] The past practice of the Corporation with respect to the extent of entitlements paid in the event of voluntary redundancy was also the subject of evidence in the proceedings.
[66] Ms Jarvis gave evidence regarding the assignment of a contract for road maintenance in South Australia from CCC to RPC Roads32. The events in question took place some time prior to the certification of the CCC Agreement. At the relevant time CCC employed some 10-12 employees in South Australia. When the road maintenance contract was assigned to RPC each of CCC's South Australian employees was given the option of taking up an offer of employment with RPC Roads or being made redundant. Two employees chose redundancy and they were paid a redundancy benefit based on the formula which is now reflected in clause 23 of the CCC Agreement.
[67] In his evidence Mr Basuik said that in the 20 years he has been employed by CCC and its predecessors there has been no difference between the redundancy packages provided in respect of voluntary and involuntary redundancies.33
Explanation of the Terms of the Agreement Provided to CCC Employees
[68] A mentioned earlier in this decision a series of site meetings were held between 8 and 19 July 2002. The purpose of the meetings was to provide CCC employees with an opportunity to provide their thoughts/ideas on the proposed enterprise agreement and to ask questions. The schedule of meetings34 held is set out below:
Date |
Time |
Attendee's |
Location |
Monday 8th July |
11.00am |
St Mary's Depot Staff |
St Mary's Depot or on Site |
Monday 8th July |
3.30pm |
Derby Depot Staff |
Derby Depot |
Tuesday 9th July |
7.00am |
Barry Collis & Jimmy Hammersley |
Via telephone |
Tuesday 9th July |
3.30pm |
Breadalbane Office Staff Breadalbane Maintenance Staff |
Breadalbane Conference Room |
Monday 15th July |
3.00pm |
Ulverstone Office Staff Weedspraying Staff Ulverstone Maintenance Depot Staff North West Bridge Staff Golden Valley Staff |
Ulverstone Conference Room |
Tuesday 16th July |
7.30am |
Smithton Depot Staff |
Smithton Depot |
Tuesday 16th July |
1.00pm |
Strahan Construction Workers |
On Site - Strahan |
Tuesday 16th July |
3.00pm |
Queenstown Depot Staff Fingerpost Depot Staff |
Queenstown Depot |
Wednesday 17th July |
3.00pm |
Whitestone Drive Office Staff |
Whitestone Drive Conference Room |
Thursday 18th July |
7.30am |
Road Construction Staff Bridge Construction Staff Plant Operators |
Whitestone Drive Plant Shed |
Thursday 18th July |
11.30am |
Copping Tip Staff |
Copping Tip |
Friday 19th July |
7.30am |
Tasman Bridge Staff |
Tasman Bridge Crib Room |
[69] The site meetings were conducted by Ms Jarvis, accompanied by Mr Absolom.
[70] During the course of the meeting at Whitestone Drive on Wednesday 17 July 2002 employees sought clarification regarding their entitlements in the event that CCC was sold and they elected to become redundant. Ms Jarvis' evidence was that she provided an answer in the following terms:
"The South Australia scenario was actually used...in the example such as if we were sold, if an employee didn't have a position they would be made redundant; others had a choice of transferring over or having redundancy payments of a minimum of 16 weeks."35
[71] Ms Jarvis later confirmed that the entitlement to a minimum payment of 16 weeks pay was based on clause 23 of the CCC Agreement.
[72] Later in the course of her evidence in chief, the following exchange took place between Mr Flanagan, appearing for the AWU, and Ms Jarvis:
"Mr Flanagan: So it was made clear to the employees at this meeting that you are referring to that if the agreement was approved they would have the option to make an election if the business was sold, was that communicated?
Ms Jarvis: At the Hobart meeting, yes.
Mr Flanagan: Yes, and it was communicated to them if they made that election to become redundant they would get benefits of the proposed clause 23?
Ms Jarvis: Yes."36
[73] Ms Jarvis was not cross examined in respect of this part of her evidence.37
[74] Ms Jarvis could only recall this issue - that is an employees entitlements in the event that CCC was sold and they elected to become redundant - being raised at the Whitestone Drive meeting on 17 July 2002.38
[75] Mr Absolom gave evidence that during the site meetings employees were told, in response to questions regarding the redundancy payments that would apply in the case of CCC being sold, that they would receive the benefits of clause 23 of the CCC Agreement.39
[76] Under cross examination by Mr Zeeman, Mr Absolom also gave evidence that the issue of redundancy payments in the event that CCC was sold was raised at the majority of the site visits.40 He also gave evidence that it was Ms Jarvis who made reference to the `16 week minimum' as being the applicable redundancy payments.41
[77] In his witness statement, Mr Basuik states that the issue of the redundancy payment applicable upon the sale of CC was discussed at the site meeting he attended at Breadalbane on 9 July 2002.42 He says that he discussed the issue with Mr Steve Rebell, who was "a clerk who reported to Kylie Jarvis".43
[78] During his cross examination by Mr Zeeman, Mr Basuik again stated that the issue regarding the redundancy payments applicable upon a sale of CCC were during the Breadalbane site meeting. He also gave evidence that clause 23 was specifically raised, in the following terms:
"Mr Zeeman: Right. You have indicated that it was discussed, however, with other people outside of these EBA meetings?
Mr Basuik: Yes, in meetings that - that Kylie rang, combining all the different work groups, individually, like in work groups and the office staff as well as my depot, we were involved in that, that was discussed there. That's how the short - short-term employees voiced their opinion on it, what they would get and it was because it was because it was 16 weeks it wasn't worth their while. That's why we changed it to amend those that wanted to take the job, take the job, if it was offered.
Mr Zeeman: These discussions that you had, were they making specific reference to clause 23, or was it just what you understood to be a reference to clause 23?
Mr Basuik: No, it was definitely clause 23 because the short-term employees would only get 16 weeks. It was 16 weeks for a short-term employee. It was the maximum they'd get and they said it wasn't worthwhile them putting - taking the redundancy of 16 weeks rather than a job."44
The Chief Executive Officer
[79] In his statement Mr Gostelow, the Chief Executive Officer of CCC, outlined his understanding of the effect of clause 9.5 in the following terms:
"9. At that time I understood that the effect of this clause was that in a sale of part or the whole of the business an employee whose same position with the purchasing company continued following a sale of the Corporation, had no entitlement to elect redundancy. I signed the Agreement with that understanding.
10. I also understood the clause was to deal specifically with the circumstance of an employee not being offered their same position of employment with the purchaser following a sale. I had in my mind that it may be possible to sell part of the business with Civil Construction Corporation retaining the balance, and offer an alternative position to employees who were not offered employment with the purchaser of part of the business of Civil Construction Corporation. I also had in mind that employees whose positions were lost in a sale of part of the business might be offered employment by the purchaser in other positions in their business.
11. I also believed that if the entire business was sold as a going concern and some employees were not offered the same position with the purchaser they would thereby become involuntarily redundant and entitled to the benefits of Clause 23 of the Agreement. It was my understanding in those circumstances that Clause 9.5 would give the employees an option of taking up a different position with at least the purchaser, even though an alternative position was not available to be offered by the Corporation.
12. I understood in those circumstances Clause 9.5 would give that redundant employee a further choice of accepting employment with the new owner of the business that had been sold or another with the Corporation. In both cases, in a position different to the position that person was in before the sale."45
[80] Mr Gostelow also stated that he had no direct involvement in the negotiations for the proposed enterprise agreement.46
[81] During cross-examination by Mr Flanagan, Mr Gostelow gave evidence that he did not seek advice from the management representatives on the EBA Committee regarding the meaning of clause 9.5.47
Management Team Meetings
[82] One of the issues that emerged during the proceedings was the extent to which management representatives on the EBA negotiating committee had communicated with senior Corporation management, and in particular Mr Gostelow, in respect of their understanding of clause 9.5 and the payments to be made to employees who elected to be made redundant in the event that CCC was sold.
[83] The evidence supports findings that there were regular monthly meetings of the Corporations management team.48 These meetings were usually attended by Ms Jarvis and Messrs Gostelow, Duckett, Davies and Grainger.49 Other management personnel attended from time to time as required.50 Minutes of the EBA meetings and draft agreement provisions were circulated at these meetings.51 In particular the draft of clause 9.5 that had been prepared by the Corporation's legal advisors was tabled, discussed and accepted at the management meeting in March 2002.52
[84] In her evidence Ms Jarvis states that at the March 2002 management team meeting she advised Mr Gostelow (and the others in attendance) of what clause 9.5 was intended to achieve.53 In that context Ms Jarvis made reference to the `South Australian example' by way of illustration as to how clause 9.5 would operate, but made no specific mention of the precise entitlement which would flow if an employee elected to become redundant under clause 9.5. No specific reference was made to the redundancy entitlements in clause 23 of the CCC Agreement. Nor was any mention made of the amount of redundancy pay paid to the two South Australian based CCC employees who elected to be made redundant.54
[85] During the course of his examination in chief Mr Grainger was asked whether he told the CEO that clause 9.5 meant that if there was a `sale event' and an employee elected to be made redundant that they would receive the redundancy benefits identified in clause 23. He replied in these terms:
"Probably not me, myself, but as part of the team with Kylie Jarvis who was the Chairman, all correspondence and all information that came out of here would have gone through to the CEO and that was tabled."55
[86] Mr Grainger was also asked whether this issue was discussed at any of the management team meetings, to which he said:
"Yes, it would have been brought up at the management meeting because it would have been of some expense to the Corporation and it affected my business with the construction industry because I was probably the person that was going to lose most people if they took a redundancy because it is a known fact that in the construction industry where you have got an ageing population and mine were a very old age group. So yes, it was discussed. I can't remember the exact details because it was back in March."56
[87] These aspects of Mr Grainger's evidence was the subject of extensive cross-examination.57
[88] In his closing submissions Mr Zeeman, on behalf of CCC, sought to characterise Mr Grainger's evidence on this issue as "incomplete" in that he "summarised what might have happened but had no direct recollection".58
[89] I don't agree with Mr Zeeman's characterisation of Mr Grainger's evidence. I acknowledge that Mr Grainger was unable to recall a number of details about the management meeting at which he says that clause 9.5 was discussed. He could not recall when the meeting took place, though he said it was early in the EBA discussions, around February or March 2002.59 Nor was he able to recall where the meeting took place, as he put it:
"I couldn't confirm it exactly. Generally we had early meetings in Hobart and then we moved to Launceston so no, I couldn't confirm it without going through the minutes."60
[90] Nor was Mr Grainger able to recall who was at the meeting in question61 other than Ms Jarvis62, Mr Gostelow and Mr Davies63.
[91] Given that the meetings in question took place some 18 months ago Mr Grainger's inability to recall such details is unsurprising and does not reflect adversely on his credit. In my view Mr Grainger's evidence reflected his best recollection of the events in question.
[92] What is apparent from a fair reading of the totality of Mr Grainger's evidence is that his recollection is that the intent of clause 9.5 was discussed at a management meeting. the following exchanges during the course of his cross examination support such a conclusion:
"Mr Zeeman: You gave evidence that you must have spoken to the management committee about the issue of what entitlements would flow if a person elected redundancy. Is that the correct assessment of your evidence?
Mr Grainger: Yes, that would have been correct."64
"Mr Zeeman: I put it to you that you don't recall that this particular issue was raised at a particular meeting?
Mr Grainger: I'd have to refute that. I would say it was raised because it was..."65
"Mr Zeeman: Well, what I am asking you if it is not correct I want you to enlighten me as to who spoke these words and what entitlement was precisely discussed and who said what?
Mr Grainger: We, as - in the role of the EBA committee it was - information was tabled through to the...
Mr Zeeman: No, excuse me, but I just interrupt for a second?
Mr Grainger: Yes.
Mr Zeeman: Not "if" and "perhaps". I want you to call on your recollection only?
Mr Grainger: Yes. The information was raised at the management meetings of all the - every item we discussed at the EBA and...
Mr Zeeman: Which - I am not talking about every item. I want you to talk - I am talking about clause 9.5 and essentially my question is this?
Mr Grainger: Mm.
Mr Zeeman: Do you recall during the management meeting a discussion about what entitlement would flow if someone elected to become redundant under clause 9.5 of the agreement?
Mr Grainger: Yes, I raised - I know personally I raised - I can't remember the exact words.
Mr Zeeman: So you raised the issue?
Mr Grainger: Or...Kylie might of started off. I'm sure I would have added to it."66
[93] Later in his evidence Mr Grainger confirms that "I did raise the point"67 and said that:
"I brought up that I was concerned with the redundancy pay outs that could happen and the fact that I would lose my work force if it did happen."68
[94] Mr Grainger's evidence was that he was concerned about the impact of clause 9.5 on the CCC if there was a `sale event'. In particular he was concerned about the financial impact of the payment of redundancy monies if employees chose to be made redundant and the impact of a loss of personnel. Given his concerns it is certainly understandable that Mr Grainger would recall this issue being discussed, even though he was unable to recall a number of the details of the meeting at which it was discussed.69
[95] In relation to what was said at the management meeting at which clause 9.5 was discussed, Mr Grainger's evidence broadly accords with that of Ms Jarvis. While he could not recall the specific words used70 he did recall that the quantum of an entitlement which would flow from a redundancy if an employee elected to be made redundant under clause 9.5 was not discussed.71 This issue of the quantum of an entitlement was clarified in a subsequent exchange between Messrs Zeeman and Grainger:
"Mr Zeeman: As I understand your evidence that quantum was never discussed during one of these management meetings it follows that the mechanism in how redundancy payments would be calculated upon an employee electing redundancy under clause 9.5 was also not discussed?
Mr Grainger: No, not true.
Mr Zeeman: Not true?
Mr Grainger: No. When I said quantum I am talking about dollars and cents, exact details, but the actual intention of clause 23 was well known.
Mr Zeeman: When you say well known, was it discussed at one of the management meetings?
Mr Grainger: It was raised by me that there would be a significant impact on CCC if this was invoked, if this was used, both financially and for the fact that I would lose my ageing work force.72 (emphasis added)
[96] For completeness I note that minutes of the management team meetings were taken but were not produced in the proceeding to contradict the evidence of Ms Jarvis and Mr Grainger. Further, Mr Gostelow was in attendance at the management team meetings but his evidence did not canvass what was discussed at those meetings. In particular no evidence was adduced from Mr Gostelow regarding the accounts given by Ms Jarvis and Mr Grainger of the management team meeting discussions about clause 9.5.
Findings
[97] In my view the evidence supports the following findings:
1. The mutual intent of the parties at the time the CCC Agreement was made was that if an employee elected to be made redundant under clause 9.5 then they were entitled to the redundancy payments set out in clause 23 of the CCC Agreement.
While I accept that this issue was not the subject of any detailed discussion at the EBA Negotiating Committee meetings, the evidence before me clearly establishes that both management and employee representatives on that committee were of the same mind in respect of the application of clause 23. The matter did not need to be articulated because, consistent with the Corporation's past practice, it was assumed that the employee entitlements in respect of voluntary and involuntary redundancies would be the same.
I accept Mr Gostelow had a different understanding of the effect of clause 9.5, but Mr Gostelow had no direct involvement in the negotiations for the proposed agreement. Nor is there any evidence that he communicated his subjective intention to any other person.
2. The above finding in respect of the mutual intent of the parties is supported by the following findings in respect of the extent to which the management representatives on the EBA Negotiating Committee communicated with senior management in respect of their understanding of clause 9.5 :
2.1 There were regular monthly meetings of the Corporation's management ream, which were usually attended by Ms Jarvis and Messrs Gostelow, Duckett, Davis and Grainger;
2.2 Minutes of the EBA Committee meetings and draft agreement provisions were circulated at those meetings; and
2.3 The draft of clause 9.5 that had been prepared by the Corporation's legal advisors was tabled, discussed and accepted at the management team meeting in March 2002. At that time no specific reference was made to the entitlements in clause 23, or to the quantum of the entitlement. However, the intent of clause 9.5 was discussed in terms of the South Australian example. Hence it was known that if an employee chose to be made redundant they would be paid the standard redundancy entitlements applicable in the event of an involuntary redundancy, in accordance with the Corporation's past practice.
3. The past practice of the Corporation is that there has been no difference between the redundancy packages provided in respect of voluntary and involuntary redundancies.
4. During the site meetings held between 8 and 19 July 2002, CCC employees were told, in response to questions regarding the redundancy payments that would apply in the case of CCC being sold and they elected to become redundant, that they would receive the benefits set out in clause 23 of the CCC Agreement. This information was conveyed by Ms Jarvis, a member of the CCC management team and the chair of the EBA Negotiating Committee.
Submissions and Decision
[98] The unions submit that the evidence in the proceedings establishes that the mutual intent of the parties was that if an employee chose to be made redundant pursuant to clause 9.5 then they would be entitled to the redundancy payments set out in clause 23 of the CCC Agreement. For reasons which will become apparent it is unnecessary for me to deal with the union's submissions in detail.
[99] As for the Corporation, broadly speaking there are three limbs to the argument in support of the variation of clause 9.5 for which it contends.
[100] The first point is premised on the proposition that in her decision in relation to the s.111AA matter, Deputy President Leary determined that in the event that an employee elects to become redundant there is no entitlement to the involuntary separations payments provided in clause 23. It is argued that in the proceedings before me the Commission is limited to a consideration of whether the CCC Agreement should be varied to express the conclusion stated by her Honour.
[101] I have already substantially dealt with this point in the context of my ruling in respect of Mr Zeeman's evidentiary objection. It is clear from a fair reading of the recommendation that her Honour was unable to determine the issue of employee entitlement as the evidence before her did not address that issue. But even if I am wrong about that matter I do not accept that I am bound to apply her Honour's conclusions in any event given that the matters I am dealing with arise within a different statutory context.
[102] The second point goes to the issue of mutual intent. In this regard counsel for the Corporation, Mr Zeeman, contends that there was no meeting of minds on the EBA Committee as the question of employee entitlement, in the event that voluntary redundancy was chosen, was never discussed. Mr Zeeman also relies on the evidence of Mr Gostelow as reflecting the intent of the Corporation in relation to the meaning of clause 9.5.
[103] The third limb to Mr Zeeman's argument relate to the offer of employment made by Works Infrastructure and to the associated State government guarantee of entitlements.
[104] Contrary to the Corporation's submissions I am satisfied that the mutual intent of the parties was, as contended by the AWU and CFMEU, that if an employee elected to be made redundant under clause 9.5 then they were entitled to the redundancy payments in clause 23.
[105] I am satisfied that clause 9.5 of the CCC Agreement is ambiguous and uncertain. In particular I am satisfied that there is an ambiguity and uncertainty in relation to the entitlements of employees in the event that CCC is sold and they chose to become redundant.
[106] I am persuaded that I should exercise my discretion under s.170MD(6) and remove the ambiguity and uncertainty by varying clause 9.5 in the manner proposed by the AWU and CFMEU applications.
[107] In my view such an outcome reflects the mutual intention of the parties at the time the agreement was made. It is also consistent with the information given by Corporation representatives to CCC employees about how clause 9.5 would operate in practice.
[108] I have considered the contrary arguments advanced on behalf of the Corporation. I acknowledge that the offer made to all employees by Works Infrastructure would constitute acceptable alternative employment in the context of the relevant test case standard. While that is relevant to the exercise of my discretion, it is not determinative. It has to be weighed against the mutual intent of the parties and the information provided to the CCC employees.
[109] In this context it must be born in mind that my task under s.170MD(6) is not to rewrite an agreement so that it contains something that was not inherent in it when it was made. As stated in the objects of the WR Act:
"3. Principal object of this Act
The principal object of this Act is to provide a framework for cooperative workplace relations which promotes the economic prosperity and welfare of the people of Australia by:
...
(b) ensuring that the primary responsibility for determining matters affecting the relationship between employers and employees rests with the employer and employees at the workplace or enterprise level"
[110] As a matter of general industrial principle there is considerable force in the argument advanced by the Corporation. If an employee is offered acceptable alternative employment they are not entitled to paid redundancy pay. However, I am not dealing with this matter in the abstract. I am dealing with it in the context of s.170MD(6) and in my view I am obliged to give considerable weight to the mutual intention of the parties at the time the agreement was made.
[111] Further, in view of the advice given to CCC employees by a representative of the Corporation's management team, and the chair of the EBA Negotiating Committee (Ms Jarvis), considerations of fairness also favour varying the agreement in the manner proposed by the unions.
[112] For the reasons given above I will vary clause 9.5 of the CCC Agreement by deleting the words:
"(b) to become redundant, in which case the employee is entitled to the rights and benefits under the Enterprise Agreement, as amended from time to time."
and inserting in lieu thereof the following:
"(b) to become redundant, in which case such an election shall be deemed to be an Involuntary redundancy for the purposes of clause 23 of this certified agreement"
[113] The variation is to operate from today's date.
Appearances:
J. Zeeman for Civil Construction Corporation.
R. Flanagan for The Australian Workers' Union.
T. Benson for the Construction, Forestry, Mining and Energy Union.
D. Pyrke for The Association of Professional Engineers, Scientists and Managers, Australia
Hearing details:
2003.
Hobart:
October 9.
Decision Summary
Conditions of employment - certified agreement - variation of certified agreement - s170MD(6) Workplace Relations Act 1996 - ambiguity or uncertainty - various employees, building, metal and civil construction industries - applications sought to vary clause 9.5 concerning sale of CCC to remove ambiguity or uncertainty - findings made include mutual intent of parties at time Agreement made was if employee elected to be made redundant under clause 9.5 entitled to redundancy payments set out in clause 23 - during site meetings employees told would receive benefits set out in clause 23 - in response to questions regarding redundancy payments applicable if CCC sold and they elected to become redundant - Commission satisfied clause 9.5 is ambiguous and uncertain in relation to entitlements of employees if CCC is sold and they chose to become redundant - acknowledged offer made to all employees by Works Infrastructure would constitute acceptable alternative employment - obliged to give considerable weight to mutual intention of parties at time agreement made - employer's advice at site meetings relevant to consideration of fairness - variation made. | ||||
Civil Construction Corporation Enterprise Agreement 2002 [AG820635] | ||||
AG2003/7810 and ors |
||||
Ross VP |
Melbourne |
13 October 2003 | ||
Printed by authority of the Commonwealth Government Printer
<Price code G>
1 Minutes of the EBA Negotiating Committee meeting of 10 January 2002, see Exhibit AWU1; Mr Basuik's Witness Statement Exhibit AWU3 at paragraph 5; and Transcript 9 October 2003 at paragraphs 994-997
2 Transcript 9 October 2003 at paragraphs 988-989 and Exhibit AWU3 at paragraph 11
3 Minutes of the EBA Negotiating Committee meeting of 20 August 2002, Exhibit AWU1 at p.64
4 C2003/2134 and C2003/2160 respectively.
5 C2003/5773 and C2003/2798 respectively.
6 see Exhibit CCC2 at pp.25-27
7 Press Release, `Workers Given Extra Time to Accept Jobs', David Crean MLC, Treasurer, 30 September 2003
9 Re Victorian Public Transport Enterprise Agreement 1994, Print M2454, 7 June 1995 per Ross VP, Polites SDP and Grimshaw C at paragraph 3; and Re CFMEU Appeal, Print R2431, 25 February 1999 per Harrison SDP, Drake DP and Larkin C at paragraph 8. Re Tenix Defence Systems Pty Limited Certified Agreement 2001-2004, Print PR917548, 9 May 2002 per Ross VP, O'Callaghan SDP and Foggo C.
10 Re Victorian Public Transport Enterprise Agreement 1994, Print M2454, 7 June 1995 per Ross VP, Polites SDP and Grimshaw C at paragraph 3.
11 Print Q2603, 30 June 1998 per Munro J at paragraph 30.
12 Re Tenix Defence Systems Pty Limited Certified Agreement 2001-2004, Print PR917548, 9 May 2002 per Ross VP, O'Callaghan SDP and Foggo C.
13 Re CFMEU Appeal, Print R2431, 25 February 1999 per Harrison SDP, Drake DP and Larkin C at paragraph 12.
14 Re: Victorian Public Transport Enterprise Agreement 1994, Print M2454, 7 June 1995 per Ross VP, Polites SDP and Grimshaw C at p. 4; Re CFMEU Appeal, Print R2431, 25 February 1999 per Harrison SDP, Drake DP and Larkin C at paragraph 13; Re Tenix Defence Systems Pty Limited Certified Agreement 2001-2004, Print PR917548, 9 May 2002 per Ross VP, O'Callaghan SDP and Foggo C.
15 Print PR903843 at paragraph 7; also see Bell v Gillen Motors Pty Ltd (1989) 27 IR 324 at 331.
16 Re: Victorian Public Transport Enterprise Agreement 1994, Print M2454, 7 June 1995 per Ross VP, Polites SDP and Grimshaw C at 3-4.
17 Recommendation, 30 August 2003, (C2003/2134; C2003/2160) per DP Leary at paragraph 37
18 ibid., at paragraphs 36, 37 and 39
20 Transcript 9 October 2003 at paragraphs 358-360
21 ibid. at paragraphs 358-360
23 ibid. at paragraphs 391-401
25 ibid. at paragraphs 465-469
28 Exhibit AWU3 at paragraph 11
29 Transcript 9 October 2003 at paragraph 1005
31 ibid. at paragraphs 1008 and 1011-1012
32 ibid. at paragraphs 277-294
34 See generally Ms Jarvis' memorandum dated 26 June 2002, Subject: Site Visits - Enterprise Agreement, in Exhibit AWU1
35 Transcript 9 October 2003 at paragraph 307
36 ibid. at paragraphs 313-314
37 I note that at paragraph 369 of the transcript Mr Zeeman referred to the Whitestone meeting, but only in the context of asking a question about Ms Jarvis' understanding of how the agreement operated.
38 Transcript 9 October 2003, at paragraphs 307-317
39 ibid. at paragraphs 599-604; see also paragraphs 837-840
40 ibid. at paragraphs 818-819, 844,
41 ibid. at paragraphs 827-828, 850-853, 856-857
42 Exhibit AWU3 at paragraph 13
44 Transcript 9 October 2003 at paragraphs 1013-1014
45 Exhibit CCC3 at paragraphs 9-12
46 ibid. at paragraph 7; see also Transcript 9 October 2003 at paragraph 1059
47 Transcript 9 October 2003 at paragraph 1063
48 ibid. at paragraphs 1065-1066
50 ibid. at paragraphs 1067-1068
52 ibid. at paragraphs 361 and 377
54 ibid. at paragraphs 378-385, 412-417
57 ibid. at paragraphs 487-576
58 ibid. at paragraphs 1183, 1234 and 1252
59 ibid. at paragraphs 503-504 and 542
61 ibid. at paragraphs 506-507
63 ibid. at paragraphs 489 and 518
66 ibid. at paragraphs 533-538
67 ibid. at paragraph 547; see also paragraph 559
69 see generally Transcript 9 October 2003 at paragraphs 480, 487-488 and 551-559