PN1

JUSTICE ROSS: Good morning. Could I have the appearances please.

PN2

MR Z DUNCALFE: If the Commission pleases, Duncalfe, initial Z for the Australian Workers' Union and with me I have Ackerman, initial C.

PN3

JUSTICE ROSS: Thanks, Mr Duncalfe.

PN4

MR V LIN: If it pleases the Commission Lin, initial V for the Australian Federation of Employees and Industries.

PN5

JUSTICE ROSS: Thank you, Mr Lin.

PN6

We caused to be published yesterday, a background paper which was intended to facilitate the hearing today. It sets out the background to the present proceedings and also summarises the submissions put in by the parties. So, this morning's oral hearing is an opportunity for each of the parties to provide any corrections to the background paper if you think we've mischaracterised what you've said and to say anything by way of short supplementation or anything you wish to say in response to the submission put by the other party.

PN7

Mr Duncalfe - and don't feel compelled to add anything. If you're content with the background paper and you're content for the issue to be dealt with accordingly then that's fine too, but this is your opportunity to say something.

PN8

MR DUNCALFE: Thank you, your Honour. From the perspective of the Australian Workers' Union, the background paper is accurate. We rely on our submissions to date. We feel we have addressed all of the responses or the positions that the AFEI have put. We feel that we have also put our case fairly plainly. We're here to answer any questions if there's any clarification that any of the members of the Full Bench would like to seek on any of our submissions or our positions, interpretations, anything. We're ready to answer those, but aside from that, we're quite happy to rely on our written submissions.

PN9

JUSTICE ROSS: Well, speaking for myself, in your submission in reply of 22 November, you there - from paragraphs 11 on, deal with the Victorian Award issue. Can I just - because I'm going to ask you Mr Lim, to respond to this aspect of the AWU submission.

PN10

This seems to be a - you're putting a construction argument, based on the pre-modernised, pre-reform - however one wants to frame it, but the former Victorian Award. As I understand your submission, you say that well, whilst it doesn't say it in terms that the leading hand is paid on the taking of annual leave, nevertheless, that's how it works. Is that the essence of it? If it is, can I just get you to take me through the argument?

PN11

MR DUNCALFE: Absolutely, your Honour. I'll just get the award.

PN12

JUSTICE ROSS: Sure.

PN13

Basically, it's a differentiation between what is payable on annual leave to the employee and what the 17.5 per cent loading is calculated on. I see. That's the argument. Sorry to interrupt, but I just want to make sure I understand it. So, clause 23.2 of the Victorian Award, it's that bit on page 4, at the top of page 4 of your submission.

PN14

The pay rate for annual leave is the - and you emphasise this, the employee's pay rate at the time they take annual leave. It's the differentiation between that language, their pay rate at the time they take annual leave and 17.5 per cent of the rates prescribed in the award for the classification.

PN15

MR DUNCALFE: That's correct.

PN16

JUSTICE ROSS: So, in other words, the 17.5 per cent applies to their minimum classification rate and the amount they get - say they take four weeks' leave, the amount they get for that four weeks is their pay rate. The difference between pay rate and classification rate is that you say that pay rate encompasses the leave loading.

PN17

MR DUNCALFE: Correct.

PN18

JUSTICE ROSS: Sorry, the leading hand payment.

PN19

MR DUNCALFE: That is correct, your Honour, yes.

PN20

JUSTICE ROSS: Have you got a copy of the Victorian Award there?

PN21

MR DUNCALFE: I do, your Honour.

PN22

JUSTICE ROSS: Do you mind if I have a look at that, or actually, take it from you, would be a better way of putting it. Thanks.

PN23

So, it deals with - I'm just trying to see if there are any other indications that might help us. Sometimes the prescription of what's paid on overtime can also assist. That's 21 - yes. So, there's no express statement to the effect that, well, any of the allowances, whether leading hand or anything else are payable for all purposes.

PN24

MR DUNCALFE: No, your Honour, no.

PN25

JUSTICE ROSS: But the essence of your argument is to point to clause 23.2 and the difference in the language used to describe the pay rate for annual leave versus the 17.5 per cent.

PN26

MR DUNCALFE: That's correct, your Honour. We believe there has to be something for that differentiation; some work for it to do.

PN27

JUSTICE ROSS: Yes.

PN28

MR DUNCALFE: In the alternative, if the Victorian Award itself, if our construction argument isn't accepted by the Full Bench, we do note that the other six or other five pre-modern awards that were used to inform the Pest Control Industry Award, did provide for payment of leading hand allowance on annual leave. Of those three, are explicitly stated and the other three, including the Victorian Award are implied in different variations. Some stronger than others.

PN29

I would contend that the Victorian Award, the implication is probably the weakest, even though we do contend that the implication is there for that payment to be received while on annual leave.

PN30

JUSTICE ROSS: Thank you, I'll give you that back.

PN31

Any other questions for the AWU?

PN32

COMMISSIONER LEE: Not from me?

PN33

JUSTICE ROSS: No?

PN34

DEPUTY PRESIDENT MASSON: Deputy President Masson here. Mr Duncalfe, did the union consider or examine any of the background to the making of the award in terms of submissions that were made by the various parties in relation to this issue at the time the modern award was made?

PN35

MR DUNCALFE: Deputy President, we could not find any submissions on the addition of an industry allowance or any submissions on the removal of the leading hand allowance on annual leave. We didn't go through and look at all of the draft awards provided by all parties. We focussed mainly on the industry award not being part of any of these pre-modern awards and why. Its appearance seems to be inexplicable, but we could not find any submissions that related to the leading hand allowance being payable on annual leave.

PN36

DEPUTY PRESIDENT MASSON: I'm just curious as to why it wasn't picked up at the time.

PN37

MR DUNCALFE: As are we, Deputy President.

PN38

DEPUTY PRESIDENT MASSON: Sorry?

PN39

MR DUNCALFE: As are we confused as to why it wasn't picked up at the time.

PN40

DEPUTY PRESIDENT MASSON: All right, thank you.

PN41

JUSTICE ROSS: Just from what you've put, there is no industry allowance in any of the pre-reform awards?

PN42

MR DUNCALFE: No, your Honour.

PN43

JUSTICE ROSS: All right, okay. Thank you.

PN44

MR DUNCALFE: Thank you, your Honour.

PN45

JUSTICE ROSS: Firstly, did you want to say anything by way of supplementation, and if no, I wanted you to address the argument put in the AWU's submission in reply and just put orally, about this difference in the language in clause 23.2 of the Victorian Award - that's one issue. The second is, it would seem that the inclusion of the reference to industry allowances in the current award and the payment on annual leave was an error and whether you agree with that or not.

PN46

MR LIN: Thank you, your Honour. Firstly, I would just say that we also think that the background paper accurately sums up our submissions and we seek to rely on those. In relation to the Victorian Award, so in that award, the relevant provision uses the words "employee's rate of pay". The words "pay rate" to us, does not - should not include any and all allowances an employee might be entitled to receive.

PN47

JUSTICE ROSS: What does it mean then?

PN48

MR LIN: We say that the employee's rate of pay specifies - simply refers to the employee's rate of pay specified under the table in the wage rates provision of the award. We say an allowance should only form part of an employee's pay rate, if it's expressly or specifically stated to.

PN49

JUSTICE ROSS: When you say the employee's pay rate in the table, are you talking there about the employee's minimum classification rate?

PN50

MR LIN: Yes, that's correct.

PN51

JUSTICE ROSS: Well, but if that argument is right, why have they used the difference in language? It's the employee's pay rate is the pay rate for annual leave and then they talk about, in terms of the loading, the rates prescribed in the award for the classification in which the employee was engaged. Because you say it means the same thing, as I understand it.

PN52

MR LIN: Yes, yes. Well, what we also took into consideration is the fact that they're also getting that 17.5 per cent annual leave leading anyway. To us, it seems it was unlikely that they get - that that loading is calculated on a full rate of pay, because as we understand it, the purpose of annual leave loading is to compensate employees for the sorts of entitlements when they're on annual leave.

PN53

JUSTICE ROSS: But as I understand your submission, you're saying that in clause 23.2, in the first part, the pay rate means their minimum classification rate.

PN54

MR LIN: Yes.

PN55

JUSTICE ROSS: Well, my question is, if that's right, why did they use the expression pay rate when in the same clause they refer expressly to minimum classification rate when they're talking about the 17.5 per cent loading? If they meant the same thing, why wouldn't they say the same?

PN56

MR LIN: I'm not quite prepared for that question, your Honour. But if necessary, I could put something in writing after the hearing.

PN57

JUSTICE ROSS: Look, if you wish. I think the hearing will conclude soon, so you could probably - by say the end of the day, shoot in a short note. But just to be clear about the question, what's put against you by the AWU is that clause 23.2 employs different language to describe what the employee gets. In the first part of the clause, the pay rate for annual leave, that's said to be the employee's pay rate at the time the employee takes annual leave. The employee's pay rate; it's that expression.

PN58

The AWU then contrasts that with, well what's the 17.5 per cent loading paid on? It's paid on the rates prescribed in the award for the classification in which the employee was engaged. So, their minimum classification rate. The AWU's argument is well, pay rate must therefore mean something different to minimum classification rate. They say it means it includes the leading hand payment.

PN59

Your argument it seems, proceeds on the basis that pay rate in the first part of the clause, that expression, the employee's pay rate, is the same as the employee's minimum classification rate, that's as I understand your argument. My question to you is, well, if that's right, why does the clause use the different language?

PN60

MR LIN: Yes, I could put a - - -

PN61

JUSTICE ROSS: No, that's fine, give it some thought and look, it may be that well, we don't know. But if you could send something back by 4 o'clock today, that would be of assistance.

PN62

The other question I had for you was, do I take it, or do you accept that the inclusion of the industry allowance in clause 24.7(b) is an error?

PN63

MR LIN: Yes, we do.

PN64

JUSTICE ROSS: That there was no industry allowance in any of the pre-reform awards?

PN65

MR LIN: None that we can see, no.

PN66

JUSTICE ROSS: All right. Was there anything else you wanted to add Mr Lin?

PN67

MR LIN: No, your Honour.

PN68

JUSTICE ROSS: Are there any other questions for Mr Lin?

PN69

No? All right, thank you. Anything in reply?

PN70

MR DUNCALFE: Nothing, your Honour, no.

PN71

JUSTICE ROSS: Well, thank you both. I think look, it's a fairly confined issue and we understand what each of you say. We'll await that further note if you wish to provide one, Mr Lin, by 4 o'clock today and we'll reserve our decision and issue it in the coming week or so.

PN72

All right, nothing further? Thank you very much; we'll adjourn.

ADJOURNED INDEFINITELY [9.51 AM]