Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees v Signet Identification Systems Pty Ltd [2000] QIRC 51 (2000) 164 QGIG 201

23 June, 2000 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 201 ########################################################################################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1999 – s. 229 – notification of dispute Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees AND Signet Identification Systems Pty Ltd (No. D298 of 1999) PAINT INDUSTRY AWARD – STATE PRINTING INDUSTRY AWARD – STATE COMMISSIONER BLOOMFIELD 14 June 2000 Dispute – Award Coverage – Argument as to whether company was engaged in “paint” or “ink” industry – Inspections by Tribunal – Witness Evidence – Evidence as to difference between paint and ink – End use of product – Similarity in product manufacturing processes – Arbitrated Matter – Commission found Paint Industry Award–State did not apply to company. DECISION The Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees (ALHMWU) notified the Commission of a dispute between the Union and certain of its members and Signet Identification Systems Pty Ltd (Signet) concerning award coverage. Mr J. Martin, who represented ALHMWU, informed me that the Union believed that several of its members engaged by Signet were engaged in the manufacture of paint and the products used to apply such paint, including aerosol cans. He said that eighty per cent of the work that they performed was work which could be covered by the Paint Industry Award – State. The employer had rejected the Union’s contention claiming that the company was actually producing ink and the work in question was covered by the Printing Industry Award – State. He said that the matter of award coverage needed to be resolved because it was the intention of the Union to pursue enterprise bargaining and it was essential that the award coverage question be determined for that reason. -- 1 of 5 -- 202 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 23 June, 2000 Mr M. Cuthbertson, who represented Signet, indicated that the company was properly engaged in the printing industry and performed a whole range of work properly covered by the Printing Industry Award – State. Included in the company’s product range was an ink product which was applied as a signate mark, usually by an aerosol can. The dispute was about the proper award coverage of this work. The Commission conducted an on-site inspection which involved a complete walk-through of the company’s operations as well as a particular examination of the disputed work. During the course of the inspection the Commission was shown the company’s labelling and printing production operations; its laser printing equipment sales and repair section; its stencil, stamp and custom printing manufacturing sections; its warehouse and dispatch operations; and its dangerous goods and maintenance areas. The Commission was also taken to its marking systems area and shown the disputed “ink” mixing operation; the aerosol production operation; the plastics injection moulding operation; the “ink” filling operation and the product assembly operation. During the course of the inspections all of those present were able to discuss with various staff the nature of their work and the nature of the company’s product range. The disputed work included the manufacture of what was described as the company’s aerosol stencil sprays, fluoro marking sprays, line marking “paint”, spot marking “paint”, one shot ink and each products’ respective container/applicator. During the course of the inspections Signet’s Managing Director, Mr Mark Brennan, informed myself and other members of the inspection party that the company had begun its operations in industrial identification through sales of stencils and ink. In its early form ink was applied by roller over the top of a stencil to such products as wool bales, timber, cartons and the like. Over the last thirty years or so the product range had expanded to suit the ever- changing needs of industry. The company now marketed a variety of specialised labels and label application equipment such as ink jet sprays, as well as a variety of specialist inks, aerosol marking sprays, stencils and other packaging materials and applicators. Mr Brennan said that the disputed product range was entirely used for marking purposes and that none of it was applied for decorative or surface protection reasons. Even the products (above) marked “paint” were used as a signate or for marking. The product contained within the aerosol cans used a unique trigger cap for easy inverted marking on roadways and building sites (such as could be seen at p. 55 of exhibit 3), on trees which were to be culled (p. 45) and in such specialist areas as underground mines (p. 56). In resumed formal proceedings evidence was given by Mr Ross Harry, the company’s Operations Manager. Having regard to the dispute as to whether the company manufactured paint or ink Mr Harry’s evidence was particularly enlightening. He had worked for Dulux Australia Limited over a twenty-three year period during which he held a number of positions including Manufacturing Manager – Padstow, New South Wales, Production Manager – Rocklea and Engineering Manager – Rocklea. During that time he gained an in-depth exposure and understanding of paint manufacture including raw material acquisition, product mixing, manufacturing and packaging. He said that having worked in the paint industry for twenty-three years and in the ink industry with Signet for the last three years he was of the belief that the ink products manufactured at Signet differed from paint in a number of areas. These included raw materials, product formulation, processing, packaging, product characteristics, and product end use. He said that Signet’s ink products were formulated using dyes and pigments in low mixing ratios. They were also formulated using low ratio resin binding systems. Signet’s products did not contain lead/zinc driers or coalescing agents to aid drying, film build or film integrity. On the other hand, paint products are formulated using high pigment and resin loading ratios. This is necessary to achieve the required film build to obtain a protective and/or decorative finish. Paint products also require driers and coalescing agents to form the film. Such was not the case with inks produced by Signet which have low film build and are formulated to penetrate or etch into the surface. Mr Harry said that a large number of Signet’s ink products are produced using liquid dyes and fluorescent powders. In his experience liquid dyes are not used in paint manufacture and he was aware of only limited use of fluorescent powders in paint manufacture. He also said that both ink and paint is manufactured using slow stirring or high-speed dispersion and milling machines. Such equipment was generic for milling and mixing of powders and liquids through a number of industries, including ink and paint. He said that Signet uses volumetric pumps to fill ink products into plastic squeeze containers and drums fitted with pourer spouts and taps. Whilst he had used similar equipment in the process of product filling in the paint industry, ink had a lower specific gravity and viscosity and, as such, could be drawn from floor level. On the other hand, paint had a high specific gravity and viscosity and needed to be presented to the filling head by gravity feed or other pumping methods. Mr Harry also said that Signet’s aerosol and ink products are formulated for specific end uses. They are designed to write, mark or print a directional message onto the ground, trees, pipes, timber, steel, and a range of industrial products. The aerosol products are fitted with special actuators designed by Signet to satisfy a specific end use requirement. For example, the trigger cap used on Signet’s spot marking spray (i.e. “paint”) is designed to give a thin line ideal for writing on overhead, vertical and horizontal surfaces. Front spray actuators, such as those used in Signet’s colour code sprays and forestry sprays, are manufactured so as to give a concentrated spray for writing. Signet’s aerosol inks and ink products are generally low viscosity, low density, low pigment and low in resin that provide little, if any, corrosion protection or decorative appearance. They were designed to provide a low cost marking solution where a durable or protective coating and appearance was not a priority. On the other hand, from his experience in the paint industry, paint products are specially formulated to provide a protective and/or decorative coating to surfaces. Paint utilised a much higher pigment and resin loading system. It was also higher in density and viscosity than the ink manufactured at Signet. Paint was designed to be durable, to offer corrosion protection and to give a decorative appearance. Paint was used to give a protective, durable and decorative coating in the domestic, architectural, marine, structural engineering and automotive industries. Mr Harry said that Signet’s aerosol inks were used for ground marking, tree marking, warehouse and factory lane marking and stencilling. Its other inks were used for timber branding, wool bale marking, carcass coding, and generally by industry to record production or directional information on their product. -- 2 of 5 -- 23 June, 2000 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 203 Mr Harry also tabled confidential statistics of the company’s production in the disputed areas. These disclosed that the ratio of basic inks to aerosol products was approximately 1:3 and that ink and aerosol production combined represented approximately 17.5% of the company’s overall sales volume. Under cross-examination by Mr Martin, Mr Harry claimed that the company had used the term “paint” at several points in its buyers’ guide (exhibit 3) because it was a generic marketing terminology. He agreed that the use of the term would give the customer an understanding of what the product was. He also agreed that the company’s buyers’ guide index showed the aerosol products as “paints” under the letter “P” and not as inks under the letter “I”. In answer to a question about how the company’s ink was applied Mr Harry answered that it could be through special applicator tools or re-fillable cartridges, some examples being ball marker pens, special brushes, unconventional rollers and ink jet coating systems. He also agreed that ink was traditionally applied through offset printing stereos. In his submissions Mr Martin said that for the very same reason that the company was in the ink industry by virtue of its manufacture of ink, the company was in the paint industry by virtue of its manufacture of paint (p. 29). He conceded that whilst that would cause some difficulty in determining who might be employed where, and at what time, it was not to say that the employer could not be covered by a number of awards at the one time. He submitted that the company’s buyers’ guide index, and the inspections, clearly established that a number of paints were made and marketed by the company. Mr Martin said that the definition of “paint” under the Oxford Dictionary was “a solid colouring matter dissolved in a liquid vehicle used to impart colour by being spread over a surface”. He said that the definition did not require the product to be “decorative” and nor did it require it to be “protective”, as had been suggested by the company throughout the proceedings. In Mr Martin’s submission the end use of the product was not important. What was important was how it was manufactured and how it was applied. He said that the Oxford Dictionary defined “ink” as “the coloured, usually black, fluid ordinarily employed in writing with pen on paper, parchment etc or a viscous paste used in printing”. Mr Martin also said that whilst the inspection had disclosed that the company did manufacture some ink it had also disclosed that the company manufactured paint – as that term was commonly understood – as well as the applicator to house and apply that paint. The coverage clause of the Paint Industry Award – State clearly applied to those persons involved in the paint manufacturing process as well as to those involved in manufacturing the various parts of the applicators such that the finished product was suitable for marketing purposes. This included the persons engaged in the filling of the aerosol cans. Accordingly, the Commission was asked to decide that the terms of the Paint Industry Award – State applied to the disputed work. Mr Cuthbertson submitted that the real issue for determination by the Commission was whether the Paint Industry Award – State was broad enough to cover certain employees employed by Signet. In this regard the ALHMWU, as the applicant, was required to make a substantive case in support of its contention that the Award applied to the seven employees working within the marking systems area of the business. Those seven employees were engaged in the general positions of mixer and line operator/packer in the task of filling and packing aerosols and other containers as seen on the inspection and as shown in the company’s buyers’ guide. He said that the inspections highlighted that the company manufactured and distributed a diverse range of products, systems and services for the purpose of printing and/or marking. Mr Cuthbertson also referred me to several cases concerned with the principles of award interpretation and submitted that I was required to consider the whole of the terms of the Paint Industry Award – State before I could determine whether that Award applied to the employees in question. In that regard clause 1.5 – Coverage required that an employee be covered by a classification included in the Award and for the employer to be engaged in “the manufacturing and/or processing of paint and/or varnish and/or associated products in a paint and varnish manufacturing establishment”. It was submitted that neither of those conditions had been met. The company was not engaged in “paint and/or varnish manufacture” and nor were there classifications for the employees involved in the dispute. Like Mr Martin, Mr Cuthbertson also took me to dictionary definitions of the terms in dispute. He said that the Macquarie Concise Dictionary, third edition, defined “paint” as “a substance composed of solid colouring matter intimately mixed with a liquid vehicle or medium and applied as a coating”. It defined “ink” as being “a fluid or viscous substance used for writing or printing”. He submitted that the ordinary person on the street would accept that ink was a product that could be used to print and/or mark by some form of applicator, whether that be a pen, ink jet printer, a printing device, a marking device, a stamp pad or, in the company’s submission, by an ink aerosol spray. By contrast, he submitted, the ordinary person in the street would understand paint to be something quite different. It would be a product used as a decorative and/or protective coating applied to surfaces. The ink products manufactured by the company were designed for a completely different end use. Conclusion The ALHMWU has argued that the Paint Industry Award – State applies to certain of its members employed by Signet at its operations at Wakerley. The employer has identified that seven of its employees are engaged in the manufacture of the disputed products and on the filling/capping/packing line for those products. The Commission as presently constituted has had the opportunity of a detailed inspection and explanation of the disputed work as well as the opportunity of hearing from the management and employees involved. Further, I have had the benefit of hearing evidence from Mr Harry who has had twenty-three years experience in the paint industry followed by three years in his current employment with Signet. It is easy to understand how the dispute has arisen and why the parties are at odds about the appropriate award coverage. Not only does the disputed product look like paint to a lay observer, it is also packaged in a similar way to aerosol cans of paint and, in several instances, described by the company itself as “paint”. -- 3 of 5 -- 204 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 23 June, 2000 In that regard the evidence of Mr Harry was most revealing. His undisputed evidence was that whilst there were certain similarities in the product manufactured by Signet and the product manufactured by paint companies, the product manufactured by Signet differed from paint in a number of areas. These included raw materials, product formulation, processing, packaging, product characteristics and product end use. After considering his evidence (above), what I saw on the inspections and my own knowledge of industry, it is clear to me that – with three possible exceptions – the products manufactured by Signet are not paint. The three possible exceptions are the manufacture of “line marking paint”, the manufacture of “cover-all tan” and the manufacture of “steel colour coding”. Those three products aside, it seems to me from my inspection of the company’s operations, the evidence of Mr Harry and my own knowledge of areas where the company’s products are used, that the products have been manufactured with a particular end use in mind. That end use has been for marking a particular product, item or surface for the purposes of identification or disclosure to someone who might look at the end product, item or surface. In particular, I am not satisfied that the great bulk of the disputed product is “paint” as that term might traditionally be understood. In that regard, the Paint Industry Award – State is of no assistance. The Award contains no definition of what constitutes the “manufacture and/or processing of paint and/or varnish”. Similarly, the definitions of “paint” referred to by Mr Martin and Mr Cuthbertson are of little, or no, assistance. However, each of the definitions of “ink” seem to suggest that ink is used to impart some form of words or message onto the intended surface by application of a coloured fluid, paste or viscous substance. “Paint” on the other hand is suggested as being a product which is “spread over a surface” or “applied as a coating”. The purpose for which the product is used would therefore appear to be important. Further, the Shorter Oxford English Dictionary sheds some light on the term “ink”. It suggests that inks are distinguishable by their colour or “by the purpose which they serve, as copying, lithographic, marking, printing (or printer’s), writing ink; by some special quality . . .”. It thus appears that ink might have a different composition depending on its intended use. In this regard it is noteworthy that the company has argued that the disputed product is marking ink. Consequently, after looking at the company’s products in turn to consider whether they might properly be regarded as “paint” or as “ink” I have determined that all bar three of the company’s disputed products should be regarded as ink. Dealing with the disputed products, in turn, as they appear in its buyers’ guide (exhibit 3), I record why I have found the product to be ink and not paint. • Page 34 – Stencil Spray – Stencils have traditionally been ink based and applied by a roller. The move to application of the ink by an aerosol is simply a development in the method of application and does not change the product, or its purpose. It is still an ink used for marking a particular product. The product is not intended for use by being spread over a surface or applied as a coating as a paint would be. • Page 39 – Oneshot Ink – This product is simply a new form of the traditional stencil applicator. The product is clearly ink and its use and purpose has been unchanged for centuries. Again, the product is not intended for use by being spread over a surface or applied as a coating. • Page 41 – Aerosol Stencil Spray – This is the same product mentioned at page 34 (above). • Page 45 – Fluoro Marking Spray – According to Mr Harry’s evidence this product contains fluorescent powders which are rarely used in paint manufacture. Further, the product is designed for use either as a direct marker or with a stencil. It is not used to coat, decorate or protect the item to which it is applied. The nozzle is also designed for the particular end purpose i.e. direct, narrow application to the surface for the purpose of marking. The product is not intended for use by being spread over a surface or applied as a coating. • Page 55 – Spot Marking Paint – The end use of this product is very similar to that of the fluoro marking spray above. It is designed for inverted marking on roadworks, building sites, golf courses, sporting areas etc. The nozzle shape and applicator mechanism are designed to allow direct application of the product to the end surface without the need for a stencil. In that regard it appears to simply be a new marking device which allows markings to be applied to areas which might not have previously been able to be marked by traditional stencil methods. The product is not intended for use by being spread over a surface or applied as a coating. • Page 56 – Layout 360 – Except for the 360 degree nozzle, which allows horizontal and vertical writing, this product appears to be the same as the one immediately above. The three products which appear to be closer to paint than they are to ink are the “cover-all tan” mentioned at page 42, the “steel colour coding” mentioned at page 44 and the “line marking paint” mentioned at page 54. I say “closer to paint than they are to ink” solely for the reason that each of the intended purposes is somewhat different from the other products in dispute. I have no direct evidence about the material make-up of the product. The “cover-all tan” is designed to be used for surface coating to cover over other markings. In that regard it fulfils the job that paint would fulfil. It is not suggested that the cover-all tan is used as any form of marker. The steel colour coding applies a coloured surface to the end of steel. Whilst the colour that is applied might be a marker in itself the application of the product is in the form of a sprayed coating to the end of the steel. The line marking paint seems to be intended for long term marking of lines in factories, carparks etc. It is also applied in straight lines as a surface coating. Whilst it might mark the boundaries of certain areas its intended use is more permanent than any of the company’s other products. However, looked at as a whole, the manufacture of these three products, considered amongst the whole range of the products in dispute, would not cause the company to be covered by the Paint Industry Award – State. To be covered by that Award the employees in question would need to be working for the major and substantial portion of their time on work covered by the Paint Industry Award – State. In that regard, I am not satisfied that the employees who might be involved in the manufacture of the three identified product lines are involved in the manufacture to such a degree that it would occupy them for the major and substantial portion of their time. It is not good enough for them to be covered for short periods of time on the manufacture of the product which I might have identified as being closer to paint than to ink. Rather, the evidence suggests that they would spend the vast bulk of their time engaged in the manufacture of ink products (as they have been identified above) which is an operation not covered by the Paint Industry Award – State. -- 4 of 5 -- 23 June, 2000 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 205 Accordingly, I have decided that the Paint Industry Award – State does not apply to any of the employees employed by Signet Identification Systems Pty Ltd at its operations at Wakerley. The Commission determines accordingly. A.L. BLOOMFIELD, Commissioner. Appearances:– Mr J. Martin for the Australian Liquor, Hospitality and Miscellaneous Workers Union, Queensland Branch, Union of Employees. Mr M. Cuthbertson, of the Queensland Chamber of Commerce and Industry Limited, Industrial Organisation of Employers, with Mr R. Harry and Ms R. Fahy for Signet Identification Systems Pty Ltd. Released: 14 June 2000 ########################################################################################################################## # Q -- 5 of 5 --