TRANSCRIPT OF PROCEEDINGS

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Fair Work Act 2009 1033062-1

SENIOR DEPUTY PRESIDENT ACTON

AM2011/55

s.160 - Application to vary a modern award to remove ambiguity or uncertainty or correct error

Application by Australian Industry Group, The
(AM2011/55)
Manufacturing and Associated Industries and Occupations Award 2010

(ODN AM2008/5)
[MA000010 Print PR985120]]




Sydney

12.25PM, WEDNESDAY, 14 MARCH 2012

Reserved for Decision

Continued from 22/02/12

PN139

THE SENIOR DEPUTY PRESIDENT: Is there any change in appearances?

PN140

MS G. STARR: Yes, there is. Starr, initial G, appearing for Australian Business Industrial.

PN141

THE SENIOR DEPUTY PRESIDENT: Thank you, Ms Starr. All right, Mr Smith, where are we at on this?

PN142

MR SMITH: Yes, thank you, your Honour. Since the last hearing we've had some discussions with the ABI as well as with some of the unions, and I'm aware that the unions have had discussions amongst themselves about the issues as well. Following those discussions we filed an updated - or a draft determination; I don't think we'd filed one previously - but with the draft determination that we filed, as your Honour can see, we picked up on the suggestion that came up at the last hearing that there be a definition of "composite materials" actually put in clause 3 rather than in the coverage clause.

PN143

We've also included a definition of "recycling", even though we note your Honour's comments at the last hearing that it's hard to see why that definition actually adds anything, given that when 4.9(a)(iii) is properly considered with the amendment, 4.9(a)(iii) brings in only products and materials that are covered by the award; but we have tried to accommodate the concerns of the other parties. As we've said from the start, we're not seeking to expand the coverage of the award, but there are many organisations that are using the award to cover recycling of metals, plastics, electronic products and other materials that are mainstream products covered by this award.

PN144

In our discussions with the ABI, it appears that their concerns relate to areas of concrete products, asphalt, premixed concrete, and quarrying. We haven't been able to get to a position of agreement. In our view all of those materials are very obviously not materials covered under the award. We think it would add uncertainty and complexity to the award to be excluding work covered under four other awards when those four other awards clearly cover very specific types of materials that are not covered under this award.

PN145

The problem with actually naming any other awards, as we said at the last hearing, that then means that the Manufacturing Award is the bit that's left after the scope of all those other awards is dealt with, and there's also a concern that the scope of those awards, over time, could change. We're not seeking to disturb any of the existing arrangements. We're just seeking to clarify the coverage for companies like Sims, OneSteel Recycling, MRA, and many other companies beyond those three that have been specifically involved in these proceedings in various ways.

PN146

The AMWU, as we understand it, still continues to strongly support the application, and we share the view that the AMWU put at the last hearing that the overlap clauses in all these other awards deal with any minor issue of overlap. But we, for the life of us, can't understand any concerns about overlap when in the case of ABI we're talking about quarrying materials, concrete products, et cetera, which are not products under this award.

PN147

THE SENIOR DEPUTY PRESIDENT: The overlap clause is not in all the other awards, is it? Is it in the Waste Products Award or - - -

PN148

MS TAYLOR: Yes, your Honour.

PN149

MR SMITH: The Waste Products Award I'll come to. The ABI is not seeking, as I understand it, the Waste Management Award to be included, but - - -

PN150

THE SENIOR DEPUTY PRESIDENT: Okay.

PN151

MR SMITH: The TWU have just handed me a submission that I hadn't seen. I still haven't read it properly - I only got it a couple of minutes ago - but I can easily deal with the issue of the Waste Management Award. Before doing so, perhaps if I can just deal with the CFMEU's issues. We have had some discussions with Mr Maxwell, and it seems that the CFMEU are trying to use these proceedings to deal with a longstanding area of disagreement that we've had with the CFMEU about the intersection between the Manufacturing Award and the Construction On-Site Award and are seeking a general exclusion in the Manufacturing Award for the On-Site Award.

PN152

That would cause enormous problems for a large number of companies that are involved in service work and installation work that the CFMEU, at least, would try and argue are covered under the On-Site Award. So we very strongly oppose that exclusion. We haven't been able to resolve the more specific issue that is the subject of these proceedings, but it seems Mr Maxwell's main concerns go to issues of concrete and quarrying products and things that clearly aren't covered under this award anyway.

PN153

The AWU's concerns are very similar. They've raised a long list of other awards, again all the similar sorts of awards that have been raised by the ABI and CFMEU, and it, in our view, is just jumping at shadows, because this application does not intrude into those areas and, as we talked about on the last occasion, there's already a clause that is in the Manufacturing Award - and was in the Metals Award for as long as anyone can remember - saying that the awards cover every process, duty and function associated with the industries covered.

PN154

As we also said on the last occasion, this issue may never have arisen if it wasn't for the FWA's involvement in looking at this issue of award coverage, and clearly the FWA correspondence and the views of all the other parties highlights the uncertainty that's there. The TWU have filed a submission which, not surprisingly, draws upon the definition of the waste management industry, which, as we said on the last occasion, is in our view ridiculously broad, but it has to be read with the very narrow classification structure in the Waste Management Award, which we reproduced on pages 9, 10 and 11 of AIG1.

PN155

So even though that award looks like it has a very broad coverage, it doesn't, and if the TWU's position was to prevail, there would be massive disadvantage for thousands of employees in numerous industries because recycling is an activity carried out in many, if not most, industries. There's a huge focus on the whole issue of recycling and avoidance of waste. So we believe that we've done everything that we possibly could to resolve the concerns of the other parties, and with the modifications that we've suggested in our draft determination, those resile any legitimate concerns that other parties may have.

PN156

We believe that the requirements of section 160 are clearly met. There's clearly ambiguity or uncertainty in the existing award, as demonstrated by the FWA's correspondence and all of the submissions that have been made. As we also put at the last hearing, we think at least in one aspect the parties made an error by neglecting to put the issue of carbon fibre in the coverage provisions when it was in the coverage of the manufacturing - or in the Metals Award.

PN157

On the issue of composite materials, as we understood the position that was put by the other parties, the only term that was of concern in the proposed 4.10(oo) was the term "composite materials", and the legitimate issue was raised that "composite materials" might include concrete or different timber materials. To deal with that issue, we've put the definition in 3.1 of the draft determination which refers to composites of materials which are covered by the award. So if they include, say, fibreglass and resin or polymers and carbon fibre, et cetera, they would be covered, but if it's talking about timber or concrete or anything like that, then clearly that wouldn't meet the definition of "composite materials".

PN158

So the final amendments that we're seeking, we believe that they are very modest. They simply reinforce the longstanding existing arrangements of employers and employees, and we urge the tribunal to make the variation as sought and reflected in that draft determination. If the tribunal pleases.

PN159

THE SENIOR DEPUTY PRESIDENT: Mr Smith, you don't actually need the "including" in the composite materials, do you? Composite materials means composites of materials which are covered by the award, full stop.

PN160

MR SMITH: Yes, that's fine, your Honour.

PN161

THE SENIOR DEPUTY PRESIDENT: Yes.

PN162

MR SMITH: And as I've said, the "recycling" definition, if it gives people comfort then we're happy to have it there, but it really doesn't add anything beyond what is already in 4.9(a)(iii).

PN163

THE SENIOR DEPUTY PRESIDENT: Okay.

PN164

MR SMITH: Thank you, your Honour.

PN165

THE SENIOR DEPUTY PRESIDENT: Are you going to go next, Ms Taylor?

PN166

MS TAYLOR: Thank you, your Honour. As Mr Smith indicated, the union have had some conversations; the CFMEU, the AMWU and the AWU. We're still of the view that the overlap clause would cover the issues. I think we understand each other's issues a bit better, but I'm still of the view that the overlap clause, in conjunction with other clauses of the award, the industry clause and the definitions clause, can solve these issues.

PN167

THE SENIOR DEPUTY PRESIDENT: The overlap clause is that one which says something like "where an employer is covered by more than one award, then the employees in the classification which is most appropriate and the environment" or something like that?

PN168

MS TAYLOR: That's right. Your Honour asked was it in the Waste Management Award.

PN169

THE SENIOR DEPUTY PRESIDENT: Yes.

PN170

MS TAYLOR: It's at clause 4.7 of the Waste Management Award and it's in that standard form.

PN171

THE SENIOR DEPUTY PRESIDENT: Is it in all the modern awards that have been raised by the parties in these proceedings?

PN172

MS TAYLOR: Your Honour, it's my understanding it's in all of the awards that have been raised except for the Joinery Award. I understand the CFMEU's concerns in relation to that, but my concern is that if you put all these broad exemptions in, it still doesn't resolve the issue, because one is always going to have to look at whether the work is actually covered by the award, and then that's the test of whether the work is in the industry but also covered by the classification.

PN173

So whether you have the overlap clause or not, if there is a dispute, a live dispute, about whether the work is covered, you'll still need to have reference to the award - its industry, its definitions and its classifications - to establish whether the work is actually covered by that award. So even though the Joinery Award does not have the overlap clause as such - and I think that is the case, as it is with the Manufacturing Award; that the Joinery Award is an industry and an occupational award, so that people will be covered by this award in various industries - but if you look at the Joinery Award, I think the CFMEU's concerns could be eased because of the specificity in that award.

PN174

So within the definitions section of the Joinery Award, you have very specific definitions for "carver, glass and glazing work", and that includes trade and non-trade aspects of glass and glazing work; you have fitting; you have the packing and delivery, including any labouring work, so whilst labouring work may, in many industries, not be particularly obvious in the description of the award that it's related to that industry, this definition actually brings labouring work into the industry of the award; you have definitions of "joinery work", means "work performed by the classifications" and "includes preparation, decoration and assembly of joinery or building components, principally in timber or similar material".

PN175

Now, Mr Maxwell raised a concern that formica is used in the fabrication of kitchens. Formica is a composite material, some of which is mentioned in the Manufacturing Award, but the specificity in the definitions of the Joinery Award, and then again with the classifications, would simply out-trump any mention of composite material in the Manufacturing Award if we were to compare which is the appropriate award. So even though there is no overlap clause in the Joinery Award, I don't think that the concerns that the Manufacturing Award is going to march into this area can be upheld.

PN176

In addition to the definitions, they go on to prefabricated building, shopfitting, stonemasonry, and then also we have the coverage clause which indicates that the award operates in the joinery and building trades industries and occupations. When we look at those trades and occupations - joinery work, shopfitting, prefabricated buildings, stonemasonry, glass and glazing contracting and the occupations - there is no such specificity. So in relation to the fabrication of kitchens and this formica composite - and I'm sure there are many other examples like that that there might be composites included in some other product - the Manufacturing Award would not be able to march into this area covered by the Joinery Award.

PN177

Your Honour, in relation to the TWU's submission, we think it's misconceived in the sense that the claim is that the AIG's application will create overlap. The fact is that there is overlap. Many awards will be recycling. As we say again, putting in an exemption is not going to solve that overlap but the overlap clause will, and if there is a live dispute, then the overlap clause, in conjunction with the industry clause and the definitions clause of the award, will solve that dispute. Thank you, your Honour.

PN178

THE SENIOR DEPUTY PRESIDENT: Ms Starr.

PN179

MS STARR: Thank you, your Honour. As indicated by the applicant following the hearing on 22 February and your Honour's encouragement for the parties to enter into further discussions, we did that. We've met with the applicant, discussed our concerns, and we put forward a couple of alternatives to remedy any of the potential overlap with the other modern awards which Mr Smith has indicated we have an interest in. Ultimately, the proposals that we put forward were not accepted.

PN180

So for the purposes of today, our submissions are that we oppose the application. Firstly, we oppose it on the grounds that we do not think that the requirements of section 160 of the Act are met, and I'll deal with that in a moment. However, in the alternative, if it's a matter of the exercise of the tribunal's discretion we'll make further submissions on why we say that there continues to be a genuine concern in relation to overlap, notwithstanding the draft determination which attempts to deal with some of those problems.

PN181

In relation to the section 160 requirements, it's our view that section 160 of the Act is curative in nature. While any variation made pursuant to 160 must also achieve the modern awards objective, its primary focus is to cure some issue which has arisen through the drafting of the award. Any variation therefore sought must satisfy one of three limbs: must remove an ambiguity, remove an uncertainty, or correct an error. As such, if a provision of a modern award is reasonably open to more than one meaning, then this should be cured by a section 160 application. Additionally, if due to the interrelationship of various provisions in a modern award or perhaps between modern awards - is uncertain, then this should also be cured.

PN182

Lastly, the error limb refers to a variation that seeks to cure an error that has arisen in how the modern award is drafted when compared to how the modern award was intended to be drafted, or how it operates when compared to how it was intended to operate. The error is not simply that the tribunal did not do what one or more of the parties wanted but, rather, that the operative version of the modern award is not what was intended. We say that the tribunal must first make a finding that an ambiguity, uncertainty or error exists before we move to discussions around how to best remedy that.

PN183

The application and what we say is the extensive nature of the variations sought reinforces that this is not just an issue in regard to ambiguity or uncertainty. There is also no evidence that supports the view that the tribunal made an error in the making of the modern award in 2009. Rather, we say that the application seeks to introduce a materially new concept, which is recycling, which has no history in the superseded pre-modern awards. We say that this is a new issue and not an error. It's our view, therefore, that we think that there is no jurisdiction for the tribunal to proceed with this application. The proper form for an application such as this one would be the 2012 award review process which is currently underway.

PN184

Were the application jurisdictionally sound it should, further, not be granted as a matter of discretion. There are proper and legitimate concerns about the interaction of this award with other modern awards. The inclusion of recycling in clause 4.9(a)(iii) disturbs language dealing with coverage which was well settled in the pre-existing Metals Awards. The applicant claims that this is an attempt to cover internal recycling using materials which are otherwise used by employers or any covered by the award. However, the application does not limit the notion of recycling to these internal ancillary recycling activities, but adopts a broad definition which involves recycling materials otherwise covered by the award.

PN185

The inclusion of definitions as proposed by the applicant in the draft determination does not guarantee that a broad interpretation of "recycling" might not be adopted by a tribunal in certain circumstances in the future. To this point, we note that clause 4.10 of the award, which lists those relevant products and materials, is indicative and not an exhaustive list. In any event, if it's the intention of the applicant to contain the scope of the award to employers already covered by the award there is also a strong case, in our view, to be made that the award already achieves this.

PN186

Clause 4.9.(a)(ix), which defines "manufacturing and associated industries and occupations", in our view acts as an appropriate integral catch-all, so that the definition includes "every operation, process, duty and function carried on or performed in or connection with or incidental to any of the foregoing industries, parts of industries or occupations".

PN187

Turning now to why we say that the application interferes with the coverage of other modern awards, we make the following submissions.

PN188

THE SENIOR DEPUTY PRESIDENT: Just before you do, you made the submission that clause 4.10 was indicative, not exclusive.

PN189

MS STARR: Yes, your Honour. Sorry, 4.10, as I read it, "For the purposes of clause 4.9(a)(i) the products, structures, articles, parts, components, materials and substances include" - and then goes on to list.

PN190

THE SENIOR DEPUTY PRESIDENT: But you say "products, structures", et cetera, because of the use of the word "include", goes beyond what's listed in (a) through to (mm)?

PN191

MS STARR: We say that it's a possibility that it could be read in that way.

PN192

THE SENIOR DEPUTY PRESIDENT: Right, yes.

PN193

MS STARR: In turning to why we say that the application interferes with the coverage of other modern awards, we make the following submissions. The recycling of materials or substances as set out in clause 4.10 would be covered should the application be successful. Putting aside the addition to 4.10 of "composite materials" - which creates some additional problems - simply the insertion of "recycling" is suffice to interfere with the coverage of other modern awards.

PN194

For instance, 4.10(a), which says that "all products made from or containing steel, iron", et cetera - and I don't intend to deal with this in detail, because I know that we've made previous submissions, as have other parties, on this point, but the tribunal would be aware that steel wire fibres are a common additive to concrete. These are physically added into a concrete agitator bowl at the concrete batch plant site and they are used to strengthen the properties of the concrete.

PN195

Also, steel reinforcing is used in the concrete when it's placed in situ within a building construction site. There is also slag, which is a form of metal and a by-product of steelmaking, which is used as a substitute for cement. This would be used in both the premixed concrete industry and concrete products. It's also used in asphalt mixes as well.

PN196

Next, 4.10(o), "clay and ceramic articles including bricks and tiles". Bricks are a key component of materials which are taken from building and construction sites and then recycled under the Quarrying Industry Award to produced quarried materials. At its broadest, the application would then cover the recycling of plant, equipment and buildings, including power supply in any other industry under clause 4.9(a)(iii) and dot point 4.

PN197

The Quarrying Award expressly covers the recycling of demolition materials from construction sites which are then processed to make recycled quarried materials. Given the increased pressure on the quarrying industry to produce recycled materials to supplement virgin quarried materials, recycling should not, in our view, be considered as an insignificant or minor function of the quarrying industry.

PN198

Lastly, the insertion of 4.10(oo), as proposed by the applicant, raises a further conflict, being "plastics, polymers and fibreglass". These are another common additive of concrete; that is, plasticiser, which is a plastic polymer based material, effectively a plastic liquid, which is again used in concrete to improve the workability of concrete - that is, to make it more fluid without having to add additional water, which reduces the strength of concrete. Similarly, fibreglass is used to achieve certain functionality of concrete because of its lightweight properties.

PN199

In summary, if the tribunal is able to make a finding that the requirements under section 160 are met and that clause 4.9(a)(ix) does not already achieve the intended effect of the application, then it's our view that the tribunal must maintain the integrity of the other modern awards and the best way to deal with this is by exemption of those awards. As I already noted, these are the Quarrying Award, Premixed Concrete Award, Concrete Products Award, and the Asphalt Award. Such an approach should not raise any concerns from the applicant or other parties if the intention of this application is simply to deal with the internal recycling performed by employees already covered by the award. We note that this approach was adopted by the full bench in a number of other modern awards during the 2009 award modernisation process. It is the simplest and safest manner to deal with issues which might arise if the application is successful, because overlap is highly industrially undesirable. Those are our submissions, if it pleases the tribunal.

PN200

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Maxwell.

PN201

MR MAXWELL: Thank you, your Honour. Your Honour, in regard to this application we would like to point out that the only companies that the AIG have identified as to why this application is necessary are Sims Metals - and MRA, I think, is another metal company as well. So the particular issue they sought to address was the recycling carried out by Sims and other metal-recycling companies and the recycling of electrical products. There is no evidence in regard to any manufacturers of composite materials that they seek to have covered or the manufacture of any of the other materials they seek to now include.

PN202

Your Honour, we have had your discussions with the AIG and we considered their draft determination. We have an alternate draft determination which builds on theirs, but which we think addresses the concerns of most of the objectors to this matter.

PN203

THE SENIOR DEPUTY PRESIDENT: Have you shown this to the others, Mr Maxwell?

PN204

MR MAXWELL: Sorry?

PN205

THE SENIOR DEPUTY PRESIDENT: Have they seen this before now?

PN206

MR MAXWELL: They haven't seen it, but we have raised with the AIG what our concern was and that we still believe that it will be necessary to include an exclusion for a number of awards, and these were the awards that were dealt with in the proceedings when they were last before you, and there's a suggestion that you made about including the exclusions to the awards.

PN207

The additions to the draft determination of AIG are item 4, which is new paragraphs in subclause 4.11, to make it clear that the Manufacturing Award doesn't cover employers or employees engaged on recycling work covered by the Building and Construction General On-Site Award, the Waste Management Award, Timber Industry Award, Joinery and Building Trades Award, and Quarrying Industry Award, and they were the awards that we had previously identified.

PN208

Then the new (k) would cover - the award would not cover employers or employees engaged in the manufacture of products and composite materials covered by the Timber Industry Award, Joinery and Building Trades Award, Concrete Products Award, Asphalt Industry Award, and Premixed Concrete Award, which I think was a number of the issues that were raised by the ABI as well.

PN209

The last point we seek is there is also an exclusion for employers and employees engaged in on-site work in the building, engineering and civil construction industry, and that is by reference to the On-Site Award.

PN210

THE SENIOR DEPUTY PRESIDENT: What's the purpose of the last one?

PN211

MR MAXWELL: The last one deals with any employees that are engaged on site.

PN212

THE SENIOR DEPUTY PRESIDENT: Yes, but they're covered by the On-Site Award, aren't they?

PN213

MR MAXWELL: Sorry?

PN214

THE SENIOR DEPUTY PRESIDENT: Doesn't the coverage of the On-Site Award cover - - -

PN215

MR MAXWELL: We say it does, but we have had this ongoing issue with the AIG because of the words in the Manufacturing Award, which talks about the installation of products covered by the award, and that is in clause 4.9(a)(iii), where it talks about "repair, refurbishment, reconditioning, maintenance, installation, testing and fault-finding of", and it goes on. The issue of installation: that provision arose out of the old Metals Award, and if you trace it back through the history I think you'll find that that was included when the Metals Award did apply to the on-site construction industry for metal engineering companies. Initially the Metals Award had an appendix that covered On-Site Award, then in, I think, the late 80s the National Metal and Engineering Construction On-Site Award was created, but that was - - -

PN216

THE SENIOR DEPUTY PRESIDENT: Your proposed 4.11(l), is that to deal with the problem of the word "installation"?

PN217

MR MAXWELL: That's correct.

PN218

THE SENIOR DEPUTY PRESIDENT: That's not part of this application, is it?

PN219

MR MAXWELL: No, but what I will come to is to raise how the use of the word "installation" affects the products that they now seek to include as part of this award. Your Honour, perhaps if I can hand up a document which just really explains the complexity of the issues in a bit more detail.

PN220

THE SENIOR DEPUTY PRESIDENT: Yes.

PN221

MR MAXWELL: Your Honour, you will note in the draft determination proposed by the AIG they seek to insert a definition of "composite materials". It means "composite materials which are covered by the award" and that includes "plastics, fibreglass, polymer, vinyl, resins and ceramics". So it could be argued that if any composite material includes resin that's part of the composite or a polymer, then it's covered by the Manufacturing Award. Your Honour, the documents I've just handed up go to explaining why that is problematic.

PN222

The first page is a material safety data sheet for formica benchtops. It sets out under section 3 the composition or the ingredients of a formica benchtop. So the first ingredient or main ingredient is laminated wood panel containing softwood particles. So that is your first major component of formica. Then the second component is melamine, urea or formaldehyde resin, which can be 10 to 30 per cent of the product.

PN223

You then have phenol or, again, formaldehyde resin, which can be 10 per cent. So clearly the manufacture of formica or laminex - which is the more common term - includes the use of resins. In terms of the main producer of laminex in Australia, which is the actual company Laminex Australia, they are covered by the Timber Industry Award, and that award particularly covers the manufacture of engineered products.

PN224

The next couple of pages, your Honour, deal with the issue of reconstituted stones. As we pointed out in our earlier submission, reconstituted stones include the use of polymers and resins. So if you look at Caesarstone, which is a very common kitchen benchtop these days, they're manufactured from up to 93 per cent quartz, and high quality polymer resins and pigments that are compacted under intense vibration. So again we have reconstituted stone which includes polymer resins, which are part of the materials that the AIG say should be covered by the Manufacturing Award. Reconstituted stone and reconstituted granite - or the manufacture of panels out of those products - are covered by the Concrete Products Award.

PN225

I won't go to the rest of the different types of reconstituted stone, but that is just to explain what are the main products that are used. Your Honour, I've also included there a reference to terrazzo. Terrazzo is another form of reconstituted stone, and again, that is made out of glass which is a component that is covered by the Manufacturing Award, but also with a binder which again can be polymer or a similar material, or a resin. The production of terrazzo panels is clearly covered by the Concrete Products Award.

PN226

Your Honour, the last page is dealing with the issue of carbon fibre, which goes to this question of the installation of products. You will recall that the application seems to insert a new subclause 4.10 paragraph oo, which includes:

PN227

Products and components manufactured from composite materials, carbon fibre, carbon graphite et cetera.

PN228

I also refer you to that part of the award that deals with installation of those products. Your Honour, what I've handed up is an extract from the web page of Freyssinet Australia, which is a major civil engineering company which is part of a multinational operation. You'll see that about a third of the way down the page, it talks about carbon fibre strengthening, and that:

PN229

The TCF carbon fibre fabric, and LCF carbon fibre laminate processes are patented systems for structural strengthening by the bonding of carbon fibre based fabrics and laminates. Its applications include bridges and industrial structures made from concrete, steel, timber and masonry. The carbon fibre materials are light yet a versatile strengthening solution.

PN230

So again we have a situation where carbon fibre products, whilst the manufacture of them may be covered by the Manufacturing Award, the installation of the carbon fibre products in this situation will be clearly covered by the Construction Award which is - the work is done by a construction company. So we say that is why the reference to the exclusion for on-site building work is needed.

PN231

We know that Mr Smith has said including the exemption for the Building and Construction Award would create all sorts of problems, but I would point out that under the coverage of the Building and Construction General On-Site Award 2010 there is specific reference in clause 4.10(c)(ii) that metal engineering construction - this does not mean - sorry:

PN232

This does not include any work which is incidental to or of a minor nature in relation to the work normally performed by an employee of an employer not engaged substantially in metal and engineering construction.

PN233

So Mr Smith's main concern was that the CFMEU and others would seek to apply the Construction Award conditions to someone who may spend 30 minutes on a construction site, well, we say that provision there clearly deals with the concern that is raised by Mr Smith.

PN234

In terms of recycling, we've addressed this previously, and I think if I can take you to our original written submission that we made, your Honour, in that submission we included at appendix A a list of companies that are engaged in recycling work, and this was taken from the Master Builders Association of Victoria Guide to Recycling Services in Victoria. Your Honour, I don't wish to spend a lot of time going through this document, but if you look at the first company A and R Second-hand Dealers, they deal with bathroom fittings, doors, timber and windows. To the extent that the Manufacturing Award covers the manufacture of aluminium window frames, as opposed to the complete window, on the basis of the definition of recycling put forward by Mr Smith, that company would be covered by the Manufacturing Award.

PN235

If we then look at Anglo Australian Demolition, which is perhaps one of the examples of those companies that are engaged in construction, the materials they accept are bricks - the manufacture of bricks is covered by the Manufacturing Award - doors, windows, corrugated iron, which would be covered by the Manufacturing Award, and roofing, which could be metal roofing.

PN236

Your Honour, you will see that that guide runs to some approximately 10 pages, so there are 10 pages of companies engaged in recycling and a number of those would recycle products that would be covered in their manufacturing phase by the Manufacturing Award. So that is why we have a problem with the definition of recycling put forward by the AIG, and why we believe the exemptions we put forward in our draft order are necessary.

PN237

THE SENIOR DEPUTY PRESIDENT: So who do you say - which award covers Anglo Australian Demolition Co now?

PN238

MR MAXWELL: The Construction Award.

PN239

THE SENIOR DEPUTY PRESIDENT: Alex Fraser Recycling Industries which deals with asphalt and concrete?

PN240

MR MAXWELL: The Construction Award.

PN241

THE SENIOR DEPUTY PRESIDENT: By virtue of what?

PN242

MR MAXWELL: By the work that they do in demolition. Your Honour, that is a company that has agreements with the CFMEU in terms of the work that they do.

PN243

THE SENIOR DEPUTY PRESIDENT: Well, they may, but how do they fall in the coverage of the Building On-Site Award?

PN244

MR MAXWELL: Because they are involved in the collection of recycled materials from construction sites, so they go onto the sites and from the proceeds of the demolition, or during the demolition phase, they then - - -

PN245

THE SENIOR DEPUTY PRESIDENT: So picking it up from the site is sufficient, is it?

PN246

MR MAXWELL: In terms of providing mobile crushing services on site, yes, because that is part of the work that they do.

PN247

THE SENIOR DEPUTY PRESIDENT: So all these companies actually do their recycling on site, do they?

PN248

MR MAXWELL: No, not all of them, your Honour, and that's the point we're trying to make, is that these companies are engaged in a range of industries. You will see that in the list we have Boral Quarries. Now, they recycle concrete, and their recycling will be performed as part of their off-site or nonconstruction-site operations. But that then supports the variation where you'd exclude recycling work covered by the Quarry Industry Award.

PN249

THE SENIOR DEPUTY PRESIDENT: So you say Boral Quarries is not covered by the On-Site Award in respect of their recycling of concrete. It is covered by the which award?

PN250

MR MAXWELL: The Quarry Award.

PN251

THE SENIOR DEPUTY PRESIDENT: Right, okay.

PN252

MR MAXWELL: Your Honour, just briefly in regard to the submissions of the AMWU, we do not believe that the overlap clauses in the awards adequately deal with this issue of coverage, particularly given that in an example which he gave about the Joinery Award, there is no overlap clause in the Joinery Award, and there's no overlap clause in the Manufacturing Award, so we fail to see how the overlap clause helps it in that regard.

PN253

We'd also point out that if you look at the classification structures, particularly if you are at the trade level, in both the Joinery Award, the Timber Award and the Manufacturing Award, you'll see that the classification structures are fairly broad under all three awards, and are fairly similar in terms of the indicative tasks for the various levels. So we say that that doesn't give any help in terms of the classification structure. If you then look to the environment in which the work is performed, again you would come to the issue of at the end of the day, you can have a manufacturing factory, you can have a joinery factory, you can have a timber factory; you could go into those and you'll see a range of machines. You will see allocated walkways, so the environment in which the work is performed will be similar between all three awards.

PN254

We believe that by putting in the specific exclusions that we seek, it will remove the issue of that once and for all, and we will not need to bother the tribunal with those issues in the future. If the tribunal pleases.

PN255

THE SENIOR DEPUTY PRESIDENT: Thank you. Mr Decarne.

PN256

MR DECARNE: Yes, thank you, your Honour. The AI Group's additional clauses contained in the draft determination filed on 13 March do acknowledge the need for narrowing the application in terms of recycling the composite materials. However, we say that those clauses don't go far enough in limiting the overlap of work in connection with some products' manufacturer. For instance, one of the materials in any given composite may be covered by the Manufacturing Award and therefore the definition of "composite materials" could then cover that composite and overlap with another award. Some of those examples have already been addressed by Mr Maxwell and Ms Starr, so I won't reiterate that, your Honour.

PN257

In short, we support an approach that would limit the overlap between the awards as much as possible and, therefore, favour the approach proposed by the CFMEU that clearly limits the application. The proposed wording (indistinct) limits the overlap by simply excluding the awards with current relevant coverage of work in and in connection with the making of composite materials or recycling. Thank you.

PN258

THE SENIOR DEPUTY PRESIDENT: Thank you. Ms Walton.

PN259

MS WALTON: Your Honour, we also support the submissions made by the CFMEU. We would also be seeking an exclusion of the Waste Management Award at the new proposed 4.11(j), as per the submissions we've provided this morning. Our belief is that an ambiguity is going to be created by the application. We would also suggest that any opposition by the applicant to the exclusion of the Waste Management Award would be inconsistent with the argument for lessening ambiguity and certainly inconsistent with the modern award objective. Thank you.

PN260

THE SENIOR DEPUTY PRESIDENT: You filed a submission which details your submissions further. That was filed today.

PN261

MS WALTON: Yes, it was, your Honour, and I have provided a copy to all the parties.

PN262

THE SENIOR DEPUTY PRESIDENT: Yes, all right. While I'm at it, I'll mark the various things that have been handed up. I'll mark the AIG's draft determination, which was filed yesterday, as AIG3.

EXHIBIT #AIG3 DRAFT DETERMINATION

PN263

THE SENIOR DEPUTY PRESIDENT: I'll mark the CFMEU's draft determination as CFMEU2.

EXHIBIT #CFMEU2 DRAFT DETERMINATION

PN264

THE SENIOR DEPUTY PRESIDENT: And the documents of which the top document is "Formica benchtop blanks", as CFMEU3.

EXHIBIT #CFMEU3 BUNDLE OF DOCUMENTS WITH TOP DOCUMENT "FORMICA BENCHTOP BLANKS"

PN265

THE SENIOR DEPUTY PRESIDENT: And the TWU submission of today, provided today in writing, as TWU1.

EXHIBIT #TWU1 SUBMISSION

PN266

THE SENIOR DEPUTY PRESIDENT: Mr Smith.

PN267

MR SMITH: Yes, thank you, your Honour. Initially, if I could just clarify AI Group's position on that issue that your Honour raised; that is, the idea of putting a full stop after the word "award" in 3.1, the definition of "composite materials". Thinking about that issue, your Honour, that is a much neater and clearer way of going, because of course those materials there are just examples. So that would be, in our submission, a better construction.

PN268

If I could deal initially with the ABI's issues, the first point was raised about our application not meeting the requirements of 160, and the first point there is, we've raised section 160, we believe that the application very much does meet section 160, but we've said in our submissions and application that we also believe - and press the point - that the application meets the requirements of 157. So if your Honour was not convinced that the requirements of 160 were met, then certainly, for all the reasons that we've outlined today and in the earlier hearing, the requirements are met, in that it's necessary to meet the modern awards objective, but we think there's no doubt whatsoever that the application meets the requirements of 160 and, just listening to the ABI's submissions, it's obvious that it does.

PN269

Firstly, the point was put that for ambiguity to be established there must be more than one meaning, and all of the different views that have been put, particularly about the construction of 4.9(a)(ix) and (x) in particular - these are clauses which have very broad wording about every process, duty, function, in addition to handling, sorting, packing, distribution, et cetera, be included within the award. Now, the arguments that are being put, that somehow or other the previous awards didn't cover recycling in the way that we're arguing that it did, show that, at least in the position that's been put to you by various parties, there clearly is ambiguity there in the eyes of some; and your Honour would have more than enough basis there to establish that there is ambiguity.

PN270

But the position was put by ABI that this notion of uncertainty is particularly in the area where there is uncertainty around the coverage of different awards. Now, it's very clear in these proceedings that there is uncertainty. The FWA's correspondence shows that even the regulator is saying that there is uncertainty around these different awards and that that uncertainty has led to them, at least in that matter, not being able to dispute the fact that the Manufacturing Award applies, despite the fact that the original determination was that the Waste Management Award applies.

PN271

The ABI also said there's no history in this area, which in our submission is nonsense. We've got a letter from Sims, the biggest recycling company in Australia and one of the biggest, if not the biggest, in the world, which has agreements with all of the unions represented here, around the Manufacturing Award. They were covered by the Metal Industry Award for as long as anyone can remember and they used the Manufacturing Award and agreements linked to that award. OneSteel Recycling has numerous plants linked with the Manufacturing Award and previously with the Metals Award. There is a lot of history, including in the area of electronic products, the Manufacturing Award and previously the Metals Award, and all the NAPSAs that applied dealt very widely with that.

PN272

ABI put a position which I didn't quite understand. It was something about somehow or another we're not arguing that recycling should be limited to ancillary activities. We're not doing that. We're saying recycling is a mainstream part of the coverage of the Manufacturing Award. Some of the biggest companies covered by the award, like Sims, OneSteel and others, that is their business. It's not a sideline. That is their entire business. They are massive companies with heavily unionised workplaces that are in the business of recycling.

PN273

So we don't try and argue that we're just trying to cover ancillary activities which - the position has been put with these other awards that this is a sort of sideline in those other industries. We're not, of course, seeking to cover recycling in all industries. We're seeking to cover recycling of the industries that are already covered in the way that these companies are applying the existing award.

PN274

Now, there was an argument about the use of "include" in 4.10, but that seems to be an argument about the overall coverage of the award. It's not an issue about recycling. If there's going to be any suggestion that the award is not clear because of the word "include", that is an argument about the broader coverage of the award and, to the best of my knowledge, no-one has sought to interpret that word "include" in an unreasonable way.

PN275

The issue of the CFMEU's submissions needs some focus. With the draft determination that Mr Maxwell put up - and I think the ABI might have raised this issue too - there seems to be some suggestion that the definition of "composite materials" could be read as though it said "composite materials means composites of any material", "includes any material covered by the award", as though we're talking about concrete with some plastic product injected into the concrete or the use of a bit of steel.

PN276

This is about composite materials covered by the award, so it's not talking about just one material. It's talking about composites of materials, whether it be metals and carbon fibre or plastics and polymer, et cetera. It's can't be read in that unreasonable way that it's being argued.

PN277

THE SENIOR DEPUTY PRESIDENT: Hang on. What are you suggesting? That the definition you provide means only composites of the materials that are covered by the award? So for example, composites which are plastics and fibreglass, not other products which include those.

PN278

MR SMITH: That's the way that we interpret that, because we're not saying "composite materials include", and the sorts of products that we are talking about, they will have various chemicals and so on included, which are also under this award, but they are composites of materials covered by the award - exactly what is said there. They're not composites which include one material covered by the award. That's not what it says. The wording there talks about composites of materials covered by the award. So we think there's nothing in that argument.

PN279

The issue of the exclusion of all these awards - we very strongly oppose that. We think it would add enormous uncertainty, and your Honour only has to have a look at that definition of waste management industry in the TWU's submission to see that that would cover every form of waste and recycling in every industry, if it was read in an unreasonable way. But of course it has to be read in conjunction with the very narrow classification structure, and the award that it was based on, that applied to waste transfer stations and waste truck drivers, and nearly all the classifications in the award are truck driver classifications. There's just beyond that some low-level labouring classifications.

PN280

So we do very strongly oppose that. We think this idea of including all these other awards will create enormous uncertainty, and will lead to a raft of problems that simply will not be there with our wording, because all these creative arguments that are being run around all of these other awards that are going to be disturbed, there's absolutely no suggestion whatsoever that any of that will occur, and if it did, of course, the overlap clause would have work to do, as the AMWU has said, and if there are any problems, then those problems can be brought back before the tribunal. But it cannot be the case, in a very strong submission, that this exclusion excludes the Waste Management Award. That would create far more problems than doing nothing with this application. That would be a disaster, and the other problems would be there too.

PN281

Mr Maxwell's list that he has negotiated with the MBA includes a lot of mainstream companies like four of the Sims plants are here. They've made a submission in these proceedings that their operations are covered under the Manufacturing Award. Companies like Dunlop Flooring are here, that were under the Rubber, Plastic and Cable Making Award and are now under the Manufacturing Award, so this is just a list perhaps derived from the phone book of companies in recycling. Lots of these companies - you know, carpet recycling companies. Carpets are under the Manufacturing Award. Probably a great many of them are already using the Manufacturing Award. They're certainly not a list of companies that are using the On-Site Building Award.

PN282

MR MAXWELL: Your Honour, I'm loath to interfere with Mr Smith's submissions, but that wasn't the point we were making. The point about this was to show that there are companies engaged in recycling that would cut across a range of awards. We weren't saying that that list is a list of companies that are only engaged in the Construction Award.

PN283

MR SMITH: That, your Honour, just highlights what we're saying. That list just shows what everyone is of course aware of, that recycling goes on in every industry. In terms of that proposed clause 4.11(l) this issue of a general exclusion has been dealt with at length before a full bench of the tribunal. The CFMEU's submissions have been rejected in support of that exclusion, and Mr Maxwell is having another go at the issue in these proceedings.

PN284

We do not accept the history that the Manufacturing Award does not appropriately cover service work and external work. There are probably thousands of companies that are involved in doing things external to their main workshop that are legitimately under this award. Of course, there's a lot of companies doing those things that are under the On-Site Building Award, but putting a general exclusion in this award for the Building Award would be an extremely inappropriate thing to do, that would open up massive problems. If the CFMEU want to rerun the argument that they've run at length, then it should be dealt with in other proceedings.

PN285

I think, your Honour, all of the other issues we've dealt with in our earlier submissions, but if I could just make the one final point, that we don't seek to cause all of these issues that the other parties are raising, and properly considered, it really is a series of submissions that are raising some fairly fanciful arguments. If the tribunal was minded to make the variation as we've sought, we're very confident that none of these adverse consequences will be created, but to the extent that any issues arise, of course everyone has their rights to apply to vary the award. If the tribunal pleases.

PN286

THE SENIOR DEPUTY PRESIDENT: Thank you. I'll reserve my decision in this matter.

<ADJOURNED INDEFINITELY [1.27PM]

LIST OF WITNESSES, EXHIBITS AND MFIs

EXHIBIT #AIG3 DRAFT DETERMINATION PN263
EXHIBIT #CFMEU2 DRAFT DETERMINATION PN264
EXHIBIT #CFMEU3 BUNDLE OF DOCUMENTS WITH TOP DOCUMENT "FORMICA BENCHTOP BLANKS" PN265
EXHIBIT #TWU1 SUBMISSION PN266