Ergon Energy Corporation Ltd & Anor v The Electrical Trades Union of Employees of Australia, Queensland Branch & Ors [2005] QIRC 66 (2005) 179 QGIG 140

[Extract from Queensland Government Industrial Gazette, dated 10 June, 2005, Vol. 179, No.6, pages 140-142] QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 156 – certification of agreement Ergon Energy Corporation Ltd and Another AND The Electrical Trades Union of Employees of Australia, Queensland Branch And Others (No. CA 140 of 2005) PRESIDENT HALL VICE-PRESIDENT LINNANE COMMISSIONER THOMPSON 25 May 2005 DECISION Chapter 6, Part 1 of the Industrial Relations Act 1999 (the Act) makes provision for the making, certification, effect and amendment of certified agreements. Materially, an agreement must be certified if the Queensland Industrial Relations Commission is satisfied about a number of matters particularised at s. 156(1) and must not be certified if the Commission is not satisfied about those matters. The matter of current importance is that particularised at paragraph (m). Section 156(1)(m) provides: “(1) The Commission must certify the agreement if, and must not certify the agreement unless, it is satisfied – (m) for a multi-employer agreement or project agreement – the agreement provides for equal remuneration for all men and women employees covered by the agreement for work of equal or comparable value.”. It is common ground that the agreement currently before the Commission, viz. the proposed Ergon Energy – Certified Agreement 2005 (the Agreement) is a multi-employer agreement. As Counsel for the Anti-Discrimination Commission submitted, who was granted leave to be heard, the clear and direct purpose of s. 156(1)(m) is to prohibit certification of an agreement which does not provide for equality of remuneration, as between male and female workers, where work of equal or comparable value is undertaken by those workers. The language is too intractable to permit importation of any notion that gender played a significant part in setting the unequal rates, or any requirement that the divide between those receiving the lower rate and those receiving the higher rate, is a “gender divide”. In any event, the extrinsic materials give no support to any such contention. The Explanatory Note recounts: “For a multi-employer or project agreement to be certified, the QIRC must be satisfied that the agreement provides for equal remuneration for all employees covered by the agreement.”. The Explanatory Note also makes plain that the purpose of the amendment of s. 3(c) was to separate the object of preventing and eliminating discrimination in employment and the object of ensuring equal remuneration for men and women for work of equal or comparable value. The Second Reading Speech of the then Minister (1 November 2001) certainly identified what is now s. 156(1)(m) as one of a set of provisions directed to “improving the gender earnings gap”. But the speech recognises that the objective will flow from ensuring that “agreement[s] provide equal remuneration for men and women workers who perform work of equal or comparable value…”. Counsel for the Minister for Industrial Relations (intervening) sought to derive support from the Pay Equity Inquiry of 2001, conducted under the auspices of this Commission. All participants accept that the Report of the Inquiry falls within the concept of “extrinsic material” at s. 141B of the Acts Interpretation Act 1954 and so does this Bench. But the expression “gender neutral basis” seems to do no more than emphasise that workers are to receive equal remuneration for work of equal or comparable value, regardless of gender. Act No. 87 of 2001 which introduced s. 156(1)(m), also amended Schedule 5 to provide a definition of “remuneration”. The definition is: “remuneration”, for a provision relating to work of equal or comparable value, includes – (a) the wage or salary payable to an employee; and (b) amounts payable or other benefits made available to an employee under a contract of service.”. It is clear that s. 156(1)(m) is amongst the provisions relating to work of equal or comparable value. It is equally clear that paragraph (b) of the definition is apt to capture allowances made available to an employee under a contract of service. But s. 156(1)(m) requires only that the agreement must provide for equal remuneration for work of equal or comparable value. Payments made for reasons unrelated to the value of the work performed, e.g. (importantly) -- 1 of 4 -- 2 attraction or retention loadings, are not to cause refusal of certification pursuant to s. 156(1)(m), compare Re Equal Remuneration Principle (2000) 97 IR1 77 at paras [127], [139], [147] and [131 to 152]. That is of some moment here. Subject to one matter, the issues on this reference to a Full Bench sufficiently appear from paragraphs 2 and 3 of the submissions of the Australian Municipal Administrative, Clerical and Services Union, Central and Southern Queensland Clerical and Administrative Branch, Union of Employees (AMACSU): “2. Clause 3.8.1 and 3.8.2 of the proposed agreement are as follows: 3.8.1 EDSD Network Recovery Allowance In recognition of the outcomes related to the EDSD Network Recovery, the allowance will apply to employees classified in the Technical Classification Stream of the Award classification structure. Employees that have access to this allowance shall be:  Power Worker – e.g. line work, cable jointing, customer services, inspections, trade and advanced trade technical field and workshop roles (e.g. electrical/electronic, mechanical, fabrication/vehicle building or building services).  Technical Service Person – e.g. line work, cable jointing, customer services, inspections, trade and advanced trade technical field and workshop roles (e.g. electrical/electronic, mechanical, fabrication/vehicle building or building services).  Electricity System Designer/Adviser – e.g. layout/mains design works, marketing advice.  Supervisor – e.g. employees whose primary function is that of trainer/supervisor/coordinator.  Para-professional – e.g. technical roles requiring competencies obtained through Para-equipment, technical investigations and design.  Systems Operator – e.g. operators within designated control rooms within distribution/transmission. Power Workers in the Technical Stream will be paid a pro rata allowance of 70% of the EDSD Network Recovery Allowance as annually adjusted. Employees that are engaged on a part time or casual basis will be paid on a pro rata basis as applicable. Technical apprentices/trainees shall receive the allowance on a pro rata basis in accordance with the relevant percentage level for their respective year, based on the State Training Order 100% tradesman rate, i.e. Salary Point 4.0, 4.2 or 7.0 as applicable… 3.8.2 EDSD Network Recovery Payment Employees classified in the Administration Stream and the Professional & Managerial Streams of the Award Classification Structure in recognition of their contribution to the EDSD network recovery program will receive a payment of $3,000.00 (less applicable tax) delivered over the life of this Agreement… 3. As outlined in affidavit material filed by AMACSU on 19 April 2005 in this matter, the effect of clause 3.8 will be that the base rate for every employee in the Technical Stream, regardless of location, level or position, will be approximately $10,000.00 (for power workers) or $13,000.00 (for other technical stream employees) higher than employees in the other streams at equivalent salary point levels.”. The additional matter is the heading to clause 3.8, V12, Electricity Distribution Service Delivery (EDSD) Network Recovery Attraction and Retention Allowance and Payment. In ordinary circumstances the presence of clauses 3.8.1 and 3.8.2 would not have caused the Commission to refuse certification pursuant to s. 156(1)(m). The materials before the Commission would ordinarily be the proposed Ergon Energy – Certified Agreement 2005 and an affidavit containing the statement required by the Industrial Relations Regulation 2000, s. 9(1)(p) i.e. a statement that the requirement for equal remuneration of employees under s. 156(1)(m) had been met. “Satisfied” means no more than “made up ones mind”, compare Blyth v Blyth [1966] A.C. 643 at 676 per Lord Pearson and Robinson v Cox (1979) 21 S.A.S.R 536 at 546 per Williams A.J. But this was not an ordinary case, AMACSU exercised the right to be heard vested in the organisation by s. 155(1). An organisation exercising that right may well enlarge the information upon which the Commission is to make up its mind. Further, the Commission has power to inform itself on a matter it considers appropriate (s. 320(2)) and some inquisitorial powers. An organisation availing itself of the right at s. 155(1) may well inform the Commission of matters which will cause the Commission to make inquiries about whether the agreement meets the requirements of s. 156(1)(m). Indeed, the information placed before the Commission by the organisation may be so compelling as to -- 2 of 4 -- 3 enliven a duty to enquire, compare R v Australian Broadcasting Tribunal and Others, exparte Hardiman and Others (1980) 29 ALR 289 at 304. However, it is no part of the function of the Commission to enter upon a speculative inquiry because an organisation addressing the Commission pursuant to s. 155(1) voices suspicions or opinions about whether an agreement provides for equal remuneration for all men and women employees covered by the agreement for work of equal or comparable value. A factual foundation for the suspicions or opinions must be given, compare Re Post; Re Election for Offices in Transport Workers Union of Australia, Western Australian Branch (1992) 40 I.R. 162 at 166-7 per French J. here, AMACSU have two things to say. One. It is contended that the award restructuring process which took place pursuant to the Structural Efficiency Principle between 1989 and 1993 and which produced the Electricity Supply Industry Employees Transitional Restructuring Award (which forms the basis of the current Award) was much broader than the exercise required by the Structural Efficiency Principle. It is said that the exercise “involved what was tantamount to work value assessment of all classifications across the industry and ultimately produced and introduced a new classification structure which provided the equal remuneration across every level and pay point within that classification structure irrespective whether one was within the administration stream or the technical classification stream”. It is then contended that to rupture an existing arrangement which ensures that men and women are equally remunerated for work of equal or comparable value, by folding on “allowance” into the base rate of pay for the duration of the agreement is to engage in conduct which, without significant and detailed explanation, causes the agreement to fail to meet the requirements of s. 156(1)(m). The first response to the submission is that whilst the Commission’s Pay Equity Inquiry of 2001 envisaged that those negotiating an agreement would take steps to ensure that equal remuneration was being paid for work of equal or comparable value, and (at the stage of seeking certification) disclose to the Commission the steps which had been taken, neither s. 156(1) nor s. 9 of the Industrial Relations Regulation 2000 adopts that scheme. In the ordinary case all that is required is the proffering of the agreement and an affidavit swearing to the fact. More importantly, the submission rewrites history. The voluminous documents “put in” by AMACSU – and the admissibility of the materials may be left to another day – demonstrate that the restructuring exercise was exactly that. The purpose of the exercise was to ensure (a) that employees received recognition of prior learning, additional training and demonstrated competency and (b) to broadband classifications. The exercise undertaken was very far from being “tantamount” to a work value exercise. And, one might add, it is inherently unlikely that an exercise in developing qualification/competency based relativities within and dehors the award classifications would, by chance, produce the same relativities and incomes as a true work value study. Two. The claim that the payments provided for at clause 3.8.1 are by way of “attraction and retention” allowances is said to be entirely colourable. It is (very legitimately) argued that the money amounts are common, are folded into the base rate and are targeted neither at particular positions, nor at particular skills at particular locations. In other circumstances the criticisms may well have induced this Bench to require the parties to the proposed agreement to put on more material. Here, The Electrical Trades Union of Employees of Australia, Queensland Branch anticipated such a development and put in an extract from a report from the Independent Panel for Electricity Distribution and Service Delivery for the 21st Century (of July 2004), commonly described as the Somerville Report. That report makes claim that “Ergon” faced an urgent need to recruit additional staff within the “technical stream”. Whilst it is true that the expression “attraction rates” is not used, there is an express reference to the need “to invest more in recruiting”. Whilst it is true that the Report includes “engineers” within the category of employees whose recruitment and retention was seen as a priority and that the agreement does not make the “network recovery attraction and retention allowance available to engineers”, one must bear in mind that the remuneration of engineers maybe fixed, not by the agreement, but by individual workplace agreements envisaged by Schedule 3 the agreement proposed for certification. It seems to us that the point has been reached at which we should be satisfied about the bona fides of the submission that the allowances are by way of “attraction and retention”. AMACSU seeks the opportunity to present a work value case. The organisation has that opportunity under Chapter 2 Part 5 of the Act. Given that statutory opportunity which, it might be added, may be pursued without denying employers within the technical scheme immediate access to the monies promised by the agreement, it is very difficult to conclude that the legislature intended attempts at certification of multi-employer agreements to be attended by a work value cases. Such cases are inevitably lengthy. The conduct of such cases could delay any particular application for certification. The availability of Commissioners would further delay the process. The bench will not embark upon such an exercise on this occasion. Notwithstanding that AMACSU holds itself out as an “objector” and that some parties to the agreement have sought to have the “objection” dismissed, the truth is that AMACSU is an organisation with a statutory right to be heard. The Commission has now heard that which it is that AMACSU is able to tell it. Doubtless, if the matter went further, assertions would be supported by affidavits and the documents relating to “award history” would be put into admissible form. But that is all about polishing. Section 155 cannot be construed as empowering the Commission to conduct a roving inquiry into the matter of “equal remuneration for work of equal or comparable value” whenever a multi- employer or project agreement is presented with certification and a relevant employer organisation volunteers to take up -- 3 of 4 -- 4 the role of Counsel assisting the Inquiry; see also Pay Equity Inquiry of 2001 at p. 63. AMACSU has been heard. AMACSU has nothing further to say. AMACSU should be not be further heard, see s. 331(b). The remaining issues relating to certification may be dealt with by a single member of the Commission. The Vice-President will mention the matter on 26 May 2005. Dated 25 May 2005. D.R. HALL, President. D.M. LINNANE, Vice-President. J.M. THOMPSON, Commissioner. Released: 25 May 2005 Appearances: Mr A. Herbert, instructed by Mr P. Copeland of McCullough Robertson Solicitors for Ergon Energy Corporation Ltd and Ergon Energy Pty Ltd. Mr A. Horneman-Wren, directly instructed for the Minister of Industrial Relations. Mr R. Perry SC, directly instructed for the Anti-Discrimination Commission. Mr M. Kimber SC, instructed by Mr J. Payne of Hall Payne Lawyers, for The Electrical Trades Union of Employees of Australia, Queensland Branch and Federated Engine Drivers’ and Firemens’ Association of Australasia Queensland Branch, Union of Employees. Mr I. Buckley of the Queensland Services, Industrial Union of Employees. Ms J. Tovey of The Association of Professional Engineers, Scientists and Managers, Australia, Queensland Branch, Union of Employees. Mr D. Staindl, instructed by Ms J. Garrett of Slater & Gordon Solicitors and with them Mr M. Healy of the Australian Municipal, Administrative, Clerical and Services Union, Central and Southern Queensland Clerical and Administrative Branch, Union of Employees. Government Printer, Queensland The State of Queensland 2005. -- 4 of 4 --