PN5670

VICE PRESIDENT HATCHER: Are there any housekeeping matters before we begin? No, all right. The next - yes, there is.

PN5671

MR SCHMITKE: Further to yesterday's discussion with respect to the shift provisions, I have had some discussions with Mr Maxwell yesterday afternoon and again this morning. It appears as though we are on track to get somewhere, but we aren't in a position, I don't think, to advise the Commission this morning as to any actual agreement reached. It would be my proposition for the Commission's consideration to perhaps allow the parties a particular period of time. If we don't advise you in that period that we've reached agreement then I suppose the matter can be determined.

PN5672

VICE PRESIDENT HATCHER: All right. Obviously at any time - better sooner rather than later, but at any time before the decision is issued the parties reach an agreement they can advise us of that and we'll take it into account.

PN5673

MR SCHMITKE: Thank you, your Honour.

PN5674

VICE PRESIDENT HATCHER: All right. Ms Adler, are you next?

PN5675

MS ADLER: Yes, thank you, your Honour. So this variation application is in relation to ordinary hours of work which is clause 33 of the On-site Award and is outlined in our written submissions at part 8 of those submissions, which is page 51 and the draft determination that we seek is at attachment N of those submissions.

PN5676

So I might just start - I know that there was some discussion of this provision last week, but I might just briefly outline what the current provision provides to provide some context within which we seek the changes that we do. So currently ordinary hours ‑ ‑ ‑

PN5677

DEPUTY PRESIDENT HAMILTON: Are you seeking in essence the removal of the various restrictions, namely banking restricted to distant work, the use of the words "nominated" and "prescribed"? Is that it?

PN5678

MS ADLER: No, it's slightly broader than that. So there's three aspects to the proposed variation. The first is to introduce an averaging of hours system, the second is to allow where the RDO system is retained the employer to either nominate a day for all employees to take the RDO or to fix different days in the cycle or agree by majority agreement on another alternative arrangement, and the final aspect is the one that you mention about banking of RDOs, which currently only applies to distant work employees, and we would propose that that apply broadly across all employees by agreement also.

PN5679

DEPUTY PRESIDENT HAMILTON: In any event, you want to remove "nominated" and "prescribed" given the confusion that has erupted over the use of the terms.

PN5680

MS ADLER: That's the MBA's claim. We would support the claim, but that's not specifically what we're seeking in our proposed variation.

PN5681

DEPUTY PRESIDENT HAMILTON: Understood.

PN5682

MS ADLER: Although it would make changes holistically to the way the provisions are now, but in essence we retain the RDO system with some amendments and introduce an averaging of hours system. So they're the three aspects of the claim.

PN5683

The HIA survey deals with this issue and from the responses to that survey it would seem that there are a variety of ways that employers in the residential construction industry arrange hours of work, and so we say based on that the award as it currently is doesn't provide enough flexibility in the way arrangements for working hours are made to suit the needs of the industry.

PN5684

There has been some discussion of what options there are already under the award in relation to agreeing to alternate RDOs, particularly clause 33.1(vii) about arrangements on working other than the rostered day off system.

PN5685

VICE PRESIDENT HATCHER: Ms Adler, can we just take a step back?

PN5686

MS ADLER: Yes.

PN5687

VICE PRESIDENT HATCHER: The variation of 33.1, that's to remove the span of hours?

PN5688

MS ADLER: No, the span of hours would remain. So item 2 of the draft determination retains the rostered day off cycle in the same manner that it is now, retains its current spread of hours.

PN5689

VICE PRESIDENT HATCHER: I see.

PN5690

MS ADLER: Then the proposed 33.2 provides options for determining the rostered day off where the RDO system is retained, and there are three options there. Then we retain the current provision about pro rata entitlements and how it's calculated if you don't actually work the full 19‑day cycle and what entitlement you are entitled to in that circumstance.

PN5691

Proposed clause 33.4 deals with banking of RDOs and then 33.5 is the existing provision about the penalties you're entitled to for working on an RDO and then clause 33.6 is the provisions in relation to averaging of hours, which is based on the provisions that are currently in the joinery award and the timber award. So it's not a foreign concept to the construction industry to have an averaging provision, it just hasn't been in the On-site Award.

PN5692

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

PN5693

MS ADLER: So we rely on the survey responses to support our claim. We also rely on the statement of Lauren Marantz which was marked exhibit 29 and is attached at attachment O to our submissions, and that statement and the attachment to that statement which is marked Annexure A outline the arrangements that members enter into under individual flexibility arrangements.

PN5694

We refer to that to support the notion that greater flexibility is sought, that the RDO system is one of the aspects of the award that employees seek to vary under those arrangements, and in the majority of cases that are listed in that annexure removing the RDO and then incorporating some overtime are definitely characteristics of most of those individual flexibility agreements.

PN5695

Notwithstanding that, IFAs can deal with arrangements when work is performed. We say that the variation we propose is still necessary in relation to averaging of hours and we would refer to comments made in that award flexibility decision I referred to earlier in relation to the difference between a facilitative provision and the model flexibility term, and in that decision the Full Bench identified, and I quote, "That there are significant conceptual and practical differences between those provisions."

PN5696

I would refer to paragraphs 138 to 141 of that decision where the Full Bench basically says that the model flexibility term, and in that case obviously the TOIL term, are different. They operate in different ways. They don't necessarily limit or interact inadvertently with each other, and I guess the bottom line is that a facilitative provision applies more narrowly than the individual flexibility arrangements but we would say provides more certainty. The IFA is obviously subject to the BOOT, whereas what we propose is an award term and employers and employees can look at that and completely understand the expectations in relation to what's required under those provisions.

PN5697

I would also note that section 63 of the Fair Work Act permits the inclusion of modern award terms in relation to the averaging of hours of work, so it's something that's contemplated more broadly and we say gives the Bench permission to insert the sort of provision that we seek.

PN5698

The only final observation that I would make in relation to clause 33 of the On-site Award is that I think it's generally agreed that the construction industry goes through ebbs and flows, booms and busts. It's a very cyclical industry, yet we say that the current provision doesn't actually provide any real mechanism to deal with those cyclical arrangements.

PN5699

I know the unions will say that we have daily hire engagement to deal with that and our response to that would be, well, we'll also have weekly hire arrangements in the award which are used by HIA members and that we need to have provisions in the award which can equally accommodate those that use weekly hire arrangements, and we don't currently have that. That would be our submission.

PN5700

We also say that the entire industry no longer just operates on daily hire. There are a range of ways that work is organised across the sector and we say that's not reflected in the award as it currently is, and so we would submit that our variation would assist in the award better meeting the modern awards objectives. That's my submission. Thank you, your Honour.

PN5701

VICE PRESIDENT HATCHER: Thank you. Mr Schmitke, do you want to go next?

PN5702

MR SCHMITKE: I'm sorry, your Honour?

PN5703

VICE PRESIDENT HATCHER: Do you want to go next?

PN5704

MR SCHMITKE: I think there's - yes, I may be going next, and I'll be brief. The claim we advance in this area is with respect to the same clauses, essentially, that Ms Adler just covered. They're dealt with at items 17, 18 and 19 in our 2 December submission, seek to vary the clause 33.1(a)(ii), (iii) and (iv), pages 71 and 72 of the award.

PN5705

The nature of what we seek I think was virtually ventilated in the taking of evidence. A wording change at 33.1(a)(ii) to remove the prescriptive references to nominated industry rostered day off, to delete clause 33.1(a)(iii) and replace it with a new provision allowing agreement to be reached on banking RDOs, effectively extending the existing provision which is currently restricted by way of distant work only and to delete clause 33.1(a)(vi) and replace it with a new provision allowing for what we say is a broader range of options to deal with circumstances where work is required and is substituted - or RDO.

PN5706

I'm not going to take the Commission through in any real detail the specifics of the background of the confusion that we say arises with respect to this provision. I think it was very clear ‑ ‑ ‑

PN5707

VICE PRESIDENT HATCHER: I think we had a fairly long discussion about this last week.

PN5708

MR SCHMITKE: Indeed. There are a couple of things I just would add. The first is that I think it's helpful to have regard to the predecessor provision in the previous award. I do have copies of that provision if it would assist. If I might hand them up.

PN5709

Your Honours and Commissioners, that is the pre modern award version of the clause which is the subject of our claims and when you do a compare and contrast of that particular document you can see how it is that we've ended up with certain provisions remaining in the modern award that have linkages back to certain earlier provisions, and it is that context within which this particular existing clause has created the confusion that we say exists, particularly if I can draw your attention to clause 27.2.3, which is a practice that no longer takes place.

PN5710

VICE PRESIDENT HATCHER: When did that fall out? At the award modernisation stage, did it?

PN5711

MR SCHMITKE: Yes.

PN5712

VICE PRESIDENT HATCHER: Is there any explicit decision discussing that?

PN5713

MR SCHMITKE: I'm not aware of any. What I would say about our three claims and what the unions said is that they would oppose these changes. The first change we seek is simply a provision to remove an out of date reference. It's manifestly a hangover from the past, it reflects a practice that no longer exists and uses a phrase that isn't defined, and it's a source of confusion in our submission.

PN5714

The second change again is not too dramatic in the context of this clause. It removes the distant work limitation allowable - or currently restricting banking to those people engaged in distant work so it would see existing flexibilities made available to a broader range of people.

PN5715

The third provision is one, of course, which we would prefer, but I understand that the CFMEU would push back on this provision quite hard, and in fact they have in their submissions.

PN5716

What they do is they say that this is a diminution of existing entitlements, and what that does is actually identify a longstanding, I suppose, disagreement within the sector about the application of this particular provision arising from its modernisation.

PN5717

I'm minded that the Commission may well think that the third option, or amending that third provision, is a bridge too far, and I would simply note that if the Commission is not minded to go with us on that point then we would invite the Commission to contemplate an alternative to our second alteration, which is the banking, but also allow a cashing out option in that same clause.

PN5718

VICE PRESIDENT HATCHER: So is that set out in a variation somewhere?

PN5719

MR SCHMITKE: It isn't. I can provide one. It would be an alternative position.

PN5720

VICE PRESIDENT HATCHER: Yes, all right. Can you provide that at some stage?

PN5721

MR SCHMITKE: Yes. Otherwise, unless there's any other additional questions, they are our submissions.

PN5722

VICE PRESIDENT HATCHER: Thank you. Any other employer submissions on this issue? No. Mr Maxwell?

PN5723

MR MAXWELL: Thank you, your Honour. Your Honour, if I could deal with the matters raised by the HIA first. In regard to the HIA - sorry, I withdraw that. The CFMEU reply submissions at paragraph 199 to 211, which is - 199 is found on page 79 and 211 is on page 82 - deal with the issue of the ordinary hours of work. In regard to HIA variation, we oppose the variation. The current award provides for a fixed RDO under the award under 33.1A unless there is agreement between the employer and employees to work a substitute day - sorry, to take a substitute day.

PN5724

Significantly, under the HIA proposal they seek to remove the requirement for an agreement with employees. They seek to change the award to allow the employer to fix an RDO, and Ms Adler took you to that in her submission. The issue of ordinary hours of work for this award was dealt with extensively during the award modernisation proceedings. In paragraph 2014 of our written submission we detail all the submissions that were made during the award modernisation proceedings which sought to change the provisions of the award, and despite all our submissions the Full Bench in the award modernisation decided to insert the provision that's contained within the award.

PN5725

Again in 2012 the issue of the hours of work under this award were significantly dealt with by Senior Deputy President Watson. In that matter there was an application by the CCI of WA who sought the averaging of hours and that was rejected by SDP Watson, and we refer to that in paragraph 205 of our written submission.

PN5726

The HIA also made a similar application to vary the award to provide for the averaging of hours and that was also dealt with by Senior Deputy President Watson in 2012 and we refer to that in paragraph 206 of our written submission.

PN5727

In the current application the evidence relied on by the HIA is its survey, which we have objected to, and I rely on the written objections that we have previously made, and in regard to the survey the only questions asked in the HIA survey only related to an RDO system and whether the employer worked an RDO system and the question on the preferred options, which included a reference to the averaging of hours. The HIA survey did not deal with how RDOs are to be taken, nor did it deal with the banking of RDOs.

PN5728

In regard to Annexure A to the statement of Ms Marantz, significantly there's only 43 IFAs that are within the bank of - sorry, I'll just refer - the IFAs are taken from a resource bank of knowledge of the HIA. I'm just trying to find the exact terminology that was used. That's right, it says, "The HIA's HR docs is a comprehensive online library of HR documents that the HIA uses." In that comprehensive online library, since 2014 the HIA only has 43 IFAs, and those IFAs only cover 25 companies. Of those 43 IFAs 15 of them don't mention RDOs.

PN5729

The other point I wish to make in regard to the HIA variation is in their submission at 8.45 they say that the use of an RDO system is mandatory under the award. Quite clearly that's incorrect, and that was brought out during the cross‑examining of Mr Spence, and as they say, "Employers and employees can make alternative arrangements under an IFA."

PN5730

We submit that as paragraph 8.4.17 of the HIA submission deals, the cost the HIA members complain of is having to pay a higher rate of pay to incorporate working hours that would otherwise attract overtime payments, and that is why they seek this averaging arrangement. Viewed through this prism, the real intent of the variations sought by the HIA becomes clear.

PN5731

DEPUTY PRESIDENT HAMILTON: Isn't so they can match working hours to providing labour in a more efficient way?

PN5732

MR MAXWELL: Your Honour, under the award if an employee works on a Saturday or a Sunday they are paid overtime rates. If you turn to the variations sought by the HIA which is in clause 33.6 of their draft order, there is no mention of what the ordinary hours of work are where the hours are averaged.

PN5733

DEPUTY PRESIDENT HAMILTON: Fair enough.

PN5734

MR MAXWELL: The only mention of specific ordinary hours of work are under the rostered day off cycle under 33.1. We would also point out that in 33.5 of the (indistinct) order which deals with working on an RDO - and it provides that:

PN5735

An employee who works on a paid RDO that was fixed in accordance in clause 33.2 on a substitute day must be paid in accordance with the provisions prescribed for Saturday work in clause 37 of this award.

PN5736

There is no identification of what happens to the accrued time for the RDO, because under the current provisions of the award, under 33.1(a)(vi), if an employee is required by the employer to work on an RDO ‑ ‑ ‑

PN5737

DEPUTY PRESIDENT HAMILTON: I follow. You've made your point.

PN5738

MR MAXWELL: Yes. So we submit that in regard to the HIA, they haven't provided corroborative evidence to support the variation, nor is there substantial merit to the case, and as it reduces their existing entitlements of workers it should be rejected.

PN5739

If I can then briefly deal with the MBA's claim. In regard to the MBA claim for ordinary hours of work the only evidence that the MBA rely on is the witness evidence of Mr Spence. In regard to that we again rely on our objections to that evidence which is dealt with in our written submission on objections to evidence. We'd also say in regard to the evidence of Mr Spence that his knowledge of the award in this area is limited, to say the least, and I'd refer the Commission to the transcript at PN 2044 and PN 2045. He stated that he wasn't familiar with the changes being sought. That's found in PN 2057.

PN5740

VICE PRESIDENT HATCHER: Mr Maxwell, does the CFMEU oppose the change at 33.1(a)(ii)? Because I thought you said the words used there meant what the MBA wanted them to mean anyway?

PN5741

MR MAXWELL: We do.

PN5742

VICE PRESIDENT HATCHER: I mean, the words "nominated industry rostered day off" have no role to play in this clause, do they?

PN5743

MR MAXWELL: We say that they're the days identified in 33.1(a)(i).

PN5744

VICE PRESIDENT HATCHER: Yes.

PN5745

MR MAXWELL: Our alterative to the MBA proposal would be to say "the nominated industry rostered days off as prescribed in clause 33.1(a)(i)."

PN5746

VICE PRESIDENT HATCHER: That's not the expression used in 33.1(a)(i). I mean, this is just opposition for the sake of it, isn't it? I mean, you're saying the same thing. Why can't we use words which obviously link (ii) with (i) in circumstances where "industry rostered day off" is not the expression used in (i)?

PN5747

MR MAXWELL: Your Honour, I don't take a - we accept that the wording proposed would have the same effect.

PN5748

VICE PRESIDENT HATCHER: Right, thank you.

PN5749

MR MAXWELL: In regard to the change to 33.1(a)(iii), again we oppose that variation, and just in regard to - sorry, your Honour, the issue of the banking of the RDOs, quite clearly the issue of banking of RDOs on distant work is because if you're working on a distant project and you take an RDO, if you're stuck in camp what are you going to do? That is why the provision for the banking of RDOs on distant work was introduced.

PN5750

Now what the employers are seeking is to extend that, which we - in essence actually reduces the effect of why the RDO and the shorter working hours was introduced, because it means that people will continue to work 40 hours a week infinitum and then perhaps get a chance to take an RDO at a later date.

PN5751

DEPUTY PRESIDENT HAMILTON: That's not fair, is it? I mean, they get the time off, it's just done at a time which is consistent with efficient work at the workplace, isn't it? Isn't that the difference?

PN5752

MR MAXWELL: No, the difference is under the RDO system it means that construction workers who normally work a six‑day week get at least two days off once every four weeks. If the banking is introduced then effectively you remove that entitlement and building workers will then be required to work ‑ ‑ ‑

PN5753

DEPUTY PRESIDENT HAMILTON: We're talking at cross‑purposes. I agree with you. It's just that the time off is at a different time, that's all. I do agree with you. I'm not arguing with you so there's no need to go any further. I follow what you're saying.

PN5754

MR MAXWELL: The only other point I'd make in regard to the banking of RDOs is the if you look at - Mr Schmitke has handed up the clause from the pre‑reform National Building and Construction Industry Award, and if I can take you to clause 27.2.5(a) and you will see that under the previous award there's a provision that said that where the majority of employees agree to the banking of RDOs then those RDOs are to be drawn upon by the employee at times mutually agreed by the employer or subject to reasonable notice by the employee.

PN5755

So under that provision, at least, the employee wasn't subject to a veto by the employer as to - a total veto by the employer as to when they could then take those RDOs. It did allow for the employee to give reasonable notice of when those RDOs were to be taken.

PN5756

DEPUTY PRESIDENT GOSTENCNIK: So does it follow, Mr Maxwell, that the CFMEU would not oppose a banking of RDOs if it were attached to the capacity of the employee on reasonable notice to take the RDO?

PN5757

MR MAXWELL: To be blunt, your Honour, I think if I agree to that I may be looking at elsewhere for employment, but I would suggest that that may address some of our concerns.

PN5758

Then in regard to paragraph 33.1(a)(vi), again we only have the evidence of Mr Spence, and at PN 1995 during cross‑examination and questions asked by your Honour the Vice President, he said he didn't have a problem with the interaction of clauses 33.1(a)(vi) and 33.1(a)(ii). We say we oppose the variation. It would reduce employees' entitlement when required to work on an RDO, because under their option it doesn't mention what happens to the RDO accrual and it reduces the penalty that is payable where the employer requires the employee to work on the RDO. If it is a day that's agreed between the parties, well, then that issue doesn't arise. It's then paid at ordinary time rates.

PN5759

Your Honours and Commissioners, they're the submissions I wish to make in regard to those aspects of the claims.

PN5760

VICE PRESIDENT HATCHER: Thank you. Anything in reply?

PN5761

MR CRAWFORD: Yes, sorry, your Honour.

PN5762

VICE PRESIDENT HATCHER: Sorry, Mr Crawford.

PN5763

MR CRAWFORD: Just briefly, the AWU does not opposed to clause 33.1(a)(ii) being clarified, as has been discussed. We're opposed to the remainder of the claims and we simply say a sufficient merit case hasn't been presented. Hours of work are obviously a fundamental and very important condition in any award and they shouldn't be changed lightly. A substantial case needs to be run before they should be varied.

PN5764

VICE PRESIDENT HATCHER: Thank you. Anything in reply?

PN5765

MR SCHMITKE: Yes, your Honours and Commissioners. I would simply just remind the Commission that Mr Spence didn't have a copy of the award in front of him when he's being asked these questions and sat through the debate. I think we should have regard to that.

PN5766

I just would also like to note that Mr Maxwell's position effectively is that he's happy to allow RDOs for people to be banked when they can't use them, but when they can use them, which is the rest of the sector, he won't let them use them. That's the effect of the provision and that's completely inconsistent with the modern awards objective in terms of trying to make this type of arrangement more flexible across the industry.

PN5767

MR MAXWELL: Do you want to add anything, Ms Adler?

PN5768

MS ADLER: Just a quick point, picking up on Gostencnik DP's comments in discussion with Mr Maxwell. Our proposed provision 33.4 includes wording which would require that the banked RDOs be taken at times it's mutually convenient to the employer and the employee, that either party is required to give five days' notice before taking a banked RDO, and things about employer requiring to keep records of these sorts of things. From memory, what was read out from the pre‑reform award, the conditions that we propose is in a similar way to what was in the pre‑reform award. Thank you, your Honour.

PN5769

VICE PRESIDENT HATCHER: Thank you. So have we dealt with all the ordinary hours issues?

PN5770

MR MAXWELL: Your Honour, there is one matter that's raised by the CFMEU that's identified in the document on page 9. You'll see halfway down the page there's ‑ ‑ ‑

PN5771

DEPUTY PRESIDENT GOSTENCNIK: Daily ordinary hours of casual employees.

PN5772

MR MAXWELL: That's correct. Your Honour, I'll be brief on this matter. We address this issue in our written submissions in paragraphs 191 through to 196. The issue arises - and we refer to correspondence that was sent to the Commission by the Fair Work Ombudsman in March 2015 which identified a number of clauses in this award from the queries commonly raised by the FWO which may be of uncertainty for workplace participants.

PN5773

One of the issues raised by the FWO is set out in paragraph 192 of our written submission and it relates to the ordinary hours of work for casuals, because the FWO believes that the award is not clear as to how you determine the ordinary hours of work for casuals and then when overtime rates will then kick in. This issue was discussed between the parties during the consultation before his Honour SDP Watson and unfortunately no agreement was reached and arbitration is required.

PN5774

The clause that we propose is set out in paragraph 194, and in effect it's an addition to clause 33.1, which provides that the maximum ordinary hours for a casual employee should be eight hours per day and 38 hours per week, work between 7 am to 6 pm. So in essence we are saying that the ordinary hours for casuals are the same as every other employee under the award and from there you can then determine the ‑ ‑ ‑

PN5775

DEPUTY PRESIDENT GOSTENCNIK: I must admit, that's how I'd read clause 33 now.

PN5776

MR MAXWELL: That is how we read it and that's how - our understanding is that SDP Watson read that clause, however given that the FWO has raised that they believe there is uncertainty, we would seek that that matter be clarified, so then it can remove any uncertainty that exists. I won't take the issue any further. That is the basis of the variation that we seek.

PN5777

MR CRAWFORD: Your Honour, can I just note that the AWU strongly supports this claim. It's a problem that AWU officials have raised as well. We certainly think the award is crystal clear at the moment, that casual employees are entitled to overtime if they work more than eight hours on any day or shift.

PN5778

I'd refer in particular to paragraph 274 of Senior Deputy President Watson's decision in the 2012 transitional review. That's (2013) FWC 4576. In that paragraph he made it clear that is how the award applies, but given there is some confusion in the industry we think it is a matter that should be clarified in accordance with the CFMEU variation.

PN5779

VICE PRESIDENT HATCHER: Thank you. Employer response?

PN5780

MS ADLER: Thank you, your Honour. We deal with this issue in our reply submission dated 16 March at section 3.6. We oppose the variation. We say there's no confusion, and in fact what's proposed has the potential to create confusion, in that it specifies that overtime will be applicable to casuals either per day and/or per week.

PN5781

So at paragraph 3.6.3 we provide an example, albeit a hypothetical example, of where a casual employee could work 40 hours a week but that's sort of split up throughout the five days of the week and then when you go back to work out how much overtime is paid is it two hours over the 38 or is it calculated on each day over the 7.6 or eight hours?

PN5782

So the proposal that's being put, our view is it would actually create more confusion than what we've currently got now. The Fair Work Ombudsman has their own view of how that works and I've extracted that in the submission as well. They say that casuals get overtime rates if they work more than the maximum number of ordinary hours of work per week only or outside the spread of ordinary hours.

PN5783

VICE PRESIDENT HATCHER: So they don't get overtime if they work more than eight hours a day.

PN5784

MS ADLER: That's right.

PN5785

VICE PRESIDENT HATCHER: Why is a casual different from any other employee in that respect?

PN5786

MS ADLER: We say that they're not, that a fulltime employee's overtime is calculated on a weekly basis. That's all I wish to say, your Honour. Thank you.

PN5787

DEPUTY PRESIDENT GOSTENCNIK: Doesn't that construction involve a de facto averaging? 36.2 says, "All overtime work beyond an employee's ordinary hours of work must be paid" - et cetera. "Ordinary hours of work for a Monday are to be performed between 7 am and 6 pm, with work being of eight hours' duration."

PN5788

MS ADLER: I guess you have to factor in the RDO system into that as well. That's part of what the ordinary hours are.

PN5789

DEPUTY PRESIDENT GOSTENCNIK: That's an accrual issue.

PN5790

MS ADLER: Yes.

PN5791

DEPUTY PRESIDENT GOSTENCNIK: So 7.6 hours of work with .4 hours or thereabouts being accrued to an RDO. That's the way it works.

PN5792

MS ADLER: Yes.

PN5793

DEPUTY PRESIDENT GOSTENCNIK: So that for a casual employee - or any employee who works nine hours on a particular day, it's overtime, isn't it, otherwise you get into averaging?

PN5794

MS ADLER: With respect, I don't know if I completely agree with that application.

PN5795

DEPUTY PRESIDENT GOSTENCNIK: 36.2 isn't confined to overtime in a week. It's for all work ‑ ‑ ‑

PN5796

MS ADLER: It all refers back to the ordinary hours of work.

PN5797

DEPUTY PRESIDENT GOSTENCNIK: Which again you go back to the clause, which provides for how ordinary hours are to be worked.

PN5798

MS ADLER: Yes.

PN5799

DEPUTY PRESIDENT GOSTENCNIK: Otherwise the words "eight hours worked in each day" are superfluous.

PN5800

MS ADLER: It sets up an actual working week ‑ ‑ ‑

PN5801

DEPUTY PRESIDENT GOSTENCNIK: If you succeed in your averaging claim that might change the circumstance, but in any event ‑ ‑ ‑

PN5802

MS ADLER: No, no ‑ ‑ ‑

PN5803

DEPUTY PRESIDENT GOSTENCNIK: ‑ ‑ ‑ I don't think we need to debate it further. You have a view, I have a view.

PN5804

MS ADLER: Yes. I guess that the basis on which we oppose this particular variation is that what's proposed would actually create more confusion than what we have now.

PN5805

Thank you, your Honour.

PN5806

DEPUTY PRESIDENT GOSTENCNIK: I understand that point.

PN5807

VICE PRESIDENT HATCHER: Anyone else want to respond to this? Anything in reply?

PN5808

MR MAXWELL: Just briefly, we strongly disagree with the interpretation of Ms Adler in regard to how overtime is calculated for weekly hire employees. We say it doesn't matter whether the employee is weekly hire or daily hire, that the ordinary hours per day are eight hours per day under this award.

PN5809

VICE PRESIDENT HATCHER: All right. Are we up to annual leave and leave loading?

PN5810

MR CRAWFORD: Sorry, your Honour ‑ ‑ ‑

PN5811

VICE PRESIDENT HATCHER: Mr Crawford?

PN5812

MR CRAWFORD: It's a bit painful, but I think there are a couple of issues that the Bench will have to look at in terms of clarifying the current award. I'm referring in particular to the underground work provision, because the current wording doesn't make sense.

PN5813

VICE PRESIDENT HATCHER: Sorry, is this your application?

PN5814

MR CRAWFORD: The MBA have raised it. We've accepted it's an error. I think we perhaps have differing views about how the error should be rectified. I don't know if Mr Schmitke wants to ‑ ‑ ‑

PN5815

VICE PRESIDENT HATCHER: Which clause?

PN5816

MR CRAWFORD: Sorry, 33.1(e) ‑ ‑ ‑

PN5817

VICE PRESIDENT HATCHER: (e)(i) - what is it?

PN5818

MR CRAWFORD: (e)(iii). There's also an issue with the subclause above, (d), working compressed air.

PN5819

MR SCHMITKE: Your Honours and Commissioners, if I might just take to my feet at this point. This is in fact a matter that we raised in our applications dealt with in our submission, 16 December submission, at page 21, and it refers to the particular - this is in relation to the working compressed air which is at clause 33.1(d). Essentially the basis for our concern about this particular clause is work or safety related, however there is another aspect to this particular matter that I'd seek to draw the Commission's attention to.

PN5820

The existing provision states that:

PN5821

The working hours and conditions of employees working in compressed air will be those prescribed from time to time in the Standards Association of Australia for Working Compressed Air, Part 1, Air Lock Operations.

PN5822

So there's a number of concerns we hold about that particular provision. First we say that once again this is a provision which either does or purports to deal with what is essentially a work health and safety matter. There is no need for this particular provision to reference a document that would otherwise apply. The fact that it does now and the fact that it's out of date is evidence, we would say, of the ongoing problems the award will inherently face when we continue to have this type of specific detail within it. The standard applies irrespective of whether it's referenced right or wrong.

PN5823

DEPUTY PRESIDENT HAMILTON: We've already discussed that.

PN5824

MR SCHMITKE: Yes.

PN5825

DEPUTY PRESIDENT HAMILTON: I don't think you need to repeat ‑ ‑ ‑

PN5826

MR SCHMITKE: So to that end it is the second matter I'd like to draw your attention to, and that is that the standard itself of which we have an updated copy - so it's not just necessarily the case of replacing or updating the provision to achieve currency, it's a matter of the way in which the employer goes about obtaining the standard. The unions have pointed out and it is part of our contention but it's not the actual bona fide contention that you have to pay to get a copy of the standard. I've got a copy. It's $167 and it's all about work - essentially the hyperbaric chambers, as a result of being down, doing underground work under compressed air pressure.

PN5827

This particular standard doesn't set hours of work in terms of things like, "Finish at this time, start at that time." It doesn't talk about penalty rates, it doesn't talk about conditions of employment. It's about conditions under which a worker - the physical conditions that they're required to have provided to them while they're undertaking work in compressed air. So it's not hours and conditions as it might normally be in the context of an industrial award, it's the number of hours that they can perform this specialised type of work and the physical conditions within which it's performed.

PN5828

What we would say is that that creates confusion in this particular instance more than any other. Having a clause that refers to the working hours and conditions of employees working in compressed air in an industrial instrument which refers to the working hours and conditions of employment is a source of confusion. So I suppose with that in mind, anyone looking at this particular instrument would think, "Hang on, that particular clause sets the hours and conditions for people working in compressed air," and what do they have to do? They have to go and buy a copy of an Australian Standard for about $167.

PN5829

It's illegal. It's makes very clear when you order it that you can only order a hard copy, not an electronic copy. It costs you more and it limits you to the number of licences for which you can print this particular standard out. So you can print it two or three times and then you can't print it any further. There's requirements about posting a copy of the award in the workplace and so on and so forth.

PN5830

This raises a real problem, but aside from that and our third contention; this is the major point I would seek that the Commission have regard to, even if it does standardise or update this particular provision we would seek that the Commission have regard to this following matter, and that is we say it's unconscionable that we have an industrial instrument that requires anyone, doesn't matter if it's an employer or an employee, someone who wants to find out what the conditions of their employment are, or at least they think they have to look at this document to find out the conditions of their employment ‑ ‑ ‑

PN5831

DEPUTY PRESIDENT HAMILTON: Isn't it the case that that Code applies regardless of the award?

PN5832

MR SCHMITKE: That is the case. That is the case.

PN5833

DEPUTY PRESIDENT HAMILTON: Through licensing systems and so on. So that's presumably relevant.

PN5834

VICE PRESIDENT HATCHER: Won't they have to get it anyway?

PN5835

MR SCHMITKE: They do, but the point is it's referenced within an instrument, and the problem is that if you don't provide it you're up for a penalty. So it would exist, but if you don't make it available to employees in the workplace, if it's not posted, et cetera, et cetera, then there's a potential penalty provision there. That's actually not necessarily the major issue. The major issue is it's unfair, essentially, not only to Master Builders' members but to Mr Crawford's members, to Mr Maxwell's members, whoever would be doing this type of work, that they essentially have to buy a copy of a standard. If it was made available by virtue of the fact it's referenced in an instrument at no cost ‑ ‑ ‑

PN5836

DEPUTY PRESIDENT HAMILTON: You've made that point about five times, I think.

PN5837

MR SCHMITKE: Yes.

PN5838

DEPUTY PRESIDENT HAMILTON: Which is a good point, but you've made it many times.

PN5839

MR SCHMITKE: It is something about which we feel very strongly.

PN5840

DEPUTY PRESIDENT HAMILTON: We heard it the first time.

PN5841

MR SCHMITKE: Yes, and to that end we would seek that the clause be deleted. Notwithstanding that, I'm certain that there may well be alternatives put.

PN5842

VICE PRESIDENT HATCHER: And the underground work clause?

PN5843

MR SCHMITKE: I might hand to my colleague briefly.

PN5844

VICE PRESIDENT HATCHER: Yes.

PN5845

MS SOSTARKO: Thank you, your Honour. This claim is outlined in paragraph 6 of our submissions dated 16 December and it was also highlighted in evidence given by Mr Peter Glover in his statement at paragraphs 35 to 37 marked exhibit 38. Just briefly, in our submissions we pointed out that there was no apparent authority for the prescribed 30‑hour week for underground workers and that as a result it's our conclusion that that provision has been drafted in error with regard to that.

PN5846

This proposition was supported in our submissions where we highlighted that the preceding clause at 33.1(e)(ii) states that the hours of work for underground work will be 38 per week in accordance with the provisions of clauses 33.1(a)(1) and 33.1(a)(ii). I think it's also pertinent to raise the point that the pre modern award instrument, the NBCIA, didn't contain any such clause or providing for shorter working hours for these types of workers.

PN5847

VICE PRESIDENT HATCHER: So where did this come from?

PN5848

MS SOSTARKO: This is the question, which is why we have reached the conclusion through our investigations that it can only have been drafted in error.

PN5849

VICE PRESIDENT HATCHER: But did the test of (iii) come from some previous document? Leaving aside the 30, 38 question, did that paragraph come from some previous document?

PN5850

MR CRAWFORD: I can assist. It did. Do you want me to explain how or ‑ ‑ ‑

PN5851

VICE PRESIDENT HATCHER: Just tell me what the - what's the document?

PN5852

MR CRAWFORD: It's an old ACT federal award.

PN5853

VICE PRESIDENT HATCHER: And did it say 30 or 38?

PN5854

MR CRAWFORD: No, there's reference to the 30 hours. You can see that it's clearly the provision.

PN5855

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

PN5856

MS SOSTARKO: The instrument that Mr Crawford's referring to is, as he mentioned, an ACT award. It's a discrete provision that does not appear in any other award that we are aware of. There's no rational reasoning for that provision to have been included, or historical context for inclusion of that provision, so whether that was the case, I would suggest that that isn't enough reason to suggest that that would be the reasoning behind the inclusion of these working hours.

PN5857

VICE PRESIDENT HATCHER: So in (iii) it's got three exceptions. What are the week's working hours for the three exceptions?

PN5858

DEPUTY PRESIDENT GOSTENCNIK: Presumably they would be 38.

PN5859

MS SOSTARKO: Sorry, your Honour, what was the question?

PN5860

VICE PRESIDENT HATCHER: Well, (iii) says, "A week's work will be 30 hours per week exclusive of crib time except in the following cases," and it gives three cases. So if it's changed to 38 what's the working hours for those three exceptions?

PN5861

DEPUTY PRESIDENT HAMILTON: Is it 38?

PN5862

MS SOSTARKO: I think the thing is, your Honour, that the contention here is that the general provision of hours is 30, whereas there's - I have to say, I don't have the answer as to why those three classifications of work are the exception, but I ‑ ‑ ‑

PN5863

VICE PRESIDENT HATCHER: But you just want to change 30 to 38, so let's assume we change it to 38. I'm just wondering what the effect of that is on the three exceptions. What are their working hours? That is, the effect of the varied clause would be that they don't work 38 hours, they work some other figure and it's a mystery to me what it would be.

PN5864

MS SOSTARKO: I would have to take that question on notice, but I would suggest that that would mean that there would no longer be an exclusion.

PN5865

VICE PRESIDENT HATCHER: Therefore the whole subclause serves no purpose.

PN5866

MS SOSTARKO: That's correct, your Honour.

PN5867

VICE PRESIDENT HATCHER: That is, if you say one works 38, the whole subclause should go. Is that right?

PN5868

MR CRAWFORD: We'd accept that.

PN5869

VICE PRESIDENT HATCHER: You accept that. Well, that's easy.

PN5870

MR CRAWFORD: If it's going to be changed to 38 it serves no purpose, yes. We're not accepting the claim entirely.

PN5871

VICE PRESIDENT HATCHER: Have you finished, Ms Sostarko?

PN5872

MS SOSTARKO: Sorry, your Honour. Sorry, with reference to your previous question, subclause (iii), I would suggest, is with reference to the crib time component of that clause, so the exception being that those ‑ ‑ ‑

PN5873

VICE PRESIDENT HATCHER: So those three examples are inclusive of crib time.

PN5874

MS SOSTARKO: That's right.

PN5875

VICE PRESIDENT HATCHER: I see.

PN5876

MS SOSTARKO: Apologies for the delay in that response.

PN5877

VICE PRESIDENT HATCHER: All right, thank you. Mr Crawford, so this is mainly about tunnelling work, is it?

PN5878

MR CRAWFORD: Yes, your Honour. So like I said, we agree there is an error in the award, but we think the intent of the provision is to prescribe lower working hours for the three categories of work because they're more onerous. You know, it's working narrow tunnels. In the first dot point, it's ‑ ‑ ‑

PN5879

VICE PRESIDENT HATCHER: No, they're the exceptions.

PN5880

MR CRAWFORD: Yes, that's the error. They're not to be the exception.

PN5881

DEPUTY PRESIDENT HAMILTON: It should be 38 except those three which are 30 or something.

PN5882

MR CRAWFORD: Yes.

PN5883

DEPUTY PRESIDENT HAMILTON: Is that what you're saying?

PN5884

MR CRAWFORD: Yes, correct. Absolutely. That's what we say?

PN5885

DEPUTY PRESIDENT HAMILTON: Is that what the ACT award says?

PN5886

MR CRAWFORD: Not in perfect terms, but we would say yes. I believe your associate, your Honour, has a copy of the clause in the ACT award, if it would assist. It's clause 21 of the Australian Workers' Union Construction‑on‑Site and Civil Engineering (A.C.T.) Award 1999. It's clause 21.1.2(a).

PN5887

VICE PRESIDENT HATCHER: So how did the ACT tail ending up wagging the dog?

PN5888

MR CRAWFORD: Sorry?

PN5889

VICE PRESIDENT HATCHER: How did the ACT clause end up being the governing clause?

PN5890

MR CRAWFORD: I don't know. I mean, the fact that there's a little (a) and it's not a standalone clause I think is indicative that it's meant to be a provision that operates in addition to the general provision in clause 21.7.2. So 21.7.2 is prescribing underground work hours at 38 and then 21.7.2(a) is ‑ ‑ ‑

PN5891

VICE PRESIDENT HATCHER: Is this about their hours of work or the hours they spend underground?

PN5892

MR CRAWFORD: No, I think it's the hours of work.

PN5893

VICE PRESIDENT HATCHER: Does anyone actually work these 30 hours?

PN5894

MR CRAWFORD: To be frank, most enterprise agreements that I found for the AWU are based on a 36‑hour week.

PN5895

VICE PRESIDENT HATCHER: A 36‑hour week. So that would fail the BOOT.

PN5896

MR CRAWFORD: I don't think it's as simple as that. I mean, if the hourly rates are, you know, $30 per hour ahead of the award, which they often would be, you could still ‑ ‑ ‑

PN5897

VICE PRESIDENT HATCHER: So how many hours?

PN5898

DEPUTY PRESIDENT GOSTENCNIK: So consistent with the ACT award draft the actual provision should have read, "In the following cases a week's work will be 30 hours, exclusive of crib time."

PN5899

MR CRAWFORD: Yes. The variation we propose in our reply submission was that the preamble in (iii) should read, "A week's work will be 30 hours per week, exclusive of crib time in the following cases."

PN5900

VICE PRESIDENT HATCHER: "In the following cases," yes.

PN5901

DEPUTY PRESIDENT HAMILTON: Why was an ACT clause adopted nationwide? I assume there's no explanation in the award simplification decisions.

PN5902

MR CRAWFORD: No. I think ‑ ‑ ‑

PN5903

DEPUTY PRESIDENT HAMILTON: It just happened.

PN5904

MR CRAWFORD: ‑ ‑ ‑ someone sort of cherry-picked - picked it up, went in the exposure draft. Big process. Commission put it in ‑ ‑ ‑

PN5905

DEPUTY PRESIDENT HAMILTON: So it was a sort of drafting issue, yes.

PN5906

MR CRAWFORD: Yes.

PN5907

DEPUTY PRESIDENT HAMILTON: Okay, thank you.

PN5908

MR CRAWFORD: I mean, there's certainly not any detailed consideration of the clause anywhere, as far as I can see.

PN5909

VICE PRESIDENT HATCHER: All right. Is that issue done, Ms Sostarko?

PN5910

MR CRAWFORD: Sorry, your Honour, I was going to reply on the compressed air.

PN5911

VICE PRESIDENT HATCHER: Yes.

PN5912

MR CRAWFORD: So the issue is the current award - I mean, in safety regulations workers working in compressed air need to take additional breaks.

PN5913

VICE PRESIDENT HATCHER: But just to be clear, this is not about their working hours, this is the hours they spend working in compressed air.

PN5914

MR CRAWFORD: Yes.

PN5915

VICE PRESIDENT HATCHER: They still work a 38‑hour week, don't they?

PN5916

MR CRAWFORD: They can, but they have to observe additional breaks. So if they're working in ‑ ‑ ‑

PN5917

VICE PRESIDENT HATCHER: They don't turn up for work and walk straight into compressed air.

PN5918

MR CRAWFORD: No, they wouldn't spend all their weekly hours probably working in compressed air, but ‑ ‑ ‑

PN5919

VICE PRESIDENT HATCHER: So if this is not, properly speaking, an hours of work clause, it's a clause to deal with the safe hours to work in compressed air.

PN5920

MR CRAWFORD: I guess you could categorise it that way, but I think the main - from reviewing the standard, the main industrial sort of condition in there was the requirement to take breaks. There's a limit on how long you can work and then you need to have a specified break outside of those conditions. The point is arguably the award as it stands at the moment, with the breaks that are prescribed, would be inconsistent with the safety requirements in relation to working in compressed air so we think there is some merit in alerting users to that issue. We accept it's not ideal to refer to a specific document because they can be superseded, but there are some alternative words that I'd like to put forward. I'd be interested to hear the views of the other parties.

PN5921

The employment conditions and associated entitlements set by this award shall apply. Limitations on time spent working in compressed air and the physical conditions under which such work is performed shall be subject to the applicable Australian Standard.

PN5922

VICE PRESIDENT HATCHER: Mr Crawford, that's useful, but can I ask you to file that as a proposed variation?

PN5923

MR CRAWFORD: Yes.

PN5924

VICE PRESIDENT HATCHER: Then I'll let the parties file a written response to that rather than trying to deal with it on the run. Mr Maxwell?

PN5925

MR MAXWELL: Your Honour, just very briefly, just in regard to the issue of the people working underground, I should advise the Bench that we do deal with that matter in paragraphs 39 to 43 of our written submission and we just outline the history of the provision into the award.

PN5926

VICE PRESIDENT HATCHER: All right. Anything in reply? Annual leave loading.

PN5927

MS ADLER: Yes, thank you, your Honour. So this is dealt with in our written submissions at part 9. Very briefly, the proposed variation which is at attachment P to our submission seeks to remove the fares and travel patterns allowance from the calculation of annual leave loading under clause 38.2(b) of the award.

PN5928

We say that the current inclusion of that allowance within that calculation is confusing given clause 25.10 of the award which basically says that, firstly, the fares and travel patterns allowance is not payable for all purposes, and secondly, that the amount of the fares and travel patterns allowance isn't to be included in the amount payable as part of the wages to be paid to an employee while on annual leave. So you don't get the fares and travel while you're on annual leave but you do get it as part of the annual leave calculation which requires an employer to do two separate calculations for an employee taking annual leave. That's my submission on that unless there's any questions.

PN5929

VICE PRESIDENT HATCHER: No, thank you.

PN5930

MS ADLER: Thank you.

PN5931

VICE PRESIDENT HATCHER: There's also an MBA variation about this, Ms Sostarko.

PN5932

MS SOSTARKO: Yes, thank you, your Honour. We've made submissions with regard to this claim with regard to clause 38.1 at paragraph 22 of our submission dated 2 December. This claim is a simple clarification proposal and it's our submission that it would assist award users to calculate entitlements, including those pertaining to annual leave under the award.

PN5933

The amendment that we propose doesn't have any effect on entitlements already provided for under the NES but instead it simply reinstates the reference to the definition of continuous service for the purposes of a redundancy and annual leave which previously existed within the definitions under clause 4.15 of the NBCIA and clause 32, and obviously pointing to the definition which is consistent within the Act under clause 22 with regard to continuous service. Thank you, your Honour.

PN5934

VICE PRESIDENT HATCHER: Thank you. Mr Maxwell?

PN5935

MR MAXWELL: Thank you, your Honour. If I can briefly deal with the MBA variation. We deal with that in paragraph 251 of our written submission and we say that we don't believe the variation is necessary, but otherwise we make no further submissions on the issue.

PN5936

VICE PRESIDENT HATCHER: Do you want to say anything, Mr Crawford?

PN5937

MR CRAWFORD: No, your Honour.

PN5938

VICE PRESIDENT HATCHER: All right.

PN5939

MR MAXWELL: If I can then deal with the issue of annual leave loading, we deal with that issue in paragraphs 252 through to 254 of our written submission in reply. We say it's a reduction in the safety net. If you look at paragraph 252, we've calculated that the value to an employee of removing the loading applied to the fares and travel is an amount of $15.25 per week based on the current fares and travel allowance and by a greater amount for those employees who are covered by enterprise agreements that incorporates that aspect of the award clause.

PN5940

In regard to the evidence as supplied by the MBA to support this variation, the only evidence they refer to is the witness statement of Ms Marantz and the information on IFAs in Annexure A to that statement and we point out that only 24 of 43 IFAs that the HIA refer to actually deal with annual leave loading. We submit therefore there is insufficient evidence to warrant a variation.

PN5941

Significantly to the Full Bench, in paragraph 253 of our written submission we note that a similar application was made by the HIA during the 2012 award review and the majority of the Full Bench rejected the HIA application and they made the reason why the loading is calculating on fares and travel fairly clear in paragraph 114, where they say:

PN5942

We vary clause 38.2(b) of the modern award by deleting the phrase "rates loading allowances prescribed by" and replacing it with the "following the rates, loading and allowances if such rates, loadings and allowances would have been received by the employee for working ordinary time hours had the employee not been on annual leave".

PN5943

They went on to say that weren't persuaded that the award was not achieving the modern awards objective and they declined the HIA variation. If the Commission pleases.

PN5944

VICE PRESIDENT HATCHER: Thank you. Anything in reply? No. Before we move on, I'm going to mark the extract tendered by Mr Crawford of the Australian Workers' Union Construction-on-Site and Civil Engineering (A.C.T.) Award 1999 as exhibit 47.

EXHIBIT #47 EXTRACT OF AUSTRALIAN WORKERS' UNION CONSTRUCTION-ON-SITE AND CIVIL ENGINEERING (A.C.T.) AWARD 1999 TENDERED BY MR CRAWFORD

PN5945

VICE PRESIDENT HATCHER: Mr Schmitke, the extract you handed up, what was that from again?

PN5946

MR SCHMITKE: That was the National Building and Construction Industry Award 2010 - 2000, sorry.

PN5947

VICE PRESIDENT HATCHER: I'll mark the extract tendered by Mr Schmitke from the National Building and Construction Industry Award 2000 as exhibit 48.

EXHIBIT #48 EXTRACT FROM NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 TENDERED BY MR SCHMITKE

PN5948

MR SCHMITKE: Thank you, your Honour.

PN5949

VICE PRESIDENT HATCHER: Mr Crawford, you're next?

PN5950

MR CRAWFORD: Yes, your Honour. Can I please take the Bench to the issue in the current award we're trying to address. It's clause 4.10(b)(v). That clause clearly includes within the definition of civil construction the testing of soil, concrete and aggregate when it is carried out at a construction site in or in connection with word under clause 4.10(b)(i), and the effect of that cross‑reference is basically it's in connection with civil construction work.

PN5951

So we think that part of the coverage clause demonstrates a clear intention to include within this award the testing of soil, concrete and aggregate when it is carried out at a construction site when civil construction work is being done.

PN5952

VICE PRESIDENT HATCHER: But that would be subject to the exclusion of 4.2(a), wouldn't it?

PN5953

MR CRAWFORD: Yes. I'll get to that, your Honour. I just would note that the inclusion of that coverage was in the AWU's draft civil construction award as part of the award modernisation process. It was also in the draft award submitted by the Australian Industry Group. It was included in the initial exposure draft made by the award modernisation Full Bench and it obviously ended up in the final award and no issue about that coverage was ever raised.

PN5954

The issue we're trying to address is the lack of reference in the classification structure of the award to that testing work. Obviously that has arisen as a practical issue in the Coffey(?)(10.09.08) litigation, which I'll come to, but I first want to make the point that the way this award works in relation to the civil construction sector in the definition in clause 4.10(b) generally is that the specific types of civil construction work are referenced in the coverage clause and then there is specific reference in the classification structure to associated types of work.

PN5955

So for example, there's reference to traffic control work at CW2 level, there's reference to concrete batching work at the CW2 level as well. As I alluded to yesterday, there's reference to bitumen work associated with road making at the CW1, 3 and 4 levels. There's reference to geotextile, geomembrane work at the CW1 to CW5 level. There's reference to landscaping work at the CW1, 2, 3 and 4 levels and there's reference to cooking and cleaning work, being the work of a cook and a mess attendant, in the CW1 classification and I think CW3 for a cook.

PN5956

So the point I'm making is the way this award works is the references to parts of the civil construction definition are in the coverage clause and in all other cases there's specific reference in the classification structure to the work in that classification. There isn't in relation to the testing of soil, concrete and aggregate. We think that was an oversight and that's the issue we're trying to address in this case.

PN5957

VICE PRESIDENT HATCHER: So why CW2?

PN5958

MR CRAWFORD: Yes, I was going to come to that, your Honour.

PN5959

VICE PRESIDENT HATCHER: Right.

PN5960

MR CRAWFORD: I just wanted to quickly take the Bench through the material that the AWU is relying upon for its claim. There was a written submission that has the draft determination attached. Unfortunately I can't find a date on my version, but does the Bench have it?

PN5961

MS ADLER: 2 December.

PN5962

MR CRAWFORD: Thank you. 2 December 2016. That's a relatively detailed submission. It goes through the award history. It addresses the modern awards objectives. Attached to that submission is document AW1, which is a document produced by the National Association of Testing Authorities. It talks about accreditation to perform testing work. In Appendix D there is specific reference to requirements for businesses who do testing on remote sites such as construction sites. So that is further evidence for the Bench about the type of work that we're talking about here.

PN5963

Attachment AW2 is the old pre‑modern ECLA/AWU Soil, Concrete Testing and Analysis Award 2000. In response to your question about CW2, your Honour, the ECLA Award is our primary reference point, and I should note that when the ECLA Award was made in 2000 there was a requirement on the Commission to apply relativities when making new awards.

PN5964

So the rates in the ECLA Award were determined - there is reference in the approval decision to the relevant Commission member being satisfied about, I think, principle 11 out of the 2000 safety net review decision. So it was a requirement on the Commission when making awards at this time to apply relativity principles, so when the ECLA Award was made it would have been made reference to relativities in other awards and the lining of the work covered by this award with that work.

PN5965

Now if I turn to clause 16.2 of the ECLA Award, that has the wage rates in it, and the adult trainee first year rate of $557.50 which was paid to a mature starter, no experience labourer, essentially, that particular rate is almost identical to the CW2 rate that applied in the construction awards at the relevant time. So the CFMEU - I don't know the full name, but the national building award, also the AWU Civil Construction Award, both of those awards have the same CW2 rate, because relativity principles would have been applied, and the adult trainee rate was basically almost identical to that CW2 rate.

PN5966

You can see from the classification structure in the ECLA Award that there were actually higher classification so we consider the CW2 claim to be a modest claim, because based on the ECLA Award the CW2 equivalent rate was basically the lowest rate for an adult employee in that award. So that's basically where we get the CW2 classification from, in addition to the document I already took the Bench to in relation to the type of testing work performed and also the evidence of the AWU witnesses.

PN5967

The attachment AW3 to those submissions is basically an updated version of the rates in the ECLA Award so I've applied all the national wage case increases since the award was effectively frozen in 2005, and that just provides further proof that the adult trainee rate is closely aligned to the CW2 rate and just, I think, provides further evidence that this is a modest claim from the AWU.

PN5968

I should probably now turn to the Coffey decision, which I think the Bench already has. So at paragraph 12 of the Coffey Full Bench decision the Full Bench cited clause 4.2(a) of the Manufacturing Award, and the effect of that clause in the Manufacturing Award is basically that in the Manufacturing Award there is industry and occupational coverage. For an employer that only falls within the occupational coverage of the Manufacturing Award there is an exclusion stated in the Manufacturing Award:

PN5969

If there is another modern award containing a classification which is more appropriate to the work performed by the employee.

PN5970

So the problem we had in the Coffey proceedings was because there is no specific mention of testing work in the classification structure of the On-site Award, the occupational coverage in the Manufacturing Award basically prevailed based on an application of clause 4.2(a).

PN5971

We say the result would be different if there was clear mention to soil and concrete testing work at the CW2 level, because if that is inserted we would say there would clearly be another modern award containing a classification which is more appropriate to the work performed by the employee.

PN5972

The work we're talking about, based on the evidence of Mr Muller, his evidence was basically that he travels around from construction site to construction site doing testing work. He's working outdoors. He has to start work on the job site at all various locations so he's experienced the disabilities associated with construction work. You saw his uniform in the witness box. He's wearing high-vis clothing. He looks like any other construction worker. He's exposed to the elements, he's exposed to the elements, he's exposed to dust, et cetera.

PN5973

So we say if there was clear reference in the classification structure to the On-site Award to soil and concreting testing that the outcome in the Coffey proceeding would have been different, and we think ‑ ‑ ‑

PN5974

VICE PRESIDENT HATCHER: I don't know about that, because how does 4.2(a) of the Manufacturing Award have operation where the on-site construction award has a straight‑out exclusion of anything covered by the Manufacturing Award?

PN5975

MR CRAWFORD: Then it almost becomes circular, but then you have to work out if it's covered by the Manufacturing Award or not.

PN5976

VICE PRESIDENT HATCHER: It's not clear to me that - whether we should change the result or not is another question. It's not clear to me that your variation actually would change the result.

PN5977

MR CRAWFORD: I think you have to start off with the coverage of the Manufacturing Award, and as I said, there's industry coverage. It was never claimed that Coffey, the relevant company, fell within that industry coverage. The only suggestion was that their workers fell within the occupational coverage, but to be covered by the Manufacturing Award - sorry, there is an exclusion from coverage in the Manufacturing Award in clause 4.2(a).

PN5978

So if you apply clause 4.2(a), which requires you to have a look whether there's a more appropriate classification in another award, if you apply that and find that there is another award, the Manufacturing Award doesn't cover the employee. So the exclusion in the On-site Award isn't relevant because the Manufacturing Award doesn't apply.

PN5979

VICE PRESIDENT HATCHER: All right.

PN5980

MR CRAWFORD: I accept it's not entirely clear, but it's difficult with these award interactions to always find an entirely clear solution. We are satisfied that if the amendment we're proposing is made that the issue would be clear and the intent of the On-site Award would be given effect, which is testing work performed on civil construction sites is covered by the On-site Award.

PN5981

Obviously for a business like Coffey that doesn't mean the whole business is covered by the On-site Award. It would only ever apply to work performed on construction sites. So we're only talking about employees like Mr Muller who basically spend - I mean, I think his evidence was he spends essentially 100 per cent of his time either on construction sites or travelling to the next construction site.

PN5982

So it's only that small group of employees that we're trying to deal with here. The AWU has always thought they are construction workers. The AWU has always thought the On-site Award was meant to cover those workers. That's why there is specific reference to testing work on civil construction sites in the coverage clause of the On-site Award. There is no reason why the coverage - there should be reference in the coverage clause to that testing work and then there should not be reference to that work in the classification structure.

PN5983

As I alluded to before, that's how the award works. For the other categories of civil construction work there is a specific reference in the classification structure as well, and that's what there should be for soil and concrete testing work. We just think it was an oversight as part of the award modernisation process that it wasn't included.

PN5984

VICE PRESIDENT HATCHER: You've made your point.

PN5985

MR CRAWFORD: Thank you.

PN5986

VICE PRESIDENT HATCHER: Is there anything further about this, Mr Crawford?

PN5987

MR CRAWFORD: I just wanted to take the Bench to paragraph 28 of the Coffey Full Bench decision, because I think it is relevant that the Full Bench in that case did actually conclude in the second part of paragraph 28:

PN5988

Notwithstanding its primary activity at base laboratories we tend to the view that a part of its business can be described as testing at a construction site or testing in connection with construction work. However, the On-site Award does not cover the technicians in any event because of the interaction provisions of the award.

PN5989

So the Full Bench was saying that they are satisfied that the part of Coffey's business that involves testing on construction sites is part of the civil construction industry, but by applying clause 4.2(a) of the Manufacturing Award they concluded that the Manufacturing Award was the more appropriate award in that case. I just wanted to note the other material relied upon by the AWU are three witness statements from Mr Buhler, Mr Callinan and Mr Muller.

PN5990

DEPUTY PRESIDENT HAMILTON: Which you've referred to at length.

PN5991

MR CRAWFORD: Yes. That was it, thank you.

PN5992

VICE PRESIDENT HATCHER: Ms Hogg?

PN5993

MS HOGG: Thank you.

PN5994

MR NGUYEN: Sorry, your Honour, it's Mr Nguyen in Sydney.

PN5995

VICE PRESIDENT HATCHER: Yes?

PN5996

MR NGUYEN: If I can make some brief submissions on this point. We support the ‑ ‑ ‑

PN5997

VICE PRESIDENT HATCHER: Do you support the variation?

PN5998

MR NGUYEN: Yes, we do support the variation.

PN5999

VICE PRESIDENT HATCHER: All right. We'll hear Mr Nguyen first.

PN6000

MR NGUYEN: Your Honour, we support in principle the AWU's proposal about these category of workers, in particular that soil testers are included in the On-site Award, however we propose that the classification structure of the On-site Award should be amended in relation to the technical field so that it is in alignment with the technical field in the Manufacturing Award.

PN6001

Currently in the Manufacturing Award the technical field does extend to the equivalent level which Mr Crawford is seeking, which is CW2. In the Manufacturing Award that is C11. The technical field in the Manufacturing Award does extend to C11 currently whereas the On-site Award doesn't extend to C11. So we would propose that there is a new technical field classification which is put in at the CW2 level and we have provided a draft determination to give effect to that.

PN6002

However, I just put strongly that we do strongly support the AWU's submission that there's a strong merit argument for providing these workers who experience on‑site workplace conditions to be included in the coverage of the On-site Award. Whatever the method that is decided by the Commission to implement outcome we would in principle generally support that outcome of these workers being included in the On-site Award. Thank you, your Honour.

PN6003

VICE PRESIDENT HATCHER: Thank you, Mr Nguyen.

PN6004

MR CRAWFORD: Sorry, your Honour, there is one very brief point. I'm sorry, but I think it's important that we say the work value factors in the Act don't apply to this claim, because the Commission would be setting the rate for the relevant work, not varying it, and the Act makes it quite clear that the work value provisions are activated only if the Commission is varying the minimum rates in an award. We have mentioned that in our submissions at paragraph 78 onwards.

PN6005

VICE PRESIDENT HATCHER: If the minimum rate is set in one award and we're moving them to another award and you set a high minimum rate does the provision apply?

PN6006

MR CRAWFORD: We say that that's not how it works, your Honour. It's talking about variations to the minimum rates in an award.

PN6007

VICE PRESIDENT HATCHER: All right, thank you. Ms Hogg?

PN6008

MS HOGG: Thank you, your Honour. At the outset I'd just like to note that ABI has previously filed reply submissions which is on 20 March in respect of the AWU's claim, and in particular we repeat and rely upon section 2 of those submissions and also paragraphs 3.8 to 3.11 of the submissions.

PN6009

VICE PRESIDENT HATCHER: Ms Hogg, can I just clarify, obviously you're representing an industry organisation, but does your organisation specifically represent Coffey as well?

PN6010

MS HOGG: We have not had instructions from Coffey in relation to this matter, no.

PN6011

VICE PRESIDENT HATCHER: All right, thank you.

PN6012

MS HOGG: In this claim the AWU is seeking to amend schedule B of the On-site Award which sets out the classifications for employees which are covered by the award. In particular, the AWU seeks the insertion of a tester provision in the classifications which refers to soil, concrete and aggregate testing, and that's for a CW level 2. As the AWU is the applicant in the proceedings the onus is on them to satisfy the Commission of the need for this change and we respectfully submit that the evidence presented before the Commission and relied upon by the AWU does not establish a basis for the changes sought or ‑ ‑ ‑

PN6013

VICE PRESIDENT HATCHER: If the on‑site construction award covers concrete testing to some degree doesn't it follow that it needs a classification to support that coverage?

PN6014

MS HOGG: The classifications on the On-site Award are quite broad in nature.

PN6015

VICE PRESIDENT HATCHER: Yes.

PN6016

MS HOGG: As such, if there are people who fall - if there are employers who fall within the scope of that award and fall within that industry, then potentially those classifications are broad enough such that employees will fall within them.

PN6017

VICE PRESIDENT HATCHER: So what classifications would currently cover concrete testing on site where this award applies?

PN6018

MS HOGG: Just a moment, your Honour. Your Honour, I suppose at this stage I couldn't give you a specific classification, however I do note that within the classifications there are some quite broad requirements in terms of the extent of skills that are going to be exercised by a person within that classification. So I think it would be probably relevant for the employer to determine the skills being exercised by the person doing that particular work.

PN6019

VICE PRESIDENT HATCHER: Did the Coffey decision identify any classifications as being applicable?

PN6020

MS HOGG: As being relevant under the On-site Award?

PN6021

VICE PRESIDENT HATCHER: Yes.

PN6022

MS HOGG: No. In the Coffey decision the reason that there was no classifications identified, as I recall the decision, both at first instance and on appeal, is that the employer Coffey was not found to be an employer within the industry of the award. So if you look at the Coffey decision at first instance, Commissioner Cargill - it was made very clear that the issue is whether or not Coffey is an employer in the on‑site building, engineering and civil construction industry. In order to answer this question it's necessary to consider the evidence, and Commissioner Cargill at paragraphs 83 and 86 concluded that:

PN6023

A consideration of the evidence leads me to conclude that Coffey is not an employer in the on‑site building, engineering and construction industry and it follows that the On-site Award does not cover the company.

PN6024

Similarly, despite the representations made by my friend earlier, I'm of the view that the Full Bench has also affirmed that position in paragraphs 27 and 28 by saying:

PN6025

Whether Coffey is an employer in the building and construction industry depends on an analysis of the services it provides, the relationship between those services and the construction activity and the application of the definitions of the On-site Award. Given the specialist nature of its services and the significant proportion of those services provided at laboratory locations some distance from the construction activities we doubt that the employer's business can legitimately be described as construction of civil or mechanical engineering projects.

PN6026

PN6027

So in view of the findings of Commissioner Cargill and the Full Bench ‑ ‑ ‑

PN6028

VICE PRESIDENT HATCHER: But this issue is dealt with in paragraphs 23 to 25, isn't it?

PN6029

MS HOGG: Of the Full Bench decision?

PN6030

VICE PRESIDENT HATCHER: Yes, particularly 25.

PN6031

MS HOGG: Yes.

PN6032

VICE PRESIDENT HATCHER: So they're dealing with which award is more appropriate.

PN6033

MS HOGG: Yes.

PN6034

VICE PRESIDENT HATCHER: In 25 they compare the classifications. So they talk about the Manufacturing Award in 24 as having specific technical classifications.

PN6035

MS HOGG: Yes.

PN6036

VICE PRESIDENT HATCHER: In 25 they say, "Classification general. No specific mention of testing work," et cetera, et cetera.

PN6037

MS HOGG: Correct. There's no specific mention of testing work in the On-site Award, no, but at the end of the day, in order for - if you look at clause 4.2 of the Manufacturing Award it does say that there will be coverage - if there's no - sorry, where is it. An employer who is outside the scope of clause 4.9A and B - sorry:

PN6038

Employers is an employer covered by clause 4.9(c) and the employer is not covered by another modern award containing a classification which is more appropriate.

PN6039

So in this case Coffey was not covered by another award and hence the issue of the appropriate classification was to some degree not relevant, because the employer must fall within the industry in order to be covered by the award.

PN6040

In view of the findings in Coffey, we submit that insofar as the AWU claim concerns the Coffey employees - and Coffey seems to be the only business in the testing industry which has been raised by the AWU - that the insertion of testing work in CW2 classification will not necessarily bring these Coffey employees within the coverage of the On‑site Award, because in our submission an inquiry still must be made into the nature of the employer's business and such an inquiry will be relevant to determining whether there is coverage under the award.

PN6041

So even if there is a variation as proposed, our submission would be that potentially it's not going to create coverage for the Coffey employees and to displace the Coffey decision which the AWU is seeking to do.

PN6042

A couple of other points that I'd just like to briefly touch on is the submissions of the AWU which were filed on 2 December and just a number of assertions that were made in those particular submissions. In that particular submission the AWU has asserted that prior to the implementation of the modern awards the ECLA Award which was referred to in my friend's submissions earlier applied Australia wide.

PN6043

In making this statement it appears that the AWU is inviting the Commission to amend the alleged coverage issue in the On‑site Award based on the wide application of the ECLA award and the large number of people affected by the alleged coverage issues which has been raised by the AWU.

PN6044

We contend that this is not a submission which can be supported by the evidence filed in these proceedings. It's self‑evident from the ECLA award that coverage is limited to 13 named respondents in the back of one of the schedules of the ECLA Award and all of these named respondents are situated in the state of New South Wales. While the ECLA Award does apply to employees of the respondents when they're working in other states and territories, there is no coverage of employers who are not named respondents and who operate in other states and territories.

PN6045

As such, we submit that the ECLA Award, it's a standalone instrument which had limited operation prior to the commencement of the modern award, and further, the ECLA Award was not a common rule award for Victoria, ACT and the Northern Territory, as was a common feature for many pre‑reform federal awards.

PN6046

In the 2 December submissions the AWU also asserts that it appears the AIRC and the other parties involved in the award modernisation process intended to include the ECLA Award coverage in the coverage provisions of the On‑site Award. Notwithstanding this intention, according to the AWU the parties overlooked the inclusion of testing work in the classification structure for what we know as the On‑site Award.

PN6047

The AWU has presented no evidence to the Commission that during the award modernisation process for the making of the On‑site Award the parties and indeed the AIRC specifically contemplated the terms of the ECLA Award and the coverage of persons who were at that time covered by the ECLA Award. The witness statements of Mr Muller, of Mr Buhler and Mr Callinan do not address this issue and the only evidence which has been put forward before the Commission in support of this contention is the draft Civil and Construction Awards filed by the AiG and AWU back in 2008 which I note were referred to in paragraph 20 of the AWU's submission.

PN6048

According to the AWU, the intention of the parties is said to be evident by the AWU and the AiG referencing testing work in the coverage provision of the draft awards, but with respect, we'd submit that this evidence provides little or no insight into the intention of the parties in the award modernisation process, particularly in regards to whether the parties and the AIRC intended for employees to be - employees covered by the ECLA Award to be covered by the On‑site Award.

PN6049

Accordingly, we submit that there is insufficient evidence to conclude that the current classification structure in the On‑site Award is born out of some sort of mistake in the award modernisation process which resulted in the On‑site Award not reflecting the intention of the AIRC and indeed the parties that were involved in that award modernisation process.

PN6050

I've already touched on the Coffey case and I'd just like to turn to some of the evidence which has been presented by the AWU in these proceedings. The AWU has relied on the witness statements of Mr Muller, Mr Buhler and Mr Callinan. We submit that the evidence in these statements is objectionable on the basis of opinion and hearsay and therefore such evidence should be given little weight in determining the AWU claim.

PN6051

Also, the evidence presented is limited in its scope and cannot be said to demonstrate the position of all of the employees who work at Coffey or indeed the position of employees who work in the wider testing industry.

PN6052

In regards to Mr Muller's evidence, it's clear that the evidence he gives relates to his personal experiences as a tester rather than those of the entire workforce. Mr Muller relayed his opinions concerning the work performed at Coffey and he's provided no evidence at all concerning the wider testing industry. In particular, Mr Muller's evidence shows that he mostly worked alone, and that's referred to in paragraph 14 of his statement.

PN6053

VICE PRESIDENT HATCHER: Ms Hogg, that evidence generally demonstrated that at least for Coffey ‑ ‑ ‑

PN6054

MS HOGG: Yes.

PN6055

VICE PRESIDENT HATCHER: Or for Coffey, there are a number of concrete testers who primarily do their work on site at construction sites. There can't be any reasonable doubt about that proposition. What it means is another thing ‑ ‑ ‑

PN6056

MS HOGG: Yes.

PN6057

VICE PRESIDENT HATCHER: ‑ ‑ ‑ but it can't be reasonably doubted that's what that evidence demonstrates.

PN6058

MS HOGG: No, that's correct, your Honour, but Mr Muller's evidence also shows that he does spend a portion of his time off site, largely through driving, and he also advised the Commission during cross‑examination that time is spent at base labs, particularly at times such as when there's rain on site, et cetera. Mr Muller has relied on conversations with various unnamed employees at unnamed periods in support of some of the assertions in his witness statements and there hasn't been any independent evidence to support these assertions.

PN6059

At the end of the day, this evidence that the AWU seeks to rely upon in support of its claim comes from one employee of one business, and he's largely giving evidence about his own circumstances. On that basis we submit that the evidence of Mr Muller should be given little weight by the Commission when determining the AWU's claim. Furthermore, due to the limited nature of his evidence, we submit that it is insufficient to support a change to the On‑site Award as proposed by the AWU.

PN6060

In regards to Mr Callinan's evidence, it's noted that his experience with Coffey's employees is limited to dealing with members in the Newcastle area, and this is pointed out in paragraph 4 of his statement. Further, Mr Callinan's evidence is based on his observations from specific projects, which is obviously not representative of all projects by Coffey or indeed projects within the broader testing industry.

PN6061

Mr Callinan also relies on his discussions or consultations with members to support the assertions in his witness statement. Notwithstanding this, Mr Callinan has presented no evidence to the Commission of these alleged conversations and also no members of the AWU have been called to support these assertions.

PN6062

VICE PRESIDENT HATCHER: So we shouldn't believe him.

PN6063

MS HOGG: Well, on that basis we say that little weight should be placed on those assertions.

PN6064

VICE PRESIDENT HATCHER: Ms Hogg, are there employers in the civil construction industry that undertake soil testing, et cetera?

PN6065

MS HOGG: Are there other?

PN6066

VICE PRESIDENT HATCHER: Are there employers who undertake those functions?

PN6067

MS HOGG: My understanding is yes.

PN6068

DEPUTY PRESIDENT GOSTENCNIK: Within the civil construction industry.

PN6069

MS HOGG: Other employers?

PN6070

VICE PRESIDENT HATCHER: Yes.

PN6071

MS HOGG: Yes.

PN6072

DEPUTY PRESIDENT GOSTENCNIK: What are their employees to be classified as?

PN6073

MS HOGG: That would depend on the nature of their business.

PN6074

VICE PRESIDENT HATCHER: Yes, but if they're on the On‑site Award what classification covers them?

PN6075

MS HOGG: That's going to be dependent on the level of responsibility and duties which they're exercising.

PN6076

DEPUTY PRESIDENT HAMILTON: So there could be various classifications depending on those factors.

PN6077

MS HOGG: Potentially, yes. I now turn to Mr Buhler's statement which again contains a number of opinions that are not ‑ ‑ ‑

PN6078

VICE PRESIDENT HATCHER: I think I've given you the hint that this is not really assisting us. We've got evidence in relation to Coffey only, I accept, which seems to indicate that some of their testers spend most of their time on site. Does it really require much more analysis than that?

PN6079

MS HOGG: Okay. Thank you. I'll move on.

PN6080

VICE PRESIDENT HATCHER: Again, you might say it's got no significance or it's not representative, but just as an evidentiary point, it seems to me that's fairly clear.

PN6081

MS HOGG: Yes. Thank you, your Honour. Look, overall there appears to be - in our view, we submit there's a lack of evidence has been presented by the AWU in its case and this is inconsistent with the requirement that significant amendments to an award be justified on the merits and be supported by analysis of the relevant legislative provisions and probative evidence, and this requirement was recently confirmed in the penalty rates case at paragraph 269, reference (2017) FWCFB 1001.

PN6082

Further, this lack of probative evidence presented by the AWU means that the prima facie assumption that the On‑site Award achieved the modern awards objective at the time it was made has not been displaced. For this reason and the reasons which I've presented to you here today, we submit that the AWU's application should be dismissed. Thank you.

PN6083

VICE PRESIDENT HATCHER: Thank you. Any other employer submissions? Anything in reply, Mr Crawford?

PN6084

MR CRAWFORD: Just one quick point ‑ ‑ ‑

PN6085

VICE PRESIDENT HATCHER: Sorry, Ms Sostarko?

PN6086

MS SOSTARKO: Sorry. Thank you, your Honour. I was a bit slow in standing up. We also rely on submissions that we've made and I'll just briefly make just two more points with regard to the evidence that was brought by the AWU.

PN6087

In addition to the decision in Coffey where the Full Bench obviously determined that Coffey's employees involved in physical testing processes fell within the description of technical workers in the Manufacturing Award, if I could just refer the Bench to exhibit 42, being the statement of Mr Muller where he gave evidence by his own statement that he was a fulltime concrete technician for Coffey Testing, which was a new iteration of the company subject to the AWU's appeal.

PN6088

When questioned about his qualifications Mr Muller stated that he wasn't aware of any of his workmates having a certificate III or similar in laboratory skills. I just wanted to bring to the Bench's attention at paragraph 20 of the Coffey decision that the Commission held that C11 classifications within the Manufacturing Award clearly apply to laboratory testers who have completed certificate II in sampling, measurement or the equivalent, but in addition to that they went on to state at paragraph 21 that where employees hadn't completed such qualifications one of the lower classifications in C13 or C14 at schedule B of the Manufacturing Award would also apply.

PN6089

So we would also submit that the appeal decision makes it clear that workers such as Mr Muller would therefore be caught by either of these classifications regardless of his qualification and training, as stated in that decision.

PN6090

VICE PRESIDENT HATCHER: So since you've got involved in the debate I'll direct the question at you. If a concrete testing company is covered by the On‑site Award, leaving aside Coffey, what classifications cover their workers, if any?

PN6091

MS SOSTARKO: Currently under the schedule, none, I would suggest, your Honour.

PN6092

DEPUTY PRESIDENT GOSTENCNIK: In which case the award wouldn't apply.

PN6093

VICE PRESIDENT HATCHER: That is, to the extent that ‑ ‑ ‑

PN6094

MS SOSTARKO: The On‑site Award?

PN6095

VICE PRESIDENT HATCHER: Yes.

PN6096

MS SOSTARKO: That was the decision that was upheld in Coffey.

PN6097

DEPUTY PRESIDENT GOSTENCNIK: Yes, but we're not talking about Coffey now, we're just talking about a concrete testing company which is engaged in connection with civil and mechanical engineering duties performing concrete testing on site. So the company falls within the scope of the award, the On‑site Award. Its employees performing the testing work, what classification under the award would they be covered by?

PN6098

MS SOSTARKO: I would argue, your Honour, that that classification doesn't exist currently.

PN6099

DEPUTY PRESIDENT GOSTENCNIK: Doesn't it follow therefore that the coverage clause of the On‑site Award indicates an intention to cover some degree of On‑site Award testing?

PN6100

MS SOSTARKO: Yes.

PN6101

DEPUTY PRESIDENT GOSTENCNIK: Therefore, if that's the intention of the award wouldn't the modern awards objective require a classification, whatever it is, to support that coverage?

PN6102

MS SOSTARKO: If I could take that question on notice, your Honour, I would greatly appreciate that, so that we could get further instructions and consider that question.

PN6103

DEPUTY PRESIDENT GOSTENCNIK: All right.

PN6104

MS SOSTARKO: Thank you, your Honour.

PN6105

VICE PRESIDENT HATCHER: Anything in reply, Mr Crawford?

PN6106

MR CRAWFORD: Just very quickly on the Coffey decision, it's clear from paragraph 25 that the lack of specific reference to testing work was a problem for that Full Bench, although they do say the classifications - they're referring to the On‑site Award - are of a very general nature, when in my respectful submission that's clearly wrong. There are a number of specific references to classifications in the On‑site Award. I mean, I took this Full Bench through them before, so it's not correct to say that the On‑site Award has only general classifications. The problem is there's no specific reference just to this small category of work. That's it.

PN6107

VICE PRESIDENT HATCHER: All right, thank you. So next we have - look, we might take a short morning tea adjournment and we'll resume in 10 to 15 minutes with you, Mr Nguyen, in Sydney.

PN6108

MS HOGG: Your Honour, before you have that break, may I ask that I be excused for the rest of the day?

PN6109

VICE PRESIDENT HATCHER: Yes, you're excused, Ms Hogg. Thank you.

PN6110

MS HOGG: Thank you.

SHORT ADJOURNMENT [10.46 AM]

RESUMED [11.06 AM]

PN6111

VICE PRESIDENT HATCHER: Mr Nguyen.

PN6112

MR NGUYEN: Thank you, your Honour. Our submissions address the current problem which exists in the Building Construction Award which is the conflict between the current clause 43.5 and 43.2. Presently 43.2(b) seems to stipulate that employees who are paid the wage rates in clause 43.2(a), which is a table, will not receive overtime payments, shift work premiums, special rates, meal allowances, allowances for travelling and board, motor allowances, first aid allowances and other additional amounts specified in clause 25, whereas 43.5 stipulates that in paragraph (a):

PN6113

The conditions of employment that apply to employees covered by this part will not be less favourable than those prescribed under this award subject to (b).

PN6114

We say given this conflict there needs to be clarity as to which of the clauses should apply and we have done research into the history of the provisions to understand why exactly the form of words that are in the current award are the way that they are.

PN6115

There was a change which occurred in the Part 10A award modernisation proceedings which was not subject to any submissions from or by the parties, in particular the changes to the words to those two paragraphs. The change occurred after the exposure draft submissions went in and was included in the final award without any submissions or views put by the parties about those particular changes.

PN6116

So we went further back into the history and looked at the predecessor award from which this schedule is based, which is Appendix B of the National Metal and Engineering On-Site Construction Industry Award 2002 and we discovered that there was a significant change to the wording, in particular the predecessor to 43.2(b) included the words, and I quote, "The calculation of wage rates", and that was in 4.2.1 of Appendix B of the National Metal and Engineering On-Site Construction Industry Award 2002, and those words have now been replaced with the words in the current clause, and I quote, "Employees paid the wage rates".

PN6117

The second significant change which occurred is in the predecessor to clause 43.5(b) which was clause 7.2 in Appendix B which had the words, "Provided that". Those words have now been deleted from the current clause 43.5(b). So the history we say demonstrates that it's not the intention that employees who are covered by this schedule do not attract any of these conditions which are listed at 43.2(b). We say the interpretation should be that those items are only used for the purposes of calculations which are necessary to be conducted by the employer to determine whether the allowance is paid or the minimum base rate identified in the table is paid.

PN6118

If you look at the table in 43.2(a) there's a series of conditions and calculations which need to be made in order to determine whether the allowance is paid or the base rate is paid. The difference between our submissions and the Ai Group submission appears to be that the Ai Group are saying that the wage table at 43.2(a) is literal wage table that doesn't require any calculations and that it's a simple case of the employer just looking at the table and applying the table, and we say that's not possible looking at the history of the award and also looking at the actual words in the table because it's necessary for a calculation to be made, and therefore the words which were deleted, which were the calculation of the wage rates, is important because if you look at the table and how you interpret the table you do have to perform a calculation, and that calculation is what those specific items which are listed in 434.2(b) are excluded from, not the base rate which is the alternative to the allowance which is based on the calculation.

PN6119

If I can just explain quickly just use as an example 43.2(a) it says under "Foreperson":

PN6120

In order to determine the wage for the foreperson or supervisor, which is the first category of supervision of three or more tradespersons excluding leading hands, the average of the weekly wage rates for 38 ordinary hours of work including payments of applicable from time to time to the tradespersons, excluding leading hands, supervised by a foreperson supervisor, plus $138.59 or $841.10, whichever is the greater.

PN6121

So there's two options there. The first option is you calculate the average of the weekly wage rates for the people who are supervised and you add $138.59, or you choose $841.10, whichever is the greater. So it's necessary there to look at who the person is supervising and do a calculation of those people's wage rates, and we say that's what the application of 43.2(b) should be, which is the original words from the predecessor award which is that the calculation of the wage rates for that table do not include these items.

PN6122

We have included in our submissions the history going back further to the 1989 award as well and an extract from the 1989 award which is not as readily available on the website, which the Commission can view where the words are also the same, including the words "The calculation of wage rates." That concludes the summary of our submissions, your Honour, unless the Bench has any questions.

PN6123

VICE PRESIDENT HATCHER: Thanks, Mr Nguyen. Ms Paul, do you want to go next?

PN6124

MS PAUL: Yes, your Honour. I will be brief, your Honours as well. I refer your Honour to our submissions filed in this matter and in summary we simply say that the AMWU has miscast its application on the basis of claim this was an error. We say no error has actually been made, and also on the fact that the Commission did put some thought around the inclusion of the general foreman/supervisor, general foreman section into a different area, and in that process they have taken on board – I think the words the Commission had utilised was the fact that they have removed the foreperson/supervisor, et cetera, and special provisions reflect Appendix B of the National Metal Engineering On-Site Construction award.

PN6125

There is nothing in those words, your Honour, we say that changes or adds any weight to the AMWU's application that there has been some error in relation to the Commission's redrafting of that clause as it currently stands in the award. We say in fact as we do in our submissions that there is very little difference between – notwithstanding the words being used the outcomes are still the same, that it is intended as weekly wages, wage rates to be paid to a foreman/supervisor or general foreman/supervisor, and the calculation has already contemplated we say the payments that are now excluded. So there's no double dipping in terms of that.

PN6126

Without the fact that if the Commission finds that there is in fact no error then certainly we say that the claim, AMWU's claim fails because there is no merit argument to make that change and no evidence to support that has been put before this Bench.

PN6127

VICE PRESIDENT HATCHER: Ms Paul, just so I understand this, for example a general foreperson/supervisor supervising three or more tradespersons can be paid $818.40 a week.

PN6128

MS PAUL: Sorry, in terms of the 43.2 gets paid – so they get the average weekly wage rates for someone supervising plus $138.59 or $841.10, whichever is the greater. So they get the wages plus - - -

PN6129

VICE PRESIDENT HATCHER: In that case one result could be you get paid $841.

PN6130

MS PAUL: Yes.

PN6131

VICE PRESIDENT HATCHER: Then on that amount you don't get overtime.

PN6132

MS PAUL: Yes, your Honour, on the basis that you're not getting overtime based on the exclusion that that applies to sub-clause (b).

PN6133

VICE PRESIDENT HATCHER: You can work 50 hours and you get $841?

PN6134

MS PAUL: In accordance with sub-clause (b), yes, your Honour.

PN6135

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

PN6136

MS PAUL: I understand, your Honour, that it's no different to – if we take the words that were used in the previous awards that the calculation of wage rates shall exclude overtime payments, shift work premiums, et cetera. So under the method - - -

PN6137

VICE PRESIDENT HATCHER: Just as a matter of principle what's the basis for someone who gets $841 a week would not get overtime no matter how many hours they work?

PN6138

MS PAUL: Your Honour, the provisions seem to be that, and we address this in our submissions at 18 and 19, that similar foreperson and supervisors under the manufacturing award are paid a salary and don't receive overtime payments.

PN6139

VICE PRESIDENT HATCHER: What's the salary?

PN6140

MS PAUL: I am afraid I don't have that information, your Honour, I can certainly get that for you, but our understanding is that they are paid a salary and the award does provide for salary provisions, but the building award doesn't provide for detailed annualised salary. I am only extrapolating, your Honour, that for the purpose of the history of the building awards that may have been a reason in terms of the drafting to provide for the concepts of foremen and supervisors to be paid a salary and hence the rate of $841.10 in terms of the supervision of three or more, or $911.18 per week.

PN6141

DEPUTY PRESIDENT HAMILTON: It's a managerial exemption, isn't it, or is it something like that?

PN6142

MS PAUL: In a sense, and again I don't want to mislead the Commission, I don't have the history of how this occurred in relation to the various iterations of the award prior to the modern award, but it seems clear that there was always an intention around excluding payments of overtime and shift work, so it seems to be, if I can use the term, a salary clause in that sense, which is not dissimilar to what would be in other awards that provide for that facility.

PN6143

VICE PRESIDENT HATCHER: Conceptually there is nothing wrong with it, but it just seems to be an extraordinarily low amount to be described as an annualised salary.

PN6144

MS PAUL: Your Honour, I have no specific response in relation to that other than to say it was clearly intended in the award as such, in the current award, and certainly we say that the old MECA 2002 clause provides for the same result.

PN6145

DEPUTY PRESIDENT GOSTENCNIK: Ms Paul, under the predecessor awards where there was a reference to the calculation of wage rates - - -

PN6146

MS PAUL: Yes, your Honour.

PN6147

DEPUTY PRESIDENT GOSTENCNIK: So properly construed was that a reference to the way in which the minimum wage was to be calculated by reference to the other persons who are supervised that was to exclude those items?

PN6148

MS PAUL: Your Honour, that could be one reading of it. We say that it's on the basis to calculate the wage rates of 4.1, which is to result in that figure at the end of $818.40 would still result in the fact that that was intended, that you wouldn't – it's a broad term of wage rates, your Honour, it's not - - -

PN6149

DEPUTY PRESIDENT GOSTENCNIK: The wages clause in the predecessor part is not reproduced in the AMWU's submissions. Are you able to tell me what that provision actually provided?

PN6150

MS PAUL: I am sorry, your Honour – I believe, your Honour, I am looking at the 1989 version, not the 2004.

PN6151

DEPUTY PRESIDENT GOSTENCNIK: Yes, I am looking at the '89 version, at least in that which is extracted in the submissions.

PN6152

MS PAUL: I am sorry, your Honour, I don't have that at hand.

PN6153

DEPUTY PRESIDENT GOSTENCNIK: Mr Nguyen, are you able to help?

PN6154

MR NGUYEN: I do have it. It's not in a table, so this table was formulated by the award modernisation Full Bench without any submissions made by the parties about it. The predecessor award provisions contained the wage rates in the form of paragraphs. So there's 4.1 Part A and then it says – do you want me to just read out the paragraphs?

PN6155

DEPUTY PRESIDENT GOSTENCNIK: Yes, please.

PN6156

MR NGUYEN: It reads:

PN6157

The weekly wage rate for a foreman/supervisor (as defined) and a general foreperson/supervisor (as defined) shall be as follows: 4.1.1: Where three or more tradesmen, excluding leading hands, are supervised by a foreman/supervisor the weekly wage rates shall be calculated as follows: 4.1.1(a): "Foreman/supervisor".

PN6158

By adding $99.30 to the average of the weekly wage rates for 38 ordinary hours of work, including payments applicable from time to time to the tradesmen, excluding leading hands, supervised by a foreman/supervisor. Provided that where the weekly wage rate determined by this calculation is less than $608.70 the minimum wage rate to be paid shall be $589.70 per week. 4.1.1 - - -

PN6159

DEPUTY PRESIDENT GOSTENCNIK: It's all right, Mr Nguyen, I get the general gist of it, thank you.

PN6160

VICE PRESIDENT HATCHER: Yes, Ms Paul.

PN6161

MS PAUL: Your Honour, I guess in conclusion we say that, and we have provided an alternative, in our submissions on the basis that if the Bench was minded to accept that some variation was necessary then we say that the variation should be no more than re-inserting the words and adopt the words used in Appendix B of the MECA 2002 award without the AMWU's proposed notation. So the AMWU's proposed notation is potentially misleading and merely supports just their interpretation of this. We say if there is some level of which there should be a change then we say it should do no more than simply adopt the words as in the appendix wholly without any amendment to that.

PN6162

VICE PRESIDENT HATCHER: Does this process even constitute a properly established minimum rate?

PN6163

MR NGUYEN: They have – 4.1.3 was a paragraph which said the amounts set out in 4.1 have been adjusted to give effect to the 2002 safety net adjustments.

PN6164

VICE PRESIDENT HATCHER: I note that, but I am struggling to understand how a properly set minimum rate could be established by reference to some averaging process of what other employees are getting.

PN6165

MS PAUL: Your Honour, they are getting their weekly wage rate though as well. So at the end of the day the highest weekly wage rate paid for 38 to a foreman/supervisor, plus the 141 or 818, whichever is the greater, so the 141 is to contemplate for those additional payments. So they would still be getting – the minimum amount they would be getting is the highest weekly wage rate.

PN6166

VICE PRESIDENT HATCHER: Fine.

PN6167

MS PAUL: Thank you, your Honour.

PN6168

VICE PRESIDENT HATCHER: Ms Adler, do you want to say something about this?

PN6169

MS ADLER: No, your Honour.

PN6170

VICE PRESIDENT HATCHER: All right, so we are completed that topic. Mr Nguyen, you don't want to add anything?

PN6171

MR NGUYEN: Your Honour, if I can just add I think there's missing in this discussion the interpretation of 43.5(a) and (b). (a) indicates that the conditions of employment that apply to employees are covered by this part will not be less favourable than those prescribed under this award, and it says:

PN6172

Provided that where it has been the custom to do so the employer and the employee agree time off with pay may be taken instead of payment for overtime work, shift work or work on Sundays, et cetera.

PN6173

So if that clause in the previous awards included the words "provided that" which seems to indicate that there's a connection between the conditions of employment that apply to the employees covered by this part, and (b) which is supposed to be as an exception rather than how it currently reads, which is just as a general entitlement.

PN6174

If the words "provided that" are included then it seems clear that As intention was for overtime, et cetera, to be included as the conditions applicable to those employees, and that the TOIL clause is meant to be an exception to that entitlement to those conditions of overtime, et cetera. That change hasn't been reflected in the current award and the words "provided that" have been deleted without any reasons given by the Bench.

PN6175

I just say as well in terms of Ms Paul's indication that there was consideration by the Bench of including foreperson and supervisor the submissions about that point were very high level and about the concept of whether these category of employees should be included in the award rather than the terms and conditions that should be applicable to those employees.

PN6176

So I would say that if you look at the transcript and the submissions for the Part 10A award modernisation proceedings you will see that the discussion was really at that high level of should this category of employee be included, rather than, yes, they are included, what should the terms and conditions be. After those submissions went in when the final award came out was the first time that anyone saw this clause 43 forepersons and supervisors in a form that it exists in now.

PN6177

The fact that the person drafting it made the error indicates that there may be some possibility of ambiguity, which is why we say that there should be a note to clarify the interaction between 43.5 and 43.2(b). That's it, your Honour.

PN6178

VICE PRESIDENT HATCHER: Thank you. Next is the national training wage, Ms Sostarko. So is the process simply that schedule C be deleted and reference be made to the schedule in another award and you say that's what has been considered elsewhere by the other Full Bench?

PN6179

MS SOSTARKO: That's right, your Honour. So we would start off by noting that the circumstances here are not dissimilar to the payment of wages common issues matter, and we would submit that an appropriate course perhaps would be that those matters be considered in the common issue matter as far as the training wage, national training wage claims in the first instance.

PN6180

Master Builders have made submissions in both these proceedings and the common issue proceedings with regard to the national training wage schedule as well as clause 28 within the on-site award. The CFMEU I anticipate is going to contend that its claims with regards to clause 28 of the on-site award are not relevant to the matters before the national training wage common issue Full Bench.

PN6181

VICE PRESIDENT HATCHER: Just to be clear, so you're seeking to clause - - -

PN6182

MS SOSTARKO: What we are seeking is to adopt the model approach proposed by the Full Bench in the common issues matter.

PN6183

VICE PRESIDENT HATCHER: I will just find out from Mr Maxwell. So what's the issue here, Mr Maxwell?

PN6184

MR MAXWELL: The issue here, your Honour, is that in reading the MBA's submissions at paragraphs 15.1 to 15.3 they appear to seek a deletion in totality of clause 28, because under the National Building and Construction Industry Award - - -

PN6185

VICE PRESIDENT HATCHER: As distinct from just 28.1? Anyway your concern is that the minimum wages in clause 28.1 not be displaced.

PN6186

MR MAXWELL: That's correct.

PN6187

VICE PRESIDENT HATCHER: All right. Ms Sostarko, can you just deal with that issue.

PN6188

MS SOSTARKO: Yes, your Honour.

PN6189

VICE PRESIDENT HATCHER: That is the CFMEU is concerned that you are actually trying to get rid of the higher minimum trainee wages in clause 28.

PN6190

MS SOSTARKO: We are not seeking anything of that nature, we are simply seeking to be considered within the common issue matter and not be carved out of those considerations. I think the relevant point quickly to make for your benefit here is that Mr Maxwell has proposed amendments to the common proposed model schedule - - -

PN6191

VICE PRESIDENT HATCHER: We will come to that, but just look at clause 28.

PN6192

DEPUTY PRESIDENT HAMILTON: What changes do you make as 28?

PN6193

MS SOSTARKO: That that clause be deleted.

PN6194

VICE PRESIDENT HATCHER: But that's with respect more than what is being considered by the other Full Bench, is it not? They're simply considering a structural change to reduce the amount of pages.

PN6195

MS SOSTARKO: My apologies, your Honour, the existing clause be deleted and replaced with the reference as proposed by - - -

PN6196

VICE PRESIDENT HATCHER: Yes, but what happens to these minimum wages?

PN6197

DEPUTY PRESIDENT HAMILTON: 28.2 and 28.3.

PN6198

MS SOSTARKO: The revised schedule that has been put forward, the model schedule, which has been – the parties haven't been invited to put proposals forward on – then incorporates those provisions.

PN6199

VICE PRESIDENT HATCHER: Incorporates these higher wages?

PN6200

MS SOSTARKO: The higher wages?

PN6201

VICE PRESIDENT HATCHER: These wages in 28.2 and 28.3.

PN6202

DEPUTY PRESIDENT HAMILTON: It couldn't because the training rate schedule applies to everybody in schedule C and sets rates for everybody in schedule C, doesn't it? It has been a while since I have looked at it. So if you raise everybody in schedule C to these new rates it will go across the economy which is obviously not intended.

PN6203

MS SOSTARKO: If I could take that question on notice I would like to consider that question in more detail.

PN6204

VICE PRESIDENT HATCHER: I think this is the issue, Ms Sostarko, that the CFMEU are saying that – perhaps I am putting this more baldly than they have, that this is a back door way to get rid of the trainee minimum wages in 28. I just want to make it clear, is that right or is that wrong? I mean if it's not we can forget about it.

PN6205

MS SOSTARKO: I think I will ask Mr Schmitke to answer this question if you don't mind, your Honour.

PN6206

MR SCHMITKE: Your Honour, the initial proposal that we filed was to have this particular clause removed and that there be instead – and when I say this particular clause I mean clause 28 in its entirety – and instead we consider that it would be better to have a particular reference back to a schedule attached to the Miscellaneous Award on the basis that we didn't necessarily consider that there was any reason as to why the building construction sector with respect to these types of matters should be distinct from any other sector.

PN6207

That claim was advanced I think when the Master Builders first filed documents in this proceeding sometime in early 2015. The president in another matter has subsequently adopted – not adopted the same holus bolus approach, but of course noted that there is a benefit in having a single schedule and having various awards make reference to it.

PN6208

It has been our view that we should have that particular approach adopted and we have been involved in that Full Bench proceeding in front of Justice Ross.

PN6209

VICE PRESIDENT HATCHER: Mr Schmitke, how are you going to retain the existing higher rates in 28.2 and 28.3 if they're attached to the Miscellaneous, or if you just simply refer the Miscellaneous Award?

PN6210

MR SCHMITKE: Yes. So in that particular proceeding in front of his Honour Justice Ross, the president, there was a call for – the parties were invited to make a submission with respect to the course that he had adopted, and if they disagreed with that course they were invited to make submissions. Mr Maxwell and a number of other unions put in a submission to say we don't think that the course proposed was appropriate, there should be a standardised approach, and that the building and construction sector is different and therefore a tailored approach might be required. The president has subsequently issued a model schedule reflecting I suppose some of the issues that Mr Maxwell had raised and we are seeking to make submissions with respect to that schedule.

PN6211

So this is I suppose the difficulty; if it is the case that this Bench proceeds to hear and determine the matter that Mr Maxwell has raised there is in fact a potential implication with respect to the other proceeding.

PN6212

VICE PRESIDENT HATCHER: It's not just Mr Maxwell's matter it's your matter.

PN6213

MR SCHMITKE: Yes. No, I understand that and that's why we had made enquiries of the Commission insofar as the way in which it wanted the matter handled, because - - -

PN6214

VICE PRESIDENT HATCHER: In terms of just the administrative change you can deal with this by saying – instead of saying in 28.1 the provisions of schedule C will apply in respect of traineeships save that, et cetera, you will just say the provisions of schedule X of the Miscellaneous Award will apply in respect of traineeships save that, and then keep the rest.

PN6215

MR SCHMITKE: That may well be one way of doing it, but that was not the original - - -

PN6216

VICE PRESIDENT HATCHER: That's not your proposal?

PN6217

MR SCHMITKE: No.

PN6218

DEPUTY PRESIDENT HAMILTON: Your proposal is not to delete 28.2 and 28.3 and leave those higher rates in place in some document, is it?

PN6219

MR SCHMITKE: Correct, yes, that's right.

PN6220

DEPUTY PRESIDENT HAMILTON: Whether the Miscellaneous Award or here.

PN6221

MR SCHMITKE: Well, that's exactly right, but - - -

PN6222

DEPUTY PRESIDENT HAMILTON: Then you have a joint objective on that.

PN6223

MR SCHMITKE: Sorry, your Honour, let me just qualify that. It was our preferred view that there be no distinct rates and that there be a standard schedule. Notwithstanding that there is now a discussion on the other matter with respect to a higher rate as in distinct industry related rates of pay. So to that end we are now engaged in I suppose responding to Mr Maxwell's proposal in that other matter, notwithstanding the fact it's inconsistent with our original intention, but we have got no choice but to respond to that particular proceeding.

PN6224

I suppose the simple – when I say the simple point the overarching point that we would seek to make is that there's a potential for crossover here. I have adduced evidence in this matter with respect to Mr Wilson who's our training specialist from Master Builders Australia. Notwithstanding that we don't press that claim, that we have indicated it will be withdrawn, we would very much - - -

PN6225

DEPUTY PRESIDENT HAMILTON: What has been withdrawn?

PN6226

MR SCHMITKE: The junior rates. Yes. We would very much need his persistence in terms of the specialist information he provides about this. So we say that it's not dissimilar to the national training wage matter, in fact that was very similar to this situation. It had claims in, seized before another Bench, and then you had the number of concurrent proceedings going on. It's a feature of course for their review. It's a massive task, we understand these things happen, and in fact we appreciate the fact that the president has sought to distinguish these particular areas.

PN6227

VICE PRESIDENT HATCHER: All right, I think I understand that. So, Mr Maxwell, your CFMEU proposal is that being ventilated in the other matter as well?

PN6228

MR MAXWELL: No, it's not, your Honour. Your Honour, I am still not clear on the position of the MBA, because when you look at attachment A to their written submission the variation that they identified to clause 28, which is found on page 35 of the MBA submission, obviously seeks to delete the existing wage rates in clause 28.

PN6229

VICE PRESIDENT HATCHER: Yes. I haven't seen or heard any sign that they have withdrawn the claim.

PN6230

MR MAXWELL: So as to the extent that that claim is still before the Commission we deal with that in paragraph 230 of our written submission. There is no evidence to justify such a variation and we submit that the existing wage rates in 28 remain in response to the MBA claim. We then have a separate claim before the Full Bench.

PN6231

Our claim is to vary clause 28.2 in regards to the civil construction traineeships. We don't seek to vary the wage rates. What we seek to vary is to add a (ii) to 28.2 to give some explanation about how people progress through wage rates at stage 1, 2 and 3. WE have explained that when the provision was first inserted it was based on competency base wage progression and there was identified competencies for each of those stages. That has now moved on with the development of training packages, and what we now see is a competency base – a combination of competency base wage progression or time served approach, which is consistent with that determined in the appendices 2012 decision of the Full Bench. That is the variation that we seek there and we explain in our written submissions why we seek that. We also understand that there is another application by the AiG which we support.

PN6232

VICE PRESIDENT HATCHER: Do you want to address the AiG variation?

PN6233

MS PAUL: Yes, your Honour. Our variation is actually quite minor, your Honour, it's only in relation to the terminology in the current award at 28.3. It uses the term skill level B and skill level A. That term is not found anywhere else in the award, and in fact cross referencing back to the national training wage schedule the terminology that is actually used is actually wage level. We are just seeking for the term "skill levels" to be replaced with the terms "wage levels". I understand that this is not being opposed by any of the parties.

PN6234

VICE PRESIDENT HATCHER: All right.

PN6235

MR CRAWFORD: Sorry, Your Honour, can I just note our support for the CFMEU claim, our strong opposition to the MBA claim, and I note that that change would require work value considerations.

PN6236

VICE PRESIDENT HATCHER: Mr Schmitke?

PN6237

MR SCHMITKE: Well, your Honour, I can probably assist the Commission no more. As I say it was our genuine understanding, and I think the documents provided to the parties reflected that there was some uncertainty with respect to how this particular aspect of the claim was going to be dealt with, it was unclear, and to that end we say no more.

PN6238

We don't necessarily agree – in fact we would not support Mr Maxwell's application. I think Mr Wilson in fact did provide evidence on matters other than junior rates. That included evidence with respect to the concerns held by Master Builders and the response that he has and the feedback he has received from members with respect to competency-based training, some concerns with respect to the suitability of candidates coming through that training. So it's our concerns with respect to the incentives that perhaps uncharitably could be created by some of the payment methods to registered training organisations, a whole raft of issues.

PN6239

In the event the Commission chooses to do so we would seek to rely on the evidence that Mr Wilson has given with respect to the matters that Mr Maxwell has addressed. Notwithstanding that it is still our position that it would be the most effective approach for the two issues to be determined concurrently, and in the event just like the payment of wages matter there is in fact industry specific or a building construction specific aspect that arises from the proceedings in front of the president, and of course I would expect that to be the case because it seems to always be, then it can be returned back to this Bench perhaps concurrently with the national training wage matter.

PN6240

VICE PRESIDENT HATCHER: Yes, all right. Thank you. So living away from home allowances. Mr Maxwell?

PN6241

MR MAXWELL: Thank you, your Honour. Just bear with me for a second.

PN6242

VICE PRESIDENT HATCHER: Sorry, not allowances, living away from home.

PN6243

MR MAXWELL: Your Honours and Commissioners, the CFMEU claim in regards to the living away from home distant work provision of the award is dealt with in paragraph 13 found on page 6 of our written submissions in support through to paragraph 160, which is found on page 72 of our written submissions in support.

PN6244

The CFMEU recognises that our claim is a substantial claim. We have provided witness evidence to support our claim, research on accommodation and meal costs to support our claim, the arbitral history of provisions to support our claim, research and government inquiry reports to support our claim. We have provided more material in support for this claim than any other matter that is before the Bench in these current proceedings.

PN6245

In paragraph 14 of our written submissions we identify the changes that we seek to the clause, and I identified those in the opening submission that I made. In regard to the change that we seek to clause 24.2 what we seek there is to insert a provision to preclude employers putting undue pressure on employees to provide a false address.

PN6246

Witness evidence in support of that proposal has been provided in regard to the witness evidence of Mr O'Grady, Mr Kelly and Mr Pallot. Just for the ease of the Commission the witness evidence of Mr O'Grady is found in exhibit 11; the witness evidence of Mr Kelly is found in exhibit 30, and the witness evidence of Mr Pallot is found in exhibit 35.

PN6247

VICE PRESIDENT HATCHER: Wouldn't it be more effective to require the employer to verify the address that's supplied?

PN6248

MR MAXWELL: Well - - -

PN6249

VICE PRESIDENT HATCHER: It's already that the employer can request proof, but maybe if it was changed to require proof so that the employer has an obligation to verify that the address supplied is the actual address.

PN6250

MR MAXWELL: That may be a better way of dealing with it, or one way could be that they provide the address that's contained within their superannuation, that's used for their superannuation statements, the address that those are received at, or their long service leave.

PN6251

VICE PRESIDENT HATCHER: Or their driver's licence.

PN6252

MR MAXWELL: Or their driver's licence. That may be one way of dealing with it, but our concern is at the moment what happens is people give a local address and it ends up being the local caravan park.

PN6253

DEPUTY PRESIDENT HAMILTON: Mr Maxwell, you rely on, you refer to the witness evidence. It was somewhat negative in nature. I think you described these places as prisons, and - - -

PN6254

MR MAXWELL: Your Honour, I think that that was in relation to the extent to which employees living in camp. I am not referring to – I am just trying to differentiate between camp sites which may be used for an employee's address as opposed to construction camps where people are houses on major projects. So I think there is a distinction between the two.

PN6255

DEPUTY PRESIDENT HAMILTON: I am sure there is, but overall the witness evidence was very negative about this distant work. I don't think he mentioned the positive aspects of the work, including the wages and swimming pools and the like, except in cross-examination. Is that relevant to whether we should accept the evidence or not?

PN6256

MR MAXWELL: Your Honour, we say you should accept the evidence because they go with issues facing the workers of a requirement to work in camp. Yes, they may provide swimming pools, they may provide tennis courts, but if you're working a 12 hour shift starting at 6 o'clock in the morning and going through until 6 o'clock at night the extent to which you are then going to be of mind to go and play tennis I would submit is fairly small given that you have then got to be up within the next ten hours to start another 12 hour shift.

PN6257

DEPUTY PRESIDENT HAMILTON: No, I understand, but in a sense you accented the negative aspects of that work in your witness statements. Would it be appropriate to describe the witness statements as somewhat one-sided in their presentation of the nature of the work and conditions at those sites almost by definition?

PN6258

MR MAXWELL: I wouldn't accept that in that some of the witness statements recognise that people do the fly-in fly-out work because of the increased rates of pay that they receive on those projects, and that is one of the reasons why people do it, and also because there's a need to follow work, because if you specialise in that area of construction, well then you're required to follow work.

PN6259

DEPUTY PRESIDENT HAMILTON: Thank you.

PN6260

MR MAXWELL: Just returning back to this issue about the address issue we have also referred in our written submissions to disputes that have come before the various tribunals and they are dealt with in paragraphs 23, 25 and 26 of our written submission.

PN6261

If I can then turn to the issue of the increase in daily and weekly allowances. In paragraph 31 we summarise the three options that currently exist under clause 24.3 of the award, and they are to pay an allowance on a weekly or daily basis or provide reasonable board and lodgings in a well-kept establishment with three adequate meals a day, or (3) if the employees are required to live in camp provide all board and accommodation free of charge.

PN6262

Supported by the evidence of Mr O'Grady the most common practice is for employers to provide accommodation and meals. A growing practice is to provide accommodation and an allowance for meals and accommodation, but that provision currently isn't available under the award.

PN6263

In clause 24.3(a)(i) of the current award it sets the amounts for the allowances to cover accommodation and meals. Those current award rates are $478.44 per week and $68.45 per day. We submit that these amounts under any reasonable assessment are woefully inadequate. The rationale and (indistinct) history of the payments is dealt with in paragraphs 35 to 41 of our written submission and in Appendix 2 we contain the various variations we've gone on through that overall history.

PN6264

In paragraph 42 of our written submissions we refer to the decision of Commissioner Merriman which identified how the allowance for board and lodging was determined in that award. In that matter Commissioner Merriman was dealing with an application to vary the Australian Workers Union Pipeline Construction Western Australia Award 1982, and he found:

PN6265

In my view the allowance which was established in April 1983 was based on an averaging concept involving hotel costs, caravan parks, flats and other accommodation costs. The range of accommodation was envisaged at the time the allowance was established and I do not believe the material placed before me justifies any increase. The concept adopted in April 1983 allowed for a wide range and type of accommodation which in my view provided ample scope for the period of this project.

PN6266

What we take from that decision is that in determining these allowances in terms of accommodation you take the averaging costs across hotels, caravan parks, flats and other accommodations. We are unable to find any other recent decision or decision in the last 40 years that specifies how those allowances should be calculated, and so we therefore sought to use the methodology identified by Commissioner Merriman in developing our claim.

PN6267

In paragraphs 44 to 46 of our submissions in support we identify what we consider to be the acceptable standards in the modern day of reasonable lodging, and we submit that that is equivalent to a three star hotel. So we are not claiming five star accommodation, we're not claiming four star accommodation, we are saying three star accommodation. We believe that is a reasonable comparison.

PN6268

VICE PRESIDENT HATCHER: But in places where people are doing construction projects away from home and they're obtaining their own accommodation is that even relevant, is there three star accommodation available?

PN6269

MR MAXWELL: Well, your Honour, we have not only looked at three star accommodation, we have also looked at – well, okay, the other alternative is that those employees may rent a house or a unit for the time that they're there.

PN6270

VICE PRESIDENT HATCHER: Did the evidence disclose an example of a distant construction project where employees are providing their own accommodation and meals?

PN6271

MR MAXWELL: Sorry, your Honour?

PN6272

VICE PRESIDENT HATCHER: Was an example given as to where this might actually operate?

PN6273

MR MAXWELL: Not in regard to remote construction, but that just doesn't deal with – the award clause doesn't just deal with remote construction.

PN6274

VICE PRESIDENT HATCHER: No. I am just trying to think of an example where you're living away from home and the employer has taken the option of paying the allowance and the meals, and where that might be and what might be available.

PN6275

MR MAXWELL: To give an example – there are various specialist companies that operate in the industry. So for example you have specialist air conditioning installation companies. So when they built the new hospital in Adelaide there were workers that were sent from Sydney to Adelaide to install the air conditioning. Those workers - - -

PN6276

VICE PRESIDENT HATCHER: You're just asserting this now, are you?

PN6277

MR MAXWELL: Sorry, your Honour?

PN6278

VICE PRESIDENT HATCHER: You're just asserting this.

PN6279

MR MAXWELL: No. I - - -

PN6280

VICE PRESIDENT HATCHER: It seems to me that to do this exercise you would have to have some sort of analysis of where the work is being performed, what accommodation and food is available at those locations and how much it costs, and I don't see that in the evidence.

PN6281

MR MAXWELL: Your Honour, in appendices 3 and 4 - - -

PN6282

DEPUTY PRESIDENT HAMILTON: What page?

PN6283

MR MAXWELL: Appendix 4 starts - - -

PN6284

DEPUTY PRESIDENT HAMILTON: Page 143?

PN6285

MR MAXWELL: - - - on page 146. In Appendix 3 we identify how the Australian Taxation Office calculates what they consider to be reasonable amounts for accommodation and meals in - - -

PN6286

VICE PRESIDENT HATCHER: You are putting all these establishments into the mix without any evidence that these are relevant to construction workers living away from home. For example there's all these Hobart hotels and motels put into the mix, but what's the evidence that there's anybody living away from home constructing something in Hobart, as distinct from Bathurst or Orange or some freeway in the north coast?

PN6287

MR MAXWELL: There is no evidence of people in those locations, but there is evidence before you that people are working in Karratha.

PN6288

VICE PRESIDENT HATCHER: Karratha?

PN6289

MR MAXWELL: Karratha.

PN6290

VICE PRESIDENT HATCHER: Providing their own accommodation?

PN6291

MR MAXWELL: Not in regard to providing their own accommodation, but, your Honour, perhaps if I can take a step back. The allowance isn't paid at the request of the employee, the allowance is paid based on a decision of the employer. The option is for the employer to pay the allowance or provide the accommodation. So what we say is that in those cases where the allowance is paid it is normally the situation where the employee has little choice.

PN6292

VICE PRESIDENT HATCHER: But is there any employer in the Karratha district who requires people to find their own accommodation in Karratha?

PN6293

MR MAXWELL: Your Honour, we provide no evidence to that, but at the end of the day the Commission is required to set a fair and reasonable safety net for employees that live away from home. Clearly the current allowances in the award are not reasonable. If we take the daily rate of $68.45 per day I put it to the Commission where in Australia can you get accommodation and pay for meals for $68.45.

PN6294

If the Commission recognises that those rates are inadequate then the question is how are you going to fix a new rate, and that is what we have sought to deal with in our application, and we sought to follow the methodology used by Commissioner Merriman. So we have provided evidence of what are the accommodation costs across Australia.

PN6295

VICE PRESIDENT HATCHER: I thought a better approach would be to find an actual example of workers living away from home and having to obtain their own accommodation and then actually finding out how much it's costing them.

PN6296

MR MAXWELL: Your Honour, there is in the attachment to the witness statement of David Kelly a statement from a worker who was required to live away from home in Perth and he talks about the amounts that he received and the extent to which they were inadequate to meet his needs.

PN6297

VICE PRESIDENT HATCHER: So what exhibit was that, Mr Kelly?

PN6298

MR MAXWELL: Mr Kelly's statement is exhibit 30.

PN6299

VICE PRESIDENT HATCHER: Attachment 1, is it?

PN6300

MR MAXWELL: Yes. It's found on page 168 of our written submission.

PN6301

VICE PRESIDENT HATCHER: Was he obtaining his own accommodation? He talks about the meal allowance. He doesn't - - -

PN6302

MR MAXWELL: He's provided accommodation by the employer, but he is then paid an allowance for the day to cover the cost of meals.

PN6303

VICE PRESIDENT HATCHER: Yes, all right.

PN6304

MR MAXWELL: So, your Honour, in terms of our Appendix 4 we have sought to follow the methodology used by Commissioner Merriman and we have sought to provide the costs of a one night accommodation in those locations using the (indistinct) of three star accommodation, a double bed hotel, free parking and laundry, which we say would meet the standards.

PN6305

We have identified the average for capital cities. We have identified the average for high cost country centres. We have identified the average for other country centres. In looking at all those averages and then taking the average of those we arrive at for accommodation only a rate of $118.35 per day. That is just for accommodation. But we have not just looked at that, we have also looked at we recognise that if employees are going to a capital city the likelihood is if they're not in an apartment they may find accommodation in a rental unit or house, and we have then looked at what are the median rental costs in a range of locations, and that's contained in Appendix 5, and across those areas we have arrived at an amount for a house of $363.15 and for a unit $290.04.

PN6306

We then factored that into doing an average between three star accommodation and private rental accommodation to arrive at what we say is an appropriate amount.

PN6307

DEPUTY PRESIDENT HAMILTON: Mr Maxwell, in paragraph 200 you say you don't know the cost impact of these proposals. It seems to me that if you don't know the cost of that we don't either, and it's somewhat difficult to consider an application when we don't know what the cost impact is.

PN6308

MR MAXWELL: Your Honour, you don't know what the cost impact is on an employer now, but you do have an idea of whether the existing allowance is fair or reasonable.

PN6309

VICE PRESIDENT HATCHER: Indistinctively it seems to me it would be fairly rare that an employee would be required to just go out and buy their own accommodation as distinct from an employer saying you will stay here and I will pay the costs.

PN6310

MR MAXWELL: Your Honour, that is dealt with in the witness evidence that we provided of our witnesses where they say it does occur within the industry.

PN6311

VICE PRESIDENT HATCHER: Who described that?

PN6312

MR MAXWELL: I will have to find their evidence, but I believe it's in regard to the witness evidence of Mr Kelly and Mr O'Grady, but I will stand corrected, I will need to check that. So based on calculations that we have done, and we set it out in paragraph 53 how we arrive at the amount that we claim, summarising the findings of my research we say in paragraph 62 that the basis for our claim is $133.55 per day and $913.88 per week.

PN6313

The next part of my claim is to include a provision in the award that allows for accommodation only to be provided and the payment of an allowance for meals, and we note that the CCF has also made a similar application to vary the award to make such a provision.

PN6314

The CCF don't indicate an amount that they seek. In our claim we indicate that we seeks amounts of $15 for breakfast, $15 for lunch and $30 for an evening meal. In paragraphs 65 to 68 we provide the merit-based arguments on why the provision we seek should be inserted.

PN6315

Our claim also includes updating the minimum accommodation standards contained in the award, and that's dealt with in paragraphs 69 to 85 of our written submission. The clause we seek is set out at paragraph 69, and you will see that in the new clause 24.3(b) we state:

PN6316

The accommodation provided will be of a reasonable standard having regard to the location in which work is performed.

PN6317

Then we say "Including a provision of" and we deal with a single room, et cetera, a reasonable ablution, laundry, and in (3):

PN6318

Communication facilities including email and internet access and mobile phone coverage or other radio or telephone contact where mobile coverage is unavailable.

PN6319

VICE PRESIDENT HATCHER: What is new there?

PN6320

MR MAXWELL: What's new there is in the one single room not shared.

PN6321

VICE PRESIDENT HATCHER: Yes.

PN6322

MR MAXWELL: We deal with an ensuite with toilet.

PN6323

VICE PRESIDENT HATCHER: Air conditioning is new, is it?

PN6324

MR MAXWELL: Air conditioning is new. Suitable ventilation is new.

PN6325

VICE PRESIDENT HATCHER: What, is it all new?

PN6326

MR MAXWELL: (1) is new, (2) is covered in the existing 24.3(b), and (3) is a variation on the existing provision in 24.3(a) – sorry, 24.3(b). In regard to evidence in support of our variation we refer to the ILO recommendations on workers housing in safety, health and construction. We refer to the recent disputes before the Commission over the issue and they're found in paragraphs 74 and 75 of our written submission. We refer to the Queensland Inquiry Court from the October 2015, which is the inquiry into fly-in fly-out and other long distance commuting work practices in regional Queensland, and we deal with that in paragraphs 76 to 77.

PN6327

We also refer to the June 2015 Parliament of Western Australia Legislative Assembly Education and Health Standing Committee, final report on the impact of FIFO work practices on mental health, and you will see in paragraph 78 we quote from that report where they deal specifically with the issue of accommodation, and they distinguish between the types of accommodation that they found applied for – accommodation for production workers on remote projects as opposed to accommodation provided for construction workers on remote projects, and they noted that the accommodation for those in construction was of a temporary, demountable and smaller.

PN6328

VICE PRESIDENT HATCHER: One issue I anticipate the MBA will raise is that on major projects contractors don't have any effective control over the accommodation, that it's provided by the head entity and they just put their workers in what has been provided.

PN6329

MR MAXWELL: To some extent we accept that, however when you look at the major contractors on a number of those projects they also employ people as construction workers, and so to the extent that they are then bound by – or that they are required for any agreements to meet the boot test. If that boot test contains the high standard then they would comply with those requirements.

PN6330

DEPUTY PRESIDENT GOSTENCNIK: Not necessarily, it depends on the overall assessment, not just a line by line assessment. So accommodation provisions might be different, but the wage rate is so superior as it might be adjudged as offsetting and therefore employees being better off overall. It's not the case that simply because their enterprise agreement might contain a lesser accommodation standard that the agreement would fail the boot test.

PN6331

MR MAXWELL: Your Honour, to some extent that would then become a valued judgment for the Commission to determine, but we say it will have an influence on the level – varying the award would have an influence on a level of standard that are provided not by the head contractors on these projects and therefore would then benefit those other workers that are working onsite.

PN6332

DEPUTY PRESIDENT HAMILTON: I kept coming back to your actual proposal, are we still dealing with 24.3(b)?

PN6333

MR MAXWELL: We are.

PN6334

DEPUTY PRESIDENT HAMILTON: What would all that cost and how practical is it? I have no idea how practical it is for some of these remote sites, and I don't know what it will cost, and I don't know what the overall cost is and nor do you on your own submission.

PN6335

MR MAXWELL: Your Honour, I think if you go through the cross-examination of the witnesses - Mr Schmitke spent a considerable amount of time cross-examining our witnesses, asking about the standard of accommodation that was found on these projects, whether they're provided with king size single beds, whether they're provided with ensuites and so forth. So we say that for a significant number of the projects those standards were already met.

PN6336

DEPUTY PRESIDENT HAMILTON: It wasn't as I recall – I don't want to be precise about this, but I think in some cases some of these issues were not provided on the witness evidence, and that would therefore be a change of some sort, and I don't know how practical it is or what the cost is.

PN6337

MR MAXWELL: To that extent I – well, we say it would have no cost for existing projects. There may be a cost for new projects, but that would be taken into account in the overall when bodies are tendering for new projects, and that will be a factor taken into account.

PN6338

DEPUTY PRESIDENT HAMILTON: All right. Thank you.

PN6339

MR MAXWELL: In regard to those issues, the standard we seek, we say that the standards we have identified there are equivalent to a three star hotel for those employees that don't live in camps.

PN6340

In regard to the provision of communication facilities in our 24.3(b) we highlight the move from communication by mail to now that more communication is done electronically over the internet by things such as Skype and Facetime and emails and we say those modern forms of communication are identified in a recent senate committee report on post offices, and that's referred to in paragraph 81 of our written submission where they found that the "e" substitution such as SMS, email and internet have seen significantly shifts away from letters, for example use of email or the internet for banking services. So clearly there is a technological shift going on in terms of the way that people communicate, and we say that's recognised in the award provision.

PN6341

We also refer to the Queensland Inquiry Court and what they had to say on access to technology and communications, and that's found in paragraph 82 and paragraph 83 of our written submission. We also refer to the recommendation from the WA Inquiry Report in paragraph 84 where they recommended that the Code of Practice of FIFO work arrangements emphasises the importance of providing high quality reliable and accessible communication technology in FIFO accommodation camps.

PN6342

We also refer to witness evidence in terms of cross-examination – sorry, the witness evidence of Pallot, Reilly, Woodward and Callaghan and the cross-examination of Pallot.

PN6343

In regard to the issue of the provision of a specific room in a camp accommodation we deal with that in paragraphs 86 to 93 of our written submission and we rely on the recent dispute on the Woodside Pluto project which we refer to in our written submission, and again the written evidence of Pallot, Ferreira, Callaghan and Reilly, the IOL recommendations, the Queensland Inquiry Court and the WA Inquiry Court.

PN6344

In regard to the variation to the weekly and daily camp allowances they're dealt with in paragraphs 94 to 105 of our written submission and we refer to a number of arbitrated decisions that are specifically relevant to this issue. In regard to the variation in relation to transport to and from distant work that's dealt with in paragraphs 106 to 109 and we rely on our written submission.

PN6345

The final part of the variation that we seek concerns rest and recreation. In paragraph 111 we set out what changes we seek. In paragraphs 112 to 123 we set out the history of the provisions in the awards, and in paragraph 114 we refer to the National Building Trades (Construction) Award 1975 award where rest and recreation is allowed at two months continuous service and thereafter at three month intervals.

PN6346

In paragraph 115 in 1977 the two days paid rest and recreation leave was introduced, and in paragraph 116 that in 1976 the reference to air travel was introduced into the award. In 1986 rest and recreation after ten weeks was introduced in the North West Shelf, and in 2009 when the modern award was made it provided for rest and recreation after four months where air travel only – it is the only practical means of transport, but after ten weeks in civil construction.

PN6347

In paragraph 124 we summarise the three different entitlements under the modern award, and just to briefly take you there, you will see that under the current modern award there are three different entitlements for rest and recreation. There is weekend return home after two months and thereafter at three monthly intervals, (indistinct) continuous service where travel is by rail or road travel. There is return home after four months continuous service with two days paid leave in addition to the weekend where air transport is the only practical means of travel, and thereafter at four month intervals with two days leave one of which is to be paid. There is return home after ten weeks continuous service, plus the same paid days of leave and thereafter at four monthly intervals where air transport is the only practical means of travel for employees in the civil construction sector.

PN6348

In paragraphs 125 to 149 we provide the evidence in support of our claims. These include paragraphs 126 to 131 where we refer to the February 2013 House of Representatives Standing Committee on Regional Australia and their report, Cancer of the bush or salvation for our cities? We refer in paragraphs 132 to 136 to the 2015 Queensland Inquiry Report, and in paragraph 133 we note in that reference there it gives an indication of the number of people for example that were involved in fly out to a drive out construction and the (indistinct) and it was approximately 14,490 persons. In 134 the report deals with rostering practices and there's a reference there to the report where they deal with the different types of roster, four weeks on, one week off and three weeks on, one week off.

PN6349

In paragraphs 137 to 142 we refer to the 2015 Western Australian Inquiry Report. In 138 it recognises that 80 per cent of construction workers engage in the resource sector on a fly-in fly-out basis. Paragraph 140 deals with rosters and in 141 it deals with compression creep and compression creep is this issue of where employees at the end of time on the job then go home the day's travel eats into the time that they have available at home with their families.

PN6350

We have provided witness evidence from Josh Burling, exhibit 13, Danny Callaghan, exhibit 31, Roland Cummins, exhibit 14, Paul Ferreira, exhibit 36, David Kelly, exhibit 30, Frank O'Grady, exhibit 11, Graham Pallot, exhibit 35, Dean Reilly, exhibit 12, and Chris Woodward, exhibit 37, to support our claim, and I strongly urge the Full Bench to read the personal accounts of the worker and his wife that's attached to the witness statement of David Kelly which I took you to earlier.

PN6351

In paragraphs 144 to 146 we provide information from an online petition which can be accessed on the Megaphone website and include a range of comments from the signatories to that submission.

PN6352

We submit that we have provided substantial probative evidence going to the facts we say exist and which justify the variations we seek. We have addressed the financial impacts to the extent that we can on employers of all of our claims in paragraphs 197 to 202. We have addressed the appropriate legislative provisions including the modern award's objective in paragraphs 203 to 220. We submit that we have met the requirements identified in the preliminary jurisdiction's decision and the Commission should therefore approve the variations that we seek.

PN6353

VICE PRESIDENT HATCHER: So the rest and recreation clause would require a three in one roster.

PN6354

MR MAXWELL: Yes.

PN6355

VICE PRESIDENT HATCHER: So what happens to existing projects that are operating on a different roster, which is basically all of them I think.

PN6356

MR MAXWELL: Your Honour, one way of dealing with that is to make the variation that we seek apply from a future date.

PN6357

VICE PRESIDENT HATCHER: Most of the existing projects would be the subject of enterprise agreements, would they not, which contain their own specific rostering arrangements.

PN6358

MR MAXWELL: And to that extent they would not be covered by the award variation unless there was, I suppose, some - - -

PN6359

VICE PRESIDENT HATCHER: An outlier.

PN6360

MR MAXWELL: Yes.

PN6361

VICE PRESIDENT HATCHER: So if we are being frank about this what's driving this is you want to use this as a tool in Greenfields agreements and future projects to get three in one rosters. That's the reality of it, isn't it? It's not a criticism.

PN6362

MR MAXWELL: No. We don't accept that that is the only reason we are seeking this variation. We are seeking this variation because there are building and construction workers across the industry who are required to live away from home for up to two months under the award with no requirement to return home to see their families. That is the issue we seek to address.

PN6363

DEPUTY PRESIDENT HAMILTON: But also is the three in one roster issue.

PN6364

MR MAXWELL: There is a three in one roster. There may be other alternatives to deal with the issue we have sought to address, but we see the three in one roster as a way of addressing it.

PN6365

VICE PRESIDENT HATCHER: All the witnesses you called were covered by enterprise agreements, and is there any evidence that this sort of a project where these considerations apply are carried out by award dependent employers?

PN6366

MR MAXWELL: Your Honour, there is the witness evidence of Mr Callaghan who said that he's worked on projects where he wasn't covered by the award. That's not by an agreement. Your Honour, I think to be blunt and honest with the Commission it's not surprising that the CFMEU can't find evidence of employees that are not covered by enterprise agreements. We submit that our members would leave us in droves if we weren't able to achieve enterprise agreements for them, and obviously we have a problem finding people that are just covered by the award.

PN6367

VICE PRESIDENT HATCHER: But even if you have a contractor who may not for some reason be covered by an agreement the roster determined by someone high up the chain who undoubtedly is covered by the agreement will effectively apply to them, won't it?

PN6368

MR MAXWELL: Yes.

PN6369

DEPUTY PRESIDENT HAMILTON: And even if they are covered by enterprise agreements when they're renewed this award is the - - -

PN6370

MR MAXWELL: The boot test.

PN6371

DEPUTY PRESIDENT HAMILTON: - - - the boot test, so it has an influence of some sort, and you can debate what influence.

PN6372

MR MAXWELL: Your Honours and Commission they're the submissions we wish to make. We note that there are very limited reply submissions that have been filed in response to this aspect of our claim, and perhaps I should wait to hear what the employers have to say.

PN6373

VICE PRESIDENT HATCHER: Mr Schmitke, are you next? Mr Crawford, did you want to say anything?

PN6374

MR CRAWFORD: No, we support the claims, your Honour.

PN6375

VICE PRESIDENT HATCHER: Mr Schmitke.

PN6376

MR SCHMITKE: Thank you, your Honour. Your Honours and Commissioners, it comes as no surprise that Master Builders would urge the Commission to reject this application and not to grant the variations as sought by Mr Maxwell. There is a raft of issues that could be covered. I will leave that perhaps to my colleagues, but I would like to simply start by noting that the task before the Commission is to be sure that the relevant construction awards provide fair and relevant minimum safety net; not an average, not a medium, but the minimum. It's the safety net for the industry coverage in the absence of any other arrangement. This is an instrument that applies nationally. It's not an instrument that just applies in the north-west of WA. It's not just in Darwin or remote areas of Queensland, but it also applies across the board.

PN6377

What happens in this award becomes the baseline, and it becomes the baseline for the entire building and construction sector, and I think as the various parties have submitted to the Bench throughout this proceeding it's the baseline of a whole raft of other construction instruments. So what happens in this sector and this award becomes the norm.

PN6378

We need to have regard to the fact that this aspect of Mr Maxwell's claim applies to distant work, and distant work in 24.1(a) of the current On-Site Award is:

PN6379

It operates when an employee is employed on construction work at such a distance from the employee's usual place of residence or any separately maintained residence that the employee cannot reasonably return to that place each night.

PN6380

And that is the definition of distant work under this award. That is the definition that the CFMEU seek to retain to some extent with respect to its claim.

PN6381

So the point I seek to make to your Honours and Commissioners is this; this isn't just massive construction projects in remote areas. It could be a school being built in Wagga or not far from Wagga. It could be a project that's taking place in Bathurst. As long as it involves work where an employee would be unable to return home each night because it's unreasonable to do so then the particular provision would apply. We are seeing the doubling of allowances, we're seeing the losing of flexibility with respect to tighter rules regarding the provision of transport. We're seeing an extra day's paid leave, we are seeing the introduction, the proposed introduction of unpaid leave. We are creating circumstances where what happens in these major projects – this isn't Inpex, Inpex in Darwin or some of these massive projects in like Wheatstone, we're talking about potential small construction sites up in Bathurst, in Bendigo and those type of places.

PN6382

The claim seeks to include and impose upon all employers the requirements to provide things like Skype and mobile phone coverage. Now I am not necessarily certain how it is that a small construction company who is seeking to do some work away from the normal metropolitan area or their normal place of business has to be responsible for providing or ensuring that employees have got adequate mobile phone coverage. I am not sure why they have to ensure that where they're engaged in some sort of camp arrangement they have to have their own room that's quiet with air conditioning. I am ensure as to why those employers would have to cover the cost essentially of picking up the employee from home and covering their travelling time to a project, accommodating them, paying them additional money and then returning them back. This is supposed to be the baseline minimum, and I fail to see how it could possibly meet the modern award's objective.

PN6383

I looked closely to see if I could determine any claim advice that may well have perhaps better met the modern award objective, and I noticed that there was an attempt to include or the Commission is being asked to include requirements about making employees or employers unable to or preventing this alleged practice of – was it gate keeping or something like that – where essentially employees are required to provide a false address, or so it said, but the existing provision has at, I think it is clause 24.1(a)(iii) – no, sorry, 24.2(a) under "Employees address", it says:

PN6384

On engagement an employee must provide the employer with their address at the time of the application and the address of any separately maintained residence, and if requested reasonable documentary proof of those details.

PN6385

And I don't think that particular provision has remained in Mr Maxwell's clause. Instead he sought to reverse the onus as it were.

PN6386

VICE PRESIDENT HATCHER: Clause 24.1(b) then says if an employee makes a false statement they lose their entitlement.

PN6387

MR SCHMITKE: Yes, correct.

PN6388

VICE PRESIDENT HATCHER: Completely.

PN6389

MR SCHMITKE: Yes.

PN6390

VICE PRESIDENT HATCHER: So we have heard evidence which suggests that employees provide false addresses or encouraged to, to get work, and then if they raise that as an issue they then disqualify themselves from the payment. It's not something that any employee is really going to dispute.

PN6391

MR SCHMITKE: That may well be the case. I suppose the point I seek to make here is that almost all of it or reasonable parts of the existing provisions to some extent have been removed, and we are having a whole raft of additional things added in which we say the sector wouldn't necessarily be able to accommodate, it's not practical to accommodate and certainly wouldn't meet the modern award objectives.

PN6392

VICE PRESIDENT HATCHER: Would it be reasonable to require the employer to verify the address?

PN6393

MR SCHMITKE: Yes, because the existing provision asks or gives the employer the capacity to ask the employee for proof.

PN6394

VICE PRESIDENT HATCHER: But to require them to do that, that is - - -

PN6395

MR SCHMITKE: That would be reasonable, yes. I think the Commission obviously needs to have regard to the impact of what granting a claim like this might be. It was touched on just earlier this is essentially adopting the mining sector's minimum conditions for FIFO workers. Now the building construction sector is not FIFO, but it's adopting it and making it the baseline provision. I would simply make a couple of - - -

PN6396

VICE PRESIDENT HATCHER: Mr Schmitke, are you able to tell me in relation to a country area construction site where an allowance for meals and accommodation of less than $100 a day would be adequate to cover the actual expense incurred by employees for providing those, for providing those things for themselves?

PN6397

MR SCHMITKE: Well, I can take it on notice, but I think in relation to that point, your Honour, I would note that the award currently has in it a provision at clause 24.4(b) which provides for the adjustment of allowances.

PN6398

DEPUTY PRESIDENT HAMILTON: Clause 24.4 is messing system.

PN6399

MR SCHMITKE: Sorry, 20.4(b), which is on page 40 of the award, and that's adjustment of expense related allowances. You can see there we have in the allowance column meal allowance, living away from home, distant work and camping allowance, and there's an applicable CPI next to them. So the award already contains - - -

PN6400

VICE PRESIDENT HATCHER: Accepting all of that this allowance adjusted for CPI can you tell me where in any country town where construction is occurring that an employee could with $68.45 a day provide themselves with accommodation and three meals?

PN6401

MR SCHMITKE: Your Honour, that is a question I can't answer because - - -

PN6402

VICE PRESIDENT HATCHER: I am looking at clause 24.3.

PN6403

MR SCHMITKE: because I can't – I am unaware as to exactly where all construction is taking place, but the point you make is accepted.

PN6404

VICE PRESIDENT HATCHER: The example you gave in Bathurst can you tell me a place in Bathurst where an employee could obtain accommodation and three meals a day for $68.45.

PN6405

MR SCHMITKE: In Bathurst? I actually almost could, your Honour, but the point is not lost. Now I understand the point that you're making here and I am not necessarily saying that there isn't some adjustment to be made, that's certainly not what I am saying.

PN6406

VICE PRESIDENT HATCHER: One solution might be to require an employer to provide reasonable accommodation, full stop.

PN6407

MR SCHMITKE: That might be one solution, however - - -

PN6408

VICE PRESIDENT HATCHER: Or reimbursement, require reimbursement of reasonable expenses.

PN6409

MR SCHMITKE: There are a number of different ways to accommodate the issue that Mr Maxwell complains of, yes.

PN6410

DEPUTY PRESIDENT HAMILTON: Would you have difficulty with those approaches?

PN6411

MR SCHMITKE: I think that's – Master Builders would need to consider those, but what I would say though is there is a large – and all the witness evidence here was about the coverage of the enterprise agreements, everyone was covered by an EBA, and I think the other parties, the other witnesses have all indicated that this type of work is all covered by enterprise agreements.

PN6412

VICE PRESIDENT HATCHER: I think you're shifting ground there. You point out correctly that most of the evidence was concerned with remote mining construction, and you said against that there's smaller scale construction in less remote places. That work which wasn't covered in the evidence may not be agreement covered. Is that possible?

PN6413

MR SCHMITKE: It may not be, that's the case, but from a practical sense, your Honours and Commissioners, I can say that just like when we hear evidence to say you've got to follow work or I'm worried about the downwards pressure on my wages, it's not often the case that we come across an unemployed carpenter or electrician in this sector. It's not the case that they have to follow work and be paid the award wages. I recall a statistic and I will provide it to the Commission as soon as I can about the average wages in the construction industry on a construction site. It's $106,000 a year.

PN6414

VICE PRESIDENT HATCHER: Is that true of Adelaide and Perth as well as Sydney and Melbourne?

PN6415

MR SCHMITKE: I am sorry?

PN6416

VICE PRESIDENT HATCHER: Is that true of Adelaide and Perth as well as Sydney and Melbourne?

PN6417

MR SCHMITKE: It's not too far off is my point. It's not a sector at the moment where if you're engaged with a trade that you are struggling, and in fact a lot of the witnesses in this matter gave evidence to that effect. There were a number of them that said that they were part of a FIFO community. A number of them said, well you've got to go where the work is. I think it might have been Mr Reilly said – I put it to him that he doesn't have to take these jobs, he could stay where he is and go and pursue another occupation and he said, "No. I really like being in this trade and I will go wherever I need to go to get work." In fact after he finished work on the Sapphire Woolgoolga Road he liked it so much he moved his family to Woolgoolga. So there's obviously a lot of people in this sector who do derive a large benefit from working under these type of conditions, and that's fine, that's absolutely fine. That is not our complaint. Our complaint is that this is an instrument that's supposed to be part of a fair and relevant minimum safety net, and we would say that it's not. We would say that it's not.

PN6418

Very quickly with respect to the other parts of the evidence, everybody tended to agree that where they were working there was already another project agreement in place, and of course as was anticipated by the Bench that causes a great problem; a great problem for our members, because it requires our members and the building construction sector to be setting the baseline bar for all large construction projects and accommodation facilities.

PN6419

These people don't have to follow and don't have to necessarily take this other work on, but they choose to do it, they chased it, and it's not necessarily the case that all of the sort of problems that have been alleged by these witnesses actually are commonplace. Mr Reilly seemed to be happy as Larry to be frank in terms of his employment.

PN6420

So essentially there is no basis that I can see how this would in any way improve this award in terms of it meeting the modern award objectives. I don't in fact think that any of the claims made would improve any of them at all, or meet any of them. That is not to say - - -

PN6421

VICE PRESIDENT HATCHER: Did you think the witness evidence and the claims made are credible?

PN6422

MR SCHMITKE: Certainly not.

PN6423

VICE PRESIDENT HATCHER: Why not?

PN6424

MR SCHMITKE: Well, I should say that Master Builders tried to take a sensible approach of the evidence here, because we were interested to hear and facilitate the Commission hearing the information behind this claim. There's lots of commonality between some of the witnesses, lots of commonality. Lots of witnesses blamed everything on FIFO work. It doesn't matter if it was taking drugs, it was fighting, it was their spouse leaving, blah, blah, blah. Now I am not saying they're not serious things, these are serious things, but I am not certain why this award needs to be adjusted to address those types of problems. So we would say that there's a great deal of concern with the credibility of some of those witnesses. There's a commonality, and of course again two or three of them have been in front of this Commission before, two or three of them have been in front of Federal Courts before, and two or three of them have probably been bound to have broken the law with respect to the Workplace Relations Act and the Fair Work Act, but again they're things that we didn't necessarily pursue.

PN6425

MR MAXWELL: I object.

PN6426

VICE PRESIDENT HATCHER: Did you raise that with - - -

PN6427

MR SCHMITKE: No, I didn't, your Honour.

PN6428

VICE PRESIDENT HATCHER: Why are you raising it now for?

PN6429

MR SCHMITKE: Because we sought to take a sensible approach here. We wanted to assist - - -

PN6430

VICE PRESIDENT HATCHER: Perhaps you should keep taking a sensible approach. If these are important issues, you should have raised them with the witnesses.

PN6431

MR SCHMITKE: I chose not to. So, your Honours and Commissioners, I am sure that the rest of my colleagues will fill up the gaps that I have left, needless to say of course we are not of one size fits all sector. Yes, there are large building construction companies, but there's a lot of small building construction companies. There's a lot of electrical contractors, there's a lot of civil contractors, there's a lot of residential contractors. There's a lot of people in this sector, all of whom – a lot of plumbing companies, and they're not big companies, but they are all going to have to potentially be covered by this particular provision, and it's already in a document which is unwieldy, it's already in a document which we say is inflexible, it's rigid, and this will not assist, in fact it will protract. If it pleases the Commission.

PN6432

VICE PRESIDENT HATCHER: Any other employer submissions; Ms Paul?

PN6433

MS PAUL: Yes, your Honour. Your Honour, if I can just take you to firstly – you don't need to read it, but the Building Construction On-Site Award as well as the Joinery Trades Award. In the section 24.5 of the Joinery and Building Trades Award subsection (ii) deals with the payment of the allowance and the quantum of the allowance, but it also adds at the end of that first dot point:

PN6434

If the employee satisfies the employer that a greater outlay than prescribed was reasonably incurred reimbursement for the expenses outlaid or reasonable - - -

PN6435

And a similar type - - -

PN6436

VICE PRESIDENT HATCHER: Just slow down, Ms Paul, was it 24.5?

PN6437

MS PAUL: Section 24.5(ii) of the Joinery and Building Trades Award.

PN6438

VICE PRESIDENT HATCHER: And there's a similar provision in the second sentence at 24.3(a)(i) of the On-Site Award.

PN6439

MS PAUL: Yes, your Honour.

PN6440

DEPUTY PRESIDENT HAMILTON: So 24.5, what sub-paragraph or sub sub-paragraph?

PN6441

MS PAUL: It's 24.5(ii), the first dot point, your Honour, in terms of the Joinery and Building Trades Award, and the Building and Construction On-Site Award has a similar section in 24.3(i):

PN6442

Similarly allowance may be increased if the employee satisfies the employer that the employee reasonably incurred a greater outlay than that prescribed.

PN6443

That's in response to the CFMEU's proposition to the Bench that where would you find someone being able to go and find a home - find allowance of food, et cetera, as well as accommodation.

PN6444

DEPUTY PRESIDENT GOSTENCNIK: Ms Paul, can I just say this; the proviso – there's no obligation there to increase the allowance even if the employee so satisfies.

PN6445

MS PAUL: And I don't disagree with that, your Honour, in terms of the building - - -

PN6446

DEPUTY PRESIDENT GOSTENCNIK: Does that mean you agree with that?

PN6447

MS PAUL: No. To finish that, your Honour, I think it allows for an employee to raise a dispute about the unreasonableness of the employer's position if we are talking about the Building and Construction On-Site Award, but if you look at the Joinery Building Trades Award, your Honour, it actually says:

PN6448

Or if the employee satisfies the employer that a greater outlay than that prescribed was reasonably incurred.

PN6449

The test is reasonably incurred. One would assume that there should be a payment accordingly, or certainly - - -

PN6450

DEPUTY PRESIDENT GOSTENCNIK: In the On-Site Award should we read "may" as "must"?

PN6451

MS PAUL: Your Honour, we don't see that as an objectionable amendment to make, but that's not what the union is seeking.

PN6452

DEPUTY PRESIDENT GOSTENCNIK: No.

PN6453

MS PAUL: What the union is seeking to increase the rate to such a substantial amount in terms of the allowance that it far outstrips the best rate it is getting for a living away from home allowance under an enterprise agreement in a remote area. So the evidence of Mr O'Grady was that they're getting – the high end at best was $750 and that's agreements that they haven't negotiated since 2015, and I believe that was - - -

PN6454

VICE PRESIDENT HATCHER: If the clause was redrafted to say the employee gets $68.45 per day or such additional expenses as are reasonably incurred, whichever is the greater, would there be any reasonable objection to that?

PN6455

MS PAUL: I couldn't put an argument for an objection, your Honour, in relation to that, but, your Honour, I do put an objection to the basis of the union's claim for $913. I won't go through each of the evidence aspect, but the $913.88 is not achieved anywhere, and that is from the union's evidence in terms of under cross-examination.

PN6456

So Mr O'Grady is a fairly senior national member of the CFMEU, he's got a pretty good idea of the agreements he's got. He's saying the maximum they get on a remote site is $750, and they have all accepted the fact as well – talking about Mr O'Grady, Callaghan, Mr Woodward, Mr Cummins – that you actually do get a number of CFMEU agreements that have the allowance as well as the rest and recreation referring back to the award. Now these are agreements that were made after the 2013 report that CFMEU refers to in WA around the hardships and the costs, et cetera.

PN6457

So even on that basis the union has not been able to push this as a claim in the industry and has not achieved it, or have not sought it in some instances I guess in terms of the smaller employers; they certainly haven't achieved it, and we're talking about remote areas where you would be expecting if there was to be a high rate that would be where it would sit, but in terms as Mr Schmitke said this is an award that covers every building construction work, and distant work can mean as the words in both of the Joinery and Building Trades Award as well as the Building and Construction it's where they can't return home for a night.

PN6458

I think there was some questions asked by Mr Schmitke of Mr Woodward about Margaret River in WA which is a three hour trip down and a three trip back. He considered that remote work for that purpose. At the very least one would say that would be distant work. One can hardly argue that that sort of distant work down to Margaret River should incur a fee of $913.88 per week if there was a week's worth of work in there in light of the fact that the amount itself is not justifiable in terms of the union's claim, and that is the basis of the argument we have against the LAFHA allowance, your Honour, is that it is just not – there is no evidence to support it.

PN6459

There are lots of statements around how it would be better, and I understand the CFMEU's position of doing the appendixes and what you would pay to go to a particular location. We say that's rectifiable in terms of the second limb in both of the awards for example that allow for allowances to be paid greater than what's stipulated in the award, but the allowance is only one aspect, your Honour. The second aspect of their claim has been the rest and recreation clause which is around this four weeks on and one week off concept – sorry, three weeks on, one week off concept.

PN6460

Again the evidence of Mr O'Grady – I think Mr Sharp from the AWU – is that the best that the unions are getting – in general the unions are getting in enterprise agreements again on remote sites where there's FIFO and DIDO work a four week on and one week off roster, and these are agreements that have been negotiated by the union and a number of agreements since 2015.

PN6461

Again, your Honour, there was also an acceptance by the same witnesses that there were also agreements that their unions, respectively AWU and CFMEU, have negotiated that provided for the current award terms regarding rest and recreation, albeit they did get higher allowances in those agreements.

PN6462

To now bring a claim to change the award terms so drastically as to create rest and recreation clauses of a three weeks on and one week off seems to fly at the face of the award modernisation principle of creating an adequate safety net, and in fact all the unions - - -

PN6463

VICE PRESIDENT HATCHER: Ms Paul, in relation to the seven days off, let's assume it's still a four and one roster, what do you say to the proposition that seven days should be exclusive of travel to and from the site?

PN6464

MS PAUL: The seven days at the moment, your Honour, in the enterprise agreements the unions have negotiated do not separate the travelling component. So I can't see how they're running an argument that for an adequate safety net for an award you need to separate the travelling component from it either. I don't know - - -

PN6465

VICE PRESIDENT HATCHER: I think realistically that's why they are here, they haven't been able to get it in the field and they're trying to get it here.

PN6466

MS PAUL: Your Honour, I am not wanting to put evidence from the Bar table but it is the CFMEU and I can't imagine how they're actually expecting that if they can't get this in the field as such it would be unreasonable to be expecting employers who are covered under an award to be able to provide those sorts of rostering or those sorts of arrangements, and again I stress the evidence that they put is purely about those employers that own remote areas.

PN6467

So they are purporting to put such an onerous provision into the award, both LAFHA as well as the rest and recreation that they cannot themselves achieve. It makes little sense, your Honour, and it definitely does not mean that we are creating an award term that meets an adequate safety net, because there is no evidence that they have put forward – I accept that there's some evidence in terms of the allowance of $478 and $68.45, but as I said that's rectifiable by the concept of the allowance may be increased, and your Honour has come up with a separate proposition in relation to that, but certainly from the rest and recreation there isn't any evidence that they have put forward that this impacts – there's a problem anywhere in relation to this. The problems that they have talked about are problems that occur on remote sites, but all of those remote sites have all been covered by enterprise agreements, and then the enterprise agreements they have in the main don't provide for it, and this isn't something new, it's an enterprise agreement they're currently negotiating.

PN6468

So we say, your Honour, certainly the LAFHA clause and the allowance as well as the rest and rec clause has no probative evidence that they have provided in relation to the claim that they make of inserting those provisions into the award.

PN6469

In terms of motelling, your Honour, I have looked at the evidence of Mr Sharp. There certainly is lots of general evidence that has been put forward by the witnesses in this matter, but one could argue that they weren't specific, they lacked detail, and in cross-examination, Mr Sharp is a good example of one, where he provided some evidence around motelling, yet surprisingly when asked none of his members experienced motelling, and he got his evidence from his members and the members he spoke to. So one questions the voracity of the motelling and the real disability that's found as they are claiming in relation to motelling.

PN6470

Then there would be issues around the difficulties, and not wanting to play down the difficulties individuals experience whilst they're in camps or whilst they're in FIFO I do want to say that those difficulties rest solely, and the evidence only shows that those difficulties are in relation to FIFO or DIDO workers, but again that evidence is fairly general. There was a lack of specificity around specific examples, et cetera.

PN6471

So we say that again the provisions around that or the difficulties which give rise to the claim for the rest and recreation clause isn't made out, and certainly not for an adequate safety net for an award where the raft of employers under this award who are likely to pay in accordance with this award actually aren't going to be employing FIFO or DIDO workers, and in fact other than one example I believe where an individual said he worked for a labour hire company on a major project all of the evidence demonstrated that the employers actually pay in accordance with enterprise agreements.

PN6472

The issue about the false address being provided, and, your Honour, it's probably the one that we have – we object to all of the claims, but we probably object the least to that, because we believe that that's able to be rectified and not necessarily one that requires the clauses put forward by the CFMEU. It would make more sense, your Honour, and in fact the clause actually requires that there is if requested reasonable documentary proof of these details, and as your Honour has suggested if that was mandated we would certainly have no objection to that.

PN6473

Your Honour, there was one evidence, one witness statement that was put forward by a Mr Kirner and this is the only evidence that has been put forward in relation to the Joinery Award. The evidence of Mr Kirner merely demonstrates that he's aware of members of his that were employed by O'Brien Glass who do primarily domestic work, but who do travel, and travel from South Australia to New South Wales, and some of that work lasts for about four weeks. He then also provides some other evidence about discussions with members employed by Wunda Projects and he is aware that there are currently employees who travel again from South Australia to Queensland to do refurbishment upgrade works in Jupiter Casino, and he's aware that they are there for a period of six months.

PN6474

In light of those type of employees the claim the union is bringing is actually the same or similar claim as they are bringing for the Building and Construction Award, a payment of $913.88 per week as well as a rest and recreation clause on the basis of the four weeks on, one week off, and all of the examples and evidence support for rest and recreation for example is about issues of long term FIFO/DIDO workers. There is no evidence to suggest that a person that's away for six weeks or four weeks is suffering any of those issues that were raised by the witnesses in this matter.

PN6475

Going back to the issue around the false address and claims being put in, it appears from Mr Kelly's evidence, your Honour, that certainly in terms of false addresses he has certainly pursued claims he has indicated as well as where there has been – as he put it he is able to successfully pursue companies on a number of these issues and able to seek to have matters resolved internally or externally, and he has negotiated – he also admitted he negotiated agreements utilising the LAFHA clause in the award.

PN6476

So one assumes therefore that using the award terms there is an ability to rectify where employers are actually not paying or not requiring or where there's falsification, et cetera, there's a mechanism to be able to seek redress in relation to that. None of the other - - -

PN6477

VICE PRESIDENT HATCHER: In light of clause 24.1(b) I am not so sure about that, that is any employee who discloses that they gave a false address loses entitlements. Although I am sure that in some cases these issues can be resolved the award actually disincentivises anybody raising this issue.

PN6478

MS PAUL: Not necessarily, your Honour. All it says is that that's where the employee is actually making the false statements so the employee bears the responsibility, but where the employee is actually being forced to or persuaded or whatever other words have been utilised by the witnesses there would certainly be - - -

PN6479

VICE PRESIDENT HATCHER: They still knowingly made a false statement.

PN6480

MS PAUL: The employer would be able to bring a claim.

PN6481

VICE PRESIDENT HATCHER: They still must have knowingly made a false statement.

PN6482

MS PAUL: Yes, your Honour, but at the point of being requested to do that the employer becomes complicit in that behaviour.

PN6483

VICE PRESIDENT HATCHER: Yes. All right.

PN6484

MS PAUL: Now I believe the question was asked, your Honour, in terms of the evidence about employers paying – employees, sorry, paying their own way, and I understand Mr Kelly provided some such paying their own way in relation to accommodation and expenses relating to accommodation and meals, and my understanding, your Honour, is that Mr Kelly's evidence really only provides – he provided some evidence in relation to 11, 12 and 15, but mainly around the adequacy of the meal claims, and I understand that Mr Pallot made a fairly broad statement, again with very little evidence. So again it comes back to our argument, your Honour, that there is little to no evidence to support the union's claim.

PN6485

I do want to address one other issue. There was an online petition, your Honour, at paragraph 145 of the CFMEU claim. We say no weight should be given to that. We just simply say there's no weight that should be provided to it, along with the fact that we also say there should be no weight provided to the attachments to Mr Kelly's evidence. They were statements made which we were unable to verify any detail, and to be honest they contained very little detail in itself.

PN6486

So, your Honour, if there is no further questions we just end on the basis that we believe that the CFMEU just simply has not made out its claim.

PN6487

VICE PRESIDENT HATCHER: Thank you. Is there any employer who wants to say anything about this that hasn't already been said. Are we in a position to finish the matter by 1.15, I would have thought that we are, the whole matter.

PN6488

MR SCHMITKE: Your Honour, I have one very minor matter which I will be very quick with.

PN6489

VICE PRESIDENT HATCHER: Mr Maxwell, very briefly in reply?

PN6490

MR MAXWELL: Very brief.

PN6491

VICE PRESIDENT HATCHER: I am taking that as a yes.

PN6492

MR MAXWELL: Very briefly in reply, your Honour. In regards to the replies made by Mr Schmitke today the issue is under the clause, under the existing clause is that it is the employer who decides on what options are provided. I suppose we would not oppose a clause that removes the allowances and just said the employer would provide accommodation and all meals.

PN6493

VICE PRESIDENT HATCHER: It has been known that there is some people who will have a friend, a relative to stay with for no cost and would prefer just a cash payment. In fact I've heard Public Service people live in those sort of arrangements.

PN6494

MR MAXWELL: Your Honour, some Public Service people may, and we accept that there may be some people in construction that would seek to avail of those arrangements, but our main concern is they are forced onto those arrangements where the employer says I will only pay you the allowance.

PN6495

In regards to the suggestion by Mr Schmitke that we are seeking an extra day's paid leave we are not. The existing paid leave for R&R already exists within the award, and that is found in paragraph 24.7(f)(i). Sorry, your Honour, it's in (ii) you will see that - - -

PN6496

VICE PRESIDENT HATCHER: Additional two days.

PN6497

MR MAXWELL: Two days paid leave and then after a further month they're entitled to two days but only one day is paid. So we are not seeking any additional paid leave on R&R than exist in the award.

PN6498

In regard to Mr Schmitke's comments about mobile phone coverage we will point out that in the existing 24.3(b) that there is a requirement that accommodation includes radio or telecom contact. So all we are seeking there is to update the modern methods of communication.

PN6499

Mr Schmitke made the outrageous comment or claim that the average earnings in construction workers is $160,000 a year. I point out that I know where he got that information from, it's from an MBA Commission research that they use to support the reintroduction of the ABCC. There is material that we have provided that debunks the claims found in that report, but given that the information is not before the Commission I won't take it any further than that, but we can provide it if necessary.

PN6500

Mr Schmitke also seemed to complain that what we are seeking is require for employees to be paid travelling time to and from the projects. Those provisions already exist under the award, or it provides that the travelling time for up to eight hours per day is paid under the award of distant work.

PN6501

In regard to the AiG I am not sure whether Ms Paul has been down to Margaret River lately, but I can assure you I doubt if you will find accommodation down there for $64 a day. In regard to this whole issue about the relevance of people covered by enterprise agreements that was one issue that was addressed in the penalty rates case, and I refer the Bench to paragraph 1235 of that decision where the Full Bench in that matter recognised in (iii) that the Fair Work Act, in particular the modern awards objective does not exclude consideration of the circumstances of employees whose terms and conditions of employment are set by enterprise agreements. So we say that it can be a relevant consideration in regard to these proceedings.

PN6502

Ms Paul also said that we were unable to achieve greater than seven days at home in our enterprise agreements. I point out that the evidence of Mr Woodward in regard to the dispute on Barrow Island where they achieve the 23/10 roster which provided for 10 days R&R, and also the evidence of Mr Callaghan at paragraph 5 where he refers to a 26/9 roster that he worked on.

PN6503

They are the submissions I make in response to the replies that have been given today.

PN6504

VICE PRESIDENT HATCHER: Thank you. Mr Schmitke, you have variation about this.

PN6505

MR SCHMITKE: Yes, just in relation to living away from home, distant work travelling expenses. Daily fares allowance, that's in our submission of 12 December at item 11 – sorry, 2 December, item 11 on page 17. That particular provision is – or the variation that we seek is to address what we say is an error with the existing provision. The current clause, 24.7(d), seeks to provide an exclusion of the fares and travel pattern allowances, so clause 25. That particular exception is in relation to where people are required to work either – sorry, where they're required to reside elsewhere onsite or elsewhere other than adjacent to the site and provided the transport.

PN6506

The word "and" we say doesn't make sense. It's illogical that a fares and travel allowance should be payable to an employee when they're required to reside adjacent to their place of work simply because they're not provided transport. Adjacent obviously has the meaning next to or adjoining. So applied in this context you have a worker residing next door to a construction site where they're working and they would still get the allowance. So we would seek it to be amended so that it would read, "Onsite or adjacent to the site or provided with transport" to make that clear.

PN6507

VICE PRESIDENT HATCHER: Thank you. Mr Maxwell.

PN6508

MR MAXWELL: Your Honour, we object to that variation. The clause is a long standing clause of this award and it has always been the intention that unless they are accommodated onsite, and onsite normally means the camp is on the construction site, that where it is adjacent to the site adjacent could be any distance from – depending on a remote project it could be 5 kilometres, 10 kilometres, but still considered to be adjacent to the site, and we submit that the allowance should still be payable.

PN6509

VICE PRESIDENT HATCHER: Thank you. Was there a CCF variation about this, Mr Boanza?

PN6510

MR BOANZA: No, thank you, your Honour. Our submission was only in relation to breaking down the allowance. I believe the CFMEU in their cross-examination have done that anyway and we have nothing further to add.

PN6511

VICE PRESIDENT HATCHER: Does that leave us with the Plumbing Award issue then? Mr Eberhard?

PN6512

MR EBERHARD: Yes, your Honour.

PN6513

VICE PRESIDENT HATCHER: So is this not opposed, or the two changes not opposed?

PN6514

MR EBERHARD: Surprisingly in these proceedings I think that is the case, your Honour, yes.

PN6515

MR COFFEY: Not exactly, your Honour.

PN6516

VICE PRESIDENT HATCHER: Yes, all right.

PN6517

MR EBERHARD: In regards to clause 32, which is the penalty rates, all we seek to do is restructure the clause to what we suggest is to make it more user friendly. We don't seek to extend it any way or vary it in any other form other than just to revise it and to restructure it. We do nothing further than seek to vary the way the terms are provided with in the award. That's all we seek to do in regards to the penalty rates. In regards to clause 33 we seek the insertion of the words at the start of the provision that "each day's overtime would stand alone". Again we have dealt with both of those in our written submissions and I really don't intend to take the Commission any further with either of those two provisions.

PN6518

VICE PRESIDENT HATCHER: Thank you. Mr Coffey, were there submissions in opposition to these filed?

PN6519

MR COFFEY: Your Honour, the penalty rates clause that the Master Plumbers want to put in we are happy with that. It just explains it a bit simpler I think, and if that can be done that's good. Just the overtime, the each day's insertion, we are just a bit worried that it's a little bit light on information and I was just hoping that with Mr Eberhard's help we could just add a few words, agree on a few more words. I'm just worried that for example if you start overtime at 5 o'clock at night and work through until 3 o'clock in the morning some people might see that as two separate parts of overtime because you're going over two days.

PN6520

VICE PRESIDENT HATCHER: Mr Coffey, can I encourage you to have discussions with Mr Eberhard about that and if you agree upon the words then you can forward that to the Commission.

PN6521

MR COFFEY: Yes. Nothing further, thank you.

PN6522

MR EBERHARD: Thank you, your Honour.

PN6523

VICE PRESIDENT HATCHER: Have we dealt with all the issues? Yes, all right. We will now adjourn. On behalf of the Full Bench can I thank all the parties for their very extensive submissions. Obviously we try to make the task easy by asking a few questions, but notwithstanding that it was still a difficult task. We propose to reserve our decision and we will now adjourn.

ADJOURNED INDEFINITELY [1.09 PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #47 EXTRACT OF AUSTRALIAN WORKERS' UNION CONSTRUCTION-ON-SITE AND CIVIL ENGINEERING (A.C.T.) AWARD 1999 TENDERED BY MR CRAWFORD....................................................................................................... PN5944

EXHIBIT #48 EXTRACT FROM NATIONAL BUILDING AND CONSTRUCTION INDUSTRY AWARD 2000 TENDERED BY MR SCHMITKE.................. PN5947