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Fair Work Act 2009����������������������������������������������������




AM2014/196� AM2014/197


s.156 - 4 yearly review of modern awards


Four yearly review of modern awards


Part-time and Casual Common Issue




10.01 AM, FRIDAY, 2 FEBRUARY 2018


Continued from 1/02/2018



VICE PRESIDENT HATCHER:  Yes, I will take appearances.  Ms Rodgers, you appear for the AMIEU.


MS RODGERS:  I do.  Good morning, your Honour.


VICE PRESIDENT HATCHER:  And Mr Herbert, you appear for the Australian Meat Industry Council.


MR HERBERT:  Yes, I do.  Thank you, your Honour.


VICE PRESIDENT HATCHER:  Ms Rodgers, is there any reason why we shouldn't grant Mr Herbert permission to appear?


MS RODGERS:  No, your Honour.  Thank you.


VICE PRESIDENT HATCHER:  We will grant that permission, Mr Herbert.  There's some evidence we have to deal with.  Perhaps I will start with your side, Mr Herbert.  There is a statement from Mr McKell.




VICE PRESIDENT HATCHER:  He's not required for cross‑examination?


MR HERBERT:  We received notice at 8.30 this morning that he was.  That's the first we knew of it.


VICE PRESIDENT HATCHER:  Does that present any difficulty?


MR HERBERT:  It did.  It does, yes.  We're not too sure what's involved.  We've received no notice of what's to be - he was to be asked about.  We've not had an opportunity, therefore, to prepare anything in that regard.  And it does cause us some difficulties, your Honour.  I'm conscious of the fact we have limited time today and I don't want to drag out a debate about the matter, but we don't know yet whether we will be prejudiced until we hear what it is that's being said.


Mr McKell fortunately is here anyway, but I've not been able to undertake the usual preparation one would do if one thought a witness was going to be cross-examined.


VICE PRESIDENT HATCHER:  How long do you think you will be in cross-examination, Ms Rodgers?


MS RODGERS:  Your Honour, we have merely five questions for Mr McKell, and they're simply contained within his statement.  We wouldn't necessarily see that that would pose list of McKell any difficulties.


VICE PRESIDENT HATCHER:  All right.  Perhaps we will do it this way since both witnesses are required to cross-examination.  I will treat the AMIEU as in effect the moving party since it's answering a positive proposal in respect of casual conversion.  We will deal with Mr Smith's evidence first.


MR HERBERT:  I don't require Mr Smith for cross‑examination, but I understand that the union propose to call him to give some new evidence.  We don't know what that is either.  Unless he says something in his new evidence that causes me some difficulties - and I can't comment until I hear it - we don't require him to be cross-examined, and we haven't indicated positively that we would at any point in the proceedings.


VICE PRESIDENT HATCHER:  Ms Rodgers, what's the additional evidence you want to adduce from Mr Smith in broad terms?


MS RODGERS:  Your Honour, we didn't propose to call any new evidence.  We had proposed to put to Mr Smith on the stand a number of matters about Mr McKell's statement which the union didn't agree with, so quite confined examination; and further, three metres pertaining to these recent submissions that the AMIC have provided on Wednesday.  Those questions would have been limited to three broad topics with a number of minor questions in relation to those.


VICE PRESIDENT HATCHER:  Let's get Mr Smith in the witness box and we will see where we go.


THE ASSOCIATE:  Please state your full name and address.


MR SMITH:  Graham Richard Smith, (address supplied).

<GRAHAM RICHARD SMITH, SWORN��������������������������������������� [10.05 AM]

EXAMINATION-IN-CHIEF BY MS RODGERS��������������������������� [10.05 AM]

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


MS RODGERS:  Thank you, Mr Smith.  Have you prepared a witness statement in these proceedings signed by yourself and dated 2 August 2017?‑‑‑Yes.


Have you provided a second statement in these proceedings dated 22 December 2017?‑‑‑Yes.


Are the facts and circumstances set out in that statement, to the best of your knowledge and belief, correct?‑‑‑Yes.


Your Honour, we seek to tender those two statements.


VICE PRESIDENT HATCHER:  Just give me a second.  The statement of Graham Smith dated 2 August 2017 will be marked exhibit MIA1; and the further statement of Graham Smith dated 22 December 2017 will be marked exhibit MIA2.




MS RODGERS:  Mr Smith, have you seen a copy of this unsworn statement of - an unsigned statement of Ken McKell dated 22 December 2017?‑‑‑Yes.


Do you have a copy of that in front of you?‑‑‑No.  I thought I did, but I don't, I'm sorry.


Mr Smith, if I could please have you turn to paragraph 11(iii)?‑‑‑Yes.


Do you agree with Mr McKell that the award coverage of meat processing establishments includes the workers that are described there?‑‑‑What paragraph was that?


It's 11(iii)?‑‑‑Yes, it can do.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


Thank you.  So meat processing establishments encompass employees in packing, distribution, transport, clerical, admin, all of those categories that are described there?‑‑‑It can do.  The practice is not necessarily what occurs there.  I mean, for instance, the clerical and administration people that would be employed in the head office wouldn't generally be under the award, they would be under the Clerks Award.  But our award is capable of covering them.


And maintenance tradespeople, are they covered by - - -?‑‑‑No, tradespeople - the maintenance are covered by a separate report.


Thank you.  And if you go down to (iv), the example provided there is the clerical and admin employees, and Mr McKell says that they are completely separate.  Would you agree?‑‑‑No.  See, there are a couple of areas - there are a number of areas where that classification would occur.  I mean, there would be some that occurred within the factory, testing and things like that which would be a clerical or administrative function; but by and large the clerical and administrative functions are, like I say, in the head office, that's the payroll people and all that sort of thing, and they would be covered by different award.


VICE PRESIDENT HATCHER:  What about transport and storage functions?‑‑‑Similar sort of thing.  The transport, it depends whether they're directly employed by the company or whether they're employed by an external provider.  Most of them are contractors on an external provider basis, so they would be covered by our award.


To the extent you ever have any employees that aren't hands-on meat people and they're covered by this award in meat processing, would daily hire ever be used for them?‑‑‑For which people, sir?


Anybody at a meat processing establishment who is not actually hands-on dealing with meat.  Like, if you do have any clerical employee or any storage employee who is in a meat processing establishment, would they ever be on daily hire?‑‑‑Again it would depend on where they are.  Generally speaking the meat factory operates from the point in time where stock bring animals into the lairages, which is the holding pens before they go to the slaughter floor, and from that point to the end of the production where they're packed into boxes and ready to go onto trucks, all of those people are part of the production process, and generally all of those people would be on daily hire.  So it wouldn't be, like, this part on daily hire and that part on a different form of hire.


MS RODGERS:  Can clerical and administrative work continue if there are certain other sections of the site that an operating was she might for example, if the kill floor is not operating?‑‑‑Clerical:  again if we're talking about the people in the main office, the payroll clerks, receptionists for the meat works and that sort of thing, yes, they would continue on operating.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


Could rendering work continue if certain sections aren't operating?‑‑‑Yes.  The rendering plant draws its material from all across the plant, so as long as one section is working, the rendering plant will continue to work.  So if the slaughter floor, for instance, was stood down, product would still go from the boning room to the rendering plant, bones and that sort of thing.  If the whole plant - if both the slaughter floor and the boning room sections had both stopped for a period of time, probably a day or two or more, then the rendering plant would eventually run out of product and would stop.


Mr Smith, are there any states or territories within Australia that don't regular use daily hire?‑‑‑Yes.  Western Australia has only been, sort of relative terms, recently become a respondent to the federal award system, and so prior to that daily hire wasn't really a feature in Western Australia, it wasn't in their state award.  Tasmania I think was the same.  They dealt with it in different ways, but I don't think it was a feature of their award and so they don't really call them daily hire in Western Australia or Tasmania.


VICE PRESIDENT HATCHER:  So how do they structure their employment?‑‑‑They strike enterprise agreements where they boost up the base wage and then put in a general stand down provision that says that if they don't want to buy stock or if there's some seasonal factor or whatever and the company decides not to operate on the day, then they can stand the plant down the date.  So it's the same thing, they just don't call it daily hire.


MS RODGERS:  If I can take you to paragraph 7 of Mr McKell's statement?‑‑‑Yes.


So you're at paragraph 17 - sorry, my apologies?‑‑‑Yes.


Sorry, my apologies.  Here Mr McKell says:


Daily hire is utilised to effectively manage the processing workforce in processing establishments and is used very sparingly for non-processing operations in processing establishments.


Is it common in the industry to distinguish in that way between processing and non-processing employees on a site?‑‑‑No.  I'm actually not really certain what the point of that is.  I mean, everyone from the point in time where they start pushing them up the lairages to that point in time that we put them in the boxes is all involved in processing.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


Thank you.  If you come down to paragraph 18?‑‑‑Yes.


Mr McKell there is talking about the proposed wording in the AMIEU first draft "predominantly daily hire".  Do you see a difficulty with using those words, "predominantly daily hire"?‑‑‑No.  It's a concept that we already had in the award.  The award covers three different types of the industry; there's the processing part, there's the retail and wholesale, and there's the manufacturing part.  And if you have a look in the definitions at clause 3 of the award, that same wording is used to distinguish the operation of the award in relation to those parts; so it will be wholly or predominantly meat processing or wholly and predominantly meat manufacturing.  So I can't see why we wouldn't be able to use it in this particular context.


Thank you.  When the AMIEU drafted its first clause were all of those employees considered?‑‑‑Yes, that's actually what let us to use those words in our original draft submission.  We were trying to have continuity with what was already contained within the award.


If I take you to paragraph 21 of Mr McKell's statement.




MS RODGERS:  21?‑‑‑Yes.


Mr McKell is talking there about the union being the party bound by many agreements, and in the third sentence he says:


In other words, the agreements do not generally cover the classifications referred to in (his earlier paragraph) and these people are generally subject to the award as a minimum safety net.


Would you say that he is correct in saying that generally packers and renderers and loaders aren't covered by our agreements?‑‑‑No.  No, the agreements that the union does usually - and that is in the vast majority of cases - cover as much of the processing operation as possible.  And that is, like I say, all of those people that I've already mentioned from the point in time that the trucks drop the livestock off for processing right through to the point in time when they get loaded onto trucks.  So our agreements generally cover all the way through all the classifications.


Mr Smith, can I take you to paragraph 24?‑‑‑Yes.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


Can I ask you what you make of that proposition there in Mr McKell's statement?‑‑‑Yes.  I must say I looked at this and I was a little confused by it because there is nothing inconsistent in what I'm saying about daily hire.  The normal operation of daily hire is that there are a number of factors where a plant chooses not to operate.  It's generally based on prices of livestock, and those prices of livestock are usually affected by seasonal factors, but I mean there are a whole range of circumstances where the plant might choose not to operate.  There may be a major power failure; there may be a stock supply problems; there may be a situation where a truck has overturned; there may be a situation where cattle that were destined for a particular market are trapped in a flooded field.  So I mean there are a range of factors that affect our ability to process, and all I'm saying is that that's what daily hire is there for, it's there to allow the company to choose not to work on any day that it doesn't want to.  And that includes the price of livestock, which is a general factor.  It's well known in our industry they have a range of budget and when they send their buyers the market to buy the stock if the stock ends up going beyond that - what they call the bust mark, they just choose not to buy them and they don't operate the next day.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Can I just ask, I'm not sure if you covered this in your evidence or not.  Are you aware of to what extent the part-time daily hire provisions are used?  Are they used at all?‑‑‑Not really.  I've not come across any.  Most of the plants operate on the basis of maximising their production in a day.  The only time where I've seen something similar to a part-time arrangement is at a plant called Kilcoy in Queensland.  It still really daily hire because they operate on no less than 7.6 hours a day ‑ ‑ ‑


I'm talking about daily hire versus part-time daily hire?‑‑‑Yes, and that's where I'm going.  At the Kilcoy plant they work 10-hour shifts and they will work for shifts and then three shifts, so over a fortnight they actually only do 70 hours, but they're all 10-hour shifts so there's no less than 7.6, so they're still a daily hire employee.  That's how all these plants were.  They don't really operate with part-time daily hire, there are no values in them.


VICE PRESIDENT HATCHER:  How are casuals used in those types of operations?‑‑‑Usually just top up tail end.  By and large we never used to see a lot of casuals where we had regular daily hire because there was no point.  We are seeing a lot more casual these days.  A lot of them are coming through as labour hire and so on, and then they will continue on as casuals if they move on to the books of the meat processor.  But they operate in exactly the same way.  They come on, they work the full day, and on days that they're not required, they don't work.  So daily hire and casual is actually very, very similar in its engagement.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


So why would employers use them as casuals rather than as daily hire?‑‑‑That's a question we've been asking ourselves.  I honestly don't know the answer to that.  The casual loading, you would have thought would have made it a disincentive, but there's this propensity at the moment to get all their labour through labour hire agencies and so we will end up with a massive amount of people actually employed externally by labour hire agencies, and then when they transfer across a still transfer across as casual for some period of time.  There are some instances where our own members have asked to stay casual for a period of time.  I mean, I've seen casuals in the industry for 20 or 30 years, but that was generally at their own request.


SENIOR DEPUTY PRESIDENT HAMBERGER:  There's a 10 per cent loading for daily hire?‑‑‑There is.


And/or your NES entitlements?‑‑‑And all the NES entitlements, that's right.


Except the managers, yes.  But all the leave provisions, you get annual leave, et cetera?‑‑‑Yes.


MS RODGERS:  In a meat processing establishment that uses daily hire and casuals, if there is less work available but the plant generally remains open, which employees are likely to be offered that remaining work?‑‑‑It's usually the daily hire employees that would get first pick of that work.  That's a situation, for instance, where they might not have enough stock to run the slaughter floor for that day but they're still processing the previous day's kill in the boning room, so the boning room will still operate.  That's about the only time that will happen.


My friends in their submissions have said, "Daily hire can be as insecure as casual employment."  Do you agree with that?‑‑‑I don't disagree with it.  It can be.  I mean, there's a whole range of factors that could prevent us from working, so yes, I guess so.  The big difference of course is that the daily hire employee at least has an ongoing contract of employment and he gets the NES entitlements.


VICE PRESIDENT HATCHER:  So in effect does the daily hire employee, if the plant shuts down for a period, knows that they will be employed when the plant reopens, in effect?‑‑‑Yes.


Unless there's an actual notice of termination given?‑‑‑Sorry, there was - - -


Unless there's an actual notice of termination given?‑‑‑Yes, unless they actually end up closing the plant.

***������� GRAHAM RICHARD SMITH��������������������������������������������������������������������������������������������������� XN MS RODGERS


MS RODGERS:  Thank you, Mr Smith.  Do you agree with the proposition that it is an objective of every plant to work every day of the week if they can?‑‑‑Yes, absolutely.


Do you agree also that circumstances can often prevent that objective being achieved?‑‑‑Yes.


Can you see any impost on an employer converting a worker from casual to daily hire or part-time daily hire?‑‑‑Absolutely none whatsoever.  They are in fact a similar proposition.  They're all employed by the day or shift, the difference is that the daily hire employee has an ongoing engagement.


Thank you very much.  I have no further questions.

CROSS-EXAMINATION BY MR HERBERT�������������������������������� [10.24 AM]


MR HERBERT:  Mr Smith, when you mentioned about in Western Australia that they've actually, under the state awards that previously existed before the modern meat award, a daily hire wasn't available but parties essentially worked out a way to achieve exactly the same thing and call it another name under their agreements.  Is that - - -?‑‑‑Yes, that's pretty much it, yes.


Now that it is available under the current award, then those sorts of agreements and devices would no longer be necessary if an entity wished just to operate on the award in Western Australia now - the award that applies in Western Australia now - they could use daily hire under the award?‑‑‑They could.


Without changing their operations much at all, from what you say, for the people who have been using a similar structure for some time?‑‑‑Well, most of those places that would use that are under enterprise agreements, so there would be some considerations; how they would restructure their industrial arrangements; but not the actual processing of the plant.


Not the processing of the plant.  So effectively daily hire, by one name or another, has been in use for a period of many years in all states?‑‑‑Yes.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


And it's showing no signs of going away out of the industry, it seems to have an enduring ability.  It's adopted as much now as it ever has been?‑‑‑Yes.  The industry is just too subject to fluctuation.  I mean, we're currently in a situation where we've had drought for a number of years, and when the drought breaks, of course, which is the circumstance now, the farmers have to rebuild the national herd, and so they withhold stock from marketplace, which means that we don't get to process as much, so we end up with a lot of stand-downs.


So those factors - - -?‑‑‑They're not going away.


- - - they're not going away?‑‑‑No.


You've mentioned about part-time daily hire is - you're not aware of circumstances under which it has been used?‑‑‑No.


But you've also said, in effect, that casual employment, in the way it operates, has pretty much the same attributes as daily hire in the way in which people work?‑‑‑In the way in which people work, yes, pretty much the same.


So that if an employer has use for an employee for, say, four hours a day, three days a week, then part-time daily hire is, as you say, not a very practical thing to do; but casual employment, on the other hand, is an available and practical way to achieve that outcome, isn't it?‑‑‑I can't see the difference, to be honest.


That's in fact how - you've said you don't see any reason why casual employment subsists in light of the availability of daily hire.  One of the reasons why casual employment subsists, I suggest to you, is because it is a useful way of achieving part days' work where part days' work is all that is required?‑‑‑Look, what we've got is we've got some very, very small processors around the country; you know, workforces of maybe 15, 20 people, and quite frequently they will work on the basis that you will have - and these are just service kill slaughtering plants, they don't usually have boning rooms - and they will generally work on the basis that all the slaughter men would be on a tally system, so they just get paid for the pieces that they do during the day, and then the labourers would be on a casual basis.  And they might work for, five, six hours in the day and finished then.  So there's that application.  But in the larger processors, or in all of the other processors, that wouldn't really be the case.  There's not really much call for only working for five hours in a day at a major plant.


VICE PRESIDENT HATCHER:  Can you engage somebody as daily hire on one day, then if for some reason you only need them for the few hours, hire them as part-time daily hire on the next day?‑‑‑No.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


What in the award stops you from doing that?‑‑‑To move them from one classification to the other would require seven days' notice.  And further to that, the union has some real problems with the concept that you can arbitrarily move people between classifications on a day by day basis.  It would mean that you can move someone from a permanent weekly hire employment situation to a part-time daily hire employment for a few days and then put them back on weekly hire again.


Leaving aside weekly hire; in terms of daily hire, whether it's full-time or part-time - I understand the objection to it, but I'm just trying to work out what in the award stops it?‑‑‑It's 11.4, this is where they could by agreement, I think it works.  I haven't got in front of me, but I think they can do it by agreement.  But other than that, otherwise it has to be on a seven-day notice basis to alter the classification.


Thank you.  Mr Smith, is there ‑ ‑ ‑


MR HERBERT:  With respect, your Honour, 11.4 doesn't apply to that circumstance.




MR HERBERT:  It only allows full‑time to daily hire, daily hire to full‑time; and similarly with part-time.  Part-time daily hire doesn't allow vacillating between, in effect, full‑time daily hire to part-time daily hire?‑‑‑Okay.  I will take your word for that.


DEPUTY PRESIDENT BULL:  Mr Smith, is there a general desire for casuals to move towards daily hire?‑‑‑Yes.


Are there people that would rather stay casual?‑‑‑Sorry, what was that?


Are there people that might want to stay casual as well?‑‑‑Yes.


Have you any idea what the proportion would be?‑‑‑The number of people that want to stay casual, in our experience, is relatively small.  They don't trust the meatworks operators and they want the cash in their hand every week to make sure that they don't get dudded out of their annual leave or whatever.  But the vast majority of people want to have that continuity of employment and where they're working.  I mean, some of these people I would say have been working there for years as casual, and a lot of those have told us that they would like to convert to some sort of permanency, whether it be daily hire in the meatworks or whether it be weekly hire.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


MR HERBERT:  Mr Smith, what I was suggesting to you is that casual employment is used both in the meat processing sector and in the meat manufacturing sector to soak up the ends of the production in which, in the case of processing, are not suitable for daily hire employees; and in the case of the meat manufacturing plants, are not suitable for the full‑time employees.  Isn't that right?‑‑‑No, I don't agree with that.


And that the position is then in the meat manufacturing sector, casual employees are used to deal with the volatility of supply issues that affect them in pretty much the same way that daily hire is used in the processing sector.  Isn't that right?‑‑‑No.  No, casual in the manufacturing area is massive.


It is massive?‑‑‑Massive, yes.


Yes, because in the manufacturing area they don't have access to daily hire, do they?‑‑‑That's right.


And with the volatility of supply and the requirements for labour, rather than use daily hire in that sector, they use casual employees to fill that same gap?‑‑‑No, I don't agree with that.  The experience that we've had is that the companies simply prefer to operate on a casual basis.


For that reason ‑ ‑ ‑ ?‑‑‑No.


 ‑ ‑ ‑ because they have a fluctuating demand for labour?‑‑‑No.  No, the manufacturing plants work year round.


With fluctuating supply issues similar to the ‑ ‑ ‑ ?‑‑‑Not that we've seen.


Beg your pardon?‑‑‑Not that we've seen.


I see.  Would - I will leave that?‑‑‑See, don't forget they've got a whole lot of stuff they can carry over from one day to another.  Just because there's a stop in one particular meatworks; I mean, there's 135 meatworks they can buy product from.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


And your point is?‑‑‑They can buy product all the time.  There is no time in Australia that I've ever seen where every single meatworks has stopped operating and stopped processing stuff that the manufacturers can buy.  On top of that, the manufacturers can work on carry-over.  They can put things that they put things that they haven't processed on one day into tubs, it goes into the chillers, and they can process it over the next day or two.  So even if there was no possibility of buying any product anywhere, they could still operate the next day.


A number of meat manufacturers also engage in slaughtering operations as an adjunct to their manufacturing.  That is so, isn't it?‑‑‑I couldn't tell you the number.  I haven't seen very many, but I don't disagree that there are some.


Yes.  They have the difficulties in acquiring livestock the same as meat processing establishments?‑‑‑Yes.  But again, those factories don't necessarily just rely on their own processing.


You mentioned before in relation to daily hire, I think in answer to a question from the Bench, that a daily hire employee has ongoing employment but they don't have an ongoing engagement in the sense that there is no obligation on the employer to provide them with work on any day?‑‑‑Yes.  I think it's the other way around, actually.  They've got an ongoing engagement, but they're not employed on any particular day.


As you wish, Mr Smith, but they're not required to be given work on any particular day?‑‑‑That's right.


And that can go on almost indefinitely, until such time as the employer terminates what you call the engagement?‑‑‑Yes.


Depending ‑ ‑ ‑ ?‑‑‑That could happen, yes.


And that would require - but in those circumstances if the plant were to suffer a downswing in the supply of stock, as you said is the situation that is happening at the moment, and the plant doesn't have enough stock to justify processing particular numbers, daily hire employees can be stood down and they have no particular expectation of any further work at all, even if the plant stays open.  Isn't that right?‑‑‑They have an expectation that if the plant reopens, they will be working.


But there's no compulsion for that to occur.  If the plant reopens they don't have to be recalled?‑‑‑Then they would be sacked, wouldn't they?


If the plant reopens they can be maintained as daily hire employees without being recalled to work?‑‑‑And if the plant continued to operate without employees ‑ ‑ ‑

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


No, but an individual employee, Mr Smith, who is of a daily hire status does not have a right to be recalled to work at any time, even if the plant has reopened after a period of closure?‑‑‑No, that's not right.  No, that's not right, they've got an ongoing engagement.  I mean, if you want to terminate that engagement then we're looking at a dismissal situation.


I'm talking about being recalled to work.  They don't have a right to be recalled to work.  Do you accept that?‑‑‑No, I don't.


VICE PRESIDENT HATCHER:  Is it possible that you might have a processing plant operating at full capacity, it shuts down for a while, and then it reopens but at limited capacity for a period which might not require the whole of the workforce?‑‑‑Yes, that's a circumstance.


And some might come back and some would still be at home?‑‑‑Yes, we would understand that.


MR HERBERT:  That could be an indefinite situation which could lead to, in effect, the employer subsequently, if it realises on long term it only needs half of the workforce that it has got, that those persons could be terminated without resuming work?‑‑‑Yes, I agree with that.


And that's a period that has no time limit on it?‑‑‑It used to.  It used to, and arguably still does.  It used to have a time limit of eight months in the award.


Eight months and you're deemed - there was a deeming provision that deemed you to be redundant if you had been - if the plant had been closed or the section had been closed for more than eight months?‑‑‑Yes.


So an employer could leave a permanent - a daily hire employee ‑ ‑ ‑ ?‑‑‑Just hanging in the wind, no.


 ‑ ‑ ‑ as you say, hanging in the wind, they're entitled to be treated as redundant after that period?‑‑‑Correct.


But leaving that situation to one side, a daily hire employee has no right to insist on being brought back in to work if a plant reopens in the circumstances described by his Honour?‑‑‑No.  Agreed.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


And a casual employee, similarly, if the plant closes their employment is, by dint of the closure of the plant and no further work, terminated?‑‑‑That's right.


So until they're subsequently engaged, they also have no right to return to work?‑‑‑Under that circumstance, yes.


Yes.  And the employer has to take no action in relation to those casual employees in those circumstances?‑‑‑No.


As they need to take no action in relation to the daily hire employees if they choose not to?‑‑‑Yes, I agree.


And if those persons are not working during that period, they don't accrue any leave entitlements due to them not having worked throughout that period that they're not working?‑‑‑They don't accrue leave entitlements, but they're still entitled sick leave - the public holidays.


Public holidays during a period in which they're not required to work?‑‑‑Yes.  So a daily hire employee, even if they were not working, they would still get paid the public holidays.


Thank you, your Honour.  I have nothing further.


VICE PRESIDENT HATCHER:  Any re-examination, Ms Rogers?


MS RODGERS:  No, thank you.  Nothing arises.


VICE PRESIDENT HATCHER:  Thank you for your evidence, Mr Smith.  You're excused.

<THE WITNESS WITHDREW��������������������������������������������������������� [10.38 AM]


VICE PRESIDENT HATCHER:  Mr Herbert, we will deal with Mr McKell now.

***������� GRAHAM RICHARD SMITH������������������������������������������������������������������������������������������������� XXN MR HERBERT


MR HERBERT:  We did ask him to wait outside while that evidence was being given in case there was some issue about it.  While we're waiting for Mr McKell do you want - the daily hire provisions in clause 14.1 of the award, and this is a matter of law as distinct from any matter of evidence - there is a - clause 14.1 allows an employer in a meat processing establishment to employ daily hire or part-time daily hire employees.  They are described differently and their entitlements to hours are different.


Now the issue has been raised, one would expect the contention would be that if one is engaged as a daily hire employee, that's what one is, and one doesn't morph from that to something else on a day to day basis.


VICE PRESIDENT HATCHER:  We might come back to that.


THE ASSOCIATE:  Please state your full name and address.


MR McKELL:  Ken John McKell, (address supplied).

<KEN JOHN MCKELL, SWORN���������������������������������������������������� [10.40 AM]

EXAMINATION-IN-CHIEF BY MR HERBERT��������������������������� [10.40 AM]


MR HERBERT:  Mr McKell, you've given your full name to the Commission as Ken John McKell.  Is that so?‑‑‑That's correct.


Have you prepared a witness statement which has been lodged with the Commission on 22 December 2012(sic)?‑‑‑Yes, I do, in front of me.


And it's dated 22 December on the first line.  Is that witness statement, to the best of your knowledge, true and correct?‑‑‑Yes, it is.


And the opinions you've expressed in that statement are your own opinions?‑‑‑Yes, they are.


To the extent that it's necessary, I tender that statement.


VICE PRESIDENT HATCHER:  The statement of Ken McKell dated 22 December 2017 will be marked exhibit MIA3.


CROSS-EXAMINATION BY MS RODGERS�������������������������������� [10.41 AM]

***������� KEN JOHN MCKELL���������������������������������������������������������������������������������������������������������������� XN MR HERBERT

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


MS RODGERS:  Mr McKell, everything from slaughter floor to load-out, everything between those two elements is processing, isn't it?‑‑‑I would say processing, but it also has to be acknowledged that you do have other operations going on on the same premises geographically.  That can include tanning, it can include stock yards, rendering, and maybe other peripheral activities.


Rendering is processing, isn't it?  You take a raw material and then you process it into something that's useable, a useable product?‑‑‑That's correct.


Rendering is processing?‑‑‑Yes.  Part of the process, yes.


And you agree that packing is direct follow-on, it is processing?‑‑‑It's all part of the process of a processing plant, yes.


SENIOR DEPUTY PRESIDENT HAMBERGER:  In paragraph 11(iii) of your statement you refer to this group of employees engaged in packing, distribution, transport, driving machinery, storage, rendering processes, and hides, or clerical/admin persons?‑‑‑Yes.


And then in your paragraph 17 you say:


Daily hire is utilised to effectively manage the processing workforce and processing establishments and is used very sparingly for non-processing operations in processing establishments.


Are you saying those employees in 11(iii) in processing establishments aren't usually employed on daily hire?  So you might have daily hire for all the other people, but you wouldn't have it for those people in a meat processing establishment?  Is that what you're saying?‑‑‑It's available.  I would say that there would be some plants that may very well use daily hire in those other occupations I've outlined in 11(iii), but as I say in 17, I say sparingly.  But it is available for them.


MS RODGERS:  In paragraph 17 you talk about non-processing operations.  By that you mean clerical and admin.  Is that right?‑‑‑I would say all of those that I've listed in 11(iii).  As I say, there may be other peripheral ones, depending upon the plant.  It may vary, but principally that would be all the other ones that I've mentioned at 11(iii).

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


SENIOR DEPUTY PRESIDENT HAMBERGER:  Could I just jump in again, sorry?‑‑‑Sure.


Again, looking at that group, the non-processing people, non-processing in quotes, and the processing establishment; so they're not employed - they're rarely employed on daily hire, how are they normally employed?‑‑‑There could be a cross-section of full‑time, part-time, casual; any of the four categories available under the award.




VICE PRESIDENT HATCHER:  Is there clear understanding - just looking at your paragraph 17 - of the division between - in a processing establishment, of a division between the processing workforce and those performing non-processing functions?  That is, is there a clear understanding as to who's in which category?‑‑‑From my point of view, your Honour?


Yes?‑‑‑Most definitely.  I mean, again I'm not trying to encompass all into the same sort of structure because they can be different; you know, exporters, domestic plants, et cetera; but principally you're talking about, as I've mentioned, when the stock arrives at the premises.  So you've got the delivery, which may be drivers of the company as well; to that they're held in the stock yards; they go up the ramp; then you have the start, I suppose, of the distinct processing activity, which would start with the stick hole, all the way through the rest of the slaughter floor, then into the boning room, then into the cool rooms, et cetera; and then there's the inter-relationship and connection; therefore before the stick hole and after the boning room, that it gets into the cold rooms, it goes into the load out areas, and then of course at that end you've got drivers who may very well be employed by the company taking the stock away.


I asked that question for this reason, that in our earlier decision, as you will no doubt recall, we identified a problem in terms of having our model casual conversion clause apply to meat processing establishments because that was where daily hire was permitted?‑‑‑Sure.


I'm just wondering whether it can be narrowed further to persons performing meat processing functions in meat processing establishments as being the area of primary concern?‑‑‑My first comment would be that the daily hire under the current award for meat processing would cover that whole gamut I talked about, even administration, clerks; in practice, though, as I've said in point 17, that it's much more likely that it's in that distinct stick hole to the actual end of the boning room type operations that you will find the daily hire.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


Thank you.


MS RODGERS:  Mr Smith provided evidence that there is no industry knowledge and distinction between processing and non-processing in terms of your 17.  I put it to you that you're manufacturing that difference?‑‑‑I'm not quite sure I understand your question.


The proposition is everything from slaughter floor to load out is processing, isn't it?  You've just agreed that packing is direct follow-on and is processing?‑‑‑I think the view would be under the award, in my opinion, that when you look at the definition of a meat processing establishment, it's covering all those areas that I talked about.


Yes?‑‑‑From when the vehicle enters the premises to when the vehicle exits the premises.


So we agree all of those categorisations of employees, they fall under the meat processing establishment in the award?‑‑‑Yes.


And in your 17 you're then seemingly separating them into processing and non-processing operations?‑‑‑With respect to the issue of the use of daily hire, that's what I'm referring to, yes.


And a non-processing employee would be clerical, administration?‑‑‑All those that I've mentioned.


The proposition was put to you that packing is direct follow-on and is processing, and you agreed with that?‑‑‑Yes.  You would find that usually in a boning room of the operation.


If you go back to your 11(iii), which ones in there are you saying are non-processing?‑‑‑Are non-processing?  I suppose the distinction that I'm making, that if you look at 11(iii) probably the stand out ones there would be the transport, driving machinery, maybe storage; rendering, as I've mentioned, with hides; and the admin positions as clerical.


In my earlier questioning it was put to you that rendering is processing, and you agreed with that?‑‑‑It's part of the processing, but sparingly used, possibly as to daily hire use.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


We agree that rendering is processing?‑‑‑Part of, yes.


In your paragraph 21 you've said effectively that union agreements do not generally cover all of those classifications that you've referred to in your paragraph 11(iii), and that includes packers and renderers.  I put it to you that union agreements generally do cover packers and renderers?‑‑‑You would have to go to particular enterprise agreements as to individually who they include and what occupations they include.


Can you name an agreement that precludes from coverage packers?‑‑‑Again I would have to check that.  I can't think of one at the moment.


I put it to you there aren't any?‑‑‑I'm not going to say that.


If I can take you to paragraph 28 of your statement.  You say there that the employment of a casual ends at the end of a working day.  Is that right?‑‑‑That's correct.


And that's the same with daily hire, isn't it?‑‑‑Again, the distinction under the award - I don't have a copy in front of me - but the employment ends at the end of the working day, but the engagement continues.


VICE PRESIDENT HATCHER:  Mr McKell, what prejudice would an employer suffer if there was some mechanism for a casual to convert to daily hire?‑‑‑Prejudice to the employee?


The employer?‑‑‑The situation there would go to, I suppose, the - again, if we were talking about those not covered by an enterprise agreement, because it depends upon the conditions in those - but if was to the award, then there would be the distinction difference between the casual and the daily hire definitions in the award.


Obviously there's a different mode of payment?‑‑‑Yes.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


And the daily hire gets 10 per cent and NES; casual just gets 25 per cent.  But leaving that aside, in terms of flexibility and having the employee there when you need them and not there when you don't need them, what's the difference?‑‑‑You may have a scenario where the company doesn't have daily hire at all.  It may have just full‑time and casual, or sometimes casual alone.  The disadvantage to the employer I suppose is coming back to the distinction between, under the award, casual and daily hire.  Again I would say that because the definition of daily hire in the award talks about - I don't have the award in front of me, but a minimum of 7.6 hours, as such - so then come down to the practicalities of that restricting the employer having them as daily hire, whereas under the casual basis it could be as little as two, three or four hours or more, as such, as to hours of work.  So they would have to meet that minimum standard.


In that situation could they not be converted to part-time daily hire?‑‑‑That is another option under the award, as such.


That is, you have a casual who is working whatever pattern of hours they work, and the casual says, "I'd rather get 10 per cent and NES entitlements rather than 25 per cent", and you convert them into a form of daily hire which in effect matches the working pattern they were doing before, I'm just struggling to identify what difference that would make to the employer?‑‑‑I suppose if we're talking about the option of part - then it's the comparison between the part-time daily hire and daily hire.


Yes?‑‑‑My understanding is I don't think part-time at the moment is used.  I won't put a number on it, but I think it's very minimal, if at all.  So I would say that then you're getting a scenario where the employer is faced with:  let's say all their casuals at the same time wanted to go to daily hire or part-time daily hire, that suddenly is then subject to the effects of if he's having to close down the operation because of shortage of stock or unavailability of stock, and therefore - again, leaving aside the cost factor, which is one factor, the difference, that the commencement of accrual of entitlements may be a problem for the employer as well.


Leaving aside the cost factor, what's the difference - so the plant shuts down, there's no - you put off the daily hire, and it's the same thing, isn't it?‑‑‑I would think that in my view for members faced with that scenario, that automatically having a scenario that they go to part-time daily hire, they were on daily hire, leaving aside the monetary side of it - it's a difficult one to answer in the sense that I haven't envisaged the question.  But I would still feel that there wouldn't be as much flexibility as a casual basis from the point of view of the employer.


SENIOR DEPUTY PRESIDENT HAMBERGER:  But in what way?‑‑‑Again, if you leave aside the casual basis, when you go to the definition of part-time daily hire and daily hire, part-time daily hire says a minimum of four hours, and daily hire says a minimum of 7.6.  With a casual you would then come to the point of they want, say, a greater flexibility that they're not going to get with a daily hire arrangement.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


Because of the minimum engagement?‑‑‑Yes.


MS RODGERS:  Mr McKell, do you agree with the proposition that it is an objective of every plant to work every day of the week if they can?‑‑‑I think ideals is one thing, but the practicality is another.  Is it ideal?  I think any business would try to operate as often as they can and every day that they can; whether you're talking about one shift, two shifts or whatever; but that's not the practicality of what occurs.


So you say the circumstances often prevent that objective from being achieved?‑‑‑Yes.


So you agree that ‑ ‑ ‑ ?‑‑‑Sorry, I should add, too, that again you would have scenarios where - particularly if we're taking about meat processing, we're talking about that sector, that there are a lot of enterprise agreements that restrict Monday to Fridays where the employer might want to go beyond that as to weekend work; and the award allows for weekend work as such, too.  So that's the ideal, possibly, that they could be operating and employing a lot of employees seven days a week ‑ ‑ ‑


And that's the objective?‑‑‑ ‑ ‑ ‑ but that's not always the practicality.


So the proposition:  it is an objective of every plant to work every day of the week if they can, but circumstances often prevent this objective being achieved; you agree with that?‑‑‑That would be the determination of each owners of each individual plant.  I can't speak for them, that's their decision.


If I can just take you to paragraph 35 of your statement.  In your second sentence you say:


In other words, the union draft may allow for casuals not required by employers for extended periods of time during 12 months to be entitled to convert.


That's not right, is it?  There's no entitlement to convert in the model clause, it's a right to request?‑‑‑It's referring to, obviously, the union draft.


Do you see a right to - an entitlement to convert within the union draft?‑‑‑I don't have that in front of me, but for the purpose of that, as I've said, the union draft is inferring that, yes.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


I put it to you that the union draft is based on the model, which is a right to request casual conversion, and a corresponding refusal on reasonable grounds on the part of an employee, is not an entitlement to convert?‑‑‑Sorry, can you rephrase that?


VICE PRESIDENT HATCHER:  I think what's being put to you is that the AMIEU proposal picks up the provisions of the model clause which give the employer the right to refuse conversion on reasonable grounds.  You understand that, don't you?‑‑‑Yes, yes.


Thank you.


MS RODGERS:  Thank you, nothing further from me.


VICE PRESIDENT HATCHER:  Any re-examination Mr Herbert?


MR HERBERT:  No thank you.


VICE PRESIDENT HATCHER:  Thank you for your evidence Mr McKell.  You're excused and you can return to the Bar Table.

<THE WITNESS WITHDREW��������������������������������������������������������� [11.00 AM]


Right, so that's all the evidence.  Submissions Ms Rodgers?


MS RODGERS:  Thank you, your Honour.  We seek to rely on our submissions dated 2 August 2017 and 22 December 2017.




MS RODGERS:  Thank you.  On Wednesday of this week, my friends provided their consolidated position, their summary of their position in advance of today's hearing.  In doing so, they've supplied a proposed casual conversion clause.  What we now have before the Full Bench is a proposed casual conversion clause from my friends that covers meat manufacturing establishments, meat retail establishments and those employees of meat processing establishments who are engaged in retail and/or wholesale sales of fresh meat and/or meat products and any ancillary products.

***������� KEN JOHN MCKELL������������������������������������������������������������������������������������������������������������ XXN MS RODGERS


That is the majority of the meat industry award that would be covered by our friend's proposed casual conversion clause.


VICE PRESIDENT HATCHER:  Apart from the limited - I haven't analysed this, but apart from the limitation on scope, is that the same as the model clause?


MS RODGERS:  I understand it is, apart from - there's an insertion I think, in it, making a new paragraph (a) and the balance of that is the model casual conversion clause with references to the dispute resolution procedure, updated for our award.


What we don't agree on, concerns the balance of meat processing establishments.  Our friends have said yes, those employees of meat processing establishments engaged in retail and wholesales of fresh meat, they can have this casual conversion clause cover.  But what we don't have agreement on is the rest of meat processing.  I propose to make some fairly brief submissions concerning the balance of meat processing establishments.


In terms of the consideration of meat processing establishments, we say that really there are two defining characteristics, the first of which is the composition of that workforce.  In looking at that composition of the workforce, we've seen the statement from Ken McKell dated 22 December and he fairly succinctly outlines that a meat processing establishment can encompass a very broad cohort of workers.


The point being made by Mr McKell in his statement, is that we can't just focus on the boners, slicers and slaughterers.  We also need to consider these many other workers in packing, in distribution, in transport, in driving of machinery, in storage, in rendering processes, in hides, in clerical admin to a limited extent, as described by Mr Smith and also people performing cleaning duties.


Those workers are considered to be part of a meat processing establishment, irrespective of them being, as Mr McKell says, completely separate.  The work of those workers is not necessarily dependent on the work of the others.  Your kill floor can be stopped, but the rest of the work can continue on.  We say when we think of meat processing establishments, we need to be thinking of that broad cohort of workers.


We also need to keep in mind, that obviously meat processing establishments have access to daily hire and part time daily hire, but it's not used in every state.  As described by Mr Smith, Western Australia and Tasmania for example, haven't necessarily picked that up.  In terms of daily hire and those flexibilities, daily hire does recognise the volatility within our industry.  It does provide flexibility for an employer not to employ someone on a particular day, but that engagement continues.  Most importantly, those workers do get their NES entitlements with the exception of NOTAS.


VICE PRESIDENT HATCHER:  Do daily hire workers, if the engagement as a whole is terminated, get notice at that point?


MS RODGERS:  No, I don't believe they do.  Sorry?




MS RODGERS:  Payment of one day's notice.


VICE PRESIDENT HATCHER:  There's an exclusion in the Act for that, is there not?






MS RODGERS:  But the Full Bench in the previous hearings has already heard evidence about the operational differences between part time daily hire and casual.  If I just look at the transcript of the proceedings, on Tuesday 22 March, from PN8065 the question is put to my friend's witness, Mr Gary Johnston.  Gary Johnston was the legal practitioner for AMIC for a considerable length of time.


The question was put - yes, so for operational purposes, in terms of the ability to put people on and put them off when work is quiet, what's the practical difference, if any, between part time daily hire and casual employment with a four hour minimum?


Mr Johnston responds - on looking at the award, then he concedes one would have to say, there's not many.  There's no real difference in terms of employer flexibility, and we say that's important.


DEPUTY PRESIDENT BULL:  Ms Rodgers, the reasonable predictability of hours for part timers, is that a difference from casuals?


MS RODGERS:  I'm sorry, I missed that.


DEPUTY PRESIDENT BULL:  Under the definition of part time under the award, it talks about having to have reasonable predictable hours.  Does that apply to casuals, or will it apply to casual daily hires, sorry, part time daily hires?


MS RODGERS:  In terms of the part time daily hire categorisation, it is more like a casual employment relationship.  The employment terminates at the end of the day; they have four hour minimum similar to casual employees.  The engagement continues, but the employment is by the day.  So, similar to casuals, an employer has the flexibility not to utilise an employee on a given day.


VICE PRESIDENT HATCHER:  The requirements we see in clause 13 to part time employment are not relevant to part time daily hire?


MS RODGERS:  They're not relevant.  My apologies if I missed part of your question.  Those provision are certainly very separate.




MS RODGERS:  In turning to the two proposed clauses that the AMIEU has provided, we've proposed wording that would work in our industry and was drafted with the Full Bench decision and the model clause itself very much in mind.  In terms of what we've proposed, as you'll see, a strict averaging of casual hours to determine the category of permanency would pose difficulties and that was the evidence within Mr Smith's second statement MIA2.


My friend's arguments concerning that averaging seem somewhat confused and contradictory.  Mr McKell, in his statement talks about a 38 hour average as being an important underpinning part of daily hire employment and that it's a significant benchmark to all of those employees.  But at the same time, in my friend's most recent submissions from Wednesday, particularly at paragraphs 14 and 22(xxi), they argue that daily hire is as irregular and insecure as casual employment.


We say simply it can't be both.  You can't argue that there's a fair 38 hour average in one breath and then make a conflicting argument that leads to a conclusion that 38 hour average is absolutely unachievable.  We say, particularly in Mr Smith's second statement that there are difficulties in our industry concerning any strict average in terms of daily hire.


To deal with that, we've proposed those two alternative.  The first is annexed to our 2 August 2017 submission and that provides for a proposed conversion to permanent employment that's based on the work actually on offer by the employer, rather than with reference to averaging.  The proposition is simply, if a casual has worked all of the days that are on offer, and that the daily hires have similarly worked, then that conversion ought to be from casual into daily hire.  Similarly, if a casual has not worked all of the days of a daily hire, then consideration should be towards going from casual into part time daily hire employment.


The wording that we've proposed is in looking at, predominantly, daily hire.  Our friends have argued that phrase, create some form of uncertainty.  In support of its argument around uncertainty, my friends have tried to distinguish between process and non-processing employees within meat processing establishments.  In their submissions, they refer to it as production and non-production employees within meat processing establishments.


We asked Mr Smith on the stand, is there an industry standard in terms of distinguishing between those groups of employees.  He says no, there isn't a clear distinction between them.  He says that from when the cattle get off the trucks into the kill floor to when they're loaded out, that is processing.  Any artificial distinction in there, doesn't make sense in our industry.


Mr McKell provided some somewhat contradictory evidence agreeing that rendering and packing are processing tasks to be undertaken, but then continued to rely on his paragraph 11(ii) in the face of his own admissions, so that was somewhat confused.


We say, if you're going to artificially distinguish between processing and non-processing employees at a meat processing establishment, then you'll probably have some of the uncertainty or definitional problems that our friends have raised in their submissions.  But both the definition that has been concocted and the problems that appear to arise from that definition have been manufactured.


It also appears that while creating this artificial distinction, our friends have simultaneously conceded that daily hire is used very sparingly for non-processing operations in processing establishments and that's said at paragraph 17 of Ken McKell's statement.  We say that there isn't a difficulty; there isn't a conflict using the phrase predominantly in daily hire.


Predominantly is used in our award, as described by Mr Smith.  It's how you categorise a meat processing establishment as either being a manufacturing processing or retail.  We know what it means and we know that it can be simply applied.


In our second draft - - -


VICE PRESIDENT HATCHER:  Are there any meat processing establishments who just use the award?


MS RODGERS:  My apologies, what was that?


VICE PRESIDENT HATCHER:  Are there any meat processing establishments who just use the award?


MS RODGERS:  Yes, yes there are.


Concerning our second draft casual conversion clause which was annexed to our 22 December submissions, that proposed a more simplified version.  Doing away entirely with an averaging of hours, and just looking at the proposition of can a casual be reasonably converted into a comparable form of permanent employment.  We've said we've used those words 'reasonably comparable' and we say that's pretty - - -


VICE PRESIDENT HATCHER:  Is it likely that there will be any circumstances in a meat processing establishment where conversion from casual straight to permanent full time or part time is going to be a viable proposition?


MS RODGERS:  I certainly wouldn't discount that as a possibility.  I would say that there are - we would say that there are casuals working full time equivalent hours.


VICE PRESIDENT HATCHER:  In circumstances whether they're called daily hire or whether they're on some other slight variance of that model, conversion from casual to full time would be subject to a reasonable objection on the basis that you couldn't stand them down if the establishment had to shut down.


MS RODGERS:  That's correct.


VICE PRESIDENT HATCHER:  I'm just trying to work out whether we need a clause that deals with conversion to full time or part time at all.  If the practical outcome is simply that in every case, there will be a reasonable objection to it.


MS RODGERS:  Thank you, your Honour.  Very good questions, and it's our position that a casual conversion clause relevant to our industry should be as open as possible, as flexible as possible.  So, in circumstances where an employer is using daily hire to account for those fluctuations, then a casual conversion clause ought to allow for conversion into regular daily hire.  Similarly, if an employer is using full time permanent employment without stand-downs, or the ability not to employ people by the day, then that conversion also ought to be accommodated.


VICE PRESIDENT HATCHER:  Is there any evidence that any meat processing establishment uses a predominantly full time workforce with no stand-down capacity beyond normal capacity under the Act?


MS RODGERS:  My apologies, we don't know the answer to that.  We certainly know of enterprise agreement based workers, particularly in Western Australia that would fit into that category, but award based, we simply don't know.




MS RODGERS:  We say that our second casual conversion clause is consistent with the reasoning of the Full Bench, particularly looking at paragraph 376 in which the Full Bench said:


The essence of a casual conversion concept we consider is that the casual employee has been working a pattern of hours which, without significant adjustment may equally be worked by the employee as a full time or a part time employee.


We say this is about moving a casual into a reasonably comparable form of permanent employment is certainly consistent with that reasoning.


In terms of the references to clause 11.4 in our friend's submissions.  11.4, as you've already heard from Mr Smith, is a provision within the award that allows, on seven days' notice, a processing employer to convert employment from daily hire into full time employment; from part time daily hire into part time employment, and vice versa.


VICE PRESIDENT HATCHER:  One of the things we said in the first decision is that it would not be a lot of point converting a casual to a full time permanent position or part time permanent position because then the employer just uses 11.4 to put them down to a daily hire position.


UNIDENTIFIED:  That's right.


VICE PRESIDENT HATCHER:  Do I take that as a response?


MS RODGERS:  Thank you, you are absolutely correct and it is for that reason that we suggest having that flexibility to convert to casual directly, to daily hire.


To follow on from that, the criticisms about our not putting a reference to 11.4 in our draft clause we don't really know what to say about that criticism, except that our proposal isn't inconsistent with 11.4.  There's no attempt on our part to circumvent 11.4.


If the suggestion is that we should include a reference to it within a casual conversion clause, we don't really see the point; the clause applies, we all know it does.  We're not looking to have a technical argument about overlapping or interlocking clauses within an award, we're simply trying to have an uncomplicated casual conversion clause that provides certainty to our casuals within the industry that could easily convert to permanent employment within NES entitlements attached.


In terms of the reasonable grounds for refusal, you'll see that in each of our proposed clauses, we have adjusted what would be a reasonable ground for refusal and our reasoning in terms of that is, is fairly simplistic.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Just to take you back, in your clause, you've got this - I'm looking at (h)(ii).  If it is agreed that the employee will become a part time or part time daily hire employee, then matters referred to in clause 13 as applicable, but - it's only clause 13.3 that's not - but part time daily hire, is not applicable at all, is it?  Clause 13.


I'm just thinking, it's not wrong, it's just, it could be confusing.


MS RODGERS:  You're right.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Because what's the benefit of the reference to part time daily hire when clause 13 isn't applicable to part time daily hire.


MS RODGERS:  No, you're exactly right.  I would respectfully submit that that would need to be remedied.


VICE PRESIDENT HATCHER:  You could just take out the part time daily hire?


MS RODGERS:  Absolutely, absolutely.  No thank you, that's a very good pick-up.  Thank you.


In terms of the reasonable grounds for refusal, as we've provided in our submissions, we would see that there would be the need to adjust the model clause simply because a refusal shouldn't be on the basis of the normal conditions of our industry, so we've made that proposal accordingly.


VICE PRESIDENT HATCHER:  Sorry, where's that reflected - in the second clause?  Yes, thank you.


MS RODGERS:  If you're looking - so it's (f)(iii) of the further submissions.


In summarising our position, we respectfully submit that all regular casual workers covered by the Meat Industry Award should have access to a casual conversion clause.  We genuinely see no basis for excluding the bulk of casuals in meat processing establishments.  To exclude those employees, to exclude processing establishments, means excluding clerks, people in rendering, all of those broad cohort of workers that we've previously touched on.  It would also mean to exclude processing establishments in - for example, Western Australia where they don't use daily hire.  We say, precluding processing establishments will simply not meet the aim of the Full Bench.


There would be a considerable disadvantage to a large number of casuals if the Full Bench was to do so.  With our daily hire and part time daily hire that's rarely used and our volatility, we certainly like to see our industry as being special, but we're not so special that our regular casuals ought not to have the right to request a comparable form of permanent employment.


In terms of the use of casuals, the evidence of our friends led in the previous proceeding, and again it's in the transcript from Tuesday 22 March 2016, was that an establishment determine the proportion of casuals that will be used and that it's not a necessary result of our industry.  So, in terms of that transcript at PN8070, again Mr Garry Johnston was asked:


The proposition I want to put to you is this one, that to the extent any particular establishment uses a high proportion of casuals, that is a decision that is made by the enterprise, as opposed to the necessary result of the nature of the industry.


Mr Johnston agrees, he says:


The answer would have to be yes.


The use of the large numbers of casuals in our industry is not because of the industry and not because of that volatility; it is a choice that's being made by establishments.  A choice not to allow workers to have access NES entitlements.


The question was put to Mr Smith.  "Why is casual employment in such high use?"  His response was very simple, "We don't know."  There's no need for it, there's no reason for it.  When asked, "What are the operational differences?  What is the impost on employers?"  Mr McKell seemed to flounder a bit as well.  There just simply isn't any burning need to retain a casual workforce that high.  When those casuals are regular, they could have been in the industry for years and they should have an avenue to permanency.


The Full Bench, we say, at paragraph 377 of its decision did touch on the flexibility that we say could be in a casual conversion clause relevant for meat processing.  The Full Bench said:


It will obviously follow from the adoption of that criterion, that's the criterion that a casual working a pattern of hours on an ongoing basis can covert without significant adjustment to a permanency.  From the adoption of that criterion that the more flexible the hours of work provisions for full time and part time employees are, the greater opportunity there will be for casual conversion to occur.


We say that last sentence is highly significant to meet processing establishments.  The Full Bench in that decision, in that sentence, is focussing on those greater opportunities for casual conversion to occur and in doing so, is considering what flexibilities are inherent in awards in terms of the hours of work provisions.  The Full Bench says:


The more flexible the hours of work provisions for full time and part time employees are, the greater the opportunity there will be for casual conversion to occur.


We say it follows then, that even more flexible categories of permanent employment, our daily hire, our part time daily hire, will provide those greater opportunities for casual conversion to occur.  We say simply, that that's the point because there are casuals within our industry that do not have access to the entitlements provided for in the NES even though they are working hours that are comparable to those worked by permanent workers.  We say daily hire is key to that.  It provides NES entitlements with the exception of NOTAS.


We respectfully submit that our casuals ought to have that avenue to request permanency, and of course, there are provisions that provide an employer may deny that request on those reasonable grounds as outlined.  My friend in their submission has said that moving from irregular casual employment into what they say is  irregular daily hire employment, they take issue with that.  But we would very simply say that the Full Bench at paragraph 366 has very clearly the problems for employees that they face being casual, that is, attending for work while they're very unwell, that they're afraid to take annual leave, recreation leave because they're not certain that there will be a job to come back to.  The inability to balance work with personal and carer responsibilities.


In addition, the Full Bench found there are other detriments associated with casual employment.  Lack of a career path, diminished access to training and workplace participation, poorer health and safety outcomes and the inability to obtain loans from financial institutions.  We say that access to a casual conversion clause and hopefully people actually converting to regular daily hire that provides the same flexibilities to employers, will actually address some of those poor outcomes currently being suffered by casuals.


Our proposal is for two casual conversion clauses.  One as relates to meat processing establishments and a second that relates to meat retail and meat manufacturing establishments.  We understand that the Full Bench might not be minded to insert two casual conversion clauses into the award, and that the Full Bench may propose wording that is alternate to the two variations that we've provided in terms of processing.


We say simply, that we would certainly welcome the opportunity to work towards a casual conversion clause that the Full Bench is certainly happy with.  However, it remains our very firm but respectful view that our casuals ought to have access to a casual conversion clause with respect of the entirety of meat processing establishments.


Thank you.


DEPUTY PRESIDENT KOVACIC:  Just a question on that last point.  Is there any reason that you couldn't have one - in the sense that daily hire and part time daily hire are largely available solely in the meat processing sector, the use of that language, would that mean that you still have to have two provisions or two clauses around conversion?  Or, would sort of the reference to daily hire and part time daily hire by default necessarily restrict that option to the meat processing part of the award?


MS RODGERS:  Certainly, it would be possible to have one clause to cover those three different types of establishments.  We had split them simply in terms of the daily hire categorisation.  Retail and manufacturing that don't have access to it and processing on the other hand that does.  We thought that was a simpler way of structuring it.  However, the point is well made.  Certainly, it would be possible to have one clause that covered everyone, as long as those references were correct.


Than you.


VICE PRESIDENT HATCHER:  Mr Herbert, how long do you think you'll be?


MR HERBERT:  I suspect about 30 minutes.


VICE PRESIDENT HATCHER:  Mr Keats and Mr Crilly, you can stay if you want, but I might mark you as not before 12, now.


MR KEATS:  Thank you, your Honour.




MR HERBERT:  Thank you, your Honour.  Your Honour, the position of the AMIC, we attempted to reduce much of what we have to say into a written submission which we forward to the Commission early this week.  Can I take that submission as read for the purposes of what I have to say?




MR HERBERT:  The broad position of AMIC of course is that it submits, as it has always submitted throughout these proceedings, that this award should not be subject to a casual conversion clause in the sense that the industry is beset with a range of problems which don't really affect any other industry, and certainly not to the same extent in relation to the volatility of supply issues and therefore the volatility of the demand of labour throughout the industry, really from the top to the bottom.


That evidence was given in the initial proceedings and we rely on the fact that daily hire has been, particularly in relation to the meat processing establishments, where it is effectively since time immemorial, been a feature of the awards, has been retained not only in the awards, but retained in very active use throughout the industry as the earlier evidence suggests.  That's all the evidence, including the evidence of the union, suggests that that is an inescapable feature of this industry.


As it's been demonstrated in these submissions, it is, notwithstanding there are different illustrations in the award as between the meat processing facilities and meat manufacturing and wholesale retail, as a reflection of the earlier distinction, when there were the three awards that were joined together, effectively to make this award.


The volatility issues that justify the use of daily hire still in 2018 are as Mr Smith said in his evidence today, will never go away.  They are a background feature of the whole of the industry.


VICE PRESIDENT HATCHER:  No one is debating that proposition as I understand it.




VICE PRESIDENT HATCHER:  But the real question is, in meat processing establishments, why could we not have a casual conversion clause which at least simply allows the right to request conversion from casual employment to either full time or part time daily hire?


MR HERBERT:  Your Honour, to put that proposition, the difficulty is as we've put out in the submissions and which I seek to elaborate upon now, very briefly, is that the characterisation of who might be eligible to apply for what.  And your Honour has mentioned if you're a casual employee you could apply for full time daily hire or part time daily hire, the way in which the original template clause was set out in the decision, distinguished between those who could apply for a full time situation and in that case, full time employment, or part time employment.


The characteristics of the employee in question in relation to their pre-existing employment, was set out as being those who work 38 hours a week or more and those who work less than 38 hours.  Those who work 38 or more of course were entitled to apply for or to request full time employment and others were entitled to request part time employment that reflected the hours that they had previously worked.


The transposition of those criteria across into this award, has really escaped the imagination of all of the parties at the Bar Table, because what the unions latest second proposition suggests is that a person who works a pattern of hours that can be transposed, is entitled to ask for appropriately equivalent - I'm paraphrasing, but appropriate equivalent employment.  But of course, to work a pattern of hours that can be transposed is meaningless.  It doesn't give and it doesn't have the qualification that the resulting employment category into which the person is seeking to be placed, would in fact mirror or largely reflect, what was their pre-existing employment pattern.




MR HERBERT:  I beg your pardon?




MR HERBERT:  The clause doesn't say anything about that.  It doesn't make any provision for that.  That's the union clause.  The difficulty is in relation to this industry, for the reasons that we've been at pains to point out in relation to volatility, the question of whether there is demonstrated pattern of hours, would become a very moot point.


VICE PRESIDENT HATCHER:  It may be that some of the requirements in the model clause would be unnecessarily rigorous in the case of meat processing establishments because the degree of flexibility of daily hire which you've emphasised means that you don't really even need a pattern.  You just need a pattern of employment which would be capable of conversion to daily hire.


MR HERBERT:  But again, there are very significant issues about - there is no issue about a pattern of employment that has resulted in an average of 38 hours a week, or some other average of hours, but in circumstances of daily hire casual, in this industry, the question will be whether ever such a pattern does exist or has been proven to exist anywhere.  What it comes down to is this, the union proposition with respect to - what your Honour just said comes down to this, it's the fact of employment, as a casual employee, is the only criterion one can select.


Because a question of pattern in this industry is an extremely debateable proposition as to whether there is such a thing as a pattern in circumstances where you could be stood down, in fact, terminated on a day to day basis from your employment.  In this industry that routinely occurs.  Whether that is a form of employment where that is permitted and does occur, is a form of employment which can't be appropriately described as one which bears a characteristic pattern of any kind.


If one can't establish the existence of a pattern, in order to establish that one is qualified to make an application under the clause which might have some parts removed, as your Honour mentioned, would, as I submitted earlier, simply come down to the fact of employment.  If you are employed as a casual, you're eligible to apply to be granted some other form of employment.


SENIOR DEPUTY PRESIDENT HAMBERGER:  If you've been there 12 months.


MR HERBERT:  If you've been there 12 months, yes, you're eligible to apply.  It may be that there is literally no pattern to their employment during that period.


SENIOR DEPUTY PRESIDENT HAMBERGER:  If that's the case - I mean, if daily hire is that flexible, that if you like, any pattern of work over a period of 12 months that is something that could be accommodated by daily hire, so that means you're entitled to apply, but what's - so, what's the problem?  Why is that a problem?


MR HERBERT:  Well, there comes to be - I suppose, could I approach it another way, your Honour with respect?  I'm not avoiding that question, but it is - we are dealing with a provision which is in order for the Full Bench to insert it into the award, needs to be necessary in order to achieve the modern award's objective.  In my submission, it's an inversion of the proper test to ask, well what's wrong with it.


SENIOR DEPUTY PRESIDENT HAMBERGER:  No, no, but we've already said that it's consistent with the modern award's objective to, if you like, try and promote employment arrangements where people have access to the NES.


MR HERBERT:  Yes, yes.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Obviously, the big distinction, or a significant distinction between casual employees under this award and daily hire, is that daily hire employees have access to the NES.  That's where the argument would be, that it would make it consistent with the modern award's objective.  It's not just that it wouldn't make any difference; it would make a difference to those employees because it would give them access to the NES.


The question is what problem - would it create any real problems if you did allow it?


MR HERBERT:  It would.  The problem I suppose, is in formulating who is entitled to apply for what, so that the employer parties have an understanding of what it is that their obligation might be and to whom they owe it in the circumstances.  Now the original clause was - - -


VICE PRESIDENT HATCHER:  But that, with respect, is just a drafting issue, it's not a conceptual objection.


MR HERBERT:  Well, it's more than a drafting issue because it's not been formulated yet in relation to any of the drafts that the Commission has.  We would say that's reflective of the circumstances in the industry, because to simply create a circumstance where a casual employee whose been employed for 12 months or who has been on the books presumably for 12 months, although not necessarily employed, with any pattern, with any period of hours or days involved, is entitled to apply to be granted a different standing, would place that employee into a position where as we put it earlier, if they're entitled to apply for a part time position, that could be converted by the employer to part time daily hire.


VICE PRESIDENT HATCHER:  Let's just deal with daily hire, I'm just dealing with daily hire at the moment, that is, if the clause simply said, as you just posited, a casual employee who has been on the books for more than 12 months, may apply for full time or part time daily hire, and there's still the same reasonable grounds of objection.




VICE PRESIDENT HATCHER:  What's the conceptual difficulty for employers with that in meat processing sanctions?


MR HERBERT:  The practical difficulty in that perspective, that's what your Honour refers to, is as the evidence has been, effectively there would be little difference in the employee's position, other than a change in the manner in which they are paid.




MR HERBERT:  There isn't, and I must correct something that was said I think by Mr McKell in evidence, the minimum hours is four hours in each case for a part time daily hire and a casual employee, so there is no difference there, I should correct that.  As has been said by a number of witnesses, in practical terms the employees would only have a change in the way in which their remuneration is structured.  They would effectively not have a change in their security of employment.  They would not have any change in the extent to which they can be required to attend work or effectively the days in which they could be required to attend work.


VICE PRESIDENT HATCHER:  That's all true, but aren't you arguing against yourself.  I mean, that's the point, isn't it?


MR HERBERT:  I'm answering your Honour's question as honestly as I can.


VICE PRESIDENT HATCHER:  Well, that's the point.  The only change is, they're still - for all intents and purposes a casual, except instead of getting 25 per cent, they get 10 per cent plus NES.




VICE PRESIDENT HATCHER:  So, if the casual says I'd prefer to have that deal, what's the employer objection?


MR HERBERT:  There is, from the employer's point of view, there is ongoing expense that Mr McKell spoke of that all public holidays that occur during a period when the daily hire employee is not working, must be paid by the employer, unless they terminate their underlying engagement.  Whereas, with a casual, that does not occur.


VICE PRESIDENT HATCHER:  That's true as one element of it, but we don't have any cost analysis which balances a full 25 per cent as against NES plus 10, that gives an overall result one way or the other, do we?


MR HERBERT:  No, no, we haven't gone to that, because this matter wasn't explored in the primary proceedings as to why that might be so.  But there is an expense which doesn't exist in relation to casual employees.  There is that provision.  There are formal structures around maintaining persons who are employees on the books who are not currently working from the employer's point of view.  But if the evidence one has to concede is that there would be little practical difference in the employer's arrangements other than the fact that once the casual employee is finished for the day, then they are, to all intents and purposes, no longer employed by the employer and the employer has no ongoing responsibility in relation to that employee unless and until they engage them again as a casual, as in the nature of normal casual.


From the employee's point of view, as we put in the submissions, one wonders whether this would be the least bit attractive to any employees, given the reduction that they would receive in remuneration for the days that they do work and as to whether a pro rata NES, as your Honour points out, there's been no analysis done of that.


There's also the consideration in my submission, that the matters which move the Full Bench which were referred to by the union in relation to the observations in paragraph 366 of the decision and they are all of the factors of the perceived disadvantage of casual employees.  The submission as put that those matters would be remedied by a proposal in relation to which the employees would move across to daily hire employment.


The difficulty with that submission is that it doesn't make any difference argument, destroys the efficacy of the submission - or destroys the effect of the submission that these problems are going to be remedied, the problems identified in paragraph 366 are going to be remedied by daily hire employment.  One, it's not going to achieve any greater regularity or stability in one's employment.  One has no right to any form of notice other than one day.  The exemption provision to which your Honour referred in relation to notice is section 123(3)(b) referring to daily hire employees and (d) referring to weekly employees who are terminated for seasonal reasons.  They're exempted from the notice provisions.


If one looks at all of those matters as being factors which move the Full Bench to make this change in the industry, none of them would be remedied.  There is only the NES which is again, a change.  It's not as it they have no compensation because the 25 per cent penalty loading is generally considered to be a reimbursement for the absence of a number of NES entitlements.


VICE PRESIDENT HATCHER:  What it does remedy is the proposition, the first sentence of 366, that is the employee is not permanently denied access to the NES entitlements, based simply on the employer's preference.


MR HERBERT:  Yes, and I've conceded that.  But they're not permanently denied the NES, but that is all there is.  The balance of that paragraph, none of those matters will be remedied by a change of this kind.


VICE PRESIDENT HATCHER:  That's true, but that's the employee - that would be up to the employee to choose, whether it was worth it or not.


MR HERBERT:  Yes, that's right, but I make the submission that the considerations that move the Commission to move in this direction, other than the NES matter, are not present in the case where the only effective and available change in very may circumstances will be to a daily hire employment situation which is, in effect, another kind of casual employment, as reinforced by the various statements that have been made that there will, for many and almost all purposes other than the NES, be no different in relation to the employment circumstances of the employee in terms of security, predictability, capacity to go to the bank and get a loan and things of that kind.  They will not be able to, by telling a bank manager that you're a daily hire employee as opposed to be a casual employee because in a very large part, they are one and the same.


The moving factors - I can't put it any higher than that, that the factors that move the Commission are, except for the NES, almost entirely absent.  That, in my submission, goes to the question of whether this is required, this provision is required in this particular case.


DEPUTY PRESIDENT BULL:  Mr Herbert, at this point in time, what motivates an employer to offer a casual a daily hire job?


MR HERBERT:  I'm sorry?


DEPUTY PRESIDENT BULL:  What currently motivates an employer to offer a casual a position of daily hire?


MR HERBERT:  To transfer a casual into a daily hire. I'm not aware of that situation occurring, I don't have any particular information that I can share with you, your Honour about that.  There would be - under the current arrangements, very little.  The only thing that perhaps might occur would be that a person being called daily hire and having ongoing engagement, as it were, theoretically, may in those circumstances, consider themselves, more bound to their employer and to that position, rather than a casual who may feel themselves free to disappear.  But beyond that, there would be - there is no incentive on the employer to make that offer.


VICE PRESIDENT HATCHER:  Given that we know that there's meat processing establishments which basically use daily hire as their working model, there must be a reason why they do that, instead of just employing them all as casuals.


MR HERBERT:  Potentially, historically in many cases, but also because the model about which evidence was given in the earlier proceedings, as I understood it, was that the daily hire in very many establishments is the core workforce.  That is the group that they keep for that purpose.  Casuals are utilised for those parts of the business which are so occasional and episodic that it doesn't justify putting some person on daily hire, where the expectation is that they will work as much as they can work.  Whereas, a casual on the other hand would be engaged to fill in the ends and stops of production without making any form of enduring commitment that that person is going to be able to continue at the plant or have any expectation of continuing.


Mr Smith talked about an expectation of ongoing walk and no doubt, there would be a mutual expectation that any future work would be ongoing and would be made available to daily hire employees, but no such expectation in relation to casuals.  So, one can't really put it any higher than that because the circumstances of being able to move those persons, the casual employees in and out of the business is a reflection of the fact that at the edges of these businesses, very often, the changes are on a daily basis or a weekly basis.


Could you excuse me a moment?  The evidence of Mr Cotterill in the original proceedings.  Mr Cotterill is no longer with us.  He has - - -


VICE PRESIDENT HATCHER:  In an employment sense.


MR HERBERT:  No.  He passed away a couple of weeks ago.  His statement in paragraph 29 in the original proceedings, I'll just simply read it rather than take the Commission to it.


This is the issue of balancing the potential cost of overstaffing with the need to have trained staff available when they're required.  In a volatile supply environment, it is a difficult task.  The issue is traditionally managed in the majority of large and many small processes in Australia by the long-standing practice of engaging the majority of the workforce's daily hire employees who can be stood down on a day to day basis when significant shortages or plant closures occur, supplemented by casual employees at the margins to make up the lesser shortfalls on part days that occur on a more regular basis.


I believe this method of labour planning in very many establishments is an essential and unavoidable to meet the structural problem of volatile production in the environment of meat processing and is not, in my experience, an arrangement that is merely a matter of choice or convenience.


To answer something that was said.  So that having employees who have been the subject of very considerable training and expensive training in some cases and long experience, having an attachment to the business and granting those persons daily hire employment, when ordinarily one would secure the loyalty of employees by permanent employment in that situation, well highly trained employees.  In this industry, the securing of such employees by permanent employment is in many many plants not viable because of the volatile issues.


So, the best that an employer can do, is to grant that employee daily hire standing.  Those that the employer believes that it does not need on a more regular basis and who might be less trained or of less use to the business, in that sense, are retained on a casual basis to fill in the gaps at the margins.  It would appear that that is about the only - it is both historical and practical in a sense that employees are to be given some sense of belonging to the business by the granting of daily hire and if they're not required in that way because the business doesn't have that continuing amount of work for that number of people, then the engagement is usually casual.


Beyond that, I can't take the issue any further.


SENIOR DEPUTY PRESIDENT HAMBERGER:  That does suggest the converse, that from an employee perspective, if they become - if a casual becomes a daily hire employee, can in practice expect - would have more of a reasonable expectation of ongoing employment.  If it works one way for the employer, it must work the same way for the employee.


MR HERBERT:  Yes, your Honour, expect this.  If the request is made by the employee and it doesn't arise out of a perceived need by the employer, that doesn't necessarily apply.  The way in which daily hire employees are viewed in these circumstances may well change if they're not put on because the employer believes they need them, but because they have an entitlement to apply, unless an employee can show good reason, then the employer must accept that request.


The word special was used before about this industry.  It has particular characteristics in that regard which are the product of very very long experience and necessity.  They're not mere - as Mr Cotterill put it, it's not a matter of mere convenience or choice, it's a matter of necessity in structuring the business in the best way they can, so they don't have labour standing around that they can't use.


DEPUTY PRESIDENT KOVACIC:  But Mr Herbert, one inference you could draw from the extract that you read from Mr Cotterill's witness statement is that if casuals are generally used as a top-up form of employment, one you would envisage that they wouldn't necessarily satisfy the requirement for having been employed on a regular basis over a period of 12 months.  To the extent that they do get across that hurdle, if they're converted to a full time role, you've got the capacity under this award, in clause 11.4 I think it is, and it's a point that I think the Vice President mentioned before, the flexibility on seven days' notice to convert them to daily hire employee and vice versa.


To the extent that there are practical issues that arise, there's a range of mechanisms that either exist in the award or in what might be the clause to either address that.


MR HERBERT:  There are, but at the end of that day, however, the employer will still then be required to accept more than the number of daily hire employees that their business case suggests.


DEPUTY PRESIDENT KOVACIC:  Mr Smith, in his evidence, and I'll use the adjective, begrudgingly accepted in response to a question that you put to him, that there's no obligation to offer employment to a daily hire employee if the work doesn't exist.


MR HERBERT:  So we go round the circle that I painted before that the employees are not advantaged by this mechanism.


DEPUTY PRESIDENT KOVACIC:  Well, if they're not advantaged, they won't apply for it.


MR HERBERT:  Well, they might find out afterwards.  They may have a different view before than after, as litigants often do.




MR HERBERT:  Well, again I can only repeat the submission that that doesn't speak well for the necessity of a provision of this kind, that some employees might have a go.


VICE PRESIDENT HATCHER:  Mr Smith's evidence was, and I didn't hear him challenged, that he thought the majority would prefer daily hire, even if it's a substantial minority, as the early decision says, it's no reason to deny them the opportunity.


MR HERBERT:  The Full Bench is entitled to make what you will of that evidence, but in my submission that involves a very high degree of speculation about what the majority of people out there, whoever that might be, might want.  But again, we're talking about matters of what is necessary and what is effective to achieve the modern award's purpose, and not only what is necessary.  If it's not in a particular circumstance such as this, that it will not be effective to achieve that outcome, desirable as that outcome might be, in this particular case, then my submission should be implemented.  But I don't want to go around that any further.


I gather from the way in which that narrow question was earlier put to him by your Honour, the Vice President that that that is the core of the issue that is under consideration and that is the question of whether in the case of meat processing establishments, there is a case to be made for allowing casual employees to apply for the form of employment.


VICE PRESIDENT HATCHER:  I know it wasn't your primary position, but I took from the clause in your latest submission, note the application of the model clause outside of meat processing establishments, was not an unreasonable proposition.


MR HERBERT:  A fall back position.  Well, it's the position which is the best that the AMIC believes can be done in the circumstances of the other employees other than the meat processing employees, in the event that our primary position is not accepted.  We put it carefully along those lines.  The distinction of accepting employees of the establishments engaged in retail and wholesale sales of fresh meat and meat products and ancillary productions, those employees are, throughout the award, exempted from various other powers and provisions in the meat processing industry.


That is, employees of meat processing establishments engaged in retail and wholesale sales, that's an exemption which exists throughout the award in relation to hours, provisions and other things within the award.  That's why we've put that exemption in, but we - - -


VICE PRESIDENT HATCHER:  How does that connection with casual conversion?


MR HERBERT:  That they are - we've put them in as an exemption from the balance of the meat processing employees for whom we have put no clause.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Sorry, this is sort of a double exemption - a bit confusing.  Are you saying that employees engaged in retail, for example - - -


MR HERBERT:  And wholesale.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Just make it simple - shouldn't be covered by this conversion clause, or they should be?


MR HERBERT:  No, should be, should be.


SENIOR DEPUTY PRESIDENT HAMBERGER:  That's what I thought you meant, but because of the way it's drafted, it could be read either way.


MR HERBERT:  Yes, I'm sorry about that.




VICE PRESIDENT HATCHER:  That should say, 'except for employees of meat processing establishments engaged in...' should it?


MR HERBERT:  Yes, the clause opposed all establishments other than meat processing establishments and then - - -


SENIOR DEPUTY PRESIDENT HAMBERGER:  That is, it should apply to those.


MR HERBERT:  It should apply to those in brackets, because they are treated separately throughout the award from all other employees in meat processing establishments for hours and other conditions.  There are a number of examples where that occurs throughout the award.  The clause that we propose does not apply to meat processing establishments, other than those that we mentioned, those employees, the limited group that we've mentioned, because of course, not all meat processing establishments have such a place, but we have not accepted in the proposed draft clause that that clause has application to the meat processing establishments by and large.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Apart from that, I haven't actually gone through line by line, in your proposed draft clause for the non-meat processing establishments, is there anything different from the model clause?


MR HERBERT:  No.  You don't need to - - -




MR HERBERT:  No, there are no subtleties.  Rather than seek to rewrite in relation to the other facilities, in terms of the matters which again looking at the decision, encourage the Full Bench to make a clause - persuaded the Full Bench to make a clause of this kind, there were none of the factors of daily hire.  Daily hire did not exist and because daily hire didn't exist, that level of vagary of security of employment did not exist and clause 11.4 of course, doesn't apply either in terms of transfer of employment.  Absent those conditions which we say are disqualifying conditions in relation to the meat processing employees, we didn't seek to, as it were, prod the bear in relation to trying to modify this clause, but have gone with the flow in respect of that aspect of the matter.


But we have maintained a position that all of the features we've spoken of, including what we would submit is the very great difficulty, if not the impossibility of identifying which casual employees can apply for what class of employment and how one sets the standard in that regard, because the unions have had three or four attempts at that and failed to come up with a standard which has any precision about it all.  For those reasons then, the meat processing employees, which is everybody other than those in brackets in paragraph (a) in meat processing establishments, all of whom are able to be engaged in daily hire, all of whom to clause 11.4 applies, all of whom who have those characteristics about them, that there should not be a casual conversion clause in the award that applies to them.


One assumes that if the Full Bench is against us in relation to that, that we perhaps might be given an opportunity to comment on anything the Full Bench might draft because the submission we've made in our earlier submissions is that nothing that the union has produced so far, has a reliable way of giving employer in the industry the capacity to understand what it is that their rights and entitlements will be and who will be entitled to apply for what and what the impact on their business might be.  If you don't have that, then the clause will in effect, generate rather than placate disputation in relation to this issue, in my submission.


Unless there's anything further, your Honour, those are our submissions.


VICE PRESIDENT HATCHER:  No, thank you, Mr Herbert.  Anything extremely briefly in reply, Ms Rodgers, because we need to move on.


MS RODGERS:  Thank you very much.  Extremely briefly, the union just wanted to put the point that if there was a temptation on the part of the Full Bench to look at converting automatically just to part time daily hire, instead of daily hire, we say that would be a problematic standpoint.  We're not certain from the questions asked, whether that is in the contemplation, but we would respectfully request a casual conversion clause to have that flexibility to go to daily hire or part time daily hire and not just one or the other.


Thank you.  Does anything arise?




We'll just take a short adjournment to set up for the next matter of about five to 10 minutes.

SHORT ADJOURNMENT����������������������������������������������������������������� [12.10 PM]

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VICE PRESIDENT HATCHER:  Yes, Mr Keats, you appear for the MUA?


MR N KEATS:  With your permission, instructed by Mr Japper of the union.


VICE PRESIDENT HATCHER:  Mr Crilly, you appear for the identified stevedoring employers?


MR S CRILLY:  Yes, your Honour, and seek permission to appear for the first time for Patrick Stevedores Holdings Pty Ltd and Victoria International Container Terminal Ltd.


VICE PRESIDENT HATCHER:  Permission will be granted to the parties to be represented by lawyers for this proceeding.  There's no evidence is there?


MR KEATS:  There is no evidence from the union.


VICE PRESIDENT HATCHER:  Right, so we'll proceed straight to submissions.


MR KEATS:  Yes, there's one submission that was filed by my client on 3 August.  It attempts to grapple with the invitation given by the Commission in the Full Bench decision that adaptation of the clause could be made by parties that were not in the list of 85 awards that the Full Bench had expressed the view that the model clause could be inserted into.


The clause, as you'll see from the submissions we've filed has been modified in three aspects and they require probably a little bit of explanation.  You'll see the clauses in track-changes marked at the back of the submissions at schedule A.  The changes relate to changing part time employee to guaranteed wage employee.  Part time employment to guaranteed wage employment.  I'll deal with that as a single idea.  Then there's the third change which is the change from pattern of hours to number of hours.


If I could first of all start with probably trying to explain what guaranteed wage employment is. You'll see from clause 10.2 of the award that it is a little bit different from part time employment.  The difference is of significance in these proceedings in that it doesn't refer to working set days or set hours on set days, it instead talks about having a guaranteed minimum number of, or average number of shifts each week.


If I could add to that background, when the roller act review occurred to this award in 1999, there was an explanation of guaranteed wage employment.  If I could hand up print R7753 to members of the Bench.  It's a very short extract.  It's found at paragraph 9 of the decision.  The Senior Deputy President extracts part of the evidence of Mr Bill Giddens, he was then the National Industrial Officer of the MUA.  He talks there about how this came historically from a period when there were non-permanent ports when a guaranteed wage structure was required.  He understood that the employers have adopted an historical approach that best fits the needs of the peaks and troughs of the industry.


I might pause there.  We've also referred to in the submissions how that really hasn't changed.  How we've still got an industry with peaks and troughs and a lot of irregular employment.  He talks about there was a need - indeed, a supplementary form of labour used to deal with the peaks and troughs of the industry.  He accepts that, and he also accepts that the hours are unpredictable for guaranteed wage employees.


Mr Bunting who was then appearing for the stevedoring employers, at paragraph 10, accepts of concurs with that summary of what a GB is.


VICE PRESIDENT HATCHER:  It's not necessarily part time in the sense that the average number of hours can be 38 or 35, I think in this case.


MR KEATS:  It's 35 in this particular award, but yes there is no minimum floor.  I think the other important thing for this case is it's not part time work that you work on at a set day of the week, like Monday, and your hours are 10 till five on a Monday.  You don't have that structure.  You have 10 hours a week; you can be called on Monday, you can be called on Sunday.  Next week it could be a Wednesday, next week it could be a Thursday night.


It's a small step up from casual, but it doesn't get all the way to part time by way of explaining how it sort of fits in.  When it's intermediate, it's probably better seen as intermediate between a casual and standard part time rather than between casual all the way up to full time.


VICE PRESIDENT HATCHER:  I only ask that because your 10.4(d) says if you work less than 35 you can request to go to guaranteed wage employment.  Why do you have to work less than 35?


MR KEATS:  As I understood it, that was from the clause that was published in relation to this award.  It should not be less than 35.  You should be working an average of 35, not less than.


VICE PRESIDENT HATCHER:  I'm looking at your 10.4(d).




VICE PRESIDENT HATCHER:  You have in (c), if it's 35 or more you can apply for full time.


MR KEATS:  Correct.


VICE PRESIDENT HATCHER:  In (d), if it's less than 35 you can apply for guaranteed wage employment, but I'm just wondering why does it have to be less than 35?


MR KEATS:  Because that's the full time equivalent under this award.


VICE PRESIDENT HATCHER:  Yes, but the point is that you can have guaranteed wage employment at 35 hours average a week, or more than 35 hours average a week.


MR KEATS:  You could.


VICE PRESIDENT HATCHER:  That is that distinction may not match the employment categories in this award.


MR KEATS:  Yes, that would follow yes.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Just again, looking at your - with guaranteed wage employment, in fact you're not - there's no - your guaranteed minimum wage, not a guaranteed minimum number of hours.  So, you're guaranteed to be paid for a set number of hours.  Is it true that anybody would work a pattern of hours that could have been - that a GWE employee could have been employed for?


MR KEATS:  Yes, there's no flaw, I think is one way of answering your question, but I think the submission put against me is that you could be working 52 shifts in a year and you could still be a GWE.  Similarly, you could be working 52 shifts as a casual and be classified as a casual and there's no a clear distinction under the award, other than engaged and paid as such.  That's the only real distinction between those two sets of categories.


DEPUTY PRESIDENT BULL:  But ordinarily, Mr Keats, the floor is worked out at the enterprise level, isn't it?


MR KEATS:  That's right and if you look at the enterprise agreements, some of which are before you, you will see that they talk about usually a minimum wage being given to a GWE which is then predicated on a minimum of hours that that GWE works.  That's why we've tried to use a number of hours as opposed to a pattern of hours, as the way of breaking up between the different categories of employment.


DEPUTY PRESIDENT BULL:  My understanding is that most enterprise agreements would have a GWE working between 20 and 30 hours a week, or guaranteed, I should say.


MR KEATS:  They would be guaranteed something like 14 shifts a fortnight.  I'm not quite sure how many hours that works out to be.




VICE PRESIDENT HATCHER:  I think the point that's being made is that there must be a number of hours that's so few, that it's not really practical to convert them to guaranteed weekly employment.


MR KEATS:  And that's as the Deputy President said, is worked out at the enterprise level.  There are very few and I can't think of any on my feet, employers that actually work under the award.  Almost everyone is covered by an enterprise agreement.  The enterprise agreements stipulate how many hours or a minimum wage for people that are classified as GWE's.


VICE PRESIDENT HATCHER:  Some of those have carry-forward provisions, don't they?  I remember from another case.  If you have a deficit, you have to carry it forward to the next year.


MR KEATS:  That's right.


DEPUTY PRESIDENT BULL:  The full timer normally works 18, 20 hours a year.


MR KEATS:  That's correct.


DEPUTY PRESIDENT BULL:  The GWE will be stipulated something less than that.


MR KEATS:  Correct.


DEPUTY PRESIDENT BULL:  But as the Vice President's raised, under the award, there's no minimum stipulation of any hours, so why can't a casual say I'm working regularly one hour a week. I want to be guaranteed one hour a week.


MR KEATS:  That would flow from the clause that we've proposed.


DEPUTY PRESIDENT BULL:  But it doesn't seem practical, does it?


MR KEATS:  It is a difficulty that we obviously face in that if there is work for one hour a week for a casual, we say that the casual conversation clause would have the effect that that person would be guarantee one shift a week.


VICE PRESIDENT HATCHER:  I mean you might work one eight hour shift, and I haven't done the math, but be guaranteed 10 minutes an average over the week or something.


MR KEATS:  It is a difficulty that - - -


VICE PRESIDENT HATCHER:  Well, it might be solved if the average in (d), looking at 10.4(d) had a minimum number, an average of more than something per week over a period of 12 months.


DEPUTY PRESIDENT BULL:  But that could be ascertained, Mr Keats, could it not, by just having a look at the industry practice.


MR KEATS:  It could be worked out by looking at what happens at various enterprises and their enterprise agreements, that's correct.  You will find it's a slightly different number for each different enterprise though.


DEPUTY PRESIDENT BULL:  Yes, indeed.  Yes, all right.


MR KEATS:  As I stand on my feet, I don't have instructions to seek a minimum floor in that part of the clause.




MR KEATS:  Indeed, my instructions are relatively limited and don't go much beyond what's in the written submissions that are before you.


DEPUTY PRESIDENT BULL:  Yes, then maybe you can't answer this question Mr Keats, and it's understandable, but do you understand whether stevedores are employed under any other award of the Commission?  I'm referring in particular to the Port Authorities Award, or covered by that award, at least anyway, I should say.


MR KEATS:  The only other awards I am aware of are some of the modern enterprise awards.  I believe there might be one or two there, but otherwise, I'm not aware of any stevedores being employed under any other modern award.


DEPUTY PRESIDENT BULL:  There's a number of port authorities that directly hire their own stevedores and they would be covered, I would suggest, by the Port Authorities Award.


MR KEATS:  But if you're talking Port Authorities or coal export terminals or sugar?


DEPUTY PRESIDENT BULL:  No, no, just the plain Port Authority.


MR KEATS:  There's a specific exclusion for those in the award.




MR KEATS:  There's a specific exclusion in relation to employers that are otherwise covered by Port Authorities, coal export terminals award or sugar in 4.1 of the award.


DEPUTY PRESIDENT BULL:  The casual conversion clause that the Full Bench has determined so far applies to the Port Authorities which in some Port Authorities, directly employ their own stevedores.  Fremantle, Broome, Esperance, Bunbury, from my knowledge, at least do.  Anyway, the reason I ask is you probably don't have any instructions to how we - because we haven't heard from the Port Authorities how this proposed clause would affect them, because they don't have guaranteed wage employment in that award.


MR KEATS:  No they don't.


DEPUTY PRESIDENT BULL:  But they do have it in their enterprise agreements.


MR KEATS:  I'm not in a position unfortunately, to assist you Deputy President.


DEPUTY PRESIDENT BULL:  That's fair enough.


MR KEATS:  Indeed, beyond pointing to the balance of what's in the submissions, the extent of my instructions are to rely upon what's contained in them, and otherwise leave it to the Full Bench.


VICE PRESIDENT HATCHER:  Thank you.  Mr Crilly.


MR CRILLY:  I will endeavour to be brief.  Our clients collectively operate the majority of Australia's container stevedoring terminals and a large proportion of its bulk and general stevedoring operations.  So, there is an obvious interest here in the form or existence of any casual conversion mechanism in this award.  Previously, DP World and Qube have been involved in these proceedings and have put on evidence and submissions.  That stevedoring employers' group, if you like, has now expanded to include Patrick Terminals and Victal in Victoria.


Our clients have put on themselves, relatively concise written submissions in response to the original invitation in the Full Bench's decision of July last year and subject to any assistance which I can provide the Commission in relation to those matters, I propose to rely on them and imply address the matter in relation to which we sought the opportunity to be heard orally, which was to address any submissions by another party.




MR CRILLY:  That being the case, we move to the MUA proposal.  In substance, it is simply the model clause which was set out by the Full Bench in that July decision with the changes to which my friend has referred.  At the outset, we would note that the MUA proposal is reproducing a model which your Honours accepted in that decision was not necessarily suited to this award.


The way it seeks to grapple with that, is the substitution of the word number of hours for pattern of hours in, if you like, the criterion of eligibility which tells you who is a regular casual employee who is entitled to seek conversion.  What the change is grappling with at an industry level rather than just at the text of the award, is that many people in this industry do work on an irregular basis for reasons about which Mr Greg Nugent and Mr Greg Muscat gave evidence in the proceeding earlier.  I don't anticipate that there was any dispute, that there is a great deal of irregular work which is based on seasonal variation changes in shipping schedules, delay, weather, et cetera.


There are a few important aspects of guaranteed wage employment under this award, that notwithstanding my friend's summary, which we accept, I would like to draw your Honour's attention to - those are under clause 10.2 of the award, of which I have copies, but I apprehend that your Honour's probably have the document.




MR CRILLY:  Firstly, a guaranteed wage employee is entitled to a minimum number or an average number of shifts per week, or equivalent payment in lieu of that engagement.  To pause there, to take up a point made by your Honour, Hamberger SDP, it does not in fact guarantee the availability of work, only payment.  Second, there is no specified period of maximum period over which hours could be averaged, so it permits very flexible arrangements which are, in many respects appropriate to this industry.


Of less concern is the basis on which employees accrue their leave under the NES based on actual hours worked, rather than the guarantee.  In other words, what a guaranteed wage employee is entitled to is a floor of payment which is based on a number of shifts which it is likely anticipated they will work on average, so there is component of regularity to that engagement in theory, which may not eventuate in practice.  But the concept also contemplates them working them any number really, of additional hours on a fully regular basis for which they will be paid.


I think I had proposed to address something that said in the submissions about guarantee wage employment being a form of part time employment, I think my friend's oral submissions have backed away from that somewhat.  We respectfully adopt what your Honour said in the July decision, which is that it is a unique intermediate category of employment; unique to this award, and intermediate in the sense that it has features of both casual and part time employment.


But what it lacks of part time employment are those important characteristics your Honour has identified in around paragraph 93 to 97 which, without quoting any of the authorities, I think are uncontroversial requirement for written number of agreement, as to the number of hours, times of days on which they are to be worked, variation by agreement only, which made that form of employment suited to particular demographics, as the test case has explained.


VICE PRESIDENT HATCHER:  I think we said somewhere in this decision - I'm not sure where, that a more flexible model of employment under the award, the easier casual conversion becomes.  That is, these are sort of arguments in favour of casual conversion, rather than against it.


MR CRILLY:  In one sense yes, I accept that, your Honour.  What we say though, we do not take it that the Bench had intended that virtually any casual might be able to convert. There were criteria which they would have to meet, one of which was a regular working pattern, and that was described in another paragraph as the decision is the essence of the casual conversion concept.  It may be that that paradigm simply has no application to this award, in which case, I won't harp on about it.  But we note at the outset that this proposal now based on a number of hours is quite different to what was brought up in that decision.


While it's true that the more liberal - the form of the part time employment clause in an award, the easier it would be for someone to obtain the right to request conversion, we don't apprehend that it was intended to be writ at large.  In other words, the basis in which the clause was always proposed by the ACTU was to capture people, if you like, who weren't necessarily true casuals, not that we would accept that characterisation, and indeed, the Bench didn't.


I take on board what your Honour has said about those observations about guaranteed wage employment, but they are important in understanding precisely what it is that the MUA proposal would do.  Because central to that proposal, as set out in clause 10.4 of the draft determination, is that a regular casual employer plea, is not necessarily one whose worked hours with any regularity.  It's merely one who has worked a number of hours on an ongoing basis which could, with that significant adjustment, be worked as a GWE.


As I've said, the nature of GWE employment is extremely flexible.  One can work virtually any number of hours over a period of averaging that could be 12 months or for that matter, longer, because the clause simply doesn't limit it.  On that basis, there are myriad different arrangements which could fall within that.  One in fact, struggles to think of one that would not, including because, as I've noted, the guarantee doesn't actually guarantee the availability of work.  It could be said a number of hours which is less than any putative guarantee is still consistent with that working arrangement.  So, there are a number of issues here.


I won't stretch at too much length the departure from what we say are the principles which underlay this decision, because this award is in many respects, unusual.  But, what we say is that that decision set out a clear test in relation to the awards which have orthodox part time employment provisions as to which casual employees would be eligible. It is those who worked a pattern of hours which could have been worked perhaps with minor adjustment under the terms of the part time provisions.


Now, if one is to propose a different basis on which an employee is to convert, that is a different thing altogether in that we say it's a different case which again, without repeating the authorities that your Honours have heard ad nauseum, there has been no evidence or submissions in support of.  The case has, at all times, been for one that was based on the right of regular casuals to convert.


That is not necessarily fatal, but one needs to determine what is the basis on which you should decide whether an employee is or is not eligible to convert.  We say that has not been done because the flexibility of guarantee wage employment coupled with the notion that merely working a number of hours, that could have been worked as a guaranteed wage employee, entitles virtually anyone with 12 months service to convert.


VICE PRESIDENT HATCHER:  What if we had provision, obviously the 12 months is a given, but then specify a minimum average number of hours to be eligible for conversion?


MR CRILLY:  That provision would overcome this problem, your Honour.  There are others to which I will come.  The only other observation I would make about that, is that there would need to be evidence about industry practice so that the Bench could determine on the merits what is an appropriate number.


VICE PRESIDENT HATCHER:  We could, for example, look at enterprise agreement to see what sort of numbers they use as a guide to industry practice.


MR CRILLY:  You could, your Honour.  What the enterprise agreements which cover my clients and I understand the other major players though, Hutchison, Lukes and Flinders in Adelaide do, is set a minimum salary, rather than a number of shifts.  Of course, the value of a shift will depend on the penalty rate regime which is significant in and industry where almost everyone is a shift worker and the penalty rates are up to, I think, triple time and a half, for some public holiday work.


One would need to undertake some kind of analysis to convert those numbers into hours as it's not necessarily expressed in terms of shifts per week.  But, at a more general level, I accept what your Honour is saying.


That brings me I think to the other problems that I've mentioned with this clause, which relate to substituting in the number of hours as opposed to a pattern of hours in this award.  Without speaking at too much length, I think there are largely three.  How do you determine who is eligible to convert?  How do you determine if they've made the request for a conversion, what the guarantee should actually be?  Three, some more mechanical aspects about the right to refuse and what the reasons for doing that might be.


We say that by adopting this different criterion of eligibility to convert, namely the number of hours worked, rather than a pattern, but without changing the rest of the clause, what is proposed by the MUA is ill-adapted to this award.  As to who is eligible to request conversion, the first thing that stands out is that the clause speaks in terms of a number of hours which are worked, whereas clause 10.2 deals with shifts per week.  That may seem like nit-picking, except that there are variable shift lengths throughout the industry and indeed, under this award, clause 18.14(b)(ii), contemplates shift of some duration other than seven hours by agreement.


VICE PRESIDENT HATCHER:  So, where it refers to full shifts, is that a defined term?


MR CRILLY:  No, your Honour.


VICE PRESIDENT HATCHER:  What does that mean?


MR CRILLY:  That is an open question.  On one view, it would mean that one cannot have a guarantee of half a shift.  On another however, the averaging arrangements would let one remedy that by providing full shifts to employees who are nonetheless, guaranteed something less than that on a single day.  It is not a matter to which I've given any significant thought and I apologise to your Honours for that.


What I would come to next though, is how one would - this is linked to how one calculates a guarantee that a person should receive based on the number of hours which they worked in the previous year.  How one takes a number of hours worked over 12 months and says well, this is what the guarantee should be.  The difficulty there, besides that one is not going to get a round number doing that calculation, is that as I've said, guaranteed wage employment contemplates a kind of regular base of X shifts per week.  But these employees can and do work additional shifts in return for payment for time worked.


There is a question as to whether one looking at the number of hours that was worked over the previous 12 months is to assume that all of those were part of - sure to be part of a guarantee or whether some allowance should be made for there being a base line which is supplemented from time to time.  That is a significant difficulty we submit, your Honours, in light of the evidence in particular which was given by Mr Nugent about the seasonality of the work that's involved in - particularly involved in general stevedoring.  Mr Muscat also indicated that there are peak periods in the summer for container stevedoring.


SENIOR DEPUTY PRESIDENT HAMBERGER:  I know it's difficult because nobody actually works under the award, but with guaranteed wage employment, so the assumption is you're going to work every week, some work every week, or not?


MR CRILLY:  That might be an assumption in the ordinary course that may not eventuate in some weeks.  One could speculate that in a metropolitan container port that is very likely, whereas in a regional port which takes primary produce and is very busy for some months and not for others, one may have to lean higher on the averaging arrangements.




MR CRILLY:  To take a hypothetical, one could have an employee who works fairly sporadically throughout the year at one of these smaller ports, but during a peak season, works very frequently and so works the vast bulk of their shifts across a few months.  When one comes to consider, assuming they're eligible to request conversion, what that guarantee should be, does one simply smooth it all out and assume that they should have a guarantee throughout the year which entitles them to the higher payment?  Or does one take a lower number and when they work additional hours, so be it?


These are real difficulties that we're talking about.


SENIOR DEPUTY PRESIDENT HAMBERGER:  What if you had a clause - just off the top of my head, that said to be eligible to convert, you have to have worked over a 12 month period a minimum number of shifts every week, or over 48 weeks or something like that.  The shift might only be one, but you work every week.


MR CRILLY:  A clause of that kind, your Honour, I would think take you back closer to what the Full Bench originally determined and would avoid some of these issues, not necessarily all of them.  But you could still have issues with what the guarantee should be, but it would mean that people who have worked the vast bulk of their hours required for conversion sporadically or over a short period to meet seasonal peaks or some unexpected circumstance, would potentially be excluded, so it would address that point.


The only other thing I would say about the setting of the guarantee is that the language used is that they are entitled to request conversion, to guaranteed wage employment which is consistent with the hours work.  Whereas, we have said the fact of firstly the guaranteed wage employment doesn't actually guarantee you any work and secondly, that you have the issue of working hours additional to the guarantee from time to time, means that a lot of different guarantees could actually be consistent with a particular number of hours which were worked in the previous year.


That your Honours, links as well, to some of the more mechanical concerns that our clients have.  The first is that when one looks at the remainder of this clause, your options really, when you receive a request for conversion are to accept it or decline it.  There is no mechanism to work out any dispute about what the guarantee should be.  That is not a problem which would likely arise on the application of the clause your Honours determined under more orthodox part time employment provisions because one simply translates the pattern.


In this instance however, you might say well, we accept that you've worked regularly and done all these things and that's great but actually we think instead of three shifts a week, the guarantee should be two, and there's no mechanism to deal with that.  I accept that that is likely a drafting issue which could be dealt with.


The other is that the clause provides for the declining of a request on reasonable grounds and does not limit what those grounds are.  But, it does provide examples from which a Tribunal or a person interpreting this award might take some flavour of the sorts of circumstances that would be reasonable reasons to decline a request.


Those matters, with the exception of the employee not actually being eligible to convert or relate to matters which are known or reasonably foreseeable to the employer which creates something of an issue where workloads are extremely difficult to foresee.  In effect, it means that because an employer is unable to foresee whether there will or will not be the need for that work, such that the person should be converted, it has to assume that there will.


Again, I will not make too much of that, because those are examples, but it might be that if a clause of this kind were inserted, which is not our primary position but we address it in any case, that those perhaps should be looked at.


What we are left with then, is a clause which we say is confusing and likely unworkable in its present form for the employer who would be required to apply it.  Ultimately perhaps on pain of exposure to civil penalties, for wrongly declining a request, notwithstanding that there's the alternative avenue of arbitration in the Commission by consent.  But we say that this is based on a different basis to the case in its great length up to date and that the case hasn't been made for the adoption, this criterion based simply on a number of hours.


So, the Commission's more general determination, we say shouldn't carry the day, in relation at least to these details.  Our clients urge the Commission not to adopt the MUA proposal.


Unless I can assist the Commission further, those are the submissions.


VICE PRESIDENT HATCHER:  Just one matter.  Even with the model clause of part time employment, the fact that, for example, the part timer might have regularly worked say 25 hours a week, the clause doesn't require if the request is granted that the part time employment that's offered, being 25 hours a week, that's the matter about which in (i) the employer and employee must discuss and record in writing.  Then the dispute procedure applies if there's an issue.


By analogy, if say the casual here had worked say 104 shifts in a year, and say we draft a clause which made that person eligible to apply, it doesn't necessarily mean that the conversion would be to 104 shifts a year.  It might be, as you say, something less than that with some buffer.


MR CRILLY:  I may have to retreat from my submission slightly and say that that may provide a mechanism by which this can be dealt with.  There is still, in my submission, a greater difficulty in this case as to how you would resolve that conflict.  The reason is that in your orthodox situation of someone under - call it the Clerks Award, seeking to convert to part time employment, one would look at what they have done consistently throughout the year that could be converted easily to a part time arrangement and it might be very clear that where there is variation from time to time, that that is anomalous and in a like situation where they were a part time employee, would have been worked as overtime.


That may not be as clear here, given the long periods of averaging and your peaks and troughs, to use my friend's words, that we're talking about.  But I accept the point made by your Honour to the extent that that might provide the mechanism by which these things could be ventilated.




DEPUTY PRESIDENT BULL:  Mr Crilly, in your written submissions at least you say that there are a number of enterprise specific casual conversion clauses, but you say they can't be related to the award - they're too bespoke.




DEPUTY PRESIDENT BULL:  But you haven't provided any - unlike the MUA at least, you haven't provided any suggested draft casual conversion clause.  Is that because you say it's impossible, or you just oppose it in principle?


MR CRILLY:  Well, we maintain our primary position that we oppose it in principle.  We accept that that is not likely enough, given the basis on which the Full Bench determined that it was necessary to provide some casuals with access to the NES in order to properly achieve the modern award's objective.  But we say any clause which goes in has to balance the interests of employers and employees and has to work mechanically rather than just create problem.  We can't see a way of doing that.




VICE PRESIDENT HATCHER:  Thank you Mr Crilly.  Anything in reply Mr Keats?


MR KEATS:  No, your Honour.


VICE PRESIDENT HATCHER:  All right.  We thank the parties for submissions.  We will now adjourn and resume at 2 o'clock.

LUNCHEON ADJOURNMENT���������������������������������������������������������� [1.00 PM]

RESUMED���������������������������������������������������������������������������������������������� [2.02 PM]


VICE PRESIDENT HATCHER:  I will take the appearances.  Mr Britt, you appear for the Local Government Association.


MR BRITT:  I do, your Honour, and I have with me Ms Rook from the association.


VICE PRESIDENT HATCHER:  In our decision of 24 November 2017 the purpose of this hearing was for the Local Government Association to make submissions about the minimum casual period for casual employees.


MR BRITT:  I understand that.  On 2 August 2017, in accordance with the directions made following the substantial decision, we filed an outline of submissions that dealt with both casual conversion and a two-hour minimum, and the first of those matters never seems to have been determined.


VICE PRESIDENT HATCHER:  No, we still have to determine that, but the question was whether - the parties were meant to advise whether they required a further oral hearing.  Our decision of 24 November 2017 indicated that no party had requested a further oral hearing in relation to casual conversion.  That is, we would determine those issues which we still have to determine on the basis of the written submissions.


MR BRITT:  And that's true.  To be quite frank, we should have said something, and said something earlier.


VICE PRESIDENT HATCHER:  The only difficulty is I think it means that no one who might be on the other side would have anticipated that there's a hearing today about casual conversion, which is probably why no one is here.


MR BRITT:  That may well be the case.  I can't quibble with that.  We decided to put the submission on and file it, albeit yesterday, to allow people to have some understanding of the issue.  They would have had or should have had copies of our original submission where the issue as to whether as a matter of discretion such a casual conversion clause should exist in the local government sector, given the various state government requirements in relation to employment.


But I'm not quibbling with your Honour's assessment that there may well be people who have a legitimate interest in this matter who aren't daily following what's filed in the Commission and haven't realised that there's perhaps a more substantial issue in respect of that matter.


VICE PRESIDENT HATCHER:  You perceive - I think what it will mean is that we will have to write to other parties and give them an opportunity to respond.


MR BRITT:  I'm happy to do that.  I'm also happy - I hear what your Honour's saying - whether it makes more sense for the matter to be adjourned and there be a proper hearing.




MR BRITT:  I thank your Honour for that.  Your Honours, we rely upon the outline of the submissions that we have filed, both on 7 August and yesterday.  You will see when you consider the submissions of - sorry, 2 August - you will see when you consider those submissions that they dealt with (1) the issue of a minimum period of engagement for casuals; as well as whether, as a matter of discretion, the Local Government Award should include a casual conversion clause.


If you peruse our submissions of yesterday, in relation to that first matter, we have abandoned any claim or any attempt to move away from the two-hour minimum stay.  That's no longer a matter that we seek to challenge.  In relation to the submissions that were filed yesterday, they deal now exclusively with the issue of casual conversion.


The first of those arguments deals with jurisdiction; that is whether it is possible for the Commission to include a casual conversion clause in the Local Government Award in light of the legislation that exists in Victoria, West Australia and the Northern Territory.  Broadly put, as outlined in the submissions, it turns on the Melbourne Corporation point that we have dealt with in the submissions.


We freely concede that of course the Melbourne Corporation point does not apply to employment in the Northern Territory because the Northern Territory is not a state.  That causes then other difficulties for the Commission, given the terms of section 154 of the Act, which would prohibit a clause being included in the modern award at this time that only applies to the Northern Territory.


So although the Northern Territory is not, we freely concede - employment by local government in the Northern Territory is not, as we freely concede, governed by the terms of the jurisdictional restriction as found in Melbourne Corporation.  Section 154 prohibits the Commission from making a provision that is, by reference to a particular territory as well as a state.


As we've set out in our submissions, the various pieces of legislation in both Victoria, West Australia and the Northern Territory require local government entities to employ people based on particular matters and in accordance with particular principles.  We've set out the relevant provisions on which we rely at paragraphs 8 through to 11 of our submissions.


VICE PRESIDENT HATCHER:  Do all those provisions, when they talk about employing persons, include employing them as casual employees?


MR BRITT:  They do, but we would say that when it comes to employing a person on merit in a permanent role, that's another decision as to employment.  That is, employing a person as a casual then employing them as a permanent employee.  And in essence the current proposed model casual conversion clause requires us to employ particular casuals, in the broad, who meet the requirements, unless there are good business reasons not to do so.


We say that at that time we are also required to consider the merit.  That is, if there is work being done and a permanent position is being proposed, any form of merit selectin requires a merit selection at that point as well; and a comparison between who else may be available to fill what has become a substantial position.  We also freely concede that over time - - -


VICE PRESIDENT HATCHER:  Do these provisions require competitive selection?


MR BRITT:  No, they require merit selection.


VICE PRESIDENT HATCHER:  Why would we not proceed on the basis that somebody who has done the work as a casual for 12 months or more on a presumably satisfactory basis has the merit to do it?


MR BRITT:  They may or may not have the merit to do it.  That is, they were engaged as a casual, with what that type of employment allows an employer to roster a person, et cetera; and now we're being required to permanently employ them for ever and a day.  There isn't a decision at that time that that person has sufficient merit to hold such a position.


DEPUTY PRESIDENT KOVACIC:  But engagement as a casual may be preceded by some merit selection process.


MR BRITT:  It may in some circumstances, but it may also be a different merit selection process that you would engage a casual on as distinct from a person who will be permanently employed within your organisation in what then becomes a permanent position.


SENIOR DEPUTY PRESIDENT HAMBERGER:  So just to be clear, is it required to appoint people as casuals on merit?  I mean, are they covered by the requirement to employ people on merit?


MR BRITT:  In relation to the - - -


SENIOR DEPUTY PRESIDENT HAMBERGER:  Is there an exclusion, sorry?


MR BRITT:  In relation to the states that are covered by the Local Government Award, there is no difference, and merit selection is required at casual employment too.  Other states that are outside the purview of the modern award and remain in their state systems, some of those, casual employment is not required to be dealt with by way of merit, but these ones are.  That is conceded.


VICE PRESIDENT HATCHER:  So say you were a swimming pool attendant and you've worked a pattern of hours over 12 months which makes you eligible for conversion to, say, part-time employment, what's the new merit element which wasn't covered by the original merit selection?


MR BRITT:  You are now then looking at not just engaging a person on a casual basis, but putting them permanently on the roster, and that becomes a continuing position as distinct from a casual position.


VICE PRESIDENT HATCHER:  Yes.  What's the answer to my question?  What's the difference in merit required for that?


MR BRITT:  The difference is that putting a person in relation to a permanent employment, you may well be looking at other factors that weren't present when they were employed as a casual.




MR BRITT:  It may well be their skills, their skill mix, whether they fit in with the long-term needs of - I think you said the pool - the pool.


VICE PRESIDENT HATCHER:  They're all matters which could be taken into account as to whether there's a reasonable ground for refusal.  For example, if you have no long-term need for the person that fits within the grounds, if they don't have the right skills that fits within the grounds; that is, the grounds of reasonable objection aren't closed, and the model clause as drafted applies to accommodate all those possibilities.


MR BRITT:  I think to some extent we've dealt with that in perhaps an alternative position, but I think you will probably find right at the very end of our submissions that if such a clause was to be included, we would be seeking to have a recognition of the ability to exclude a person from casual conversion based upon the relevant state statutory requirements.


To date we've focused upon employing particular individuals.  When one looks at some of the legislation, in particular Northern Territory legislation, that people are to be employed in accordance with a staffing plan.  That is, there are limits upon the number of employees that can be employed.  That's not recognised in the proposed business grounds.


VICE PRESIDENT HATCHER:  Have you got an actual proposal - a drafted proposal?


MR BRITT:  We don't.


VICE PRESIDENT HATCHER:  If there's an actual drafting proposal you have, can I invite you to file something that we can actually look at.


MR BRITT:  We can do that.  Can we have 4 pm on Monday?




MR BRITT:  What we say is in essence for the reasons set out in our submissions, that the proposed clause does offend the principles in Melbourne Corporation.  We recognise that there has been some reflection on those principles, and perhaps that's best summarised in the United Fire Unions case that we've dealt with in our submissions, but at no stage has there been any overruling of the decisions in Re Australian Education Union ex parte State of Victoria.


In essence what the current award proposal requires us to do, in essence provides a mechanism that identifies the persons that we have to employ in a permanent capacity and determines the number of persons that we have to employ in such a capacity, subject to meeting the business grounds.  And that's how it offends, we say, the jurisdictional restriction that operates in relation to Commission's powers.


Secondly we say that there are good reasons for not including such a clause, based upon the various state requirements dealing with Victoria, West Australia and the Northern Territory, and that is their legislative requirements in respect of employment in their local government.  None of the other industries which are caught by the model conversion clause - our understanding being the federal employment awards are not covered by that decision - have such legislative basis dealing with selection for employment.


VICE PRESIDENT HATCHER:  You've referred to the secure employment test case in paragraph 27.  What happened, if anything, to the Local Government Award after that?


MR BRITT:  Casual conversion was not included.  I will also say, your Honour, it wasn't included ultimately at the end of the day by agreement.  There were subsequent hearings in relation to state government employment, and they were not also included.


VICE PRESIDENT HATCHER:  That was because the Industrial Relations Act New South Wales was relevantly subject to the Public Sector Employment Management Act.


MR BRITT:  Of course.  And we fully concede that's not the case here.  If there's no jurisdictional impediment you can quite clearly, by a federal award, override the state acts.  We're not suggesting to the contrary.  We're saying that given their presence, as a matter of discretion, employment in local government should be left as it is in relation to the selection of employees.


VICE PRESIDENT HATCHER:  I'm just thinking through the Melbourne Corporation point.  Given that you can object on reasonable grounds, does the Melbourne Corporation protect the right of the state to do things on unreasonable grounds?


MR BRITT:  The short answer is I think it does.  Whether something - I withdraw that.  I think the short answer is yes, it does.  You don't look at the action of the state, you look at the impact on the state.  And in essence we say that the types of matters that are found at paragraph 24 take the Local Government Award outside the common matters that were considered by this Commission when it made its primary decision.


These are matters which are separate and distinct to local government and quite clearly are not in common with the rest of the awards that were pursued by the industrial parties.  One would say that there must be some good reason for the state - or the states and territories seeking to legislate in relation to those matters at paragraph 24.


VICE PRESIDENT HATCHER:  They're really anti-corruption provisions, aren't they?


MR BRITT:  To be quite frank, your Honour, I went looking for something that said that in some second reading speech or some explanatory memorandum and I couldn't find it, but I don't quibble with that assessment; whether it's anti-corruption and also anti-nepotism, one could readily see that being the case.  And assuming that is the case, the modern award clause would allow perhaps a backdoor entry into permanent employment where those principles have not been applied.


SENIOR DEPUTY PRESIDENT HAMBERGER:  That's why I asked whether merit was applicable to casual employment.


MR BRITT:  It is.  There's nothing in the pieces of legislation that excludes the employment of casuals.


SENIOR DEPUTY PRESIDENT HAMBERGER:  Just I know in the NPS my recollection is that you could appoint somebody on a casual basis and there was no - the requirements normally for merit didn't apply, or certainly were less rigorous; and then he then converted them to a permanent employment.  There was a way of getting around it.


MR BRITT:  That may also be true in local government as well.


SENIOR DEPUTY PRESIDENT HAMBERGER:  I'm assuming there is no definition of merit anywhere.




SENIOR DEPUTY PRESIDENT HAMBERGER:  What it requires; I mean not in the legislation.




SENIOR DEPUTY PRESIDENT HAMBERGER:  I'm presuming there are documents that seek to give effect to these.


MR BRITT:  So unless there are any questions from the Bench, that's all I wish to say today.


DEPUTY PRESIDENT BULL:  You say, Mr Britt, you've dropped the two-hour minimum - - -


MR BRITT:  We were going to run for one hour and we've abandoned that and we can live with the two hours that the Commission determined was the appropriate minimum standard.


DEPUTY PRESIDENT BULL:  I was just making the point - or trying to make the point - you made the observation that as you had there's no evidence, that's one of the reasons why you were pursuing it.  But I don't recall you raise this point previously, unless was asleep.


MR BRITT:  The Melbourne Corporation?




MR BRITT:  No, we didn't.  We raised as a matter of discretion that the casual conversion clause shouldn't apply, but we didn't raise that.  I thought I might have made that - if I didn't make that clear at the beginning, I apologise.


VICE PRESIDENT HATCHER:  Mr Britt, do you want to tender the two witness statements that were filed?


MR BRITT:  I do.  And we have a folder of material that refers to all the legislation and the cases which I was going to hand up.


VICE PRESIDENT HATCHER:  Let me deal with the statements first.  The statement of Robert Spence dated 21 December 2017 will be marked exhibit LGA1; and the statement of Anthony Brown dated 16 January 2018 will be marked exhibit LGA2.




MR BRITT:  Thank you, your Honour.  I apologise for burdening you with so much paper, but perhaps for the sake of convenience the decisions and the relevant extracts were put in a folder, and if I could provide a copy either now or once you adjourn ‑ ‑ ‑


VICE PRESIDENT HATCHER:  Is the USU case in that bundle?


MR BRITT:  Yes, it is.


VICE PRESIDENT HATCHER:  You can hand it up now.


MR BRITT:  You will find that decision, your Honour, behind tab 4.  We've attempted to make the task of going through that slightly less burdensome by referring in our submissions to respective paragraphs, but clearly that doesn't limit the Commission from reading the entire decisions.


VICE PRESIDENT HATCHER:  No.  All right.  Is there anything further, Mr Britt?


MR BRITT:  No, your Honour.


SENIOR DEPUTY PRESIDENT HAMBERGER:  You will send us a proposed clause that's consistent with the approach - your secondary position you outlined in paragraph 29.


MR BRITT:  Probably our third position.  You know, we've ‑ ‑ ‑


SENIOR DEPUTY PRESIDENT HAMBERGER:  Nevertheless, something that would give effect to the fall-back position in paragraph ‑ ‑ ‑


MR BRITT:  We've adopted the German defence in relation to the First World War on the Somme:  if you get over the first line, then there's a second line; and then finally we have a third line.  In relation to the third line we will give you a proposed award variation in relation to that matter.


VICE PRESIDENT HATCHER:  Thank you for your submissions.  We will now adjourn.

ADJOURNED INDEFINITELY���������������������������������������������������������� [2.26 PM]



GRAHAM RICHARD SMITH, SWORN............................................................ PN22

EXAMINATION-IN-CHIEF BY MS RODGERS.............................................. PN22



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