Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees v Captive Services Pty Ltd [2001] QIRC 93 (2001) 167 QGIG 249

6 July, 2001 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 249 ########################################################################################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 407 – power to order contribution to particular fund Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees AND Captive Services Pty Ltd (No. B685 of 2001) VICE PRESIDENT LINNANE 27 June 2001 Application to order superannuation contributions be made to a particular fund – Certified agreement specifies Australian Retirement Fund – Respondent contends that s. 405 applies – Respondent had prior arrangement with a complying superannuation fund other than Australian Retirement Fund – No written agreement as required by s. 405 – Application granted. DECISION This is an application by the Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees (ALHMWU) seeking an order that Captive Services Pty Ltd make superannuation contributions to the Australian Retirement Fund on behalf of employees whose terms and conditions of employment are governed by the Australian Building Services Association – Queensland Division – Certified Agreement 1999 (the Agreement). The Agreement was amended on 16 February, 2001 to insert Captive Services Pty Ltd in Annexure A to the Agreement. As at that date the Agreement had application to Captive Services Pty Ltd and certain of their employees (i.e. those engaged in, or in connection with, or incidental to the operations of Captive Services Pty Ltd and for whom classifications and rates of pay appear in the Agreement). It would appear that there are fifteen employees of Captive Services Pty Ltd currently employed pursuant to the terms and conditions of the Agreement: see Exhibit 5. Clause 3.5 of the Agreement provides as follows:– “3.5Superannuation (1) Definitions (a) “ARF” means the Australian Retirement Fund established and governed by a Trust Deed and Rules dated 11th July, 1996, as may be amended from time to time. (b) “Union” means Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees. (2) Fund (a) For the purposes of this Agreement contributions made by Employers in accordance with the provisions of subclause (4) (Contributions) of this clause, shall be paid to ARF. (b) An Employer bound by this Agreement shall become a participating Employer by: (i) forwarding to ARF a signed Admission Agreement to become a Participating Employer by the end of the calender month in which admission is sought; and (ii) acceptance by the Trustees of ARF of the Admission Agreement. (c) Each Employer bound by this Agreement shall provide every employee who is not already a member of ARF with a Membership Application Form for ARF upon commencement of employment. Each employee shall be required to complete such form and the completed form shall be forwarded to ARF by each Employer by the end of the calender month in which employment commences. -- 1 of 4 -- 250 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 July, 2001 (3) Eligibility of Employees (a) An employee shall become eligible to join ARF on the day of commencement of employment. (b) Subject to subclause (a) an employee shall be enrolled in ARF upon the acceptance by ARF of a membership application form and shall, subject to the approval of the Trustees, be deemed to be a member of the scheme from the day of commencement of employment. (4) Contributions (a) Full-Time Employees: An Employer shall contribute to ARF in respect of each employee such contributions as are required to comply with the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992 as amended from time to time. (b) Part-Time and Casual Employees: An Employer shall contribute to ARF in respect of each employee such contributions as are required to comply with the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992 a s amended from time to time. (c) All contributions will be made in accordance with the ARF Admission Application which states “all contributions will be lodged with ARF (including any contributions which have been retained by the Employer from remuneration paid to the member) within seven days of the end of each month unless prior written agreement has been obtained from the trustee”. (5) Industry Panel ABSA (Q) and the Union meet with representatives of ARF on a regular basis to discuss issues of common interest. One of the purposes of these meetings is to identify whether any Employers have been failing to meet their superannuation obligations and if so, what can be done to address the matter. ABSA (Q) and the Union agree they should participate in this process to help ensure: (a) employees in the industry receive their lawful superannuation entitlements; and (b) all Employers are meeting their lawful superannuation obligations, and that no Employers are commercially disadvantaged by competitors who are not meeting such obligations.”. As at the date of filing this application it would appear that Captive Services Pty Ltd had not made any contributions on behalf of its employees covered by the Agreement to the Australian Retirement Fund. That position seems to have altered in the days just prior to the hearing of the application. As at the date of hearing of this application Captive Services Pty Ltd appears to have made contributions on behalf of six of its employees to the Australian Retirement Fund. The following transfers have been made by Westpac Business Superannuation to the Australian Retirement Fund:– Betty Venner $1,700.97 Paul Venner $ 148.21 Christine Lawson $ 735.93 Allan Mogg $1,115.46 Lee Christison $1,185.92 I issued directions in this matter on 10 May, 2001. That Further Directions Order was sent to the parties on that day. The directions of relevance in this proceeding are as follows:– “1. That the Respondent supply to the Applicant, and lodge in the Commission, statement(s) of evidence, from all witnesses to be called and which are to be relied upon in the hearing, by 4.00 p.m. on Tuesday 5 June 2001. … 3. Leave of the Commission will be required should either party seek to adduce further evidence in chief beyond that contained in the statements of evidence filed pursuant to orders 1 and 2 hereof. Captive Services Pty Ltd filed no material in accordance with Direction 1 and no leave was sought to adduce evidence in chief at the hearing of the matter. Captive Services Pty Ltd chose not to call any evidence in these proceedings. Mr Cummins for Captive Services Pty Ltd did however seek to rely upon two documents that were eventually put into evidence. The first document is Exhibit 5 which is a list of employees said to be employed pursuant to the terms and conditions of the Agreement. The second document is Exhibit 6 which is correspondence from Australian Retirement Fund to Captive Services Pty Ltd. It was only after the ALHMWU were given the opportunity to contact Australian Retirement Services to confirm that the content of Exhibit 6 was correct that this document went into evidence. During the course of the hearing Mr Cummins also submitted the following in reference to s. 405 of the Act:– “… There was also a section in there saying that we had to have written proof that that was fine, that the people elected to go ahead with the Westpac Superannuation and we’ve got a submission with all their signed documents in that respect.”. In that regard Mr Cummins for Captive Services Pty Ltd sought to rely upon documents said to be the written agreement by employees to have superannuation contributions paid to Westpac Business Superannuation rather than Australian Retirement Fund. The documents were said to be in the same form as the document attached to the Affidavit of Lee Ann Christison. In that regard the letter from Captive Services Pty Ltd to Ms Christison dated 4 June, 2001 relevantly provides:– “As you are aware your superannuation contributions are being paid into Westpac Super, in accordance with the information provided to you directly by Westpac. It has come to my attention that we have not obtained the signed consent forms for our payments into Westpac Super on your behalf. -- 2 of 4 -- 6 July, 2001 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 251 I attach the required forms to be signed. Could you please return these forms as soon as possible by either fax or mail to: …”. The document said to be attached to that letter relevantly provides as follows:– “Superannuation Contributions Section 405 of the Queensland Industrial Relations Act 1999 allows employees and employers to agree to nominate a superannuation fund of their choice to receive contributions required to be paid under a State Industrial Instrument. Subsequent to our earlier discussions, I now formally nominate Westpac Business Superannuation as the fund of my choice. This fund is a complying superannuation fund suitable for this purpose and is administered by Westpac Securities Administration Limited. As the employee I state that no coercion has been applied to coming to this decision. Signed below on my own behalf as the employee:”. It is clear that Captive Services Pty Ltd has not, during the period 16 February, 2001 to at least sometime after 4 June, 2001, had the written consent of its employees to contribute to a superannuation fund other than the Australian Retirement Fund which is the superannuation fund prescribed in the Agreement. It is also common ground that Captive Services has not since 4 June, 2001, in so far as thirteen of its employees are concerned, complied with the provisions of Clause 3.5 of the Agreement. The issue then becomes whether s. 405 of the Industrial Relations Act 1999 (the Act) has application. Section 405 of the Act provides as follows:– Agreement about superannuation fund “405.(1) This section applies if an industrial instrument requires an employer to pay contributions to a specified superannuation fund. (2) Despite the instrument, the required contributions may be paid to a complying superannuation fund agreed to by the employer and employee. (3) The agreement must be written and signed by the employer and employee. (4) A person must not coerce someone else to made an agreement mentioned in subsection (3). Maximum penalty for subsection (4)––40 penalty units.”. The term “industrial instrument” is defined in Schedule 5 to the Act to include a certified agreement. Section 405 requires that any agreement by an employer and employee to make contributions to a complying superannuation fund other than the one prescribed by the Agreement must be in writing and signed by the employer and employee. Further, subsection (4) provides that an employee must not be coerced into signing such an agreement. As there has been no mention made of any written agreement signed by the employees prior to 4 June, 2001 Captive Services Pty Ltd is required to make superannuation contributions to the Australian Retirement Fund in respect of all employees covered by the Agreement for the period 16 February, 2001 until at least 4 June, 2001. As I have mentioned previously, Mr Cummins did indicate that he had written documents signed by employees similar in terms to the attachment to the Affidavit of Ms Christison. These documents are not in evidence. The ALHMWU objected to such documents going into evidence from the bar table. I have some comments to make in respect of the correspondence attached to Ms Christison’s Affidavit. The majority of employees of Captive Services Pty Ltd whose employment is covered by the Agreement must have voted in favour of the Agreement at a time prior to 16 February, 2001. The Agreement requires Captive Services Pty Ltd to make superannuation contributions as are required to comply with the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992 to the Australian Retirement Fund in respect of full-time, part-time and casual employees. The fact that a majority of employees voted in favour of the Agreement (and therefore Clause 3.5) at a time after the employer had made arrangements with Westpac Business Superannuation is, in my view, important when looking at the correspondence forwarded to employees on or about 4 June, 2001. The correspondence does not refer to any prior verbal authority received from employees to contribute to the Westpac Business Superannuation. The correspondence simply refers to the fact that contributions have been paid into the Westpac fund in accordance “with the information provided to you directly by Westpac”. The correspondence then goes on to state that it has come to the attention of the employer “that we have not obtained the signed consent forms for our payments into Westpac Super on your behalf”. There is no mention made in the correspondence as to where the requirement to have a signed consent is found. There is no suggestion in the correspondence that employees could have a choice of superannuation funds. There is no mention made of the requirement in the Agreement to contribute to the Australian Retirement Fund unless written consent is obtained to make contributions to another complying superannuation fund. The document required to be signed by the employee refers simply to the requirements of s. 405(3) and (4) of the Act in that it suggests that written consent is required and it states that “no coercion has been applied”. No mention is made of the content of Clause 3.5 of the Agreement. Whilst the document further states that “[a]s an employee I state that no coercion has been applied to coming to this decision” the evidence of Ms Christison is that on receipt of the correspondence and the attached document she thought she had no choice but to sign the document and she felt that she was being pressured and intimidated into signing the document. As it eventuated Ms Christison was not coerced into signing the document as she contacted the ALHMWU after receipt of the document and was advised not to sign the document. It would appear that the employees of Captive Services Pty Ltd have not been given sufficient information to make an informed choice as to whether they agree to having their superannuation contributions paid to a fund other than the Australian Retirement Fund. -- 3 of 4 -- 252 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 6 July, 2001 In those circumstances if Captive Services Pty Ltd wish to rely upon written agreements with employees (other than the five employees referred to in Exhibit 6) to entitle them to make superannuation contributions to a fund other than the Australian Retirement Fund then a document such as that attached to Ms Christison’s Affidavit is, in my view, insufficient. The informed consent of employees is necessary in order to comply with the requirements of s. 405 of the Act. That would require the employer to provide the employee with information such as the following:– - the current Agreement provision; - an analysis of the advantages and disadvantages of the Westpac scheme and the Australian Retirement Fund scheme; - material from both schemes which would enable the employees to make an informed choice. I have nothing before me which would indicate that employees have been given any information on either superannuation scheme. Until such informed consent is obtained from employees then Captive Services Pty Ltd must make superannuation contributions on behalf of its employees covered by the terms of the Agreement to the Australian Retirement Fund. The ALHMWU seeks an order under s. 407 of the Act. Section 407(1)(a) requires that for the section to apply there must be an industrial matter that relates to “an allegation that an employer has been, or is, contributing to a complying superannuation fund for employees at a level required by a relevant industrial instrument”. Captive Services Pty Ltd elected not to give evidence. The application does not make such an allegation. The only material before me from which I can ascertain that Captive Services Pty Ltd has been contributing to a superannuation fund for employees at a level required by the Agreement is:– (i) Exhibit 6 which identifies that Westpac Business Superannuation confirmed the transfer of contributions from its fund to the Australian Retirement Fund in respect of five employees; and (ii) The Affidavit of Ms Christison and the attachment to that Affidavit which indicates that superannuation contributions have been made on her behalf to Westpac Business Superannuation. In the circumstances I find that there is sufficient evidence before me of an allegation that Captive Services Pty Ltd have been to a complying superannuation fund for employees at a level required by the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992. I therefore determine that Captive Services Pty Ltd should have been, and should be, making superannuation contributions as are required to comply with the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992 as amended from time to time to the Australian Retirement Fund as that term is defined in Clause 3.5(1)(a) of the Agreement. I therefore order that Captive Services Pty Ltd make superannuation contributions as are required to comply with the Superannuation Guarantee (Administration Act) 1992 and the Superannuation Guarantee Charge Act 1992 as amended from time to time to the Australian Retirement Fund as that term is defined in Clause 3.5(1)(a) of the Agreement in respect of all employees whose terms and conditions of employment are covered by the Agreement. I order that such contributions be made as and from 16 February, 2001. Such superannuation contributions are required to be made to the Australian Retirement Fund in respect of all employees unless and until Captive Services Pty Ltd obtain an informed consent from any such employee. Once it has an informed consent in writing signed by an employee then Captive Services Pty Ltd may be in a position to rely upon s. 405 of the Act to make contributions to a complying superannuation fund other than the Australian Retirement Fund. I order accordingly. D.M. LINNANE Vice President. Released: 27 June 2001 Appearances:– Mr K. Crank, with him Mr G. Bullock for the Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees. Mr C. Cummins for Captive Services Pty Ltd. -- 4 of 4 --