TRANSCRIPT OF PROCEEDINGS
Fair Work Act 2009 29197-1
SENIOR DEPUTY PRESIDENT HAMBERGER
AM2010/212
s.160 - Application to vary a modern award to remove ambiguity or uncertainty or correct error
Application by Real Estate Employers' Federation of New South Wales, The
(AM2010/212)
Real Estate Industry Award 2010
(ODN AM2008/87)
[MA000106 Print PR991073]]
Sydney
9.59AM, FRIDAY, 29 OCTOBER 2010
PN1
THE SENIOR DEPUTY PRESIDENT: Can I have the appearances please.
PN2
MR G. PATERSON: I appear on behalf of the applicant.
PN3
MR M. MEAD: I appear for Australian Industry Group and Elders Ltd.
PN4
THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Paterson.
PN5
MR PATERSON: Thank you, your Honour. This is an application made by the Real Estate Employers' Federation of New South Wales under section 160 of the Act to vary the Real Estate Industry Award 2010. I note, your Honour, that there have been no submissions lodged opposing the application. There have been obviously a number of submissions filed supporting the application. So I suppose its somewhat difficult for me to know how far I need to go in relation to my submissions this morning. But I might just make a few brief points if I may to support the application. The motivation for this application arises from what we say is the uncertainty surrounding the application of clause 4.2 in the Real Estate Industry Award 2010.
PN6
Your Honour I'm sure will have noted that that clause excludes from coverage from the Real Estate Award employers and employees covered by the Banking Finance and Insurance Award. It's what we have described in our submission as an exclusionary clause. We say that there are probably a number of ways that clause may be read or interpreted as to its application. At its perhaps broadest level of interpretation what it will do is as so as a business could be defined as being part of the agri-business industry then this award does not apply.
PN7
THE SENIOR DEPUTY PRESIDENT: Whatever that is.
PN8
MR PATERSON: Yes, whatever that is.
PN9
THE SENIOR DEPUTY PRESIDENT: Mr Mead has got to tell me what the agri-business is.
PN10
MR PATERSON: I hope he can because I don't know, quite frankly.
PN11
THE SENIOR DEPUTY PRESIDENT: I was speaking to someone from a very large brewing company yesterday who suggested he might be in the agri-business industry.
PN12
MR PATERSON: Well, if one takes, as we made mention of in our submissions, your Honour, if you take notice of the Ibis report, it's very broad and all encompassing. What we say is this, there are going to be businesses in rural environments that have people employed in what we will call the traditional real estate sector industry, people listing and selling real estate, residential, commercial, industrial real estate and there will be people in the same business who may be selling stock, who may be undertaking the sale of grain, rural insurances and so on. The problem here is I have a member, for example, this is to take it to an extreme, a member of mine obtains income of around about $1,000 a year from selling water licences. The rest of its operation is traditional real estate.
PN13
Now, if this award applies to its perhaps broadest interpretation that member, that business would be excluded from applying the Real Estate Award and would need to apply the Banking Finance and Insurance Award, and that seems to be incompatible, I submit, with the award modernisation objectives. There is no question in my view that the Real Estate Award was meant to cover all people employed in the listing and selling of real estate and the management of real estate. If one looks at the definition of real estate industry under clause 4 of the Real Estate Award - sorry, I withdraw that Your Honour, it is clause 3, the definition of the real estate industry includes - and there is a list of different services associated and one of those services is stock and station agency.
PN14
In other words if you have classifications of sales or property management employees in stock and station agencies, this award we say ought to apply or was intended to apply. I suppose the basis or the background to the inclusion of this exclusionary clause - I am unable to assist the Commission greatly in relation to how that occurred, other than of course we know that that was a proposal put by the Agri-Business Employers' Federation.
PN15
THE SENIOR DEPUTY PRESIDENT: Who aren't here today which is sort of a shame really.
PN16
MR PATERSON: Yes, and who made no submissions in relation to the matter either. Why perhaps we didn't draw attention to it at the time is perhaps a bit more problematic. I think it's fair to say that certainly my organisation and other employer and employee associations in the real estate industry felt as if the application of this was to be interpreted at perhaps its minimus level, rather than at its broadest level. It's only, I suppose, more recently come to our attention of that concern associated with the improper interpretation of real estate award.
PN17
THE SENIOR DEPUTY PRESIDENT: So what has made that happen?
PN18
MR PATERSON: We have had a number of members ring the federation seeking advice about, well, we have heard that we are not covered by the real estate award.
PN19
THE SENIOR DEPUTY PRESIDENT: I see, but this isn't based on anybody making any claims or anything like that?
PN20
MR PATERSON: No, it's not, we're pre-empting that sort of predicament. We want to avoid that sort of predicament and so what we would like to see is this clause removed from the award which would then reinstate the application of clause 4.8 where the most appropriate award would apply in the circumstances of the business and we recognise and accept that employers could be bound by more than one industry award and that may be the case here but we don't believe it's consistent with the award modernisation objection that there be exclusion of coverage from the Real Estate Award where the employer actually undertakes agri-business activities, whatever they may be. Of course, your Honour, I think it's important in relation to this matter to consider that - - -
PN21
THE SENIOR DEPUTY PRESIDENT: Obviously again I will be interested in what Mr Mead says, but I mean if you take a company like Elders they operate - financial operator, financial services and presumably they also do if you like real estate services.
PN22
MR PATERSON: Yes, they do.
PN23
THE SENIOR DEPUTY PRESIDENT: So what you would say is the employees who are doing the real estate services get covered by the Real Estate Award.
PN24
MR PATERSON: That's correct.
PN25
THE SENIOR DEPUTY PRESIDENT: And the ones who do financial, and I don't know if there would be some employees who might do both, I'm not sure, it would be with the one that was the most dominant.
PN26
MR PATERSON: I don't think it would be proper to say there wouldn't perhaps be some circumstances where that occurs but I think it would be extremely rare. Certainly from my understanding if a person is a stock sales person, they are a stock sales person. They don't sell stock on Mondays and sell real estate on Tuesdays. That’s my understanding. Maybe Mr Mead has a broader understanding of that predicament but that's not the way I understand it to be. One would therefore, I respectfully subject, that if an employer in an Elders office or any other agri-business, associated business is selling real estate then that employee would be bound by the Real Estate Award.
PN27
THE SENIOR DEPUTY PRESIDENT: Yes.
PN28
MR PATERSON: If the employee is selling stock or selling insurance or other financial benefits, then they will be covered by presumably the banking finance and insurance industry. Of course the anomaly here will be, and I don't think you need to be a Rhodes scholar in industrial relations to establish that an employee in office A on this side of the street where the employee undertakes agri-business activities, but where the employee is selling real estate will have different terms and conditions of employment than an employee on the other side of the street in a different business where it's solely a real estate operation and that surely is not an objective of the award modernisation process.
PN29
THE SENIOR DEPUTY PRESIDENT: Stock and station agency, that's included in the definition of real estate in the Real Estate Award, does that involve selling stock?
PN30
MR PATERSON: Yes, it does.
PN31
THE SENIOR DEPUTY PRESIDENT: Livestock.
PN32
MR PATERSON: Yes, it does.
PN33
THE SENIOR DEPUTY PRESIDENT: That’s why I'm just curious when you say that livestock would be - so where would somebody who sells livestock fall? If somebody sells livestock, which award do they fall under?
PN34
MR PATERSON: Well, it's a very good question. Certainly pre-modern award in New South Wales, and I think it's fair to say in all states, if a person is not respondent to the federal Clerical and Salaried Staff Agri-Business Award then they would be award free.
PN35
THE SENIOR DEPUTY PRESIDENT: I see.
PN36
MR PATERSON: But with the making of this Banking Finance and Insurance Award or sorry the definition of industry contained therein to include agri-business activities, one would presume that that is the award to cover them. It seems somewhat strange, dare I say it bizarre, that the stock sales person would indeed be covered by an award titled the Banking Finance and Insurance Award.
PN37
THE SENIOR DEPUTY PRESIDENT: But they're definitely not covered by the Real Estate Award.
PN38
MR PATERSON: No, we accept that.
PN39
THE SENIOR DEPUTY PRESIDENT: I mean in terms of real estate industry - sorry, this is just for my elucidation really, "Real estate industry means provision of services associated with sales, acquisitions, leasing and/or management of residential, commercial, retail, industry, recreational, hotel, retirement, any other lease holder, real property and/or businesses." That's pretty clear. But then it says, "Such services include stock and station agency." What actually - why is that included?
PN40
MR PATERSON: Stock and station agency, in addition to selling stock, will be selling as I said residential land.
PN41
THE SENIOR DEPUTY PRESIDENT: Very well, so presumably it's in relation to those activates.
PN42
MR PATERSON: That’s correct.
PN43
THE SENIOR DEPUTY PRESIDENT: That's a reasonable interpretation.
PN44
MR PATERSON: One might suggest that this gives scope for this award at some stage to be expanded to include people of that kind, but certainly at that stage there are no classifications under the award for people who undertake that activity. So, your Honour, what we say just in summing up, we say that the clause is ambiguous and therefore in accordance with section 160 it ought to be varied. I think Mr Mead will be putting to your Honour perhaps an alternate submission in relation to that but that's what we say. It could be read in a number of different fashions, it could be read broadly or perhaps narrowly and we say in any event because of that uncertainty it ought to be removed to ensure that the integrity of the Real Estate Award is maintained to the extent that it covers real estate activities and that any agri-business type employees would then be bound by a different modern award. They are our submissions unless there are any further questions from your Honour.
PN45
THE SENIOR DEPUTY PRESIDENT: Thank you, Mr Paterson. Mr Mead.
PN46
MR MEAD: Thank you, Your Honour. Your Honour, could I just say at the outset of our submissions that we concur with the submissions put by my friend Mr Paterson in relation to the application and the grounds in support of the application of varying the Real Estate Award for ambiguity and uncertainty. It's our view, as expressed in our written submissions, that the result of the exclusion which is currently contained in the award does create significant uncertainty in relation to the appropriate application of the award in particular circumstances and that is a result that is not helpful nor one that is supportive of the modern award objectives. Your Honour asked Mr Paterson if in fact he could define the agri-business sector and I'm not sure if I can do a great deal better. Obviously the Ibis report that Mr Paterson referred to in his submissions is one possible definition. If I could proffer another, it's one that essentially I draw from submissions that were made by the Agri-Business Employers' Federation in stage 2 of award modernisation. It's a submission of 1 December 2008. I apologise, I don't have a copy to provide to the bench.
PN47
THE SENIOR DEPUTY PRESIDENT: 1 December.
PN48
MR MEAD: 1 December 2008 and in essence what the Agri-Business Employers' Federation do in the context of trying to define the scope of the Agri-Business Clerical and Salaried Staff Award is draw reference to their rules of association, given the fact that their members are respondent to the award in accordance with schedule A of that instrument. What they do identify in addition to those matters identified by reading from their submission today is that matters such as, "Provision of services concerning livestock and sheep; the provision of wool and other textile handling and/or storing and/or processing services; the provision of financial and banking services; provision of insurance services; these ale and supply of merchandise; the provision of transport services; provision of real estate and property services and provision of services concerning grain and grain products."
PN49
So a very broad and expansive I guess definition of that sector by virtue of that association's rules. It is our submission essentially that whilst the term "agri-business" found its way into the Banking Finance and Insurance Industry Award that we believe what the Full Bench had in mind when inserted that terminology, specifically the financial and banking and insurance aspects of agri-business as opposed to real estate specifically. Just in support of that submission it seems quite evident in the context of the decision that was handed down for the stage 2 award modernisation - the making of those awards, including the Banking and Finance Award that at paragraph 135 the Full Bench deals with the submission of the Agri-Business Industry Association for the creation of an independent agri-business award.
PN50
What they say is that the agri-business industry has, "Many aspects in common with parts of the finance sector and no other industry is a more logical fit." So it doesn't appear in our estimation that they squarely concerned with the real estate aspects, we would say services aspect of agri-business when they inserted agri-business into the Banking and Finance Award. What flows from that, and this really as alluded to already by my friend is that the situation is complicated by virtue of the exclusion and the way in which in essence the Banking and Finance Award classification structure operates, in our submission. It's our primary submission that - - -
PN51
THE SENIOR DEPUTY PRESIDENT: You do support the idea of just getting rid of that exclusion.
PN52
MR MEAD: Absolutely, absolutely, and we believe that is the appropriate decision to resolve - - -
PN53
THE SENIOR DEPUTY PRESIDENT: It was presumably put in to try and make things clearer, it just didn't quite work.
PN54
MR MEAD: Absolutely, and we say if one removes that exclusion then the rule to deal with overlap that was (indistinct) by the Full Bench is the appropriate mechanism to resolve all those issues.
PN55
THE SENIOR DEPUTY PRESIDENT: Yes.
PN56
MR MEAD: Your Honour, my friend alluded to an alternate submission that we have and I won't develop it more than it needs to be developed, but it's an alternate submission that arises should this Tribunal determine that there is no ambiguity or uncertainty and the only reason we identify this as an alternate submission is we believe that the Tribunal has power under section 157(3) of the Fair Work Act to vary an award on its own initiative, on its own motion if it believes the award does not meet the modern award objectives.
PN57
We would submit that if a real estate business that does some rural real estate functions can be removed from the Real Estate Industry Award by virtue of the exclusion and pulled into the Banking and Finance Award, that cannot be said to create a relevant safety net for those employees and that does not support section 137, the modern award objections and we say this Tribunal would then have grounds to make that variation. So we advance that as an alternate submission but it doesn't derogate from our primary submission that there is ambiguity and uncertainty that should be remedied. Your Honour, those are the only submissions we would seek to make.
PN58
THE SENIOR DEPUTY PRESIDENT: So with Elders obviously you have people who do deal in real estate as well as if you like financial products and other things as well. I don't know with the livestock - I'm not sure buying and selling livestock, do you think that fits now within the finance award or is just a moot point?
PN59
MR MEAD: It's difficult, yes.
PN60
THE SENIOR DEPUTY PRESIDENT: We don't have to delve into it. So you think if you just remove that exclusion then the general provision that deals with how you deal with it where an employer is covered by more than one award will deal with it so that your employees who do financial services will be covered by the Financial Services Award and those who do real estate, and in fact is that going to be a reasonably clear - is it usually going to be fairly clear with Elders employees where they fall?
PN61
MR MEAD: Yes, we submit that probably in 99 per cent of circumstances, 99 times out of 100 it will be very clear as to the - - -
PN62
THE SENIOR DEPUTY PRESIDENT: I just want to make sure that by fixing this up we are not creating some other problem.
PN63
MR MEAD: We haven't been instructed by Elders that this will create a problem, in fact the solution that's being advanced by Reith in our submission is the perfect solution to fix this unintended situation.
PN64
THE SENIOR DEPUTY PRESIDENT: Very well. Given that it's the perfect solution I will indicate now I will be acceding to it. I will give some written reasons at a later date but I might as well indicate now that I will agree to the application.
PN65
MR PATERSON: Thank you.
PN66
THE SENIOR DEPUTY PRESIDENT: We can adjourn.
PN67
MR MEAD: Thank you, your Honour.
<ADJOURNED INDEFINITELY [10.19AM]