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Fair Work Act 2009                                                    






s.156 - 4 yearly review of modern awards


Four yearly review of modern awards





10.01 AM, MONDAY, 10 APRIL 2017


Continued from 5/04/2017



VICE PRESIDENT HATCHER:  Is there any change in appearances?  All right, I'll just simply note all the appearances as before.  Mr Schmitke, you have filed and served some draft determinations?


MR SCHMITKE:  Yes, that's right, your Honour, I have indeed.  There were three separate determinations that you provided to the Commission and parties on Friday.  I might just identify them and just take you through them.  The first is a determination which is relating to the Building and Construction General Onsite Award.  It is a determination which only outlines particular clauses to be deleted.


VICE PRESIDENT HATCHER:  That's the short one?




VICE PRESIDENT HATCHER:  Is that the primary position, is it?


MR SCHMITKE:  Yes, it is.




MR SCHMITKE:  The next determination also relates to the same instruments Building and Construction General Onsite Award 2010.  What that particular determination contains is in the Commission's format, draft determinations for our other claims, more broadly.  In terms of items 5, 6 and 7, they are a recast version of items or clauses, 20, 21 and 22 of the award which is the sections or the provisions of the award which we say contain most of the issues about which we've made claims regarding allowances and work, health, safety matters.


VICE PRESIDENT HATCHER:  Is it possible that you could provide us with a marked-up version as compared to the current award so we can – at some stage so we can see what's been deleted.


MR SCHMITKE:  Yes, certainly, at some stage.  Yes, certainly.  In fact, your Honour, in the submissions today, I was going to take the Commission through some of those matters.


The third one is in relation to the Joinery and Building Trades Award 2010 and that is again reflective of the other matters about which we have sought variations and advance claims.


VICE PRESIDENT HATCHER:  Right, thank you.  Are there are any preliminary matters we need to deal with before we start dealing with these issues, one by one?  No.


The first issue is your claim for allowances and the related work, health and safety issues.  We'll start with that.  That's your claim Mr Schmitke.


MR SCHMITKE:  Thank you, again, your Honour.  Your Honours and Commissioners, I want to, if I may, make a couple of remarks before I get into the nitty gritty of the various that we propose.  I would like to make those remarks because it's important, I think, that the parties and the Commission is clear about what represents a substantive number of items that we've advanced in terms of our total overall claims.


It is the case that we say when it comes to work, health and safety matters the contention we've advanced is that there are problems contained with inclusion of terms that deal with or purport to deal with work, health and safety matters that are contained within the onsite award that we say should be properly dealt with and are properly dealt with by other laws.


The consequence of the inclusion of those particular items creates a number of problems.  Those problems are the potential to create confusion amongst industry participants; the creation of, or purported creation of inconsistencies with respect to the obligations or industry participants; the creation of an impression that obligation is established elsewhere, can be satisfied or met through the satisfaction of what should be award conditions; that these problems create a scope for disputation and disagreement in an otherwise already lengthy and complicated award, and that the inclusion of those matters are not necessary to achieve the modern award's objective or indeed the broader aims of the Act overall.  In fact, we say that they could potentially detract from them.


I'll come back to some examples of where I take you through some of those problems in specific terms shortly.  Again, I just want to make some commentary about the backdrop against which we've raised these problems.  Firstly, you've got to consider this claim in the context of the building and construction industry.


The comments I made last week noted that yes, this section, like normal workplaces has got normal workplace problems, but there are also nuances within the sector.  We say that you need to have regard – we would ask the Commission to have regard to those nuances in the context of this claim.  We have the type of work that's being performed, which involves a higher risk, a higher degree of inherent risks than many other types of work, in other sectors.


The building and construction industry is considered to be a priority industry by Safe Work Australia which means, it is an industry which is susceptible to workplace accidents and where work, health and safety is important, perhaps more so than other sectors' obligation.  It's also a sector which is not only governed by the normal Work Health Safety Act and regulations, but construction-specific regulations, construction-specific codes, standards.


There is a Commonwealth Government construction-specific occupational health and safety accreditation scheme.  There is the Building and Constructions Industry Improving Productivity Act, and there's the associated code, all of which set particular obligations for the participants in this sector, many of which touch on safety matters.


In addition, this is a sector which, aside from being renowned perhaps, regrettably, for its high level of dispute and disagreement, it's also a sector which features, or where the basis for that dispute or disagreement, arises in relation to matter involving safety.  Now, this was noted in the final report of the Royal Commission into Trade Union Government and Corruption.  That report consisting of some five volumes, is littered with examples of where this has been identified.


An extract which we provided this morning, which comes from volume 3, page 48 to 69, is just a relevant example.  Perhaps the most pertinent example of the conduct about which I refer to.  I'm not going to take the Commission through that.


VICE PRESIDENT HATCHER:  Mr Schmitke, do we have that, do we?




MR SCHMITKE:  I have some copies I can hand up.


MR CRAWSHAW:  I take it my friend is reopening the evidence by relying on this.




MR CRAWSHAW:  At least admit he must be reopening the evidence if he's trying to put this before you.


VICE PRESIDENT HATCHER:  What are you putting this before us as?


MR SCHMITKE:  For the Commission to be alive to the circumstances within – that face this sector, to create the context for which we make our claim.  Because the argument which I will shortly be advancing is that while there are things that need to be fixed in the award, you need to have, and we submit the Commission should have regard to the specific context of the industry within which that award applies.


VICE PRESIDENT HATCHER:  But you're advancing this as evidence of that context, are you?


MR CRAWSHAW:  I make reference to that as a – that is a pertinent example contained in an otherwise bottomless document which is already on the public record.


VICE PRESIDENT HATCHER:  What is the example?


MR SCHMITKE:  It's a general example, I'm making reference to - - -


VICE PRESIDENT HATCHER:  No, where in the document is the example?


MR SCHMITKE:  This is the conclusion section of the particular – I think it's volume three, which makes reference to conduct involving disputation in the building and construction industry over matters involving work, health and safety.


DEPUTY PRESIDENT HAMILTON:  In a sentence, what does this go to?


MR SCHMITKE:  Safety and disputes about safety in the building and construction sector, are more frequent than anywhere else.  It's therefore important that if there's confusion created by the underpinning instrument, if it can be read that it's creating a safety obligation, well then, it's important that we clarify that it's not; that it's not a safety obligation.  If it exists to establish an entitlement to an allowance, if we have provisions like that in the award, we need to make it clear.


When the Commission considers our claims in the context of a variation which is desirable, merely desirable versus necessary, we would say the Commission should have regard to the nature of this industry and it should err on the side of necessary, given the conduct which is on the public record.


VICE PRESIDENT HATCHER:  Does the document do anything more than say that there's a lot of disputes about safety in the construction industry?


MR SCHMITKE:  No, it does not.


VICE PRESIDENT HATCHER:  Right, well I think we know that.


DEPUTY PRESIDENT GOSTENCNIK:  Does the document speak to any confusion between the relevant award provision that we're considering and occupational health and safety legislation?


MR SCHMITKE:  Your Honour, no, I can't say that it does.  What it does however do, is talk about the conduct of the parties when it comes to safety matters in the workplace.  We need to consider this from the perspective, not of the parties in here, who are paid and employed to get their head around these instruments.  We need to consider this from the perspective of what's happening on the ground.


DEPUTY PRESIDENT HAMILTON:  Sorry, did you say that occupational health and safety is the most frequent cause of industrial activity?


MR SCHMITKE:  It is a very common cause.  It's more frequent in this sector than certainly in any other sector.


DEPUTY PRESIDENT HAMILTON:  So, it's a very common cause.


MR SCHMITKE:  Yes, and in comparison to other sectors, it is very much more frequent than would otherwise be the case and that is important from the perspective of the context within which we're making this submission.


VICE PRESIDENT HATCHER:  Is there any evidence that any provisions of the award which you characterise as being about work, health and safety has caused or has been involved in a dispute?


MR SCHMITKE:  There's a section, and it's certainly not within the section that I've provided the Commission.  That was just merely to draw the attention of the Commission to a snapshot of what is otherwise contained elsewhere in the final five volume report.


VICE PRESIDENT HATCHER:  Anyway, you don't want this marked as an exhibit?




MR CRAWSHAW:  I get back to my point, that it's - - -


VICE PRESIDENT HATCHER:  Well, he's not tendering it, so I'm not sure what it is, but it's not being tendered.


MR CRAWSHAW:  Well, if it's not going to be evidence, I won't say anything, but it's one man's opinion, Mr Haydens.  By the way, we don't accept the proposition from the Bar table that there's more disputes in this industry than any others in relation to safety.  There's no evidence of that.


MR SCHMITKE:  Again, I make these points because it's important to ensure that when it comes to the obligations, the rights and responsibilities of building industry participants, they need to be very very clear when it comes to safety matters.  I should indicate that I'm not necessarily putting a position that says they do regulate safety.


VICE PRESIDENT HATCHER:  Mr Shcmitke, again this document.  If I look at the conclusions, this report appears to deal with allegations of union officials or authorised representatives of industrial organisations or whatever the corresponding term might be, under the ACT scheme, about using right of entry in respect of what might be said to be spurious occupational health and safety concerns.  But if you look at 69, that's what the conclusions are all about.


MR SCHMITKE:  Yes, that is the case, your Honour.  That is exactly right.


VICE PRESIDENT HATCHER:  But how is any of that relevant to any manner that we need to decide?


MR SCHMITKE:  It's relevant in terms of the consideration of what's necessary to achieve a modern award objective and what's merely desirable.  We would say that have the Commission to have regard to the circumstances of the sector within which the instrument applies.  In other words, if there is confusion that exists created by this instrument, then it ought to be resolved at the best of times.  But it ought to be resolved in this sector on the basis that it's an area which is often in dispute.


It's an area within which, as that report notes, the parties and the participants refer to and use for other purposes.  We're just simply saying this award shouldn't create the impression that it regulates safety.  It shouldn't create confusion amongst industry participants, and to the extent that it does - - -


VICE PRESIDENT HATCHER:  Did we hear any evidence about confusion amongst industry participants about the award provision?


MR SCHMITKE:  Yes, we did.


VICE PRESIDENT HATCHER:  What was that evidence?


MR SCHMITKE:  I can refer to Dr Ayers from the CFMEU, Mr Solomon from Master Builders New South Wales.  These are two individuals who are employed and paid to provide advice to their members about safety in the sector.  They can't – they couldn't agree.


DEPUTY PRESIDENT HAMILTON:  Mr Schmitke, I think you have to be specific, as in page 38 of the award, there was a list of equipment which was said by the CFMEU expert witness, whose name escapes me, to be inconsistent with Rogan's provisions, that's my recollection.




DEPUTY PRESIDENT HAMILTON:  I'm sure transcript will correct me or otherwise.  You need to be specific like that, if you want to make that submission.  Otherwise it will not be given any weight.


MR SCHMITKE:  I will return back to that shortly, when I go to the specific clauses.  This was again, just a document which I provided for no other reason just to assist the Commission to say this is a matter of public record, that there have been observations made outside of this place, with respect to the confusion about safety.  I'm not saying that the cause is the award, but I'm not saying that the award assists in any way.


As I also noted last week, it's a sector that's grown.  We need to attract a larger proportion of the workforce to address our future needs.  Basically, we have to get the safety issue right. We've got inherent risks; we don't want it to another source of potential disputation.  We want people and the industry to be very clear.  That's a goal that we say isn't assisted by the award as it is currently provided, particularly those areas that are the subject of our claims.  We think that the award should regulate employment conditions and let the other forms of regulation and codes deal with safety as they're supposed to do.


There are a number of propositions we've advanced. The primary one, is one that I'm aware has been raised in this Commission on earlier occasions.  I'm instructed to do so again for the reasons I've just covered.  But that primary reason is that these provisions, where they purport to regulate work, health, safety, should be removed from the award and that is reflected within the determination I filed.


We say that the work, health, safety laws set out participant obligations overall, and that discharging those obligations is the best way to ensure workplaces are safe.  Of course, as a general proposition, my instructions are that if those obligations are discharged, then there should be no need for additional remuneration for work that's not an uncommon feature of the sector.


This is particularly so, given the existence of other general industry and special allowances which are designed to compensate for conventional conditions associated with the type of work covered by this award.  As I've mentioned earlier, the payment of additional remuneration runs the risk of creating an impression of danger money to compensate for risky work and jeopardising the extent to which that risk should be minimised.


Again, I'm cognisant of the Commission's observations and decisions in earlier proceedings before this place, that many of what we would categorise as work, health, safety style provisions are actually there to establish a payment allowance.  There's other clauses elsewhere within the award that are not related to allowances, but also involve things like types of employment hours of work, and so forth.


The point of these earlier decisions, is that they didn't alter with some minor exceptions the provisions in question.  They just established the basis for the existence of that provision.  That didn't address the problem.  The provision still looks like a work, health, safety provision and to that end, it creates an impression that could lead to confusion, and we say does cause confusion within the sector of those who use the award, and clarity and certainty is required.


Even if a provision is specifically there, and only there, to establish and set conditions that trigger an allowance, then if they look like a work, health, safety law, or if they describe conditions that could be a breach, well then, they should just be removed, leaving the allowance provision as it currently remains.  In other words, if it's confusing, take out anything that looks like work, health, safety; replace it so that the allowance provision can remain operative, and there's a clear distinction.


VICE PRESIDENT HATCHER:  This is the alternative position, now?


MR SCHMITKE:  It is the alternative position, that's correct.


VICE PRESIDENT HATCHER:  The primary position is to just take away an allowance?


MR SCHMITKE:  Remove the provisions in the award which have a work, health, safety flavour.  That is my instruction, yes.  But the alternative position, in light of those earlier proceedings, and the remarks I've just made, are that they should be removed from clauses to the extent that they're not necessary to achieve the aim of that clause, or replace them with a generic reference, but only when necessary.


Clauses or redraft of clauses 20, 21 and 22 which are items 5, 6, and 7 in the determination, are - - -


DEPUTY PRESIDENT HAMILTON:  A lot of these allowances seem to be, essentially additions to the skill base classification system.  They say if you do a certain type of job, you need an extra skill, therefore you need an extra payment.


MR SCHMITKE:  Correct, yes.


DEPUTY PRESIDENT HAMILTON:  Aren't they sort of classification payments?


MR SCHMITKE:  Yes, correct.  That is not a proposition that we're contesting.  That's not a proposition that we're contesting in an alternative position.  The primary position, yes we would say that that's – that they are regulating work, health, safety matters. But the alternative position - - -


DEPUTY PRESIDENT HAMILTON:  I mean as the work within this existing award skill classifications, so are allowances necessary?  You see, if a skill based classification already encompasses this sort of work, such as – I don't know – furnace work or acid work or bitumen work, if that's already within a skill based definition, in a general classification structure, why do we have an additional allowance as well?


MR SCHMITKE:  Well, for three reasons, potentially.  It could well be the disability associated with that particular type of work.  It could be an expense or related work reimbursement allowance, or it could be a skill related allowance on top of the additional work or the existing classification.  That's been determined by the Commission and the observations made in earlier proceedings.


The primary position would contest that. The alternative position says, okay, accepting that, let's make it clear what they are here for and what they're not here for, because otherwise, the sector gets confused.  That's the overall position.


DEPUTY PRESIDENT GOSTENCNIK:  Mr Schmitke, your primary position, or the primary submission is based upon some notion that as a matter of policy, occupational health and safety matters shouldn't be contained in awards.  Because, a legislative scheme contemplates that awards may contain such provisions otherwise the inconsistency provisions wouldn't be necessary in the Act.


MR SCHMITKE:  Yes, your Honour, you're absolutely right.  But that said, the modern award objectives to which the parties are having regard in these proceedings, doesn't necessarily contemplate that, nor does the broader overall objects of the Act.  That's not to say that industrial relations and work, health, safety are always going to be complete separate distinct issues.  That's completely unreasonable to advance that position.


But from a practical perspective, if there is confusion that can be alleviated, to better clarify the obligations of the parties, and that confusion arises from some of these provisions within the instrument, well, let's clarify them.  Let's clarify them.  Perhaps I might just take your Honours and Commissioners to clause 22.2(q) which is on page 50 on the on-site award.  This is an issue which has been raised on earlier occasions.


This clause deals with height work, and essentially is says that where somebody is working on any structure at a height more than nine meters, so nine meters in the air, not above ground.  When adequate fixed support not less than 0.75 meters wide is not provided, then they get an extra 2.9 per cent of the standard hourly rate.  It's our view that this is a particular clause which shouldn't exist because it describes the circumstance that shouldn't exist.  In fact, the clause itself says, what is adequate?  It defines what is adequate and that's defined as being 75 centimetres in width or more.  It specifically says if you're not providing something that's adequate, an employee should get an additional payment for it.


That was a provision which was considered in earlier proceedings and of course, the Commission made the observation that that is in fact a condition about how work is performed.


VICE PRESIDENT HATCHER:  What's a boatswain's chair?


MR SCHMITKE:  That is a good question, your Honour.  I think the evidence of Mr Solomon was that he's never heard of such a term being used in the sector.




MR SCHMITKE:  I think that's its origin.  But essentially, this conflates the situation that just should never exist.  That's the difficulty with this particular clause.  It's an allowance which should never be paid.  You're paying somebody this allowance and not providing a safe system of work.  Simple as that.  It's manifest on its face.  It can be read no other way.


I accept that there are other provisions, and we accept there are other provisions elsewhere within this instrument which aren't this specific in describing what's inadequate and an additional amount payable in that situation.  But this is manifestly one which, on its face, could create the impression of danger money.  Again, we can all – all the parties here can have regard to specific regulation or the general provisions of the Work, Health, Safety Act or codes of practice and we can understand what this means, but how is this going to be read on the ground by somebody who's employing their first employee or somebody trying to interpret this award.  How is it to be read?


VICE PRESIDENT HATCHER:  How might it be read then?


MR SCHMITKE:  It could be read as creating a payment of danger money.  Whether it does or it doesn't, isn't actually necessarily our point.  Our main point is that's the impression that this clause risks creating amongst award users.  If we are going to meet the objectives of the – or the modern award's objectives, clauses like this one just shouldn't simply exist.  Because arguably, if it does exist, you breach the law, you breach the law.  The clause has no work to do.  It's just simply not operative.


VICE PRESIDENT HATCHER:  Are you submitting that any circumstance where that clause might be applicable is by definition unsafe?




VICE PRESIDENT HATCHER:  What's the evidence for that?


MR SCHMITKE:  Well, the clause itself describes something that's not adequate.




MR SCHMITKE:  It says on a suspended platform that is not adequate.  Or in fact it says 'where an adequate fixed support not less than 0.75 meters wide is not provided.'


VICE PRESIDENT HATCHER:  It might be an adequate fixed support that's less than 0.75 meters wide.


MR SCHMITKE:  I'm sorry, your Honour?


VICE PRESIDENT HATCHER:  The clause might operate where there is adequate fixed support, but it's less than 0.75 meters wide.


MR SCHMITKE:  I cannot envisage the circumstance where somebody is working nine meters above the ground on a platform, however so described, which is less than 75 centimetres wide.  I would not submit that that is a safe work practice.  But again, your Honour, you have the benefit of reading that with your eyes, but this isn't necessarily how its read in the sector and that's our main contention.  It just runs the risk of creating these impressions.  If it's been identified as something which triggers entitlement to an additional payment, make that clear.  That's the intention of the claims we've advanced in most of these areas.


I'll take your Honours and Commissioners further to clause 20.1(c) on page 38 of the award which deals with toxic materials.  This clause essentially says where an employee is required to use toxic substances and there's an absence of adequate natural ventilation, they've got to be provided with particular type of equipment, particular types of protective clothing, soap and washing materials, a pneumatic rubber tyred wheelbarrow, loads of bricks and materials and overalls, only where necessary, when bricklayers are engaged on work covered by clause 22.2 and 22.N which I think is furnace work and acid work.


This provision, there's a number of problems with it.  Even if it is used simply to determine when an expense may be reimbursable, does it not apply in situations where you do have adequate natural ventilation.  Because, if you've got adequate natural ventilation, that's not going to have an impact on soap and washing materials, or wheelbarrows, or overalls.  None of those things are determined on adequate ventilation.  You can understand where this clause came from.


DEPUTY PRESIDENT HAMILTON:  I think the evidence from the CFMEU witness was something along the lines of this specificity is inconsistent with the Roben's approach.


MR SCHMITKE:  That's correct, your Honour.  That is the case.


DEPUTY PRESIDENT HAMILTON:  That's the only evidence I know about this clause, whatever – I mean, are you adopting that?  Is that your submission?


MR SCHMITKE:  Well, that is our submission.


DEPUTY PRESIDENT HAMILTON:  Are you trying to produce additional elements?


MR SCHMITKE:  That is our submission.  I'm just making the distinction that when we are seeking to make the variations we make, particularly in the context of the alternative provision, where we are having regard to the earlier observations of this Commission regarding this subject, this is a provision which isn't – has very little work to do and is of no use to the parties, it's there to establish a particular situation where expenses are reimbursed, well then let's make that really clear as to why it's there.  Otherwise, it creates confusion.


It is inconsistent with the Roben's principles.  It is inconsistent with what's transpired in work, health, safety law in the last 20 years.  Many of these provisions in this award have existed for quite some time.


DEPUTY PRESIDENT HAMILTON:  The problem is, you haven't gone through each clause and set out and demonstrated the appropriate approach under OH&S legislation and then contrasted it with the clause.  What you've done is made various general observations, not necessarily supported by that sort of OH&S analysis.  There was evidence about that clause, but there hasn't been evidence about just about all of them.  How can we do anything in the absence of evidence?


MR SCHMITKE:  We say that you've got the power to resolve the confusion and create certainty.  There's provisions within the Acts relevant to this section which talk about the Commission's power to ensure that clauses are operating in a practical way.


VICE PRESIDENT HATCHER:  One issue that might arise with that clause is whether it's a provision that may be permitted in a modern award at all under the Act.


MR SCHMITKE:  It's been found to be categorised that way in the 2012 decision - - -


VICE PRESIDENT HATCHER:  Categorised as what?


MR SCHMITKE:  This one was categorised as providing for the reimbursement of expenses of employees in providing particular protective clothing.


VICE PRESIDENT HATCHER:  You're reading from what?


MR SCHMITKE:  This is the decision of - - -




MR SCHMITKE:  Yes.  That was a finding from paragraph 70 in the two-yearly review decision of Senior Deputy Presidents Watson, Hamberger and Commissioner Cargill.


VICE PRESIDENT HATCHER:  As a reimbursement of expenses?










DEPUTY PRESIDENT GOSTENCNIK:  Is that specifically in relation to paragraph (c) or is it in relation to clause 20.1?


MR SCHMITKE:  It's 20.1(c) specifically, so when these matters were last agitated - - -


DEPUTY PRESIDENT GOSTENCNIK:  Just trying to find the expenses reimbursement for that clause.


MR SCHMITKE:  It's where they're providing equipment – where they're not – it's basically where they're required to use those particular products.


DEPUTY PRESIDENT GOSTENCNIK:  As I read paragraph (c), if the person works in the environment as described performing the functions that are set out on 22.1(ii), that is they must be provided with certain things.  It doesn't say anything about reimbursements.


MR SCHMITKE:  Well, your Honour, I think if you go back in the award, this is in the context of a clause that deals with a tool and employee protection allowance.  All the other clauses, subclause (b) in particular, talks about the allowances payable to employees are for providing particular types of protective equipment or tools, and then it says, where they're not provided, they shall be reimbursed, or alternatively the employer may let to provide the equipment.


Then there's a whole series of lists and the numerous subclauses specifying in great detail the types of equipment and tools. This is subclause (c) in that particular provision.


VICE PRESIDENT HATCHER:  The provision of tools – - -




VICE PRESIDENT HATCHER:  The failure of the employer to provide the items in (c) results in a payment of an allowance.  Is that the way it works?




DEPUTY PRESIDENT HAMILTON:  That's what it says in (b), page 36.




VICE PRESIDENT HATCHER:  So where is the power to require the provision of those things in the first place?


MR SCHMITKE:  That's a good question, your Honour.


DEPUTY PRESIDENT GOSTENCNIK:  It was the Vice President's question.


MR SCHMITKE:  Yes, it's right.  Of course, the document that we've provided to the Commission last week, confirmed that there isn't that power.  This was another general point that I was going to make.  Again, I'm making these comments on the basis that there is some sort of capacity for an employer to say well, you know, bring your own safety goggles, bring your own whatever is needed to perform work safely.


Again, that particular presumption has got to be questioned.  And again, how can it be said that this award is discharging its obligation to provide a fair and minimum safety net and clear part of modern award systems sustainable, relevant, simple – it's just not.  It's just not.


DEPUTY PRESIDENT HAMILTON:  Where do these lists come from?  They don't come from any – they come from OH&S documents specifying safety in a particular sector, or are they just made up by the parties?


MR SCHMITKE:  No, your Honour, Mr Solomon's evidence, I think it went unchallenged, was that many of these provisions exist from the award at a point in time when safety was regulated a prescriptive way.  We didn't have a national work, health, safety system.  We had specific laws and awards did regulate safety in the absence of any other mechanism to do so.


But two things have happened, or a number of things have happened, including the Roben's principles, national system of awards.  They've moved to this sort of less prescriptive approach.  These provisions are all in timing consistent with what's happened in the last 30 years, essentially.


DEPUTY PRESIDENT HAMILTON:  Are they accepted generally, as appropriate for particular sectors?  For example, plasterers, all floating rules, trammel centres, et cetera?


MR SCHMITKE:  That particular provision is in relation to tools.  Now, if I can take the Commission to our determination in this respect, you will note that the determination has left that clause there, removed the references to protective equipment, so it's clear, but otherwise, left the circumstances where a person provides their tools.  It's deleted references to any safety equipment or protective equipment because we say it shouldn't be there.


VICE PRESIDENT HATCHER:  Mr Schmitke, it might be useful and probably necessary with respect to a primary claim and an alternative claim, if you take us through allowances clause by clause.  First of all, where you seek to delete them and explain why you want them deleted and what characteristics of each clause you want deleted.


I mean, there's some force in what you say about 22.1(c), but I'm interested to see what your rationale for the others is.


MR SCHMITKE:  Your Honour, what my intention this morning was simply to give two or three more examples of different types of problem that we've identified and then essentially advance our proposition and our draft determination solves all those problems.


VICE PRESIDENT HATCHER:  I know that's your intention, that's why I was inviting you to do something a bit different, so I actually understand the rationale for each element of the claim, just to go through them clause by clause and explain.


MR SCHMITKE:  Certainly, so essentially with clause 20, which is item 5 in the determination.


VICE PRESIDENT HATCHER:  You start with 20.1(b)(vi).


MR SCHMITKE:  Sorry, your Honour, is that in the alternate position?




VICE PRESIDENT HATCHER:  Yes, starting with your primary position.


MR SCHMITKE:  The primary position?


VICE PRESIDENT HATCHER:  Yes, starting with that.




VICE PRESIDENT HATCHER:  That goes out why?


MR SCHMITKE:  Sorry, which clause were you - - -


VICE PRESIDENT HATCHER:  Well, the first one in your list, 20.1(b)(vi).


MR SCHMITKE:  Yes.  This is a provision specific to civil construction and it is again in the context of that same clause we were just discussing about tools and protective equipment as it currently stands.  Our primary position is to delete this entire clause because it prescribes things which are better regulated by work, health, safety laws broadly and is inconsistent with the non-prescriptive approach.


It doesn't achieve any modern award's objective that I can find and in fact, it potentially confuses the parties.


VICE PRESIDENT HATCHER:  The problem is if you delete it, it may then have the result that an employee can be expected to provide those items as part of the provision of the tool allowance.  Doesn't it have that result?


MR SCHMITKE:  Yes, and in the alternate position.


VICE PRESIDENT HATCHER:  No, but that – I don't want to run away from that proposition.  Isn't that the result of what you're doing?  The provision of those items then become incorporated in the tool allowance.


MR SCHMITKE:  We would say no, that's not the case.




MR SCHMITKE:  Because if – these items are not tools, these are protective equipment, that's the distinction.  The other things about floating rules and trammels, brush and roller, well these are things that might be tools of the trade as it were; they're not protective equipment.  But that's the issue.  This particular subclause refers to protective equipment.


VICE PRESIDENT HATCHER:  So there's no circumstance in which the deletion of that clause would result in an employee being required to provide that equipment?


MR SCHMITKE:  That would not be – or no, that is right, because it's protective equipment.  The employer is obliged to provide protective equipment.


DEPUTY PRESIDENT GOSTENCNIK:  Does that mean that you'll need to either delete or modify paragraph (b) of 20.1?  First of all, it makes clear that provision of the following tools and protective equipment is not included in the tool allowance.  Then secondly, it sets out that where the following et cetera are provided by the employee, then the employee is to be reimbursed at cost.


MR SCHMITKE:  Yes.  This entire clause has been amended, or would require amendment to remove the references to PPE or anything that purports to be protective equipment, because it's tools - - -


VICE PRESIDENT HATCHER:  We could just say, in those circumstances an employee required to provide PPE is not included in the tool allowance.


MR SCHMITKE:  That is something that could be said; that is the case, your Honour, absolutely.


VICE PRESIDENT HATCHER:  Does that conform with reality?


MR SCHMITKE:  It doesn't really matter if it conforms with reality, because that's what the regulations provide.


VICE PRESIDENT HATCHER:  For example, the provision of a T-square for brick layers.  It may well be a safety equipment but I think it's more likely that it helps the bricklayer lay straight bricks.


MR SCHMITKE:  Tool of the trade.


VICE PRESIDENT HATCHER:  Yes, but if that is currently not included in the tool allowance, what does one do with that?


MR SCHMITKE:  One leaves it where it is.  That's the point.  We don't seek to necessarily - - -


DEPUTY PRESIDENT HAMILTON:  You're not removing (i)?




DEPUTY PRESIDENT HAMILTON:  You're removing (iv).


MR SCHMITKE:  That's right.


COMMISSIONER GREGORY:  Isn't protective clothing sometimes tools?


MR SCHMITKE:  It can be the case, that can be the case.


COMMISSIONER GREGORY:  But (vi) isn't, you say?


MR SCHMITKE:  Yes, that's right.  This is clearly protective equipment and it's the clause that talks about tool allowances.  It's categorised as tool or protective allowance, but it's a tool allowance.  I mean, that's what it is.  It's a tool allowance.  So yes, sure, you've got the requirement to provide particular tools and people get paid an allowance for doing so, that's fine.  We don't seek to disturb these other provisions; only those particular areas that purport to be protective equipment.


DEPUTY PRESIDENT HAMILTON:  Well, (vii) that isn't the case.  All power tools and steel tapes.  That's not protective clothing, that's tools, and you want to delete that.


MR SCHMITKE:  That is the primary position.  The alternate position, leaves it, but it deletes the subsequent provisions which talks about gloves, the hand and protective paste, the protective clothing for employees required to use acid.  Material or coloured glass protection of employees working on oxy acetylene, screens to protect employees from flash, gas masks, hand and protective paste again.  All these are things which are – should be provided by an employer.


VICE PRESIDENT HATCHER:  Where's that dealt with in your alternative position?


MR SCHMITKE:  By preserving it.  If I can take you to - - -


VICE PRESIDENT HATCHER:  You've kept all power tools and steel tapes, item (vi).


MR SCHMITKE:  Yes.  Item 5 in our determination which deals with a recast expense related allowance, we call it.


VICE PRESIDENT HATCHER:  You still deleted (vi) in the alternative position entirely?  Then (vii) has become (vi)?


MR SCHMITKE:  Yes, that's correct, yes.


DEPUTY PRESIDENT HAMILTON:  The alternate position essentially is this, that you've taken out protective clothing, but left tools.  Is that the difference between the two?


MR SCHMITKE:  That is the difference, yes.  And again, this is not to get rid of it entirely, this is to get rid of confusion.  That's the mischief here.


VICE PRESIDENT HATCHER:  Then both from the primary alternative you've taken out (viii)?




VICE PRESIDENT HATCHER:  And you've taken out (c)?


DEPUTY PRESIDENT HAMILTON:  Well, (c) is of a different nature, isn't it?  (c) is an obligation on the employer to provide certain things.  (b) is a statement that certain protective equipment, or whatever is not included within the allowance in (a), so it's a different thing, isn't it?


MR SCHMITKE:  It is a different thing, yes, that's right.  But it still is the cause of the problem that we seek to address.  What is the purpose of (c)?  What would the purpose of that provision be?  If it's not to regulate work, health, safety matters, and that seems to be the position of many of the other parties in this matter, and it's to establish an allowance.  Well, what's this particular provision do?


VICE PRESIDENT HATCHER:  I think we've done (c).


MR SCHMITKE:  Yes, we've done (c).


VICE PRESIDENT HATCHER:  So (d), you want to delete that in a primary position, but keep in the alternative position.




VICE PRESIDENT HATCHER:  So what's the issue with (d)?


MR SCHMITKE:  This is a multi-faceted issue.  I was going to turn to this clause shortly.  But essentially, we have a situation again, which starts from the wrong position.  It assumes that an employee is going to provide their own boots.  Then it says - - -


VICE PRESIDENT HATCHER:  I don't know much about constructions.  That often happens, does it?


MR SCHMITKE:  Yes, and in fact - - -


VICE PRESIDENT HATCHER:  I see workers on the train with their safety boots.


MR SCHMITKE:  Correct, and in our alternative, we've actually recast this particular provision.


VICE PRESIDENT HATCHER:  In your primary position, you want to delete it.


MR SCHMITKE:  That is the primary position.




MR SCHMITKE:  Because we say that it regulates the work, health, safety matter and that is not an appropriate – or an award is not an appropriate instrument to set this, particularly when you've got all these other layers of regulation.


VICE PRESIDENT HATCHER:  What other layer of regulation provides for reimbursement of the cost of providing safety boots?


MR SCHMITKE:  Well, as we discussed last week the regulation doesn't actually accommodate that at all.  But as your Honour has identified - - -


VICE PRESIDENT HATCHER:  But that's the point, isn't it?


MR SCHMITKE:  That's right, but as your Honour has identified, there are some times when you think what's more convenient for an employee for an employee to provide their own equipment.  This is the prime - - -


VICE PRESIDENT HATCHER:  I assume employees don't want to have a range of safety shoes in various sizes that they've bought for whoever turns up at the site.


MR SCHMITKE:  The phrase one size doesn't fit all, never been more appropriate.  But one size doesn't fit everyone - - -


VICE PRESIDENT HATCHER:  I think we agree that it's desirable in some circumstances for employees to provide their own safety boots.




VICE PRESIDENT HATCHER:  If you delete the allowance, how do they get reimbursed?


MR SCHMITKE:  By virtue of the fact that have an obligation for an employer to provide this type of safety boot that exists within the regulations generally.  It's the employer's obligation to provide any type of PPE.


VICE PRESIDENT HATCHER:  But we've just established they don't provide it, the employee provides it.


MR SCHMITKE:  That's inconsistent with what the regulations say.


VICE PRESIDENT HATCHER:  From now on, if we take out this clause, employers will be providing everyone with their own safety boots.


MR SCHMITKE:  No, your Honour, that's not the case.




MR SCHMITKE:  If I could take you - - -


DEPUTY PRESIDENT GOSTENCNIK:  This is the effect of (d) to require the employer to provide safety boots because it operates instead of (b)(viii) and the obligation to reimburse where the employee provides, only applies to those matters under (b), that is (i) through (viii), not (c) or (d).  (c) and (d) are not reimbursable matters.


MR SCHMITKE:  (c) and (d), if it's not a reimbursable matter, then - - -


DEPUTY PRESIDENT GOSTENCNIK:  It seems to be the logical reading of paragraph (b) which refers to the following tools, that is the following (i) through (viii), not (c) or (d).


MR SCHMITKE:  Yes, but then that begs the question, your Honour, what is (c) there to achieve?


DEPUTY PRESIDENT GOSTENCNIK:  It gets back to the earlier question, where is the power under the Act to include those two terms?


MR SCHMITKE:  There isn't one.  We say it should be deleted.  Perhaps if I could take your Honours and Commissioners to the draft determination on this clause and it would be on page 5 of the copy that you have.


VICE PRESIDENT HATCHER:  Which one – the alternate?


MR SCHMITKE:  The alternate position.


DEPUTY PRESIDENT GOSTENCNIK:  You've left it in there.


MR SCHMITKE:  I've recast it, yes.  And I've made it clear that the starting proposition is that the employer needs to provide the footwear and that where an employee provides their own, well, they may request an allowance to reimburse them.  The rest of the otherwise operative provisions regarding - the existing section regarding the timing for which or timing in which employees can make a request, the amounts, the quantums, even the existing prescription that says how much it is per week and in case somebody leaves before the six-month period is up or so forth, well all that's retained, so those elements are retained.


The provision of safety boots is that one area where you'd naturally think it's actually better for an employee to provide their own.


VICE PRESIDENT HATCHER:  Where did you get the $86.09 from?


MR SCHMITKE:  It's an extract from the existing provision on page 39 of the current award.  That clause effectively deals with subclause (i) and (ii).


VICE PRESIDENT HATCHER:  You've taken out the x-ray bit?


MR SCHMITKE:  Yes, that's a separate matter altogether.  Perhaps while I'm on my feet and we're at that point, again, this is a particular prescriptive requirement which has been the subject of other commentary by the Commission in terms of whether or not it may well be a redundant provision.  This is a provision we say fits all of the bills.  It's unnecessary, it's too prescriptive, it's redundant, it's better regulated by work, health, safety laws.


DEPUTY PRESIDENT HAMILTON:  Do the Roben's principles require provision of footwear?


MR SCHMITKE:  Not specifically.  They require provision of equipment for an employee to undertake work safely.


DEPUTY PRESIDENT HAMILTON:  Whatever is reasonably necessary to be safe.


MR SCHMITKE:  Having regard to the situation, that's right.


VICE PRESIDENT HATCHER:  Sometimes foot wear is necessary, and sometimes it isn't.


MR SCHMITKE:  Correct.


DEPUTY PRESIDENT HAMILTON:  It would be case by case, would it?


MR SCHMITKE:  Yes, but as has been observed, in this sector, you see people on the train, on the bus, everyone brings their own safety boots.  I'm not sure – I wouldn't want to get in somebody else's shoes on a daily basis.


DEPUTY PRESIDENT HAMILTON:  It's not a piece of OH&S guidelines that states that footwear is necessary in the circumstances described in your (c)(i) page 5.


MR SCHMITKE:  No, but what I thought is leave the elements undisturbed.




VICE PRESIDENT HATCHER:  I think you're making a big assumption just because you see a construction worker on the train wearing safety boots that he or she has provided their own.  It's common practice in the industry for the employer to buy the safety boots or send the person off to their preferred outlet.  They purchase them, they wear them to and from home.


MR SCHMITKE:  Yes, and this is - - -


DEPUTY PRESIDENT GOSTENCNIK:  I've seen them buy them in K-Mart.


VICE PRESIDENT HATCHER:  K-Mart have safety boots, but they're only Thomas the Tank Engine safety boots.


MR SCHMITKE:  That's right because the point that I would make in relation to that observation is that people do different things, and there's no one descriptive thing.




DEPUTY PRESIDENT HAMILTON:  Have you finished on the allowances, or are you still going?  I know you've been interrupted, I'm sorry about that.


MR SCHMITKE:  No, no, I'm happy to be.  The point I would just make in relation to that subclause (iii) of that same provision regarding the x-ray.  Now, again, and I've circulated to the parties and if we don't have copies, I might hand it up.  It's an extract from a Safe Work Australia guide regarding hazardous chemicals requiring health monitoring.


VICE PRESIDENT HATCHER:  What clause are we up to now?


MR SCHMITKE:  This is 20.1(d)(iii).


VICE PRESIDENT HATCHER:  The x-rays, right.




VICE PRESIDENT HATCHER:  Do you have a copy for Mr Crawshaw?


MR CRAWSHAW:  I haven't had a chance to look at this, but once again, it seems to fall into the category of extra evidence.  There's a general problem with the way my friend is approaching things – and I realise partly, at your Honour's invitation, but we are now faced with submissions in relation to subclause that have not been the subject of written submissions.


We tried, in our written submissions, to deal with each and every subclause that was identified and to do that, it's not just a matter of me or Mr Maxwell responding to something on the run, we take advice from those that have some knowledge of OH&S, like Mr Ayres.  We're faced with the situation now, where my friend's going to extra clauses and indeed, in relation to this, seeking to justify it on the basis of extra evidence.  It does create problems in terms of our ability to deal with these matters on the run.


VICE PRESIDENT HATCHER:  Dealt with them today, but you just make a note of them, Mr Crawshaw.  If there's any particular matter you want the opportunity to make further written submissions down the track, we'll allow that within reason.


MR CRAWSHAW:  I think in relation to these matters, the oral submissions generally, we ask for that opportunity now.  Sorry, the oral submissions on this issue that have taken place today.


VICE PRESIDENT HATCHER:  At some stage, can you just actually specify the issues that concern you and we'll make appropriate arrangements.


What do you want to take us to in this document?


MR SCHMITKE:  If I can take you to page – what's identified at the bottom as page 2, but it's actually a few pages in.  That is because I provided an extract of a document which is over 209 pages, so it's just got the publication details and the introduction.  Then we go to page 1, which is identified as page 1, which is under the subject of crystalline silica and then specifically over the page to page 2.


This is a matter of public record.  This is one of the many multitude of different types of regulation that applies and seeks to address safety matters that is applicable to the building and constructions sector.  There shouldn't be anything new; this isn't anything new.  The basis for which I bring it forth and highlight it to the Commission, is not necessarily to say, new evidence, it's to say, it's completely inconsistent, this is an example of inconsistency.


VICE PRESIDENT HATCHER:  The chest x-ray you mean?


MR SCHMITKE:  Yes.  Safe Work Australia says - - -


DEPUTY PRESIDENT HAMILTON:  Page 2, check chest.  Go ahead.


MR SCHMITKE:  Safe Work Australia say that chest x-rays are required every five to 10 years in the first 20 years of work, unless you've otherwise minimised the risk using other methods set within this document.


The award says that an employee can get reimbursed for an x-ray once every six months, once every six months.  Now that might have been okay 40 years ago, but we now have a specific guidance material that deals with it and creates inconsistency and in fact, the guidance material warns of the risk of having x-rays too frequently because of the potential implication of too much radiation.


This is again a situation where we don't seek to say if an employee gets an x-ray was it worried about a potential problem as a result of an exposure to crystalline silica which is commonly associated with refractory work about which this clause applies.  Then we're not saying we're not going to get reimbursed - - -


VICE PRESIDENT HATCHER:  How old is this provision?


MR SCHMITKE:  It can go back to any of – well it certainly isn't in the pre-reform instrument, in the old National Building and Construction Industry Award 2000, and I seem to recall it was back in the 78 Award, but I can take that on notice.


VICE PRESIDENT HATCHER:  It's even a pre-Medicare provision.


MR SCHMITKE:  Yes, probably.  And certainly, research has moved on.  This document makes reference to a whole raft of other international research that has taken place which has informed this document and it demonstrates - and it's one example of where there's an inconsistency there.  The award hasn't kept up.  So again, if you're a participant in the sector - - -


VICE PRESIDENT HATCHER:  You're saying, are you, that three provides for something that's prima facie, unsafe.




VICE PRESIDENT HATCHER:  Based on this piece of evidence.


MR SCHMITKE:  Prima facie - - -


VICE PRESIDENT HATCHER:  Safe Work Australia publication.


MR SCHMITKE:  That's right.  And, it's an example of what the sector faces.  Again, I don't want to run the risk of creating an impression that we think this is an allowance which is unreasonably paid.  Of course, it's reasonable to reimburse the employee, if you ask them, as part of maintaining a safe system of work, please go and get yourself looked at by a doctor and that might involve a chest x-ray to determine whether or not the work you're undertaking has in some way, shape or form, caused a detrimental health effect.  It's appropriate an employer requires that.


It's just the award clause and what the requirements are, don't match.  Don't match.


VICE PRESIDENT HATCHER:  That's the six months, but what about, for example, the second sentence.


DEPUTY PRESIDENT HAMILTON:  For refractor brick work and tuberculosis.




DEPUTY PRESIDENT HAMILTON:  Are those special cases?


MR SCHMITKE:  That's what the current provision is limited to.


DEPUTY PRESIDENT HAMILTON:  Are those, in fact, special cases according to current medical opinion?


MR SCHMITKE:  There is a link between exposure to silica dust which is generally associated with cutting into refractory bricks, and that potential exposure, makes you more susceptible to tuberculosis.  That's probably why that provision is there.  Go and get an x-ray because you could well - - -


DEPUTY PRESIDENT HAMILTON:  Does this document deal with that anywhere?


MR SCHMITKE:  It does, yes.


DEPUTY PRESIDENT HAMILTON:  As a general statement, page 2, is there some special case for refractory brick work referred to in this publication?


MR SCHMITKE:  No, there's not, no.  In fact, that's why we would say that this clause should go, because if the employer sends someone off to get tested, well it's their responsibility to pay for it.  If the employee incurs a cost, well they should be reimbursed.  If they go off and time off during working hours, that should be time worked.  That's fine.  It may well be that that provision should survive somewhere, but - - -


DEPUTY PRESIDENT HAMILTON:  You haven't proposed an alternative, you've just deleted this on both versions, haven't you?


MR SCHMITKE:  Yes, because it should be – it's manifesting on its face, something that an employee knows and that parties know, particularly with this performance based approach to ensuring safe systems of work, should occur. You can't require an employee to do something during hours at the direction of the employer and expect that it's not counted as time worked or that expenses incurred are not going to be reimbursed.


VICE PRESIDENT HATCHER:  This doesn't happen at direction.  Leaving aside the point about whether x-rays represent contemporary treatment, it seems to be read on the basis that an employee seeks the medical analysis and then has it reimbursed and the employee can do it during working hours and have it reimbursed.  It's not about employer direction.


MR SCHMITKE:  That is the case, but it should be about employee direction, because if an employee looks at this clause and thinks, does this mean I need to get tested every six months, I better go do it.  That's not actually what Safe Work Australia says.


VICE PRESIDENT HATCHER:  You've made that point, but I'm just raising the broader point now.


MR SCHMITKE:  There is a distinction, yes.


VICE PRESIDENT HATCHER:  About reimbursement of cost of medical analysis to deal with a particular risk in a particular occupation.


MR SCHMITKE:  It would be our view that if an employee takes steps of their own accord, which aren't required by the employer, well good for them.  If the employer requires it, and they should, then they should pay for the cost incurred.  There is nothing that would stop, in fact, an employer and employee dealing with something like this in another type of instrument such as an enterprise agreement of other policy or procedure document that might be applicable at a work place.  It's not necessary for the award.


Lastly, the last sentence of that provision talks about an employee who ceases working in a tuberculosis home or hospital, may also request an x-ray on the cessation of work.  But these hospitals and homes don't exist.


VICE PRESIDENT HATCHER:  Don't exist, yes.


MR CRAWSHAW:  We can say to that, just so we don't have to spend too much time on this, we can say to that at paragraph 34.


MR SCHMITKE:  Yes, and I do acknowledge that.  I do acknowledge that, but again, I use that particular provision just to highlight some of the inconsistencies.


VICE PRESIDENT HATCHER:  The next one is 20.3(a)?


MR SCHMITKE:  This is again a compensation or a reimbursement for an expense related provision, or what had previously been described that way in the 2012 proceeding.  This provision talks about employees who use clothes, spectacles, hearing aids and tools which have been accidentally spoilt.  Accidentally spoilt - I emphasise those words - by acid, sulphur or other deleterious substances via molten metal or corrosive substances, must be paid an amount to cover the loss by the employee and may be agreed.


VICE PRESIDENT HATCHER:  But not to the repair of one's ear if their hearing aid has been damaged.


MR SCHMITKE:  If you're hearing aid is damaged because it's been hit with molten metal, then I suggest there is a bigger issue of concern, at play, and that would represent a situation where an unsafe workplace practice has taken place.  There's been a breach of the law somewhere.  And again, this is one of those provisions which contemplates a situation that shouldn't happen.


If it's going to contemplate a situation where tools are damaged or PPE that might be provided by an employee is damaged in the course of their employment, well make it general to say it's a reimbursement provision, and clarify that it's not limited to these circumstances.  Because right now, you could say well hang on, did your spectacles get damaged by acid, corrosive substances, molten metal – no.  Well, I'm not going to replace them.  That's the logical, at the same time, reading of this provision.  If it is to be considered a reimbursement related provision, well then make it clear that that is the case.


Our primary position says that is shouldn't be there.  But the alternative position says well, if you're going to do it, and the Commission has identified in the past, as have many of the other parties, that this is about allowances and establishing trigger conditions, for the entitlement of that, well then make it clear.


VICE PRESIDENT HATCHER:  Where's the alternative position?


DEPUTY PRESIDENT HAMILTON:  You're just saying you're your alternative is just to make it a general provision, is it?




DEPUTY PRESIDENT HAMILTON:  It's not just safety, it's also transport and loss?


MR SCHMITKE:  Sorry, your Honour, it's at the bottom of page 5 and it just talks there about the compensation of tools again.


VICE PRESIDENT HATCHER:  Why do you exclude clothes from that?  I mean, I understand the way you've restructured it, but why do you exclude clothes as something that you can't be reimbursed for, when damaged?


MR SCHMITKE:  Because arguably, clothes, as we canvassed earlier, could well be PPE and could just be clothes.  But you'd suspect that if someone was undertaking work involving molten metal - - -


VICE PRESIDENT HATCHER:  I don't understand the logic of it, that is, if in (a), if there's a reimbursement for loss of tools by fail or breaking and entering, not securely stored, et cetera, why would you exclude clothes from that?


MR SCHMITKE:  That is in fact a replication of the existing provision.


VICE PRESIDENT HATCHER:  Okay, but it has clothes, doesn't it?


UNIDENTIFIED:  Yes, it does.


MR CRAWSHAW:  The alternate position deletes (a) completely.


VICE PRESIDENT HATCHER:  I understand it deletes (a), but I'm just looking at (b).  So, (b) has tools or clothes and you've deleted clothes.  I'm just not following the logic of that.


MR SCHMITKE:  Because again, well in fact, I wouldn't be opposed to reinserting that back in.  I removed the reference to clothes and protective equipment to clarify what it is and what it's not for, so there was no capacity for the parties or participants to be confused.


VICE PRESIDENT HATCHER:  Right, then 21.3.


MR SCHMITKE:  21.3, this is a matter that is the subject of a claim elsewhere and it's to do with underground allowance and again, the primary position is that it risks creating the impression of danger money and should be deleted, but of course if it is merely to establish an entitlement to an allowance or a disability allowance, well then it should be specified as a disability allowance and it should be very clear that it rewards users.  In fact, the alternate position retains that element.


VICE PRESIDENT HATCHER:  What have you deleted?


MR SCHMITKE:  We would delete that provision in its entirety.


VICE PRESIDENT HATCHER:  The alternative seems to be the same, doesn't it?


MR SCHMITKE:  That's right, yes.  The alternative hasn't changed, because again, it's about – look, the words in the alternative, I should advise the Commission, may not be the perfect words, and in fact there could be conditions being described which don't exist.  I left that in just because I'm not out there doing underground work.  I can't necessarily describe the conditions that would be associated with that disability, but if it is disability related, make it clear that it is disability related.


VICE PRESIDENT HATCHER:  Then there's 21.9.


MR SCHMITKE:  21.9 again, the primary position is again, runs the risk of being seen to be danger money.


VICE PRESIDENT HATCHER:  What's a cofferdam?


MR SCHMITKE:  That's a question actually I can't answer, your Honour.  But what I can say, is that it talks about where employees are not under air pressure and where they are under air pressure.


VICE PRESIDENT HATCHER:  I don't quite understand the relationship between air pressure and a cofferdam.


MR SCHMITKE:  I'm sure my friends at the other end of the Bar table will be able to specify, but our concern was with the impression created by that clause.  In the alternate position, it's retained.  Because it's not appropriate that I describe or set the particular disability conditions.


VICE PRESIDENT HATCHER:  Then we get to 22.2 and you've deleted almost all of those.


MR SCHMITKE:  That's correct.  Again, the deletion of those are based on the general proposition that there is already an overall allowance applicable to the sector for the general types of work and the conditions under which that work is performed in climactic conditions and so on.  It compensates employees for working in all sectors.


VICE PRESIDENT HATCHER:  The effect of the current clause is that these matters are not included in the industry allowance.


MR SCHMITKE:  That's right, but they're still a special rate that's applicable to a (indistinct) sector and the risk again, is the danger money risk.  Again, we would say that if an employee is working in these types of conditions, then it's up to the employer to provide the equipment necessary for that work to be performed safely.


VICE PRESIDENT HATCHER:  But these clauses are about the disability payments; they're not about safety, are they?


MR SCHMITKE:  That's how your Honour may read that clause, but again, I'm contemplating this through the lens of the sector and small business in particular.  So, it has been retained in the alternate position.


COMMISSIONER GREGORY:  Mr Schmitke, is your principal position appears to retain subclause (e), what's the reason for that?


MR SCHMITKE:  Subclause (e), that's clearly disability.  In fact, if you look at the existing provision in relation to that particular clause (iii), subclause (iii) 22.3(e)(iii), it actually defines, and this is another problem in the industry.  It actually says it's in recognition of the disabilities.  That's the issue.  Elsewhere, there's not such a prescriptive requirement, it's not so clear.


VICE PRESIDENT HATCHER:  Now we've got the boatswain's chair again.


COMMISSIONER GREGORY:  Doesn't that go to the same issue though that you've referred to previously in that you've described as payment of danger money, isn't it in a similar category?


MR SCHMITKE:  Arguable it may well be in a similar category, but what distinguishes it, is that there's a provision that currently makes it very clear what it is payable for and that isn't necessarily, and I'm not saying it's always – there's no other provisions, but it's not always as clear as it is in this particular subclause.




MR SCHMITKE:  Yes, that is a matter in the primary position that we have sought to remove; in the alternate position, it's retained.


VICE PRESIDENT HATCHER:  That's a disability allowance recognising it's unpleasant to have to work in protective equipment, is it?


MR SCHMITKE:  Yes, that's right.


VICE PRESIDENT HATCHER:  What's wrong with that?


MR SCHMITKE:  Nothing's wrong with that in terms of the alternate position.  In terms of the primary position, the argument is that an employee shouldn't be given additional money because they're employer has provided equipment so that they can undertake work safely.


VICE PRESIDENT HATCHER:  It's not the safely, it's unpleasant.


MR SCHMITKE:  In relation to (k)?




MR SCHMITKE:  Well, you can't undertake that type of work unless you're using the equipment.


VICE PRESIDENT HATCHER:  I understand that, but isn't it a disability allowance recognising that it's unpleasant to have to work in protective equipment?


MR SCHMITKE:  Yes, you're right, your Honour.  In terms of – and in fact, if I can take you to the alternate position and now I take you page 13 of item 7, where I've deleted clause 22 and replaced it.  Let me take you to proposed subclause 22.1(e).


DEPUTY PRESIDENT HAMILTON:  You've put in there a specific recognition of disabilities?


MR SCHMITKE:  Effectively it says, what is – it clarifies, why is this additional money being paid.


VICE PRESIDENT HATCHER:  Then have you kept all the existing payments after that, have you?


MR SCHMITKE:  By and large, yes.  In fact, there's one or two other minor changes, but by and large, the provision is retained.


DEPUTY PRESIDENT HAMILTON:  The purpose of the alternative is just to clarify that these are disabilities?


MR SCHMITKE:  Yes, to avoid that confusion.




MR SCHMITKE:  Essentially, with the alternative, unless it's very specific about PPE or safety, and it can't be read anything other than that, then it's retained.


Your Honours and Commissioners, we've effectively gone through - - -


VICE PRESIDENT HATCHER:  Is that everything?  Then you get into 22.3.  What have you done with that in the alternative position?


MR SCHMITKE:  I understand that it's been largely retained.


VICE PRESIDENT HATCHER:  Are there any changes at all?


MR SCHMITKE:  I do not recall – I don't recall if there was any – no, sorry.  There is a change in relation to what is currently item (i)(ii) which a provision that talks about a particular different amount of money, depending on the pitch of a roof on which an employee is working when engaged in roof repairs.  The alternate position simply just retains the first provision.  Height of over 15 meters, paid the additional 2.9 per cent.  That's clearly disability.


It cannot be necessarily said, that working at a 45-degree angle or 30 per cent angle was going to bring about a different disability related issue.  If it brings about a work, health, safety related obligations, well then, that's the employer's responsibility to deal with.




MR SCHMITKE:  Then, if I can also - the next item (l)(i) is retained.  The existing provision has two subclauses in it.  The first talks about painters must be allowed a 15-minute spell in the fresh air and then a direct quote "a spell in the fresh air at the end of each hour worked".




MR SCHMITKE:  It's on page 53 of the existing award.


DEPUTY PRESIDENT HAMILTON:  Page 19 of your alternative.




DEPUTY PRESIDENT HAMILTON:  Are these all disabilities as well, or what are they?


MR SCHMITKE:  Again, we would say that that is essentially a provision that currently regulates a matter which is best left to work, health, safety regulation.  If that's not the case, then we would say it is essentially a disability requiring the addition of, or the payment of particular additional rates of pay.


DEPUTY PRESIDENT HAMILTON:  You haven't put in the statement that it's a disability compared with the previous clause?


MR SCHMITKE:  Yes, that's right.  Because in this particular clause, there are different circumstances.  The earlier clause is mainly concerned with the types of disability and this is more concerned with other types of matters.  These could well be – and they are a combination of potential skill and disability.


MR CRAWSHAW:  Sorry, I just lost track of which clause we're doing.


DEPUTY PRESIDENT HAMILTON:  I can see (l) would be a disability perhaps, whereas certificate allowance might be a skill.  I don't know.  So, what are you saying?


MR SCHMITKE:  Yes, that's right, stipulated allowances.


DEPUTY PRESIDENT HAMILTON:  Some of them are skills, some of them are disabilities.


MR SCHMITKE:  Yes, that's it.  Just some.




MR SCHMITKE:  In other clauses, it's clear that things might be a skill related.  Others, it's expense related reimbursement for clearly disability.  This particular provision covers across all three.


DEPUTY PRESIDENT HAMILTON:  Then why don't you put all the disabilities in one clause?


MR SCHMITKE:  Well, your Honour, in the time available to me.




MR SCHMITKE:  After several earlier versions of a draft, I just decided to redraft the existing clause as an example of how I was going to approach my members.


DEPUTY PRESIDENT HAMILTON:  You've changed the existing structure.


MR SCHMITKE:  Yes, I have, but of course, I make that comment subject to our other claims regarding the structure of the award and the allowances and group more broadly.


MR CRAWSHAW:  If I could just inform your Honour, that there is agreement to that at earlier stage that all the disabilities should be grouped together.




MR CRAWSHAW:  There was agreement on that proposition.




MR SCHMITKE:  I'm not sure that that's the case.  I think it was only in respect of – there was a without prejudice consensus.  I think the CFMEU's submission might even make reference to that.  But what I would say is the parties aren't terribly good at reaching agreement.  In fact, it seems to be that avoiding it, is something pursued at all costs.  What I could say is that whilst there was a broad consensus in terms of grouping, what allowance went into what group, I think might still be unresolved and to that end, there was also other propositions regarding grouping that weren't necessarily based on the skill, disability or experts.


VICE PRESIDENT HATCHER:  These discussions, were they assisted by the Commission?


MR SCHMITKE:  I'd say yes.


VICE PRESIDENT HATCHER:  Ms Hogg is nodding.  It would be pointless to pursue that any further?


MR SCHMITKE:  No, I'm the eternal optimist, your Honour, and I think that's a sensible outcome, but there is this issue of if we go by type of allowance and skill, disability, expense.  Or whether we go by grouping of particular occupational allowances.  There's merit to both, but in the context of this particular part of our claim, the parties had, in the past, recognised that it's kind of a, bit of an exercise in futility to look at provisions to group those particular allowances given that they're all subject to claims that we've passed in the primary position.


VICE PRESIDENT HATCHER:  Given the difficulties in reaching agreement, wouldn't it simply be easier for the Commission to do a draft list and then you comment?


MR SCHMITKE:  That's exactly right.  In fact, this morning - - -


DEPUTY PRESIDENT HAMILTON:  I mean, as a general rule, I suspect you may never reach agreement.


MR SCHMITKE:  I suspect you might be right.  But, in fact I was wanting to hand this up, but in recognition of the comments last week, I did in fact have a crack again, at a determination that has grouped these matters.  But of course, I was loath to hand them up, given that I didn't want to necessarily spend the Commission's time going through each and every one of an exhaustive list.  But that would be the way we would do it.  But there are other ways we can do it.


VICE PRESIDENT HATCHER:  Beyond 22.4, which I think probably falls into the same category as you've described, your primary variation then moves onto different matters.  Is that right?  It goes onto the RDO issue?


MR SCHMITKE:  Yes, that's right.


COMMISSIONER GREGORY:  Mr Schmitke, can I just ask in regard to the brewery.  You're using the brewery cylinders, the painter and a brewer cylinder as an example.  The award I presume, tries to set out what might be a safe system of work for a person operating in that environment.  Your secondary proposal at page 19, obviously now just treats that as a disability.  In terms of what should be a safe system of work for that type of activity, you're saying that an employer would need to go somewhere else to find that out, and that is to the appropriate safety provisions in regard to that.


MR SCHMITKE:  Correct.  That is exactly the case and I don't recall that the award specifically tries to set a safe system of work regarding this type of - - -


COMMISSIONER GREGORY:  It currently provides for a 15-minute break each hour.




COMMISSIONER GREGORY:  I presume that's what back then, was thought to be a safe system of work.


MR SCHMITKE:  That is the presumption, yes.


COMMISSIONER GREGORY:  You're saying now, your secondary proposal doesn't deal with safe systems of work at all, it just treats that as a disability.  If you want to find out what a safe system of work is for a person working in that environment, you look elsewhere.


MR SCHMITKE:  No environment is the same.  The nature of the work, health, safety laws, are such that it's probably inappropriate to start prescribing particular detailed provisions such as this.  It might not be appropriate for somebody to take a 15-minute spell at the end of each two hours, or it might be appropriate that they take one every hour.  That's going to be dependent on an analysis undertaken of that workplace and that work at that time on that project, with a view to minimising risk appropriately, having regard to those circumstances.


VICE PRESIDENT HATCHER:  Have we finished with the allowances issue?


MR SCHMITKE:  Only simply to say that this alternative is an example of how they might be grouped, and as I said, I was loath to hand this up.  It's not necessary a putative position; I understand that there's contention even amongst the employer groups about potential descriptions of these things.  But it's just by way of example.


VICE PRESIDENT HATCHER:  This is your proposal?


MR SCHMITKE:  Yes, this is my proposal.






VICE PRESIDENT HATCHER:  Thank you.  Did you want to mark the extract from the Safe Work Australia document?


MR SCHMITKE:  Yes, I would.


VICE PRESIDENT HATCHER:  Is there any objection to that Mr Crawshaw?


MR CRAWSHAW:  No, as long as it's recognised as new evidence and we can respond to it if necessary.


VICE PRESIDENT HATCHER:  Extract from Safe Work Australia publication, Hazardous Chemicals Requiring Health Monitoring, be marked exhibit 44.



VICE PRESIDENT HATCHER:  If you're finishing Mr Schmitke, we might take a short morning tea adjournment.  Then after we've done that we'll hear from any employers who are supporting your position and then we'll hear from the unions.


We are now adjourned.

SHORT ADJOURNMENT                                                                  [11.28 AM]

RESUMED                                                                                             [11.48 AM]


VICE PRESIDENT HATCHER:  Is there any employer group which wants to make any oral submissions in support of the MBA's application about allowances?


MS ADLER:  Your Honour, only to support the submissions that the MBA have made.


VICE PRESIDENT HATCHER:  Yes, all right, well, nobody needs to actually say they support it.  I think we know that but it's whether anybody wishes to make a substantive submission.  Anybody in Sydney?


MS PAUL:  No, your Honour.


VICE PRESIDENT HATCHER:  Thank you.  Mr Crawshaw?


MR CRAWSHAW:  We deal with the so-called occupational health and safety, or work health and safety issues and allowances in our reply submission at paragraphs 11 to 52 and I don't obviously intend to repeat everything that's said in there.  But can I just deal at the start with a proposition that has little to do with the actual allowances, but to deal with this proposition, that the Robens said you couldn't have prescription or that any subsequent approach to occupational health and safety and work health and safety taken in the Australian jurisdictions and indeed, in the 2011 review and the model work health and safety legislation and regulations you can't have prescription.  There's nothing put before you to suggest that any of those reports or legislation says you can't have prescription.


Indeed, prescription has continued along with the broad approach, if I can call it that of Robens and Robens of course was followed in Australia, particular in the - - -


DEPUTY PRESIDENT HAMILTON:  Mr Crawshaw, at paragraph 944, your own witness said "Many people would see that as being too prescriptive and it might be inconsistent with a Robens philosophy of performance-based legislation." I think that was your witness, wasn't it?


MR CRAWSHAW:  Sorry, can I just check that?




MR CRAWSHAW:  He's talking about – he's not adopting that approach himself, he's talking about many people.  That could be anyone.  He's talking about I think a specific provision, rather than as a whole.  Putting that aside, if Robens had said this, if the review into occupational health and safety in 2011 had said this, I would have expected it to be put before you.


VICE PRESIDENT HATCHER:  I think the real issue is not about general duties versus prescription, but whether awards should be in that space, to use the expression.


MR CRAWSHAW:  I agree with that proposition, it's just that there's – the MBA's submissions have somehow tried to erect this principle at the start of the thing that you can't have prescription and it's based on what happened in Robens.  I mean, putting aside anything else, and then today it was said that it was unchallenged that Mr Solomon said the award provisions were introduced in the 70's before the new approach in Australia.


Putting aside whether he'd know anything about when they were introduced, he gave evidence about a case, Edwards – and this is in exhibit 3, paragraph 14.  Edwards v National Coal Board that in 1948 in England, introduced the general principle of removing risk as far as reasonably practicable.  The idea that what came out of Robens was something new, is a furphy anyway.  I just thought I'd say that at the beginning.


DEPUTY PRESIDENT HAMILTON:  One issue that arises is the award does have a lot of detailed prescription.  Perhaps that's appropriate; perhaps it isn't.  Assuming it's appropriate, our award is the appropriate vehicle for it, given the length of time it takes to review these things and the fact that they're not reviewed on the basis of OHS alone, but for a whole range of industrial circumstances.


MR CRAWSHAW:  I think the best way I can deal with that is to go to the particular provisions and say, whey they're appropriate in the particular case.  My opening remarks were really to get rid of this veneer of principle that surrounded the MBA's case.


Before going to those particular provisions, can I deal with the evidence, because the evidence is something not addressed in the written submissions and of course it's been elaborated on orally.  The evidence on this issue is essentially found in the statements and oral evidence of Mr Solomon and Mr Ayres.


By its nature, most of that evidence is opinion evidence and in relation to that, can I just take you quickly to our objections submissions which we were invited to return to at the time of making final submissions.  Can I just point out in that document where we deal particularly with Mr Solomon's evidence and in relation to that, you'll recall that I made a similar objection about opinion evidence in relation to exhibit 3, being that statement that Mr Solomon was reading in the witness box and ended up getting tendered.


The particular parts of the submission that deal with so-called experts are paragraphs 4 to 9 of our objections document.  The hallmarks of expert-type evidence is set out in those cases, is firstly, the witness has to be impartial.  Secondly, they must demonstrate how they have a specialised body of knowledge.  Thirdly, the facts and other matters that are assumed for the purpose of giving the opinion must be set out.


Obviously, those principles apply equally to Mr Ayres as to Mr Solomon and we accept that, and we accept that neither witness is impartial.  However, we also submit that the evidence of Mr Solomon should be given no weight because he's not an expert.  The evidence as to his expertise, so called, was the subject of cross-examination.  You'll see at PN490 to 494 that his recent experience in the industry was largely answering to a dedicated safety manager.  At PN495 to 532, his qualifications in occupational health and safety, go no further than doing some courses that lasted no longer than five days or 40 hours.


By way of contrast, as it apparent from exhibit 4, Mr Ayres has long experience dedicated to occupational health and safety and numerous academic qualifications in occupational health and safety of an extremely high standard, including a PhD.  There was also a marked contrast in the way the two witnesses presented in the witness box, with Mr Solomon being a shameless advocate who gave inconsistent evidence, while Mr Ayers presented as a balanced professional whose oral evidence, in my submission, only boosted his reliability as a witness.


In any event, if you look at Mr Solomon's oral evidence, it did not support the basis for the MBA application.  I want to take you just to some of that evidence.  On 3 April at PN676, and this is dealing directly with the allowances question that I was coming to.  Mr Solomon is asked "Can we come back to the question I asked you in relation to the allowances that you set out in your table?" that was annexure A.


"Particularly from clause 20 and 21.  Do you accept that they're disability allowances?  Yes.  They're not work, health and safety allowances at all, are they?  Primarily not.  Well, can you tell me any of them that are work, health and safety allowances?  The work, health and safety allowance is once the damage is done."  I'm not sure what that meant.  Then he's asked "Well, what do you mean by a work, health and safety allowance?  An allowance for someone working in danger, which may be exposed to such elements as a swinging scaffold that could fail, or explosive power tools or toxic substances.  But none of these allowances are given as danger money, are they?  No, but they are not claimed either."


Now, you'll recall there were numerous occasions today when Mr Schmitke, for the first time addressed some of these allowances where his stock answer was they could be seen as danger money.  That's not Mr Solomon's evidence.  He then went on a diversion saying they weren't being claimed.  "No, and the same applies to the special rates in clause 22?  Yes, that's right.  None of them are given as danger money or in return for being at risk to work, health and safety endangerment.  That's exactly my point.  They're in the award, they're there to be claimed.  They're not claimed; they're not regulated against and in my opinion they would be a better fit in the work, health and safety regulation or OHS as a..." and then, your Honour, the presiding member appears on the face of the transcript.


"What do you mean they're not named?  Well no, in my experience, your Honour, there's no one claiming these specific allowances.  You mean no one pays them?  Well, they're not claiming them to be paid.  Just hold on Mr Solomon, just listen to the question and then answer it.  The allowances are payable by the employer.  I don't think they're payable on a claim being made.  Are you saying that nobody pays these allowances in your experience?  To that detail, yes.  To what detail?  To the detail we're speaking about, clause 20, 21 and 22.  Well, you just wouldn't know, would you?  Not specifically no, but I've not been exposed to it in my time in the industry.  It's not your area, monitoring whether allowances are paid or not, is it?  No.  I should note that there is no..."


Can I just jump in at this stage and say this, that there's no evidence from any of the other witnesses, including those in the MBA who are said to be experienced in the area of payment and matters of that kind, to support the proposition that these allowances are not claimed or paid.


Then if I could then take you over to the transcript – that was really a diversion from Mr Solomon agreeing that there was no danger money, which is quite contrary to what is being put by the MBA.  If I could just go over to PN713.  This matter was revisited because this matter of not being claimed was found also in exhibit 3.


"You say at the end of paragraph 14, the fact that breaches of the work, health and safety award allowances are not enforced, makes them all but redundant.  Correct.  That latter comment was consistent with what you said earlier about people don't pay them, and more so, they're not claimed.  Yes, that is correct, that is consistent with what I mentioned earlier.  You've already told us that knowledge of these matters is not the area that you work in – the history of it.  Sorry?  The history of it."


"No, the question of whether these award provisions, whether they be allowances or other.  Yes, that's correct.  It's not an area that you work in, and the fact that they are not prosecuted or enforced maybe consistent with those awards being obeyed.  Do you accept that proposition?  Sorry, I couldn't hear the last part of your sentence.  Sorry, I think I moved away from the microphone."


"The fact that these award clauses are not the subject of prosecutions or that they are not enforced, may be consistent with the fact that they are being obeyed.  It may be or may be the case that people's behaviour are more aligned with the WHS legislation.  I can't weigh that up.  I don't have any statistics."


Then if you go over to page to PN723, "You also say in paragraph 14 the payment of these allowance', you've got it in front of you, in response to clause 14, the award contains a range of allowances that are expected to be paid to employees when engaged in work that in your opinion exposes work to a higher level of risk, which does not make them safe in the workplace.  Do you see that?  Yes.  Are you suggesting the work that is the subject of the allowance of special rates in annexure A should not occur at all because of the health and safety risk?  Not at all."


"My interpretation, the intent of my comment is the fact that they get paid an allowance or are eligible for an allowance to get work in a high-risk activity, doesn't actually make them safer.  My second reference is whereas under WHS legislation, if they do work in accordance with that, you're likely to be safer.  I'm not saying that they're not entitled to be paid, it just doesn't make them any safer.  I understand, so the work which should continue, but the payment, the allowance doesn't make it safer?  Yes, that's correct.  That applies equally to the first aid allowance I take it, that you refer to in paragraph 26.  I'm just reading it, yes, that's correct."


Then at PN746, your Honour, Deputy President Hamilton, in effect put a sum out question to the witness.  "I've got one question, if I could, I have listened closely to what you said.  Are you saying essentially this, that the award clause you refer to don't add to safety, therefore they should be reviewed having regard to that lack of role in safety to see if there's a continuing need for them.  Is that the heart of what you were saying?  Yes, if it, your Honour."


That proposition again from the witness is quite contrary to the submissions of the MBA that suggests that these provisions actually detract from safety in the workplace.  That wasn't what Mr Solomon was saying at all.  Just before I leave the transcript, can I just go back to PN743 and 744, where your Honour, the presiding member was asking questions of the witness.


"As a practical proposition are you aware of any case out in the field where the employer might refer the situation that the employee provides one of those types of tools or PPE and the employer?  Yes, for a smaller – just let me finish – stop interrupting.  Where the employee provides the tools or the equipment and the employer reimburses the cost, that is, can you envisage any situation where the employer might prefer that situation?"  The witness says "Maybe for a small or medium enterprise, perhaps."


He concedes the need for the reimbursement provisions in relation to - - -


VICE PRESIDENT HATCHER:  Sorry, which paragraph is that?


MR CRAWSHAW:  PN743 and 744.




MR CRAWSHAW:  I'll come back to that in a minute.  Other than the opinion evidence, the MBA has presented little evidence of facts, relevant to this issue.  There's nothing by way of probative evidence.  There is evidence, we acknowledge, of an out of date Australian Standard and the irrelevance of TV hospitals.  You'll find that in Mr Glover's evidence at paragraphs 41 to 45, Mr Solomon's exhibit 3, paragraph 10.


These facts are conceded by the CFMEU in our reply submissions at paragraphs 34 and 43, so they don't really take us much further in terms of the issues that we're at logger heads about.


DEPUTY PRESIDENT GOSTENCNIK:  Mr Crawshaw the concern I have is that, well, and no doubt you'll say it's not dealt with in the evidence, but reading a lot of these allowances and having some understanding of their provenance, that I tend to think that they're reflecting work practices that aren't contemporary work practices.  That is, I'm not sure how – to what extent these allowances are expressly engaged with the current reality of working practices in the industry.


MR CRAWSHAW:  I don't know that either, your Honour.  But the reason I don't know it, is because there wasn't any evidence about the matter.  Which is what your Honour predicted I might say.


DEPUTY PRESIDENT GOSTENCNIK:  I mean, for example, is the boatswain's chair a feature of the modern construction industry?


MR CRAWSHAW:  I would have to get instructions on these matters, your Honour.


UNIDENTIFIED:  It is in Hong Kong.


MR CRAWSHAW:  In Hong Kong.


VICE PRESIDENT HATCHER:  So is bamboo scaffolding.


DEPUTY PRESIDENT HAMILTON:  I mean the origins of a lot of these allowances are various disputes and campaigns of past decades and they've stuck around and the language is still the same.  There may be similar modern language, but it hasn't been updated – in some cases, perhaps.


MR CRAWSHAW:  Well, I don't know.  With the boatswain's chair, I don't know whether that's till used in the industry or not.  It may be, I don't – I'm in a similar position.  I can only tell you things that there was evidence about, or things that I've got instructions on.  I haven't got instructions on a lot of these matters, because they weren't the subject of submissions.


I'll take you to the matters – and I'm not going to be lengthy about it.


VICE PRESIDENT HATCHER:  The difficulty is that these things stay in the awards decade after decade because no one – this is not a criticism, but no one takes the effort of examining whether they have any reflection of contemporary circumstances.  So, they just stay there, and they get more out of date and more out of date.


MR CRAWSHAW:  That's if they are out of date.  But if they are out of date – I haven't done many of these exercises, but I've seen enough of the decision of the Commission, to say that's it up to those that are saying it's out of date, to present a cogent case.  If they speak for themselves, maybe you don't need evidence, but these allowances don't speak for themselves in the majority of cases, at least.


One would expect probity of evidence by someone in the industry that these matters are out of date.  Not some generalised submission to the - - -


DEPUTY PRESIDENT HAMILTON:  For example, you could take an approach, which is this, which is that the objective is not remove an entitlement, which would be one of your main concerns, I would assume, but simply to use current language and practices.


VICE PRESIDENT HATCHER:  Say for example the cofferdam worker allowance, that's not to say whether there should or shouldn't be an allowance for work of that description, but whether what's described here is consistent with contemporary working practices, or whether it's just a bit of verbiage that has no practical use.


MR CRAWSHAW:  Well, I don't know.  If there had been a submission, at least a submission about it, put aside evidence, we would have addressed it.  We addressed all the matters, all the allowances, all the subclauses, I should say, that were the subject of submissions.  I'll tell you where we did it, that's what I was about to do, without going in detail to what we say about them.


Really, or in the end, the MBA's submissions, the written submissions, only specifically deal with a small number of the subclauses.  Today, they've dealt with some others orally, and I'll try and deal with them to the extent I can on the way through, but - - -


DEPUTY PRESIDENT HAMILTON:  Say if we wanted to update the language but retain the entitlement of that clause, presuming there is some form of current work practice.  How would we go about that?


MR CRAWSHAW:  If the Commission is worried about that, I think the best way would be one of the members of the Bench to sit down with the parties, with people who are actually experienced in the industry to go through those matters.  I can't see how you can do it as presently – based on the submissions that are presently before you.


VICE PRESIDENT HATCHER:  A more radical solution might be, for example, with the disability allowances to abolish them all and have some compensatory adjustment to the industry allowance and ditto all the various tool and equipment provisions, abolish them and have some adjustment to the tool allowance.


MR CRAWSHAW:  If that option is seriously being put forward, we'd like the opportunity to make submissions about it.  I can't deal with it on the run.


Essentially, we're talking about – in relation to this issue, clauses 20, 21, 22 and there were three subclauses in paragraphs 33 that, one the basis of the MBA's submissions, seem to fall within this territory and they seem to be duplicated in the deletions and – well, not the deletions, but – at least, I don't think the deletions.  Yes, they're also in the deletions, item 33, 34.  I'm just noticing there's 35.5, but I don't think they came into this territory.


MR SCHMITKE:  If I might just interrupt Mr Crawshaw to direct him to the schedule with respect to the matters that we've been dealing with.  Those particular provisions have been listed to be covered in, I think, nine, hours of work provision, which is the ordinary hours of work in compressed air and underground work, which is what those particular deletions go to.  The earlier submission was made with respect, generally, to allowances.


MR CRAWSHAW:  I'll tell you where we dealt with them, because I just noted the – and I'll tell you at the end of this submission where they've been dealt with.  If I could just firstly deal with clause 20.  Clause 20 generally deals with reimbursement to employees for expenditure or loss incurred by employees in relation to their work.  The main attack appears to be on reimbursement for PPE and we say that today.  But in the written submission, the only specific submission was about the x-rays in subclause 20.1(d)(iii) which we deal with at paragraph – I think it's paragraph 34 of our submissions.


The clothes and other matters in subclause 20.3(a) which we deal with at paragraph 37 of our submissions, and in brief, though you'll have to read it all, we say those items, specified in 20.3(a) are not protective equipment.  That's our starting off point.  Just going to the matters that were addressed orally today, there was reference to 20.1(b)(vi) under the heading Civil Construction Employees.  Once again, that's a reimbursement provision.


There was then reference to 20.1 - - -


VICE PRESIDENT HATCHER:  What are mess personnel?  Last paragraph of 20.1(b)(vi).


MR CRAWSHAW:  Roman (vi)?




MR CRAWSHAW:  Mess personnel.


MR SCHMITKE:  Cooks, cleaners too.


MR CRAWSHAW:  Cooks and cleaners, those at the Bar table are telling me.  20.1(c) refers to protective cleaning for toxic substances.  Insofar – my learned friend initially said that 20.1(c) PPE could be reimbursed pursuant to 20.1(b).  I think proper reading shows that that's not correct.


VICE PRESIDENT HATCHER:  What function does the clause do?


MR CRAWSHAW:  I alerts – as I said, this is the first time this matter's been raised with us and alerts us to the need for 20.1(c) to have a reimbursement provision in it.  Either 20.1(b) needs to be redrafted to include 20.1(c), or a reimbursement provision put in 20.1(c).  That's not a problem with - - -


VICE PRESIDENT HATCHER:  As it stands now, it's a simple command to provide that type of equipment, isn't it?


MR CRAWSHAW:  I agree.


VICE PRESIDENT HATCHER:  As it stands now, it couldn't be included in the award.


MR CRAWSHAW:  That's why it should be amended, because clearly, the purpose of 20.1 – sorry, paragraph 20 is to provide reimbursement of expenses.


DEPUTY PRESIDENT HAMILTON:  There's a similar list at 22.4(b) which seems to be a similar command, when I last looked at it.  Page 54 of the award.  It might be the same issue.  I'll stand corrected, but - - -


MR CRAWSHAW:  I was trying to deal with them sequentially.


DEPUTY PRESIDENT HAMILTON:  I'm sorry, it's the same issue, that's all, but come to it – possibly the same issue, I just note it.


MR CRAWSHAW:  Yes.  I'll deal with that later, because it's a combination.  It does provide - -


VICE PRESIDENT HATCHER:  No, it has got reimbursement – I stand corrected, it does have reimbursement.


MR CRAWSHAW:  It does, in roman numeral (i) and in (v).


VICE PRESIDENT HATCHER:  Is it seriously suggested there might be a circumstance where an employee would provide their own respirator and then be reimbursed for it?


MR CRAWSHAW:  I didn't suggest that, your Honour.


VICE PRESIDENT HATCHER:  You're saying it should be amended.


MR CRAWSHAW:  Your Honour is putting to me that I'm suggesting that.  I'm not suggesting that.  My answer is in relation to that, the same as I gave you before, that I don't know.


VICE PRESIDENT HATCHER:  I thought you said the end of that provision drew attention to the need to amend it to make it reimbursement type clause.


MR CRAWSHAW:  Are we going back now to the respirators in both clauses, I think.


VICE PRESIDENT HATCHER:  Yes, I'm sorry.  We're back to 20.1(c).  That begs the question, and it raises itself in relation to other clauses, is that it advances a realistic proposition that there might be a circumstance where an employee would be required to provide that equipment and then somehow get reimbursed for it.


MR CRAWSHAW:  I really don't know the answer to that.  We only have the generality of Mr Solomon's answers that small business type employers might not provide PPE and the employees might provide them and seek reimbursement in those circumstances.  I imagine a lot of these employees who work regularly in doing particular types of work, covered by these clause, might have the equipment, but I can't say either way on it.


VICE PRESIDENT HATCHER:  That's the difficulty.  It seems to me, either as it stands it can't be there, the point has to be changed.  It's a question of what alternative is taken.


MR CRAWSHAW:  What I'm suggesting is, that it's clear that the intention of this clause is to reimburse and the fact – and (c) has another problem in terms of drafting.  I don't know how this happened, I haven't gone through the history, but as I said, these are matters on which we can further address you, because they've only just been raised.  But if you look at (c)(iv) and (v), they're not applicable to employees using toxic substances, they're applicable to bricklayers.  It really should be a separate subclause relating to bricklayers, and once again, it would have to be consistent with the rest of clause 20, would have to provide for the reimbursement for those matters, if the employee provided those matters.


Your Honour is probably next going to ask me, is it seriously suggested that bricklayers provide pneumatic rubber tyred wheelbarrows.


DEPUTY PRESIDENT GOSTENCNIK:  We were thinking that.


MR CRAWSHAW:  I'm sorry?


DEPUTY PRESIDENT GOSTENCNIK:  We didn't ask it, we were thinking it.


MR CRAWSHAW:  Once again, I don't know.  I'm not even sure what a pneumatic rubber tyred wheelbarrow is.  I've got one that blows up – blows up the wheel, is that all it is?  Well it doesn't seem like – you can get them pretty cheaply at Bun... - I won't say where you can get them.  In relation to that clause, we will have to put to you an amendment anything else, and we'd like the opportunity to put further matters relating to that subclause.


I think we'll put a further submission on the history, that somehow the reimbursement that was provided in relation to these matters under the previous award - - -


DEPUTY PRESIDENT GOSTENCNIK:  You're saying it may be a drafting error?


MR CRAWSHAW:  Yes, got lost.


VICE PRESIDENT HATCHER:  Perhaps pneumatic rubber tyred wheelbarrow is required to move the worker whose feinted for the absence of natural ventilation in the workplace?


MR CRAWSHAW:  I don't know what it is.


DEPUTY PRESIDENT HAMILTON:  All right, have you dealt with that?




DEPUTY PRESIDENT HAMILTON:  We can't take that further, can we?  I think we've exhausted the discussion.


MR CRAWSHAW:  Well, we can, but we'll have to put it in writing.




MR CRAWSHAW:  The next matter that was dealt with orally, was the refractory brickwork.  As I said before, the written submission only dealt with roman (iii) of subclause 20.1(d), and we dealt with that at paragraph 34, but now we've been provided with this chemical monitoring document and we'd like the opportunity to putting further submissions on that.


The alternative amendment to paragraph 1 in particular, doesn't seem to me, on the face of it, to change anything.  But, we might further address that in written submissions.


VICE PRESIDENT HATCHER:  Just – so, roman (i) for a refractory bricklayer?




VICE PRESIDENT HATCHER:  Does that mean they provide their own safety boots, and then if you last six weeks you get a payment for it?  Is that what that means?


MR CRAWSHAW:  They don't provide their own safety boots if the employer provides the boots, because - or at least the allowance isn't payable.


VICE PRESIDENT HATCHER:  Let's assume the employer doesn't provide them.  You turn up with your own boots, and if you last six weeks, you get a payment for the cost of the boots?


UNIDENTIFIED:  And make a request.




MR CRAWSHAW:  That seems to be what the amended clause says too, that's all I'd say.


VICE PRESIDENT HATCHER:  What does the second sentence say, or mean, I mean?  Does that mean if you then have to replace the original boots, you get a second payment.  Is that what that means?


MR CRAWSHAW:  That's how it reads to me, yes.


VICE PRESIDENT HATCHER:  Does that reflect the cost of safety boots?  I somehow doubt it.


MR CRAWSHAW:  I'm sorry?


VICE PRESIDENT HATCHER:  Does that reflect the cost of safety boots?


MR CRAWSHAW:  Well, once again, I don't know, but - - -


VICE PRESIDENT HATCHER:  I might have a look at lunch time.


MR CRAWSHAW:  No, but - - -


DEPUTY PRESIDENT HAMILTON:  Presumably these allowances are all updated regularly, aren't they, having regard to cost of living and so on?




DEPUTY PRESIDENT HAMILTON:  There's been a process of updated and review?


MR CRAWSHAW:  As I understand it, yes.


VICE PRESIDENT HATCHER:  It's a CPI thing, is it?






VICE PRESIDENT HATCHER:  The relevant method of adjustment appears to be in 20.4.


MR CRAWSHAW:  I'm sorry, your Honour?


VICE PRESIDENT HATCHER:  The relevant method of adjusting allowances appears I think, at 20.4.


MR CRAWSHAW:  Yes.  That's clause 20.  Can I just say this, that we do rely on Mr Solomon's evidence in this respect, the answers to your Honour, Vice President Hatcher, that there are employers who do not supply such equipment.  It's a general answer, but it's generally applicable.


VICE PRESIDENT HATCHER:  Why is this clause specifically applicable to refractory bricklayers?  What's different about them in terms of safety boots?


MR CRAWSHAW:  I'll have to take that one on notice.  We can put something in writing on that.  But generally, the objection, it seems to be within this clause as a whole, the specification of PPE.  It can't be that the reimbursement is a problem.  Can I just hand to you - - -


DEPUTY PRESIDENT GOSTENCNIK:  It seems that for all other employees, the full cost of replacing or purchasing boots is the benchmark that's under (b)(v) and there's an exception in relation to safety boots for refractory brick workers, and there seems to be a dollar amount specified.  I'm not sure why that is.


MR CRAWSHAW:  As I said, can we take that one on notice?


DEPUTY PRESIDENT GOSTENCNIK:  That's steel toe cap safety boots, isn't it?  Is that any different?


MR CRAWSHAW:  I'm sorry, I'm - - -


DEPUTY PRESIDENT GOSTENCNIK:  It's a different type of boot, isn't it?  That's a steel capped.


MR CRAWSHAW:  Yes, that appears to be the case, but as I said - - -


VICE PRESIDENT HATCHER:  What appears to be the case?


MR CRAWSHAW:  One is steel capped, and the other isn't.  As I said can we deal with that one in writing?




MR CRAWSHAW:  I've just handed to you a decision of the Full Bench, reviewing a number of awards, and you'll see it's not apparent on the face of the extract, but it was the Pharmaceutical Award was dealt with in relation to its clothing and footwear allowance, paragraphs 172 through to 177.  It appears the ambit of the debate was about the form of the clause, rather than its deletion, but you'll see on that occasion the Full Bench reinserted or retained, no reinserted the wording.  I think that means, retained the current wording which was a clause that provided for PPE and provided for its reimbursement to employees in the situation where the employer doesn't supply the equipment.


It might be said well, in this case the PPE specified in the award is more detailed and more specific than that in the Pharmaceutical Award, but going back to what Mr Schmitke said at the beginning, there are nuances in the building and construction industry and there's many specific provisions relating to the building and construction industry.  We agree, in that respect, and we submit that there's no suggestion that the specific equipment, specified in clause 20.1 is not justified in relation to the particular work.  Indeed, we make the broader point that removal of that specification may well lead to such PPE no longer be provided.


Can I then move on to clause 21?  Clause 21, as Mr Solomon agreed, deals with disability allowances.  They're not work, health and safety allowances.  Subject to one provision relating to apprentices, the same can be said of the special rates in clause 22.  Once again, Mr Solomon agreed with that proposition.  Now, the MBA submissions didn't - - -


DEPUTY PRESIDENT HAMILTON:  Which is the exception?


MR CRAWSHAW:  I'm sorry?


DEPUTY PRESIDENT HAMILTON:  What was the exception about apprentices?


MR CRAWSHAW:  It's in clause 22.  Can I deal with that when I deal – I'm coming to it shortly because the MBA's submissions didn't specifically address any of the subclauses in subclause 21, or at least their written submission.  Their oral submissions, insofar as they dealt with any of the subclauses in clause 21, just made a general submission that there may be danger money and that they should be specifically identified as disability allowances.  I've already dealt with the danger money question.  Mr Solomon dispensed with that notion.


But we don't have any problem with these allowances in clause 21 or 22 being expressly identified as disability allowances.


VICE PRESIDENT HATCHER:  One way the argument was put this morning by Mr Schmitke, was that the clauses may require payment for a work situation which is in fact, unsafe.


MR CRAWSHAW:  There's no – that's just an assertion.


DEPUTY PRESIDENT HAMILTON:  The x-rays apparently wasn't just – there was a work safety issue.


MR CRAWSHAW:  I'm going to deal with that in a written submission.


DEPUTY PRESIDENT HAMILTON:  I'm sure you are.  I don't want to interrupt you.




VICE PRESIDENT HATCHER:  He specifically pointed to the height work allowance at (q) on page 50, as an example of that, that his submission was that on its face, it's contemplating an unsafe situation and it's allowing a payment for it.


MR CRAWSHAW:  Yes.  Well, as I say, that's just an assertion.  That's the first time that's been put.  Once again that wasn't in the written submissions.  We'd like to deal with that proposition in writing.  Can I say generally, if the Commission is convinced that any of this work is unsafe, that is subject to an allowance, the Commission should say so and should consider putting it in the award.


VICE PRESIDENT HATCHER:  Should consider putting what in the award?


MR CRAWSHAW:  A prohibition on such work.  If this Commission is of the view that any specific work is unsafe.


DEPUTY PRESIDENT HAMILTON:  Do we have the power to do that?


VICE PRESIDENT HATCHER:  That was going to be my next question.


MR CRAWSHAW:  I think it would be incidental to dealing with allowances.  If you find that an allowance is unsafe, that you should put a prohibition.  Because, the problem is if you take the allowance out, some employer might continue to have its employees do the work, without paying that allowance.  On the present state of the evidence, I don't think you can say that any of these allowances are paid in situations of lack of safety.  And that wasn't what Mr Solomon said.  Mr Schmitke said it, but not Mr Solomon, who was their witness on this matter.


I think we've moved into clause 22.  In the written submissions, there were four specific complaints about clause 22, so I'll deal with them and then come to the oral submissions about clause 22.  Perhaps I should firstly deal with the amendment to clause 22.1 that was only dealt with orally and the amendment is to clause – not clause, to subclauses, or are found in subclauses (e), (f) and (g) in the draft determination.  Subclause (e) is where my friend says that the special rates should be specifically identified as disability.


As I say, as a general proposition, we don't have a problem with the special rates in clause 22 or indeed the allowances in clause 21 being identified as in recognition of disabilities or disability allowances.  We'd like to take under consideration the specific subclause put forward because we're not happy with the wording with the relevant types of work, so we'd like to put a written submission in relation to that matter.


VICE PRESIDENT HATCHER:  At least some of them are probably skill allowances, aren't they?  Like the pile driving and dual lift allowances are more in the nature of skill allowances?


MR CRAWSHAW:  I'm sorry, which ones, your Honour?


VICE PRESIDENT HATCHER:  Page 51, pile driving and dual lift allowances.


MR CRAWSHAW:  It's not being sought that they be deleted.


VICE PRESIDENT HATCHER:  No, but I thought they're special rates which would be subject to this preamble.


MR CRAWSHAW:  I see, yes, it would have to be – well, we'd have to – if such a clause was to go in, or a subclause was to go in, it would have to identify only those subclauses that the MBA has - - -


DEPUTY PRESIDENT HAMILTON:  The MBA provided a list of the clauses.  They claim they're disability clauses.




DEPUTY PRESIDENT HAMILTON:  Have you done a similar list?


MR CRAWSHAW:  We say all of the ones that they've sought to delete are disability allowances.


VICE PRESIDENT HATCHER:  They've classed those two as skill allowances.


MR CRAWSHAW:  I'm sorry?


VICE PRESIDENT HATCHER:  In the MBA's document - - -


DEPUTY PRESIDENT HAMILTON:  They call them skill allowances.


VICE PRESIDENT HATCHER:  They call them skill allowances.


MR CRAWSHAW:  I haven't got that.


VICE PRESIDENT HATCHER:  This is the last document.  You don't have that?




VICE PRESIDENT HATCHER:  This is the last document provided by the MBA.


MR CRAWSHAW:  We weren't given a copy of that.




MR SCHMITKE:  Sorry, we'll make the copies available now that has transpired.  If I can just mention that I indicated at the time the document got handed up, that I was loath to do so, but it was an example, and that there may well be tinkering in terms of the specific nature of the classification of those allowances.


MR CRAWSHAW:  Maybe we'll deal with that document when we're dealing with the wording.


Just returning then to the written submissions of the MBA.  Can I just tell you what they dealt with?  They dealt with 22. – I hope to finish by lunch time, I might say.  Subclause 22.2(d)(ii), dealt with the question of the confined space definition.  We deal with that in our written submissions – our revised submissions at 35 to 36, paragraphs 50 to 51.  Of course, we say, apart from anything else, that the definition in relation to the award goes for the – the definition for the purpose of the payment of the allowance, as distinct from any regulatory purpose, there being disabilities associated with working in a confined space, even if it's safe.


The apprentice provision that I referred to, your Honour the Vice President asked me about is 22.2(e)(ii).


VICE PRESIDENT HATCHER:  That's the boatswain's chair.


MR CRAWSHAW:  Yes, that's the scaffold or boatswain chair.  "An apprentice with less than two years' experience must not use a swing scaffold or boatswain's chair", and that's sought to be at least amended, under the alternate MBA proposal.  We deal with that matter at paragraph 28.  We accept that it can be characterised as a work, health and safety provision.  We submit that it is justified and there's no evidence that's suggested, that apprentices with less than two years' experience should use such equipment.


VICE PRESIDENT HATCHER:  What's a swing scaffold?


MR CRAWSHAW:  What is it?




MR CRAWSHAW:  I don't know, your Honour.  I'd have to get instructions on that.


VICE PRESIDENT HATCHER:  I mean, does anybody use these things anymore?




MR CRAWSHAW:  The people at the Bar table seem to be saying yes.


VICE PRESIDENT HATCHER:  Perhaps you can get instructions and tell me what it actually is.


MR MAXWELL:  Your Honour, you see them on a regular basis, going down the side of building.


VICE PRESIDENT HATCHER:  Cleaning windows.


MR MAXWELL:  When you see people either cleaning windows or cleaning the outside of buildings.


VICE PRESIDENT HATCHER:  Right, thank you.


MR CRAWSHAW:  I'll ask Mr Maxwell to tell you about a boatswain's chair, while he's on his feet.


MR MAXWELL:  Your Honours and Commissioners, a boatswain's chair, is a similar type arrangement but it's only a seat that takes one person and again, you see them going down the outside of buildings, cleaning windows and so forth or in other parts of construction.  But generally, the people wearing the boatswain's chair, also have a safety harness that is anchored to the top of the building.


VICE PRESIDENT HATCHER:  All right, thank you.


MR CRAWSHAW:  The next matter that was dealt with in the MBA's submissions was 22.2(o), that was the matter of the heavy blocks.  We deal with that submission at paragraph 46 and this was a matter that was taken up with Mr Ayers, you will remember in cross-examination.  He deals with that at PN910 to PN938, but I'd ask you to particularly note PN918 that suggested that no matter what mechanical means are introduced at some stage, there's a necessity for the manual handling of the blocks.


The last matter that was dealt with in the written submissions, was subclause 22.4(b).  I'm sorry, yes, the special rates relating to powdered lime dust.  This is the matter your Honour, Deputy President Hamilton asked me about earlier.  That particular subclause is a reimbursement – well roman (i) is a reimbursement provision; roman (v) is a disability allowance.  Roman numerals (iii) and (iv), I suppose might be said to just be work, health and safety provisions, though they could be said to fall in a different category.


Once again, I think there was some reference to the regulations in the MBA submissions.  We submit that these provisions can be specifically justified on the basis that the regulations do not specifically address the facilities and personal protective equipment required in using powdered lime dust.


VICE PRESIDENT HATCHER:  Are you saying the OHS provisions are deficient?


MR CRAWSHAW:  No, I don't.  I say that the specific provisions here can be justified on the basis that the OH&S provisions are general in nature and don't specifically address what's required for powdered lime dust.


VICE PRESIDENT HATCHER:  How are they justified in terms of power?


DEPUTY PRESIDENT GOSTENCNIK:  The reimbursement of the cost of these items, doesn't discharge an employer's obligation to provide, where necessary, personal protective equipment for particular types of work.  For example, if the employee purchased defective equipment, it doesn't discharge the employer's obligation under Occupational Health and Safety legislation.


MR CRAWSHAW:  We're not suggesting it does.


DEPUTY PRESIDENT GOSTENCNIK:  What is the purpose of these allowances, then?


MR CRAWSHAW:  They're to cover the situation that the Vice President asked Mr Solomon about, namely where medium and small employers don't provide the particular PPE and the employee provides it and is required to - - -


DEPUTY PRESIDENT GOSTENCNIK:  Irrespective of whether it's fit for purpose?


MR CRAWSHAW:  Well, if it's not fit for purpose, there will still be the obligation under the work, health and safety, we're not suggesting that.


DEPUTY PRESIDENT GOSTENCNIK:  I think that's the gravamen of the MBA's point and that is that a small employer might provide these, might reimburse, and then consider that they've discharged their obligations.  That's the confusion to which the MBA refers.


MR CRAWSHAW:  Well, there's no evidence of any such confusion.  An employer has an obligation to be on top of all the work, health and safety laws and regulations.  And indeed, the prescriptions in the codes of practice, which are prescriptive.  They're not necessarily enforceable, but they can be used as evidence in a WHS prosecution.


DEPUTY PRESIDENT HAMILTON:  And presumably where an employer provides a reimbursement for the provision of a respirator, the employer would need to, on a regular basis, test the respirator to ensure it's in proper working order and so forth, in order to comply with its occupational health and safety obligations.


DEPUTY PRESIDENT GOSTENCNIK:  Presumably, there's accepted standards for such materials, are there?


MR CRAWSHAW:  I would have thought so, but I don't know.


VICE PRESIDENT HATCHER:  How are three and four justified in terms of power?


MR CRAWSHAW:  In terms of power?  I'd say they're incidental to the payment of the allowance.


VICE PRESIDENT HATCHER:  Why?  Roman (i) and (ii) were perfect without those provisions being there, wouldn't they?


MR CRAWSHAW:  Well, perhaps I should take that on one notice as well.


DEPUTY PRESIDENT GOSTENCNIK:  Item (iv) seems to do no more than restate the employee's general obligation to cooperate when an employer takes steps in relation to compliance with its occupational health and safety obligations.


MR CRAWSHAW:  I think in relation to the matters raised orally, I think we have leave to deal with the question of the height.  Subclause 22.3(i)(ii) and 22.3(l)(i) in the written submission.  Just finally before we finish, can I just given you – in clause 33, I know my learned friend didn't address it, but there were three matters that seem to be the subject of the draft determination which were addressed in the written submissions and they were clause 33.1(c) washing time, which we deal with at paragraph 29 to 32 on the basis that it's an hours of work matter, not a work, health and safety matter.


Subclause 33.1(d) on the question of compressed air, we deal with that at paragraphs 43 to 49 and as I said earlier, we acknowledge that the standard is out of date and our submission at paragraphs 43 to 49 is that it be updated to the current standard.  The last matter is subclause 33.1(e)(iii) and we deal with that at paragraphs 39 to 42 of our written submission.


They're our submissions on the matter, subject to anything we might put in writing.


VICE PRESIDENT HATCHER:  We'll adjourn now and we'll resume at 2 pm.

LUNCHEON ADJOURNMENT                                                           [1.03 PM]

RESUMED                                                                                               [2.11 PM]


VICE PRESIDENT HATCHER:  Mr Crawshaw, I was just going to say, we're going to sit until 5 pm and have a short break at approximately 3.30.  Would the parties be available to commence at 9.30 in the morning?


Yes, right, well that's what we intend to do.


MR CRAWSHAW:  I was just going to say before I finish, could we have two weeks for that written submission, given that we've got Easter.  Also, we'd like to see the transcript because there may have been some other matters that – I seem to recall a number of matters that I was asked questions on where I wasn't able to assist the Commission because of my lack of knowledge of the industry.  I might just check the transcript.  For example, the cofferdam matter.  I'm told that it's not something out of antiquity and it's still current.


VICE PRESIDENT HATCHER:  I don't think it's the cofferdam issue, it's the notion of air pressure is the – I wasn't quite able to connect the air pressure concept with the cofferdam.


MR CRAWSHAW:  We'd like to assist in those matters as much as possible.  Hopefully, despite the Easter break we'll get the transcript early next week and we'll put a written submission in addressing those matters as well as the matters I specifically raised.


VICE PRESIDENT HATCHER:  Is any other union wish to make any substantive submission on this issue?


MR MAXWELL:  Just a couple of quick points, your Honour.  The first point I wanted to make is that there is still an exposure draft process remaining for this award, so a lot of – I mean, any person that's suffered through the exposure draft process and other matters will know that that provides an opportunity to go through awards in painstaking detail and fix up outdated references.  It provides a very useful forum to look at updating provisions without actually reducing entitlements.  To some extent, that is the exact purpose of the process.


I just wanted to draw that point to the Full Bench's attention.  Also, my recollection - - -


VICE PRESIDENT HATCHER:  I don't think anyone is going to get a second go at these allowances once we've finished with them.


MR MAXWELL:  I guess the point I'm making, your Honour, is that sort of will be a second go, because whoever drafts the exposure draft, will probably – I mean, there already there is an exposure draft of this award.  That process will presumably go on.  I mean, God forbid if there will be a plain language process as well.  But the point I'm making is there is still that process to go and my understanding was a lot of the allowance issues in terms of consolidating them et cetera were actually intended to be dealt with as part of the exposure draft process.  That's the arrangement that was reached with Senior Deputy President Watson.  I just wanted to make that point.  I mean, obviously, the Bench can do as it sees fit.


The other brief point was that I think it's telling that there's no evidence from the safety regulator here.  As we know, there's safety regulators in each state.  I believe there's a national body as well.  If it were correct that this issue of the interaction of the onsite award and safety legislation is such a compelling problem, it seems astounding that none of the safety regulators would have been saying something to the Commission, or there would be evidence that there's been reports to the safety regulator and actions have been taken.


I do think that is an important point, because at the end of the day, they are specialists on safety and there is no indication that the safety regulator actually currently has any concern with the terms of the onsite award.  That was it.  Thank you.


VICE PRESIDENT HATCHER:  Thank you.  If there's no other union submissions, Mr Schmitke, anything briefly in reply?


MR SCHMITKE:  Thank you, your Honour, I will be brief.  The submissions of the union seem to be predicated on a misconstrued interpretation of the positions we've advanced.  At no point has anyone said that there is no room for prescriptive provisions in safety laws.  We've simply said that where it does exist and where there is that need, then it's capable of being dealt with in other types of instruments such as the materials I handed up from Safe Work Australia, as opposed to being in this particular award.


In terms of the Robens principle, and there was a lot of submissions made about that, our contention there is, just to be clear, is that work, health and safety laws, as well known is moving away from the prescriptive approach and towards a performance based outcomes approach.  We'd just simply say that the provisions in the award are inconsistent, in not contrary to that approach.  The duties of work, health and safety laws, are to take steps to minimise risk as far as reasonably practicable and that is not an outcome - - -


DEPUTY PRESIDENT GOSTENCNIK:  I think you'll find that the duty is actually to eliminate, followed by, if elimination is not reasonably practical, then - - -


MR SCHMITKE:  Yes.  More appropriately dealt with in those laws, as opposed to this instrument.  Yes, I made, as I was instructed, a submission with respect to the danger money.  But the alternative is premised on that these provisions could be seen as encouraging or representing danger money and that is, in itself, a risk in that it could potentially undermine appropriate steps taken to address safety concerns established by other instruments.


The alternative position is the one to which I spent most of my time this morning, and it's about the perception of these provisions and how they're actually seen by users of the award in the industry.  That is a prime consideration in terms of making sure that this instrument meets and better meets the modern award's objective.


The items that have been the subject of our contention in terms of work, health and safety, and specifically the allowances provisions, are referenced in our submission dated 16 December 2016 at paragraph 2.3.1.  At that paragraph we outlined, with reference to the table the parties have been provided with earlier in this proceeding, during the conference stage.  Every single aspect of the allowances that we say, were the subject of work, health and safety concern.


We have sought in our submissions and again this morning, and interactions with the Bench, to provide examples of those particular problems so that there can be an appreciation of what they are.  If we were to do that process for the entire onsite award, we would have been here for two weeks, providing evidence and submissions, just going through every single clause.


There can be no doubt, and any contention that we've sprung this on the parties or something like that, simply should be rejected.  In fact, the matters we've advanced in this proceeding, are virtually identical of the matters we've advanced in the 2012 proceeding and that were the subject of findings to suggest that they are necessary – or findings to say that there is a reason why they can be in the award.  Our contention now is that they don't meet the objectives and they can be modified.


I should also indicate that the attachment to the witness David Solomon, also outlined a raft of various – in the award the subject of our contention, and I would remind CFMEU that we provided two additional documents, exhibit 8 which dealt with Mr Solomon's statement at exhibit 9, which I understand looks complicated, but that clearly sets out all of the various provisions and the claims that we've advanced with respect to.  In fact, at an earlier stage in proceedings, this table as well, which is an attachment to a 2015 submission, which goes to great lengths to explain exactly our concerns and contentions.


In terms of the evidence, can I just generally refer to the correspondence that covered our list of objections to the CFMEU's evidence.  That correspondence essentially said we don't think that the process involved in this review is one which lends itself to those types of objections.  We would have preferred the approach the Commission has adopted thus far, as far as I can tell, in terms of hearing all this evidence and giving it appropriate weight in the future.  That's the appropriate course to take in this situation.


VICE PRESIDENT HATCHER:  That's the course we have taken, but a submission was made about its weight.


MR SCHMITKE:  Can I say that neither Mr Solomon nor Dr Ayers were called as expert witnesses and the CFMEU say well, so-called experts – use that phrase many times.  We never sought to identify them as an expert and nor did we treat Dr Ayers as an expert for the purposes of questioning.


Lastly perhaps – actually there was one other matter in relation to this concept of claiming allowances versus paying allowances.  There is a case which I've not had the benefit of being able to track down, but it is a decision involving that exact topic and I would seek leave to, when I can obtain the exact detail, make a submission with respect to you about it.  I think it's important to consider in this context, and it was a decision made quite a while ago, but nonetheless, it's a decision I would like to refer to when I have the opportunity to go through it in detail.


The last point I would like to make, is that it seems that some of the union's submissions virtually go to almost supporting some of the contentions that we've put, and that is that if these provisions are allowance based, well then make them allowance based.  Make the clearly identified as a disability or expense or whatever so that there is no confusion and that's the broad consensus or contention we raise with respect to our alternate position.


Lastly, if I can just urge the Commission to reject a notion that's been advanced, that where there is an alleged gap in work, health and safety laws, then the award is the appropriate place to fill it.  That is, essentially, how we got here in the first place.  That is an approach that's been adopted in the past and we know what the result of that approach has been, which is why we're virtually here today.  It probably explains why the Building and Construction Onsite award has got 45,649 words in it, whereas hospitality has got 32,000, retail award 22,000.  It's a completely unwieldy document, largely because of these types of provisions.


Lastly, if I could just – no, that's all I make.


VICE PRESIDENT HATCHER:  Thank you.  The next issue is redundancy.  Who's going to go first with that?  Ms Adler?


MS ADLER:  Yes, your Honour.  In that issues document I think it sets out the two union claims in relation to allowances.  I didn't know - - -


VICE PRESIDENT HATCHER:  Do you want to deal with those now?


MS ADLER:  I'm in the Commission's hands.  It's got the consolidated rate in the communications equipment.


MR MAXWELL:  I apologise, your Honour, I wasn't expecting to deal with them now.  I thought I would be dealing with those when we dealt with the balance of the (indistinct) claim after the distant work.


VICE PRESIDENT HATCHER:  We're dealing with them in the order that they're in the issues document.  They're part of the first issue.


MR MAXWELL:  Your Honour, to the extent that we're dealing with them now, your Honours, and Commissioners, you will recall that when I gave the opening statement that I identified that our claim in regard to the expense related allowances is dealt with on page 79 of our written submission dated 9 December 2016.


In regard to the - sorry, it starts at paragraph 176, the claim that we make in regard to expense related allowances.  The claim we make is fairly simple.  We seek the inclusion in the awards of a communications equipment allowance.  This seeks to deal with the situation where employees are required to use – traditionally the types of communication used on building sites are either hand signals, whistle signals or the use of walkie talkies.  That's where you're moving material around building sites and of course verbal communication between workers and their supervisors and employers.


What we've seen of more recent times is that there is an increase in reliance in employees being required to use mobile phones and indeed, tablets, to assist in the scheduling of work on site.  Notwithstanding that on some remote projects that the evidence is clear, that workers are precluded from using their mobile phones on those sites during working hours.  We submit that where the equipment is being used that if the employees provide such equipment, then they should be reimbursed for the cost of providing such equipment.


In paragraph 179 we refer to the extent to which communication providers are now promoting how modern communication devices can improve productivity on construction sites and we refer to the extent to which Laing O'Rourke, a major construction company in Australia is increasing their use in giving a clear indication to the future direction.


VICE PRESIDENT HATCHER:  Was there evidence of employees being required to provide this equipment?


MR MAXWELL:  We have provided no evidence to that effect, your Honour.


VICE PRESIDENT HATCHER:  What's the problem we're trying to solve here?


MR MAXWELL:  The problem we're trying to solve, is that we are aware of, and we have provided in evidence given to the – I suppose, the problem in programming our submissions and deciding which ones are more important than others.  We haven't provided the evidence, but from our experience we are aware that particularly in regard to companies engaged in, for example, traffic control, there is an increasing obligation on employees to use their own mobile phones to communicate between one stop and go bat and the other stop and go bat.


As I say, we remit that we have not provided any evidence.  We thought this would be one of those matters where we're not seeking change and we're talking about reimbursement where they use their own equipment.  It the equipment is provided by the employer, then there is no cost to the employee.


DEPUTY PRESIDENT HAMILTON:  What about a personal mobile phone that is used once in a blue moon, so to speak, during working hours?


MR MAXWELL:  That's why if you look at the wording that we put forward, it's where the employee is required.  Obviously, there has to be a clear instruction or request from the employer that the employee uses their own equipment.  If there isn't such a request, then it's not something that the employee can turn around to make a claim for.


We just saw that as a way of updating the award, and bringing it into line with the changes that are occurring in the construction industry in the way that people communicate on site.


VICE PRESIDENT HATCHER:  That was only traffic control work you mentioned?


MR MAXWELL:  I mentioned traffic control work.


VICE PRESIDENT HATCHER:  What's AWU work, isn't it?


MR MAXWELL:  I beg to disagree with your Honour.  That is not a point I would regularly concede.  We've had many members engaged in the industry that work in traffic control.


VICE PRESIDENT HATCHER:  Am I wrong to say that at one stage there was a push for a separate award to cover that work?


MR MAXWELL:  There was, your Honour.  There was an application.


VICE PRESIDENT HATCHER:  But it's fallen away.  The three conferences with me was enough.


MR MAXWELL:  Yes, the application was withdrawn.


Your Honours, I don't want to waste time in the Commission today.  That's all I really wish to say in regard to that matter.  Perhaps if I can deal briefly with the second matter before the employers respond.


In regard to special rates, your Honour mentioned previously about whether there was any possibility that the various allowances under the award could be consolidated in either an increased industry allowance or some other method.  We identified it in the 2012 award review, but we withdrew the claim and we raise it again here, is that if the employers are concerned about the various special rates that are payable under the award, then one option would be to allow employers and employees to agree to the payment of what we've called a consolidated special rates allowance.


We've identified in paragraph 180 of our written submission on page 80, that the wording of that type of clause and in a sense, what we're saying is, that this special disability allowance would cover all special rates except for those identified in roman (i).  Those allowances deal with - - -


DEPUTY PRESIDENT HAMILTON:  What's the basis of the 7.9 per cent figure?  Without going into enormous detail.  In a sentence, where did you get 7.9 per cent from?


MR MAXWELL:  If you look under the existing award, there is an allowance that's paid to – just bear with me, I think it's the refrigeration – yes, if you look at clause 21.11 of the existing award, there is an air conditioning industry and refrigeration industry allowance.  That provides for an allowance of 7.9 per cent to be paid to employees to compensate them for the various disabilities and peculiarities associated with - - -




MR MAXWELL:  Sorry, 21.




MR MAXWELL:  See at (a) there was a figure of 7.9 per cent.  In essence, that allows he's paid for the disabilities of air conditioning work and this is in lieu of those special rates identified in (b).


DEPUTY PRESIDENT HAMILTON:  That's applicable generally because?


MR MAXWELL:  That's applicable for - - -


DEPUTY PRESIDENT HAMILTON:  Why are you applying it generally?


MR MAXWELL:  We're not seeking to apply it.


DEPUTY PRESIDENT HAMILTON:  No, no.  That can be used generally across the award, can it?






MR MAXWELL:  We see it as a way of – well, sorry.  It can be applied generally because it's by an agreement between the employer and the employees.


VICE PRESIDENT HATCHER:  Why has that amount got anything to do with some wide application?  Is there a suggestion that there's some particular disability associated with air conditioning maintenance?  I'm not sure what that is, but.


MR MAXWELL:  Your Honour, that allowance there is dealing with people who install air conditioning on multi-storey buildings and if you look at the work that they perform – so for example, when you install air conditioning in a multi-storey building, then you'll be working with insulation around the ducting; that you'll be dealing with hot work because if the air conditioning is running and working at a hot temperature, then it's hot work.


DEPUTY PRESIDENT HAMILTON:  In other words, it's used to substitute for a whole range of allowances for that type of work.


MR MAXWELL:  That's correct.


DEPUTY PRESIDENT HAMILTON:  That can be generally applied, do you think, because it's similar enough?  Is that what you're saying?


MR MAXWELL:  We say it can apply similarly to others.


DEPUTY PRESIDENT HAMILTON:  It's done by agreement?




DEPUTY PRESIDENT HAMILTON:  Where there's some figures?


MR MAXWELL:  In regard to the air conditioning layout, I don't know the history of that.




VICE PRESIDENT HATCHER:  I'm confused.  21.11 says in (b), if you get the allowance, you're not entitled to those things.


MR MAXWELL:  That's right, yes.


VICE PRESIDENT HATCHER:  But your one says the allowances in compensation of all except the following.


MR MAXWELL:  Yes, because those types of allowances that we've identified are ones that are not typically – or those disabilities would not particularly be incurred by other construction workers.  For example, your general construction worker wouldn't be working on a swing scaffold.  They wouldn't be working with asbestos – they are normally asbestos contractors.  They wouldn't be working on a suspended perimeter work platform and in general, they wouldn't be working in an area where the temperature is raised by artificial means or in areas covered by cold work.


VICE PRESIDENT HATCHER:  In that case, how could you possibly apply the 7.9 per cent to that concept?  It's just a different figure for a different set of disabilities.


MR MAXWELL:  Your Honour, we've looked at the various allowances that are contained within the special rates and if you added up the special rates, let's say that may be applicable to a bricklayer, that there are a number of allowances such as heavy blocks.  There is using a brick cutting machine and when you added up those allowances, we've taken an average to arrive at that 7.9 per cent, but also on the basis that there is a similar provision in the award.


VICE PRESIDENT HATCHER:  A suspended perimeter work platform.  Is that just another word for a scaffold?


MR MAXWELL:  That's more akin to a swing scaffold.


VICE PRESIDENT HATCHER:  Swing scaffold.  I see, suspended, yes.


MR MAXWELL:  Sorry, I withdraw that.  A suspended perimeter work platform is where you sit on the outside of a building, you'll see a platform that sticks out during the construction and it's that type of platform that they're talking about.


Your Honour, in regard to again, that was one of those items we saw as not being a significant change, it's more of, I suppose, to coin the words of the employers, a flexibility provision that would allow the employers and the employees to agree on the allowance in lieu of the special rates and then they would not have to deal with the individual items.


VICE PRESIDENT HATCHER:  Leaving aside the amount, why couldn't we make that simply the new provision to replace the allowances, if it's a fair deal?


MR MAXWELL:  Your Honours and Commissioners, you could make a decision to say that in lieu of all the allowances in the award, that you could create a new industry allowances that's paid as part of the employee's ordinary time hourly rate.  That is open to the Commission.  Indeed, to some extent, that is what happens in industry.  If you look at the construction industry at the various enterprise agreements that come before this Commission, you will notice that there is site allowances provided for in those agreements.  Those site allowances are paid in lieu of the special rates in the award, except normally for the multi-storey allowance, I think asbestos removal and there's two or three other allowances.


VICE PRESIDENT HATCHER:  Can you provide an example of one of those allowances.


DEPUTY PRESIDENT GOSTENCNIK:  They're based on the value of the project.  They're industry allowances, or the site allowance increases depending on the size of the project, or the value.


MR MAXWELL:  I can provide a copy in our written reply.




MR MAXWELL:  Your Honour, that's all I have to say on that matter.


VICE PRESIDENT HATCHER:  Any other union submissions about these issues?  No?  Who'd like to reply on behalf of employers?  Ms Adler?


MS ADLER:  Thank you, your Honour.  We made written reply submissions dated 16 March and I'll just briefly make a few comments in response, if I may.  Just dealing with the communication equipment's allowance first, which we deal with at section 3.3 which is page 11 of that written submission.


Can I just briefly say three things in response.  Obviously, we oppose the claim and as the Bench has alluded to, there is no evidence of the need for this sort of allowance in the industry.  The union's submission indicates that it's not a widespread problem necessarily, that most of the time it's dealt with and we just see the provision as unnecessary.


DEPUTY PRESIDENT HAMILTON:  Sorry, which provision is this?


MS ADLER:  The communications equipment allowance.


VICE PRESIDENT HATCHER:  Ms Adler, I'm sorry, this is submissions in reply, is it?


MS ADLER:  It is, your Honour dated 16 March.


VICE PRESIDENT HATCHER:  What paragraph was that?


MS ADLER:  I'm looking at section 3.3 which is page 11, down the bottom.




MS ADLER:  The second point that I make and I make in our written submission is that there's been no contemplation of any unintended consequences by putting a provision like this in the award.  Businesses may have their own policies on these sort of matters and employees may want to deal with these things in their own way, through their own tax treatment of certain equipment and so none of that's been contemplated.  You just throw the allowance in there without thinking about those things.


Finally, we say the proposed provision is inconsistent with other expense related allowances under the award.  Specifically, it doesn't provide a specific amount for the allowance.  In lieu of that, there's no mechanism for agreement to provide an amount of the allowance.  As such, it's near impossible for an employer to predict the amount of the allowance in order to cost it into the day to day running of the business.  They're the three things that I wish to say in response on that matter.


In relation to the special rates allowance, which we deal with in those reply submissions at section 3.4, which is just on page 13.  I guess we say four things in response to that.  Obviously, we oppose the insertion of that.  This was raised during the two-yearly review by the union.  We see it as simply an additional award provision without any practical utility.


At table A to those reply submissions which is page 22, we've got a list of all of those allowances, which would or wouldn't be included in the special rate.  The ones that are in grey, are those which would not be included and the ones that aren't highlighted are the ones that would be included.  It's our submission that there would be a rare occasion where the ones that are not shaded in grey would actually be incurred at the same time.  The actual utility of having a special rate to apply to those allowances that are not shaded in grey, is minimal, so we just see it as an addition.


VICE PRESIDENT HATCHER:  Does that mean the concept would have greater merit if it encompassed a greater range of allowances?


MS ADLER:  Well - - -


VICE PRESIDENT HATCHER:  And again, leaving to one side the quantum issue that is conceptually, is it of any merit if it allowed parties to have the option to roll up allowances into a single amount and simplify the administration of the award?


MS ADLER:  I think there's utility in exploring that.  I think that there are certain allowances that deal with the same subject matter.  For example, there's a number of allowances that deal with working at heights.  Yet there are at hand - -


VICE PRESIDENT HATCHER:  Isn't that possibility already provided for in the award flexibility provisions?


MS ADLER:  It is, your Honour, and we make that point in our written submission as well.






MS ADLER:  From our membership, there are some allowances which are rolled in through individual flexibility agreements and I'll come to that at some other point in our oral submissions.  A lot of these allowances don't necessarily apply to residential construction work.  Multi-rise residential would be a different situation, but for the single dwelling road housing type construction, a lot of these would not apply.


DEPUTY PRESIDENT HAMILTON:  If there was to be a roll up of allowances into a single industry allowance, how would we go about setting the number?


MS ADLER:  I'd have to take that question on notice, your Honour.  And that's I guess, been part of the difficulty in discussions around these allowances, is the quantum.  Every allow – I won't say every allowance, most of the allowances have a different quantum attributed to them and that was also our concern with the 7.9 per cent, is where did that come from and how was it arrived at.  The submission just now, doesn't provide me with any greater comfort with how that was arrived at.


DEPUTY PRESIDENT HAMILTON:  The obvious way is to do a survey or payroll of some kind.  That's the sort of ABS style methodology.  It would have very limiting, but it would be very rough.


MS ADLER:  It's not an easy task.  I mean the other option would be to do an assessment of the variety of rates that are already in the award and see if there's something that can be gleaned from that or some rationale behind why they are already the way they are and work from that basis.  But beyond that, and I think that's probably the sticking point with why discussions around these matters have been so difficult, because the quantum is different depending on which allowance you're talking about.


Notwithstanding that, the claim proposed by the CFMEU, I don't actually think solves the issue that a lot of us have talked about for years, about rationalising the allowances.  It adds another allowance, from our perspective it doesn't necessarily provide any benefit by using that.  A number of the allowances that could be used as part of that 7.9 per cent would not actually be incurred at the same time.  So, you're back to sort of square one, but now you've got an additional award provision in the award.


That's all I have to say in response, your Honour.  Thank you.




MR BOANZA:  Your Honour, if I could also mention that with the CFMEU this idea of having some of these (indistinct) and other allowances included into the special allowance, there is an additional difficulty for the civil contractors in that some of the allowances in that award did not apply to civil construction.  They're broken into allowances that apply to construction, such as buildings, covered by the Housing and Industry Association.


There are also allowances that apply to civil work and of course, if those allowances were to be rolled up into one allowance that goes into the special allowance which applies to everybody, our members would end up having to pay additional money for allowances that they would never be likely to pay in the first place.  We would submit that such a deed would require at least two different sets of allowances, one applicable to civil construction and one applicable to other types of construction.


VICE PRESIDENT HATCHER:  Yes, right.  Any other employer party wish to say anything?


MR SCHMITKE:  Thank you, your Honour, our response to the communications equipment allowance in our March 2017 submission at section 6 on page 10, and we would just simply rely on those particular provisions.  But in respect of the special rates proposition and again, our submission deals with that at clause 7.1.


Being blunt, it's a provision that's designed to fail because it's an individual agreement with an individual employee.  You're going to have a situation where you could have 20 employees on site, 15 are claiming this particular provision five aren't, it's going to create a logistical nightmare in terms of ensuring compliance with the instrument.  You've got different types of employees doing different types of work at different times.


As Ms Adler's pointed out, you've got different quantums that apply to the allowances provisions.  Even where the allowances provisions apply to the same categories of workers, often they're expressed differently.  Sometimes it's part of the day; sometimes it's per hour; sometimes it's per hour or part thereof.  Other provisions talk about time spent undertaking a particular activity that gives rise to the allowance.


It would be impossible to determine whether or not you're complying with the overall obligations under the award by utilising this method and the enforcement of a regulator such as the Fair Work Ombudsman or someone like that would just make this instrument even more impenetrable than what it already is.


DEPUTY PRESIDENT GOSTENCNIK:  On one view, the proposal about consolidation in fact has the effect of narrowing the range of possibilities that are currently available under the award flexibility provision because it exempts the consolidation of certain allowances.


MR SCHMITKE:  Yes, yes, that is one view, your Honour.  That is one of the additional reasons why we would say that we don't support the proposition.




MS PAUL:  Your Honour, I think Mr Schmitke has dealt with the issues that we were about to raise.  I just wanted to add, your Honour, in terms of our group's position around consolidation, it's not one in which we support generally, only because it would inadvertently have potentially an employer paying a consolidated amount for allowances that they may not actually need to pay, bearing in mind the nature of the allowances.


Other than that, your Honour, and that was more to address your Honour's questions or statements around the possibilities of that.  We say that that's fraught with a level of risk or high level of risk.


VICE PRESIDENT HATCHER:  It seems to me that any consolidation concept is going to have winners and losers on both sides, isn't it?  That is, if you proceed on that assumption you'd never do it in any form.


MS PAUL:  Yes, your Honour, except the nature of these type of allowances is, as Mr Schmitke has pointed out, you're having them working part of the time.  It's only when they use – when there's a certain disability or certain disability for the use of a better term, and as such, the ability of actually saying here's a fair, reasonable middle ground, means that whilst yes, there's losers and winners, there's a higher risk that employers end up paying for that.


If at the end of the day it mirrors what occurs in the air conditioning allowance provisions in the clause earlier, I think you'll probably find that there's a level of employers that are paying more by paying the consolidated figure than they are in terms of the individual process.  I think it's more right, from our view, if there is mean to be consolidation, the ability for employers to still choose to pay individual allowances as they choose, but also being able to note that in the award, that the factoring isn't an exact science.


VICE PRESIDENT HATCHER:  Right, thank you.  Anything in reply?


MR MAXWELL:  Your Honour, just briefly.  Ms Adler referring to take away attached to the HIA's reply submission and said the majority of those allowances would have no application to the residential building industry.  I just point out that item 53, explosive power tools would apply.  That will be found in things like nail guns and those type of equipment.  Wet work would apply, that's item 54.  Item 75, cleaning brick work using acids would apply.  Item 76, bagging would apply mainly done by brick layers and plasterers.  Item 79 the dry polishing of tiles would apply.  Item 80, cutting tiles with an electric saw would apply.  Items 82 through 85 that deal with roof repairs would apply in a residential construction industry.  Item 86 that deals with computing quantities would apply in the residential construction part of the industry.  Item 87 the drying stone allowance would apply and 89, certificate allowance would apply and 92, bricklayer operating cutting machine would apply.


That's all I wish to say.


VICE PRESIDENT HATCHER:  All right, redundancy.  Ms Adler.


MS ADLER:  Thank you, your Honour.  Just bear with me a minute while I – just before I jump into the redundancy scheme, there are just a couple of matters that I hope to deal with up front, that came out from discussions last week and also to deal with our survey, as the survey material deals with a number of our claims.  I thank the Commission for providing the Bench with some documents that I sent in over the weekend as well, as I'll be referring to those.


The first matter is just around award coverage in the sector.  Unfortunately, I can't find any information specifically about the residential construction sector but what we have referred to in our written submissions, is the research carried out in the award reliance survey, which is dated December 2013.


I simply point to this to show – obviously, the findings of that report are in relation to the construction sector, so at page 17 of that report.


VICE PRESIDENT HATCHER:  Sorry, which report?


MS ADLER:  It's called Research Report 6 slash - - -


VICE PRESIDENT HATCHER:  Yes, thank you, I've got it.  Page 17.


MS ADLER:  Table 3.7, the fourth line down talks about award coverage by industry and organisational size and there's a line there for the construction sector which shows altogether 20 per cent of those surveyed, were covered by the award.  I would also say that the definition of award reliance used by that research which is on page 5, I understand simply was based on whether or not the minimum rate under the award applied.  So, I would suggest that the award coverage is probably higher than that and if they go over award payments would apply, but that the bulk of the terms and conditions of the award would apply nonetheless.


It's just to give the Bench some context around award coverage in the industry, so far as we can tell.  That's as far as I sought to take that document, your Honour.


The second matters goes to our survey and the unions in their reply submission dated 10 March 2017 and by way of their objections document dated 29 March, have a number of criticisms of that material, which I'd just like to deal with up front now if I can.


If I can say that those criticisms largely fall into five categories.  The first one is around the number of respondents and which award that they're covered by.  We sent that survey out and just for the benefit of the Bench, that material is at attachment A to our submission dated 2 December 2016.  That survey was sent out to nearly 24,000 members across the country.  Obviously, we have very little control over how many members respond to that.  We can only do our best, but obviously, these people are running businesses and are busy and we have little control over how many people respond.


We would say, however, that we managed to get 290 responses.  Of those, 189 were covered by the onsite award and 39 were covered by the joinery award.  We say that information is useful and relevant for the Bench to consider as part of these proceedings.


The second issue raised by the unions is that there are errors in the survey, or errors in the survey questions, and particularly in relation to some introductory paragraphs that precede the question.  If I can take the Bench to annexure A to the statement of Kirsten Lewis.  That's at page 63.  Annexure A is the questions that were sent to members.  On page 64 specifically, the unions criticized the introductory paragraph just under the heading that says agreement / awards.


It says an "An employee's minimum terms and conditions of employment are set out in a modern award."  Now the unions claim that that's wrong and that we should have mentioned the National Employment Standards in that introductory paragraph as well.  I don't think you can say that it's wrong and I think the modern award calls up the National Employment Service, so there was no attempt to mislead respondents to suggest that their terms and conditions of employment were not set out elsewhere other than the modern award.


The next criticism goes to the introductory paragraph to a range of questions about the hours of work.  These are at page 65 and just under the heading that says Hours of Work.  There is set out an explanation of how hours of work under the onsite award are structured.  We say "Under the onsite award, ordinary working hours are to be worked on an RDO system.  This means that in a 20 day four-week cycle, Monday to Friday inclusive, eight hours is worked each of 19 days and with .4 of an hour of each of those days accruing towards the 20th day" et cetera.


The unions claim that we should have referenced clause 33.1(vii) which is the provision which talks about agreements for working other than on rostered days off.  I think that if a business was working other than on a rostered day off system, then the answer to question 13 would have been no.  I would also say that to set out an explanation of every component of that clause 33.1 in the survey, would just be too much for a member to read and they basically switch off.


There was no attempt to misconstrue again, the provisions in the award, we're simply saying this is what an RDO system is, do you have one, yes or no.  If they didn't and if they had some arrangement otherwise, then they would answer no.  I guess in making these points I'm just suggesting that the validity of the survey should be given weight.


The next matter that I just wanted to address is that the unions claimed we should have provided more, I guess, detailed questions in relation to characterising the respondent.  Questions 1 to 12 of the survey deal with identifying matters.  The union set out in their submission some other questions we should have asked.  I mean, I think that's a bit of a subjective assessment.  We felt that the questions that we asked were enough to identify the types of the businesses the respondents were, how many employees they had and it we just took a different view from the union.  I don't know that that submission could be given much weight on the union's behalf.


The other matter raised against our survey is that we have de-identified the respondents and we did deal with this briefly last week, so I won't dwell on it.  Only to say that, 290 people responded.  For us to bring each one of those individuals here to this Commission to give evidence is impractical.  We are an industry association representing its members and we are here to represent their views and getting 290 respondents from members is one way that we can do that.


VICE PRESIDENT HATCHER:  Was there any request to produce the primary data?


MS ADLER:  The notice to produce requested that we provide all materials associated with the survey.  When we provided those materials, there was no response requesting the identification of the respondents.


The final matter is that the unions raised that there are contradictory responses from individual respondents.  I think that there are probably two reasons for that.  The first is that the respondents may not be completely across their workplace relations or obligations under the modern award, so they may have a view of something which is not actually compliant with the award.


VICE PRESIDENT HATCHER:  Page 81 of Ms Lewis' – sorry, it has at page 81 on mine.  So, page 12 of 45.


MS ADLER:  Yes, your Honour.


VICE PRESIDENT HATCHER:  Do your employees currently receive RDOs and two thirds said no, so how does that work?


MS ADLER:  I think some of that comes to light in some of the commentary that businesses structure their working hours how they see fit, depending on their business' circumstances.  Some will work the 38 hours a week without the RDOs.  Some will work 40 hours a week and maybe don't provide the RDOs.  I think that there's maybe confusion about what the award entitlement is.  I mean, that's probably clear on the fact that most of them say that they don't provide RDOs.


VICE PRESIDENT HATCHER:  I'm not clear about this, is there any option under the award as it currently stands to work 38 hours without providing an RDO?


MS ADLER:  Yes there is.  All things being equal, I can assume that that's what they're doing.  That's probably as far as I can take it.


VICE PRESIDENT HATCHER:  You don't need an IFA to do that?


MS ADLER:  No, but when we get to that, there are a lot of members who do use IFAs to structure arrangements when work is performed, including how to deal with the RDO system.




MS ADLER:  The next matter I'd like to deal with in relation to the survey is that in that evidentiary objections document, the CFMEU refers to the penalty rates decision and extracted a few paragraphs in that decision which talked about the weight and the validity of the surveys filed in those proceedings.  One of those documents referred to within the penalty rates decision is a submission of the Busselton Chamber of Commerce and Industry and that's another one of the documents that I asked to be provided to the Bench.  They are the submissions of the Busselton Chamber of Commerce and Industry dated 1 September 2016 and the paragraphs referred to in the penalty rates decision, in 25 to 46 of those submissions.


I guess I provide this to give the Bench some context around the comments made by the union in relation to our survey.  Those comments in that submission, I think there are six businesses that were spoken to.  There's no information in that submission about how that information was collected and I guess I would distinguish that from the materials that we've provided which gives 290 responses with a range of qualifying questions to get a picture of who these businesses are and who these respondents and who their employees are.  In saying that, we would submit that our material should be given more weight than that provided to the information in that penalty rates decision – in relation to the submissions of that Chamber of Commerce and Industry.


The other point I'd just like to make briefly, is that to the extent that the Bench has concerns about the veracity of our survey, then we would agree with the observations made in paragraph 1097 of the penalty rates decision which is also extracted at paragraph 23 of the evidentiary objections document filed by the CFMEU.  We would say that there are methodological limitations to the survey that we can provide as an industry association.  However, we would ask this Full Bench to consider the material, our material, in the same way as the Full Bench did in the penalty rates decision, that to treat the data from these surveys as suggestive or anecdotal rather than definitive and that the responses can be treated more like case studies, and I'm quoting, or anecdotes, "accounts of situations of those who did respond, but not to be taken as representative of the survey population".


VICE PRESIDENT HATCHER:  If you go to page 15 of 45, so I'm still on this RDO issue.  You ask the question, and I've looked at the graph on page 12 and then the question on page 15 is "Is the current requirement to operate an RDO system appropriate for the residential construction industry?"




VICE PRESIDENT HATCHER:  How does that square up with what you said before?


DEPUTY PRESIDENT GOSTENCNIK:  And while you're on it, it's related – I'm struggling to find a provision in clause 33 which allows for taking or working 38 hours a week without an RDO.


MS ADLER:  Let me deal with the second question first, if I may.  33.1(vii) of the award provides for agreement on working other than the rostered day off cycle.  We do have some issues with that provision, so I'll just put that on the record.




MS ADLER:  Seven.  It's page 72 of the award.


DEPUTY PRESIDENT HAMILTON:  Do you say that reflects what question?


MS ADLER:  The question was asked to the survey respondents whether or not their employees currently receive an RDO and most of them said no.  The question is how is that possible under the award which provides for a rostered day off system.  There is an option, albeit a limited one, to work on an alternative system.


DEPUTY PRESIDENT GOSTENCNIK:  Where the employer and the majority of employees agree.


MS ADLER:  That's right.


VICE PRESIDENT HATCHER:  I'm sorry, perhaps I misunderstood your response, because I thought you had indicated that there was a general provision that allowed for the working of 38 hours straight without an RDO.


MS ADLER:  Well, I guess it depends on how far you read that clause, but the majority - - -


VICE PRESIDENT HATCHER:  That would allow it if there was an agreement, but there's no provision which simply allows as an alternative.


MS ADLER:  No, and that's part of what we propose as our variations.


DEPUTY PRESIDENT HAMILTON:  Would the majority of your respondents be small business?


MS ADLER:  They would be, yes.


DEPUTY PRESIDENT HAMILTON:  Is that possibly part of the explanation?


MS ADLER:  As to why they answered no?


DEPUTY PRESIDENT HAMILTON:  Knowing that there's more difficulty in complying with industrial instruments amongst small business without specialist HR staff and the like.


MS ADLER:  Absolutely, your Honour.


VICE PRESIDENT HATCHER:  That gets us back to the question on page 15.  Is that a correct question?


MS ADLER:  I guess the question was canvassing the views of the sector.  It's an opinion about whether or not they think that an RDO system is appropriate for the residential construction industry.  You get a range of views in response.


VICE PRESIDENT HATCHER:  Is this the second one?


MS ADLER:  Yes.  Like I said, I mean, you treat these as sort of individual snapshots of businesses operating in the sector.  I don't propose to say that these are representative of the entire industry, but certainly they are reflective of the views of those that responded, obviously, and we would submit, provides the Bench with some insight into what actual industry participants views are of the way the award is operating at the moment.


DEPUTY PRESIDENT HAMILTON:  The alternative to having this sort of material is not to have any material.


MS ADLER:  That's right, your Honour.


VICE PRESIDENT HATCHER:  Do I take it from this that there's only one response from the Northern Territory?  Is that the way you read this?  If you go to 85, there's a reference to Northern Territory about - - -


MS ADLER:  There was only one additional comment made.


VICE PRESIDENT HATCHER:  Right, but not the number of responses.


MS ADLER:  No, so what's extracted there are only those obviously that provided a response in the free text option of the survey.


VICE PRESIDENT HATCHER:  In a state where, or in a territory where 100 per cent of respondents don't provide an RDO, this one thinks it's inappropriate.


MS ADLER:  I'll let the Bench make their assessment of the comments provided.


DEPUTY PRESIDENT HAMILTON:  Employers have filled out these survey forms in good faith, in order to assist the Bench, to some extent and that's how they should be treated, wouldn't they, to some extent.


MS ADLER:  That's my assumption.  Like I said, I'm not suggesting that these can be representative of the entire industry.  They are the views of 290 of our members, operating in the residential construction sector who have employees covered by the relevant award.


UNIDENTIFIED:  It's skewed to small business.


MS ADLER:  That would be what was indicated by those qualifying questions at the beginning, which is the majority of our membership is small business.


VICE PRESIDENT HATCHER:  The question on page 34, "Why do you pay wages?"  That's an odd question.


MS ADLER:  I think that's so the question - - -


VICE PRESIDENT HATCHER:  Is that the question in a shortened form, is it?


MS ADLER:  I think that it relates to an earlier question, why do you pay wages in the way that you answered to a previous question.


VICE PRESIDENT HATCHER:  Are the full questions set out somewhere?


MS ADLER:  Yes, they are.  It's attachment A.




MS ADLER:  Sorry, annexure A.  That's the questions that were set out.




MS ADLER:  If you go to - the payment of wages questions start at question 23 on page 67 of annexure A.


VICE PRESIDENT HATCHER:  There's 24 are there?




VICE PRESIDENT HATCHER:  Getting back to redundancy - - -


MS ADLER:  Yes, thank you, your Honour.  Part four of our 2 December submission, deal with the industry's specific redundancy scheme and that's at page 18 of those submissions.  Obviously, I won't go into the detail that we've set out in those written submissions, but there are just a few mattes that I'd like to highlight for the Bench in relation to our variation application and in response to the CFMEU's reply submissions which were dated 10 March 2017.


As I alluded to in my opening comments last week, the nature of our claim is simple.  Those in the residential construction industry should be subject to the same conditions of employment in relation to redundancy as the vast majority of other businesses in Australia and the variations that we propose are targeted at achieving this.


Last week, his Honour Deputy President Hamilton asked me whether the industry specific redundancy scheme was in fact, a deferred payment scheme.  That might be the case in practical terms, but in reality, and as I've outlined in our written submissions, during award modernisation, the Full Bench of the Australian Industrial Relations Commission determined that the current clause 17 of the onsite award is an industry specific redundancy scheme for the purpose of section 141 of the Act.


However, what I would say is that while there is a Full Bench classing this provision as an industry specific redundancy scheme, it's arguable that the provision operates as something else entirely.  That if the Commission is not minded to adopt our primary position, which is to delete the clause in its entirety, then the proposals that we have made, or the alternate positions we put, would make the current provision more akin to a redundancy scheme, than something else.  If I go to our alternate views, because I think that the primary position is quite simple – just delete the scheme.  The alternate view has three components, which I did outline last week, but I think for the benefit of the Bench, I think I'll briefly touch on.


The first is to amend the definition of redundancy provided by clause 17.2 so that an employer is not financially punished when an employee resigns.  We put forward two options to address that, and they are set out in the draft determinations which are attached to our written submissions at attachments E and F to those submissions.  The first option is to define redundancy as a situation where employment ceases at the initiative of an employer other than for reasons of misconduct of refusal of duty, or where employment ceases because of the insolvency or bankruptcy of the employer.


The second option would simply specify that clause 17 does not apply where employment ends at the initiate of the employee.  In addition to that, we propose to insert a small business exemption along the lines that currently exist in the Fair Work Act and to insert a provision that will provide an incapacity to pay provision similar again, to what's currently in the Fair Work Act to provide the same option to those covered by the industry specific scheme as to others who are subject to the redundancy provisions of the national employment standards.


We say there's nothing foreign in what we're proposing.  They're based on the current terms of the Fair Work Act or well-settled case law on the issues.  We say the current provision no longer - - -


DEPUTY PRESIDENT GOSTENCNIK:  Ms Adler, sorry, before you go on, the one feature of the industry specific redundancy scheme in clause 17 is that an employer can avoid the obligation in whole or in part to make a redundancy payment in circumstances where the employer makes a contribution to a redundancy scheme.  Do we have any information about how those schemes operates, in other words, do those schemes make payment to an employee in circumstances where the employee resigns his or her employment?


MS ADLER:  I'm not aware of how those schemes operate, your Honour, and in our sector, who are award covered, my understanding is that they're not widely used.  In any case, our proposed variations don't seek to touch those parts of the clause.


DEPUTY PRESIDENT GOSTENCNIK:  But one is linked to the other, that's my point.  The industry specific nature of the scheme, at least in part, a feature of it is that linkage.




DEPUTY PRESIDENT GOSTENCNIK:  If you take away one of the criteria which is in the definition of redundancy, where does that leave the linkage?


MS ADLER:  Well, on the face of clause 17.4, I guess, my argument is that there's nothing in that provision which prevents a change to the definition of redundancy.  There's no element at clause 17.4 that says it applies broadly to or doesn't apply to the circumstances in the definition.  We would say - - -


DEPUTY PRESIDENT GOSTENCNIK:  But aren't we prevented from varying an industry specific scheme in circumstances which would remove the industry specific nature of it.  Isn't there some limitation?


MS ADLER:  Your Honour - - -


DEPUTY PRESIDENT HAMILTON:  You're not introducing an identical provision to the NES or the TCO.  You're introducing a variant on the TCO, even if your proposals are adopted, aren't you?


MS ADLER:  That's right, and there's two options that we put forward.


DEPUTY PRESIDENT HAMILTON:  So it is an industry specific scheme because under your alternative proposals, it would be a scheme very dissimilar to the NES.


MS ADLER:  Yes, it would align – the definition would align more so with the general understanding of what redundancy is.


DEPUTY PRESIDENT HAMILTON:  It wouldn't be identical?


MS ADLER:  No, it would not be identical.


DEPUTY PRESIDENT HAMILTON:  It would be industry specific in 1that sense.


MS ADLER:  Yes, your Honour, it would.  It also retains clause 17.3, which is the actual amount of payment which is different from the NES.


DEPUTY PRESIDENT GOSTENCNIK:  Can you just have a look at section 141(3).


MS ADLER:  Yes, your Honour.


DEPUTY PRESIDENT GOSTENCNIK:  If you can just identify how your variations fit within that subsection.


MS ADLER:  141(3)(a) talks about varying the amount of redundancy payment in the scheme, particularly the small business exemption, incapacity to pay provision are about redundancy payments.  The definition also is about the amount of redundancy payment that could be made under the provisions.


DEPUTY PRESIDENT GOSTENCNIK:  Getting back to my earlier point, one of the things we must do in varying any industry specific redundancy scheme, is under subsection (4), we must retain the industry specific character of it.  In order to retain its character, one must first identify what the industry specific character is.  Do you have a view about what that is, and how your variation doesn't offend that provision?


MS ADLER:  I'd say two things in response, your Honour.  The first is that the Full Bench during the award modernisation process, identified some characteristics and I can go through and find those for you which said that this is why we say it's an industry specific scheme.  The second thing I would say is that we're not touching clause 17.3 which deals with the amounts of redundancy paid.  Those amounts are different from what's under the National Employment Standards.


We're also not touching clauses 17.4 and 17.5, which as you've indicated, relate to specific schemes for redundancy payments in the industry.  In that way, we would say that it retains the industry specific character while also our proposed variations would ensure that the award better meets the modern award's objective by allowing or ensuring that the scheme doesn't operate in such a way that payment is made when an employee resigns and that small businesses are not adversely affected compared to other industries that are covered by the National Employment Standards.


DEPUTY PRESIDENT GOSTENCNIK:  The industry specific nature of this clause, it came from an award variation not from a scheme established outside the award, isn't that correct?


MS ADLER:  That's my understanding and we set out, from our perspective what the history - - -


DEPUTY PRESIDENT GOSTENCNIK:  If your variation was granted it would be dissimilar, or not identical to any other award scheme.


MS ADLER:  That's right, your Honour.


DEPUTY PRESIDENT GOSTENCNIK:  Using the ordinary meaning of the words, it would be an industry specific scheme?


MS ADLER:  Yes, yes.  I would submit that we would make it sit more comfortably with what a redundancy scheme actually is, as opposed to what we have now, which is a scheme where a payment is made when employment ends for whatever reason, except for misconduct or refusal of duty, which we say is quite different from what redundancy actually means in a common sense of it.


DEPUTY PRESIDENT GOSTENCNIK:  Section 141(3)(a) talks about varying the amount.  Now if you vary the amount of severance pay, that would clearly perhaps be consistent, but you're not.  You're varying the situation where redundancy occurs; you're varying small business.  How are those things, varying the amount?


MS ADLER:  In relation to small business, you are varying the amount that a small business would have to pay.




MS ADLER:  To zero.  In relation to the definition you are varying the circumstances in which a payment is to be made.


VICE PRESIDENT HATCHER:  You're not changing the amount, you're changing the condition of who's redundant in the first place.


MS ADLER:  Yes, which affects the amount.


VICE PRESIDENT HATCHER:  You could have dealt with this expressly by saying I suppose, redundancy clause by employee resigning and putting a zero next to it.


MS ADLER:  Yes, we almost go that far, but we didn't.


VICE PRESIDENT HATCHER:  You could do that and you'd say that's directly within the section, I suppose.


Is that it for redundancy?


MS ADLER:  I'd just like to give the Bench four reasons to adopt the variation, just briefly.  As is evident in our written submission, the provision was introduced in 1990.  We say that that can no longer provide a fair and relevant safety net.  The original scheme was introduced to enable an employee to accrue redundancy benefits based on service in the industry and an employee would be entitled to redundancy benefits on exiting the industry equivalent to their years of service.


Originally the benefit was not payable when employment ended with a particular employer.  We almost took the nature of a portable scheme when it was originally introduced.  It was changed subsequent to that and from the decision it seems, due to industrial unrest, so that payments were based on service with a particular employer and I believe that's how we've ended up with what we have today.


DEPUTY PRESIDENT GOSTENCNIK:  You think it was a 1990 decision?


MS ADLER:  Yes, your Honour.  We've referred to the relevant case law in our written submission.  Further to that, the written submission also indicates, in the cases outlined within that written submission, that the scheme was ultimately introduced by a consent award to facilitate industrial peace.  We outline the details of those decisions at paragraph 4.4.8 of our 2 December submission.


I guess from the history of the provision, we would say that they were inserted by consent, ultimately and due to industrial unrest in the industry.  Now we're sort of 27 years later, we would argue that those circumstances no longer prevail and that the provision should be updated to meet the modern award's objectives.


VICE PRESIDENT HATCHER:  What circumstances no longer prevail?


DEPUTY PRESIDENT GOSTENCNIK:  Industrial unrest in the industry.


MS ADLER:  Not to the extent that they did then.


DEPUTY PRESIDENT HAMILTON:  Literally speaking, those clauses were made in the settlement of industrial disputes.


MS ADLER:  Yes, your Honour.


DEPUTY PRESIDENT GOSTENCNIK:  Because it was the conciliation and arbitration power.  Now it's not; it's the corporation's power.


MS ADLER:  That's right.


DEPUTY PRESIDENT GOSTENCNIK:  There's a different basis for these proceedings.


MS ADLER:  We don't have individual parties in the same way that we did then.


DEPUTY PRESIDENT GOSTENCNIK:  Or applications to vary?


MS ADLER:  That's right.  The scheme, the legislative framework is different now than it was then.


VICE PRESIDENT HATCHER:  Does the survey say anything about this issue?


MS ADLER:  No, it does not, your Honour.


VICE PRESIDENT HATCHER:  Is there evidence of a problem here that needs to be solved?


MS ADLER:  The evidence that we point to is exhibits 26 and 27 which are the statements or Rick Sassin and Huan Do and they are at attachments G and H to our submission.


DEPUTY PRESIDENT HAMILTON:  Is the problem cost, is that your main problem?


MS ADLER:  The problem is – cost is obviously one of them, but the statements and the materials provided that we rely on, suggest that members are surprised and I guess shocked, that they need to pay this amount to an employee who resigns, who has a job lined up that they're going to the next day or the next week or the next fortnight, and they still have to make, often times, a significant payment.


Particularly paragraph 13 of Rick Sassin's statement does talk about the additional cost and then paragraphs 12, 13 and 14 of Mr Do's statement talk about that members when advised of having to make a payment, simply can't afford it, particularly when an employee has resigned.  Notwithstanding that, I think the cost is self-evident on the face of the provision, that you need to make this payment when somebody resigns.


DEPUTY PRESIDENT HAMILTON:  Aren't you relying on the common award's objective as well?  It's not just these alleged problems which someone I'm sure will dispute.


MS ADLER:  Yes, your Honour.  It doesn't provide a fair and relevant safety net anymore.




MS ADLER:  I would just like to note that we did raise similar issues during the 2012 modern award review and we would say, and in refusing – his Honour Senior Deputy President Watson refused our variation application, but we would say that that review was much narrower than what we have now.  This review is said to be broader and we say that this is the opportunity to review this provision, and there's scope for this framework under the four-yearly review to do so.


I guess, finishing off on the evidence that we rely on, the notion that a payment needs to be made to an employee who resigns, is fundamentally at odds with what redundancy generally means.  An employer running a small business who thinks he knows what redundancy means, doesn't actually know what it means and so could be held to be in breach of the award, for misunderstanding what the term means within the context of the award specifically.


The other matter that I'd just briefly like to address is the decision in the black coal mining industry which I believe copies have also been provided to the Bench and is probably in some other party's material.  The unions rely on this in their reply submission.


VICE PRESIDENT HATCHER:  They rely on it?  I thought they were seeking judicial review of it.


MS ADLER:  That decision considered clause 14 of the Black Coal Mining Industry Award and that provision provides for severance and retrenchment payments to be made to redundant employees.  That decision specifically considered an application of the Coal Mining Industry Employer group to vary clause 14 to insert a cap on redundancy payments due to the removal of a provision which was found to be discriminatory.


That provision was clause 14.4(c) which is outlined in paragraph 1 of that decision and talks about the amount of retention payment not be more than what an employee would have received, had the employee remained in employment with the employer until the age of 60.  That provision was removed.  Subsequent to that, an application was made to insert a different form of cap, given that the existing one had been removed.


I guess there's just three things I'd like to say about it briefly.  Firstly, in that decision, the Full Bench was asked to consider a discrete point being the effect of the scheme on the removal of that 60-year redundancy cap and whether any other changes should be made in light of that decision.  The Full Bench was not asked to weigh the history of that scheme under the Black Coal Award against the modern award's objectives and the requirement that modern awards provide a fair and relevant safety net, compared to what we're asking the Bench to do in these proceedings, which is exactly that.  We say that wasn't done in the Black Coal Industry decision.


VICE PRESIDENT HATCHER:  I think it was, Ms Adler.  I think it was squarely brought.  I think that case was squarely brought within the sense of whether the provision met the modern awards objective.


MS ADLER:  I would submit that it was only talking about the provision of a cap, not the scheme in its entirety.


DEPUTY PRESIDENT HAMILTON:  Did the employers only seek a cap?


MS ADLER:  Yes, your Honour.


DEPUTY PRESIDENT HAMILTON:  The other issues weren't sought?


MS ADLER:  That's what my submission is, your Honour.




MS ADLER:  Also, in the case of the onsite award, the provisions of the National Employment Standards are actually more generous than what's provided by clause 17 in the industry specific scheme, which seems to be the reverse in the Black Coal Industry Award.  So, there's another difference between the two industry specific schemes.


The final difference between the two schemes, is that in fact, in the Black Coal Industry Award, there is a definition of redundancy under clause 14.2 which differs from what's in the onsite award.  I just make those points about that decision and that was all the oral submissions I'd like to make.


VICE PRESIDENT HATCHER:  We don't have any information about the modes of employment which your members use or how long they typically employ people for, or anything like that, do we?  I mean, it might have been useful if the survey had addressed some of these issues.


MS ADLER:  The qualifying questions of the survey ask about the number of employees, the types of employees they employ, whether or not they use independent contractors, the types of award that they're covered by, that's just to name a few off the top of my head.  Whether they're a builder, renovator, developer or supplier, what state they're based in, whether they work on residential sites or commercial sites only or both residential and commercial.


VICE PRESIDENT HATCHER:  Does the scheme in this award apply to casual employees?




VICE PRESIDENT HATCHER:  What are the matters in the survey you just addressed, so I can see them.  There was numbers of employees, where's that?


MS ADLER:  In annexure A, so that's page 63, questions, 1, 2 - -




MS ADLER:  No, no, this is just in annexure A, which is just the list of questions, which is probably more helpful.


DEPUTY PRESIDENT HAMILTON:  You've just been reading the questions.  Page 3 gives the answer, that is – looks like 83 per cent and 15 or less employees.


MS ADLER:  Yes.  The answers to those questions are pages 3 to 7.


VICE PRESIDENT HATCHER:  30 per cent of casuals, but we don't have any information about length of service?


MS ADLER:  No, we don't.




MS ADLER:  If it would assist, in our written submissions, at paragraph 1.3.14, which is page 7, we extract some dot points setting out some of those characteristics that are evident on the face of the survey.


DEPUTY PRESIDENT GOSTENCNIK:  You didn't ask anything about redundancy.


MS ADLER:  Well, your Honour - - -


DEPUTY PRESIDENT GOSTENCNIK:  You can't ask about everything, I suppose.


MS ADLER:  That's part of the issue.


DEPUTY PRESIDENT GOSTENCNIK:  I'm not being critical.


DEPUTY PRESIDENT HAMILTON:  We have some information which is better than nothing, perhaps, but it's limited.  Thank you.


VICE PRESIDENT HATCHER:  On the face of it, your small business exemption cuts out 80+ per cent of your members out of the current scheme.


MS ADLER:  Yes, your Honour.


VICE PRESIDENT HATCHER:  Right thank you.  Mr Schmitke.


MR SCHMITKE:  Thank you, your Honour.  I think - - -


VICE PRESIDENT HATCHER:  Sorry, we might take a short adjournment now Mr Schmitke and come back in about 10 minutes.

SHORT ADJOURNMENT                                                                    [3.36 PM]

RESUMED                                                                                               [3.50 PM]


MR SCHMITKE:  Thank you, your Honour.  Master Builders have advanced a claim with respect to the industry redundancy scheme at clause 17 of the award.  Yes, if I can just note from the outset some housekeeping matters in the Commission's issues document.  There is some contention raised about the extent to which we would seek that this provision apply in the Joinery Award.  I can confirm it's restricted to the On-site Award.


Secondly, in terms of any uncertainty about the proposed provision, if I could just make it clear that we're relying upon the draft determination which is items 1 and 2 in the document that we have previously submitted to the Commission.


VICE PRESIDENT HATCHER:  Your small business exemption is five employees or less?


MR SCHMITKE:  Five or less, and there's a number of elements to it.  So essentially we would be seeking to make it better reflective and more reflective of the circumstances in the industry by providing some relief to the micro-business employers and also reflecting in a more practical sense what actually transpired in the sector.


So the second criteria is that an employee would have to have completed more than two years' service with an employer in order to be eligible.  So what that does is it provides some relief to micro-business and it addresses this issue of workers who are essentially leaving to go to another job or just decided to go up the road and receive additional benefits and that triggers an entitlement to that so ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  So that means that the micro-employer, as you describe it, their employees don't have the protection of redundancy in any circumstance.


MR SCHMITKE:  That would be the case, yes.  Yes.  But they wouldn't have if they were outside of the sector irrespective.  I suppose the problem that manifests itself very obviously in this sector is the definition of what is a conventional redundancy and what is not.  Clearly the existing provisions, we say, don't necessarily reflect the conventional term, but, of course, we also note that the existence of industry specific schemes is something that the sector is used to and it acknowledges, so ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  I'm sorry, I don't understand.  Are you saying that clause 17.4 is not really a great protection for the micro-employers; is that what you're saying?  Because they don't contribute to those schemes?


MR SCHMITKE:  Sorry, no, no, no.  So the ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  I may have missed what you were saying.


MR SCHMITKE:  Let me be clear, we've got the scheme; that's established.  Then we've got the industry specific funds.  The funds have relevance by way of obviously the contributions made and that offsets any obligation that might exist elsewhere within the provision.  The reality is that, we would say certainly from Master Builders' perspective, the overwhelming majority of participants in the sector – now, I can't speak necessarily for Ms Adler's members notwithstanding that we share them, but certainly for our more conventional members, everybody pays the regular contribution to the fund, and we don't seek to disturb necessarily how those funds operate.  We just seek to, I suppose, limit the circumstances where an employee is not paying to that fund and where they are a micro-business and they're utilising the provisions of the award.


VICE PRESIDENT HATCHER:  But it may imbalance the system that it creates by changing the award system you create incentives not to pay into the fund whereas currently that incentive may not exist.  For example, if, I assume is the case, the industry scheme pays out redundancy upon resignation on request; is that right?


MR SCHMITKE:  It actually depends, your Honour.


VICE PRESIDENT HATCHER:  It depends.  All right.


MR SCHMITKE:  There is some differences between the way in which the funds themselves operate.  In the time available I've just had quick – I did have some materials here that looked at the deeds of arrangements and they are different for those funds and the obligations to pay into those funds, the frequency within which you pay into them, and the circumstances in which an employee can get the money out of the fund, are slightly different.


VICE PRESIDENT HATCHER:  I hear what you're saying.  Let's assume we open up differences between the award and the fund that may make it more attractive to go back to the award and stop paying into the fund if, for example, you never have to pay redundancy on resignation and, in that sense, imbalance the industry fund.


MR SCHMITKE:  But only to the extent – well, I wouldn't say that that necessarily creates an imbalance.  Right now there's not an obligation to pay the fund and it's something that is commonly done for various reasons.  We would say the majority of the reason is because it's contained as a requirement in an enterprise agreement.  There are ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  Is it enforced by head contractors?




DEPUTY PRESIDENT HAMILTON:  Is all the new building legislation relevant to this; codes and the like?


MR SCHMITKE:  It's just ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  I don't want to open up yet another argument but ‑ ‑ ‑


MR SCHMITKE:  That's a big can, your Honour, of worms, but what I would ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  We'll be here all today, but ‑ ‑ ‑


MR SCHMITKE:  But what I would say is I wouldn't necessarily have thought that the recent amendments to the code or associated underpinning legislation would necessarily have any impact on that question.


DEPUTY PRESIDENT HAMILTON:  Okay.  But there's no obligation to contribute to these industry funds.


MR SCHMITKE:  No.  That is exactly the case.


DEPUTY PRESIDENT HAMILTON:  It's a voluntary thing.


MR SCHMITKE:  That's exactly right.  Yes.  So essentially by making the change that we seek to make we believe that to provide that relief to micro-business we believe it would better reflect the need to the sector insofar as you don't have itinerant workers, and when I say itinerant I mean people leaving from one job to another to another to another it comprehends a circumstance where an employer actually has some degree of length of service with an employer.  Sure it's not the normal conventional length of service that's required to trigger such a scheme or a payment but it's more akin to what is provided elsewhere but it still retains the character of our scheme, and in fact arguably it creates a provision which is more representative of what happens in our sector and more representative of the intention of the scheme than what it currently is.


VICE PRESIDENT HATCHER:  What do you mean by more representative?


MR SCHMITKE:  It accommodates the fact that there is a large number of workers who do go from project to project, so we do have these project based arrangements, so our claim accommodates that.  It provides for a different definition of redundancy which effectively says that it's at the initiative of the employer because they no longer require the work to be done by anyone at the initiative of the employer because:


The operational or similar circumstances of the project or site on which the employer is working are such that the employer no longer requires the employee to perform work and there is not an agreement between the employer and the employee for future employment on an alternative site or project or the employer ceases to exist and/or no longer requires the engagement of the employee.


So ‑ ‑ ‑


VICE PRESIDENT HATCHER:  So if it's project by project employment, remove resignation and you extend the basic payment to two years nobody will ever be paying redundancy will it?


MR SCHMITKE:  Not necessarily, no, because if the intention of the scheme is to accommodate the nuances of the sector whilst at the same time recognises the length of service of workers then these changes we would say better meet both of those criteria.  Not every project is finished within two years, and if a project stops it's not uncommon, in fact it's very common, for an employee to move that subsequent project and have a period of unemployment in between for which they get paid out for in a redundancy situation but more often than not ‑ ‑ ‑


VICE PRESIDENT HATCHER:  So say that again.


MR SCHMITKE:  If you have a contractor working on a project and he might be undertaking a specific part of that project, when that project ceases if the employee has ceased employment technically with the contractor it's more common than it's not that when that contractor goes to the next project that same group of workers goes across.  I think in the context of – it was in another context but some of the witnesses from the CFMEU provided evidence to that effect.


VICE PRESIDENT HATCHER:  So is service broken in that circumstance?


MR SCHMITKE:  It wouldn't be broken in that circumstance.




MR SCHMITKE:  Because there would be - a redundancy is taking place where you wouldn't – sorry, it's not broken but it's not counted as time to the – in between is not counted as time served.


VICE PRESIDENT HATCHER:  Yes.  But what's the source of that proposition?


MR SCHMITKE:  On the basis that there's no agreement for the employer and the employees to work together again at some point in the future on an alternative project or site.


VICE PRESIDENT HATCHER:  You're reading from your proposal?




VICE PRESIDENT HATCHER:  So what are you reading from?


MR SCHMITKE:  If I could take you to our determination.  This is ‑ ‑ ‑


VICE PRESIDENT HATCHER:  The ones you put in on Friday?






MR SCHMITKE:  (ii), correct.  On page 1.


DEPUTY PRESIDENT HAMILTON:  So that often happens, does it?  They agree to work on an alternative site?






MR SCHMITKE:  Because you'll have a builder, a large builder, or what's perceived to be a large builder who's the project manager ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  So in effect they're ongoing employees in the building sense, which is intermittent but continuing relationship.


MR SCHMITKE:  Yes.  Yes.


DEPUTY PRESIDENT HAMILTON:  And that's quite a common way of structuring your workforce is it?


MR SCHMITKE:  Absolutely, yes.


DEPUTY PRESIDENT HAMILTON:  So that you have regular skilled employees and they have expectations and you – I see, yes.


MR SCHMITKE:  And often the nature of some of those smaller contracts is ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  That's how you deal with the problem of going from site to site and still requiring a workforce?






MR SCHMITKE:  Yes.  And often the nature of some of those smaller contractors they're specialised work so it's not as though you will have, you know, a large degree of employees to select from when you move to the next project.  You have to rely upon essentially an ongoing pool.


DEPUTY PRESIDENT HAMILTON:  That phrase is used, an agreement as to future work?  That's sufficiently precise is it?  It's not going to cause problems?


MR SCHMITKE:  We say it wouldn't.




MR SCHMITKE:  That is essentially all I'd like to say in respect of that application other than perhaps to point out that we would say that this is more reflective of what happens in the industry; it's more reflective I suppose of what's happening more generally in terms of length of service with employers.  It's not the sixties any more.  We are moving towards lower periods of employment or length of time in a more general sense and to the extent that there's not relief provided to our sector ‑ ‑ ‑


VICE PRESIDENT HATCHER:  Sorry, we're moving to what?


MR SCHMITKE:  To the extent that there's no relief provided ‑ ‑ ‑


VICE PRESIDENT HATCHER:  No, before you said we're moving towards ‑ ‑ ‑


MR SCHMITKE:  Lesser period of employment insofar as you're not employed with one employer for 15 years or 20 years any more.  That's uncommon generally.


VICE PRESIDENT HATCHER:  Was that ever common in the construction industry?


MR SCHMITKE:  I'm not saying that it was common.


VICE PRESIDENT HATCHER:  There's no evidence of that proposition, is there?






MR SCHMITKE:  But in a broader sense though by making the change we propose it is more reflective I suppose of that changing nature of employment more broadly.


VICE PRESIDENT HATCHER:  Thank you.  Does any other employer group want to say anything about this?  Mr Boanza?


MR EBERHARD:  If I can, your Honour.  The Master Plumbers Group rely on the written submissions previously made to the Commission during these proceedings.  The Master Plumbers Group supports and endorses the submissions in the various employer associations seeking a variation to the industry specific redundancy scheme.  The Master Plumbers Group preferred outcome is for the Plumbers and Fire Sprinklers Award in that the industry specific redundancy scheme contained in that award apply to that class of employee that had that entitlement prior to the making of the Plumbing and Fire Sprinklers Award whilst the NES would have application to that class of employee employed on a weekly hire basis and I'll explain that later.


If the Commission were not of a mind to make the change proposed by the Master Plumbers Group but were minded to make a different change the Master Plumbers Group would not oppose such a scenario.  We've already had reference to the Black Coal Mining Industry Award and I'm not going to take the Commission to what it had intended to do with that apart from saying that in paragraph 14 of that decision there's a quote there that talks about, and it refers to the, explanatory memorandum to the Act and it references the fact that:


FWA must ensure that the coverage of the scheme is not extended to classes of employees that it did not previously cover.


Prior to the making of the Plumbing and Sprinkler Award 2010 there were a total of 11 awards that covered the employment of plumbers and/or fire sprinkler fitters.  The 11 awards are identified in paragraph 15 of the Master Plumbers Group submissions from December 2016.  In paragraphs 16 and 17 the Master Plumbers Group provides the Commission with analysis of the 11 awards.  That analysis demonstrates that an employee is employed subject to the Plumbing Industry (New South Wales) Award 1999; the Plumbing Industry (Queensland) and WA Award of 1999; the Plumbing Trade Southern States Construction Award and the Southern States Award applied to those respondents within South Australia, Tasmania and Victoria and then applied on a common rule basis within Victoria from 8 December 2004 to the Plumbing and Gas Fitters South Australian Award, and the Plumbing and Gas Fitters State Consolidated Award, which was another New South Wales award, could only be employed on either a daily hire or a casual basis.


There is no full-time weekly hire or part-time hire employment provided under any of those awards.  The analysis also demonstrates an employee employed subject to the Gas Fitters Queensland Award 2000, the Plumbing Industry ACT Award 1999, the Plumbing Industry Victorian Government Departments and instrumentalities and Public Hospitals Award 2000, the Plumbers Award which was a Tasmanian award and the Sprinkler Pipe Fitters Award 1998 could be employed on a weekly hire basis.


The Plumbing Industry Mixed Industries Award 2000 did not contain any specific type of employment.  It is the Master Plumbers Group view that prior to the making of the Plumbing and Fire Sprinklers Award 2010 the vast majority of plumbing employers and plumbing employees were employed subject to an award that only allowed for their employment on either a daily hire and/or casual basis.  For the vast majority of plumbing employers the option of employing their employees on a weekly hire basis only became a reality on 1 January 2010.  The Master Plumbers Group submit that the Commission inserting in to the Plumbing and Fire Sprinklers Award provisions that allowed for the employment of employees on either a weekly hire basis or a part-time basis inadvertently for the vast majority of plumbing employers and plumbing employees expanded the operation of the industry specific redundancy scheme to a class or classes of employees who were previously not covered by the industry specific redundancy scheme, that is, those employees employed on a weekly hire basis.  We submit that that should now be corrected.


VICE PRESIDENT HATCHER:  Okay.  So what do you mean correction unless there was an error?  What was the error?


MR EBERHARD:  The error, we submit, your Honour, is that, as I said, the vast majority of employers and employees that were covered by plumbing awards could only be employed on either a daily hire or a casual basis.  When the Plumbing and Fire Sprinklers Award was made in 2010 the types of employee that could be employed expanded to include weekly hire and part-time employment.  Under the Act the Act talks about that the scheme should not be expanded to cover a class or classes of employees that ‑ ‑ ‑


VICE PRESIDENT HATCHER:  No, it says you can't vary an industry specific scheme in a modern award to expand it, but it doesn't say anything about what you do at the starting point which is including the scheme and the modern award.  I think you're confusing two different things.


MR EBERHARD:  Our submission is that in respect to the scheme the scheme that operated prior to the making of the Plumbing and Fire Sprinklers Award, the scheme only had application to a daily hire employee.  We say that based upon that I think that it is still our submission that when you go back to looking at the way the awards were originally made that the classes of employees that the scheme shouldn't have been extended to the class of employees and by including weekly hire and part-time hire within the award the Commission has inadvertently expanded the operation of the scheme.


VICE PRESIDENT HATCHER:  Yes.  That's now six or seven years ago.  What's the point now?


MR EBERHARD:  The point is that the scheme when it was made originally only had operation in the ‑ ‑ ‑


VICE PRESIDENT HATCHER:  I understand the point but there was a Full Bench in the award modernisation process decided to do that.  What's the error you're pointing out?


MR EBERHARD:  The error is that the scheme has now been expanded to include weekly hire and part-time employees where ‑ ‑ ‑


VICE PRESIDENT HATCHER:  No.  I think we're going in circles.  We can't now vary a scheme in a modern award to expand its coverage but that says nothing about what you could do when you made the modern award in the first place, does it?


MR EBERHARD:  What we're saying is that when you go back the original making of the award the intention and the nature of the industry specific redundancy scheme was that it applied to daily hire employment.  There was no other form of employment that covered employees in the vast majority of instances, so we submit that they should be excluded from the coverage of that particular scheme and covered by the national employment standards.


DEPUTY PRESIDENT GOSTENCNIK:  I think the Vice President's point is that that's a submission you should have made during the award modernisation process.  Now that there is a scheme which covers that class of people we're prevented from expanding the class but how do you say that the original Full Bench made an error?  Where was the limitation on its power to include a scheme of general application?


MR EBERHARD:  Understand your Honour's point of view, and ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  It's a question; it's not a point of view.


MR EBERHARD:  I understand the question and I wasn't around when this award was made and whilst I have read everything I wasn't subject to or privy to all of the discussions and the processes in regards to how things were done in that particular sense as to what positions were taken, what positions were adopted, so I don't know why that position wasn't put prior to 2010, but it's my submission now that it should've been put.  I understand what the Commission is saying is that it has now been made and in effect there's no ability to change that because the decision, in effect, should've been made, or that argument that I'm now making should've been made, whether it was 2008/2009, prior to the making of the award itself, but ‑ ‑ ‑


VICE PRESIDENT HATCHER:  But you haven't demonstrated that there was any error in the first place, that is, that the Full Bench when it made a modern award had the power to do what it did unless you persuade us otherwise.


MR EBERHARD:  What I'm suggesting, your Honour, is that when one reads the decisions that go to the nature of the scheme and the nature of the disability that the scheme represents and compensates for everything in those decisions refers to daily hire employment and the nature of that employment correlates to ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  Are you saying the original Bench has misconstrued the nature of employment in your sector?  Is that what you're saying?


MR EBERHARD:  I think, in effect, I probably am, your Honour, yes.


DEPUTY PRESIDENT HAMILTON:  Because I think that's what you just said but I wasn't sure.


DEPUTY PRESIDENT GOSTENCNIK:  Daily hire employment is casual employment; yes?  No?


MR EBERHARD:  No, daily hire is a form – and I suppose ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  Sorry, I'll withdraw that.  You made the submission that the only forms of employment that were available in respect of certain States were daily hire or casual employment.


MR EBERHARD:  That's correct, yes.


DEPUTY PRESIDENT GOSTENCNIK:  The current provision doesn't extend to casual employment, does it?




DEPUTY PRESIDENT GOSTENCNIK:  No.  So it's only daily hire employment that we're talking about, and your point is that the Full Bench which included an industry specific scheme somehow erroneously included part-time employees in the scheme; yes?


MR EBERHARD:  And weekly hire employees.


DEPUTY PRESIDENT GOSTENCNIK:  And weekly hire employees.


MR EBERHARD:  Correct.


DEPUTY PRESIDENT GOSTENCNIK:  Yes.  I understand that submission, but under the legislative powers that were available to the Full Bench at the time, how was that beyond power, or is just a merits argument?


MR EBERHARD:  I think it is.  It's not a question of power; it's a question of the merit in the sense of the nature of the scheme related to the daily hire employment and the disabilities that were associated with the daily hire employment.




MR EBERHARD:  We submit that the disabilities associated with the daily hire are different to the disabilities that are associated to weekly hire employment.


DEPUTY PRESIDENT GOSTENCNIK:  All right.  I'm not sure we can take this any further.  Thank you.


MR EBERHARD:  Our submission then continues in the sense that what we submit is that, as I said at the start, is that there should be in effect two schemes within the award; the industry specific redundancy scheme would apply to those employees employed on a daily hire basis and to sprinkler fitters because they were also entitled to the provision prior to 1 January 2010 and that employees employed on a weekly hire basis post 1 January 2010 would be subject to the national employment standards.  If the Commission pleases.


VICE PRESIDENT HATCHER:  So just one final thing; where does it make clear in the – I'm just glancing at it – in the clause what categories of employee it applies to?


MR EBERHARD:  No, there's no reference in the clause to an inclusion or an exclusion to daily hire or anything of that nature.  I'm just saying that when the industry specific redundancy scheme was first made that the nature of the argument in regards to the disabilities that were associated with daily hire led to the making of the scheme itself.


VICE PRESIDENT HATCHER:  The scheme itself doesn't make clear what categories of employee it actually applies to.


MR EBERHARD:  But the particular provision would apply to all employees subject to the award save and except for the casual employee.


VICE PRESIDENT HATCHER:  I know you say that.  I'm just wondering whether the award makes that clear.


DEPUTY PRESIDENT HAMILTON:  If the award doesn't specifically mention a category does it then apply to all the categories of employment possible under the award; is that what you're saying?


MR EBERHARD:  Yes, your Honour.  Yes.






VICE PRESIDENT HATCHER:  All right.  Anything further?


MR EBERHARD:  No, your Honour.


VICE PRESIDENT HATCHER:  All right.  Mr Boanza?


MR BOANZA:  Yes.  Thank you, your Honour.  Being the last cab off the rank requires a little bit of repetition so I beg your indulgence if I repeat myself.


VICE PRESIDENT HATCHER:  No repetition is required.  I'll just make that clear.


MR BOANZA:  Yes.  Thank you, your Honour.  I do need to mention that, you know, our members and employers in the civil construction industry are very angry with the current provisions of the redundancy in this award.  Our members are ‑ ‑ ‑




MR BOANZA:  Yes.  Our members would like to have the same redundancy provisions that's applied to all the other industries in the country, and to that effect, you know, we provided evidence in a survey of our members.


VICE PRESIDENT HATCHER:  Sorry, what does that submission mean?


MR BOANZA:  Sorry?


VICE PRESIDENT HATCHER:  The same redundancy provisions as other industries in the country?  What does ‑ ‑ ‑


MR BOANZA:  As other industries which are not subject to a redundancy scheme.




MR BOANZA:  Where employees are paid when they leave employment of their own accord.  That's the intention of my statement.  Yes.


VICE PRESIDENT HATCHER:  So the redundancy schemes that are available in respect of non-specific ‑ ‑ ‑


MR BOANZA:  Non-specific industry redundancy schemes, your Honour.




MR BOANZA:  To show that we conducted a survey of our members which we submitted in evidence.  We got ‑ ‑ ‑


VICE PRESIDENT HATCHER:  So what exhibit was that?


MR BOANZA:  It was submitted as evidence at the request of the CFMEU on 3 April prior to the evidence of Mr Middleton.  It was the request for information that was ‑ ‑ ‑


VICE PRESIDENT HATCHER:  Was this marked as an exhibit?


MR BOANZA:  Yes, it's in the submission, your Honour.


VICE PRESIDENT HATCHER:  In the submission.




MR CRAWSHAW:  It was tendered on Tuesday.  Tuesday.  It's exhibit 5 tendered first thing on Tuesday, 4 April at PN1040.  I think I only handed up one folder which I had the HIA survey and the CCF survey, so your Honours might not all have that unless it's been ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  So this is a three-page document, is it, that ‑ ‑ ‑


MR CRAWSHAW:  No, it's a whole folder.  Sorry ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  So far as the Civil Contractors Federation was concerned.  This is three-page document which appears to be correspondence addressed to the presiding Member.  Yes.


MR BOANZA:  Yes.  Also, your Honour, it's in our submissions in page 9 of our submission which was filed on 9 December 2016.


DEPUTY PRESIDENT GOSTENCNIK:  What page of your submission? What page of your submission?


MR BOANZA:  Page 9 of our submission of 9 December 2016 under the title, The View of the Industry.


VICE PRESIDENT HATCHER:  Sorry, what page?


MR BOANZA:  Page 9.




MR BOANZA:  Under the title, The View of the Industry.


DEPUTY PRESIDENT GOSTENCNIK:  Sorry, what was the date of the submission?


MR BOANZA:  So it's their submission which was dated 9 December 2016, and it was published in the modern award review webpage accordingly.


VICE PRESIDENT HATCHER:  So what you've done is you've asked your members if they agree or disagree with the proposition that redundancies where an employee ceases to be employed for other reasons; misconduct, refusal of duty?


MR BOANZA:  That's right, your Honour.  That's what we did.


VICE PRESIDENT HATCHER:  Or if the employee terminates the employment relationship?


MR BOANZA:  That's right, your Honour.


VICE PRESIDENT HATCHER:  So everyone except for one agreed with that proposition?


MR BOANZA:  That's right.  They did, your Honour.  That member who did not agree did not agree with the options that we provided in our submission.  That member insisted that we should only run with the national employment standards.


VICE PRESIDENT HATCHER:  Then you concluded from that the current redundancy provisions are an unreasonable burden on the industry because they discourage a strong and efficient construction sector.


MR BOANZA:  That's correct, your Honour.


VICE PRESIDENT HATCHER:  Greatly increase the cost of infrastructure and employee management difficulty in discouraged employment.


MR BOANZA:  That's correct, your Honour.


VICE PRESIDENT HATCHER:  How did you get that out of the survey?


MR BOANZA:  Sorry?


VICE PRESIDENT HATCHER:  How did you get that conclusion out of the survey?


MR BOANZA:  That was what was asked of them through the survey; that the current redundancy provisions were unfair.


VICE PRESIDENT HATCHER:  So were there separate questions about that, was there?


MR BOANZA:  No, we said there was a strong view in the industry that the redundancy provisions as they existed then are inequitable and unnecessarily expensive and discourage full employment.  They were also arrived at by the question that we asked our members on redundancy.


VICE PRESIDENT HATCHER:  That question on the top of page 10?


MR BOANZA:  Yes.  That's the conclusion that we drew, your Honour, from the evidence of our members and from the statement of our CEO who has just spent the last six years communicating with members, so in his statement he also provided the view that the members have of the current redundancy provisions.


DEPUTY PRESIDENT HAMILTON:  So you asked them if they agreed with that statement at the top of page 10 and they all said yes except for one?


MR BOANZA:  Yes, we did, your Honour.  Except for one.




MR BOANZA:  Who insisted that the entire national employment standards should be applied to redundancy in this award rather than the alternatives that we have provided in our submission.




MR BOANZA:  Thank you.




MR BOANZA:  So what we want to say in respect of the redundancy provisions, your Honour, is that, you know, we don't agree that they are fair.  We have evidence from our member, Mr Middleton, who told us that in 2016 he was forced to pay 45 weeks of redundancy to employees who were not redundant.  The redundancy scheme caps at eight weeks after four years of service, and after that time redundancy is supposed to accrue and therefore we say that that's another incentive for the employees to terminate their employment and find other employment so that the redundancy clock starts ticking again.


The CFMEU has relied on the history of the scheme in a number of decisions to support the continuance of the redundancy scheme.  What we say, your Honour, is that this redundancy scheme belongs in the past and that the modern award review is that they are changing awards so that they comply with the modern award objectives, and we say that the provisions of this redundancy scheme do not comply with the modern award objectives.


We have provided three alternatives that we would like the Commission to consider and we have provided some draft determinations in our submission.  So the first alternative would be similar to the Housing Industry Association, we support a draft determination where an employee who leaves their employment of their own accord would not be entitled to a redundancy benefit, and we say that that situation would retain the industry specific character of the scheme because an employee who retires medically unfit would still be entitled to redundancy.  An employee who passes away while employed, and that's all in our submission, his Estate will still be able to claim redundancy benefits, and if an employer chooses to contribute to a redundancy scheme such as ACIRT then that employer will still be able to do so and the employee will be able to claim redundancy benefits when the employment terminates appropriate to the rules of the scheme.




MR BOANZA:  Thank you.


VICE PRESIDENT HATCHER:  Does anyone in Sydney wish to add to this debate?


MR KRAJEWSKI:  Yes, if I might, your Honour.  Fire Protection Association Australia.  Your Honour, our position is, I suppose, it could be called a minimalist approach.  In our submissions and correspondence as of March 2015 and also our submissions last year, our position was really one of saying, well, the definition of redundancy should not include that of a resignation, and whilst we haven't re-developed that particular position further I think perhaps submissions from the building employers may have addressed that issue and perhaps Ms Adler may have done that in terms of that definition of redundancy.  We say that the question of whether an employer resigns or not should be – if an employer resigns that should not be counted in the redundancy situation.


We probably expanded upon that a little bit further in our submissions with regards to our July submission last year where we did expand upon the matter of daily hire, in which submission we also acknowledge and accept the provisions of the Full Bench both in '89 and again in 1990.  What we are saying, however, is that when one does look at, for instance, the Plumbing and Sprinkler Award you'll see that it's been put to the Commission earlier this afternoon the distinction between daily hire and weekly hire, and I think that's my recollection of the debate in the 1980s and 1990s was in terms of the pattern of work and without really knowing the nature of that industry then it appeared to me and prior to the 2010 awards that the sprinkler fitters didn't really fall into that line of daily hire and since the modern award has been in place you will see a distinction between weekly hire and daily hire, so what we are simply saying is that – and we accept the position of consistency within an award.  In this particular case what we are saying is that if you have a redundancy provision and it includes a reference to resignation for instance, then that should not be part of a definition for employer redundancy scheme, whether it be industry scheme or a broader scheme overall.


So our position essentially is if one goes a bit further perhaps, your Honours, Commissioners, if one compares for instance that of the electrical workers who also work alongside workers in the building construction industry their award, therefore the contracting award, is essentially the national employment standard, and so again, if one talks about consistency there is a significant group of employees within the building and construction industry that doesn't have an industry specific scheme.  So what we are simply saying, your Honours and Commissioners, is that in terms of the definition of redundancy the references to resignation should not be included in that particular definition.  If the Commission sees fit to maintain the industry scheme then, you know, that's one part of the industry scheme that possibly should be removed or amended to give the overall context of the industry scheme.  We just confirm that particular note.


VICE PRESIDENT HATCHER:  All right.  Thank you.


MR KRAJEWSKI:  If the Commission pleases.


VICE PRESIDENT HATCHER:  Ms Paul, did you want to say anything?


MS PAUL:  No, your Honour.


VICE PRESIDENT HATCHER:  All right.  Mr Crawshaw?


MR CRAWSHAW:  If I could address the questions that came from the Bench to Ms Adler about section 141.  Firstly, in terms of section 141 subsection (3) there was a question asked as to whether variations could take place given the subsection (a) says the variation can only take place under that subsection by varying the amount of any redundancy payment in the scheme.  We would submit that what is proposed by the various proposals of the employer organisation is not a variation to the amount of any redundancy payment but rather a change to the definition of redundancy for the purpose of that payment and/or a change in the eligibility for that payment, and that can be seen in the way the employer organisations have characterised their submissions.  The MBA submission at 6.2 talks about alterations under the subject headings of definition and eligibility and the HIA at 4.2.4 talks about definition of redundancy, small business exemption.


DEPUTY PRESIDENT HAMILTON:  Can they provide for the amount to be zero?




DEPUTY PRESIDENT HAMILTON:  Would it be consistent with the Act to provide for the amount for small business as zero?


MR CRAWSHAW:  We would submit not.  It's a question of characterisation and the proper characterisation of what is sought, as is said in the submissions themselves, is that the change refers to eligibility and definitions and not to the amount of any redundancy payment.


In relation to the question about section 141 subsection (4) as to the limit of the variation, and in particular whether subsection (b) applies to the variations sought, we would submit that none of the variations satisfy section 141 subsection (4)(b), and the question ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  But it would still leave a redundancy scheme which is significantly different to that applying in other awards, wouldn't it?  It would still be unique to this industry, wouldn't it?


MR CRAWSHAW:  I'm grateful to Ms Adler because she suggested that what we should do is go back to the 2009 decision to see what exactly was the industry specific character of the scheme, and I took advantage of the short break to do that.  The Commission should have the 2009 decision.  It's certainly supplied in our materials at number 33 of those materials if that is of any assistance, but I'm not quite sure how it's working up there in terms of electronically.


VICE PRESIDENT HATCHER:  You can see five folders sitting over there.  I'm just wondering whether that's it.  So who do you supply your materials to?


MR CRAWSHAW:  Like everyone else we supply them electronically.  I was a bit worried about whether that would necessarily translate, but it ‑ ‑ ‑




MR CRAWSHAW:  I think if I'm going to address this 2009 decision you should have it before you.  It's the decision that made the modern award.


VICE PRESIDENT HATCHER:  We'll try and get it copied while you're speaking so just keep on going and we'll try to get one in our hands as soon as we can.




VICE PRESIDENT HATCHER:  So can you just give the citation of the decision?


MR CRAWSHAW:  (2009) AIRCFB 345.




MR CRAWSHAW:  It's mentioned ‑ ‑ ‑


COMMISSIONER HARPER-GREENWELL:  What paragraphs if you go through to the two?




MR CRAWSHAW:  I'm going to go to paragraphs 75 through to 81.  Perhaps if I just apply those pages and I know your Honour doesn't like advocates ‑ ‑ ‑


VICE PRESIDENT HATCHER:  There's 79 to 80 are ‑ ‑ ‑


MR CRAWSHAW:  ‑ ‑ ‑asking for copies to be made but it's only four pages.




MR CRAWSHAW:  I can come back to this submission and go on with others.


VICE PRESIDENT HATCHER:  We indulged Ms Adler with this, so I suppose we have to agree.  Seventy-eight to 80 are reproduced in your submission.


MR CRAWSHAW:  That's true.


VICE PRESIDENT HATCHER:  So it's just 75.  Yes, I understand.


MR CRAWSHAW:  But to get the full context of what Ms Adler was guiding us to you really have to go to the two paragraphs that precede that.


VICE PRESIDENT HATCHER:  While we're waiting for that I'll just fire a few questions at you.  The existing clause, is it clear what categories of employees it applies to, that is, as between weekly, daily hire, casual, part-time?


MR CRAWSHAW:  I think it applies to all employees other than casual employees and apprentices.  Clause 17.3 to the left provides for the exemptions.  That's at ‑ ‑ ‑


VICE PRESIDENT HATCHER:  Seventeen – I see, that's apprentice.  I understand; a casual at (e).  Yes, all right.  What's the rationale for paying benefits to an employee who resigns?


MR CRAWSHAW:  The rationale?


VICE PRESIDENT HATCHER:  Yes.  That is, well, perhaps another way to put the question might be this; on what possible meaning of the word "redundancy" does it stretch to cover an employee who resigns?


MR CRAWSHAW:  There are decisions of the Commission that suggest that it does come within the definition including Wilson C's decision in the award simplification matter which was endorsed by Merriman C, but we don't have to go to those decisions given the definition of industry specific redundancy scheme.


VICE PRESIDENT HATCHER:  Which includes termination payments.


MR CRAWSHAW:  Yes.  It says it means redundancy or termination payment, and that's a matter dealt with in our written submissions which by the ‑ ‑ ‑


VICE PRESIDENT HATCHER:  So what provision is that?


MR CRAWSHAW:  Our written submissions commence at paragraph 53 of our reply submissions and we deal with this matter at paragraphs 59 and 61, and, in particular we say at paragraph 61 that the inclusion of that definition, and you'll see it's dealt with in the supplementary explanatory memorandum that's set out in paragraph 60, inclusion of that definition evinces a clear legislative intention that the industry specific redundancy schemes which provide for termination payment arrangements were apt to be included in modern awards.


VICE PRESIDENT HATCHER:  Let's assuming that's right, what was the original rationale of it?


MR CRAWSHAW:  The original rationale was the itinerant nature of the industry and the high turnover in the industry which mean that those employees would not gain access to the redundancy benefits that other employees might gain access to, and also the fact that if an employee is on a project that's about to finish, it's in the employee's interests, and the employee knows that he or she, typically he, was going to lose the job, the employee would be making efforts to get jobs elsewhere and therefore leaving before the end of the job, but by doing that would be deprived of the redundancy benefits that the employee would otherwise get.


VICE PRESIDENT HATCHER:  I can understand that scenario, but it goes broader than that.  So we had Mr Middleton's evidence which suggested that employees simply resigned at any time to access a higher paying project and took the payment at the same time.


MR CRAWSHAW:  Going right back to the 1989 Full Bench that originally dealt with this concept, the attitude is taken that there should not be two standards that apply to different workforces working on the same construction site, and it was recognised right back then which some people have said is in ancient times.  I think Mr Schmitke's gone back to the sixties this afternoon.  I don't think it goes back that far, but it was recognised right back then that there were employers who had stable long-time workforces like Mr Middleton gave evidence about; that there should not be two standards that apply on the one construction site, and likewise it was recognised in the original decisions after that that endorsed it that there were some subcontractors, in particular, that from time to time would have employees less than 15 or of a nature that would characterise them with a smaller business but they were working side by side with employees of an employer with a larger workforce, and the rationale was that you wouldn't have two different standards on the same construction site.


VICE PRESIDENT HATCHER:  Even if, in one case, the person's a weekly employee who's had indefinite employment across a number of projects and has secure employment prima facie into the future and simply decides to leave for whatever reason?


MR CRAWSHAW:  Yes.  That was taken into account, and it was a matter of whether you had two different standards in the building and construction industry or one uniform standard that went across the board.  Indeed, one of the rationales for having lesser payments than are in the NES is because it went across the board.


Those concepts were endorsed in the 2009 award.  Once again, it must be remembered that there's been some attempt to say, "Well, this is all ancient history".  These provisions were inserted by the Full Bench in making the modern award and they have been repeated despite attempts, for example, the HIA in the last award review, to have it removed.


If I could come to the relevant part of the 2009 decision is to be found at paragraphs 75 through to 81.  Coming back to the section 141 subsection (4) point, you will see that paragraph 75 is the decision to include the industry specific redundancy scheme.  Paragraph 76 sets out the consolidated request that was made at the time, and in particular you'll see at paragraph 39 of the request that there were two matters that were particularly to be taken into account by the Commission, or to have regard to, in determining whether particular redundancy arrangements constituted an industry specific redundancy scheme:


(1) when considered in totality whether the scheme is no less beneficial to employees in that industry and the redundancy provisions of the NES; and (2) whether the scheme is an established feature of the relevant industry.


Then paragraph 77 and ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  That last bit isn't in the Act, is it?  Whether the scheme is an established feature of the relevant industry.


MR CRAWSHAW:  It's not in the Act now as I understand it.  It was in a request.


DEPUTY PRESIDENT HAMILTON:  Right.  Thank you.  No, no, point taken.


MR CRAWSHAW:  I'm sorry?


DEPUTY PRESIDENT HAMILTON:  It was the minister's request not the act.






VICE PRESIDENT HATCHER:  Sorry, I can't remember the provision.  Was it Full Bench obliged to act in accordance with the request; is that the way it worked?


MR CRAWSHAW:  That's my memory but I haven't, in the time available, gone back and checked the precise provisions.


DEPUTY PRESIDENT GOSTENCNIK:  It was in the transitional legislation ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  I think it was but ‑ ‑ ‑




DEPUTY PRESIDENT GOSTENCNIK:  ‑ ‑ ‑covering the period between the continuing operation of the work choices legislation, if I can use that term, and the commencement of the Act, and the idea was to bring about the award modernisation process before the new Act came into operation therefore the modern award requests.


MR CRAWSHAW:  Yes.  Anyway, so in relation to the question of whether the scheme is an established feature of the relevant industry, paragraph 77 through to 79 go to give a plotted history going back to the 1989 Full Bench, which I earlier mentioned, and in other words going back some 20 years which went to the question of whether the scheme was an established feature of the relevant industry.


Then paragraph 80 appears to address the other criterion specifically mentioned in paragraph 39, and that's whether considered in totality whether the scheme is no less beneficial to employees in that industry for the redundancy provisions of the NES.  At paragraph 80 the Full Bench noted:


The current award description doesn't reflect the standard for larger employers arising from the redundancy case 2004 decision when regard is had to slightly more beneficial scale benefits.  In earlier years broader application would benefit, and the pattern of limited periods of continuous service within the industry to which the building and construction redundancy provisions were directed.  We are also satisfied that when considered in totality the scheme is no less benefit to employees in the industry than the redundancy provisions of the NES.


Then they also refer to the pattern of service in the industry relying on data from various redundancy funds.


DEPUTY PRESIDENT HAMILTON:  There seems to be a difference between the request and the current Act.  You see, the request refers to a definition of the scheme being an established feature of the relevant industry.  The Act talks about something different.  It talks about must retain the industry specific character of the scheme.


MR CRAWSHAW:  There's no ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  I suppose there's a similarity there.


MR CRAWSHAW:  The difference is in the current Act there's no definition or provision that talks about what the industry specific character is.  That's why I said I was grateful to Ms Adler, because Ms Adler suggested we should go back to the 2009 decision ‑ ‑ ‑


DEPUTY PRESIDENT HAMILTON:  Which is more specific.


MR CRAWSHAW:  ‑ ‑ ‑to see what the reasons why it was found that particular scheme was an industry specific scheme, and the two characteristics that were spelt out there following the request were the question of looking at the benefits in the totality and whether the scheme is an established feature of the relevant industry, and our simple point is that whatever variation is brought about, whichever variation we look at, of the employers, if the scheme is changed to no longer pay employees on resignation one can't say that the scheme is an established feature of the relevant industry because for the last nearly 30 years, maybe more like 27 years, the payment of employees on resignation has been an established feature of the relevant industry, and similarly we would ‑ ‑ ‑


VICE PRESIDENT HATCHER:  I suppose you'd say that the offsetting benefit means that if you removed it the scheme can't any longer be said to be at least as beneficial as the NES.


MR CRAWSHAW:  Yes.  So we say both those factors that guided the 2009 Full Bench to find that there was an industry specific scheme would no longer be present.  As I said we deal otherwise with this matter in our written submissions at paragraphs 53 to 72.  I will be a little time though in elaborating on that.  I don't know whether the Full Bench wants to try and finish redundancy tonight.  I'm ‑ ‑ ‑


VICE PRESIDENT HATCHER:  How much longer will you be?


MR CRAWSHAW:  I could be half an hour.


VICE PRESIDENT HATCHER:  All right.  We'll sit on till 5.30.  If we can try and finish in that time that would be good.


MR CRAWSHAW:  I was going to take you to the test, but you're well aware of the tests under the preliminary jurisdictional issues decision, and, as reiterated in the penalty rates case, so I won't try to re-educate you about the principles, but say how they applied to this particular claim by the employer organisation.


In terms of the prima facie applicability of previous Full Bench decisions we submit that the applicants, to change the industry specific scheme, have raised no new argument.  Further, they have not provided any cogent evidence or reasons to justify a departure from the decision creating the modern award.  We submit that the evidence of the applicants on this issue, as well as other issues, but particularly this issue, is almost totally opinion and hearsay.  We refer particularly again to our, without repeating them, to our objections to the evidence document at paragraphs 3, 4, 9, 10 to 12, 13 to 16 and 24 to 29, and we note in this regard that in paragraph 3 we cite the decision in an earlier case.  I think it was the annual leave case; Mr Maxwell.


There's a statement there about Mr Thomas not qualifying as an expert, and it just so happened that Mr Thomas was an MBA industrial relations practitioner from 1998 to 2013, and we say all the MBA witnesses that sought to address redundancies were similar practitioners, and I notice Mr Schmitke said he wasn't putting anyone forward as an expert in any event.  The same can be said of the HIA witnesses, and in terms of the hearsay, we've made our submission on views of employees.  Ms Adler referred to the evidence of Mr Sassin and Do about members being surprised and shocked.  I think perhaps I shouldn't have gone on.  It's getting late, but I'm talking about the views of employers not employees, but there were members that were surprised and shocked and I think that phraseology was repeated in Mr Sassin and Mr Do's statements.


One wonders why these employers were surprised and shocked about the provision given it had been in the industry for nearly 30 years.  They mightn't have liked it but surprised and shocked?  It doesn't sound credible.  That's the problem when you've got this sort of evidence.  So the HIA evidence was all views as was the CCF survey.  They're nothing but the views of employees and, as we say in our submission, one would expect the views to be in line with what the organisation wanted or one expects the organisation to reflect the views of their members.


I won't deal with the survey of the HIA because it just didn't address redundancy at all.  Mr Maxwell will deal with any reply to what Ms Adler said about that in dealing with the other claims, probably starting with the next one.  We won't come back to the objections document again other than to say what we say about opinion and views and hearsay is repeated in relation to other such evidence in relation to other claims.


So what we say about, as I said, the evidence in this case falls far short of being probative evidence.  In fact there was, in terms of real evidence of facts, the only facts that came forward were from the CCF in the evidence of Mr Hovey and Mr Middleton.  Mr Hovey gave evidence of one employee leaving of his own accord.  I think he was originally a 457 visa employee.  Mr Middleton gave evidence of eight employees leaving in 2016, however, he was not able to give evidence about any redundancies in the years other than 2016, and I refer to PN409 to 417.  Indeed, Mr Middleton at PN423 volunteered that that was a weakness in his evidence.  In any event his evidence demonstrated that 2016 was a particularly bad year, to use his words, because the redundancies were largely caused by the attractiveness to employees moving to the light rail project.  That's at PN411 and 412.


It was that rather than to access the redundancy provisions that motivated those employees as conceded by Mr Middleton at PN422 in an answer to your Honour the Vice President.  Even in 2016 this atypical year the estimated cost of the redundancy of – well, it was $50,000.  That's at PN421.  Which was only one per cent of the total wages bill, which was north of $5,000,000.  That's at PN387.  In fact, the reality of Mr Middleton's firm is that it was a relatively stable workforce for a long time.  That's at PN388.  The bulk of onsite personnel with his company had been employed over a long period of time.  That's at PN366.


VICE PRESIDENT HATCHER:  So the effect of the scheme is that nobody's exempt.  That is, everybody you employ, apart from casuals, will get redundancy benefits at some stage?


MR CRAWSHAW:  Yes.  As long as they weren't dismissed for misconduct or refusal of duty, and apprentices, as I noted earlier.




MR CRAWSHAW:  I'm sorry?


DEPUTY PRESIDENT HAMILTON:  Trainees?  No, don't worry.  It doesn't matter.


MR CRAWSHAW:  The CCF has submitted that even if the facts justify the redundancy clause in 1987 it needs to be proven that they are valid now in 2016.  We would say that's some sort of reverse onus of proof not found in the legislation.  But to the extent that any reliance can be made on changed facts there must be a demonstration that the facts have changed since the making of the modern award in 2009, and this just hasn't been demonstrated at all.  In fact, it hasn't even been demonstrated in evidence by any of the employer organisations that there's been any change since 1989 or for that matter since the sixties, so the CCF's submissions would say the construction industry has changed dramatically with a more mobile workforce and less reliance by employees on long-term permanent employment, and that other changes have taken place in terms of contractor arrangements and the like is just not made out by any evidence.


It's true that Mr Hovey at paragraph 8 did refer to some research that suggested that on an Australia wide basis there was greater flexibility in the workforce.  There's no evidence of the applicability of that to the construction industry and whether mobility has changed.  Indeed Mr Hovey didn't even give such evidence in relation to his own workforce.  Certainly it doesn't describe Mr Middleton's workforce.


VICE PRESIDENT HATCHER:  That was from the HILDA data?




VICE PRESIDENT HATCHER:  I think that data does break down into industry sectors, doesn't it?  That is, if you looked you can find the answer I think.


MR CRAWSHAW:  I may be wrong about that.  In any event, if there has been higher labour mobility that's one of the reasons why the 2009 Full Bench said, or pointed to, in terms of paragraphs 78 and 80 as a reason for the specific industry scheme.  As I said, from its very inception the Commission has been conscious of the fact that there's different types of workforces and has opted for a common provision.


I'm going much quicker than I thought.  Can I just come to the relevance of the Black Coal Mining Award?  We mention that in our submissions not because of the specific scheme being considered there, but because of the principles set out there, particularly at paragraphs 58 to 62.  Most of which we say are applicable here.


VICE PRESIDENT HATCHER:  I thought your client was saying it's wrong.


MR CRAWSHAW:  I'm sorry.


VICE PRESIDENT HATCHER:  I thought your client was saying the decision was wrong.


DEPUTY PRESIDENT GOSTENCNIK:  Another division of his client.


VICE PRESIDENT HATCHER:  Your client has sought a judicial review of that decision.


MR CRAWSHAW:  We have to follow the decision as it is until that occurs, and I don't know anything about that.  Neither does the construction division for that matter.  But in terms of the principles set out there we say the application should be dismissed.  The applications here are not accompanied by probative evidence properly directed to demonstrating the facts supporting the proposed variation.  There are no cogent reasons for not following the previous Full Bench decisions or not proceeding on the prima facie basis that the scheme achieves the modern awards objective.  The fact that the scheme may in some respects have more generous provisions than the NES is not inconsistent with the modern awards objective, and that seems to be the main complaint; that it's more generous in terms of eligibility.


We accept that in terms of the history there is not the same level of consent by the employers, but that is more in relation to recent history than the earlier history.  These provisions were initially introduced largely by consent, and even when it came to Merriman C's decision on the award simplification, as I understand it, the MBA supported the retention of this provision in the award.  Even in 2012 when the HIA sought to have it removed, or changed, I'm sorry, they were on their own.  So although there hasn't been a history of total consent there has been a history of consent of employers in relation to this provision.


VICE PRESIDENT HATCHER:  So in terms of the offsetting factors that the scale is as you go on lower than the NES, and the offsetting benefits are the wider eligibility, that is, to resignation circumstances.  Are there any other offsetting benefits?


MR CRAWSHAW:  Yes, there's the less than 15 employees.




DEPUTY PRESIDENT GOSTENCNIK:  And presumably there are circumstances that involve a termination which are not redundancies but which are also not resignations, dismissal for misconduct or refusal to perform duty, for example, inefficiency.


MR CRAWSHAW:  Yes, I accept that.  I think it's also true to say that although the maximum are less than the NES there's a higher scale earlier on than the NES.


DEPUTY PRESIDENT GOSTENCNIK:  It swings around abouts.




VICE PRESIDENT HATCHER:  It's only fairly slightly higher, isn't it?


MR CRAWSHAW:  Yes.  Unless there's any other questions, they're my submissions.


VICE PRESIDENT HATCHER:  All right.  Submissions in reply, Ms Adler?


MR CRAWSHAW:  I think Mr ‑ ‑ ‑


MR CRAWFORD:  Could I just ‑ ‑ ‑




MR CRAWFORD:  Sorry, your Honour, I'll be very quick.  Given the main issue raised by the employer parties appears to be the cost of the current scheme, as Mr Crawshaw has indicated, they haven't led any evidence to suggest that there is a cost problem, but I refer again to the ABS data that I referred to in my opening submission that it's quoted in our reply submission dated 10 March, and what that ABS data shows is that the industry is performing very well particularly in the period since the modern award has been operating, and we would say surely that ABS industry wide data would have to be preferred to any, at best, anecdotal evidence that the employers have led in this case.


The only other issue is I'd like to hand up some information about the companies that gave evidence from the Civil Contractors Federation.


VICE PRESIDENT HATCHER:  So this is in relation to Mr Hovey and Mr Middleton, or the survey?  Who does this concern?


MR CRAWFORD:  Your Honour, so it's the Diona witness, Mr O'Connor.  The Hovey Group witness, Mr John Hovey and the Woden Contractors' witness, Mr Middleton.


VICE PRESIDENT HATCHER:  Is there any objection to us receiving this material, Mr Boanza?


MR BOANZA:  Yes, I do object, your Honour.  I'm not sure exactly what is the point of this evidence.  We didn't know that it was being tendered and we haven't really had a chance to look at it and see what its contents are in order to comment about any objection.


VICE PRESIDENT HATCHER:  Mr Crawford, shouldn't this have been raised with the witnesses themselves and not raised in this manner?


MR CRAWFORD:  Yes, it's a fair point, your Honour.  All the information is publicly available.  I mean, the information about Diona is from their financial report, but ‑ ‑ ‑


VICE PRESIDENT HATCHER:  That's not the point.  If the point is you're trying to impugn your evidence by reference to the contents of these documents you should have raised it with them, shouldn't you?


MR CRAWFORD:  Yes.  I guess this data doesn't directly conflict with anything in their witness statements.  It's just additional information that we think is relevant, and it is, like I said, publicly available, but I'm happy for the civil contractors to have an opportunity to refute any of the material if they wish.


VICE PRESIDENT HATCHER:  Yes.  No, we won't admit that, Mr Crawford.


MR CRAWFORD:  Thank you.  Nothing further.


DEPUTY PRESIDENT GOSTENCNIK:  Mr Crawford, sorry, before you resume your seat just apropos an earlier submission that you made in relation to the absence of any conciliation about the exposure draft and the impact that might have on allowances.  You recall that?


MR CRAWFORD:  Yes, your Honour.


DEPUTY PRESIDENT GOSTENCNIK:  Watson Senior Deputy President prepared a report which you'll be familiar with, and in paragraph 31(v) it seems that the Senior Deputy President had in mind that such conciliation would occur after the determination of the applications to vary or delete the various allowances, so that I'm not sure where that takes the point that you made earlier that we should be cautious about varying certain things because they might be conciliated away.


MR CRAWFORD:  Yes.  I guess the point I was making was that there have been questions from the Bench which have raised aspects of the award regarding wording that could be clearer.  I guess the point I was primarily making was the exposure draft process will address a lot of those issues.  That will obviously follow these proceedings.


DEPUTY PRESIDENT GOSTENCNIK:  Yes.  All right.  Thank you.




MS ADLER:  Thank you, your Honour.  Just four brief comments on what's been point by my friend.  Firstly, in relation to that 2009 decision of AICFB 345 and the characteristics that were considered by that Full Bench in relation to an industry specific scheme, and while they might provide some information for this Bench when considering what an industry specific scheme looks like, that needs to be weighed up against the modern awards objectives which is what is the framework within which this review is being carried.  I'd also note that under the current Act in section 12 there is a definition in the industry specific redundancy scheme which basically says means:


Redundancy or termination payment arrangements in the modern award are described in the award as an industry specific redundancy scheme.


So I don't know how altogether helpful that is but what I would say is that the variations proposed don't effect – well, our submission is they don't effect the industry specific character so aren't at odds with section 141.


VICE PRESIDENT HATCHER:  I think the point the CFMEU makes having regard to the 2009 decision is that the character of the scheme was marked as a balancing between, in some respects, lower redundancy benefits with corresponding other benefits in terms of the wider scope of coverage.  So on one view by taking out the wider scope of coverage you're unbalancing the scheme, and destroying its industry character.  That is, you end up with a scheme that's less beneficial than the NES without any of the corresponding advantages which caused the Commission to approve it in the first place.  You might say that goes back to a primary position to abolish it altogether but if you get back to the alternative position it seems to me that that's right, isn't it?  It changes the balance of the scheme in terms of benefits and detriments to employees and employers?


MS ADLER:  I'd still suggest that the retention of the payment scheme in the current provision retains an element of that balance.  I take your point that by amending that definition or changing who it applies to distinguishes that from what has historically been the case, but I think we need to view those changes and whatever offset or balancing proposition was put when this provision was developed against the current framework and the job during this four yearly review about the modern awards objectives and whether or not the award, as it is now, meets those objectives.


VICE PRESIDENT HATCHER:  We follow from your primary case that there could no longer be an exemption for employers who contribute to the industry scheme?


MS ADLER:  An exemption in what sense?


VICE PRESIDENT HATCHER:  The current scheme provides that if you contribute to the industry scheme ‑ ‑ ‑




VICE PRESIDENT HATCHER:  ‑ ‑ ‑you don't have to do anything under the award clause and you're effectively exempt from the NES as well.  If we scrap the industry scheme you'd simply have the NES operating, and anybody contributing to the industry scheme could not have an exemption that they currently have.


MS ADLER:  I might characterise it as an offset instead of exemption.


DEPUTY PRESIDENT GOSTENCNIK:  But how would those contributing have offset?  Because most obligations to make contributions arise out of an agreement.




DEPUTY PRESIDENT GOSTENCNIK:  And the term of an agreement can't exclude the operation of an NES provision or any of its terms, and so that if the NES applied then those employers covered by enterprise agreements would have the double whammy of having to make payments pursuant to the NES and continue their contributions under the obligations in the agreement.


MS ADLER:  I guess my membership predominantly not covered by enterprise agreements predominantly not subject to those funds and how they're arranged.  I do understand that each fund operates almost on its deed and in its own way.




MS ADLER:  I wouldn't want to be presumptuous but there may be ways within that mechanism to deal with these issues.  I don't know.  Our primary position comes from those of small business who, in the residential construction industry, were having to pay under this provision when employees resign, and I guess that's as much information as I can provide to the Bench on that.


The second matter that I'd just like to raise, and it's a nuance that hasn't sort of been raised yet, and that's when the modern awards were made, particularly in the on-site award, there was an introduction of weekly hire arrangements across the board.  Prior to that we had daily hire which applied to most classifications, but with the introduction of weekly hire engagement I would say that that changed the nature of engagement under the award, and that the proposition that the industry specific scheme dealt with the itinerant project base nature of the industry which may have been true at the time, with the introduction of weekly hire employment, there was definitely a shift in the character of how engagement was made under the award, and that hasn't been raised yet so I just wanted to bring that to the attention of the Bench.


The third matter that I'd just briefly like to raise is Mr Crawshaw talked about proponents of application needing to prove a significant change in circumstances in order for the Bench to grant a variation application, and on reviewing the preliminary issues decision [2014] FWCFB 1788 at paragraph 60 where the Bench summarised the circumstances wherein each review would take place and I quote the Bench stated that:


However, where a significant change is proposed it must be supported by a submission which addresses the relevant legislative provisions and be accompanied by probative evidence properly directed to demonstrating the facts supporting the proposed variation.


So we're not talking about needing to prove a significant change in circumstances.  We're talking about where a significant change is proposed it has to be supported by evidence.  I just wanted to point out the difference between what is actually the framework when this review is carried out and what Mr Crawshaw had put earlier.


The final point just raised about the cost of the scheme, well, I'd think we'd say it's clear on its face, and in our submission we provide an example of how that cost manifests when somebody resigns; a simple calculation of the wage rate times the number of years that particular employee has been engaged.  Really saying that the industry is performing well, and, you know, we're in a boom cycle at the moment I don't think says much about the cost impact on a small business and how detrimental that can be.  That's all I wish to say.  Thank you, your Honour.


VICE PRESIDENT HATCHER:  Thank you.  Mr Schmitke?


MR SCHMITKE:  Your Honour, having reference to the time, I was actually going to seek that the CCF perhaps respond before me.  There is a document that I would wish to refer to that I regrettably don't have with me.


VICE PRESIDENT HATCHER:  I think we want to finish this tonight, so what's the document?


MR SCHMITKE:  It was a submission that has been made in relation to the casual and part-time matter that deals with very similar issues that we're canvassing here, particularly with respect to the occupational limitation of the former types of employment within the industry, and it to some extent perhaps explains why there is some contention about the impact; why people are shocked and surprised about why it is that they're forced to make redundancy payments.  It's that document and the specifics therein that I'd like to have regard to and I just don't think I have ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  What is it?  A piece of evidence is it?


MR SCHMITKE:  It was a submission that we put elsewhere in these proceedings regarding casual and part-time employment.


DEPUTY PRESIDENT HAMILTON:  What's the submission?  Just give us the ‑ ‑ ‑


MR SCHMITKE:  The flavour is, of course, that essentially when the award was modernised it introduced in to an industry the notion that you can have basically permanent weekly employees, permanent part-time employees on top of the daily hire arrangement and casual employees that were features ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  Sorry, but daily hire arrangements didn't apply universally.  I think they were ‑ ‑ ‑


MR SCHMITKE:  That is the case, yes.




MR SCHMITKE:  But certainly for our members who apply to this award that was the case.


DEPUTY PRESIDENT GOSTENCNIK:  That is in Queensland and New South Wales from memory?


MR SCHMITKE:  I can't ‑ ‑ ‑


DEPUTY PRESIDENT GOSTENCNIK:  Certainly not Victoria or ‑ ‑ ‑


MR SCHMITKE:  Yes.  Yes, your Honour.  Yes.  Yes.




MR CRAWSHAW:  I don't see how this arises in reply in any event.


VICE PRESIDENT HATCHER:  So what's the point of all this?


MR SCHMITKE:  The point is that there has been a circumstance, or there has been changes to the circumstances in the industry insofar as the way in which workers are engaged and the different types of employment methods that are utilised, so in the past when this scheme was established it was established in the situation that took account of the peculiarity that existed and, of course, that peculiarity is lessened now by virtue of the fact that we have all the categories of employment type applicable in the sector whereas in the past it was restricted.


VICE PRESIDENT HATCHER:  That's happened when the Full Bench inserted the scheme in the award, so they knew that was happening.  They made a decision.  Unless you're saying that decision was wrong?  You're pointing to changed circumstances.  I'm not sure where this goes.


MR SCHMITKE:  I'm not asserting that the decision was wrong.  The decision that was made at the time was made with respect to a provisional requirement under the then modern award request.  But defining the scheme as industry redundancy scheme potentially is made in isolation of the consequences of therefore introducing the different categories of employment into the award more broadly, so if you categorise a redundancy scheme as an industry redundancy scheme but elsewhere there's a change to the types of employment that can be utilised within the industry by default you've expanded the nature of that scheme.


VICE PRESIDENT HATCHER:  The Full Bench did all these things simultaneously.  That is, it made a modern award with additional categories of employment in an industry specific scheme which are found to be an industry specific scheme.




VICE PRESIDENT HATCHER:  That's what happened and that's what we've got in front of us, so unless you're saying that was marked by some sort of error which we can now correct I'm not sure where that all goes.


MR SCHMITKE:  There are other consequences that have flown from that.  Proceedings elsewhere in relation to daily hire, follow the job loading.  Those type of matters weren't necessarily comprehended by the Bench at the time that those provisions got inserted and they have caused problems.


VICE PRESIDENT HATCHER:  That's an ambiguity that needs to be resolved, but there's no ambiguity here, is there?


MR SCHMITKE:  This is just, I suppose, the reference to the fact that there are characteristics in the sector that have changed since the scheme was established, so if the CFMEU talks about, you know, it's been accepted for 30 years and so on and so forth, what we would say is that there has been some changes that the Commission ought to have regard to.


MR CRAWSHAW:  There's simply no evidence that that proposition was put from the Bar table.  Even accepting that the award has changed there's no evidence of any change as a result of that.  It's been brought in these proceedings and it's been put for the first time by Mr Schmitke in reply.


VICE PRESIDENT HATCHER:  All right.  Anything further, Mr Schmitke?


MR SCHMITKE:  No.  No, nothing further.




MR BOANZA:  Nothing further.


VICE PRESIDENT HATCHER:  Anybody else?  All right.  Thank you.  That completes the redundancy issue.  We'll move to the next item when we commence at 9.30 am in the morning.


MR NGUYEN:  Your Honour, it's Mr Nguyen in Sydney.  Can I just see leave to be absent from the proceedings tomorrow.  I have to attend a ‑ ‑ ‑


VICE PRESIDENT HATCHER:  Yes, you have that leave.


MR NGUYEN:  Thanks.

ADJOURNED UNTIL TUESDAY, 11 APRIL 2017                          [5.28 PM]