PN1753

VICE PRESIDENT HATCHER: The first matter listed for today relates to the Rail Board. Mr Diamond and Mr Talbot, you appear for the RTBU, is that right?

PN1754

MR DIAMOND: Yes, we do.

PN1755

VICE PRESIDENT HATCHER: Mr Woods, you appear for the various rail industry employers?

PN1756

MR WOODS: Yes.

PN1757

VICE PRESIDENT HATCHER: Firstly, there was a statement of Gary Talbot advanced by the RTBU dated 16 October 2015. Do I understand that he is not required for cross-examination and his statement can simply be marked?

PN1758

MR WOODS: Yes, subject to - we lodged some objections in relation to the statement.

PN1759

VICE PRESIDENT HATCHER: Yes.

PN1760

MR WOODS: That was lodged on 8 March 2016 in accordance with the directions.

PN1761

VICE PRESIDENT HATCHER: I am not sure they're at hand, Mr Woods, but if you want to take us through the objections now, you may. Sorry, just hold on a sec. So we do have them, Mr Woods. I notice that, I'm just reading it now, it appears that the RTBU has very recently filed a further witness statement which is effectively responsive to those objections; is that, broadly speaking, correct?

PN1762

MR WOODS: Yes, we received that last night.

PN1763

VICE PRESIDENT HATCHER: Do you object to the admission of that statement?

PN1764

MR WOODS: On the same basis, there's a couple of paragraphs effectively in each which we say are actual evidence. The summation of the objections are the material is submissions, generalisations and unsupported understandings in terms of factual matters, so they're not actually leading to evidence. There's only a couple of paragraphs that actually meet the criteria of what is actually evidence.

PN1765

VICE PRESIDENT HATCHER: First of all, Mr Woods, do you oppose the admission, subject to your objections, of the most recent statement simply by reason of its lateness?

PN1766

MR WOODS: No.

PN1767

VICE PRESIDENT HATCHER: Does the union have a signed copy of that statement available? Mr Woods, our approach for the most part in these proceedings unless material is of a highly prejudicial nature, to note the objections and admit the material subject to submissions which might be made about their weight.

PN1768

MR WOODS: Yes.

PN1769

VICE PRESIDENT HATCHER: Is there any reason why we should take a different approach now?

PN1770

MR WOODS: No, I understand that approach.

PN1771

VICE PRESIDENT HATCHER: The objections are noted and you can deal with them further in submissions. So the statement of Gary Talbot dated 16 October 2015 will be marked exhibit 295.

EXHIBIT #295 STATEMENT OF GARY TALBOT DATED 16/10/2015

PN1772

And the further statement of Gary Talbot, dated 16 August 2016, will be marked exhibit 296.

EXHIBIT #296 STATEMENT OF GARY TALBOT DATED 16/08/2016

PN1773

So is that all the evidence with respect to this award?

PN1774

MR DIAMOND: In respect of the submissions, it is, yes.

PN1775

VICE PRESIDENT HATCHER: Yes, all right. So did the parties wish to proceed with I understood is fairly brief submissions about this issue now or do that at some later stage?

PN1776

MR WOODS: We're content to proceed now, if the Commission pleases.

PN1777

VICE PRESIDENT HATCHER: Do the parties have an estimate of time so we can give an indication to other parties as to when they might return as to how long these submissions should take?

PN1778

MR DIAMOND: I would imagine they would be quite brief.

PN1779

VICE PRESIDENT HATCHER: If I say they're finished by 11 o'clock, is that sufficient time?

PN1780

MR WOODS: Yes, I would have thought so.

PN1781

MR DIAMOND: Yes.

PN1782

VICE PRESIDENT HATCHER: For the other parties present, can I indicate that we won't reach the further matters, and the next matter will be the cross-examination of Mr Tegg, before 11 am. So if those parties wish to get in the coffee shop and intend to work for an hour, they may do so. So, Mr Diamond, are you going first?

PN1783

MR DIAMOND: Your Honours and Commissioner, prior to making my submissions, I would just like to draw your attention to the draft determination, the amended draft determination provided by the union, and we would like to make a quick amendment to that. At paragraph 2, which deals with: "6.4 Casual Employees".

PN1784

VICE PRESIDENT HATCHER: Where is it?

PN1785

MR DIAMOND: The very first page: "6.4 Casual Employees."

PN1786

VICE PRESIDENT HATCHER: Yes.

PN1787

MR DIAMOND: F(i), the amendment we would like to make is where the relevant penalty and insert the words after that "or loading." So, "Penalty or loading rate." And in regards to F - - -

PN1788

VICE PRESIDENT HATCHER: So penalty or loading rate?

PN1789

MR DIAMOND: Correct. And in regards to F(ii), exactly the same change, so: "Where the relevant penalty or loading rate." Just those two amendments, thank you.

PN1790

VICE PRESIDENT HATCHER: All right.

PN1791

MR DIAMOND: So the relevant amended draft determination for the Rail Industry Award 2010 provided by the RTBU sets out the relevant desired changes we are seeking. To be clear, we say the RTBU is not proposing to change the award functions, but rather is simply seeking changes to clarify its position. Specifically, the RTBU is seeking to make certain amendments to allay any confusion between the interaction of casual loading with penalty rates and with overtime rates, something which at present the award is silent on.

PN1792

At the time of award modernisation, casual employment was scarce within the industry. Since then, the rail industry has undergone many changes, particularly in the last few years. One of the most significant change is the casualization of labour in the industry. To highlight the lack of casuals prior to award modernisation, we point to the pre-reform rewards that form the basis for the Rail Industry Award of which only three of the 12 included casual employment as a category of employment.

PN1793

I will point to paragraph 12 of our submissions where we have mentioned three awards. I will just mention what they are very quickly. The Locomotive Operations Award 2002, the Rail Traffic Operating Workshops and Miscellaneous Grades Award 2003 and the Rail Salaried Employees Award 2003. These three awards are pre modern awards, however, do not include provisions for calculating overtime and penalties for casual employees.

PN1794

Given the absence of sufficient provisions in pre modern awards, we have, in our submission at paragraph 13, provided a non-exhaustive list of state and National agreements and the relevant provisions to highlight how they have been dealt with in regards to the interaction between casual loading with penalty rates and with overtime rates. The dominant trend is that casual loading is paid in addition to overtime and penalties.

PN1795

In our submissions we also pointed to the Building and Construction On-site Award and the building industry generally as being similar. There is substantial crossover between these industries as evidenced by Mr Gary Talbot's witness statements marked exhibit 296 and 295, in particular, in regards to 296 at paragraph 6. Basically with the proliferation of labour hire servicing the sector, these new service providers are not covered by the Rail Industry Award. In order to be covered by that award, they would be required to be rail transport operators, but they are not and, rather, they are covered by the Building and Construction On-site Award. In that award - - -

PN1796

VICE PRESIDENT HATCHER: So the employers covered by the agreements identified in paragraph 13, would they otherwise be covered by the award? Some of them at least look like labour hire providers?

PN1797

MR DIAMOND: They are labour hire and - let me just very quickly - it was paragraph 13. Paragraph 11, my apologies, I withdraw that. Paragraph 11. These are labour hire companies. These companies function under the building and construction award when they provide services to the rail industry.

PN1798

VICE PRESIDENT HATCHER: They're all labour hire?

PN1799

MR DIAMOND: They are, yes.

PN1800

VICE PRESIDENT HATCHER: I was actually looking at some of the agreements identified over the page, are they all the same, are they?

PN1801

MR DIAMOND: I am sorry, I missed that question.

PN1802

VICE PRESIDENT HATCHER: Over the page at paragraph 13, those agreements referred to there.

PN1803

MR DIAMOND: These are the pre modern award agreements?

PN1804

VICE PRESIDENT HATCHER: Only the pre modern award agreements.

PN1805

MR DIAMOND: That deal just generally with penalty rates and how they should apply and how casual loading should apply with casuals. What we're saying is that predominantly both in regards to the pre modern awards that casual loading and penalty rates are both applied and that's the predominant trend, pre modern award, or, rather, in regards to those agreements, my apologies.

PN1806

VICE PRESIDENT HATCHER: Those agreements, well, they're not all pre modern. There's John Holland 2015, et cetera, et cetera.

PN1807

MR DIAMOND: That's correct.

PN1808

VICE PRESIDENT HATCHER: So is John Holland covered by the Construction Award when it works in the rail industry or the Rail Award?

PN1809

MR DIAMOND: I would need to double check that. My understanding would be and it probably is that they are still linked to the rail industry and they are likely not to be, but I would need to confirm that.

PN1810

VICE PRESIDENT HATCHER: All right.

PN1811

MR DIAMOND: So when it comes to the application of casual loading and penalty rates, should the Commission not agree with our position, we're saying that a situation would arise where potentially employees could be working side by side under different awards but earning different amounts and that may result in individuals moving out of the rail industry into an organisation like a labour hire company in order to attract the higher rates should the Commission not agree with our position.

PN1812

DEPUTY PRESIDENT BULL: When you say they are working side by side, are they doing the same duties?

PN1813

MR DIAMOND: Yes, and the only variance is that as a labour hire organisation, they're not a rail transport operator and therefore are not covered by the relevant industry award, therefore they're under the alternate award, being the Building and Construction On-site.

PN1814

My friend's submissions on behalf of Horizon and others at paragraph 5 seem to concede that weekend penalty rates should include the casual loading and a penalty loading both calculated on the base rate of pay. So we don't see that there is any contention in that. The key contention, therefore, seems to be two items. The first is that whether casual loading should apply on public holidays. And the second is whether casual loading should apply when overtime rates apply, so during overtime.

PN1815

I will deal with the public holiday issue first. Permanent employees continue to accrue benefits on public holidays regardless of if they work. They continue to accrue annual leave. They continue to accrue personal leave. A casual working on such a day should continue to receive the casual loading for the same reasons they would receive casual loading on weekends which is a matter, the latter, being something that is not in contention. We find it strange that there is an objection to receiving casual loading on public holidays when it's exactly the same situation as that weekend scenario and yet it's actually been objected to.

PN1816

I will turn now to the interaction between casual loading and the overtime rate. We say that both casual loading and overtime loading must be paid for overtime hours worked for casual employees. Both components should be calculated on the base rate separately and then added to the base rate. The amendments we propose to the award reflect this calculation method. Casual loading must continue to apply even during overtime for the loss of benefits inherent in permanent employment. Although things like personal leave and annual leave do not accrue during overtime, these are only part of a non-exhaustive list and were only inserted into modern awards as an indication of the reasons for casual loading.

PN1817

In regards to the reasons for receiving casual loading and it being a non-exhaustive list, my friend has alluded to one of the reasons for the public holiday not being able or not intentionally applying. That it shouldn't apply to public holidays is that permanent employees are not required to work on a public holiday and that's a benefit that they have. That is outside of that list, therefore, I think we are in the same mind that that list itself is not exhaustive. We turn to things like that as a casual employee, there are vicissitudes in that work. There is no certainty about the hours and that, in itself, is enough for the casual loading to continue to apply.

PN1818

Moreover, when drawing a comparison with the Building On-site Award which we say is similar or a similar set of circumstances, that award, the Building and Construction On-site Award, has a casual conversion clause. The Rail Industry Award doesn't. Therefore, these casual employees have no right of escaping the casual cycle they are trapped in and should be compensated for it regardless of if it's during their ordinary hours or during overtime hours.

PN1819

In order to ensure casual employees are paid adequately and fairly under the Rail Industry Award, the Commission must ensure that casual loading applies to both ordinary and overtime hours. I will now quickly turn to some items in my friend's submissions. I note in particular in regards to his alternative submissions, he has put forward a position that should the Commission take our view on this, the union's view, some other amendments.

PN1820

Now, we say that these amendments aren't necessary. We say that the amendments that we have proposed in the body of the agreement clearly articulate the loading should be applied and the way that overtime penalties should be applied and that to go through and make such substantial changes doesn't necessarily better clarify the position of the award for potential employees that may be covered by it. Nothing further, thank you.

PN1821

VICE PRESIDENT HATCHER: You said there was no casual conversion clause in this award. Is this award - I don't have it at my fingertips - the subject of the ACTU's common claim about casual conversion or not?

PN1822

MR DIAMOND: Yes, it is, and those submissions we are in agreement with.

PN1823

VICE PRESIDENT HATCHER: So if that claim was successful, this award would have a casual conversion clause in it?

PN1824

MR DIAMOND: We understand that at this point in time, as it sits, it's not included. We still point to the vicissitudes of casual work as opposed to permanent employment as part of that non-exhaustive list. That should be considered in receiving casual loading.

PN1825

VICE PRESIDENT HATCHER: In your variation, the fourth variation, what's the purpose of that?

PN1826

MR DIAMOND: Is that in regards to the verbal amendments I have just made?

PN1827

VICE PRESIDENT HATCHER: It's changes 6.4E. So it says that casual loading is paid instead of annual leave, paid personal carer's leave, et cetera.

PN1828

MR DIAMOND: So looking at some of the other awards including the Building and Construction On-site Award, and I won't try and cite the terminology in that at the moment, the last wording in that 6.4E referred to - and I am paraphrasing here - and other entitlements of permanent employees. It seemed to do a catch-all encapsulation of why casual employees receive that casual loading. We're saying that the reason for casual loading is not an exhaustive list. And, as such, that wording should be removed. I would say that my friend's submissions have also alluded to other reasons why casual loading should not apply that are independent of that list. So I would say that we're potentially in agreement that that list actually shouldn't be exhaustive and that last few words seem to be a catch-all.

PN1829

VICE PRESIDENT HATCHER: Then in the third variation, that simply seeks to have the overtime penalty rate. Does that load onto the casual rate or the unloaded casual rate? Perhaps I put that badly. Is the penalty rate loaded on top of the casual loading or not?

PN1830

MR DIAMOND: No, it's not. So it would function as two separate calculations on the ordinary rate on the base rate, added together and then added to the base rate, so it is not a penalty on a penalty.

PN1831

VICE PRESIDENT HATCHER: So the ordinary rate, you apply the penalty rate to that for overtime?

PN1832

MR DIAMOND: Yes

PN1833

VICE PRESIDENT HATCHER: But then you would add the 50 per cent as calculated on the ordinary rate, not the penalty rate.

PN1834

MR DIAMOND: Correct, yes.

PN1835

VICE PRESIDENT HATCHER: Yes, all right, thank you.

PN1836

MR DIAMOND: Thank you.

PN1837

VICE PRESIDENT HATCHER: Mr Woods.

PN1838

MR WOODS: In terms of the starting point of the matter, it is, of course, the basis of the jurisdictional preliminary decision that was made by the Commission in 2014 FWCFB 1788. I'm sure that in the course of this process the Commission is well aware of that judgment and has probably been taken to it many times in terms of what is the test that is set out and summarised and finalised at paragraph 60 of that decision. Those issues about assuming that the original award met the objective, the test is whether or not the changes proposed and a variation meet the objective, the question of whether or not there is cogent evidence presented to support the amendment, those matters are referred to in our submissions but they, of course, are dealt with in detail particularly at point number 3 in paragraph 60 of that decision. I'm sure the Commission - I haven't brought copies because I'm sure you have got that many times over.

PN1839

Turning then to the questions of the evidence as presented, I won't go through the objections that are set out in our letter of 8 March 2016, which I will leave the Commission to address. In the end, the question of turning to what actual evidence is given, I the statement of 16 October 15, ultimately we would say that only part of paragraph 6 meets the requirement of actual evidence to be evidence of which Mr Talbot can give. And that is the last sentence and the list of five agreements that he identifies because these are agreements that he purports to say have as enterprise agreements containing the relevant casual rate of loading for the weekend and public holidays which the whole of the statement contends.

PN1840

But ultimately, therefore, what we have is those five agreements that he is aware of and I do note that then we didn't object to the preliminary statements in paragraph 1 and 2 where he has 10 to 15 national and state agreements that he does per year. So just dealing in terms of what is there as in evidence, he says he does 10 or 15 agreements. He does say in paragraph 6 that the list of five is an inclusive list because these ones include the proposition, but we don't know more compared to what he has done over the five years or nearly five years between the commencement of the award and the giving of that statement.

PN1841

The statement of 16 August that has been provided, again only talks in the same objections in terms of generalisations flow in respect of paragraph 4. The provisions of paragraph 3 provide no detail only that he refers to the names of the employers for whom he has had agreements and therefore has got no weight. And then he affirms that paragraph 6 and 7 of the previous statement contain clauses. Now, he has only been involved in those identified at five, but not at seven. So the weight of that is only then going to the question of agreements.

PN1842

Then in respect of his final paragraph and a submission that Mr Diamond has made, it is our submission that - - -

PN1843

VICE PRESIDENT HATCHER: Sorry, Mr Woods, you might be (indistinct), can we just go back to some basics because we have got a lot of matters to deal with in these proceedings.

PN1844

MR WOODS: Yes.

PN1845

VICE PRESIDENT HATCHER: Mr Diamond started off with the proposition that his application is clarificatory rather than about its substantive change in respect of the casual loading being paid on overtime penalty rates, weekend penalty rates and public holiday penalty rates. So do you agree with that proposition or not?

PN1846

MR WOODS: No, it's a variation.

PN1847

VICE PRESIDENT HATCHER: So what is the current position?

PN1848

MR WOODS: The current position is that the loading is paid for ordinary hours worked. Now, those ordinary hours may be worked on a weekend. They may be worked Monday to Friday. They may be worked - the public holiday position is slightly different because of the nature of what's a public holiday and what the rates are relevant for. But our position is that the loading is paid for ordinary hours and the award in its current form and in the current draft, in the current form at 10.3A, it says in respect of the hours:

PN1849

A casual employee's ordinary hours of work are the lesser of 38 hours per week or the hours required to be worked by the employer.

PN1850

So that therefore identifies if the employer says you have got these seven hours to work, they're your ordinary hours. If the employer says, "I want you to work 38 hours", then that's 38 hours and that gets you to the maximum. If the employer says, "I want you to work 40 hours per week", then you change from being past the ordinary hours, if that was to occur. But the loading is there for ordinary hours - - -

PN1851

VICE PRESIDENT HATCHER: Sorry, we don't have the award in front of us. Is a loading expressed as applicable only to ordinary hours, is it, or - - -

PN1852

MR WOODS: It does say in 10.3B:

PN1853

For each hour worked, a casual employee would be paid no less than one-38th of the minimum weekly rate of pay for their classification in clause 14, plus a casual loading of 25 per cent.

PN1854

We say that in respect of the hours worked, it's talking about the ordinary hours worked in respect of that work.

PN1855

SENIOR DEPUTY PRESIDENT HAMBERGER: So if a casual works 40 hours a week, what do they get paid?

PN1856

MR WOODS: If they're paid 40 hours for 40 hours and they've moved beyond the ordinary hours, they get the overtime rate and they get the loading.

PN1857

SENIOR DEPUTY PRESIDENT HAMBERGER: And that's on the minimum rate, it's not on the loading rating.

PN1858

MR WOODS: Yes, because you have gone past the 38. So we say to load it up for a weekend, for example, is a new proposition because if the employee worked ordinary hours on a weekend, they would get their loading because it's ordinary hours. But to load it up otherwise, is not clarification.

PN1859

VICE PRESIDENT HATCHER: So I assume there is loadings for ordinary hours on weekends?

PN1860

MR WOODS: Yes.

PN1861

VICE PRESIDENT HATCHER: So what are they?

PN1862

MR WOODS: The ordinary hours, so Sunday is a 100 per cent loading and that's in clause 23.6 of the current award and I think the public holiday is 150. I just can't put my hand on it, sorry, your Honour, in respect of Saturdays. It may be that Saturdays is just treated as ordinary time given the nature of the rail industry.

PN1863

VICE PRESIDENT HATCHER: In any event, let's take Sundays. So if you work ordinary hours on Sundays, do you get the 100 per cent on the ordinary rate and also 50 per cent on the ordinary rate or not?

PN1864

MR WOODS: Yes.

PN1865

VICE PRESIDENT HATCHER: Does the same apply to public holidays, if you work ordinary hours on a public holiday?

PN1866

MR WOODS: The issue for public holidays which we have submitted is that the nature of public holidays as across all industries is different because it's an issue of a day that you're not otherwise required to work.

PN1867

VICE PRESIDENT HATCHER: I was only asking a question about what the award currently provides for in your interpretation.

PN1868

MR WOODS: In our interpretation, well, the loading on a public holiday is 150 per cent of the ordinary hour base rate for working on a public holiday. So the result of that, if there is a 25 per cent loading, that's paid separately in respect of it.

PN1869

DEPUTY PRESIDENT BULL: Mr Woods, if the unions say your application is simply a clarification, you say it's a variation, what's been happening in the last six years then in terms of the union and yourselves sorting out what should be paid? Has there been a dispute ongoing or what?

PN1870

MR WOODS: Not that I'm aware of.

PN1871

VICE PRESIDENT HATCHER: Does this awards actually apply to anybody?

PN1872

MR WOODS: I know that there's at least somebody in WA that it applies to. It's an industry that is full of enterprise agreements and, of course, the nature of an enterprise agreement is inherently different to an award both in terms of function and the basis upon which it is reached. The proposition that because something is in a number of agreements doesn't automatically mean it should be in an award because of the fundamental difference.

PN1873

VICE PRESIDENT HATCHER: Commissioner Roe has got a question.

PN1874

COMMISSIONER ROE: Can I ask, reading your submission and reading the current exposure draft wording, it appears to me that you accept the current wording it might imply but it doesn't specifically say that a person, a casual employee, working ordinary hours on a Sunday will be paid 225 per cent. I think it's the most rational. It seems the most rational interpretation, as you suggest, and as the union suggests. But wouldn't you agree it is not clear in the current wording of the exposure draft?

PN1875

MR WOODS: I mean, the exposure draft effectively repeats what's in the current award. The fact that we have identified it, the fact that someone says they think it's unclear without any evidence of a lack of clarity of operation, is just looking at the words which is why - - -

PN1876

VICE PRESIDENT HATCHER: You won't have evidence of lack of clarity of operation if no one or hardly anyone is applying the award because I think all your clients are under agreements, aren't they?

PN1877

MR WOODS: Yes. No, sorry - yes - no, the list here - we have at other times. In these proceedings I have appeared in relation to a couple of WA employers, they are not still there and I know that they, at least one of those does apply the award.

PN1878

VICE PRESIDENT HATCHER: All right.

PN1879

MR WOODS: In terms of a principle of applying this to overtime, I have brought for the Commission just an extract from the 2008 decision that dealt with the Rail Award just for convenience. I didn't include the entirety of that decision. And the parts that I seek to draw the Commission's attention to is paragraph 50 as extracted which identifies what the casual loading is for which is unsurprising. The balance of the decision I have extracted in respect of the Rail Industry Award is extracted because there is no discussion about casuals in the rest of the published decision and so we are left simply with the award and its operation as it came out.

PN1880

So in terms of the principles for the Commission must face now in making a decision, the decision was that there should be no other statement and effectively no other enlargement of the operation of the loading and the penalties such as in respect of overtime. And the fact that the award in the exposure draft and in its original form contains the reference to what the loading is for reinforces the fact that for overtime the loading is not relevant because of the nature of the entitlements for which it is paid both from paragraph 50 of that decision and as repeated in the current award at 10.3(c) and in the exposure draft at 6.4(e). Full time employees don't accrue additional annual leave or personal leave or redundancy entitlements in respect of working overtime. So if that's what the loading is for, that reinforces the proposition that it shouldn't be paid for overtime worked by casual employees.

PN1881

VICE PRESIDENT HATCHER: I notice at paragraph 243 of that decision, the last sentence says: "All parties accepted that it was not likely that any employee was award reliant." That is, on one view the main relevance of this argument is to the extent the award serves as a reference point for enterprise bargaining rather than - - -

PN1882

MR WOODS: It's true that substantially that's what it does. It's true just because of the nature of the way the industry has unfolded, but that doesn't change the proposition as to how it should be determined. And that, in our submission, inappropriateness to draw from an enterprise agreement and say because something is in an enterprise agreement it should therefore be in the award. That just doesn't follow.

PN1883

Another proposition that my friend makes is this crossover and inter-relationship with the Construction Award. To the extent that there is labour hire companies and it's been identified as labour hire companies to whom reference has been made, of course we have the standard clause or standard coverage clause in clause 4.4 of the award in relation to its application for on-hire employees who are supplied because 4.4 has got the traditional wording of this award covers any employer which supplies labour on an on-hire basis to the industry as identified.

PN1884

So that standard clause means that an on-hire employer, an employer who is a labour hire, might have lots of awards because of where they apply their employees to and but if they operate - if they come into work covered by the other coverage of the award then that's where this award would apply.

PN1885

VICE PRESIDENT HATCHER: So you disagree that the Construction Award applies to those labour hire people?

PN1886

MR WOODS: Yes, when they work in the rail industry, yes. It's quite likely to apply to the same employees if they work somewhere else, but that's the nature of that and nature and purpose for that labour hire clause when it was inserted as part of the original proceedings. And that may well be to the extent that my friend refers to labour hire enterprise agreements operationally for a business a very good reason why they will have an agreement knowing who they are trying to apply to. And presumably when those agreements are source, the BOOT test is applied across the range of awards in which their employees would ultimately work and applied to different industries.

PN1887

VICE PRESIDENT HATCHER: So if you are constructing railway line, what award covers you?

PN1888

MR WOODS: It depends whether or not you are supplied to a rail transport operator. So the rail transport operator splits into the rolling stock manager, so people that operate the trains, someone like MTR to the extent that it's a rolling stock operator or Sydney Trains or NSW Trains. And if take NSW Trains as a local simple example, it only operates as a rolling stock manager. It doesn't do anything. It doesn't do any construction work. Sydney Trains does both, for example. So the result of that is that they fit both criteria to be a rail transport operator.

PN1889

But if a labour hire person was supplied to either of them to do work, they would come under the Rail Industry Award. If you are building a railway line in the middle of nowhere that's not a functioning railway line, then if you are engaged by a construction company to do that then the Construction Award would apply because you're just building a railway. It might have infrastructure that's going to be used, but at that stage you're not a rail infrastructure manager, you're a builder. So that's a distinction in terms of who does the doing. If in that example Sydney Trains was building a new piece of track as an infrastructure manager and the labour hire was supplied, the Rail Award would apply because it applies to the employer in the industry.

PN1890

They are really the only points beyond the written submissions that I sought to highlight.

PN1891

VICE PRESIDENT HATCHER: All right, thank you. Anything in reply, Mr Diamond?

PN1892

MR DIAMOND: Yes, thank you, your Honours and Commissioner. Just one quick point in regards to this issue about labour hire. Our understanding of the Rail Industry Award is that clause 4.4 specifically says: "The award covers any employer who supplies labour on an on-hire basis in the industries set out in clause 4.1." Now, the pivotal point here is: "In the industries set out in clause 4.1." Clause 4.1 provides: "The industry award covers employers throughout Australia who are rail transport operators." Now, I understand why there is some confusion around this, but, in our view, this specifically says that you have to be a rail transport operator in order for this award to apply.

PN1893

VICE PRESIDENT HATCHER: So if the operator engages a contractor to say repair a piece of line and the contractor engages labour hire for the labour, then that's not Rail Industry Award because the employer is not a rail industry operator?

PN1894

MR DIAMOND: That is our understanding and just to elaborate a little bit on that, that is assuming that that - if I may use the word 'subcontractor' or that individual, the organisation that they belong to is not itself a rail transport operator.

PN1895

VICE PRESIDENT HATCHER: Do you agree with that, Mr Woods?

PN1896

MR WOODS: Yes.

PN1897

MR DIAMOND: Nothing further, thank you.

PN1898

VICE PRESIDENT HATCHER: All right. I thank the parties for their submissions. You are now excused and we will adjourn and resume at 11 am.

SHORT ADJOURNMENT [10.49 AM]

RESUMED [11.06 AM]

PN1899

VICE PRESIDENT HATCHER: All right, Mr Nguyen, you are going to call Mr Tegg for the purpose of cross-examination; is that right?

PN1900

MR NGUYEN: That's correct, your Honour. Just before I call Mr Tegg, your Honour, we just have one witness statement which hasn't been marked yet in the proceedings. It's the witness statement of Mr Liam Waite - W-a-i-t-e - which was attached at 12.10 to our original submission on 13 October 2015. I did seek confirmation from the AO Group and the Chamber of Commerce and Industry yesterday that they didn't require him for cross-examination and no party indicated in the earlier proceedings in March that they required him.

PN1901

VICE PRESIDENT HATCHER: So Waite, W-a-i-t-e?

PN1902

MR NGUYEN: That's correct.

PN1903

VICE PRESIDENT HATCHER: We don't have it in front of us, but we find it and look at it, we will administratively give it a marking unless there's some other issue arises.

PN1904

MR NGUYEN: Thank you, your Honour.

PN1905

VICE PRESIDENT HATCHER: Had we marked Mr Tegg statement earlier, Mr Nguyen?

PN1906

MR NGUYEN: Not yet, your Honour.

PN1907

MR FERGUSON: Before we get to that, just one unusual matter just arising. I'm advised by Mr Nguyen that Mr Tegg doesn't have a clean copy of his statement with him. He's got some version that has some sort of notes all over it. I don't know what those notes are. It seems somewhat unusual that he give evidence with notes all over his statement and it's certainly unfair that we don't know what they are.

PN1908

VICE PRESIDENT HATCHER: We will supply a clean copy to the witness. Come forward, Mr Tegg.

<WARREN JOSEPH TEGG, AFFIRMED [11.08 AM]

EXAMINATION-IN-CHIEF BY MR NGUYEN [11.08 AM]

PN1909

MR NGUYEN: Mr Tegg, have you prepared a statement in these proceedings?‑‑‑I have.

PN1910

The statement that you have prepared, is it this statement that was uploaded to the Fair Work Commission website on 23 March with 60 paragraphs?‑‑‑Let me just check that. That's correct.

PN1911

Are there any changes that you would like to make to the statement?‑‑‑Yes, I would like to add my middle name, Joseph, to the affirmation at the very top there. In paragraph 27, at the end of the first sentence I would like to add the words, "Or that they didn't know."

PN1912

So the full sentence at 27 will read:

PN1913

There were 1,960 respondents that replied that their business was covered by a modern award with a casual conversion clause in it or that they did not know -

PN1914

- full stop?‑‑‑That's correct, yes. In paragraph 31 in the second sentence, I would like to replace the word "two" with the word "three".

PN1915

So the sentence will now read:

PN1916

For example, three respondents said that two per cent of their eligible workers applied for conversion and that two per cent of those eligible employees who requested conversion were granted permanent employment

*** WARREN JOSEPH TEGG XN MR NGUYEN

PN1917

Yes?‑‑‑That's correct. And paragraph 49, I would like deleted.

PN1918

Deleting paragraph 49?‑‑‑Thank you.

PN1919

The statement as amended, is that true and correct to the best of your knowledge, Mr Tegg?‑‑‑It is.

PN1920

The union tenders Mr Tegg's statement.

PN1921

VICE PRESIDENT HATCHER: Does this have a date on it, Mr Nguyen?

PN1922

MR NGUYEN: There's no date, your Honour, but it's the version that was uploaded to the Fair Work Commission website on 23 March. That's dated on the website.

PN1923

VICE PRESIDENT HATCHER: The statement of - - -

PN1924

MR FERGUSON: Your Honour, I would make one submission.

PN1925

VICE PRESIDENT HATCHER: Yes.

PN1926

MR FERGUSON: We have identified in the statement a number of elements of the statement that could be subject to objection. In broad terms, if I could address the Bench now while the Bench is focussing on it, there are elements of the statement that are in the nature of opinion, either advanced on the basis that there's - or advanced without a proper basis, or they are in large part a submission about what weight the Commission should give this survey. I am conscious of the approach adopted in previous rulings in relation to such matters and we are content to deal with that in our final submissions in terms of making submissions about the weight that should be given to it, but we did want to raise that now while the Bench is focussed on it.

PN1927

VICE PRESIDENT HATCHER: All right, well, that objection is noted and can be dealt with in submissions. The statement of Warren Joseph Tegg which was uploaded to the website for this case on 23 March 2016 we have marked exhibit 297.

EXHIBIT #297 STATEMENT OF WARREN JOSEPH TEGG UPLOADED TO FWC WEBSITE ON 23/03/2016

*** WARREN JOSEPH TEGG XN MR NGUYEN

PN1928

VICE PRESIDENT HATCHER: All right.

CROSS-EXAMINATION BY MR FERGUSON [11.11 AM]

PN1929

MR FERGUSON: Morning, Mr Tegg. I have a small number of questions for you. So I understand you're employed by the AMWU as a national research officer?‑‑‑That's correct.

PN1930

You have been employed in that role for approximately 16 months?‑‑‑At the time that the statement was written, yes.

PN1931

You have continued in that role since?‑‑‑That's correct, yes.

PN1932

I have been on your LinkedIn profile page?‑‑‑Yes.

PN1933

It states that:

PN1934

In this role, I am responsible for preparing submissions to government inquiries on a range of industrial, economic and social issues affecting AMWU members. To achieve this, I have designed, collected and analysed original research. My considerable experience working within government has enabled me to frame complicated issues in straight forward language that appeals to policy makers and to design policy recommendations that can be readily understood and implemented.

PN1935

Would you agree that that's an accurate description of your role with the AMWU?‑‑‑Yes.

PN1936

So take it from that, given the nature of your role, it doesn't involve - or the primary function of it doesn't involve you talking directly with AMWU members in a significant way?‑‑‑No.

PN1937

And by extension, I take it that you don't commonly speak to the employers of those members?‑‑‑I should point, I do so but in a very limited way on a handful occasions during my time.

PN1938

To clarify then, in your role, you are not involved in discussions with employers about the eligibility of members to convert casual employees?‑‑‑I have only done that on one occasion.

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1939

On one occasion?‑‑‑Spoken with one employer about a casual conversion issue in their workplace, yes.

PN1940

So that is the extent of your experience?‑‑‑That is the extent of my hands on experience with casual conversion with an employer, yes.

PN1941

I suppose by extension, you would have very limited experience in terms of understanding or observing employer practices generally in relation to the engagement of casual employees?‑‑‑Yes, that isn't part of my role at the AMWU.

PN1942

Based on your experience more broadly, I assume you don't have direct knowledge of the pattern of casual engagement of employees adopted by employers in all of the industries covered by the survey, the joint employers survey?‑‑‑Certainly not.

PN1943

I am just going to give you a copy of the questions that underpin the joint employer survey attached to the statement of Ben Waugh?‑‑‑Yes.

PN1944

I have it here and copies for the Bench.

PN1945

VICE PRESIDENT HATCHER: Thank you.

PN1946

MR FERGUSON: I will just note this is a copy of the version that was attached to the statement of Mr Waugh?‑‑‑Yes.

PN1947

But, for convenience, I have numbered the questions on the left-hand side?‑‑‑Right.

PN1948

You'd agree with me that the way the survey was set up was that certain questions could only be answered if the relevant employer had responded in a particular way to earlier questions?‑‑‑Yes, some of the questions that was the case.

PN1949

I think we might be able to describe that as, I suppose, survey logic?‑‑‑Yes.

PN1950

You would agree with me that the logic underpinning the questions that were asked in the survey can actually be identified from the survey questions which I have just provided to you?‑‑‑Yes, yes, the text just underneath the bolded question indicates that.

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1951

So by way of example, question 7, you can see there that there is a line underneath the bolded text?‑‑‑Yes.

PN1952

That explains the survey logic, if you will, that applies?‑‑‑Yes.

PN1953

Now I will just take you briefly to paragraphs 8 and 9 of your statement?‑‑‑Yes.

PN1954

You there refer to respondents who indicated that their business was not covered by one or more modern awards or that were unsure if their business is covered by one or more modern awards?‑‑‑M'mm.

PN1955

Can I just confirm that those responses were provided in answer to question 6, weren't they?‑‑‑That's correct, yes.

PN1956

That question was: "Is your business covered by one or more modern awards?"?‑‑‑M'mm.

PN1957

I will just take you to question 7?‑‑‑Yes.

PN1958

That question said: "Which modern award covers your business?" And then there was a list of 122?‑‑‑Yes.

PN1959

You would agree the respondent could only answer that question and select one of the awards if they answered 'yes' to question 6?‑‑‑Yes, though I understand that's the only question in the survey that they were excluded from answering. So while that is correct, they weren't asked for which specific awards covered their employees. There are, to my knowledge, no other questions to which a response of 'no' or 'unsure' to question 6 would have excluded them from answering.

PN1960

You're aware that for the purposes of these proceedings, AI Group has advanced a certain analysis of the survey results which has been presented to the Commission on an award by award basis?‑‑‑Yes, both on an award by award basis and in the body of its main submission overall. So while certainly these respondents - sorry - - -

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1961

So that analysis was presented in the statement of Mr Waugh which included award by award analysis and there was also some analysis provided in our further submissions, reply submissions?‑‑‑Yes, of all the respondents - pardon me - grouped together for overall statistics on various things. So there was an analysis of all respondents that was presented to the Commission as well as an award by award summary that was prepared by Mr Waugh in his statement, yes.

PN1962

That award by award analysis that I have referred to, that was based on the responses - well, you would agree that that was based on the responses given at question 7?‑‑‑Yes, that's my understanding, yes.

PN1963

So you would agree that if a respondent was not asked to select any modern award at question 7, that the responses of those employers is not included in any of the survey analysis presented to the Commission that relates to survey respondents covered by a particular modern award?‑‑‑Yes, that they would have been for the overall data.

PN1964

Yes, but excluded from the award specific data?‑‑‑Certainly that is my understanding, yes, that's correct.

PN1965

I will just take you question 20. The question asks: "What proportion of your casual employees is covered by a modern award"?‑‑‑Yes.

PN1966

Then it goes answers: none, some, most or not sure?‑‑‑M'mm.

PN1967

You would agree that if an employer has selected "not sure", that means an employer does not know what proportion of its employees are covered by a modern award?‑‑‑Yes.

PN1968

But you would agree that it doesn't necessarily mean that they do not employ any casual employees not covered by a modern award?‑‑‑It may well, yes.

PN1969

The question is written in the present tense, isn't it? That is, it asks the employer to identify the proportion of casual employees that at that time are covered by a modern award?‑‑‑Yes, it is only asked in the logic of people who paid a casual employee in the last month. So the logic here, yes, at question 15 - - -

PN1970

Sorry, at question 20?‑‑‑Yes, so question 20 was only asked of people who had answered 'yes' to question 15 which was, "Have you paid a casual employee in the last month?"

PN1971

Yes, I understand?‑‑‑You're asking people who either do have or have very recently had casual employees.

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1972

But those that answered 'none', it's quite possible that they could have employed a casual employee in the last month?‑‑‑It is.

PN1973

Can I take you to paragraph 31 of your statement? That paragraph appears to relate to the two questions that were asked or identified in A and B of the above paragraph. Those questions state, firstly:

PN1974

Since 1 January 2010, what percentage of those casual employees who were entitled to request conversion to permanent employment have made a request to convert to permanent employment? And (b) what percentage of those employee requests to become permanent were granted by your organisation?

PN1975

You identify that, in the responses to those, there was a group - some 60 cases - where they said now I think it's three per cent of their eligible workers applied for conversion in response to the first question and then in response to the second question, they say two per cent?‑‑‑Sorry, if I could just quickly clarify. My clarification of my - the correction to my statement was that there were three respondents that had said two per cent to both. So I may have been confusing when I was clarifying, sorry. There were three occasions upon which - - -

PN1976

As opposed to 60 cases?‑‑‑No, no, so of those 60 cases, three of them, the word "two" rather than the number "2" was what I corrected, my apologies. So it was, yes, in that sentence it should be, "three, two per cent, two per cent."

PN1977

But in either case, you say there were 60 cases where they provided the same answer?‑‑‑Yes, for both the first and second questions.

PN1978

You then say that there is no logical reason for that?‑‑‑That's correct.

PN1979

I put to you that an obvious logical explanation could simply be that all of the requests that the respondents were referring to in those questions were granted, so the respondents were simply putting the same number?‑‑‑So what you're suggesting by my understanding is that they were using a number rather than a percentage which is to say there were two employees who did this and two of them - both of them?

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1980

No, what I'm suggesting is that they may have put a percentage that requested and that in error or otherwise they have put that, given that all of them converted, they have put the same number in answer to the second question to indicate that all of the requests were granted, that's quite an obvious or plausible explanation?‑‑‑I would argue that's consistent with my analysis which is that they either didn't understand both questions or the difference between them, which is to say, the first question is a question of a percentage of every casual employee who has worked for you that was eligible since 2010 and so that should - so in your scenario - - -

PN1981

So you're saying - sorry to cut you off, and I don't mean to - essentially is that they may not have understood the subtlety of the question?‑‑‑Well, to answer the same percentage for both rather than as would be the case here in your hypothetical, two per cent for the first one and a hundred for the second one which is to say, "Two per cent of my employees have asked and 100 per cent of them were granted", would be, in your hypothetical example, the correct response to those questions taken at face value. My argument is that we don't know what these people meant, but it is extraordinarily unlikely that of 171 respondents, and that's the number that I've whittled it down to through the previous paragraphs of people who can share modern award knowledge that a third of those respondents have all made the same mistake. And if that is the case, are they making the mistake on the first question, are they making the mistake on the second question? Do we even know what mistake they are making? Are they putting in the actual number rather than the percentage and given, as I highlight further on, the difficulty in calculating the percentage, I suppose the question becomes: what are these respondents telling us and do we have any idea what that is? Are they consistent with themselves and are they consistent with our understanding of what question we are asking them?

PN1982

VICE PRESIDENT HATCHER: I suppose to give two per cent for both as answer for both questions, even mathematically you'd have to have a very large number of eligible workers for that?‑‑‑2,500 employees, yes, would be the minimum number for which two per cent and two per cent could result in a whole number being one employee out of 2,500.

PN1983

SENIOR DEPUTY PRESIDENT HAMBERGER: But that's just three. I mean, you're right, but that's just three cases out of 60 - out of the 171?‑‑‑Well, certainly.

PN1984

I think it's probably right.

PN1985

VICE PRESIDENT HATCHER: But you said a third - - -?‑‑‑So a third have given the same answer. I highlighted two because it seemed a particularly small number and it came up three times. But a third - 60 of that 171 provided the same response to both first and second and, as I have highlighted, there isn't a logical reason why those could be the same. If people misinterpreted one or both of the questions, that might be the case. But, again, if they're misinterpreting questions, we don't know what they're misinterpreting the question as being simply because now we're trying to guess what the respondent means and it's a dark channel to go down when you're ending up in that area.

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1986

MR FERGUSON: No further questions. Thank you, Mr Tegg.

PN1987

VICE PRESIDENT HATCHER: Any re-examination, Mr Nguyen?

PN1988

MR NGUYEN: Nothing further.

PN1989

VICE PRESIDENT HATCHER: All right, thank you for your evidence, Mr Tegg. You're excused. You're now free to go. Can we just retrieve that copy of the statement, please? Thank you.

<THE WITNESS WITHDREW [11.26 AM]

PN1990

MR FERGUSON: Can I raise an administrative issue?

PN1991

VICE PRESIDENT HATCHER: Yes.

PN1992

MR FERGUSON: Trying to discuss the order of things for the next two days with the other parties so that it proceeds in an order way, I suppose in trying to work out whether we are going to be able to get through everything in the next two days, the question has come up as to whether the Bench or this Bench has any alternative available days in the event that we don't complete everything.

PN1993

VICE PRESIDENT HATCHER: Not in the near future.

PN1994

MR FERGUSON: No.

PN1995

VICE PRESIDENT HATCHER: There would be months before we could come back which would, I think, destroy the benefit of the exercise.

PN1996

MR FERGUSON: Yes.

PN1997

VICE PRESIDENT HATCHER: But we will proceed on the basis that we have extensive written submissions and they're not - the submissions aren't being put in full orally.

PN1998

MR FERGUSON: Yes, we just wanted to know how much we had to play with in the event that there was another day.

*** WARREN JOSEPH TEGG XXN MR FERGUSON

PN1999

VICE PRESIDENT HATCHER: There will be a few questions you can anticipate.

PN2000

MR FERGUSON: I had anticipated that. We will take that on board and I'm sure the other parties will too.

PN2001

VICE PRESIDENT HATCHER: All right. While you're here, Mr Ferguson, there was an issue about an additional statement by the Recruiting and Consulting Association.

PN2002

MR FERGUSON: Yes.

PN2003

VICE PRESIDENT HATCHER: I think there was an agreement reached about it, but no one is here to deal with it. Do you know anything about that?

PN2004

MR FERGUSON: I don't know anything about that, I confess. Was this a statement that came in at the very last - or very late?

PN2005

VICE PRESIDENT HATCHER: Yes, I thought there was - I thought at some stage - Mr Fleming is not there.

PN2006

MR NGUYEN: Your Honour, on this particular issue, I'm appearing also on behalf of the ACTU.

PN2007

VICE PRESIDENT HATCHER: All right.

PN2008

MR NGUYEN: If the RCSA were going to appear and seek to tender it today, the union's position is that we objected to the admission of that statement into the proceedings.

PN2009

VICE PRESIDENT HATCHER: I thought the position was that the ACTU was going to press an objection to the admission of a statement, but if the objection was not accepted, it did not seek to cross-examine the witness; is that right?

PN2010

MR NGUYEN: That's correct, your Honour.

PN2011

VICE PRESIDENT HATCHER: So do you know if the RCSA is going to turn up to deal with that issue?

PN2012

MR NGUYEN: I don't know, your Honour. I understood that it was going to be today, but we haven't seen them.

PN2013

VICE PRESIDENT HATCHER: All right. We can only deal with that issue if they show up, but I'm not proposing to deal with it unless they show up and seek to tender the statements. Mr Ferguson and Mr Nguyen and Ms Bhatt, you seek to leave now?

PN2014

MR FERGUSON: Yes.

PN2015

MR NGUYEN: Yes, your Honour.

PN2016

VICE PRESIDENT HATCHER: You're excused and we now turn to the remaining witnesses concerning the Wine Industry Award which we weren't able to reach in the July hearing. So can I obtain the appearances in relation to that award firstly in Adelaide?

PN2017

MR H WALLGREN: Yes, your Honour, appearing for the South Australian Wine Industry Association, Wallgren, initial H, and Hills, initial S.

PN2018

VICE PRESIDENT HATCHER: All right, thank you.

PN2019

MR S BLEWETT: If the Commission pleases, Blewett, initial S, for United Voice.

PN2020

VICE PRESIDENT HATCHER: Mr Russell, you are also appearing for United Voice in Canberra; is that correct?

PN2021

MR RUSSELL: Yes, that's right.

PN2022

VICE PRESIDENT HATCHER: So, Mr Wallgren, who is the first witness?

PN2023

MR WALLGREN: The first witness is Mr Jeremy Dineen appearing by telephone from Tasmania.

PN2024

VICE PRESIDENT HATCHER: I didn't quite hear that. Which one?

PN2025

MR WALLGREN: Mr Jeremy Dineen via telephone from Tasmania.

PN2026

VICE PRESIDENT HATCHER: We will obtain him by telephone now.

PN2027

MR WALLGREN: Your Honour, Wallgren, for the South Australian Wine Industry Association, before calling Mr Dineen, we would like to seek the leave of the Commission to amend Mr Dineen's statement and that goes to paragraph 12 of his statement.

PN2028

VICE PRESIDENT HATCHER: We will have to wait until Mr Dineen is on the telephone for that.

PN2029

MR WALLGREN: As you please; sure.

PN2030

VICE PRESIDENT HATCHER: Mr Wallgren, we don't seem to have the telephone number at hand, so we might briefly adjourn. I will get you to supply the number. We will make the contact and when Mr Dineen is on the phone, we will then resume the hearing. So we will adjourn to allow that to occur.

SHORT ADJOURNMENT [11.30 AM]

RESUMED [11.35 AM]

PN2031

VICE PRESIDENT HATCHER: Mr Dineen, it's Vice President Hatcher and the Fair Work Commission, are you there on the phone?

PN2032

MR DINEEN: I am, yes.

PN2033

VICE PRESIDENT HATCHER: Do you have a copy of your witness statement with you?

PN2034

MR DINEEN: Yes, I do.

PN2035

VICE PRESIDENT HATCHER: The court officer is going to administer the affirmation to you and then you can take some questions from those appearing in the Commission.

PN2036

MR DINEEN: Sure.

PN2037

VICE PRESIDENT HATCHER: Please tell us if you can't hear anybody properly.

PN2038

MR DINEEN: I shall do.

<JEREMY CHARLES DINEEN, AFFIRMED [11.36 AM]

EXAMINATION-IN-CHIEF BY MR WALLGREN [11.36 AM]

PN2039

VICE PRESIDENT HATCHER: All right, Mr Wallgren.

PN2040

MR WALLGREN: Thank you, your Honour.

PN2041

Mr Dineen, it is Mr Wallgren from the South Australian Wine Industry Association?‑‑‑Hello.

PN2042

Have you prepared a statement in relation to these proceedings dated 7 October 2015?‑‑‑That is correct.

PN2043

You have a copy of that statement?‑‑‑I do.

PN2044

In the statement, there are 15 paragraphs; is that correct?‑‑‑Correct.

PN2045

I understand, Mr Dineen, that you would be seeking to amend your statement in relation to paragraph 12; is that correct?‑‑‑Correct. I understand that paragraph 12 is not actually relevant to the minimum engagement.

PN2046

So you seek its removal. Are there any other changes you would like to do to the statement?‑‑‑None.

PN2047

To the best of your knowledge, the content is true and accurate?‑‑‑Yes.

PN2048

Thank you, Mr Dineen. Thank you, your Honour.

PN2049

VICE PRESIDENT HATCHER: So do you wish us to strike out paragraph 12, do you?‑‑‑Correct.

PN2050

Yes, all right.

*** JEREMY CHARLES DINEEN XN MR WALLGREN

PN2051

MR WALLGREN: So I seek to tender the amended statement from Mr Dineen.

PN2052

VICE PRESIDENT HATCHER: Yes. The statement of Jeremy Dineen dated 7 October 2015, excluding paragraph 12, will be marked exhibit 298.

EXHIBIT #298 STATEMENT OF JEREMY DINEEN, EXCLUDING PARAGRAPH 12, DATED 07/10/2015

PN2053

Mr Blewett from the United Voice Union will be asking you some questions now. Mr Blewett.

PN2054

MR BLEWETT: Thank you, your Honour.

CROSS-EXAMINATION BY MR BLEWETT [11.37 AM]

PN2055

MR BLEWETT: Mr Dineen, I take it you can hear me clearly?‑‑‑I can, yes.

PN2056

Can I begin by just asking you some questions about Josef Chromy Wines? In paragraph 5 and paragraph 6, you talk about the composition of the employees in the business. There are 21 full-time employees and I take it that's employed across the different parts of the business?‑‑‑Correct.

PN2057

Do you have any part-time employees?‑‑‑No, we don't. We've either got full time or casual.

PN2058

Then 80 casuals whom you get in for peak times of harvest and pruning and I take it harvest really is in the first half of the year and pruning in sort of winter/spring; is that right?‑‑‑Correct.

PN2059

They may or may not be the same casual employees who were employed in those two different periods?‑‑‑Yes, there's a small amount of overlap, but generally they're different employees.

PN2060

Then you have six casual employees in the winery during harvest?‑‑‑Yes.

PN2061

Again, that's sort of the first half of the year, I take it?‑‑‑Yes, for us, that's sort of March, April and into May.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2062

Then three to four casuals bottling and warehousing most of the year?‑‑‑Yes, so that's a bit more sporadic depending upon the nature of the product and when it's actually packaged.

PN2063

So where you say most of the year, they may be engaged right across the year as opposed to being engaged for most of the year?‑‑‑Correct, that's probably poorly worded on my part. So throughout the harvest period, we tend not to do any packaging. So for a couple of months there where we're actually receiving fruit and making wine, and then during the rest of the year, we might package two days a week for a few weeks and then continually for two months and then nothing for another three weeks there. It's very much dependent upon the production cycle of the actual wine making and occasionally dependent upon product demand as well.

PN2064

Again is there any overlap between those casuals who work in the winery during harvest and those casuals who work in bottling and warehousing over the course of the year?‑‑‑A very small amount, but generally the people who are coming in for harvest are specialised labour who are there to perform wine making or laboratory tasks and certainly a different talent pool to the bottling and packaging.

PN2065

I think your answer probably has answered this question, but is there much crossover between the different tasks that employees perform, that is, the casuals involved in production in the winery, do they get involved in bottling and warehousing or cellar door work or vineyard work? Is there much crossover of that nature?‑‑‑We try and do as much of that crossover as possible to try and retain some high quality employees. But, for instance, some of the staff in the restaurant might not be quite so either suited or inclined to want to go out and prune vines in the middle of winter. So we try and get a bit of crossover. There's certainly - I mean, even yesterday and today we've had cellar door and restaurant staff in the warehouse, but it's not always possible to cross the sort of multi-disciplines of an integrated business like this.

PN2066

I take it there are benefits for the business in having that crossover in terms of the development of the skills of the employees?‑‑‑Yes, and certainly for some employees who have had that sort of cross-disciplinary experience throughout the business have gone on to then become permanent full time employees.

PN2067

I was going to say, and there are also obviously benefits for the employees themselves in (a) greater employment opportunities and (b) greater sort of skill development?‑‑‑Correct.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2068

Do you provide training in the different areas of your business to these different types of employees?‑‑‑It depends upon the nature of the employee. So, for instance, if we have got casual employees coming in for harvest, it's not - the training doesn't take an immense amount of time. It's important that they are trained to harvest the grapes in the way we want and to pick the correct grapes. Whereas, for instance, somebody in the packaging department would have quite a bit more on the job training because they're certainly going to be here for a longer period and upskilling them is of far more - has a far greater impact than a harvest which might only be for four weeks.

PN2069

Similarly, I guess, for those who are working in the production side of the winery?‑‑‑Yes.

PN2070

In paragraph 3 of your statement, you identify that the winery was established in 2004?‑‑‑Yes.

PN2071

I notice the publication surrounding the winery indicates that it was launched in December 2007. Do I take it from that, that it was sort of established from scratch in 2004 and then became, I guess, public in December 2007?‑‑‑Roughly. So the vineyard itself was established in 98 and 1999. Josef Chromy himself or the company purchased it in 2004 or late 2003 and we started making some wines in 2004, but didn't actually launch any product until the end of 2006, so essentially early 2007. So we've been carrying on viticultural activities here since late 2003. But the reason that Josef - I have stated that Josef Chromy wines was established in 2004 because previously it was trading as a different company. So we established the company, Josef Chromy Wines, in 2004.

PN2072

Were all the vines planted in 1998 or have they been planted progressively since 1998?‑‑‑The majority were planted - about one-sixth were planted in 1998 and then the remaining five-sixths in 1999. Since then, we have removed - done some removal and replanting or some grafting, but the vineyard, in its entire 61 hectares, has been in existence since 1999.

PN2073

I take it there is a period of time where vines need to mature before they produce fruit which can be turned into wine that you'd be prepared to sell?‑‑‑Well, you won't get a crop for the first two to three years and then you can certainly make wine from those first crops. It just depends. It may not go into your most premium brand. So depending upon the brand aspirations of any given vineyard or winery, it may or may not be suitable. But given that our first harvests from here were 2004 where some of the vines were already seven years old, we didn't have any problems putting the grapes directly into branded wines.

PN2074

In paragraph 9, you talk about prior to 2010, you harvested more than 60 per cent of your fruit by hand, whereas you now harvest less than 35 per cent by hand. You see that?‑‑‑Yes.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2075

What I want to suggest is that part of the reason for the increase in machine harvesting is the maturing of the vines?‑‑‑No, given that essentially the entire vineyard was established by 1999, that's not correct.

PN2076

In the period really over the last 10 years, with the effects of climate change, has the period of vintage compressed?‑‑‑That's difficult to stage for sure. The vintages have become more variable, both earlier and later, but as we have grown, we also process from vineyards off site, so our harvest period has actually extended.

PN2077

What you call the harvest period, is that the period from March to May that you described earlier in your evidence?‑‑‑Essentially, yes.

PN2078

So it's about a three-month period?‑‑‑Correct.

PN2079

In relation to your own vineyard as opposed to where you have harvested from other vineyards, has that period of vintage compressed over the last 10 years or so?‑‑‑In certain years, but not in every year. So one of the difficulties with cool climate viticulture, such as anywhere as far south as Tasmania, the vintage variability is far greater than most other regions in Australia. So our harvest start date could vary by anything up to three weeks.

PN2080

Has that created, I suppose, a greater urgency about being able to pick each grape variety at a particular time?‑‑‑No more so than any other vintage. I mean, the decision about when to pick your groups and how to pick them is based upon the target product and the, I guess, prevailing weather conditions and, you know, in certain instances whether there's disease pressure or anything like that. But there are many factors that go into making up the actual picking decisions including winery capacity as well.

PN2081

Those various factors you mention will influence the method of picking wine, whether that is by machine or by hand?‑‑‑Yes, I mean, there are certain - for instance, there are certain companies that will assert that hand-picked grapes are superior to machine-picked grapes and will only take hand-picked grapes or will only take hand-picked grapes for certain wines. But that varies significantly from company to company and from wine to wine.

PN2082

VICE PRESIDENT HATCHER: Sorry, Mr Blewett.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2083

Is there any logistical reason why, for example, your operation couldn't harvest all the grapes mechanically?‑‑‑We specialise in making sparkling wines and particularly using red grapes for sparkling wine you want to minimise any juicing or damage to minimise the pick-up of colour and phenolics which are the things that give you bitterness in sparkling wine or with any wine. So we generally will harvest the vast majority of sparkling by hand and we would prefer to harvest more table wine, Pinot, by hand as well.

PN2084

Thank you. Mr Blewett.

PN2085

MR BLEWETT: Thank you, your Honour.

PN2086

So I think part of the reason for picking by hand relates to the quality of the wine that's then produced?‑‑‑Correct.

PN2087

That's particularly the case in your case for sparkling wine?‑‑‑Yes.

PN2088

On the other hand, machine harvesting, I take it, is much more economic?‑‑‑Correct, and it can be performed overnight as well when it's nearly impossible to get, you know, 50 people out there trying to pick by torch light.

PN2089

Is one of the reasons for picking by night that it's better for the grapes not to be exposed to substantial heat after they have been picked?‑‑‑That's less relevant in Tasmania than it is in other parts of the country, particularly where we are where, I think, on average Launceston receives somewhere between one and three days per year above 30 degrees Celsius. So we have far less temperature risk in grape harvest than other parts of the country might.

PN2090

Is another reason for picking at night that it's important to pick the grapes at precisely the right time and sometimes that might be night and sometimes that might be day?‑‑‑Again, in a cool climates, things are perhaps slightly different. I mean, our ripening is somewhat slower than warmer regions, hence the picking window might be two or three days or even a week. It's certainly not a matter of hours.

PN2091

You might help me out then and perhaps explain what the reasons might be that you would pick at night rather than during the day?‑‑‑So for harvesting at night in most warmer climates, they would do that for exactly the reasons you have just outlined because people don't want to be picking grapes in 40 or 43 degree heat because you get greater enzymatic activity which causes browning of the juice. As I said here, that's not so much of a problem. So for harvesting at night, it's not as imperative for us. So we will often machine harvest during the day rather than during the evening.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2092

As I understand it, the wine industry really since about the global financial crisis that wine prices have been a little depressed, is that an accurate sort of broad-sweeping statement?‑‑‑That's a broad-sweeping statement but perhaps it doesn't apply to every region. If you were to single out some of the premium regions in Australia, such as the Barossa Valley, McLaren Vale, Margaret River, Tasmania, and I'm sure there are others, maybe Mornington Peninsula, some of those regions will have not experienced any price depression and some will have been insulated somewhat from it. Certainly Tasmania has not suffered the same price pressures as some of the inland irrigated regions of Australia.

PN2093

I accept that you won't have experienced those to the same degree, but it would be fair to say you have experienced price pressures over the last 10 years that perhaps hadn't been anticipated when Josef Chromy was established in 2004?‑‑‑No, we essentially established this vineyard in what was a downturn and potentially over supply. So, no, I don't think we've experienced price pressures that we weren't anticipating.

PN2094

In any event, the state of the market, has that also been an influence in this increase in machine harvesting as compared with hand picking that you talk about in paragraph 9?‑‑‑In what way?

PN2095

Has the price that you are able to get for your wine, has that had an influence in increasing the use of machine harvesting as opposed to hand picking?‑‑‑So we haven't - we haven't reduced any wine prices at any stage over the past 10 years. So if you look at the fruit price, so the farm gate fruit price for Tasmanian wine grapes, the price has been steadily increasing and I would say, on the whole, prices for branded Tasmanian wine have been increasing as well.

PN2096

I suppose put another way, though, the economic cost of machine harvesting as opposed to the economic cost of hand picking had an influence in the change that you describe in paragraph 9 from 60 per cent hand picking down to 35 per cent hand picking?‑‑‑It plays some influence, but if by changing hand picking to machine picking, you downgrade the fruit quality or reduce the price you can receive for that fruit then the economic influence is counter-intuitive.

PN2097

Is also another influence the sort of make-up of the range of your wines? What I mean by that is I presume you have sort of a range that you regard as your premium wines, a range that you regard as your sort of mid-level wines and a range that you describe as your sort of entry level wines, I guess. Is that an accurate summary of the different types of wine, the different classes of wine that you produce?‑‑‑Well, all these things are relative. So what you might describe as our - to use your words - entry level wine, like, our pricing starts at $25 per bottle which for many regions would be a premium bottle of wine.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2098

Yes, but does the composition of that range of wines have an influence on the extent to which you machine harvest?‑‑‑It can do to an extent, but all of those wines, our preference would be to have - in the winery - would be to have more hand-picked grapes.

PN2099

I suppose what I'm driving at is your statement appears to attribute the change from 60 per cent hand picking to 35 per cent hand picking, to the change of the minimum engagement from three hours to four hours?‑‑‑Well, actually the minimum engagement was two hours for us previously because before the National Wine Industry Award came in, we were under the State Horticulture Award.

PN2100

I am just addressing myself to paragraph 7 of your statement where - - -?‑‑‑Sorry, yes, for three hours. Sorry, we have the - because of the nature of our business, we have multiple awards and remembering the exact details of each one is - - -

PN2101

Sure. I suppose I will ask my question again. Your statement appears to attribute the rationale for the reduction from 60 to 35 per cent hand picking to this change from three hours minimum engagement to four hours' minimum engagement?‑‑‑Yes, yes.

PN2102

Is that an accurate understanding of what you're trying to say in your statement?‑‑‑That is a part of the reason. It would not be 100 per cent of the reason that we have changed.

PN2103

What I want to put to you is that that's not the substantial part of the reason?‑‑‑I would say it is a substantial part of any decision we make for harvesting or pruning.

PN2104

VICE PRESIDENT HATCHER: So what are the other reasons?‑‑‑The other reasons are simply actually the efficiency of being able to get the grapes picked on time. Sometimes it's also difficult to get enough hand pickers here in Tasmania. At that period, we're also competing with other stone and pome fruits, berries. So to get enough casual labour for literally only a short period of time can be quite difficult.

PN2105

I was going to ask you a question about that. So you said that you do have some difficulty in attracting the necessary number of casual workers at the right time?‑‑‑Certainly during harvest.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2106

Where do you source your pickers from during harvest time?‑‑‑A combination of local residents, some backpackers, refugees. We have, sort of, quite a broad mix of casual employees for both harvest and for pruning.

PN2107

Thank you?‑‑‑You're welcome.

PN2108

Mr Blewett.

PN2109

MR BLEWETT: Thank you, your Honour.

PN2110

Can I just move to a slightly different topic, Mr Dineen, and that is the concern that you express in your statement really at paragraphs 8 and 10 regarding lost time due to weather events?‑‑‑Yes.

PN2111

In paragraph 11, you estimate that there are five to 10 days where there would be 20 to 30 casual staff sent home earlier due to inclement weather and another three to seven days where 40 to 60 pickers are sent home for the same reason. Now, just pausing there, the reference to the 20 to 30 casual staff sent home earlier, is that in relation to the pruning period of the year?‑‑‑Correct.

PN2112

And the 40 to 60 pickers is in respect of the picking or harvesting part of the year?‑‑‑Correct.

PN2113

When you say sent home earlier, does that mean sent earlier than the shift time would have otherwise been or sent home earlier than the four-hour minimum?‑‑‑In some cases, both.

PN2114

In some cases, both, but in some cases merely earlier than the shift would have been?‑‑‑Potentially, yes.

PN2115

VICE PRESIDENT HATCHER: So how many cases have you actually had to send them home before they had done the four hours work to earn the four hours pay?‑‑‑Recently none because we don't bring them in. So, for instance, last Monday, I think it was, we had rain forecast for late morning and late morning would potentially have arrived before the four-hour minimum engagement, so we didn't call any pickers in. As it turned out, it didn't rain until 1 pm, so we could quite easily have had pickers in for five or five and a half hours. But previously we have had many occasions where the rain comes earlier than expected or completely unexpectedly and have sent people home after two and certainly three hours.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2116

Thank you.

PN2117

DEPUTY PRESIDENT BULL: Mr Dineen, are you aware of the stand down provisions under the Fair Work Act?‑‑‑I have recently made aware of those stand down provisions.

PN2118

Are they applicable in your circumstances or not?‑‑‑Well, that's the reason that I have struck out paragraph 12 of that declaration. It's certainly applicable to machinery breakdowns, but when poor weather is forecast but you can't determine the exact timing of it within a day, I would be hesitant to say that that's applicable.

PN2119

Thank you.

PN2120

MR BLEWETT: Thank you, your Honour.

PN2121

I take it, just following on from his Honour's question, you've never sought to use section 524 of the Fair Work Act in respect of those occasions where you have been forced to send employees home due to inclement weather?‑‑‑No, we have never done that.

PN2122

From your recent, sort of, I guess, knowledge of the provision, you'd agree that it would certainly apply in circumstances where rain had not been forecast?‑‑‑I suspect so.

PN2123

May or may not apply, but may be likely to apply where rain is forecast but not until late afternoon?‑‑‑I would be hesitant to make a definitive statement on that.

PN2124

You'd be even more hesitant if rain was forecast for late morning or, I suppose, a small amount of rain was forecast, you'd be hesitant to rely on section 524 in those circumstances?‑‑‑Yes.

PN2125

But I take it you were made aware of section 524 after making this statement?‑‑‑Correct.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2126

At least to some extent the availability or what you now understand to be the availability of section 524 would alleviate some of your concerns about these weather events impacting on your business?‑‑‑I have not seen any definitive statement to say that a weather event happening slightly earlier or later than forecast would apply to section 524, so I would be very hesitant to make a comment on that.

PN2127

I mean, if there were to be a provision which directly addressed the circumstances that should happen if inclement weather were to interfere with picking, that would alleviate, I suppose depending on the terms, that would alleviate your concerns about the interaction between the four-hour minimum engagement and inclement weather?‑‑‑Potentially.

PN2128

Can I just ask about inclement weather? I take it a certain level of light rain won't preclude the harvesting breaks?‑‑‑We would prefer not to have any rain on our grapes and light rain here - all of our vineyards are on slopes, so even light rain can make the hillsides quite dangerous, quite slippery and greasy with the soil types we have here. So we're very hesitant to have staff and machinery in any potential dangerous positions.

PN2129

So there are sort of occupational health and safety reasons for not picking in rain of any type?‑‑‑Correct.

PN2130

And similarly, I'd presume, not pruning in any type of rain?‑‑‑Pruning is, if it was very light rain, maybe not the same issue of people around machinery, but at this time of year when we're pruning or trying to finish our pruning, the hillside is still slippery and very, very muddy and unpleasant and difficult to work in.

PN2131

Just teasing that out, so it's the absence of the presence of machinery which means you can tolerate more sort of rain and more slipperiness pruning as compared with harvesting?‑‑‑Well, there's less of a danger of the machinery/human interaction in terms of any either machinery slippage or one of the staff slipping in front of machinery there. But it's still even with a millimetre of rain at the moment the ground becomes quite muddy, quite difficult, and of course in the climate we're in, it's also quite cold and miserable and you can't really, when you're doing intricate jobs like cane pruning and wrapping and tying the cane down, you can't wear gloves to keep your fingers warm. So I suspect that many of the pruners would say they would far rather not work in any rain at all.

PN2132

Presumably, even in pruning, there comes a point where you simply can't work effectively in rain?‑‑‑Correct, and that's only a few millimetres here.

PN2133

Coming back to harvesting, I take it there's also an additional reason for not harvesting in rain and that is that too much water, presumably, dilutes the fruit?‑‑‑It does, definitely.

*** JEREMY CHARLES DINEEN XXN MR BLEWETT

PN2134

Your estimates that you have provided in paragraph 11, you're aware you have been asked to provide any documents that relate to those periods where you have sent people home earlier and you've been unable to provide any documents?‑‑‑When we send people home, I don't make a specific note. We don't email, you know, 30 or 40 staff to say, "You've got to go home now." We make the call on the day and, you know, verbally advise them.

PN2135

So that's your estimate now from the experience you have had over recent years. Is that how we're to understand those estimates of the days?‑‑‑Correct.

PN2136

Yes, thank you. I've got nothing further.

PN2137

VICE PRESIDENT HATCHER: Is there any re-examination, Mr Wallgren?

PN2138

MS S HILLS: If the Bench pleases, it's Hills, initial S here, yes, I'd like to re-examine the witness, please.

PN2139

VICE PRESIDENT HATCHER: All right.

RE-EXAMINATION BY MS HILLS [12.15 PM]

PN2140

MS HILLS: Jeremy, in relation to just on that point about section 524 of the Fair Work Act which recently you have become aware, when cancelling or picking or pruning done during rain, the reason that you would - what would be the reason for cancelling the picking?‑‑‑There could be several reasons. The first would be, if it's picking, would be the actual physical danger of equipment slipping up and down the slope. If we have potentially 60 people on what's quite a substantial slope here and a tractor that might weigh, you know, three and a half tonnes pulling a further one and a half tonnes of grape bins behind it, if there's any slippage or loss of traction that can potentially do quite a bit of physical damage to an employee, so we try and avoid any possibility of that at all.

PN2141

So in other words, you might cancel because it's not impossible to do the work but because of safety reasons?‑‑‑Yes.

*** JEREMY CHARLES DINEEN RXN MS HILLS

PN2142

Also I'm taking from your comments earlier, it would also affect the quality, the rain, the rain can actually affect the quality of the grapes you're picking rather than the rain making the work impossible; would that be correct?‑‑‑Definitely. I mean, if you've got that amount of rainwater sitting in the bottom of each harvest bin, that will increase the weight and certainly no customer is going to want to pay for water when they're expecting to get high quality wine grapes. Plus there can be a potential significant dilution effect if the rain is heavy enough.

PN2143

The other question I just wanted to clarify from the cross-examination is in paragraph 9 about the reduction of hand picking post 2010. I guess, would there be greater hand picking by your business if you had more flexibility engaging casual labour?‑‑‑I think there would be, yes. Certainly we would prefer to pick more grapes by hand, particularly for sparkling wine. But even in those sort of early days of harvest, we're still getting significant amounts of rain days and, for us, the importance of picking time is - I mean, I stated earlier that we have got, perhaps, a wider window than other regions, but if the winery is fully booked for a week or two weeks and that time of harvest changes, the advantage of having even a portion of a pick into the winery before the rain comes, can be significant.

PN2144

Earlier you said like last Monday there was an event where rain was forecast. It wasn't late morning. It did in fact come at one o'clock. And you talked about the fact that you would have been able to engage casuals perhaps for five or five and a half hours in that circumstances. When you engage a casual, it would be fair to say that most casuals would be engaged for longer than the minimum engagement, but the minimum engagement allows you the flexibility to deal with events relating to the quality of the wine?‑‑‑Certainly.

PN2145

Thank you. That's all that I have.

PN2146

VICE PRESIDENT HATCHER: All right. Thank you for your evidence, Mr Dineen. You're now excused and free to go which means you can simply hang up the phone?‑‑‑Thank you, your Honour.

<THE WITNESS WITHDREW [12.20 PM]

PN2147

VICE PRESIDENT HATCHER: All right, Mr Wallgren or Ms Hills, the next witness is Mr van Ruth; is that right?

PN2148

MR WALLGREN: Yes, that's correct.

PN2149

VICE PRESIDENT HATCHER: All right. Yes, proceed, please.

<RICHARD THOMAS VAN RUTH, AFFIRMED [12.21 PM]

EXAMINATION-IN-CHIEF BY MR WALLGREN [12.21 PM]

PN2150

VICE PRESIDENT HATCHER: Please be seated, Mr van Ruth?‑‑‑Thank you.

*** RICHARD THOMAS VAN RUTH XN MR WALLGREN

PN2151

MR WALLGREN: Good morning, Mr van Ruth. Henrik Wallgren, SA Wine Industry Association. You have prepared a statement in relation to these proceedings; is that correct?‑‑‑Yes.

PN2152

You have got a copy of your statement?‑‑‑I do.

PN2153

The statement is dated 12 October 2015?‑‑‑Yes.

PN2154

The statement comprises 13 paragraphs; that's correct?‑‑‑Yes.

PN2155

Is there anything that you would like to change in your statement since filing it, any corrections?‑‑‑Yes, there is one small detail relating to paragraph 5. We recent reviewed our group bookings policy at Primo Estate and we no longer accepted groups larger than 16. So currently it states that we range from eight to 40 people for group bookings. That's now been reduced to eight to 16.

PN2156

Apart from that change, no further changes to the statement?‑‑‑No.

PN2157

To the best of your knowledge, the statement is true and accurate?‑‑‑It is.

PN2158

I would like to tender that, your Honour.

PN2159

VICE PRESIDENT HATCHER: The statement of Richard van Ruth, dated 12 October 2015, will be marked exhibit 299.

EXHIBIT #299 STATEMENT OF RICHARD VAN RUTH DATED 12/10/2015

PN2160

VICE PRESIDENT HATCHER: Mr Blewett.

PN2161

MR BLEWETT: Thank you, your Honour.

CROSS-EXAMINATION BY MR BLEWETT [12.22 PM]

PN2162

MR BLEWETT: Mr van Ruth, as I understand your statement, your concern or your main concern with the minimum engagement under the award is as it relates to your cellar door activities?‑‑‑Yes, that's true.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2163

Can I just ask about cellar door staff? Now, as I understand it, you have six casual cellar door staff; is that right?‑‑‑Yes.

PN2164

Are they the only people employed in the cellar door or do you have permanents who are employed in the cellar door as well?‑‑‑We also have a full time cellar door manager. I can confirm too that one of those casual staff is just being converted to be a full time member of staff as well, so it will go down to five casuals and two full time staff.

PN2165

That person who has just been converted will remain in the cellar door?‑‑‑Their role is split between cellar door and cellar door administration.

PN2166

Can I ask, is it difficult to find good cellar door staff?‑‑‑Yes, it is.

PN2167

By good, I suppose, I mean they would need to bring a number of attributes to the job, wouldn't they?‑‑‑Yes.

PN2168

One of those is obviously it would be helpful if they are engaging characters?‑‑‑Yes.

PN2169

Able to have decent conversations with people?‑‑‑Yes.

PN2170

Knowledgeable about wine?‑‑‑To an extent, yes.

PN2171

And knowledgeable about Primo Estate Wine as opposed to other wine?‑‑‑I wouldn't class that as a prerequisite to employing someone, but certainly once we have employed them, we will give that knowledge and impart that on them.

PN2172

I mean, you train them in the range of wines that you produce?‑‑‑Yes, of course.

PN2173

To some extent the circumstances in which each different wine is produced from where it's grown to how it's harvested and those sorts of things?‑‑‑Yes.

PN2174

And the treatment during wine production?‑‑‑Yes.

PN2175

It would be important to be able to relate that knowledge both to members of the public who are apparently quite knowledgeable about wine and members of the public who apparently know little about wine?‑‑‑Yes.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2176

That is, to be able to have different types of conversation according to their appraisal of the person coming in?‑‑‑Yes, yes, that's true.

PN2177

Important that the people are left with a sense of a pleasant experience of the winery?‑‑‑Paramount.

PN2178

And that they be left with that pleasant experience notwithstanding that there is also a sales element to the job of the person providing the tasting experience?‑‑‑Yes.

PN2179

Do your cellar door people have sales targets that they're expected to meet?‑‑‑No, they don't.

PN2180

Does the cellar door itself have sales targets that it is expected to meet?‑‑‑Yes.

PN2181

I take it from all of that, if you find a good cellar door person, you're quite keen to hang on to them as much as you can?‑‑‑Yes.

PN2182

Do you involve them in sort of cross-training between different aspects of the winery's functions?‑‑‑No.

PN2183

For instance, there is I think associated with your tasting is the provision of food; is that right?‑‑‑Yes, on a very small, limited level there is, yes.

PN2184

Do the cellar door staff have any involvement in any of the food preparation or the food provision?‑‑‑Yes, they do.

PN2185

I suppose, I take it in addition to the sort of customer relation role which I think I have tried to identify, they are obviously involved in the packaging of wine upon sale?‑‑‑Yes, they will pack a customer's order and often take it out to their car for them. To the extent of where a customer wants an order delivered back to their house wherever they happen to live in the country, we largely outsource that to a 3PL provider.

PN2186

But they would be involved in processing the order for shipping in those circumstances?‑‑‑The casual staff probably not. They'll process the order via, you know, an iPad in the cellar door terminal. That order will then go through. They'll select whether it's shipping or take-away and someone else will typically send that order off later.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2187

As I understand it, you keep records regarding visitations so that staff would be involved in inputting those records of visitations?‑‑‑Yes.

PN2188

And presumably also relating to sales?‑‑‑The sales is all - the sales data is all collected by the CRM.

PN2189

What about - I don't know how to describe it - the sort of marketing follow-up? I mean, there are a number of wineries that seem to use the cellar door experience to then follow up with people who have had that experience to make them aware of wine offers and other sorts of things. There's that sort of - not the doing of the marketing follow-up, but the data entry which would enable that marketing follow-up, is that a role of the cellar door staff?‑‑‑Yes. So cellar door staff, you know, when we collect consumer data, so names, addresses, emails, et cetera, cellar door staff do sometimes input that data into our CRM. Often if it's a busy day, you know, they will be sort of left for someone else to do at a latter date.

PN2190

So that's a job that can be sort of basic information might be sitting in the cellar door, but the data entry can be left to another time?‑‑‑Yes.

PN2191

Then I imagine there's all sorts of, you know, preparation and maintenance of the tasting area, in particular, glass cleaning?‑‑‑Yes.

PN2192

And the removal of food and all those sorts of things?‑‑‑Yes.

PN2193

And with glass cleaning, I take it it's important not only that the glasses be spotless, but that they be, for want of a better word, smell-less?‑‑‑Yes.

PN2194

And cool, I presume, as opposed to straight out of the dishwasher or whatever?‑‑‑All correct.

PN2195

And I suppose what I wanted to suggest was that putting all of those tasks together, I think in paragraph 6 of your statement you talk about a 'Josef tasting' only taking staff time of about one and a quarter to one and three quarter hours all up. And, therefore, you're reluctant to engage someone for a wine tasting where they might be required to be at work for four hours under the award. You recall that part of your statement?‑‑‑Yes, I do.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2196

What I want to suggest is that given all of those tasks that are involved in cellar door tasting, isn't it likely that on most occasions there will be sufficient work to keep a staff member, even if they are called in for one 'Josef tasting' to be productively employed for the full four hours of a minimum engagement?‑‑‑No, I'd disagree with that and I think paragraph 6 refers specifically to group bookings. So if we separate out, you know, walk-in traffic, you know, groups of maybe a couple, four, six, eight, who wander into the cellar door without a booking and would like to - decide to do the 'Josef Experience Tasting', our normal core cellar door staff will be able to facilitate that throughout their sort of shift of work. We do regularly get enquiries for larger group bookings which you can see that from our website on our private events pack. We have just reviewed that to scale it back because we found it very hard to accommodate the larger group bookings, you know, with the minimum engagement of four hours because, in reality, looking at a large group booking in insolation, we can set them up in a separate space to the normal cellar door set-up for the tasting, execute the tasting, pull it down, clean all the glasses, put it all away, that certainly doesn't take four hours to do.

PN2197

So paragraph 6 is relating to a discrete pre-booked 'Josef Wine Tasting'. Is that what we should understand paragraph 6 to be referring to?‑‑‑Yes.

PN2198

Can I just dwell on how that works? As I understand it, if a group of eight or more wish to taste Primo Estate Wines then it has to be done via what's called the 'Josef Wine Tasting'?‑‑‑Yes, that's correct.

PN2199

That will apply whether someone is pre-booking or where a group of eight turn up?‑‑‑Yes, although if the group of eight rocks up, they might find that we can't accommodate them because we don't have space.

PN2200

For that, there is a charge of $15?‑‑‑Yes.

PN2201

And that $15 is waived on the purchase of wine?‑‑‑Correct.

PN2202

Is it your experience that generally a group tasting of that nature will lead to the purchase of wine?‑‑‑We do collect data through our cellar door metrics on the percentage of people who do the 'Josef Experience' within the cellar door and the percentage of those people that make a purchase. Harder to do for larger group bookings but, anecdotally, the smaller groups will generally purchase more person than the larger groups. So we find a lower conversion rate just due to those group dynamics.

PN2203

And by larger groups, are you talking about larger than 16 or are you talking - - -?‑‑‑Larger than eight.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2204

But is it the case that it is more likely - you're metrics show that more sales are made per person from a 'Josef Wine Tasting' than they are of simply walk-ins?‑‑‑No, I don't think I'm saying that.

PN2205

It's the opposite, is it?‑‑‑What I'm saying is, the smaller groups will generally purchase more. Like, more individuals from a smaller group will purchase than those from a larger group.

PN2206

I'm sorry, I think we're at cross-purposes?‑‑‑Yes.

PN2207

By smaller and larger groups, are you talking about smaller and larger groups within the 'Josef Wine Tasting' range, or are you saying a group of four is more likely to buy more wine than a 'Josef Wine Tasting' group of eight?‑‑‑I was talking specifically about the 'Josef Wine Tastings'. So everyone is doing the 'Josef Experience'. A group of four would typically purchase more than a group of eight, yes.

PN2208

Regardless of the size of the group, is it more likely that a 'Josef Wine Tasting Experience' will lead to more sales per person than what I might call the ordinary wine tasting experience?‑‑‑Yes.

PN2209

For groups of 16 or more, as I understand it, there has been an experience described as the 'VIP Josef Experience'. Is that something that's still offered or is that the thing that's no longer offered?‑‑‑No, we're no longer offering the VIP experience.

PN2210

That was an experience generally in a different part of the centre from the tasting room?‑‑‑Yes.

PN2211

Regardless of the size of the group between eight and 16, is it just one employee who is involved in a 'Josef Wine Tasting Experience'?‑‑‑We have typically rostered on for weekends which are the busiest times between two and four staff to accommodate for, you know, the smaller numbers of pre-booked Josef Experience plus walk-ins.

PN2212

I am just trying to understand how this works. If you have a pre-booked Josef Experience for between eight and 16 people, do you then allocate one staff member for that experience or do you simply allocate sufficient staff in the cellar door that that experience, plus anticipated walk-ins, can be accommodate?‑‑‑Yes, yes, that's true.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2213

The latter?‑‑‑The latter.

PN2214

Can I then turn to your rostering and as I understand it you provided a document which is - or a bundle of documents which is the cellar door roster for periods between March 2014 and to date. Do you recall that?‑‑‑I do.

PN2215

If the Commission pleases, I wonder if I might hand the witness a document.

PN2216

VICE PRESIDENT HATCHER: Yes, you may.

PN2217

MR BLEWETT: The document that I have just handed you comprising about I think seven or eight pages, is that the roster that you have provided?‑‑‑Yes.

PN2218

That is the Prime Estate Cellar Door roster from, I think, 29 March 2014 for periods between that date and 25 August 2016?‑‑‑Yes.

PN2219

Just pausing there. It was provided in late May 2016. Can I take from that that really for the period from June 2016 onwards, it's really the base roster which in ordinary course of business would be supplemented depending on (a) what bookings you might have at a particular point in time and (b) what your trends were showing for visitation; is that right?‑‑‑Loosely, yes.

PN2220

That is, perhaps put another way, it is more likely to be an accurate reflection of who was actually there in the period leading up to the end of May 2016 than the period post June 2016?‑‑‑Yes.

PN2221

If the Commission pleases, I tender that. I hope that that document has been made available to the Commission, albeit late.

PN2222

VICE PRESIDENT HATCHER: Yes, we have that. So the roster for Primo Estate will be marked exhibit 300.

EXHIBIT #300 ROSTER FOR PRIMO ESTATE

PN2223

MR BLEWETT: Mr van Ruth, can I just ask you to turn to page 3 of that bundle?‑‑‑Sure.

PN2224

Which really begins 4 January 2016?‑‑‑Yes.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2225

Firstly just to identify what we are looking at, there is a column with obviously the date, the first column?‑‑‑Yes.

PN2226

The second column obviously the day of the week?‑‑‑Yes.

PN2227

Then each of the subsequent columns, do they correspond to a particular employee?‑‑‑Correct.

PN2228

And the first of those employees, given that they have a period of annual leave and RDOs, I take it that's the cellar door manager?‑‑‑Correct.

PN2229

Then are the subsequent columns all casual employees or correspond to individual casual employees?‑‑‑Yes, with a couple of exceptions. So there is a column there which is extras. So that'll often be, you know, January which we're looking at here is the busiest month of the year in McLaren Vale for cellar door, so there'll be a high demand for staff and a large amount of people around. So that extra column is often people like myself who will dedicate my time to the cellar door to help get through that really busy period.

PN2230

VICE PRESIDENT HATCHER: Which column is that, the extras column?‑‑‑That is going to be - if we go - one, two, three, four, five, six, seven - the sixth column in there.

PN2231

Thank you.

PN2232

MR BLEWETT: I beg your pardon, just to clarify that, is that the sixth column with numbers in it or the six altogether?‑‑‑Good point. So if we take our cellar door manager as the first and the sixth.

PN2233

So it's the sixth one, thank you. And just while we're on that page, particularly in the final column but also in I think the third to last column, and in a variety of subsequent columns, there's some what appears to be white-out; do you see that?‑‑‑Yes, yes, I can.

PN2234

Is that simply whiting out to remove identification? Is that what that's about?‑‑‑Yes, yes.

PN2235

It's not about removal of hours or anything like that?‑‑‑No, not at all, no, just getting people's names off it.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2236

Consistent with what you have just described in your evidence, what appears is that in January generally you will have three to four employees on weekdays?‑‑‑Yes.

PN2237

And generally four to five employees on weekends?‑‑‑Yes.

PN2238

And there seems to be a bit of a drop-off in early February and then it picks up to, sort of, three to four during the week and three to four to even five on weekends in what I might describe as Adelaide's sort of festival period from halfway through February to halfway through March; is that accurate?‑‑‑Yes.

PN2239

Then it really settles down to generally two to three during the week, more commonly two rather than three during the week and two to three on weekends in what might be described as the sort of autumn period, early autumn, and then settles down, it seems, to one to two during the week in winter and generally two on weekend days. Is that reasonable accurate?‑‑‑Yes, I'd say, you know, one to two during the week and then weekend during the quieter months, during the cooler months, we generally have a little bit more on a Saturday. Saturdays statistically are busier than Sundays. And the one person less on a Sunday.

PN2240

The cellar door, I think, is open from 11 until four; is that right?‑‑‑Yes.

PN2241

Does it change in summer and winter or it's always 11 until four?‑‑‑No, they're our stated opening hours. In reality, you know, the gates are unlocked 10-ish and rarely shut before five.

PN2242

You kick someone out when they're halfway through a tasting?‑‑‑Sometimes we wish we could, but, no, we don't.

PN2243

It seems to me generally the pattern of shifts is that you appear to try to give most of your employees relatively full days. Nine to five for the cellar door manager and generally 10 to five for the other casual employees?‑‑‑That's what we roster. I suppose if we were to cross-reference that with some of the timesheets, you might see that on a fairly regular basis we will cut people's shifts a bit short depending on how the day is going.

PN2244

But based on the sort of visitation data and your experience, you tend to roster, as I say, ten to five shifts for most of your casual employees in the cellar door?‑‑‑Yes.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2245

And I think there is a lesser reliance, but albeit a reliance on an 11 to five shift. That's relatively common, though less common than 10 until five?‑‑‑That's right. You will get someone in at 10 to help to get the place up and running and open and then at 11 when the published opening hours start, you know, that's when people generally arrive.

PN2246

Then it's only very occasionally - in fact, I think I could only find two occasions in 2016 where someone is engaged for the minimum shift length that is allowable, that is the four-hour shift, and I think - - -?‑‑‑Well, yes, like I said, it would be perhaps more relevant to take a look at the actual timesheets to see this is what we roster people on for. But, as I said before, regularly we may let people leave early if the day is proving to be quieter than we expected.

PN2247

From your data are you able to predict when is the most likely time of peak visitation?‑‑‑Unfortunately not.

PN2248

I presume when you know you have got bookings for Josef Wine tasting experiences, you will know then that that's likely to put some pressure on your numbers?‑‑‑Of course.

PN2249

Putting that to one side, I suppose you know that there are periods of the year where you will have more visitors than others, but quite when they turn up on a day is still a difficult exercise?‑‑‑Correct.

PN2250

Is it more likely to be the afternoon than the morning?‑‑‑It's a very difficult thing to predict. We have the cellar door open there at McLaren Vale for 10 years, so we have seen, you know, patterns emerge and that's. sort of. as you referred to, times of the year, specific weeks, school holidays, weekends where we have events on and some of the dates in there where we have a lot of staff on over a Saturday/Sunday will correlate with, you know, one of our lunches that we put on on a regular basis. But as to the pattern of walk-in customers, you know, there's no reliable data on which to base our rostering.

PN2251

So I take it it follows from that that identifying a particular two-hour period where you could engage a casual if the minimum engagement were lowered, would be a difficult exercise?‑‑‑Only from the sense of walk-in customers. But, as you have alluded to just previously, when we have booked Josef Experience tastings and we can see there is a cluster of them coming in a particular window or we might have a group of 16 which is to do with the entire Josef seating area for us, we know when those people are going to arrive, we know how long they're going to stay. We know that's less than four hours. So in those circumstances, it would be useful for us to be able to employ someone just for two hours to come in, execute that group, and then leave us to get on with the rest of the day.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2252

So that's the circumstance really that we're talking about?‑‑‑Yes.

PN2253

Just returning to those Josef Wine tastings, I think at paragraph 6 you say you decline - sorry, I withdraw that. Just finishing off that last point, so it's not the case where you could perhaps by using more employees on a particular day for shorter periods of time be able to overlap those shifts to meet the likely peak visitation period. That's just something that's not possible given the data that you have; is that right?‑‑‑Yes.

PN2254

Is that essentially why you rely on essentially full day shifts when you engage a casual?‑‑‑Like I say, the rostered time is not often the total time that the staff members will work. But, yes, I think - - -

PN2255

I apologise. I misspoke. That's the rationale for rostering them - - -?‑‑‑Correct, yes, that's correct.

PN2256

In relation to the Josef Tastings, you say in paragraph 6 that you often decline large group bookings. So you regularly decline large group bookings where you can't arrange them consecutively?‑‑‑Yes, that's right.

PN2257

How far in advance do people tend to make bookings for Josef Wine Tasting?‑‑‑On average, and it varies tremendously, of course, but typically within seven days.

PN2258

I take it sometimes people want to organise themselves in advance of that. You might have a booking three or four weeks down the track?‑‑‑Absolutely, particularly, you know, corporate groups who might have - they might be coming to Adelaide for a conference in the convention centre or somewhere else and as a side trip to their conference they might want to take a group of their employees or customers down to McLaren Vale, do a little day out. So we'll get a lot of notice for those.

PN2259

Just focussing on those then, how does it work with something that far in advance that you would decline the group booking because you couldn't possibly know at that point whether or not you would be able to arrange a consecutive tasting?‑‑‑That's right, so we typically decline those enquiries.

PN2260

So you decline an enquiry made, say, two months in advance of a particular day because you can't be certain that you will be able to arrange a consecutive, is that your evidence?‑‑‑Yes.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2261

So how can you ever get a consecutive booking if on each occasion you get a booking you decline it because you haven't got a consecutive booking?‑‑‑Good point. I don't have an answer to that. We can't.

PN2262

But I think that's my point which is if you decline each booking because you haven't got a consecutive booking, that would mean that you had to decline every group booking?‑‑‑Well, your reference here was to a corporate group who might be booking six/eight weeks out as opposed to the majority of group booking enquiries which are, like I said before, within seven days.

PN2263

Sure, but taking that through, your six to eight-week corporate booking, you have declined because you can't get a consecutive booking?‑‑‑Yes.

PN2264

Presumably your two to four-week booking, you have to decline because you can't get a consecutive booking. Come to seven days, someone rings up saying, "I want to book a wine tasting experience", you have at that point, because you have declined all the others, no group booking, isn't your logic that you have to decline that one as well?‑‑‑It is.

PN2265

Then the one that comes in two days later, you have to decline that one as well?‑‑‑Yes.

PN2266

I suppose put it around the other way, I should ask how do you ever get a group booking if you decline each booking because there's no consecutive booking?‑‑‑We take a conservative approach to this in terms of our cellar door wages. So, like I said, if we're not confident we can cover, you know, the cost of these group bookings and make some sort of a return from it, we take the view that we would rather not book them in for running the risk that we will lose money on them.

PN2267

I suppose that wasn't really my question. My question was, if your evidence is right that you decline each group booking on the basis that you have no consecutive booking, how do you ever entertain a group booking?‑‑‑Looking at the large group bookings like we're referring to now, it's rare that we do that. For example, I would have personally stepped out and taken one of these group tastings if it falls during the week because I can be there and do that. However, is that a productive use of my time for a couple of hours as opposed to being able to employ one of our casuals who lives locally to pop in for two hours, run that tasting, and then go home.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2268

These bookings can be made either, I presume, in person or over the phone or online?‑‑‑Yes, online being via email. There's no facility on our website to book a group wine tasting.

PN2269

You agree that there's nothing in your online material which suggests that the capacity to accept a group booking in the nature of eight to 16 people is contingent upon your ability to run consecutive tastings?‑‑‑No.

PN2270

So in respect of an online booking, the first that a person will know that they can't actually come on that day was when they have made a booking and you provide a response?‑‑‑I'd say when they made an enquiry, not a booking.

PN2271

When they use the online process to make an enquiry for a booking, that's when they find out?‑‑‑Yes, if they email us to say, "We would like to come and do a wine tasting on a given day", we have so many people this time, we will look at that and respond to them accordingly.

PN2272

When you respond to them, do you advise them that you can't undertake the group booking that they have requested because you can't arrange consecutive tastings?‑‑‑No.

PN2273

So you simply indicate that you can't entertain them at the time they want?‑‑‑Yes.

PN2274

Mr van Ruth, I must say I should put to you that I don't accept that the evidence you have given regarding the regular refusal of these group bookings can be accurate. What do you say to that?‑‑‑I don't understand what you're asking me to say.

PN2275

I suppose one of the things, I don't understand why you would set up an online enquiry system which provides a range of information about what you offer, but no suggestion that a booking may be refused because of the inability to arrange consecutive bookings, that you have set up a system like that if what you say is true about the regular refusal of those types of bookings that you invite through your website?‑‑‑I'm still not sure what you're asking me to say 'yes' or 'no' to.

PN2276

You would disagree with my assertion that your evidence about how regularly you refuse these group bookings is inaccurate. You would disagree with that assertion?‑‑‑Yes, I do.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2277

Just in relation to these refusals, you're aware that you were asked to provide documents relating to the refusal of these group bookings?‑‑‑Yes.

PN2278

And you are unable to produce any documents relating to the refusal of group bookings?‑‑‑Yes.

PN2279

And I take it not all of these group bookings are directed to your attention?‑‑‑Yes.

PN2280

Yes, they're not?‑‑‑No, they are not, no, they will come to the cellar door manager as a first port of call.

PN2281

So your evidence about the regularity of this is in part informed by your own knowledge?‑‑‑Yes.

PN2282

And in part informed by presumably discussions you have had with the cellar door manager?‑‑‑Exactly, we sit very close by.

PN2283

VICE PRESIDENT HATCHER: Mr Blewett, it's almost one o'clock here. We need to wrap up this witness fairly soon.

PN2284

MR BLEWETT: Thank you, your Honour. I can indicate I have no further questions.

PN2285

VICE PRESIDENT HATCHER: Just a couple of questions, Mr van Ruth. Does Primo Estate make olive oil as well as wine?‑‑‑Yes, we do.

PN2286

Do you have tastings of that?‑‑‑Yes, so the Josef Experience Tasting comprises a selection of the Josef Wines alongside which we serve our current season Josef Extra Virgin Olive Oil with a little bit of bread and Italian cheese.

PN2287

That sounds nice. That sounds nice at lunchtime, particularly?‑‑‑Yes, indeed.

PN2288

In terms of your casual cellar door staff, where you source them and what sort of profile of person is it?‑‑‑So we source them in terms of where they live. We don't sort of put a caveat that they must live within a certain radius of the property, so some of our staff do live locally and two or three live in the Adelaide metropolitan area and drive back and forth to work. When we're recruiting and looking for staff, typically we have a fairly strong reputation for our cellar door in McLaren Vale. So we're currently, I believe, number two on TripAdvisor. So we don't have to cast the net too far. We typically have people enquiring on a reasonably regular basis for employment with us, so we keep their details on file and should a vacancy arise, we will look through those to pick someone.

*** RICHARD THOMAS VAN RUTH XXN MR BLEWETT

PN2289

So what sort of person are we talking about; retired people, second job people, young people?‑‑‑Looking at our current cellar door casual employees, there's a bit of a cross-section. There's three university students. There's a local working mum who works in three different cellar doors in the area. There's a young woman who is just aspiring to get her career in the wine industry under way. And there's another young lady who lives in the area who enjoys working in wine on a casual basis.

PN2290

The ones that have to drive up from metropolitan Adelaide, how far is the drive?‑‑‑It takes about 40 minutes each way.

PN2291

Each way, thank you. Mr Wallgren and Ms Hills, is there any re-examination?

PN2292

MR WALLGREN: Just one question, Mr van Ruth.

RE-EXAMINATION BY MR WALLGREN [1.02 PM]

PN2293

MR WALLGREN: So in relation to the casual minimum engagement and your Josef sessions, is it correct in that you would be able to accept a greater number of Josef sessions if the casual minimum engagement was less?

PN2294

MR BLEWETT: Your Honour, I object purely only on the basis - - -

PN2295

VICE PRESIDENT HATCHER: I will allow the question. I will allow the question.

PN2296

THE WITNESS: I do agree with that, yes.

PN2297

MR WALLGREN: Nothing further, your Honour.

PN2298

VICE PRESIDENT HATCHER: All right, thank you for your evidence, Mr van Ruth. You're excused and now free to go.

<THE WITNESS WITHDREW [1.02 PM]

*** RICHARD THOMAS VAN RUTH RXN MR WALLGREN

PN2299

VICE PRESIDENT HATCHER: Mr Blewett and Mr Wallgren, we need to organise whether and how we do closing submissions. There is three options. The parties can rely upon their submissions put on today. They can put on extra written submissions and, additionally, if you want, you can ask for the opportunity to put on oral submissions. Have you had any consideration of that?

PN2300

MR BLEWETT: We had, your Honour. What we had agreed between ourselves, but we hadn't discussed it with the parties who aren't present in Adelaide, was that the Wine Industry Association would have until 9 September to provide any further written submission that it sought to do and that the responding parties would then have until 30 September to provide written submissions. I think we had indicated a preference that there be some opportunity for limited oral submissions but we are in your Honour's hands about that aspect of it. But between ourselves, we agree on 9 September and 30 September as the dates for provision of written submissions.

PN2301

VICE PRESIDENT HATCHER: If the parties want the opportunity to put on oral submissions, then we could give you some time on either 27 October or 29 November.

PN2302

MR BLEWETT: 27 October would be suitable, sir.

PN2303

VICE PRESIDENT HATCHER: Mr Wallgren?

PN2304

MR WALLGREN: Yes, I am content with that.

PN2305

VICE PRESIDENT HATCHER: Can I ask the parties to send me a note of the proposed directions and the proposed preference for oral submissions and we will peruse those and issue formal directions to that effect.

PN2306

MR BLEWETT: Thank you, your Honour.

PN2307

VICE PRESIDENT HATCHER: One other thing, Mr Blewett, I think in one question to Mr Dineen, you expressed the possibility of a provision which could cover where work ceases because of unanticipated inclement weather; is that right?

PN2308

MR BLEWETT: Yes, I did.

PN2309

VICE PRESIDENT HATCHER: Is that a subject that you could usefully have discussions with Mr Wallgren about?

PN2310

MR BLEWETT: I am certainly happy to, sir, yes.

PN2311

VICE PRESIDENT HATCHER: I will leave that in the parties' hands, but it seems to me there might be some room for progress in that area. If there is nothing further, we will now adjourn and resume at 2 pm.

LUNCHEON ADJOURNMENT [1.05 PM]

RESUMED [2.09 PM]

PN2312

VICE PRESIDENT HATCHER: Mr Warren.

PN2313

MR WARREN: Yes, your Honour. We have three witnesses today and two other affidavits to tender of deponents we understand are not required for cross-examination. I might do those first, if I may. It's the affidavits of Alan Raymond Robinson. Does your Honour have that? Would it suit the Commission if I dealt with it later on?

PN2314

VICE PRESIDENT HATCHER: Just hold on a sec. We just have to locate where it is.

PN2315

MR WARREN: That's no problem. I can do it after the witnesses if it would suit your Honour.

PN2316

VICE PRESIDENT HATCHER: Yes, all right. So what was the first one?

PN2317

MR WARREN: Thank you, your Honour. It's the affidavit of Alan Raymond Robinson.

PN2318

VICE PRESIDENT HATCHER: Yes.

PN2319

MR WARREN: It's an affidavit of some ten paragraphs which was declared on 9 October 2015.

PN2320

VICE PRESIDENT HATCHER: So Mr Russell-Uren, can you confirm that he is not required for cross-examination?

PN2321

MR RUSSELL-UREN: No, not required for cross.

PN2322

VICE PRESIDENT HATCHER: Thank you. The statement of Alan Raymond Robinson dated 9 October 2015 will be marked exhibit 301.

EXHIBIT #301 STATEMENT OF ALAN RAYMOND ROBINSON DATED 09/10/2015

PN2323

MR WARREN: Thank you, your Honour, and there is another Robinson; Gerard Robinson.

PN2324

VICE PRESIDENT HATCHER: That's tab 21.

PN2325

MR WARREN: Does your Honour have that one?

PN2326

VICE PRESIDENT HATCHER: Yes, we do.

PN2327

MR WARREN: Thank you. It is an affidavit of Gerard Robinson of some 15 paragraphs with one annexure declared on 7 October 2015.

PN2328

VICE PRESIDENT HATCHER: The affidavit of Gerard Robinson sworn on 7 October 2015 will be marked exhibit 302.

EXHIBIT #302 AFFIDAVIT OF GERARD ROBINSON SWORN 07/10/2015

PN2329

MR WARREN: Thank you, your Honour. And the first witness this afternoon is Carol Jarvis. She is in the witness box now.

PN2330

VICE PRESIDENT HATCHER: All right.

<CAROL ANNE JARVIS, SWORN [2.13 PM]

EXAMINATION-IN-CHIEF BY MR WARREN [2.13 PM]

PN2331

VICE PRESIDENT HATCHER: Mr Warren.

PN2332

MR WARREN: Yes, thank you, your Honour.

PN2333

Ms Jarvis, you have sworn two affidavits for the purpose of these proceedings?‑‑‑Yes.

PN2334

Do you have them with you in the witness box?‑‑‑Yes, I do.

*** CAROL ANNE JARVIS XN MR WARREN

PN2335

Is the first one an affidavit of some 12 paragraphs with an annexure A that you declared on 12 November 2014?‑‑‑Yes, I did.

PN2336

The second affidavit which in essence is affirming the first affidavit plus adding some additional material is an affidavit that you declared on 1 October 2015?‑‑‑Yes, that's correct.

PN2337

VICE PRESIDENT HATCHER: I'm sorry, Mr Warren, the earlier affidavit - - -

PN2338

MR WARREN: Sorry, did I say 2015? It's 12 November 2014.

PN2339

VICE PRESIDENT HATCHER: Yes. So the earlier affidavit is annexure A to the affidavit - - -

PN2340

MR WARREN: Second affidavit.

PN2341

VICE PRESIDENT HATCHER: Just slow down. There is an affidavit of 1 October 2015.

PN2342

MR WARREN: Yes, yes, your Honour.

PN2343

VICE PRESIDENT HATCHER: And that annexes an affidavit of 12 November 2014.

PN2344

MR WARREN: Yes, which itself has one annexure.

PN2345

VICE PRESIDENT HATCHER: Yes. There is only one affidavit before us.

PN2346

MR WARREN: Yes, yes, your Honour. Sorry, yes.

PN2347

VICE PRESIDENT HATCHER: That's all right.

PN2348

MR WARREN: Ms Jarvis, are there any amendments you wish to make to that material?‑‑‑Number 7.

*** CAROL ANNE JARVIS XN MR WARREN

PN2349

This is in your annexed affidavit to your second affidavit; yes?‑‑‑Yes, that one.

PN2350

Paragraph number 7; yes?‑‑‑Paragraph number 7, with my son being part of a choir, he is in a new more elite choir. I have more responsibilities with getting him to and from rehearsals and performances. The only other amendment is my mother-in-law has passed away.

PN2351

I see, fine. Thank you. Thank you, Ms Jarvis. That's the evidence of Ms Jarvis. Can I tender that, please?

PN2352

VICE PRESIDENT HATCHER: Yes. The affidavit of Carol Anne Jarvis sworn on 1 October 2015 will be marked exhibit 303.

EXHIBIT #303 AFFIDAVIT OF CAROL ANNE JARVIS SWORN ON 01/10/2015

PN2353

MR WARREN: If the Commission pleases.

PN2354

VICE PRESIDENT HATCHER: Mr Russell-Uren.

PN2355

MR RUSSELL-UREN: Yes.

CROSS-EXAMINATION BY MR RUSSELL-UREN [2.15 PM]

PN2356

MR RUSSELL-UREN: Are you able to hear me, Ms Jarvis?‑‑‑Yes, yes.

PN2357

I can't see the witness, but - - -

PN2358

VICE PRESIDENT HATCHER: All right, we will try to organise that, Mr Russell-Uren.

PN2359

MR RUSSELL-UREN: Ms Jarvis, in your statement you say that you get 25 hours each fortnight; is that correct?‑‑‑No, 25 hours a week minimum.

PN2360

I'm sorry, my apologies, 25 hours per week, and that's always been the case throughout the time that you have been part time, is it?‑‑‑That would be the minimum that I'd work over a week.

*** CAROL ANNE JARVIS XXN MR RUSSELL-UREN

PN2361

You have a fairly good relationship with your employer?‑‑‑Yes, yes, it's a good relationship.

PN2362

Glad to hear it. And would you ever expect the employer to sort of drop below that 25-hour guarantee?‑‑‑No.

PN2363

When you were employed, I just want to understand where this 25-hour guarantee came from, was that sort of discussed at the point of employment?‑‑‑When I started, I started as a casual catering attendant at the club.

PN2364

Perhaps if I could give some precision to my question. You say initially that you started as a casual in the club in 2001 and about six years ago you moved to being a part-timer. At the time that you became a part-timer was that 25 hours agreed between you and your employer?‑‑‑No, there was no formal written agreement of hours. I was employed on a permanent part-time basis and there are provisions that, you know, permanent part time work, a minimum of so many hours under the award and a maximum of so many hours. But for me, in particular, there was no set, "This is how many hours you have to work per week." That is what I have been working and what I was available to work was 25 hours per week. And then if I'm required to work more, I'm more than happy to work more hours.

PN2365

When are your regular shifts?‑‑‑Currently, I work Monday, Tuesday, Thursday, Friday.

PN2366

With Wednesday, Saturdays and Sundays off; is that right?‑‑‑Yes, yes, that's correct.

PN2367

And you do about 7.5 hours each day?‑‑‑Approximately. Some days it could be less, some days it could be more, it depends.

PN2368

Is there any reason that you have every Wednesday off?‑‑‑I choose not to work Wednesday.

PN2369

That's presumably time that you dedicate to your family and the community at large?‑‑‑Yes, I have other commitments on Wednesdays. In previous instances, I have worked - I have not worked on a Tuesday.

*** CAROL ANNE JARVIS XXN MR RUSSELL-UREN

PN2370

When you decided to change - well, when you wanted to change the day off from a Tuesday to a Wednesday, was there a reason for that?‑‑‑Yes, I no longer needed to have Tuesday free, therefore, when I looked at what my working week was like, I found that having Wednesday off was more conducive to the business because I could have two days working, have my Wednesday off, and then two days working.

PN2371

Sorry, can I ask this. You reference your family in your statement. You have got parental responsibilities?‑‑‑Yes, I do.

PN2372

How many kids do you have?‑‑‑Three.

PN2373

As part of the reason that you have the Wednesdays off to do with taking care of the kids as well?‑‑‑No, they go to school.

PN2374

You mention that your son is in an elite choir?‑‑‑Yes.

PN2375

Congratulations. But how does that impact upon your availability?‑‑‑For my son to attend this choir, he rehearses at Lewisham, at the public school. We live at Menai. He goes to school at Menai. So I need to drive him from Menai to Lewisham to be there on time. He doesn't drive and public transport is not available to get him to the rehearsals on time.

PN2376

VICE PRESIDENT HATCHER: What days of the week do you do that on?‑‑‑That's on a Tuesday afternoon.

PN2377

There is a certain time you have to do it, I assume?‑‑‑Yes, I have to leave at three to get him from school then be at Lewisham by 20 past four.

PN2378

You made a general answer earlier that you said you are available to do extra hours as required, but I assume that afternoon is a time that you're not available to do extra hours?‑‑‑That's correct.

PN2379

Yes, thank you.

PN2380

MR RUSSELL-UREN: Has the time for his choir practice ever changed?‑‑‑This year it's now at Lewisham. Previous years it was at Sutherland at a different choir at a different time.

*** CAROL ANNE JARVIS XXN MR RUSSELL-UREN

PN2381

How much notice did you get of the change of that arrangement?‑‑‑Well, we changed - he changed choirs completely. So he auditioned. He had the placement. And so I knew at the beginning of the year that he was successful and I spoke to my employer and that was the arrangement. But I had previously finished at three on a Tuesday prior to my son going to this other choir.

PN2382

May I ask, how much notice did you give to your employer of this proposed change in arrangements?‑‑‑A few months.

PN2383

I understand in your statement that you say that your family relies on your wages in part; is that correct?‑‑‑Yes, correct.

PN2384

And they rely on the 25 hours?‑‑‑I rely on the 25 hours. Yes, I - - -

PN2385

Sorry, if you would repeat that answer?‑‑‑I don't quite understand how - - -

PN2386

VICE PRESIDENT HATCHER: The witness said she relied on the 25 hours.

PN2387

MR RUSSELL-UREN: Yes, sorry?‑‑‑I don't quite understand your question.

PN2388

The audio is not great and my questioning manner is always a little off kilter, so I apologise. I will repeat the question.

PN2389

VICE PRESIDENT HATCHER: So, Mr Russell-Uren, are you hearing the witness clearly?

PN2390

MR RUSSELL-UREN: Not very, no.

PN2391

VICE PRESIDENT HATCHER: We will just see if we can do something about that. I'm not sure it's going to get any better, Mr Russell-Uren.

PN2392

MR RUSSELL-UREN: No, that's all good, as long as she can hear me and the Bench can hear her.

PN2393

So you have said that your family relies on your wages. Presumably you have a weekly or a monthly budget; is that correct?‑‑‑Yes, yes, we have a budget.

PN2394

Is that budget based on the estimate of you working the 25 hours per week?‑‑‑No. My husband is employed so his wage contributes to our budget. I work as well so my wage contributes to our budget, so combined.

*** CAROL ANNE JARVIS XXN MR RUSSELL-UREN

PN2395

But your budget is based in part on the 25 hours that you do regularly; isn't that the case?‑‑‑Yes.

PN2396

Is there any sort of occasional or - rather, let me ask it this way. Do you ever have cause to change your availability on a week basis, sort of, two weeks out if something comes up?‑‑‑If something comes up, I give my employer notice. If I have - if I'm aware of something that's coming up a few weeks ahead, I'll speak to my employer. If it's something that comes up at short notice, I'll also speak to my employer and then I have the opportunity to swap the days because I have that Wednesday free. I have - this week I wanted Friday off, so I chose to work this Wednesday and I'm not working this Friday. So I spoke to my employer maybe two or three weeks ago and that wasn't a problem.

PN2397

So essentially, just so that I understand you correctly, you say, in essence, "Look, I'm not available on this Friday", and they say, "Look, that's okay, you can make the hours up on another day." Is that the way the conversation would occur?‑‑‑I advise my employer that I'd like to have a particular day off. I can work on the Wednesday to make up the difference.

PN2398

Would that be documented anywhere?‑‑‑I usually send an email and he will send an email back. It's not a formal exchange. I may do it verbally.

PN2399

There is nothing further from me. Thank you for your time, Ms Jarvis?‑‑‑Pleasure.

PN2400

VICE PRESIDENT HATCHER: Ms Jarvis, can I take it that the nature of your duties is such that it's fairly easily transferrable from one day to another, that is, whether you perform a certain amount of work on a Wednesday or a Friday might not matter that much?‑‑‑Yes, that's right.

PN2401

Thank you. Any re-examination, Mr Warren?

PN2402

MR WARREN: Nothing arising, your Honour, thank you.

PN2403

VICE PRESIDENT HATCHER: Thank you for your evidence, Ms Jarvis, you're excused and you're free to go?‑‑‑Okay, thank you.

<THE WITNESS WITHDREW [2.27 PM]

PN2404

VICE PRESIDENT HATCHER: All right.

*** CAROL ANNE JARVIS XXN MR RUSSELL-UREN

PN2405

MR WARREN: Yes, your Honour. The next witness is Kristy Gardiner and I understand your associate has the phone number. It's a landline. It will probably go to a switchboard and we will then need to speak to Kristy Gardiner after that.

PN2406

VICE PRESIDENT HATCHER: Let's proceed with that.

<KRISTY GARDINER, AFFIRMED [2.29 PM]

EXAMINATION-IN-CHIEF BY MR WARREN [2.29 PM]

PN2407

VICE PRESIDENT HATCHER: Mr Warren.

PN2408

MR WARREN: Yes, thank you, your Honour.

PN2409

Ms Gardiner, it's Ralph Warren speaking. I'm representing Clubs Australia Industrial in this matter. I think you responded earlier that you have a copy of your witness statement with you?‑‑‑Yes, I do.

PN2410

Is it a statement of some six paragraphs that you signed on 12 October 2015?‑‑‑Yes, it is.

PN2411

Is it true and correct or do you wish to make any amendments to it?‑‑‑There's a couple of amendments that need to be made. According to paragraph 1, as I made this statement a number of years ago, I have now been employed for nine years, not the four years that it states there. And in paragraph 3, all of my children are school-age children and attend school.

PN2412

Thank you. With that amendment, is it your evidence that your statement is true and correct to the best of your knowledge?‑‑‑Yes.

PN2413

Yes, I tender that statement.

PN2414

VICE PRESIDENT HATCHER: So four years was change to nine years?

PN2415

MR WARREN: It was, yes.

PN2416

VICE PRESIDENT HATCHER: How does that line up with the date of October 2015?‑‑‑I initially made this statement back on 29 November 2012.

*** KRISTY GARDINER XN MR WARREN

PN2417

All right. The statement of Kristy Gardiner dated 12 October 2015 will be marked exhibit 304.

EXHIBIT #304 STATEMENT OF KIRSTY GARDINER DATED 12/10/2015

PN2418

MR WARREN: If the Commission please, that's the evidence of Ms Gardiner.

PN2419

THE WITNESS: Sorry? It's a very hard line. It's hard to hear you, sorry.

PN2420

MR WARREN: I'm sorry, Ms Gardiner. A representative from the union will now be asking you some questions. You won't be able to see him and hopefully you will be able to hear each other?‑‑‑Yes.

PN2421

VICE PRESIDENT HATCHER: Ms Gardiner, if you can't hear properly, can you please tell us immediately so we can turn the volume up, if that's possible?‑‑‑Yes.

PN2422

All right, Mr Russell-Uren.

CROSS-EXAMINATION BY MR RUSSELL-UREN [2.31 PM]

PN2423

MR RUSSELL-UREN: Ms Gardiner - - -?‑‑‑I can't hear you now.

PN2424

Let me just check. Ms Gardiner, my name is Stefan Russell. I'm from United Voice. Are you able to hear me?‑‑‑Only just.

PN2425

VICE PRESIDENT HATCHER: Mr Russell, Uren, can I just make a suggestion? I think to your right at the far edge of the table is that star-shaped sort of microphone thing. See if that might improve.

PN2426

MR RUSSELL-UREN: Yes.

PN2427

VICE PRESIDENT HATCHER: Just bring it down. I think the cable will be long enough. That might actually improve the quality.

PN2428

MR RUSSELL-UREN: Thank you, Deputy President.

*** KRISTY GARDINER XXN MR RUSSELL-UREN

PN2429

Ms Gardiner, can you hear me better now?‑‑‑I can hear you, yes.

PN2430

VICE PRESIDENT HATCHER: No.

PN2431

MR RUSSELL-UREN: May I just check, are you still employed as an administration supervisor?‑‑‑Yes, I am.

PN2432

What does that work entail?‑‑‑That is, I work directly underneath management and I supervise junior staff and trainees and I oversee the day to day operations of the administration here in the club.

PN2433

What are your regular shift times?‑‑‑Total or daily?

PN2434

I will withdraw that question. I will ask another. Do you have a regular set of shifts that you often work?‑‑‑Normally, yes.

PN2435

What does that shift pattern look like in a week?‑‑‑Twenty-nine hours per week.

PN2436

What days do those hours fall on?‑‑‑Monday, Wednesdays, Thursdays and Friday.

PN2437

How many hours would you do on each day?‑‑‑I do eight hours Monday, Tuesday, Wednesday, and I do a five-hour shift on a Friday. Sorry, did I say Tuesday? Monday, Wednesday, Thursday, I do eight hours, and I do five hours on Friday.

PN2438

And 29 hours is fairly precisely. How did your employer come to that figure, do you recall?‑‑‑I have no idea how they come to the rostering, no.

PN2439

Have you always worked 29 hours?‑‑‑On average each week, yes.

PN2440

For the duration of the nine years that you have worked there?‑‑‑I do and then I'm called in on extra shifts every now and again according to people being ill or annual leave or management having to attend seminars.

PN2441

On the times that you don't work, so I take that as being Saturday, Sunday, Tuesday, do you have family responsibilities or other commitments that you meet in that time?‑‑‑I have a family, yes.

*** KRISTY GARDINER XXN MR RUSSELL-UREN

PN2442

So on the weekend, do you have, for example, kids sporting engagements that you need to attend?‑‑‑I don't have sporting engagements, but having the four children and my husband's roster, I am unable to do that sort of stuff.

PN2443

I am sure they would keep your hands full?‑‑‑They do.

PN2444

Can I ask, what sort of work does your husband do?‑‑‑He's a police officer, so he doesn't work regular hours per week as such.

PN2445

Is that why you need some stability in your job so that you can plan around that?‑‑‑That's correct.

PN2446

Have you always had the Tuesday, Saturday and Sunday off?‑‑‑Generally, yes.

PN2447

I'm sorry. Is there any way you could repeat your answer?‑‑‑Generally, yes, I do.

PN2448

But there would be occasions where, for example, you are called in to do an additional shift and you wouldn't mind, I assume?‑‑‑That's correct, yes.

PN2449

But throughout the course of the nine years, you have had those three days off?‑‑‑Yes.

PN2450

At the time that you were first employed, did you say you needed those days off?‑‑‑No, coming from my previous employment, I was told that that would be the days and then with the additional - like I may have to start early on a day and leave - and like just, for example, if I start at nine and work until six, I might have to start at six and work until four or something like that depending on that. But I've always had the Tuesday, Saturday, Sunday off, because the administration position here at the club is really a Monday to Friday position, but then I'm also utilised throughout the club elsewhere, like in the bar or if there's a function if they can't get anybody else.

PN2451

SENIOR DEPUTY PRESIDENT HAMBERGER: Could I just ask, Ms Gardiner, you said you are sometimes called in to do some extra shifts. Can I just confirm that - - -?‑‑‑I'm sorry, I can't hear you properly.

PN2452

You said that sometimes you are called in to do some extra work?‑‑‑Yes.

*** KRISTY GARDINER XXN MR RUSSELL-UREN

PN2453

If it wasn't convenient for you, could you just say "No"?‑‑‑I could, but it does help financially.

PN2454

So you're happy to do it?‑‑‑I am happy to do it, yes.

PN2455

But have you any sense in which if you couldn't do it you could just say, "No, I'm not available"?‑‑‑That's right.

PN2456

Thanks.

PN2457

MR RUSSELL-UREN: And when you are called to do an extra shift, do those extra shifts usually fall on the days that you normally have off?‑‑‑Yes.

PN2458

Have you ever had cause to change your availability, for example, on a weekly or on an occasional basis?‑‑‑On an occasional basis, yes, I do, if the kids have something, for example, next week there is a book parade at school, I'm able to have that time off to go and see the kids do their parade and then come back to work or if they have appointments that I can't schedule on a Tuesday, Saturday or a Sunday, my youngest child sees a psychologist. If I can't get it on those days, I need to have the ability to go on my roster day. So I'll make up the hours elsewhere.

PN2459

So you don't take leave for that period. It's just a couple of hours you don't work; is that right?‑‑‑That's right. That's right.

PN2460

Then you said you make up the hours elsewhere?‑‑‑I make up the hours elsewhere, yes, either by staying back on the other days.

PN2461

Would you ever come in on a day that you would usually have off, like a Tuesday?‑‑‑To make up the hours?

PN2462

Yes?‑‑‑Probably not per se, but maybe if they've already rostered - like the management are going to a meeting, they might call me in to do the banking for three hours and I'll use those three hours as that time. Does that make sense?

PN2463

Yes, yes, of course?‑‑‑Sorry.

PN2464

And these occasional arrangements, are they documented anywhere?‑‑‑No.

*** KRISTY GARDINER XXN MR RUSSELL-UREN

PN2465

So there's not like an exchange of emails even?‑‑‑There's not an exchange of emails, no, no, because we all work here in the one office and they might just pop out and say, "I'm going to a meeting at 7 o'clock in the morning, can you start the banking at six?" And you will do that.

PN2466

How much notice would you give your employer of one of these occasional times off?‑‑‑For me organising for the time off?

PN2467

Yes?‑‑‑As much as I get from the school, so a couple of weeks or something like that. Sometimes it is just a matter of hours because, as I said, my youngest child, he sees a psychologist for behavioural issues. So quite often I do get a phone call and have to run to the school to deal with that situation. Then I come back and make up the hours.

PN2468

From my own recollection, that can happen on short notice. And just bear with me for a second?‑‑‑Yes, you're right.

PN2469

The 29 hours that you regularly work, do you base your household budget in part on that commitment?‑‑‑Yes, I do. So anything over and above that treats my family.

PN2470

You would expect your employer to honour that commitment, I take it?‑‑‑Yes.

PN2471

How would you react if your employer dropped down to, for example, 20 hours per week?‑‑‑I would probably then have to look for another job which wouldn't be ideal because I may not have the same circumstances that I do currently here.

PN2472

There is nothing further from United Voice.

PN2473

VICE PRESIDENT HATCHER: Thank you. Any re-examination, Mr Warren?

PN2474

MR WARREN: No, nothing arising, your Honour.

PN2475

VICE PRESIDENT HATCHER: Thank you for your evidence. You're excused. You are now free to go?‑‑‑Thank you.

<THE WITNESS WITHDREW [2.41 PM]

*** KRISTY GARDINER XXN MR RUSSELL-UREN

PN2476

VICE PRESIDENT HATCHER: Can we get Ms Devine on the same number?

PN2477

MR WARREN: No, it's a different number, your Honour. She's not at work. She's on her mobile.

PN2478

VICE PRESIDENT HATCHER: I see, all right.

PN2479

MR WARREN: Hopefully she's home.

PN2480

VICE PRESIDENT HATCHER: We will contact Ms Devine now. Mr Warren, what was the 2012 proceeding that statement was originally prepared for?

PN2481

MR WARREN: It was the two yearly review that you might recall and then the nature of the two year review changed.

<BRENDA DEVINE, AFFIRMED [2.43 PM]

EXAMINATION-IN-CHIEF BY MR WARREN [2.43 PM]

PN2482

VICE PRESIDENT HATCHER: All right, Mr Warren.

PN2483

MR WARREN: Yes, thank you.

PN2484

Ms Devine, it's Ralph Warren speaking. I'm representing Clubs Australia in this matter. You have your affidavit with you?‑‑‑I have.

PN2485

Is it an affidavit dated 12 October 2015 with one paragraph and attached to that is an earlier affidavit that you have sworn?‑‑‑Yes, the one I've got here is dated - I'm not sure whether it's 13 or 15 November 2014.

PN2486

That's the affidavit attached to your shorter affidavit?‑‑‑Okay.

PN2487

Is that right?‑‑‑Yes.

PN2488

That affidavit is dated 12 October 2015; that's right?‑‑‑Yes.

*** BRENDA DEVINE XN MR WARREN

PN2489

The one attached is an affidavit of some eight paragraphs; is that correct?‑‑‑That's right.

PN2490

Is there any changes you wish to make to any of the material you have there?‑‑‑No.

PN2491

Is it your evidence to this Commission that your affidavit is true and correct to the best of your knowledge?‑‑‑Yes.

PN2492

I tender that.

PN2493

VICE PRESIDENT HATCHER: The affidavit of Brenda Devine sworn on 12 October 2015 will be marked exhibit 305.

EXHIBIT #305 AFFIDAVIT OF BRENDA DEVINE SWORN 12/10/2015

PN2494

MR WARREN: That's the evidence. There will be some questions for you, Ms Devine?‑‑‑Okay.

PN2495

VICE PRESIDENT HATCHER: Mr Russell-Uren.

PN2496

MR RUSSELL-UREN: Yes.

CROSS-EXAMINATION BY MR RUSSELL-UREN [2.44 PM]

PN2497

MR RUSSELL-UREN: Ms Devine, are you able to hear me?‑‑‑Yes, I am.

PN2498

I just have a couple of questions about your statement. You say that you're a single mum. That's still the case?‑‑‑Yes.

PN2499

You used to be a part time employee and then you moved to being a casual employee?‑‑‑Yes, that's right.

PN2500

You have always received 25 hours of work per week; is that right?‑‑‑Yes, roughly, roughly around 25.

*** BRENDA DEVINE XXN MR RUSSELL-UREN

PN2501

So when you say roughly around 25, does that sort of give and take one or two hours?‑‑‑Yes, yes.

PN2502

Your family relies on that income?‑‑‑Yes.

PN2503

You also say that on around 7 September of 2014, the club CEO spoke about the potential for changes to the part time provisions of the award; do you remember that?‑‑‑Yes, I do.

PN2504

It was at about that time that you chose to convert to being casual?‑‑‑That's right.

PN2505

Did that follow from what you understood he had said?‑‑‑Yes.

PN2506

Can you recall what he said?‑‑‑Well, she actually. She just said that like if these changes come in, any extra shifts would not be available for us if we were permanent part time, that they would go to the casuals.

PN2507

VICE PRESIDENT HATCHER: Did she explain why that was the case?‑‑‑Yes, she explained that she'd have to be paying others overtime - paying me, sorry, overtime rates as opposed to the normal hourly rate and that it would be more affordable for her to use a casual as opposed to a permanent part time.

PN2508

Thank you.

PN2509

MR RUSSELL-UREN: Just to be clear, this conversation occurred in around September of 2014?‑‑‑That's right.

PN2510

When were you first employed as a permanent part time employee?‑‑‑2 July 2007.

PN2511

This conversation, that's essentially what prompted you to move to casual because you wanted to pick up those additional shifts; that's right?‑‑‑That's right, that's right.

PN2512

And essentially as a single mum you just couldn't risk the prospect of losing those additional shifts?‑‑‑That's right.

*** BRENDA DEVINE XXN MR RUSSELL-UREN

PN2513

If the part time provisions were amended so that you could, as you have put it, pick up those additional shifts, would you seek to convert back to being a part-timer?‑‑‑Yes, I would because it may just be more - yes, more - what's the word - more secure for me.

PN2514

That's because you would have a fair sense of the hours that you get next week and the week after that and the week after that, is that what you mean when you say more secure?‑‑‑Yes, and more stability in the job, I think I mean.

PN2515

At least at the moment what are the regular shifts that you work?‑‑‑I don't understand that question.

PN2516

That's entirely on me. I wasn't clear. Do you have a set of regular shifts that you work?‑‑‑Yes, we do. We're on a rotating four-week roster.

PN2517

So you do sort of four shifts one week, three shifts the next, is that - - -?‑‑‑No, I usually do five shifts per week.

PN2518

How long are the shift times?‑‑‑Some are four hours, some are five hours.

PN2519

Are there any days in every week that you're unavailable to work?‑‑‑No.

PN2520

So you're pretty much happy to work 24/7, Monday to Sunday; is that right?‑‑‑Yes.

PN2521

How long would the longest shift be that you would work?‑‑‑Six hours and that's with having a half-hour break after five hours and then going back and doing an extra hour.

PN2522

Has there ever been a time in the period that you have worked for the club where you have been unavailable on a given day?‑‑‑No, only at the times when I was permanent part time when I had holidays.

PN2523

May I ask this, in the time that you have been a casual, has the club continued to give you 25 hours?‑‑‑Yes, they have.

PN2524

And that's always been the case, they have always given you, give or take that 25 hours; right?‑‑‑Yes, yes.

*** BRENDA DEVINE XXN MR RUSSELL-UREN

PN2525

If they were to dramatically drop those hours, for example, they roster you down for 15 in the next week, how would you feel?‑‑‑Well, I feel it'd probably stress me out a little bit. I think I'd be disappointed. I don't know whether that's the right answer - yes.

PN2526

Pretty gutted?‑‑‑Yes.

PN2527

Was it the case that when you started work with the club, they said: "We can give you 25 hours a week"?‑‑‑Yes.

PN2528

VICE PRESIDENT HATCHER: Just to be clear about that, Ms Devine, when you were a part time employee, did the club promise you or guarantee you 25 hours or was that just the way it worked out?‑‑‑That was - yes, that's just the way it worked out. Yes, I can't remember really actually how many hours - whether they did say how many hours back then. It was like - because that was a few years ago so my memory is not really clear on that, whether they said how many hours.

PN2529

You received more or less 25 hours work as a part-timer. Since you've been a casual, you've received more or less 25 hours work. Why do you say that you'd feel more secure if you were a part-timer rather than a casual?‑‑‑Well, I don't know whether this is just my feeling that if you're a permanent part-timer, I don't know, I just feel that your job is more secure. You know, and if they are going to let you go, they've got to give you notice. Whereas a casual, it can be, sort of, you know, "Don't come back tomorrow", sort of thing, you know what I mean?

PN2530

Yes. All right, thank you?‑‑‑Yes.

PN2531

MR RUSSELL-UREN: When you were a part-timer, did you ever take annual leave?‑‑‑Yes, I did.

PN2532

Did you take it sort of on school holidays?‑‑‑No, not usually in school holidays. I just - sometimes it fell in school holidays. I just - yes. Well, I took a big annual leave when I took trip to England a few years ago, so I'd sort of saved up my holidays for that trip.

PN2533

There is nothing further from the union. Thanks for your time?‑‑‑Thank you.

PN2534

VICE PRESIDENT HATCHER: Any re-examination, Mr Warren?

*** BRENDA DEVINE XXN MR RUSSELL-UREN

PN2535

MR WARREN: Nothing arising, your Honour, thank you.

PN2536

VICE PRESIDENT HATCHER: All right, thank you for your evidence, Ms Devine, you're excused. You're now free to go, which means you can simply hang up the phone?‑‑‑Okay, thank you. Bye.

<THE WITNESS WITHDREW [2.54 PM]

PN2537

VICE PRESIDENT HATCHER: Is that all the witnesses, Mr Warren?

PN2538

MR WARREN: That's all I have, yes, your Honour. That's it.

PN2539

VICE PRESIDENT HATCHER: All right, thank you. So we can proceed to the next matter. So I notice there's some building industry types in the background. Perhaps you can come forward. If I could take the appearances. Mr Maxwell, you appear for the CFMEU?

PN2540

MR MAXWELL: That's correct, your Honour.

PN2541

VICE PRESIDENT HATCHER: Ms Adler, you appear for the Housing Industry Association?

PN2542

MS ADLER: Thank you, your Honour.

PN2543

VICE PRESIDENT HATCHER: And Ms Sostarko for the MBA?

PN2544

MS SOSTARKO: Thank you, your Honour.

PN2545

VICE PRESIDENT HATCHER: So where are we up to with this award? There is a statement of Annica Cloet. What's the position with that statement?

PN2546

MS ADLER: My understanding is she wasn't required for cross-examination.

PN2547

VICE PRESIDENT HATCHER: So that can simply be tendered, can it?

PN2548

MR MAXWELL: That's correct, your Honour.

*** BRENDA DEVINE XXN MR RUSSELL-UREN

PN2549

VICE PRESIDENT HATCHER: All right. We'll just see if we can find it.

PN2550

MS ADLER: It should be at attachment D to the HIA's submissions dated 12 October.

PN2551

VICE PRESIDENT HATCHER: So the statutory declaration of Annica Cloet dated 12 October 2015 will be marked exhibit 306.

EXHIBIT #306 STATEMENT OF ANNICA CLOET DATED 12/10/2015

PN2552

MS ADLER: Thank you, your Honour.

PN2553

VICE PRESIDENT HATCHER: All right.

PN2554

MS ADLER: So HIA seeks to vary the Building and Construction General On-site Award to insert section 19.3(c) which is attached to HIA submissions and marked attachment B. And what attachment B seeks to do is firstly provide clarity in the award as to how the casual rate of pay is calculated. And, secondly, provide clarity and certainty that the 25 per cent casual loading does not apply to various other allowances paid under the award. On this basis, there are two questions that I would ask the Bench to keep in mind when considering HIA's application.

PN2555

The first question is: can you on opening and reading the on-site award work out the rate of pay for, for example, a casual carpenter?

PN2556

The second question that we would ask is: why should an employee receive an additional 25 per cent loading on an allowance? For example, why should a casual employee receive an amount of $36.22 per week for the industry allowance when a full time employer will receive about $29 per week in compensation for the same disability?

PN2557

We would suggest that the answer to these two questions will demonstrate why the variation we propose is needed in the on-site award.

PN2558

VICE PRESIDENT HATCHER: Ms Adler, just so we don't get ahead of ourselves because we're dealing with a lot of witnesses and a lot of awards.

PN2559

MS ADLER: Of course.

PN2560

VICE PRESIDENT HATCHER: So can we just go back to the very basics. So what does the award currently provide for in these respects?

PN2561

MS ADLER: That's a loaded question, your Honour.

PN2562

VICE PRESIDENT HATCHER: I understand there is going to be an argument about it, but what is the basic concept?

PN2563

MS ADLER: We have rates of pay and calculations for rates of pay for daily hire employees under clause 19.1(a) and weekly hire employees under clause 19.1(b).

PN2564

VICE PRESIDENT HATCHER: Yes, yes.

PN2565

MS ADLER: That provision does not provide a calculation for a casual rate of pay. Under the award, we have clause 14 which talks about casual employment and specifies that 25 per cent casual loading is paid. It doesn't refer to any rate of pay in the award. It doesn't refer back to clause 19.

PN2566

VICE PRESIDENT HATCHER: So how do daily hire and weekly hire rates relate to each other, if at all?

PN2567

MS ADLER: I think daily hire was a throwback to historical ways of engagement under the award. My understanding is weekly hire was introduced during award modernisation. So no we've got different forms of employment that were not necessarily in pre reform awards. We have casual engagement as well which can be on a longer basis than was the case under pre-reform awards as well, and our view is that during award modernisation the casual rate of pay wasn't really addressed, hasn't been dealt with and so we've got this kind of anomalous situation. We've got daily hire employment, weekly hire employment and casual employment but there's no provision to tell anyone who opens the award how to work out the casual rate of pay. That's what brings us here today.

PN2568

VICE PRESIDENT HATCHER: So it is a dispute as to whether you'd calculate it by reference to the daily hire rate or the weekly hire rate?

PN2569

MS ADLER: That's one aspect of it.

PN2570

VICE PRESIDENT HATCHER: So just with that one aspect.

PN2571

MS ADLER: Yes.

PN2572

VICE PRESIDENT HATCHER: What's the mathematical relationship between the daily hire rates and the weekly rate?

PN2573

MS ADLER: The daily hire rate has a follow the job loading in it as well. The weekly hire rate doesn't.

PN2574

VICE PRESIDENT HATCHER: How much is that?

PN2575

MS ADLER: Well it's worked out as a fraction. Under 19.3(a), I guess there's a bit of a process so you take the minimum wage, you add the industry allowance and then where applicable the tool allowance and the underground allowance, and then on that amount you divide by 52 over 50.4 and then you add the special allowance, and then you divide it by 38 to get the hourly rate. That's set out in the award.

PN2576

VICE PRESIDENT HATCHER: Right. So that doesn't apply to weekly.

PN2577

MS ADLER: No, weekly hire sets out - you find the minimum wage, the add the special - the industry allowance and then other allowances where applicable and then you divide that by 38. So the difference is the follow the job loading. For a weekly hire it doesn't apply whereas the daily hire does. So in one of the matters - one of the matters of controversy is whether you apply the 25 per cent loading to the rate including the follow the job loading, which would be daily hire rate or the weekly hire rate which doesn't.

PN2578

VICE PRESIDENT HATCHER: Where do daily hire and weekly hire tend to be used in practice?

PN2579

MS ADLER: From our members' point of view in residential construction, generally they engage weekly hire.

PN2580

VICE PRESIDENT HATCHER: So do I take it from daily hire it's more a commercial construction model of employment?

PN2581

MS ADLER: My friends might know the answer to that better.

PN2582

VICE PRESIDENT HATCHER: That's the first aspect of the problem.

PN2583

MS ADLER: That's the first aspect.

PN2584

VICE PRESIDENT HATCHER: What was the other aspect?

PN2585

MS ADLER: So our variation seeks to have the allowances apply after the loading. So in line with the provisional view of the Commission in the decision of 13 July 2015, which is FWCFB 4658, where the Commission held a view that you should apply the 25 per cent loading just to, I guess, for lack of a better word the base rate, which under the Building Award would be the rates in clause 19.1(a), add the loading and then add any other allowances.

PN2586

COMMISSIONER ROE: Ms Adler, can I just ask you a question at that point?

PN2587

MS ADLER: Of course.

PN2588

COMMISSIONER ROE: Didn't the Full Bench in a subsequent decision say that that provisional - rejected that provisional view and instead made a decision that was essentially the opposite?

PN2589

MS ADLER: They did, they did, Commissioner and I guess my point to that is that in that decision they did suggest that an award by award approach was appropriate and I guess that's what I'm seeking to put to this Full Bench, is that in this instance it is appropriate to add the loading prior to the addition of the allowances.

PN2590

VICE PRESIDENT HATCHER: For the purpose of your variation, does that include or not include the follow the job loading?

PN2591

MS ADLER: It not does include.

PN2592

VICE PRESIDENT HATCHER: So are they the two issues; one whether the follow the job loading is applied to a casual and secondly, whether the casual loading is applied before or after the allowances.

PN2593

MS ADLER: That's right, your Honour.

PN2594

VICE PRESIDENT HATCHER: Thank you.

PN2595

MS ADLER: I think you've stolen my thunder.

PN2596

VICE PRESIDENT HATCHER: So now we can start the case.

PN2597

MS ADLER: So I'd still put to you that the two questions I posed at the beginning are relevant for your consideration. Our members open the award and don't know how to work out the casual rate of pay. It's not clear, and you know I think from our submissions, from the MBA's submissions and even from the unions' submissions it's clear there's the controversy around it that hasn't been resolved even during the transitional view, out of the 2012 modern award review decision. What I'd like to do now is just deal with some matters that arise from the CFMEU's submission and then provide a few closing comments, and obviously any questions from the Bench.

PN2598

So there are four matters that arise from the CFMEU's reply submission dated 22 February that I'd like to deal with. The first matter is the so-called consent position that arose out of the 2012 modern award review, and we would dispute the categorisation that the union makes as a consent position. The second issue relates to the purpose of the casual loading and how that interacts with the follow the job loading. The third issue relates to the so-called all-purpose allowances and the application of the 25 per cent casual loading to those allowances, and then the final matter I'd seek to deal with is the types of employment that can be used under the on-site award.

PN2599

Coming back to my first point, the consent position. So to provide a bit of context for the Bench, during the 2012 review both the unions and the employer parties proposed variations to the on-site award in relation to the calculation of the casual rate of pay. For the present purposes it's relevant to note that HIA's variation sought to amend clauses 14.5 to 14.7, which are within the casual employment provisions to insert a reference to clause 19.3(b), which is the weekly hire rate which we've just discussed, for the purposes of the application of the loading. While the application of the CFMEU sought to amend clause 14.5, so that the 25 per cent loading was based on the hourly rates calculated in accordance with clause 19.3. So remove the specificity that we sought to put.

PN2600

The Commission rejected both of our claims. The decision arriving out of the 2012 modern aware review also set out the agreement between the parties to the use of consistent terminology, in reference to the appropriate rate of pay. This is also extracted in the CFMEU's submissions where they at page 10, 11, 12, 13, 14, 15, extract the relevant table of provisions where we replaced various references to hourly rate, rate of pay, with ordinary time hourly rate. As a result of the rejection of both the union and the employer claims and the agreement to use consistent terminology throughout the award, the parties were asked to make submissions in relation to any consequential variations with respect to clauses 14.5, .6 and .7, the various casual provisions.

PN2601

The consequential agreement to change the terminology used in clause 14.6 and 14.7 was premised on the need for consistency and to make the award simpler and easier to understand. It is HIA's position that the use of the term ordinary time hourly rate was simply a matter of administrative convenience. HIA submits that the CFMEU in their submission at paragraph 30 had conflated two distinct issues. The first issue relates to the application of the casual loading to allowances and the dispute over those which are considered as all-purpose. The second relates to the insertion of this definition of ordinary time hourly rate, which we would say simply based on an extension of existing award provisions. The definition in clause 3 simply says the ordinary time hourly rate for weekly hire employees calculated in accordance with clause 19.3(b). So there was those that have changed the award, simply a referencing exercise.

PN2602

We did not concede anything in the relation to the nature of certain allowances and the application of the casual loading to those allowances. We would say the union is attempting to misconstrue HIA's position in that regard. We also reject the position of the CFMEU that the insertion of the term ordinary time hourly rate has resolved the issue, in relation to the calculation of the rate of pay for a casual employee.

PN2603

In fact, at paragraph 35 the CFMEU concede that an area of contention that remains is whether or not the daily hire rate which includes the follow the job loading should be used as the basis for the application of the 25 per cent loading. It's also relevant that when we inserted the term ordinary time hourly rate we didn't include any reference to the casual rate of pay, and as such would suggest there remains a controversy over that and the parties couldn't agree.

PN2604

This controversy is also reflected in the decision of Watson SDP during the 2012 modern award review, and at paragraph 188 of that decision his Honour identified the (indistinct) of that debate, as to the interaction between the follow the job loading and the casual loading, and that it wasn't fully ventilated during the 2012 modern award review.

PN2605

This brings me to the next matter which is the interaction between the casual loading and the follow the job loading. Now while I commend the CFMEU for taking us back to 1913, I don't really think it's necessary in this case. What is necessary is to address the claims at paragraph 41 of the CFMEU's decision, which state that the intent of the casual loading is simply to ensure that casuals are not a cheaper form of labour than daily or weekly hire. I think the intent of the casual loading is well settled. Both the award provision and the secure employment test case clearly provide guidance on this issue and are we would say the relevant references from which to draw conclusions about the purpose and intent of the casual loading.

PN2606

Moving to the justification of the application of the casual loading to a rate including follow the job loading, the union simply have no reply. To this, at paragraph 48, they suggest we're just simply wrong and then at paragraph 9, that the amount of lost time or lost wages that a casual can potentially suffer is significantly greater than daily hire employee, and that's why the follow the job loading should be included and then the casual loading on top. That's all they bring.

PN2607

We say there's no merit or foundation to those positions and it must be rejected. In fact, the position taken by the CFMEU that both a casual and a daily hire employee experience the same type of itineracy employment simply strengthens the argument that there's no justification that a casual employee be compensated twice for the same circumstances.

PN2608

Now the view of the CFMEU towards the advice from the Fair Work Ombudsman is less than favourable, but as an employer the advice of the regulator is important. They're the ones who are going to enforce the laws and so we take notice of their advice. At Attachment E of HIA's submission is a draft position paper from the ombudsman, in relation to the application of the casual loading. In their view, it is clear that a casual is not entitled to the follow the job loading. That's at page 38 of our submission. We say there is simply no basis on which the casual loading should apply to a rate inclusive of the follow the job loading.

PN2609

This brings me to my next point, which is the interaction between allowances under the award and the application of the 25 per cent casual loading. Contrary to the submissions of the CFMEU, we have not ignored the decision that Roe C asked me about earlier in relation to the application of the casual loading in 2015 FWCFB 6656. We address this is paragraph 6.1.14 to 6.1.16 of our submission. As I mentioned earlier, the Bench specifically noted that this could be considered on an award by award basis and that's what we seek to do.

PN2610

We also maintain the position that's disputed by the union that the characterisation of allowances under the award remains unclear. For example, a number of allowances that are listed as forming part of the weekly or daily hire rates under clause 19.1(a) and (b) are not characterised as such within the award. So for example, clause 21.1 is a special allowance, that doesn't talk about it being paid for all purposes in the provision. The only reason that we now to pay it as part of a weekly hire rate is because under clause 19.1(b) it sets it out. But for a casual we don't have similar guidance so how do we know?

PN2611

Further, even the Fair Work Ombudsman have a slight different view of these allowances to which the 25 per cent loading should apply. Their advice indicates that the industry and special allowance be included prior to the application of the loading, and then the tool allowance added after. So it's another version of how this casual rate of pay should be calculated. In section 6.3 of our submission we focus on going through each one of these allowances listed in clauses 19.1(a) and (b) and discuss the validity of applying a 25 per cent loading to those allowances. I would say the union has brought no response to that analysis.

PN2612

Moving onto the issue of the categories of employment under the award which I think is almost the basis of a number of the issues that brings us here today. I think there's a fundamental difference in opinion about how a casual employee can be engaged, and this obviously impacts on the appropriate rate of pay. It's HIA's strong view - - -

PN2613

SENIOR DEPUTY PRESIDENT HAMBERGER: Sorry, can I just take you back a bit to the industry allowance and the special allowance.

PN2614

MS ADLER: Yes.

PN2615

SENIOR DEPUTY PRESIDENT HAMBERGER: Presumably if you're not a casual, let's say a weekly hire employee and you go on annual leave - - -

PN2616

MS ADLER: Yes.

PN2617

SENIOR DEPUTY PRESIDENT HAMBERGER: - - - you get - that's included in your annual leave.

PN2618

MS ADLER: Yes, you do and then for the annual leave loading there's a slightly different calculation.

PN2619

SENIOR DEPUTY PRESIDENT HAMBERGER: Right.

PN2620

MS ADLER: So you go on annual leave, you should receive what you would normally receive if you - - -

PN2621

SENIOR DEPUTY PRESIDENT HAMBERGER: So you get your industry allowance and special allowance.

PN2622

MS ADLER: For the leave loading you don't receive the special allowance, so again another factor which sort of militates against it being paid for all purposes.

PN2623

COMMISSIONER ROE: Could I also ask question about the same point.

PN2624

MS ADLER: Of course.

PN2625

COMMISSIONER ROE: Thank you. Do you disagree that the effect of the Full Bench decision, the second one, is effectively that you would apply the casual loading after all-purposes allowances, which of course the industry allowance et cetera are all-purposes allowances, that the effect of that decision is that you should apply the casual loading after all-purpose allowances and if you want to not do that in this case you've got to have some special reason. So what's the special reason, what makes it different in this award to all the other awards which the Full Bench said should be handled in that way?

PN2626

MS ADLER: I guess I've got two responses to that. The first response is that there's still disagreement about what an all-purpose allowance is under this award. As I indicated, whilst clauses 19.3(a) and (b) set out those allowances to be included for the purposes of the ordinary time hourly rate, a number of the provisions associated with that list do not say they're payable for all purposes. So on the face of the award, without looking at the history of the award, if someone were to pick up this award today and read those individual allowance provisions, we would say it's not clear that they're payable for all purposes.

PN2627

VICE PRESIDENT HATCHER: Ms Adler, is that relation to just some of them or all of them? Is at least in some cases - - -

PN2628

MS ADLER: In some cases it does specify that they are payable for all purposes, yes.

PN2629

VICE PRESIDENT HATCHER: Which are those?

PN2630

COMMISSIONER ROE: Certainly the industry allowance, isn't that's all-purpose; there's no doubt about that is there?

PN2631

MS ADLER: Well, Commissioner, in the actual wording of the provision it does not say it is payable for all purposes.

PN2632

VICE PRESIDENT HATCHER: Which ones are specified as all-purpose?

PN2633

COMMISSIONER ROE: What purpose in the award is - what purpose in the award is industry allowance not payable for?

PN2634

MS ADLER: Well, I guess this comes back to the original point that under clause 19.1(a) and (b) it sets out that they will form part of the weekly rate, and then everything else flows from that. But in the case of a casual it's not set out that way, so without the provision specifying it's payable for all purposes, we would say there's a controversy over how that provision should be applied.

PN2635

DEPUTY PRESIDENT KOVACIC: So can I just unpack that a little bit.

PN2636

MS ADLER: Yes.

PN2637

DEPUTY PRESIDENT KOVACIC: So to the extent that it's an allowance that's payable for all purposes, you accept that it's part of the base rate on which the casual loading is calculated. Is that the tenure of your submissions?

PN2638

MS ADLER: No, I would accept that it is part of the rate of pay for a daily hire or weekly hire employee because that's what the award says.

PN2639

VICE PRESIDENT HATCHER: Leaving aside the question of whether it's daily hire or weekly hire, the expression that an allowance is part of the ordinary weekly pay rate - - -

PN2640

MS ADLER: Yes.

PN2641

VICE PRESIDENT HATCHER: - - - usually has the result that it automatically then forms the basis of a casual rate upon which the loading operates. Isn't that right?

PN2642

MS ADLER: Well, I don't know if other awards have provisions which say that but this award doesn't.

PN2643

VICE PRESIDENT HATCHER: Well, it follows doesn't it because - - -

PN2644

COMMISSIONER ROE: But Ms Adler, the Full Bench, isn't that precisely what the Full Bench in its second decision was dealing with, that there were lots of awards where there wasn't specific reference to whether the casual loading applied to a particular allowance. But the general principle the Full Bench adopted was if it applies for all purposes in the award generally, then it would apply - then the casual loading would apply after that calculation's made.

PN2645

MS ADLER: Yes, and I'm not - and that was obviously the decision of the Fully Bench who also said that there was scope to consider each award on their own, and also what I'm suggesting is that perhaps in those other awards which I'm not familiar with, that the provisions of the allowances specified how they should be treated and how they should be paid. Whereas we had this issue in the on-site award where not - each one of those allowances specify they're paid for all purposes, and the only reason we come to that conclusion on reading the award as it is now is the way clause 19.1(a) and 1(b) are drafted.

PN2646

COMMISSIONER ROE: Well, I don't think that that's a distinction that can be made because I know, for example, the most common - in other awards the most common all-purpose allowance is for example a leading hand allowance, and in other awards it doesn't generally specify that the leading hand allowance will apply for all purposes. That doesn't happen in every case. I'm not saying it doesn't happen in some cases but it doesn't happen in every case. So I think the - I think it really comes back to the second question I asked which obviously we haven't given you a chance to answer yet, and that is what distinguishes this award from all those other awards where the Full Bench has adopted a general principle?

PN2647

MS ADLER: Yes, Commissioner, thank you. I guess the second point that I'd make is that in our submission we go through and analyse each of these allowances and suggest that a casual employee would experience the disabilities associated with each of those allowances, in the same way as a full-time employee, so how can you justify a casual receiving an additional 25 per cent, when a full-time employee under the same circumstances does not.

PN2648

COMMISSIONER ROE: Can I just ask you one more question about that, I'm sorry to be persistent.

PN2649

MS ADLER: That's okay.

PN2650

COMMISSIONER ROE: If you go to my example of the leading hand allowance in any other award, right. So lots of awards have leading hand allowances.

PN2651

MS ADLER: Yes.

PN2652

COMMISSIONER ROE: They're generally for all purposes and under the principle adopted by the Full Bench, the 25 per cent loading will apply to the leading hand allowance. But a leading hand, whether they're a casual or a permanent, how is that any different to the distinction you make in respect of the all-purpose allowances in this award?

PN2653

MS ADLER: Well, in respect of the leading hand allowance specifically, under the on-site award the provision may be a little different to how it's drafted in other awards. The leading hand allowance in clause 19.2 specifically addresses how daily hire employees are paid the leading hand allowance, and that for daily hire it is payable for all purposes. But again, I don't know, it doesn't flow from that that a casual employee should also receive the allowance for all purposes. It specifically says that for a daily hire employee that amount will apply for all purposes of the award.

PN2654

COMMISSIONER ROE: But that wasn't quite my question. My question was if in other awards the leading hand allowance is regarded as an allowance based on this Full Bench decision, to which the 25 per cent loading applies, then your general argument that the disability isn't 25 per cent greater for a casual leading hand versus and non-casual leading hand, well the Full Bench has decided that the casual employee is entitled to 25 per cent on top of their leading hand allowance. So why is it different in this award in respect of the allowances that you're referring to?

PN2655

MS ADLER: I guess, Commissioner, I'm suggesting that the drafting of these provisions don't allow that general proposition to apply in every case.

PN2656

COMMISSIONER ROE: Thank you.

PN2657

DEPUTY PRESIDENT BULL: Ms Adler, I take it most of your members if not all of them have enterprise agreements.

PN2658

MS ADLER: No, they're award covered.

PN2659

DEPUTY PRESIDENT BULL: Most of your members are award covered?

PN2660

MS ADLER: Yes.

PN2661

DEPUTY PRESIDENT BULL: Right.

PN2662

MS ADLER: In the residential construction industry most of our members are covered by the award.

PN2663

DEPUTY PRESIDENT BULL: And what, some have agreements?

PN2664

MS ADLER: No, not that I've seen in the six or seven years that I've been working for HIA.

PN2665

DEPUTY PRESIDENT BULL: Thank you.

PN2666

MS ADLER: Moving to the notion of the different categories of employment under the award, which as I mentioned I think is the source of a lot of the contention that we're talking about here today, and which obviously affects the rate of pay. It's our strong view that casual employment is a standalone employment type, in contrast to the position of the CFMEU who suggest that you can engage a daily hire casual employee or a weekly hire casual employee. We would say that's simply a contradiction in terms.

PN2667

Clause 10.1 of the on-site award clearly sets out four distinct types of employment, being daily hire, full-time weekly hire, part-time weekly hire and casual employment. If it was the intention that casual employment also be categorised as daily or weekly hire, then surely that would have been specified in the list at clause 10.1. This distinction has in fact been recognised by the Commission in the decision of Watson SDP during the 2012 modern award review, who rejected an application by the union to vary the award to insert the words "daily or weekly hire" before casual in clause 14.3 of the award.

PN2668

Surprisingly the history of the types of employment and the interaction that follow the job loading and the casual loading under the National Building and Construction Industry Award forms much of the CFMEU's opposition to HIA's proposal, and we would say three things in response to that. Firstly, it has been determined by the Full Bench in the preliminary jurisdictional issues decision of 2014 FWCFB 1788 that the history of the award will be relevant consideration during the review, and provide context but it shouldn't be determinative of an outcome. To that end, the CFMEU only refer to provisions from the national pre-reform award, no other pre-reform award's mentioned in their submission.

PN2669

Secondly, in this case the provisions of the on-site award in relation to the rate of pay calculations do not reflect what was in some pre-reform award, so there's been a shift. With respect, we would say that some have moved forward on the assumption that those in the industry are aware of what was contained in pre-reform awards. For example, again in the 2012 modern award review decision and the reference is 2013 FWC 4576, Watson SDP in rejecting a claim of the CFEMUE stated:

PN2670

The CFMEU submitted that the hourly rate calculation for daily hire employees include the follow the job loading. There is no evidence that the terms of clause 14.3 and/or clause 14.5 have disturbed this practice reflected in most of the pre-reform awards of applying this loading to casuals.

PN2671

So we're reading into the award how it should apply, as opposed to being able to on its face work out how to work out the casual rate of pay.

PN2672

Thirdly, in reflecting on his Honour's decision in my earlier point in relation to these categories of employment, the modern award has changed the way an employee can be engaged under the on-site award. The Fair Work Ombudsman has noted this difference in their advice, which as I said was at Attachment E to our submission, where they say:

PN2673

We note that the differences between the Building Modern Award and the National Building and Construction Industry Award is that the NBCIA specifies the different calculation methods apply to employees in certain classifications. Whereas the Building Modern Award specifies that different calculation methods apply to different types of employment.

PN2674

Sectorial differences was not transposed from the pre-reform awards into the modern award. For example, no longer is daily hire engagement restricted to the trades personal labourer classification as it was under the national pre-reform award. As outlined in his Honour's decision at paragraph 173, and extracted in the CFMEU's submission at paragraph 56, his Honour noted the specific consideration of this issue during award modernisation.

PN2675

As noted in the Full Bench decision of 13 July, which is 2015 FWCFB 4658, when dealing with the ordinary hourly rate of pay and in discussing the process of reviewing and redrafting the awards, the Bench noted that:

PN2676

An award should be able to be read by an employer and an employee without the need for a history lesson or a paid advocate to interpret how it is to apply in the workplace.

PN2677

We would say the currently on-site award does not meet that comment.

PN2678

Moving onto considering the practical impact of the way the award works at the moment. I'll take you back to the first question that I asked, "And how simple is it to work out the casual rate of pay under the award". We've addressed this in our submissions at section 6.2 through the statement which was marked exhibit 306 and the advice of the Fair Work Ombudsman.

PN2679

We reject the claim at paragraph 59 of the CFMEU's submission that simply the inclusion of a rate of pay schedule within the award will resolve this matter. Just put a schedule in the back and it'll all be fixed. I don't think so. The point is that the minimum wages clause, clause 19, is silent in relation to the calculation of the casual rate of pay. Also, clause 14.5 of the on-site award provides no link back to clause 19, as I mentioned earlier, in order to direct somebody as to how to apply the 25 per cent loading.

PN2680

If I could just take the Bench to Attachment D of our submissions, which is exhibit 306. Just to demonstrate the complexity of the rate of pay calculation. Just for clarity there are a couple of assumptions that underlie Annexure A particularly. The first is that the weekly hire rate is used as the basis for the calculation, so this is page 35 of our submission. So does not include the follow the job loading, and then of course as we've discussed because of the way clause 19.1(b) is drafted, the allowances that flow from using that weekly hire rate will have the loading applied to it.

PN2681

The evidence shows that there are a number of steps involved in working out the casual rate of pay and that in some instances you first of all need to have a detailed understanding of the award, and even in some instances the historical development of the provisions. The most important steps we would say are steps 4 and 6. Step 4 which is entitled "Apply all-purpose allowances" requires an understanding that for example, as we've discussed, despite the industry and special allowance provisions not stating they're payable for all purposes, they form part of the weekly hire rate under clause 19.3(b), and then you go on and select which allowances apply and add them to the rate.

PN2682

Then step 6 - so then you apply the loading, and then step 6 requires you to go back and check what other allowances might apply. So there's two steps in there which our variation would remove. If you turn to Annexure B you'll see that step 4 disappears, you have the minimum rate under clause 19.1(a), you apply the casual loading and then you go on the hunt through the pages of allowances in the award and work out what else applies and add that on top.

PN2683

VICE PRESIDENT HATCHER: With respect to the all-purpose allowances, how many as it were permutations can you have as to what the outcome might be. I mean do people - is there just a couple of scenarios or is there - is it more complex than that? I ask that question by reference to whether it is possible to just set out a rate schedule which sets the final rate rather than leave it to the parties to calculate anything.

PN2684

MS ADLER: Yes.

PN2685

VICE PRESIDENT HATCHER: Obviously there's too many scenarios and we can't do that but if there's only a few well you probably can.

PN2686

MS ADLER: I guess if you go off the weekly hire rate, generally the special and industry allowance will apply.

PN2687

VICE PRESIDENT HATCHER: Yes.

PN2688

MS ADLER: But then things like tool allowance will apply to different trades at different amounts. Underground allowance is a disability allowance so it will only apply in certain circumstances. Air conditioning allowance, electricians allowance and (indistinct) allowance, so they will only apply in certain circumstances. So while you could I suppose have a rate that has the minimum rate special and industry and then apply the loading, if you adopt the CFMEU's view, you'd have to re-engineer that to add back other allowances that might apply and then add the loading on top. So that's why we say you can't just have a schedule because there may be other circumstances that arise.

PN2689

VICE PRESIDENT HATCHER: Thank you.

PN2690

MS ADLER: That's as far as I wanted to take exhibit 303, unless there's any questions that arose from it. Also of note is the Fair Work Ombudsman's view, that while neither calculation being the daily or the weekly hire rate expressly excludes casual employees, our preferred view is that neither hourly rate calculation clause 19.3 applies to casual employees because 19.3(a) and (b) expressly apply to daily hire and weekly hire employees. We say the issue that we've demonstrated through the evidence and it's evident on the FWO's advice is clearly a matter that needs to be addressed.

PN2691

The final matter that I would like to deal with is Appendix 1 to the CFMEU's submissions. Now that sets out some calculations, doesn't really explain behind how those calculations were done but all I really want to say about it is one thing, and from what I can work out the hourly rates include the follow the job loading. All of those hourly rates include the follow the job loading, which is not necessarily the case under the award. So the starting point for everything that flows, we say is on an incorrect basis or it's on a convenient basis. That the follow the job loading is included, where we would say it's not. That's as far as I would like to take that but I think it's important to highlight that - how much weight that's given should be conditioned by the fact that the premise is that the follow the job loading applies, which is not necessarily the case.

PN2692

So just in closing and in briefly addressing the modern award's objectives, I just take you back to the two questions I posed at the outset. Firstly, can you on opening and reading the on-site award work out a casual rate of pay? The second question is why should an employee receive an additional 25 per cent loading on top of an allowance? The modern awards - - -

PN2693

VICE PRESIDENT HATCHER: Say it was the tool allowance which is recompensing you for provision of tools.

PN2694

MS ADLER: Yes.

PN2695

VICE PRESIDENT HATCHER: It might be said that if you're a full-time weekly employee you'll be getting an allowance every day so that presumably you'll receive full cost recovery of the tools you're providing. If you're a casual you can't be guaranteed that you'll be employed every day, you might be employed far from every day. In which case you're not receiving costs recovery for supplying the same sort of tools and therefore there should be some uplift on that to reflect the fact that the intermittence in employment doesn't allow you to cover the cost of tools in the same way as - - -

PN2696

MS ADLER: As a full-time.

PN2697

VICE PRESIDENT HATCHER: Is that one scenario that there would be a justification for the loading being applied to an allowance?

PN2698

MS ADLER: I would accept that, your Honour, but I would also say that then an a casual employee is not using those tools as frequently as a full-time employee. So the degrading of the equipment is arguably less than if you're using them every day, seven, eight hours a day.

PN2699

SENIOR DEPUTY PRESIDENT HAMBERGER: Let's assume that the only difference between a casual and a full-timer is that all - that they take the same amount of time off each year, they have the same amount of annual leave and the same amount of personal and carers leave, but they - but one of them gets paid for it and one of them doesn't. When you take into account that the full-time employee, that the non-casual employee will be getting the - not just tool allowance but will be getting the industry allowance, is getting that allowance when they're not there - sorry. Yes, when they're not at work, when they're taking paid leave, if you didn't - if you just paid the same flat amount to the casual employee; they're working the same number of days, actually working the same amount of days, not getting paid for the time that you're on leave, unpaid leave, they will actually get less over a year. It won't be they'll not be getting the same, they'll be getting less. Isn't that the logic?

PN2700

MS ADLER: I guess the only thing I could say in response to that is are we kind of expanding of moulding what the purpose of the casual loading actually is?

PN2701

SENIOR DEPUTY PRESIDENT HAMBERGER: Well, is it?

PN2702

MS ADLER: So under the - - -

PN2703

SENIOR DEPUTY PRESIDENT HAMBERGER: I mean if the casual loading's there to compensate for you know not getting annual leave, personal and carers leave et cetera - - -

PN2704

MS ADLER: Yes. But not for not getting those allowances when they're not working.

PN2705

SENIOR DEPUTY PRESIDENT HAMBERGER: But it's - right. Anyway I've put my proposition to you, you don't have to agree but can you see where I'm coming from?

PN2706

MS ADLER: Yes, I do, I do, your Honour, yes.

PN2707

COMMISSIONER ROE: Ms Adler, can I just ask you one question. Is the effect of your submissions about the issue of types of employment, does that really - is that really just another way of looking at the follow the job allowance and why the follow the job allowance should not, from your perspective, be included?

PN2708

MS ADLER: Well, it - - -

PN2709

COMMISSIONER ROE: Is that - - -

PN2710

MS ADLER: Sorry, Commissioner, it definitely - - -

PN2711

COMMISSIONER ROE: Is that the difference that - is that the key point that would arise from that?

PN2712

MS ADLER: Well, it definitely goes to that point but it also goes to the lack of clarity under the award as to how you calculate the rate.

PN2713

COMMISSIONER ROE: Right, thank you.

PN2714

VICE PRESIDENT HATCHER: One other thing, Ms Adler. The absorption of casual loading decision from last year at paragraph 109, insofar as it allowed the parties to have an award by award approach which might allow for a departure from the general proposition, it did so on the basis that award by award a party could suggest that an allowance should lose its all-purpose designation. That is not that there would be some special rule for casuals but that, for example, if there's a tool allowance which is currently expressed as an all-purpose allowance, you could mount a case that it should not be an all-purpose allowance and then nobody would get it on an all-purpose basis. Isn't that what the Full Bench had in mind?

PN2715

MS ADLER: I guess, your Honour, my read of it was that it was confined to the way the casual loading is applied. So that it would lose its all-purpose designation for the purposes of the casual loading, not necessarily for any other purpose.

PN2716

VICE PRESIDENT HATCHER: Right.

PN2717

MS ADLER: Just in concluding, your Honours and Commissioner, the modern awards and the national employment standards are to provide a fair and relevant safety net. The modern awards objectives require the consideration of a variation in light of amongst other things its impact on business, including productivity, employment costs and regulatory burden, and the need to ensure a simple, easy to understand stable and sustainable modern award system. We would say HIA's variation furthers these objects on three bases. The first is that casual employment is a standalone form of employment and as such it should be clear how the rate of pay for a casual employee is calculated. The differing views as to how this is done clearly demonstrate that it's currently not clear under the award.

PN2718

Secondly, no legal basis has been put to justify the entitlement of a casual employee to both the follow the job loading and the casual loading. We would submit that these loadings compensate for the same characteristics and it's manifestly unfair and imposes unjustifiable costs on an employer to compensate an employee for the same characteristic twice. Finally, we would submit and although I've been challenged on it, that the award lacks clarity as to how a number of allowances should be treated under the on-site award, and we would submit that no real response has been put by the union to our written submissions on the purpose and character of a number of allowances which stands at odds with applying the casual loading to those amounts.

PN2719

HIA ask the Bench to consider the issues raised and the questions posed and in light of this we would urge you to adopt the HIA's variation. Thank you, your Honours.

PN2720

VICE PRESIDENT HATCHER: Sorry, there is one more question, Ms Adler.

PN2721

MS ADLER: Yes.

PN2722

VICE PRESIDENT HATCHER: The follow the job loading - I think I asked this before but I can't remember what you said except it was complicated. What's it roughly worth in terms of - if you try to convert it to some sort of percentage, I'm not asking you to be precise, what's it worth?

PN2723

MS ADLER: Mr Maxwell might know off the top of his head. I could work it out.

PN2724

MR MAXWELL: It is roughly 1.6 per cent.

PN2725

MS ADLER: Of the minimum rate. No.

PN2726

MR MAXWELL: No, 1.6 per cent of the total rate including the all-purpose allowance.

PN2727

MS ADLER: Including whatever's listed in 19.1(a).

PN2728

DEPUTY PRESIDENT KOVACIC: Ms Adler, can I just perhaps ask a couple of questions.

PN2729

MS ADLER: Of course.

PN2730

DEPUTY PRESIDENT KOVACIC: Given the thrust of one of the key elements in your submissions is a lack of clarity in terms of - so what's the practice in the industry, if I can put it that way?

PN2731

MS ADLER: We provide our members with a casual rate based on the weekly hire rate. That's based on ombudsman's advice, and it's based on I guess a risk mitigation assessment in light of what the union's view on the rate is.

PN2732

DEPUTY PRESIDENT KOVACIC: The other question I have is to what extent has the issue been an issue that's either the cause of disputation or disagreement, if I can put it that?

PN2733

MS ADLER: Between an employee and an employer?

PN2734

DEPUTY PRESIDENT KOVACIC: Yes.

PN2735

MS ADLER: I guess I haven't seen - I mean we get queries about how the rate's calculated. I guess that's as best as I could characterise it. We haven't come across a dispute about it and maybe that is because of the uncertainty around it. So I couldn't give you a precise number but it comes up from time to time.

PN2736

DEPUTY PRESIDENT KOVACIC: Thank you.

PN2737

VICE PRESIDENT HATCHER: Thank you.

PN2738

MS ADLER: Thank you.

PN2739

VICE PRESIDENT HATCHER: Ms Sostarko.

PN2740

MS SOSTARKO: Thank you. Are you happy for me to stand here?

PN2741

VICE PRESIDENT HATCHER: Whatever's convenient.

PN2742

MS SOSTARKO: Thank you, rather than make my friend move all her things. Thank you, your Honours and Commissioner. Master Builders Australia has also filed a submission in this matter, most recently dated 26 February 2016, which also incorporate our earlier submissions. I would take those submissions as being read, yes.

PN2743

VICE PRESIDENT HATCHER: Yes.

PN2744

MS SOSTARKO: Again, the submissions deal with this controversy which is from our perspective not whether or not the casual loading under the on-site award should be payable with reference to the daily or weekly hire rate, and as we've noted the question isn't new. It was considered in 2012 as part of the two yearly review, and in our view remains unresolved, with the Commission in its 2013 decision noting that the issue does in fact require broader consideration as part of this four yearly review process.

PN2745

We also submit that as there are contemporary examples which are annexed to our February submissions marked at Attachments D and E, which are pay rate schedules of both Master Buildings New South Wales and the CFMEU, demonstrate that the controversy continues and they demonstrate a divergence of interpretation in terms of how the rate of pay is calculated for casual employees.

PN2746

VICE PRESIDENT HATCHER: So to what extent are casuals used using commercial construction?

PN2747

MS SOSTARKO: So we have a have a slightly different take-up in terms of use of the award. There is a much broader proportion of our membership that would be either engaged under a union or a company specific enterprise agreement. In terms of your earlier question to Ms Adler about the engagement of daily hire employees, my understanding is that under the award around the vicinity of 50 per cent of people are in fact engaged under daily hire, and of those two thirds would be either trades people or labourers. So if that assists in any way.

PN2748

VICE PRESIDENT HATCHER: The rest are what, weekly hire are they or casuals or - - -

PN2749

MS SOSTARKO: That's a question that I would have to get instruction on, I'm sorry. I wouldn't have those statistics for you right now but I'm happy to provide them if that's helpful. The parties in submissions have put together a range of solutions to address the issue. We are of the view that our solution in the form of our draft determination, which is at Attachment A of our 26 February submissions, which seeks to define the ordinary hourly rate for casual employees with reference to the weekly hire rate, which we say are inclusive of the special and industry allowances under clause 19.3 is the most appropriate solution.

PN2750

VICE PRESIDENT HATCHER: Inclusive of the - - -

PN2751

MS SOSTARKO: Well, we would acknowledge that the base rate, it is our view, should be based on 19.3(b) being that of the weekly hire. The benefit of our solution, which is slightly a different approach to the HIA is that it provides the necessary clarity, reflects what we say is current industry practice and with regard to the payment of casual workers. Given that wage sheets that are disseminated from our membership to our members are based on the weekly hire rate. I'll go into more detail in a moment as to how we've reached those conclusions.

PN2752

Our draft determination also doesn't seek to disturb daily hire engagement given the high propensity of it in our sector. Recognises that there is a history of that particular type of engagement and the desire for the industry to retain it, and it's also as Ms Adler said, it's consistent with the advice of the Fair Work Ombudsman. The reason for us, in addition to seeking clarification is as more businesses who don't have the benefit of the historical knowledge enter the construction centre, the need for clarification is even more essential, so that the award also better meets the modern award's objective.

PN2753

If you wouldn't mind I just would like to just elaborate a little bit more about the history, which might assist. So due to the project based nature of the industry, daily hire was and continues to be a common form of engagement. As part of that, follow the job loading which is inclusive in the daily hire arrangement was provided for under the pre-modern award, which is the NBCIA, which is under clause 13.2. So follow the job loading was established to account for the incidence of loss of wages for periods of unemployment between jobs but was confined to daily hire employees under the pre-modern award. Therefore, was not an allowance in our view for all purposes.

PN2754

So under the NBCIA, however, it's worth noting for example casual operators were able to be engaged under a weekly hire arrangement. So the point being though that given that at that time there was no other way that trades people and labourers could be engaged, other than under a daily hire arrangement, there was no other source or base rate upon which to calculate hire for or the rate for casual employees.

PN2755

I guess the basis of the CFMEU's position is that the history of how a trade person and labourers were previously engaged and might I note, and I think Ms Adler mentioned as well, that there are no longer restrictions in that regard. Casuals can be employed under - there is no restriction as to how they might be employed and - sorry, let me say that again. Tradespeople and labourers, for example, any categorisation of worker, there's no limitation upon - the basis upon which they can be employed. So therefore they can be employed on a weekly hire basis, as opposed to in the pre-modern award.

PN2756

So the unions will say that the daily hire rate should be used as a result of the history that was associated with the pre-modern award, and that that should form precedent and carry through in terms of how those employees continue to be engaged, even under the on-site award. As I said, that restriction has now been removed and therefore that view is moot in our view.

PN2757

Secondly, the on-site - sorry, thirdly, I'd like to bring the Commission's attention to the decision in Tellam Civil Queensland Pty Ltd v CMFEU. I can give you the citation if that's helpful. Which is [2013] FWCFB 2434, where in that decision a line was drawn between pre and post-modern awards, and the decision essentially said that the authority should be drawn from the latter.

PN2758

The history of how the rate of pay was calculated for casuals under the pre-modern award is relevant to understand how we got to this point in terms of there being confusion and uncertainty, but not in the context that the past method is now accepted by the industry and forms any kind of settled approach. But rather that the modern award now provides for a different regime under which certain classification of casual workers can now be engaged.

PN2759

As I've said, it's tradesperson and labourers unlike operators who previously could also be appointed on a weekly hire arrangement pre-modern award. Now that's no longer the case. So the making of the modern award had the effect of no longer imposing those restrictions on how those kind of workers are imposed, and therefore although the CFMEU has acknowledge that in their submissions, they've conveniently overlooked the fact that that's no longer the case. As Ms Adler mentioned, they've also suggested that these issues were dealt with by agreement during the 2012 review, but that's certainly not our position and it's not reflected - it's reflected in the fact that we've made repeated submissions on this issue in seeking clarification and also referring back to that decision in 2013, as a result of the 2012 review.

PN2760

I guess the key to all of this is that we're of the view that by applying the casual rate to the daily hire rate, or utilising the daily hire rate as the base rate is essentially a double dip. It compensates for the same, what you might consider, disability twice. In addition to that, clause 10.1 of the on-site award provides four distinct categories of employment being daily hire, full-time weekly hire, part-time weekly hire and casuals, and opposed to - as opposed to casual workers with the exception of termination provisions, daily hire employees receive the same entitlements as full-time and part-time employees under the NES; such as annual leave, personal and parental leave, redundancy, public holiday entitlements. Of course under - - -

PN2761

VICE PRESIDENT HATCHER: How does redundancy operate for daily hire employees?

PN2762

MS SOSTARKO: How does it operate?

PN2763

VICE PRESIDENT HATCHER: I mean I assume unless it's a very long project that you'd never actually accrue it would you? I mean I suppose there are some long projects around but you'd have to work on a - on a specific project for over a year to entitle yourself to redundancy pay or not?

PN2764

MS SOSTARKO: Well, we have an industry specific scheme that provides for redundancy payments that are carried through. So they can be redeemed at different times.

PN2765

VICE PRESIDENT HATCHER: What's the event that triggers a payment under that scheme?

PN2766

MS SOSTARKO: Well, currently at the moment it depends on the amount of - the amount that's accrued and redeemed is dependent on the amount of time served obviously. At the moment where an employee ceases to be employed by an employer with whom the award applies, other than for reasons of misconduct, they are then eligible for redundancy depending on whether or not they've met the threshold of service or continuous service.

PN2767

VICE PRESIDENT HATCHER: So if you work for X - if you work on X project for an employer for six months and then there's - you're off for two weeks and then you work for a different employer for another project for six months and you keep on doing that, how does it work in that context?

PN2768

MS SOSTARKO: It's quite complex, not a question that I necessarily was prepared to respond to. If I could take that on as providing further advice on that I would appreciate it.

PN2769

VICE PRESIDENT HATCHER: Right.

PN2770

SENIOR DEPUTY PRESIDENT HAMBERGER: But do you agree that in the building industry you could - you might - well if you go from project to project but you could work for the same employer on different projects.

PN2771

MS SOSTARKO: Yes.

PN2772

SENIOR DEPUTY PRESIDENT HAMBERGER: So the fact that a project may not go for all that long, it doesn't mean that you might not stay with the same employer.

PN2773

MS SOSTARKO: Correct, and that's very much the nature of the industry, of course, because it is very much project based. But that doesn't mean that the employee would not work at different locations on different projects for the same employer.

PN2774

VICE PRESIDENT HATCHER: Is that typical or just as common?

PN2775

MS SOSTARKO: Yes, yes. So whereas of course under clause 14.5 casual workers are paid the 25 per cent loading to compensate for the lack of those benefits or entitlements. As Ms Adler mentioned, the flow(?) has repeatedly provided advice that in no instance a casual should be entitled to follow the job loading, and it's upon that basis that we've drafted our determination and our members provide that advice in the form of their wage sheets that are provided every year. Instead the flow has advised that the casual rate for an employee should be calculated under - sorry - is calculated by applying the casual loading to the sum of the minimum hourly rate in clause 19.1(a) and the industry and special allowances being, in our view, 19.3(b).

PN2776

Conversely, the CFMEU in our view has not offered an acceptable solution to the problem and effectively have sought to have it both ways, given that they've conceded that the restrictions around the engagement of particular types of employee such as tradespeople and labourers that were previously imposed under the NBCIA have now been lifted under the on-site. However, they make the assertion that casual labourers and tradespeople should continue to be paid with reference to the ordinary hourly rate for daily hire, which of course includes follow the job loading which we would argue was not a purpose - sorry, is not an allowance for all purposes.

PN2777

In addition, in their submission they've also I would even say more boldly suggest that the daily hire rate should be the base rate that's used for all classifications for employee, and we're of the view that this is complete mis-interpretation of the relevant provisions under the award. It's also a mis-representation of the history, given that as I mentioned previously our operators were able to be engaged under weekly hire, so why operators would not be referenced back to the daily hire rate, there's no logic or reasoning behind that. As I've said, workers who are receiving the casual loading would essentially be compensated twice for the same disadvantage.

PN2778

In addition, I would suggest that this approach would be an undoing of convention in that by referencing the 25 per cent loading - sorry - yes, to the daily hire rate, it's out of step with what occurs in other awards as well, which is more adequately reflected in 19.3(b). So we do say there's confusion. We do say that the issue needs to be resolved and this is the opportunity for that to occur and although daily hire continues to be a feature in our sector, the instruments now - it's changed and the way in which workers can be engaged has changed, and therefore by continuing to apply the loading to the pre-award instrument that's an incorrect interpretation of how the award should operate.

PN2779

The way the award is drafted currently increases obviously costs to business in terms of the double application, if that's to be accepted of that loading, and we would say that moving forward that we would need to have this issue clarified so that businesses know where they stand.

PN2780

VICE PRESIDENT HATCHER: Thank you.

PN2781

MS SOSTARKO: Thank you.

PN2782

VICE PRESIDENT HATCHER: Mr Maxwell.

PN2783

COMMISSIONER ROE: Can I just understand just one point.

PN2784

MS SOSTARKO: Yes.

PN2785

COMMISSIONER ROE: So the HIA in answer to questions that the Vice President raised at the beginning, made it clear that there were two practical issues involved here; one is the issue about whether the casual loading applies on top of allowances like the industry allowance. The second was the issue of whether the follow the job applied to casuals. You - - -

PN2786

MS SOSTARKO: So our clarification relates to the latter point.

PN2787

COMMISSIONER ROE: You don't - exactly. You don't agree with the HIA about the first point but you do about the second point. Is that correct?

PN2788

MS SOSTARKO: I wouldn't say that I don't agree, I don't have instructions - our approach is different. I wouldn't say we would outright disagree, however our solution is to propose that it be applied to 19.3(b).

PN2789

COMMISSIONER ROE: But in your calculations you do include the industry allowance and the special purpose allowance - - -

PN2790

MS SOSTARKO: Yes, yes.

PN2791

COMMISSIONER ROE: - - - and the tool allowance, and you apply the casual loading to that, don't you?

PN2792

MS SOSTARKO: Where applicable the subsequent allowances. We would say the special allowance and the industry allowance, yes, and as stated in the award where applicable those subsequent allowances.

PN2793

COMMISSIONER ROE: Yes.

PN2794

MS SOSTARKO: That position is - well, that's based the flow advice.

PN2795

COMMISSIONER ROE: Yes, but your - in your submission you're advocating a draft determination which would be - which would provide for the 25 per cent to be paid to a rate that includes the industry allowance and the special allowance.

PN2796

MS SOSTARKO: That's correct.

PN2797

VICE PRESIDENT HATCHER: And the other allowances where applicable.

PN2798

MS SOSTARKO: Correct.

PN2799

COMMISSIONER ROE: And the other allowances where applicable, yes.

PN2800

MS SOSTARKO: That's correct.

PN2801

COMMISSIONER ROE: Thank you.

PN2802

VICE PRESIDENT HATCHER: Mr Maxwell.

PN2803

MR MAXWELL: Thank you, your Honour. Your Honours and Commissioner, the CFMEU has filed a written reply to the HIA's submissions dated 22 February 2016 and we would seek to rely on those submissions. However, I have a number of points I'd wish to make in addition to those. First of all we note that - - -

PN2804

VICE PRESIDENT HATCHER: Just before you start. So do you agree that there's a problem that needs to be fixed? That is regardless of what the solution is, that the award needs to make clear what the casual rate is or at least how it's to be calculated.

PN2805

MR MAXWELL: We agreed that there is a problem of what ordinary time rate you apply the casual loading to. Whether it's the daily hire, weekly hire or dependent on classification, which one you refer it to. We don't agree with the HIA's submission that there is an issue in regard to the ordinary time rate including the all-purposes allowances and what allowances are all-purpose under this award. Because our submission is that that issue was specifically addressed by the parties in the 2012 award review and that is why we inserted definitions of the ordinary time hourly rates into the award, which are set out in our written submission.

PN2806

VICE PRESIDENT HATCHER: So you agree with the MBA on that point.

PN2807

MR MAXWELL: So we agree with the MBA views that the rates inclusive of the all-purpose allowances, and on that point - - -

PN2808

SENIOR DEPUTY PRESIDENT HAMBERGER: Do you think that's clear, that there's no need to change the drafting of the award?

PN2809

MR MAXWELL: We think that's clear and if I can refer you to 14.5 of the award which deals with what penalty rates apply to casuals, because that makes it clear that where the penalty is say time and a half, you use 175 per cent of the ordinary time hourly rates under the award. So the parties vary the award to make that clear that in those circumstances you use the ordinary time hourly rate for the calculation of penalties and loadings. So it doesn't matter if you're a daily hire employee or a weekly hire employee, you should apply the penalties, apply the penalties to the ordinary time hourly rate. If you're a casual you apply the loading to the ordinary time hourly rate. The issue is here what is the ordinary time hourly rate under the award, because we have both daily hire employment and weekly hire employment.

PN2810

SENIOR DEPUTY PRESIDENT HAMBERGER: Do you agree that's not all that clear at the moment as it stands?

PN2811

MR MAXWELL: It's really a problem caused by the inclusion of extension of weekly hire employment to tradespersons and labourers under the modern award. It wasn't - - -

PN2812

SENIOR DEPUTY PRESIDENT HAMBERGER: Who did it apply to before? Sorry for my ignorance but who - - -

PN2813

MR MAXWELL: Well, prior to the modern aware the weekly hire was only the operation classifications.

PN2814

SENIOR DEPUTY PRESIDENT HAMBERGER: Yes, right.

PN2815

MR MAXWELL: In - and I do have an exhibit here of the provisions of the National Building and Construction Industry Award 2000 which actually had the rates of pay for each of the classifications - - -

PN2816

SENIOR DEPUTY PRESIDENT HAMBERGER: When were the provisions for casual employment included in the award?

PN2817

MR MAXWELL: Back in, I think, 1913. Back in - - -

PN2818

SENIOR DEPUTY PRESIDENT HAMBERGER: Really, right. So it's always been there, yes.

PN2819

MR MAXWELL: The Archer Award.

PN2820

VICE PRESIDENT HATCHER: Restrictions were lifted when the modern award was made.

PN2821

MR MAXWELL: Yes, the restrictions on the weekly hire of tradespersons and labourers was lifted when the modern award was made.

PN2822

VICE PRESIDENT HATCHER: That in turn flowed onto casual employees?

PN2823

MR MAXWELL: Well, that led to this issue about well what rate do you use for tradespersons and labourers that are engaged on a casual basis.

PN2824

VICE PRESIDENT HATCHER: Do you agree with Ms Adler that there's too many scenarios for the application allowances to set out a schedule, setting out the dollar amount of the casual rate?

PN2825

MR MAXWELL: No, we don't.

PN2826

VICE PRESIDENT HATCHER: So how many scenarios are there?

PN2827

MR MAXWELL: Well, there are actually a limited number of scenarios because if you take the tool allowance, the tool allowance is only applicable to various classifications. So there's a carpenter's tool allowance, a painter's took allowance and so forth. The electrician's allowance obviously only applies to electrician, so that doesn't apply to carpenters and people and the same - - -

PN2828

VICE PRESIDENT HATCHER: Because you can only get one tool allowance or no tool allowance.

PN2829

MR MAXWELL: That's right.

PN2830

VICE PRESIDENT HATCHER: So what about all the others? The underground allowance, what's that?

PN2831

MR MAXWELL: Well, the underground allowance would only apply where employees are working underground which would be, under this award - someone engaged under the award terms working underground would be - I think you'd be lucky to find anyone that's not covered by an enterprise agreement.

PN2832

VICE PRESIDENT HATCHER: Well, can we abolish it then? Can we abolish it then? I mean aren't we - - -

PN2833

DEPUTY PRESIDENT KOVACIC: It'd be someone that's working on West Connects for instance doing the tunnelling on the road or something like that or would that be a different - that'd be Civil Construction Award.

PN2834

MR MAXWELL: Well, that would be civil construction but they'd be covered by an enterprise agreement.

PN2835

DEPUTY PRESIDENT KOVACIC: Yes.

PN2836

VICE PRESIDENT HATCHER: That's AWU work isn't it?

PN2837

MR MAXWELL: Yes. Well, not all of it, your Honour.

PN2838

VICE PRESIDENT HATCHER: So that's three scenarios and then there's - you can have and not have underground allowance. You can have an underground allowance and a tool allowance.

PN2839

MR MAXWELL: Your Honour, perhaps if I can - just to put it in some context.

PN2840

VICE PRESIDENT HATCHER: I think you're up to four scenarios now.

PN2841

MR MAXWELL: About the allowances, and just hand up an extract from the National Building and Construction Industry Award 2000, to explain what used to happen prior to the making of the modern award, which may help explain how the issue arose. Unfortunately I've neglected to send a copy to Melbourne for Roe C, but I just wish to hand up copies of this extract.

PN2842

VICE PRESIDENT HATCHER: I'm sure he's got it out anyway.

PN2843

MR MAXWELL: Your Honours and Commissioner, this document is an extract from clause 18 from the National Building and Construction Industry Award 2000. In 18.1.2 they actually set out what were the hourly rate applicable under the award for the classifications, and these were calculated dependent on whether the employees were weekly hire or daily hire. So the - for example, the carpenter-diver was a tradesperson so they were daily hire. The - over the page, the operator group H, they were an operator so they were weekly hire. So when you look at the explanation in the opening paragraph it says that:

PN2844

The following hourly rates have been calculated in accordance with 18.3 of this award. These rates include industry allowance, tool allowance, the respective special allowance and the allowances in 18.5 and 18.14.

PN2845

The only ones that the rates didn't include were entitled plant allowance. That is an all-purpose allowance but it wasn't included in those tables because it was so very few and far between that it would actually apply.

PN2846

VICE PRESIDENT HATCHER: Was there a leading hand allowance as well?

PN2847

MR MAXWELL: The leading hand allowances are not in those but the leading hand allowance was paid for all-purpose. So you would add the relevant leading hand hourly rate to those. When you then - - -

PN2848

VICE PRESIDENT HATCHER: If you're a tradesperson does a tool allowance necessarily apply or is there an option not to provide tools and - - -

PN2849

MR MAXWELL: The only option to provide tools - sorry. The tool allowance is all-purpose and paid to everyone under this award. So for a carpenter or an apprentice, they receive the tool allowance.

PN2850

VICE PRESIDENT HATCHER: So the employer can't say I'm going to provide the tools and not pay the allowance?

PN2851

MR MAXWELL: Not under this award, no. Now the hourly rates that are set out in that clause, under the old NBCIA, you applied the 25 per cent to those rates. So it was quite clear under that award what the casual rates of pay would be. So for example if you were a signwriter which was a CW4 the hourly rates under the award were 17.21, you would then add on 25 per cent for a casual signwriter.

PN2852

VICE PRESIDENT HATCHER: So those hourly rates didn't include the follow the job allowance.

PN2853

MR MAXWELL: For the tradesperson and labourers yes, they did.

PN2854

VICE PRESIDENT HATCHER: They did.

PN2855

MR MAXWELL: Because if you go to 18.3, where it's got the hourly rate calculation, so for tradespersons and labourers it includes the follow the job calculation and that sets out how - - -

PN2856

VICE PRESIDENT HATCHER: Just slow down, 18.3, yes.

PN2857

MR MAXWELL: So you've got the hourly rate calculation and it's for two different types of employees. There's the tradespersons and labourers, which were daily hire, and therefore you included the follow the job loading. For the operators which were weekly hire, you didn't include the follow the job loading. So under the pre-reform award it was actually quite simple to work out what you apply the casual loading to, it was just what was the hourly rate, depending on whether they were an operator or tradespersons and labourers.

PN2858

VICE PRESIDENT HATCHER: So under this award could you have a casual tradesperson or labourer?

PN2859

MR MAXWELL: Yes, you could.

PN2860

VICE PRESIDENT HATCHER: You could.

PN2861

MR MAXWELL: Yes.

PN2862

DEPUTY PRESIDENT KOVACIC: So if there is another allowance such as the in-charge plant allowance and that was say 50 cents in the hour, you would add 50 cents to the hourly rate and then apply the 25 per cent on top of it.

PN2863

MR MAXWELL: That's right. Just to confirm that, your Honour, I have the employment categories under the NBCIA 2000 Just to confirm that, your Honour, I have the employment categories under the NBCIA 2000. The extract shows a reference was clearly back to those hourly rates for calculation of the casual rates of pay. Your Honours and Commissioner, if you can turn to clause 13.4, which dealt with casual employment, and in 13.4.6 it states that:

PN2864

A casual employee for working ordinary time shall be paid 125 per cent of the hourly rate prescribed by clause 18.1.2 for the employee's classification.

PN2865

So clearly under the pre-modern award it was clear that the casual loadings applied to the rates specified in 18.1.2.

PN2866

VICE PRESIDENT HATCHER: I just might mark those, Mr Maxwell. So the National Building and Construction Industry Award 2000 extract clause 18 will be exhibit 307. The National building and Construction Industry Award 2000 extract clause 13 will be exhibit 308.

EXHIBIT #307 NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 EXTRACT CLAUSE 18

EXHIBIT #308 NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 EXTRACT CLAUSE 13

PN2867

MR MAXWELL: Your Honours and Commissioner, it was clear that under the modern award that the casual loading was paid on the rate inclusive of all-purpose allowances.

PN2868

VICE PRESIDENT HATCHER: Commercial construction, to what extent are casual used?

PN2869

MR MAXWELL: They are used by certain companies, for example, traffic control companies, you tend to find that the majority of their employees are casuals. In site cleaning you tend to find a high degree of casual employment. In form work there may be some but it's mainly daily hire.

PN2870

VICE PRESIDENT HATCHER: So in the areas where daily hire is significant there would be little or no casual employment?

PN2871

MR MAXWELL: No, there is casual employment. It just depends on the nature of the business and what work they do.

PN2872

VICE PRESIDENT HATCHER: To what extent is there weekly employment in commercial construction?

PN2873

MR MAXWELL: Very little. We would also dispute Ms Adler's assertion that weekly employment is the norm in the residential construction industry. In our experience the - I suppose the normal employment practice in that area is subcontracting.

PN2874

VICE PRESIDENT HATCHER: That's a non-employment practice but where they have employees - - -

PN2875

MR MAXWELL: Which is non-employment but where they have employees we - in our experience it varies but we would say that it would be mainly daily hire. I think it you look at the submissions of the AiG that's referred to in our submission in the previous matter and the submissions of the MBA, they say that for tradespersons and labourers the main form of engagement is daily hire.

PN2876

SENIOR DEPUTY PRESIDENT HAMBERGER: Would they be - do you still only get one day's notice? Is there an exemption with the NES?

PN2877

MR MAXWELL: There is. The exemption from the NES - sorry, under the NES provision is for daily hire employees. They're not entitled to the notice and they're not entitled to the redundancy provisions because they are covered by the industry specific redundancy scheme under the award.

PN2878

Your Honour, just to I suppose correct one other issue that's been raised. It's been suggested that any employees under this award can be engaged as daily hire. That's incorrect because the only employees that can be engaged as daily hire employees under this award are tradespersons and labourers, and that's found in clause 11 of the award. So you can't have a daily hire operator under this award.

PN2879

In regard to the issue of what you apply the 25 per cent loading to, the position of the HIA is that you only apply it to the minimum base rate and then you add on all the allowances after that. They rely on the - I suppose the first decision in the absorption case in July 2015. Clearly, in September - in the 1 September decision in 2015 the Full Bench made it quite clear that where an award included all-purpose allowances that that would form part of the ordinary time - well they used the term ordinary hourly rate and this is the ordinary hourly rate that you attach the casual loading to. That was I think the extract that your Honour took Ms Alder to in that decision.

PN2880

Your Honour also raised the issue about when the Full Bench raised the issue about parties being able to apply an award by award basis about what you apply the casual loading to. They said in that decision, which is in paragraph 109 and this I think is a concern that was raised by Ms Adler where they say:

PN2881

The concern which underlay the provisional decision was whether it was appropriate for certain allowances to (indistinct) all-purpose allowances to be paid at an increased level or casual employees by reason of the application of the casual loading. Ultimately, however, we have concluded that to deal with this concern in the manner proposed by the provision of the decision is too broad brush an approach and involves conducting the analysis from the wrong starting point. We consider that the preferable approach is to permit reconsideration on an award by award basis during the course of the four yearly review, as to whether any existing allowance should retain its all-purpose designation, or should be payable on some different basis.

PN2882

So we say that decision made it quite clear that if the allowance is considered to be all-purpose and part of the ordinary time hourly rate then you apply the casual loading to the total rate. Whereas what Ms Adler is seeking to do is to go back to the provisional view that was expressed when you only apply it to the base rates and then add on the allowances.

PN2883

Now we say there is good reason why you add the 25 per cent to the various allowances under the award, and I think if you just look to the basic issue of what the casual loading is to compensate for. So if you take the four weeks annual leave and if a carpenter has an all-purpose rate inclusive of the tool allowance, the industry allowance, the special allowance and the follow the job loading, and they went on four weeks leave, then they would be paid four weeks times that 38 hours by that ordinary time hourly rate and that will give you one amount.

PN2884

Now if the casual loading is to compensate the lack of four weeks annual leave then the casual loading has to take into account that those people receive those allowances during the period of annual leave, and that is why you apply the 25 per cent to the all-purpose rate. So that is why whilst Ms Adler and the HIA may not be happy with it, that is why the casuals get a loaded rate on top of the allowance. It is so the employee - the casual employee is compensated for missing out on those leave provisions that are applied to a non-casual employee.

PN2885

VICE PRESIDENT HATCHER: Following the job allowance is in a different category because it can't be described as an all-purpose allowance can it?

PN2886

MR MAXWELL: Well, we say it is and that's the way it's always been treated under the construction awards.

PN2887

VICE PRESIDENT HATCHER: Well, it's not all-purpose in the sense that it's an incident of a particular type of employment, that it was clearly not intended to apply to all employees under the award.

PN2888

MR MAXWELL: It was - well, it was intended to apply to all daily hire employees under the award and prior to the modern award that was tradespersons, labourers. So all tradespersons and labourers, it was all-purpose for all tradespersons and labourers under the award. It wasn't - - -

PN2889

SENIOR DEPUTY PRESIDENT HAMBERGER: What do you say to the argument that it's - if you get the casual loading on the follow the job loading, essentially it's being compensated twice for what's essentially the same disability?

PN2890

MR MAXWELL: We say it's not and we address that in our written submission because the casual loading is payable in lieu of the lack of paid leave, so annual leave, sick leave and so forth. There's a component for long service leave and a provision for notice, and if you go back to - - -

PN2891

VICE PRESIDENT HATCHER: Well, that's some of it but there's also an element, a well-recognised element for intermittency in employment. Part of which seems to be at least in-between projects is compensated for by the follow the job allowance in the case of daily hire.

PN2892

MR MAXWELL: Well, your Honours in our written submission we refer to the metal industry case where the Full Bench in that matter dealt with this issue about intermittence of employment, and those - this is on page 25 of our written submission starting in paragraph 48 we refer to the metals case and in particular in paragraph 187 they say that:

PN2893

Our consideration of the issues generated about the inclusion of a component for these considerations is guided by the emphasis we have given to the relationship, between the casual rate loading and the award based instance of the types of employment. The retention or inclusion of a factor to deter use of casual employment would be inconsistent with the rationale we have announced. The linkage between the award incidents of a type of employment and the itinerants of the casual work, or such notions as the incidence of casualness, an expression used in some of the Queensland decisions, is elusive. However, the itinerants is associated with the notions of intermittent work or lost time. Both may be portrayed as consequential to hourly hire, and to the employment by the hour instance of casual employment.

PN2894

In paragraph 188 they go on and I just refer you to the bit that's underlined at the end of paragraph 188 where they say:

PN2895

Although we are not attracted to making provision for itinerants or lost time as direct empowerments, we accept that evidence about them is relevant to assessing the appropriate rate to be given to a note of termination and the effect of employment by the out component of the loading.

PN2896

Now that was done in the context of the Metal Industry Award where it was weekly hire. What we say is this has to be seen in this award where you have weekly hire and daily hire. In daily hire they had a component of lost time, the time between projects. But when you look at what the casual loading is in lieu of in the - in clause 14.5 of the award it says that it's in lieu of - sorry, yes, in clause 14.5 in sits in lieu of it doesn't mention the follow the job.

PN2897

SENIOR DEPUTY PRESIDENT HAMBERGER: But you said that people on daily hire don't get notice, get one day's notice.

PN2898

MR MAXWELL: They get one day's notice.

PN2899

SENIOR DEPUTY PRESIDENT HAMBERGER: Notice is one of the things that the - the absence of notice is one of the things that the casual loading compensates for. What they seem to be saying here, what the Full Bench was saying was that well we're not going to have a separate amount 1.5 per cent or something for intermittent work but we're going to - in the way we kind of view the issue of notice, that the absence of notice, we're going to take that into account and the issue of the fact that you don't get notice. So ultimately the fact that the follow the job loading is marginally compensation for the fact that you don't get notice, combined with the fact that you might have extra days out of work. But those are already compensated for in the casual loading arguably. Well I think they are, I don't think it's that - - -

PN2900

MR MAXWELL: We don't accept that argument.

PN2901

SENIOR DEPUTY PRESIDENT HAMBERGER: No.

PN2902

MR MAXWELL: Because our position is that the daily hire employees are entitled to one day's notice, where the casual employees are entitled to one hour's notice.

PN2903

SENIOR DEPUTY PRESIDENT HAMBERGER: Right.

PN2904

MR MAXWELL: So there is a different level of the notice that applies.

PN2905

COMMISSIONER ROE: Mr Maxwell, can I just ask you this to assist me to understand. Is the implication of what the HIA and the MBA are arguing that a casual employee would not get the follow the job allowance at all, and then your position is not only should labourers and tradespeople get the follow - who are casuals get the follow the job allowance, but that the 25 per cent should apply to the rate including the follow the job allowance? So what I'm asking Mr Maxwell is are there two issues here or just one? Are there two issues and only one where the follow the job applies at all to casual employees, and then secondly the issue is it at all-purpose allowance and therefore the 25 per cent applies to it? Or is there just one question?

PN2906

VICE PRESIDENT HATCHER: You said it's an all-purpose allowance so presumably you'd say the loading then escalates the follow the job allowance as well.

PN2907

MR MAXWELL: Yes. But only for people engaged as tradespersons or labourers. Because - - -

PN2908

COMMISSIONER ROE: Am I right that your understanding of what the MBA and HIA are arguing for is that it just doesn't apply at all to casual employees?

PN2909

MR MAXWELL: That's my understanding, yes.

PN2910

COMMISSIONER ROE: Thank you.

PN2911

MR MAXWELL: We make the distinction between the follow the job loading applying to casuals as tradespersons and labourers because under the award operators can only be engaged as weekly hire. So an operator under weekly hire wouldn't receive the follow the job loading. The main essence we say is what the HIA and the MBA are - - -

PN2912

VICE PRESIDENT HATCHER: Sorry, a casual operator has a period of unemployment in-between projects doesn't get the loading but a tradesperson who has a period of unemployment, a casual tradesperson has a period of unemployed between two projects does get the loading.

PN2913

MR MAXWELL: Yes.

PN2914

VICE PRESIDENT HATCHER: What's the logic in that?

PN2915

MR MAXWELL: Well, the loading for the casual operator is two compensate them for the loss of what they would receive for annual leave, sick leave and the other components that the casual loading is paid for. So in terms of the operator the 25 per cent would meet those requirements so they're not disadvantaged. Whereas if it's a daily hire employee or the casual is performing the work that is not performed by a daily hire employee they are not being fully compensated for the loss of benefits.

PN2916

VICE PRESIDENT HATCHER: The problem is that the 25 per cent loading was calculated for not being a weekly hire employee.

PN2917

MR MAXWELL: That's right.

PN2918

VICE PRESIDENT HATCHER: It was not calculated for not being a daily hire employee. For example, if one was to compare the disadvantages of a casual compared to a daily hire employee, then one might re-assess the amount of the casual loading on a completely different basis because the disabilities are far less when you do the comparison. You seem to be taking - plucking the 25 per cent which was a calculation done by reference to weekly hire employees and then adding something pulled from daily hire employees and combining the two.

PN2919

MR MAXWELL: Well, your Honour, to put this in some historical context. When the casual - because just to go back briefly. Under the old awards or the National Building and Construction Industry Award 2000, a casual tradesperson and labourer was someone engaged for less than five days. So as soon as they were employed for longer than four days they became a daily hire employee and picked up all the benefits of the award.

PN2920

In 2002, I think it was, when we increased the casual loading under the NBCIA from 20 per cent to 25 per cent, a consent position was reached because we argued that tradespersons and labourers because they were daily hire should receive a higher casual loading than the 25 per cent that was supplied to weekly hire. We reached a consent position where we would have the one loading of 25 per cent and apply it to all employees covered by the award. But it was easy under that award because we then applied it to whatever the hourly rate was, based on the calculation of whether you're daily hire or weekly hire. The position's been complicated by the making of the modern award where the Full Bench of the Industrial Relations Commission decided to extend the weekly hire engagement to tradespersons and labourers.

PN2921

Your Honours and Commissioner, our main concern in regard to this is that if we adopted the position of the MBA, that that would reduce the rates for casual employees under the award and we set out what those amounts are in Attachment 2 to our written submission. If we adopted the far more radical HIA approach then the reduction in earnings of casual employees would be significantly less, and that's set out in Attachment 1 to our written submission.

PN2922

VICE PRESIDENT HATCHER: Whether there's a reduction depends upon how you interpret the current award doesn't it? That is if we interpret it in a different way from what you propose then perhaps there's no reduction.

PN2923

MR MAXWELL: Well, your Honour, we say the modern award is clear about what is included in the ordinary hourly rates under the award. There are definitions in clause 3 which were agreed to as part of the 2012 award review, and which were put in to clarify that the daily hire employees use the calculation in 19.3(a), and for weekly hire employees you use the calculation in 19.3(b). If they're a foreperson you add - - -

PN2924

VICE PRESIDENT HATCHER: Well, you don't have to speak on - again particularly focusing on follow the job allowance. That is in that respect, your submission that it would lead to reduction is founded upon the proposition that the award currently is clear and casual rates do include that loading, but that's far from clear isn't it?

PN2925

SENIOR DEPUTY PRESIDENT HAMBERGER: I think you admitted at the beginning it wasn't clear, that was the issue that needed to be resolved.

PN2926

MR MAXWELL: Well, we admit it wasn't clear but even if you adopted the - well, in regard to the HIA's position, whether you include the follow the job loading or not, the reductions that would apply would apply across the board. Just on the issue that I did refer you to the decision of the Full Bench in the absorption case, I will just seek to also refer you to a decision that was handed down after the HIA lodged their submission but which is relevant to the four yearly review. I know that your Honour - sorry three members of the Bench were on the same Full Bench so you may be already aware of the decision.

PN2927

VICE PRESIDENT HATCHER: Thank you.

PN2928

MR MAXWELL: I apologise to Roe C in Melbourne, but this is the decision found in [2015] FWCFB 7236. It dealt with the exposure drafts from group 1C, 1D and 1E awards as part of the four yearly review, but the particular reference I want to take you to is in regard to the discussion in regard the Hydrocarbons Industry (Upstream) Award. This is found in paragraphs 57, where they dealt with the calculation of the casual loading.

PN2929

In that award they were considering the issue about whether they should apply the casual loading to the ordinary hourly rate and in paragraph 58 they refer to paragraphs 109 and 110 of the September 2015 decision, and in - - -

PN2930

VICE PRESIDENT HATCHER: So this is just a straight out application of that decision, is it?

PN2931

MR MAXWELL: That's right. What they said in that decision was that no party contended that the all-purpose character of the industry allowance or the licence allowance should be revisited. So accordingly the casual loading will be based on your hourly rate. So they clearly re-affirmed that the approach taken by the Full Bench in the award review to date has been that if the allowances are included in the all-purpose rate, then you apply the casual loading to that rate.

PN2932

So your Honours, I think I've really taken you through emotive issues. I mean the bottom line is we say that we - our position is really summarised - our final position is summarised in paragraph 57, where we say neither the MBA or HIA have provided any evidence of any substantial change that has occurred since the modern award review 2012, nor the award modernisation process, nor any other probative evidence to justify those variations to the award.

PN2933

We say they've not provided any cogent reasons as to why the casual rates of pay payable under the Building and Construction General On-site Award should be significantly reduced, and we submit that on the authority the modern awards review 2012 decision of Watson SDP, the absorption decision and the casual loading decision - sorry, the absorption and casual loading decision and the preliminary jurisdictional decision, the MBA and HIA application should be rejected and the casual loading should continue to be applied to the daily hire ordinary time hourly rate for CW Building and Construction labours and tradespersons.

PN2934

VICE PRESIDENT HATCHER: Thank you.

PN2935

MR MAXWELL: Thank you, your Honour.

PN2936

VICE PRESIDENT HATCHER: Anything briefly in reply, noting we've got another matter to turn to yet?

PN2937

MS ADLER: Just a couple of matters, your Honour. I'll be brief. First of all just going to your question to Mr Maxwell around the schedule. There are five different type of tool allowances in different amounts, so - - -

PN2938

VICE PRESIDENT HATCHER: But can you get more than one at the same time?

PN2939

MS ADLER: You can't get more than one at the same time but if different trades have different sorts of allowances.

PN2940

VICE PRESIDENT HATCHER: So the different sorts of classifications will only have one particular allowance. We'd have a schedule with the allowance applicable to that particular classification.

PN2941

MS ADLER: By trade, yes, you would. I think the exhibits handed up by Mr Maxwell going through the provisions of the national award again demonstrate how difficult it is on the face of the current award to actually work out the amount to the rate of pay, and when you have to go back to the provisions of the national award, which required respondents to that award, so it didn't necessarily apply to everyone, particularly in the residential construction industry. I think that demonstrates the issue that this award on its face is not easy to understand, you can't work out the casual rate of pay just by picking it up and you need to understand how the national award worked that's no longer - doesn't any longer operate or doesn't any longer apply.

PN2942

Just to address a point of clarification that Roe C raised. Our variation would say that the follow the job loading doesn't apply to casuals at all. So it's not a matter of whether it's all-purpose or not, we just say it shouldn't apply full stop. That's all I have, your Honours. Thank you.

PN2943

VICE PRESIDENT HATCHER: Ms Sostarko, anything in reply?

PN2944

MS SOSTARKO: Thank you, your Honour. Just three points that I wanted to briefly make, mostly that as you can see the history is obviously relevant in terms of how we understand how we got to this point. I think that Mr Maxwell is suggesting that that should be the authority for going forward on this issue and we'd certainly firmed disagree with that point on the basis that what has significantly changed is at that time in NBCIA 2000, daily hire was the only way that tradespeople and labourers could be engaged, and that's no longer the case.

PN2945

Secondly, Mr Maxwell made a comment just before that only tradespeople and labourers could be appointed as daily hire. I was hoping to bring to the attention - the Bench's attention to an exhibit that was tendered by the CFMEU in August 2015 and it's annexed to our February 2016 submissions at Attachment D. Now what it is, this document actually is one that the CFMEU has put together and if - you require copies? Do you have that handy because I do have copies of that.

PN2946

VICE PRESIDENT HATCHER: This is the 26 February 2016 submissions?

PN2947

MS SOSTARKO: Correct.

PN2948

VICE PRESIDENT HATCHER: What annexure was it?

PN2949

MS SOSTARKO: It was at Annexure D and it's entitled "Casual rates calculations, Building and Construction General On-site Award 2010". I do have copies if that assists.

PN2950

VICE PRESIDENT HATCHER: No, we have that.

PN2951

MS SOSTARKO: My understanding is that the purpose of this document was on the CFMEU's part, was to demonstrate that in the event that our determination was issued that the effect would be that the workers on the left-hand side, the classifications of work, would receive a reduction in their pays. On that - - -

PN2952

VICE PRESIDENT HATCHER: Does this model your proposal or the HIA proposal?

PN2953

MS SOSTARKO: This is a document that was tendered by the CFMEU not ourselves.

PN2954

VICE PRESIDENT HATCHER: I understand that but whose proposal was it - it's modelling somebody's proposal.

PN2955

MS SOSTARKO: My understanding is that the purpose of this is to say that if the base rate is not calculated in accordance with the daily hire rate, the reduction is reflected on the second last column which supposedly shows a reduction in hourly rates. The point I'm trying to make here, and I'll get to it very quickly, which is that it's reflected that each individual categorisation of worker would receive a reduction.

PN2956

Now that could only occur if the follow the job loading was applied to all of these different classifications of workers. You can clearly see that operators for example are included in that, but Mr Maxwell has just denied that in fact that operators would be entitled to that loading under the current award. So I'm just a little confused as to - I think that this document contradicts what Mr Maxwell said as far as who is and isn't eligible for follow the job loading under the on-site award.

PN2957

VICE PRESIDENT HATCHER: Even where it is a tradesperson, for example, how can it lead to these sort of reductions?

PN2958

MS SOSTARKO: This is - again, this is a document that they've drafted but I - the point being that it infers that more than just tradespeople and labourers would be affected if our determination was accepted.

PN2959

VICE PRESIDENT HATCHER: That's right.

PN2960

MS SOSTARKO: I'll just quickly - I'm sure Mr Maxwell would like to say something about that but I'll just quickly say that - and thirdly, no, the issue as far as the definition isn't agreed, I'll reiterate that in 2012 in that decision, consideration of this issue wasn't fully ventilated, so no, I would disagree that the matter has been agreed to by consent. Thank you, that's all. Thank you, your Honour.

PN2961

VICE PRESIDENT HATCHER: Thank you. Mr Maxwell, whose proposal is that modelling?

PN2962

MR MAXWELL: Your Honour, that was based on the provisional view of the Full Bench in the absorption case. So it's based on - the calculations were based if you only apply the 25 per cent loading to the minimum rate and then added the allowances on top. That is the purpose of that model. That model did take into account the difference between operators and tradespersons and labourers.

PN2963

VICE PRESIDENT HATCHER: Does it take into account the loss of the follow the job allowance?

PN2964

SENIOR DEPUTY PRESIDENT HAMBERGER: Only the follow the job loading. There's other - - -

PN2965

MR MAXWELL: That takes into account not only the loss of the follow the job loading but also not applying the 25 per cent loading to the all-purpose rate.

PN2966

VICE PRESIDENT HATCHER: So effectively it's modelling the HIA's proposal is it?

PN2967

MR MAXWELL: That's the HIA proposal.

PN2968

SENIOR DEPUTY PRESIDENT HAMBERGER: It was the Commission's proposal.

PN2969

MR MAXWELL: Your Honour, if you look at our written submission which perhaps it may be beneficial for the MBA to actually read, if you look at Appendix 1 we say that reflects the rates that the MBA attached to their submission, but we also included Attachment 2 to our written submission. Which sets out the actual differences in the rates that would apply and it is clear under that that we say in regard to the operators because they didn't receive a follow the job, there would no loss. That's reflected in that table. The only people that would lose would be tradespersons and labourers.

PN2970

VICE PRESIDENT HATCHER: Right, well we thank the parties for their submissions. We'll reserve our decision about this matter. The parties are now excused from further attendance. Is the only matter remaining the issue of the Recruitment and Consulting Associations statement?

PN2971

MR FLEMING: Your Honour, there's one more issue if I may.

PN2972

VICE PRESIDENT HATCHER: Mr Fleming.

PN2973

MR FLEMING: The witness Jack Todaro is waiting ready to give evidence. We've received no objection to him being heard today and Wednesday afternoons are the only time he's available. Unfortunately he now works full-time.

PN2974

VICE PRESIDENT HATCHER: We had better deal with that first, I think. Sorry, Mr Gee.

PN2975

MR FLEMING: I call Jack Todaro.

PN2976

VICE PRESIDENT HATCHER: Mr Arndt.

PN2977

MR ARNDT: Short of being as absolutely quick as I can be, can you give me any direction as to the time limits on - do we finish hard at five?

PN2978

VICE PRESIDENT HATCHER: No.

PN2979

THE ASSOCIATE: Are there you there, Mr Todaro?

PN2980

MR TODARO: Hi there.

PN2981

THE ASSOCIATE: Hi, it's (indistinct) from the Fair Work Commission, how are you?

PN2982

MR TODARO: Good thanks, how are you?

PN2983

THE ASSOCIATE: I'm good, thank you. I am calling from the court room in relation to the Casual and Part-Time Award Modernisation Full Bench. Are you ready to give your witness evidence?

PN2984

MR TODARO: Yes, I am.

PN2985

THE ASSOCIATE: Have you got a copy of your statement there with you?

PN2986

MR TODARO: I do. If you'd just give me a moment, I'll get it in front of me. I'm ready to go.

PN2987

THE ASSOCIATE: I'm just going to administer the affirmation and then you'll be asked to give your evidence.

<JACK TODARO, AFFIRMED [4.49 PM]

EXAMINATION-IN-CHIEF BY MR FLEMING [4.49 PM]

PN2988

VICE PRESIDENT HATCHER: Mr Fleming.

PN2989

MR FLEMING: Mr Todaro, my name is James Fleming. I appear on behalf of the Australian Council of Trade Union. You're just going to be asked some questions about your statement. Could you please confirm your full name and address for the Commission?‑‑‑Yes, my full name is Jack Todaro, (address supplied).

*** JACK TODARO XN MR FLEMING

PN2990

Thank you. Can I just check the statement you have in front of you is 21 paragraphs and is signed by you and undated?‑‑‑That is correct.

PN2991

I understand you have a number of corrections to make and an update to your circumstances. I'll try and proceed expeditiously, your Honour. So the spelling of your name in the first line is T-o-d-a-r-o, is that correct?‑‑‑That's right.

PN2992

You wish to delete paragraph 10 of your statement?‑‑‑Yes, I would like to delete that.

PN2993

Which talks about rostering arrangements?‑‑‑Yes.

PN2994

Could you explain what the rostering arrangements were during your casual employment?‑‑‑Yes. On the whole across my three years of casual employment I generally did receive rosters. At my last employment at Town and Country I did not receive rosters at all. It was more of getting told the week before or getting told during the week or the day before if I could come in. So I wanted to delete that paragraph simply because it was more of a mixed back than just never getting rosters. Sometimes I did, often they changed and sometimes I didn't get them at all.

PN2995

Thank you. Paragraph 17, you wish to insert the word "pay" before "rent"?‑‑‑Yes.

PN2996

I understand there's been a change to your circumstances. Where are you working now?‑‑‑I'm currently working in the construction industry, no longer in hospitality.

PN2997

What's your position?‑‑‑I'm an apprentice systems electrician.

PN2998

Is that full-time or casual?‑‑‑That's full-time work.

PN2999

You're no longer studying or what are you studying now? You're no longer studying International Studies at RMIT?‑‑‑That's correct. I'm no longer studying international studies. As part of my apprenticeship I am undertaking a Certificate III in Electro technology at NECA Apprenticeships and Careers.

*** JACK TODARO XN MR FLEMING

PN3000

If I could just summarise these uncontroversial background facts and let me know if this correct. You unenrolled from your international studies at RMIT at the end of 2015, you subsequently commenced Certificate II in electro technology at RMIT TAFE, and around the time that you completed that in April 2016, you commenced your apprenticeship. Can I just confirm, what was the award that applied to your employment whilst you were engaged in hospitality at the establishments that you mentioned?‑‑‑To the best of my knowledge, the award that I was employed under was the Restaurant Industry Award of 2010, at least technically I was supposed to be covered by that award.

PN3001

I take it you're no longer a member of United Voice?‑‑‑That's correct, simply because I'm not longer in the industry.

PN3002

That paragraphs 10 onwards about the impact of casual work under that heading all relate to the casual work mentioned above that you're no longer engaged in. Is that correct?‑‑‑That's correct.

PN3003

Having made those corrects and taking that update into account, do you attest that your statement is true and correct?‑‑‑I do.

PN3004

I tender that document, your Honour.

PN3005

VICE PRESIDENT HATCHER: The statement of Jack Todaro undated will be marked exhibit 309.

EXHIBIT #309 WITNESS STATEMENT OF JACK TORADO, UNDATED

PN3006

Mr Arndt.

CROSS-EXAMINATION BY MR ARNDT [4.53 PM]

PN3007

MR ARNDT: Mr Todaro, can you hear me?‑‑‑Yes, I can.

PN3008

Mr Todaro, my name is Julian Arndt, I work for or I represent a number of employer parties in these proceedings, and the parties I represent are opposing the ACTU claim. I want to ask you a few questions about your statement today. I understand that your circumstances have changed somewhat. Really because of the nature of this case I want to focus on your casual employment in what you term in the hospitality industry, but I believe it was actually under the Restaurant Award, and perhaps a bit about your university time. Mr Todaro, to start off with I'm going to make an assumption, you finished Year 12 at high school didn't you?‑‑‑That's correct, I did.

PN3009

What year did you finish high school?‑‑‑I completed my VCE in 2012.

*** JACK TODARO XXN MR ARNDT

PN3010

Where did you attend high school, what school?‑‑‑
Xavier College, in Kew.

PN3011

Did you go straight to university after finishing Year 12?‑‑‑I did. I began a computer science degree at the start of 2013 at RMIT University.

PN3012

Why did you choose to start computer science?‑‑‑It was always a hobby of mine for quite a while actually, I think as young as 12 I always enjoyed tinkering with computers and programming. I thought it could be a field that I might enjoy and so I picked that degree so I could have some qualifications behind me and hopefully get a job in that field.

PN3013

But you didn't complete the course?‑‑‑I did not.

PN3014

From what I understand you then start - is it International Studies?‑‑‑That's correct.

PN3015

Why did you choose that course?‑‑‑I became disillusioned with the idea of doing IT work as a job, that's why I dropped off from computer science in 2013. I gained an interest in - well, I'd always also had an interest in history and politics, so I wanted to give International Studies a go, to see if it was right for me, to see what sort of fields or careers it could lead to and thus I began those studies at the beginning of 2014.

PN3016

Was that the type of course in which you're required to study or work overseas at some point or learn a language? Is that one of those courses?‑‑‑Correct. I was required to learn a couple of languages. I believe there's also opportunities to study overseas however I never did this.

PN3017

When you were at uni, did you live at home with family or did you live independently and by yourself or with friends?‑‑‑I lived with my family at home.

PN3018

If we could go now with your work history I want to take you to paragraph 6 of your statement?‑‑‑I beg your pardon, which paragraph was that?

PN3019

Paragraph 6?‑‑‑Thank you.

*** JACK TODARO XXN MR ARNDT

PN3020

When you say you worked in the hospitality history since August 2013, and sorry to labour the point, your understanding and I believe your advice is that you worked under the Restaurant Award?‑‑‑Yes, yes, I was advised that I was working under the Restaurant Industry Award.

PN3021

Can you go to 7 of your statement. You worked at the Snow Pony Café as a casual from August 2013 to January 2014?‑‑‑Yes.

PN3022

That's about six months is it?‑‑‑I apologise, I failed to notice that I actually worked longer at the Snow Pony Café, until September 2014. I apologise for that omission.

PN3023

No, that's all right, that's fine. During that period and while you're at the Snow Pony Café, did you work set hours?‑‑‑At times. We did receive a roster at Snow Pony, it was a weekly roster. At times we'd have a couple of rosters in advance. At the same time we also would be called up especially when things were busy, if we could come into work or if we could stay longer past our finish time which was specified on the roster, and also at times if it was slow we would be sent home early.

PN3024

Mr Todaro, I'm not so much asking you whether you had a roster in terms of set hours, I might have been a bit confusing in my phrasing. I'm asking did you have set hours and did you work the same hours pretty much every week?‑‑‑More or less, yes. Some weeks I'd work perhaps one day more, other weeks I'd work maybe one day less. If that's what you're referring to.

PN3025

The same amount of hours week to week?‑‑‑Not necessarily. There were definitely times where I would work the same hours week to week but I wouldn't say that that was consistent by any means because hours did actually change.

PN3026

It certainly wasn't on a set pattern or basically - - -?‑‑‑That's correct.

PN3027

- - - if you did work the same hours it would be more by accident rather than any design?‑‑‑That's right. I mean the variations we're talking about, I was still always almost exclusively working between Friday and Sunday every week. The variation would be a few hours here or there, but yes I can say that it wasn't the exact hours and the exact days every single week.

*** JACK TODARO XXN MR ARNDT

PN3028

Why did you seek employment as a casual at the cafe?‑‑‑I hadn't really had a proper job before. I'd worked as a shop assistant earlier on in 2011. My dad thought it'd be a good idea if I got job and I think he was right, it was good experience for me but I also wanted to put some money away as well and so I thought I'd seek employment as many do, to my understanding, in hospitality and I was able to gain employment Snow Pony Café which was also close to my residence, which was quite convenient for me.

PN3029

The hours of work there, did they agree with your university schedule?‑‑‑Yes, again because I was most working on weekends, so it didn't clash with class time.

PN3030

Can I take you to paragraph 8 of your statement?‑‑‑Yes.

PN3031

It says:

PN3032

Since January 2014 I had worked as a casual at Humburger.

PN3033

The internet tells me that Humburger's a retro venue with exposed brick walls, dishing up gourmet burgers and fries plus shakes and sundaes?‑‑‑Yes, that's right.

PN3034

That means it's a burger restaurant. Am I right?‑‑‑Yes, it is a burger restaurant.

PN3035

Why did you seek employment as a casual at Humburger?‑‑‑Humburger is owned by the same person that also owned Snow Pony at the time, and so he was looking to get some of his staff from Snow Pony over to Humburger as well to help get it going. So he took me on as a supervisor at Humburger in January 2014.

PN3036

Are you still in this employment? No, I'm guessing?‑‑‑I'm not longer in this employment.

PN3037

Why did you finish that employment?‑‑‑Through a number of circumstances my hours were reduced such that I couldn't actually sustain myself if I just worked as Humburger. This is part of the reason why I sought employment elsewhere and eventually found employment at Town and Country. But due to the way the two rosters meshed together, it meant that to continue employment at Humburger I would be working double shifts on Saturdays and Sundays and it was too much for me fatigue wise and so I left the employment of Humburger.

PN3038

Can I assume then that your hours at Humburger and your rosters at Humburger weren't set and regular? They varied a bit?‑‑‑They - yes, they did vary. Again, similar to Snow Pony, there were times where I would I know that I would have three or four shifts regularly every week, then there were times where my hours would be cut back severely such as in the situation where I was forced to seek other employment.

*** JACK TODARO XXN MR ARNDT

PN3039

Can we go to paragraph 9. When you wrote this statement you'd been employed at Town and Country Café as a casual for the last month. Are you still employed there?‑‑‑No, I apologise, I'm not longer employed at Town and Country Café. I terminated my employment there in May of this year.

PN3040

Why did you take that role?‑‑‑Why did I take a role at Town and Country?

PN3041

Yes?‑‑‑It was because I couldn't get enough hours at Humburger. I had been looking on job seeking websites on-line and I found that this café also close to my house at the time had an opening for a barista, I had some experience as a barista. I took the employment because the times that they needed work was on the weekends and so I could deal with that, and the hourly rate they were offering while it was below the award on the weekend, it was higher than what I believed I would get a many other restaurants if I applied elsewhere. So I took the employment at Town and Country for those reasons.

PN3042

You mentioned the suitability or the desirability of working on the weekend. Am I to understand that that's because you were studying during the week?‑‑‑Let's see. Yes, so by that time I was still studying International Studies, working on the weekends would leave my week open to dedicate time to not only going to class but I could put time aside to stay at uni and do some study or put time aside for myself to do study as well. So the weekends were just a block, I guess, that I could work effectively. But it was more than that. They also said in my interview before I even said the hours or days that I could work, we need people between Thursday and Sunday, and so I was employed from Friday to Sunday. So because of the situation of me being a student and Saturdays and Sundays being quite busy times yes, the situations met up and I was able to get employment there.

PN3043

So you understood going into that job that you'd worked basically on the weekends, and that suited you?‑‑‑Sorry, could you repeat that?

PN3044

Sorry. You understood accepting that job that you were going to be required to work on the weekends and that suited your circumstances, more or less?‑‑‑Yes. Suited my circumstances, yes. That's one way of putting it. I'd more put it as I didn't really have another option because I was still studying. Obviously I would far prefer to have my weekends free, you know, so I could actually go to family events. I missed many family events, as an example, because many of them still do take place on a weekend, but at the end of the day it was the only time that I could work because of the university schedule.

*** JACK TODARO XXN MR ARNDT

PN3045

Now I think in introducing your statement Mr Fleming or you rather said that at Town and Country - did you have a roster at Town and Country and did you work regular days or was it irregular work?‑‑‑Most of the work's regular days. Hours changed depending on how long they needed you for the day, but I never received a roster. I was either told the week before or many times I was sent a text message in the morning whether or not I was coming in and so no, there was no roster, definitely not a roster that was essentially accessible but not even a roster that was sent to tell me when I was or wasn't working.

PN3046

But I'm going to presume that you provided your availabilities and your unavailabilities to your employer and I'm guessing they probably reflected your university timetable?‑‑‑Yes, they had a number of university students working for them and they also knew I was studying at university, and so they knew that the main times that I were available - that I was available, pardon me, was on the weekends. I was able to do odd shifts during the week, however that I was irregular. The time that I was definitely available as in away from university was always the weekend.

PN3047

If you can go to paragraph 11 you say:

PN3048

It's been extremely hard to plan my life around my work because of the uncertainty of when I get shifts.

PN3049

I assume this is - what you're referring to there is the variability in your working patterns mean that your hours changed and you didn't know when you would be working?‑‑‑To some degree but I do believe there is more to that.

PN3050

Do you want to elaborate?‑‑‑Yes, if I may. As I mentioned, while I would have particular blocks of time where I would have a somewhat regular roster, that would come to an end at times. As an example, at Humburger I got reduced from four shifts eventually down to one shift. It didn't need to be justified for any reason because I was casual but it did make a significant blow in whatever medium or long term plans I had for myself. One of the main ones was I wanted to move out of home for a number of reasons, it wasn't just curiosity, there was an element of necessity in that. I didn't have the best relationship with my family and so I did want to get out of the house. But I couldn't do that or I didn't want to take that risk if I didn't have the guaranteed income. I didn't want to get locked into a 12 month contract, lose my job or lost enough hours and shifts and then be kicked out effectively. So on a week to week basis at particular times there was definitely some regularity but that couldn't be guaranteed long term enough for me to plan more long term things in my life.

*** JACK TODARO XXN MR ARNDT

PN3051

At 12 of your statement, paragraph 12, you say since you've been working in hospitality you've been unable to go to family events or make time to go and see friends. I assume that's for the same reason, as you found it hard to plan your life, you didn't know when you were working and your working times varied from week to week?‑‑‑That's correct, and if I may - if I may elaborate slightly further than that. It was also a case of not wanting to appear to my employer as being unreliable or being unavailable for the shift, so it was a combination of both wanting to get as many shifts as I could because I never knew when the work would dry up, to put it one way. But also not wanting to refuse work for the sake of appearing to the boss that I was no longer a reliable employee and given that I was a casual, they could quite easily get rid of me as I understood, and replace me with someone else that appeared more stable and reliable. If that makes sense to you.

PN3052

It does. Out of interest, had you ever seen that occur in any of the places that you worked? Someone being gotten rid of?‑‑‑Yes, yes, yes, people were gotten rid of in the places that I worked at. At Humburger there was quite a turn of people, same as at Snow Pony. By the end of my employment there almost everyone I had begun working with had gone for a number of reasons. People not being able to go on particular shifts, the manager would find someone else that was more regular and that person would no longer receive shifts, as one example.

PN3053

Can we go to 13 of your statement?‑‑‑Yes.

PN3054

You say in the summer holidays of 2014/15 you were unable to go and spend time with your family and friends, because you didn't have income coming in. If we could just pause there and then we can also go to paragraph 19 of your statement:

PN3055

Usually if I am sick or need time off I swap with other workmates, but if I cannot I have to take time off without being paid.

PN3056

Do you understand that you get a casual loading to work as a casual when you worked in these roles?‑‑‑I understand that technically I'm supposed to have received a casual loading. I can say that in none of the workplaces that I did work at was the award adhered to. The only time the award was adhered to was at Humburger when I was required to call the Fair Work Ombudsman regarding my pay. So I didn't receive a casual loading or penalty rates at any of my workplaces outside of this time.

PN3057

Mr Todaro, as someone who appears to be quite aware of industrial law and industrial rights, do you understand what a casual loading - - -

PN3058

VICE PRESIDENT HATCHER: Sorry, what was the basis of that proposition?

*** JACK TODARO XXN MR ARNDT

PN3059

MR ARNDT: That he - - -?‑‑‑I'm sorry, I missed the last of that.

PN3060

Sorry, Mr Todaro, just one - - -

PN3061

VICE PRESIDENT HATCHER: Mr Arndt, I think if you're going to raise that issue, put it to him that he is aware or he is not aware before you use that as a premise for a question.

PN3062

MR ARNDT: Mr - - -?‑‑‑I apologise, I can't hear who's speaking right now.

PN3063

Mr Todaro, I withdraw the question. Can I ask you whether - can I ask you what you understand a casual loading is for?‑‑‑As far as I understand a casual loading ostensibly is there to compensate for the lack of leave and other entitlements which would otherwise be awarded to permanent full-time or part-time employees.

PN3064

VICE PRESIDENT HATCHER: I'll cop the premise now, Mr Arndt.

PN3065

MR ARNDT: Mr Todaro, if I could try and sum up your evidence. It seems you have a preference against casual work, is that correct?‑‑‑I do.

PN3066

During your university time, did you make any applications for permanent roles?‑‑‑I did. While I worked at Humburger, I approached my employer at least twice in a serious manner requesting that I be converted to a permanent part-time position.

PN3067

Do you understand why you were unsuccessful in that application?‑‑‑I don't understand the exact intentions of my employer. My employer told me that it would cost him the same amount either way and so he wasn't interested in making me a permanent part-time, but yes, as I said I'm unaware of the exact intention.

PN3068

Mr Todaro, just one last question. You've started a - can you remind me what the apprenticeship that you have commenced is?‑‑‑Yes, it's an electrical apprenticeship. I'm studying to become an electrician.

PN3069

Was there an application process to secure that apprenticeship? Did you have to make an application - - -?‑‑‑The application process - - -

*** JACK TODARO XXN MR ARNDT

PN3070

Sorry, Mr Todaro, you go on?‑‑‑The application process is effectively trying to find an employer that will take you on as an apprentice. From there a training contract needs to be signed between three parties and an apprenticeship may commence from thereon in.

PN3071

Did you submit an application or a resume to get your place in the apprenticeship?‑‑‑I did.

PN3072

Were any of the roles that are named in your statement listed on that application or resume?‑‑‑Yes, all of them were.

PN3073

No further questions, your Honour. Thank you, Mr Todaro.

PN3074

VICE PRESIDENT HATCHER: Any re-examination, Mr Fleming?

RE-EXAMINATION BY MR FLEMING [5.13 PM]

PN3075

MR FLEMING: Just briefly, your Honour. Mr Todaro, you were asked by my friend whether you had a prejudice against casual work and you said you did. Why?‑‑‑The why is simply because casual work to me is a complete instability. It means that it leaves me with absolutely time or stability to plan my life outside of work. As I mentioned earlier, if I don't know if I'm going to have work the next week or not, I don't know what I can plan for longer term. I don't know if I can comfortably refuse shifts and know that my employment will still be safe, as opposed to sort of flagging myself as someone who might be unreliable. As a casual, it just means that I don't have the stability that to me seems to be awarded to permanent workers, and because of that it also meant that the particular breaches of the award which I discovered in my time in hospitality, it meant that it was quite a daunting path to tackle those issues out of fear that I could just lose my job with absolutely no protection or ability to challenge that. And so that's why I have a prejudice against casual work because it doesn't allow me to move on with my life, it keeps me in the same place. It puts great risk in planning anything long term.

PN3076

Thank you, no further questions.

PN3077

VICE PRESIDENT HATCHER: Thank you for your evidence, Mr Todaro, you're excused, which means you can simply hang up the phone?‑‑‑Thank you very much.

PN3078

Thank you.

<THE WITNESS WITHDREW [5.15 PM]

*** JACK TODARO RXN MR FLEMING

PN3079

Mr Gee.

PN3080

MR GEE: Thank you, your Honours, Commissioner, one last and very brief matter.

PN3081

VICE PRESIDENT HATCHER: You want to tender the statement of Ms Evans, is that right?

PN3082

MR GEE: Yes, your Honour. I have copies here if convenient. I know that the document's available on the web.

PN3083

VICE PRESIDENT HATCHER: Mr Fleming, you object to the admission of the statement?

PN3084

MR FLEMING: Yes, your Honour. As Mr Nguyen probably highlighted this morning, AMWU, ACTU and the AMWU-VD object and had written to the Commission outlining their objections. They've communicated to me that they all just rely on those written documents.

PN3085

VICE PRESIDENT HATCHER: Well, is there any particular prejudice that you complain of in relation to the admission of the statement? Obviously it was filed very late and outside of all directions but notwithstanding all that, having regard to the content, what's the prejudice?

PN3086

MR FLEMING: Well, your Honour we submit that much of the statement goes beyond the purpose for which my friend sought to adduce it, and it's evidence that could have been given at any time. It was not something that came out in examination-in-chief and in particular paragraphs 8, 9, 12 and 17 go beyond the matters that my friend said he wished to address in the statement.

PN3087

VICE PRESIDENT HATCHER: Right. Mr Gee, why was this filed so late?

PN3088

MR GEE: A number of reasons, some of which is representative delay, some of which is simply tracking down the right person because she'd moved. There was some delay caused by finding Ms Evans and there was some delay caused by the person taking the statement going on parental leave, and it being (indistinct) that's not due to any fault by Randstad or my client.

PN3089

VICE PRESIDENT HATCHER: In relation to paragraph 16 of the statement, I might be wrong about this but my vague recollection was the effect of the evidence given by Mr Lewin was that the - any request to convert to permanent employment was with Patrick Autocare itself, not with the labour hire company.

PN3090

MR GEE: Well, I've reviewed the transcript closely. He gave about four or five different versions of what was said and done and we thought it was useful to clarify that it was - what we asked is the actual employer of Ms Hunter, was there any dialogue with the actual employer. That's the purpose of paragraph 16 and nothing else.

PN3091

VICE PRESIDENT HATCHER: Right. So it doesn't deny the possibility that the relevant request was made to Patrick Autocare?

PN3092

MR GEE: It does not. We've made submissions about that evidence which is separate to this statement.

PN3093

VICE PRESIDENT HATCHER: Thank you. Is there anything else you want to add?

PN3094

MR GEE: There is not.

PN3095

VICE PRESIDENT HATCHER: We will admit the statement noting that Ms Evans is not required for cross-examination on the statement upon admission, and it will be marked. So it's the statement of Melissa Evans dated 29 July 2016, will be marked exhibit 310.

PN3096

MR FLEMING: May it please the Commission.

EXHIBIT #310 WITNESS STATEMENT OF MELISSA EVANS DATED 29/07/2016

PN3097

VICE PRESIDENT HATCHER: Is there anyone else we can help this afternoon? No. Right, we will now adjourn and resume at 10 am tomorrow morning.

ADJOURNED UNTIL THURSDAY, 18 AUGUST 2016 [5.19 PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #295 STATEMENT OF GARY TALBOT DATED 16/10/2015.. PN1771

EXHIBIT #296 STATEMENT OF GARY TALBOT DATED 16/08/2016.. PN1772

WARREN JOSEPH TEGG, AFFIRMED....................................................... PN1908

EXAMINATION-IN-CHIEF BY MR NGUYEN............................................ PN1908

EXHIBIT #297 STATEMENT OF WARREN JOSEPH TEGG UPLOADED TO FWC WEBSITE ON 23/03/2016................................................................................... PN1927

CROSS-EXAMINATION BY MR FERGUSON............................................ PN1928

THE WITNESS WITHDREW.......................................................................... PN1989

JEREMY CHARLES DINEEN, AFFIRMED................................................ PN2038

EXAMINATION-IN-CHIEF BY MR WALLGREN..................................... PN2038

EXHIBIT #298 STATEMENT OF JEREMY DINEEN, EXCLUDING PARAGRAPH 12, DATED 07/10/2015.............................................................................................. PN2052

CROSS-EXAMINATION BY MR BLEWETT.............................................. PN2054

RE-EXAMINATION BY MS HILLS............................................................... PN2139

THE WITNESS WITHDREW.......................................................................... PN2146

RICHARD THOMAS VAN RUTH, AFFIRMED.......................................... PN2149

EXAMINATION-IN-CHIEF BY MR WALLGREN..................................... PN2149

EXHIBIT #299 STATEMENT OF RICHARD VAN RUTH DATED 12/10/2015 PN2159

CROSS-EXAMINATION BY MR BLEWETT.............................................. PN2161

EXHIBIT #300 ROSTER FOR PRIMO ESTATE.......................................... PN2222

RE-EXAMINATION BY MR WALLGREN.................................................. PN2292

THE WITNESS WITHDREW.......................................................................... PN2298

EXHIBIT #301 STATEMENT OF ALAN RAYMOND ROBINSON DATED 09/10/2015............................................................................................................................... PN2322

EXHIBIT #302 AFFIDAVIT OF GERARD ROBINSON SWORN 07/10/2015 PN2328

CAROL ANNE JARVIS, SWORN................................................................... PN2330

EXAMINATION-IN-CHIEF BY MR WARREN........................................... PN2330

EXHIBIT #303 AFFIDAVIT OF CAROL ANNE JARVIS SWORN ON 01/10/2015 PN2352

CROSS-EXAMINATION BY MR RUSSELL-UREN................................... PN2355

THE WITNESS WITHDREW.......................................................................... PN2403

KRISTY GARDINER, AFFIRMED................................................................ PN2406

EXAMINATION-IN-CHIEF BY MR WARREN........................................... PN2406

EXHIBIT #304 STATEMENT OF KIRSTY GARDINER DATED 12/10/2015 PN2417

CROSS-EXAMINATION BY MR RUSSELL-UREN................................... PN2422

THE WITNESS WITHDREW.......................................................................... PN2475

BRENDA DEVINE, AFFIRMED..................................................................... PN2481

EXAMINATION-IN-CHIEF BY MR WARREN........................................... PN2481

EXHIBIT #305 AFFIDAVIT OF BRENDA DEVINE SWORN 12/10/2015 PN2493

CROSS-EXAMINATION BY MR RUSSELL-UREN................................... PN2496

THE WITNESS WITHDREW.......................................................................... PN2536

EXHIBIT #306 STATEMENT OF ANNICA CLOET DATED 12/10/2015. PN2551

EXHIBIT #307 NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 EXTRACT CLAUSE 18.................................................................................... PN2866

EXHIBIT #308 NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 EXTRACT CLAUSE 13.................................................................................... PN2866

JACK TODARO, AFFIRMED......................................................................... PN2987

EXAMINATION-IN-CHIEF BY MR FLEMING.......................................... PN2987

EXHIBIT #309 WITNESS STATEMENT OF JACK TORADO, UNDATED PN3005

CROSS-EXAMINATION BY MR ARNDT.................................................... PN3006

RE-EXAMINATION BY MR FLEMING....................................................... PN3074

THE WITNESS WITHDREW.......................................................................... PN3078

EXHIBIT #310 WITNESS STATEMENT OF MELISSA EVANS DATED 29/07/2016............................................................................................................................... PN3096