Bowler v Queensland Electricity Commission [1994] QIRC 548 (1994) 147 QGIG 922

922 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE [28 October, 1994 ####################################################### QUEENSLAND INDUSTRIAL RELATIONS COMMISSION Industrial Relations Act 1990 s. 295 - application for reinstatement Kevin Robert Bowler AND Queensland Electricity Commission (No. B382 of 1994) ELECTRICITY SUPPLY INDUSTRY EMPLOYEES' AWARD-STATE COMMISSIONER BECHL Y 13 October 1994 Termination of Employment - Dismissal - Reinstatement - Order for Compensation - Extension of Time Granted - Sale of Gladstone Power Station - Transfer of Ownership - Transfer of Employees - Right of Employer to "Sell" Its Employees - Operational Requirements of Employer - Negotiations Areas of Concern - Log of Claims - Employment Conditions - Negotiated Outcomes With Varying Degrees of Agreement - New Award Contract of Employment - Job Tenure - Gratuity Payment - Redundancy Redundancy Agreement- Voluntary Retrenchment Not Availed Of- Alternative Employment - Industrial Relations Reform Act 1994 - Arbitrated Matter - Applicant Refused to Transfer to New Employer - No Suitable Alternative Employment - Applicant's Refusal to Accept Continued Employment at Gladstone Power Station Was Unreasonable - Termination Not Harsh, Unjust or Unreasonable - Orders for Compensation Refused - Application for Reinstatement Refused. DECISION The issue before me is an application by the Federated Engine Drivers' and Firemens' Association of Australasia Queensland Branch, Union of Employees (FEDFA) on behalf of one of its members, Mr Kevin Bowler, for reinstatement to his former employment with the Queensland Electricity Commission (QEC), at the Gladstone Power Station, and that he be paid for lost wages from date of termination (30 March 1994) to date of reinstatement. In the alternative the applicant seeks payment of an amount prescribed in the QEC/Union Redundancy Agreement. The application was filed approximately two weeks beyond the prescribed 21 days for filing such application which necessitated the applicant seeking an extension of time to enable this matter to be dealt with. The application for extension of time was strenuously opposed by the QEC but, in view of the short period by which the application was out of time, the reasons for delay in filing, the manner in which the argument developed on this issue and, significantly, the importance of the issues arising out of the matter, I decided to proceed and hear the matter, thereby granting the extension sought. BACKGROUND Mr Bowler had been employed by QEC for approximately 14 years, most recently at the Gladstone Power Station. That facility was sold by the Government to Comalco, the operators of the aluminium smelter at Gladstone with ownership being transferred on 30 March 1994. Mr Bowler refused to transfer to the new employer and his employment was terminated. He was not paid any redundancy payments on termination. (While initial negotiations referred to herein took place with Comalco, the Company which finally became the operator of the Gladstone Power Station was NRG Gladstone Operating Services Pty. Ltd. However, for convenience all references in this decision will be to Comalco.) To fully appreciate the issues it is necessary to summarise the events leading up to the transfer of ownership of the Power Station. The history of the negotiations is set out concisely in exhibit I together with a joint document dated 11 August 1994, prepared at my request, setting out agreed dates and content of negotiations with further material, also prepared at my request, which deals with meetings between the Unions, delegates and members during the Gladstone Power Station sale process up to and including 26 March 1993. On 11 August 1992 the State Government informed Secretaries of relevant Unions that the sale of the Gladstone Power Station was imminent. Indicators of this sale had been given earlier in 1989. At this meeting the Unions expressed concern at the sale and the future of members employed at the Station and raised issues for consideration including preference in employment at a power station under construction at Stanwell for members who did not wish to become Comalco employees; salary and conditions of employment under the new ownership; quality of working life in private enterprise and superannuation. On the following day the Government publicly announced the sale of the Power Station. On 13 August 1992 employees at the Gladstone Power Station presented a list of concerns to local management at Gladstone. On 18 August 1992 discussions commenced between Comalco and the Unions representing employees at Gladstone when it was indicated that a final decision on the purchase of the Station would not be made until December 1993. The Station was to remain as a component of the supply grid with QEC becoming a customer of Comalco or the operating Company which it set up to operate the Power Station. On 21 August 1992 a mass meeting of Gladstone Power Station employees was held and the following resolution passed:- "Whilst the Union's preferred position is the continued public ownership of all Queensland's major electricity generating facilities, we acknowledge the sale of G.P.S. under the conditions proposed by the Qld. Government may eventually be of benefit to the City of Gladstone, particularly in providing additional employment opportunities. However, we believe a number of issues surrounding the sale need to be addressed by the Govt. if we are not to take a stand in opposition to the sale. Consequently, our co- operation in the exercise will be conditional upon the Govt. satisfactorily addressing our concerns prior to the final sale taking place and as the negotiations between the parties proceed we will, from time to time, review our position and respond accordingly. Our concerns include the following: The maintenance of satisfactory levels of employment at the station both in the lead up to and after the sale. No reduction of the current employment conditions package (including superannuation and housing entitlements) by the new owners. 1' 1 'i 28 October, 1994] QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 923 Satisfactory re-deployment and re-training options being agreed for all employees who wish to remain with the QEC. Appropriate voluntary redundancy packages being available for current employees of the station who seek that option. The Govt. to facilitate the reaching of an industrial agreement to our satisfaction, between the Qld. T & L.C. on behalf of all Unions represented at the station, and the new owners. The Govt. to support and facilitate the involvement of senior delegates at all T.L.C. co-ordinated negotiations with QEC and the new owners. G.P.S. employees authorise their elected representatives from Gladstone Power Station with support from their Unions to proceed with negotiations on the above basis. All negotiations are subject to endorsement by the rank and file at G.P.S. Further, we call on the Queensland Electricity Commission, The Queensland Government, Comalco, The Electricity Industry Unions and Gladstone Power Station Delegates to enter into negotiations on employment and other issues affecting Gladstone Power Station Employees as soon as possible and that such negotiations be held at Gladstone Power Station.". On 25 August 1992 employees presented the following list of their major areas of concern regarding the proposed sale:- "Redundancies; Superannuation; Housing/Rents; Long Service Leave; Sick Leave; Employment Numbers (Structure); Annual Leave(+ Loading); Credit Union; Award Provision; Re-deployment within Electricity Industry; Seniority (Length of Service); Union Representation (Preference of Employment); Contractors; Roster Systems/Shift Work; Call-out Agreement; Employees Medical Conditions (Light Duties, Etc.) (Medical Histories Records); Training; Apprenticeships; Pay Systems; Individual Financial Advice; G.P.S. ReliefFund; Medical/Health Facilities; Medibank/Medicare Make-up; Canteen Facilities; Subsidised Electricity to Employees; Higher Education Subsidy; Allowances; Dispute/Grievance Procedure.". On 16 September 1992 a long series of negotiations commenced between the Government, Unions representing employees and employees which eventually resulted in a series of agreements being reached on expressed matters of concern. This agreement opened the way for negotiations to commence with Comalco on conditions of employment to apply at the Power Station under Comalco's control. The following summary, while not doing justice to the fullness of the negotiated outcomes, is sufficient to indicate the nature of the agreements reached with the Government on a wide range of issues over a period of approximately nine months to satisfy employees' requirements before transfer to the new employer was accepted. Accrued Entitlements Employees to have option of cash payout and/or transfer of all or part of entitlements for annual leave and/or long service leave. Employee entitlements to be protected by the existence of:- (1) Certificate of Rights and back up Legislation. (2) Contractual arrangements between QEC/Government and Comalco. (3) Industrial Agreement/Award negotiated, before sale finalisation, with Comalco. (4) Entitlements based on current practices at Gladstone Power Station. Continuity of Service A Certificate of Rights to be provided in appropriate Legislation designed to ensure that:- Service with the Queensland Electricity Supply Industry (QESI) and future service at Gladstone Power Station shall be treated as continuous with one employer for taxation purposes. Service and entitlements accrued during service with the QESI shall be recognised while employment continues at Gladstone Power Station regardless of ownership. Superannuation Four options were made available to employees as follows:- Amend articles of QESI Superannuation Scheme to enable employees to withdraw their contributions plus interest and preserve balance of Members Reserve. Preserve all superannuation contributions m the relevant Industry Scheme and then join the Comalco Scheme. Amend the QESI Superannuation Scheme Articles to enable Comalco and any future private operator to contribute to the QESI fund on behalf of employees who wish to remain members of that fund. Full transfer of all Superannuation conditions, entitlements and benefits from QESI Scheme to Comalco Scheme. Gladstone Power Station Sale Completion Payment An amount of $2 million was negotiated to be allocated amongst employees subject to:- It to be paid only to employees who transfer; It depends on the successful completion of sale; It to be paid after transfer to Comalco, within 14 days; Lifting of bans and Unions and their members to commence negotiations with Comalco to further the sale process; All parties to participate in a constructive and co-operative manner with the sale process; -- 1 of 4 -- 924 QUEENSLAND GOVERNMENT fNDUSTRIAL GAZETTE [28 October, 1994 Payn1ent is not connected in any \Vay \\ ith tcnr1inat1on or redundancy or any similar claim in the log: Payment is part of a package and is not available except as foll and final settlement of all claims associated with the sale against QEC and the Government. /\ variety of reasons \Vere used to support the clain1 for a payment of this nature ro compensate employees. Of those reasons. those which appear to be relevant to the matter before me are:-- Concern over loss of job security: Limited opportunities for rt:-deploymenl for those employees wishmg tn remain within the industry: I ,oss of career path advancernent \Vith the electricity industry; Loss of early retirement at age 55, Ernployecs being fi)rccd to go into ernploy1nent ,vith an ensiployer not 1Jf their o\vn choosing ¼·hich appears to be a loss of their basic human righis; Older emp!oyees fear that they may be unable to ad;ust to the new work culture with Comalco: Employees arc worried about loss of award conditions and entitlerncnts. Housing Arrangements were made fi:ir various benefo:ial hou,ing schemes available tu employees. either QEC finauced or privately financed, to continue while employees were employed at Gladstone Power Station, irrespective of nwnership. Re-deployment Within the Electrici(v Industry Steps were taken to provide Gladstone emp!oyees ,vith detiils of all vacant positwns within QEC and with preference to be given to Gladstone permanent employees unless other employee applicants are part of n redundancy process. Voluntary Redundancy Package The Government adopted the p0saion that it would not enter into an 1 retrenchments whicli were not rciated to genuine reduction in jobs but did also agree that lt ,vould seek work reorganisation opportunities al Gladstone winch would provide scope for additionai genuine redundancies, subject to the standard redundancy agreement provisions. A survey wns conducted by lht: Unions lo detcrmim: the number of c1npioyees \\·ho genuinely objected to tran-::;tCrring to ernploynient \<Vith Cornako and corn~:spondencc \Vas sent by QEC to all cr:npk1yccs seeking infonnation from any such employees. (This will be dealt with later with particular reference to the position adopted b) the applicant.) Financial Advice Extensive financial advice was provided by the Government to all employees to a,sist them to make up their minds on the variou~ options available to them. Future Vacancies in the Queen.,!and Electricity Commission Operations It was agreed that, where subsequent to the fillallsal!on of ,,ale of Glads,one Power Station, a vacanc1 arose withrn ()EC operatic:m which was applied for hy an emp,oyee at Gladstone who rrnd mmsfrrred to Comako then that employee wonld be treated as a QEC imernal appliean! Personal Details H was agreed that no personal information would he transferred to Comalco without prior approval of the person concerned Relocation Costs It was agreed that QEC would not seek reimbursement of relocation costs at time of transfer of ov,11ership fr,r those employees who have relocated to Gladstone less than tweive months before transfer. (Sud-. costs \vould othenvise be recoverah1e \Vhere an e1nployce~ \vho was pnid relocation expenses, left the ernploy rnent of QEC before the expiry of twelve months from date of transfer.) The foregoing outcomes were negotiated betwec:n August 1992 and March ! 993 with varying degrees of agreement being reached during that period. The basis for these negotiations was a log of claims presented in November l 992 by the then Queensland 1 rades and Labour Council on behalf of empbvecs of ()EC employed at Gladstone Power Siation The negotiations were conducted, on the employees behalf. by a State Single Bargaining Unit in conjunction with delegates. Agreement on this point hy employee representatives was reached on 4 December 1992. During the coun,c of these negotiations employees were kept inforn«:d of the varying dcgrees of outcomes from time to time by way of communication through delegates. circulation of written material and mass meetings of all employees. The issue of redundancy arrangements was dealt with at varying times during these negotiations The Government" s position was that it did not n.:gard this as a redundancy situation, but did make available a process by which some employees. through a job reduction process. could be 1reatcd as genuinely redundant. The Government 'was not pn:pared to offor any gemcral access to redundancy payments under its Redundancy Agreemcnt because it was committed to transferring a folly manned Power Statton to Comalco. !t would appear that any geu~ral concern of employees for access to the existing Redundancy Agreement was addressed by the giving of h1nited access to the Agreernent r,n a genuine job reduction ba,is. the survey and response ot employees who had a genuine objection to transforring to Comalco; the position adopted by the (Jovernnwn: effectively guarante~i:1g contir:uity of sen.11ce ( mcluding treating service after transfer as service for the purpose of possible foturc employment m the electricity industry with Government operated power stations) and rhe formulation of the claim for a Gratuity Payment presented in early Februarv l 993 ( referred to earlier in this decision under the heading Gladstone Power Station Siile Completion Payment). "GENUINE CONCERN" StRVEY AND APPLICANT'S RESPONSE .A survey "va.s conducted by the {!nions concerned in th~ negotiations \Vhich. in part, sought infi.)rrnation from those cmp!t,yces ,vho were llOt prepared to work for Comako under ,m) circun1stanccs. By way of a memo to all stall on 17 March 1993 QEC advised that it had given an undertaking that it would be prepared to help e.mployees in this categor·y provided they identified themselves to QEC. An undertaking was given t.hat this mfnrmation would remain confid,;n,ial. Some thirt1:cn emp.loyees sought assistance under Ulis offer. 28 October, 1994] QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE Later, by letter dated 8 April addressed to Mr Bowler, QE( advised him that twenty-three posnions at Gladstone would be declared redundant. some of which wouid fall within his employment category. He 1vas mforrned that applications were being sought for voluntary retrenchrnent~ that assistance hy \Vay of estimates of benefits avaiiable would be provided to applicants, that the dosing date was 23 April i 99:J, that a cooling off period of two weeks would apply from that dak and that succc,sfol Bpplieants employment would terminate on 23 April 1993. fv!r Bowler neither infonned QFC that he was not prepared to work Ji,1 Coma!co in response to tht advice of 17 M:irch l 993 :rnr did he apply for voluntary retrenchment in rr,sponse to the letter of 23 April l 993, notwithstanding his evidence that he first U,ok exception to the prospect of vvnrking frH' sorneone else, other than QEC, in late ! 989. Mr Bowler.. in his evidence with regard lo these two ilt'ms of correspondence, advised he did not avail himself of the invitation offered on 17 March l 993 b1ecause he did not believe that there w;p; anything cnncretc about the sale, that it was purely an announecmem which was fairly vngue, that he did not want to "show his hand" at that stag\:. that he did not know what conditions of employment he was going to be working under and that there was a limited time to make an application for voluntary retrenchment an important decision. proposed in the letter of 8 April 1993. Jn response to a question as to whether he was aware that the Government had given an assurance !hat no employee would be disadvantaged by the sale he indicated that he had heard and read that and that he was "not particularly akin to taking much notice of political assurances. They tt;nd to lose their strength further down the track a, history shows.". lt was 1\fr Bowler's evide1;ce that he finally decided that he \Vould not accept transfer to Cornalco vvhen details of the nt:\:.,, ;nvard to apply al the Power Station became ki1mvn to him. This Award was the outcornc of negotiations between Comako and employee representatives at G!ad,tone Power Station. This Award was dealt with by the Commission on 23 March l 994 with an approved operating date of 30 March l 994, this being the date of transfer of owncr,hip. The Avvard \Vas brought to the C<.nnrnis:,ion Bs a consent matter and in its decision on the matter {145 QGlG 764--767) the following comments arc recorded:-· "Mr Kenney, appearing for the Minister for Employment. Training and Industrial Relations, outlined the background to and the purpose of the sale of the Glll(lstont: Power Station to pfr,,atc interests, He informed the Commission that in August ! 992 the Queensland Government entered into an agrecm,;nt to sell the GlJdstone Power Station to a eonsorliun; of companit.:s centred on Coma\eo primarily to enahlc the expansion of the Boyne Aluminium Smelter in Gladstone. Details of the expansion plans were provided. i\'!r Kenney then proceeded to infonn the Commission of the ncgoti0tion process tu craft an award which meets the expectations of the staff of the power station, the operational requirements of the power stallon and the commercial iequircrnents of the purchasing group of cornpanies. He aclvised the negotiations were conducted in two major pha,es. 'On their pan lhc Unions and their member, were not prcp(-tred to negotiate Viith the purchasing cotnpanies untd they '-"-'ere sat is ficd that the CJ0-vemn1ent \vould indeed ddiver the undertakm1, in relation !o no disadvantage. Tlus incluJcJ the ncgo,ia!ion of trJnsitional and preservation arrangements which \¾iOtdd on one hand give eflect to the Ciovemmenfs no disadvantage undertaking, but f)n the other hand \VOtdd ensure that en transfer of the station there v,...-(n1id be no or at kast n:iniinal ren1t1ining ernployrnent related links between the Gladstone l'ov,er Station (GPS) empioyees and ihe Queensland Electricity Comrnission. 'The results, if approved by the Commission, will provide protection and benefits for all of the stake holders in the Ciladstone Povver Station transaction. These stake hokt~r:~ include purchasers of the power slation, the .:mployees of the power station, the Queensland Electricity Commission, the Go\ernrncnt, 3.nd rnost iff,portantlyl the ec0numic vv-cll being oftbe people who !1ve in Queensland .. (r. 8) Ms Hoysted (for NRG Operating Services) said that it 1s the Ci:nr:pany;s long tenn aiffi. to have all crnployces \Vorking u1:.dcr individual employment agreements. Whilst not resiling from thm goal, the Company recognised ,hat such a fundamental change would not be tolerated by employees. Accordingly, an enterprise agreement was proposed but because of employees' concern to hove a safety-net award in p!ace, the focus on the type of industrial rcguiation changed. Thus, the proposed new A ward is drawn substantially from th<= Electricity Supply lndusl!) Employees Award - Stah: wgether with a number of regis1crcd and unregi:,tered agreements and two certified agreements which currently apply to employees at Gladstone Power Station. Mr Casey. appearing for the Australian Services Industrial Union of Lmpioyees, Qw::cnsbnd Branch (.ASU), al,o advised the ('onuni<;sion as to the backgn.Jund to the ne\s A\.Vard and ir: particular, the denvation of 11' tcnns and conditwns. Mr Casey's <:,ubtn_issions in support of the /\\vard \Vere primarily directed to argu1ncn1 over the hours of \Vork clause \Vhid1 provides Cor 36 J/4 hours per wec:k, the 'GPS premium' and the background to the making of the Memorandum of Understanding- S'.aff. ln respect to the hours Clause. Mr Casey infonncd the Cummisswn that the 36 l/4 hour week ha, hcen an award condition for white collar employees since 1977 and has been applied to all c;nployees at the Gladstone Po;,.\/C:f StJtion and in the electricity indu~try since October 198]. (iiven the longevity of ihe condition" the union pmiit!S sought its retention_ rv1r Case_y relied on !he provision in the First Award Prin.:ipic. that prima facic, existing conditions are to apply, to support lm submission. Further, reference was made to the lack of flow on implicat10ns if the claim \~'as granted. ;\.fr Casey also addressed the ·c;ps premium,. Ef.foctivcly, tlw premium is a consolidation of the majority of disabilit) allowances prescribed by the Ucctric1ty Supply Industry Aw11rd -- State. The Cornmission \V~Js infonYwd about the manner in ,vhich the prerninrn \vili he applied to ensure equity. \fr Williams. for The Electrical Trades Union of Employees of /\uslralia 1 ()ueensland Branch {ETU). :-:upported the rnaking nf the _A \Vard for fiiur n1ain reasons. vlz. :-- -- 2 of 4 -- 926 QtTEENSLAND GOVERN!\1ENT INDUSTRIAL GAZETTE 128 October. 1994 (i) i-t nwcts the ob_jccti,1es of the lndu.\tr,al Relations Acl !990; (ii'; it rnccts !he requirerncnt~ of th:::: ()ucensiand industriat Relations Commissior, m respect w first awards, \iii) it is an accurate re,;ord of the result of the negotiations with the Company: (i\·) lt is supponed by the rnajorit) of the n,ernbers of the lJnions crnploycJ~ at Giadstone Po\ver Station. The Cl'•rnn1issirJft \.vas advi:;ed that ncgotiaticms ovt;r the A \vard \v~r1; protracted and at tirne:~ d_\fficult g1ven the :'.,uspicion b} en1pk,y;;;cs of Cor:1ako and that the operating Cornpany \vas an unknu\VD quantity. t\1.on:>ovcr. l'tT1ployec::- \vere fearfld for their fi.1tur.::: and def~1rous of at. least n1uintaining thc1r cxi~ting ,vages ~-1nd z.:onditinns_ l\-1r \~/ilhmns als,.J saiJ e1npluyces \VCiT concerned that they \Vere being sold ald.ng vvith the plant and cq~-llprnent by the State CJovcr.nn1enL ]n his subrr1issH:ms. \h \,\.'l!;(,uns ad,;:.lres'.;ed d rrntnbcr of th!.: rnatt~r:s raised hy the previt)us advoca:e.~ anci put a Ji ffcrt=nt pcr:--:pcctive on certti:n of tht: issues can\':.!ssed by \'is Hoysttx! The rernaindcr ot his subn1issions thnroughly dealt vvith the provisions of the propos,cd ne\\ i\war:l Tills part of his subrrj'.Ssions g~ve the (\1n1tnission an understanding: of the contents or the fiocurnent and~ \vhere rclevanL ~':irovided [ff1 agreed i;1tcrpretJtion of the prescription:~. fv·1r Vickt~rs, 1~:}r r.hc r:cderated Iron"vvorKcrs /\ssociation (Queensland Branch) llnion of Empk,yees (HA), and ,',lr Bonding, for the At1h)motive, J\.-ietals und Engineering Industrial Lnion of Employ ecs, Queensland (AM H L), both supported the applicants. J'v1r Bending refCrred to a concern. of his Union over \\.Ork on the boil(:r front -! his rnatter is c:-.:duded fron1 th2 C!ladstone Po\vcr Station prerniurn but an alknvan,.:c t~ paid to releYJnt en1pioyccs \Vhen the <l]~;abiiit) is encountered. Exhibit 15 re!~rs. J\1r ·r-ricc. for the Federated .Engine Drivers' and r·ircincni;; A.s~uc!ati(m c;f Australasia QuccTY)1and Branch. Union flf Frnployec5: (FLI)F/\), 1n stipporting the i!pplication also 1nad1: reference to 1he \X)a} dust allov,,ancc and the probk1ns causeJ by the prP,vdery coai used at the ~;tation. Exhib.it 14 refers. A.U union advocate,,.;; paid tribute to the ruk~ of ~taiion d;:iegates fr)r their as:.i~:wnce ln th:: ncgntiafrng protcss. Iv1r JLuTis~ appcdring .f()r the ()ucens!znd .Electricity Co1nrnission \ ()FC\ advised uf 1ts support J(n both applications. !n her reply I\,!s Jin~ystcd coniirmt:d !hat \vhcre Mr \\,'iHia1ns had inJicakd that J.gn.:crnent had been rt~achcd hct\-Vet:n the purtir:~ 1nat \-\:;-1s indeed tbe c:1~;e. ·1 he parties havt: explained rnany (_if the proposed A\\'ard provisions to the Conunissi,_HL 1-krving hew·d the c;,plar:ations gi·.,;;-:n: the CP1n:rnissi:)n is :)atisfieJ that the proposed ,'-\V•./did is largely dnn,,-n frorn a nurnbt:r of industrial instrun1tnt:s already J.ppiyrn.g to 1.hc CHad::.;tont.: Pov...-er Station ;\'-.-'hii::;t under pubiic O\\.'Ocr~_,hip ). These have. hovv-c\.,,eL b(:en rnodificd in rekvant re:;pi.=:'cb :.o scit the operational requircrnent;; of the DC\\" O\Vti(:.:S. fviodifications such as tlH; consola.btion of a range of allo\vanct'S into 1ht' C!iadstuuc P(nver S:a(li.-.>n Prerniurn and tht~ sick !eave provlsidns can he sct;n us utilising the structural cfficienc) approach rath,;;r rhan O~ing contrary tr'l the First AwarJ~ Princ1pk. In 1he rc1cvaat circu1nsL.tnces, the Cornrniss1on b,~_ditves that. prirna facie, cxi:~t]ng rates and coridition0 hJxe bet:n rc!lectcd in tbe proposed /\v:ard. Dur-ing the course of the tiearing, the Conunis'.;:;J,Jn rai~ed a particular n1at~er of concern in rciation to ctm.sc 3.8 (\Vag~ fncreascs). This clau~,e sets out the rnanncr in \vhlch increases n1ight be abk to be aclnevcd. ()f particular conccn1 v.'as subcLause J 8. l \Vhirh outli.ncs the rn-echanisrns for adjusting v.-agc bands . .Su~x:l.ausc 3_8.2. provides that ;vage increasc.s n1n:,i- he available H1n)ugh the application of Corrnnission \"/age Principles. The Con1n1i:..;sion queried \vhethcr :subciau~cs 3.8. l and 3.8.2 \-Vere n1utuaHy exch1sl\·r;. The Connn!ssion \.Vas advised by f\fr Williams thnt they were n,,t nccessaril, so. Further cxpiz.nat!on vvas also pr0vided by !v1r \Vilhan1s of the intent of subdau,c 3,8. l, J have had the fJpportunity to revicvv th-:: subrni:~sions rnade on this point. Although it is sornc-vvhat nc;vel to h;:1·vc an rnvard claus.-,.: specifying the n1anner in \Vhi(h \'\·age increases tnight he attaimible, on ,he basis ,,,, Mr \\'illiarns' explanation, I am prepared to uccept its indu:~ion. I \Vo1dd ~ce this clause as having lixnited precedent value g:i..,,'en the agreed nature of the document and the particular circurnstancc~ surrounding its rnak1ng.''. The negotiated contents of this proposed :\ \Vard \Vere rnade kno\-v11 to c1np]nyees in earl) December 1993 and it \\,as at that tinH.: thal !\fr Bowler indicated he finally clecided not tu ,ram/er to Comalco. llowev.:r it was not until 5 lthrnary l 99,l tha, Mr Bowler conve:yeJ that dccisicm to QEC. The reason given for the delay in advising QEC of bi"i decision ;:vas that ·'neve:-- at any stage Jid I ever ft:e! thai i \Vas in soine sought of tinic l'.OtH.:- that ! had to perfonn strictly vvit.hin the boundarie3 of ''. i\lso, l\.{r Bo\vk:r had sought a legal opir:ion iJS to whether he "could b<e sold with the machintr)" buL oecause of the untimely death of th:: solicitor concerned, this \vas delayed until January 199,t 'fhat deci~;ion \Vas ackncnv1edgcd on i O February 1994 hy the l\-1anagcr (Jf the Po-vvcr ~tation and atte1npts vven: th,c;n rnade to find suitabk ah(:n1ative employinent fr1r Mr Bowler, ALTl-:RNA.T!\'E EMPLOYMEI\T There Js no doubt that genuine atte1nprs \vcre n1ade to find suitahle ahcrnatJ,.-c e111pl,._1yn1ent One position; that of a u6lity ;-;ervicen1an at Calhdc B Pov;t;r Staljon, \vas nnered to ivlr Bo"vlcr but n-:jectcd principally because of the n:duction in s:Jary· \vbich ,vrnild occur and lhe reduction in skills acquired 1,v.hich vvould be applied to the pesition \vlr Bn\.vkr also indicated an objtction 1c goir.g back to Cali:dc \\·here he had \vorked previ()Usiy, and to the prospt~ct of scUi.ng hjs hnu::;e in (dad.stone to trl.O\'C to Callide, {)n the otheT h;:-ind \1r Brn.vkr indicated that hi;;: ·wntdJ have hcen rnnrc likely tn accept the :;a1ne po.~i!.ion offored to hi1n at Ca.tilde if it hcid be.er: ce-t.Tt.:d ;:1t C!iad~!O!n::. in t;>arli,c 1• evidence he ,-nJicatcd a de51re !o 0\\.11 2 honte that overlook~ the sea as he had been brought up by the sea and h;::1.J .:~pc:nt tvvelvt: ycJrs of his \Vurking life at sea and \v.antt:d to continue his l} IC hy the sea. J-1()\vevcr in response ro exan;ination a~ to likelihood of acceptance of a position equi--.,,.n1en1 to that '.vhlch he h~id prior to tennination jf oflCred to hlrn at 1 arong Po\vc.r Station {t--tppruxirnately l 80 kms inland from the Coast), Mr Bowler responded ''\Vt:ll, l \voul<l hai.,·e .looked real L3V()urahk at it at the tirnc.''. in his evidence J'vir Ro\vkr stated that h,~ had not been enco:.iragt.~d by any officwi of 3:1) Union to lake the stand he has taken but rather he had be.en advised. in \Yritlng" by his Union (the l·T])FA) to transfr:r to Cornuko, pick up the rncmeys avai!ahk under the transfer arrangements and :mer seek a separation pa.yrncnt front Cumalco The scranHion or redundancy payrne:nt avallab;c froni (~ornalco \V~±:-i effective!) a nii?Tor or\vh«t \_.\,otdd hgvc bv:-n available from QEC 2X Octoher, 1994] QUEENSLAND GOVERNMENT fNDUSTRJAL GAZETTE 927 A1 I t'i\DER WHICH TI-IIS APPUC\TION IS HFAHB !\1r Bov. Ier \Vas tcrrni-:1uted \.Viih effect frorn l 0. 00 z.rn. \HJ \\iedncsday 30 tv1arch 1994, the date on \vhich the lndt,1Jfrial 1-{i-'/raions Rt/ann Acl ! 9.94 \\"(tS givr.::n A,'-.,senL This i\ct C\_Hnrr.c:H:ed er: th,.~ date uf A:.;;sent St> ihc\c procccdlngs \vill be dealt \.Vjth 1.mder that AcL (b; unless there is a valid reason~ cinrio)''Crs :,ervzci:. cst1bhs.tn11ent or ( a) h3v ing regard to the t'iTlployecs conduz.:t, c~p:.icity or perf~Jrmance l:!D.d Lhe operarional r-Dquircrnents, the flisrnissal is harsh~ unjusi or unreHso1;ah!c.'·. tn arplying the p:ovlsion~ of ~ub::.;ection 2(0} I have had :Tt~nrd to Schedule 10 of the /\et and the lcnninatio:n of Ernp!oyrncnt C\1n;,,:cntlo:n \\+ti~h in P:.Hi l] ~tandarJs of General /\p:11/cation. 'Divis inn A, - justlfica1ion fi)t Tem1inalion. Anick 4 provlde~ r.hat-- • 0 Thr..; crnployrucnt of a \\'Orker shnll not be tcnninated unless there is a valid rc;:!son for such t~rn1inhtiun connected ,vith the ~apcu.~it.y or :::01:\iuct of the \vorkcr Q.f based on the operat1on;:d rcquirc1ncnts of the undertakin~: cstab!ishn1ent or service A!though the Act (s. 2.91(2)(a)) suggests thJ.t both conducl c::.n._1ac-ity and per fr,:nrnnce should he con:'ltdcred ro;~\1..:thi:r with the upen1tio11al requir'.:'1nents nf the hLbinc~:), fof the purpose:,, of the niJth::·r before n;c i do :-Hn. cons!(L~:r it nece~sary to have ar:; n~gc..rd tu CPnduct etc. '<\l:iich tnay relate dircc!.f.v to pcri(1r.1nance of dutjt~s. !n any event this ,vas not rai~t'd a~; on issue before rn('. \-Juch tffgurnen! on behalf i:f the :ippL.::anf \Vas directed to the t1no1J,:c quc~:tinn :1s to v,:hether (!EC h::1d the right to ··sell'~ ib mnhontit:s on this n1;1tter. hefrffe 1nc. rc.f~_:rcnces ,,,,.:cTt: rn~Klc to '--'anous Hov,,'ever that is not the que:-.tion thn\ The qu;;;:stion :.!~ tn latvful Ji~rnis:,,;al roust be consl<ler('d unckr s 291 t{.' de!t_-:nninc \Vhcther OEC !rn_s acted ur.la\\·frdly To deterrnin,:: thc!t question there arc._ cs;')cnt:al!y, t\.\-c: n-utters ~o be c011sidcrcd ro k:st the valid it} nf the decision to t.:nninate 0 ·- i. \\/bet.her the ten11ination \va:, bar<:,,h Cir unjust or unreasonc\h!e having_ rci::~ard !n the operational rcquiren1cnt~ of the )y.__i:~lne'.:i~: and \Vbether the nGlicc or cotripfns:1iion requir~.d to be gi,:cn under s. 293 has in fau been giYeri h wi:.~uid appear tlF~!_. ir; Jv!r [kn-.,kr\; c;_;;.\e. the notice should be five \\td,.s o; cur:1p(;tbutinn f:t k:ast cqHal tn the tr,tal ar.~1oun1 ..:-i <)EC \Vi)uki h.Jvc bct:ri liable 'lo pay \-fr Bo\-vlcr if his err1pluy_n-n.:nl had c.:,nrinued through !hat notice period. \VAS Tm i ERM!l';ATIO'.\i IIARSH, OR L'\REASONABLE The ans\.ver tn this question 111ust in n1y vie\\", be ~ns\ve~ed in thr negative" There i\ :no qtiestion that the (.1oven11nt:nt had the right lo seU the Po\vcr Station and it v1.:01.dd sccn1~ 011 the rcf(:renccs qnotu..i by Nh Ca~~y on beha! f of the applicant. 1.Jia: the crnployn-:ctH l'.Ontr:;)t:ts \vith ecnployecs v/cre broken by {)EC That ho1,vever \Vo~:ld not ~uton1aticail) ;naLe such break of contract unla\\·'fui either v.-'ilh re~;pccl to th:Jse v-,h1) did not acquiesce to the transfer or fer those -...-vho did. Tlh: procc:-_;s of breakJng !\-1r Bov,.,,Jer·::; contract !Yiust be considered. ln this instance. ex\:cp~ perhaps for one and J-quar1cr hot~r~;' pay. fr;_; con1pe1bc.tion prescrib~d hy s. 293 has been paid and there is adequate and reaso1L:?bk reason frn· the terrnination based on the operational r~quircn1eots of the en1p1Gyer. fvh Bo,vlcr vvas paid a tot,1l of $i3, l 18.95 on tcnnination, this being nude up of a range oi accrued entitltrncnts as 1,,vcil as payrnent in lieu of notice of an {:"'.nount cd~ )3_ 7 5 L2.\ this an1ou11t being cakula!ed on 180 hours' work_ It is c\·idcrH that in th:: f'.1cc of the .r-.~hJsal ~t short noiicc of \/4r B;.)\vkr to transf~r to Con1alco~ (Jt·,C hod nn suitable, acceptable ;,-:dtcn1ative ernpioyrnern in '\vhlch he could he ernp!oyeJ, Thtj only alternative anitable iD QEC Wi!S lo terminate Mr Bowler's cc1pioyn1cni in accotdance \vit~1 the requirernents of the ia\\/ applicable, in the circurns-Umccs er H1is parti('U!ar n1atter i1K:ludcd in \Vhich of course are the varioth negotiated outcorncs. J do nut find su('.h t,.:nninalion to be harsh or unju:;1. The negotiation •Jf these ouu::01nes nn b::.hal f of crnployees ivas m1thor_;:~ed b:,v resuiurion of 2 l August l 992 and QEC w,"re eniitkci to rely nn such outcomes as bei;:1g agreed reasotwblc an1t.:nd1nents to individual contracts of employment paiticu!arlv sn when associated ,,ith that aspect of the change in contracts negotiated v-/itl"'l CornJ.lcc• arl:)ing DUl of the nt:\\ A \,vard cf-..nte11ts. Fxcept t()r the po--sihle nberr~tion of nne a:1d a~quJr1er hours· pa:, ii \vouid sel:1n to rnc that the r~quin:rn.ents nf ihe la\v have been n1et \1r Bcnvler>~ t;;::rrn!nati<.m payn1cH!" in lieu of notice \Vas caJculatccl at l 80 hou.rs \Vhen.:.a~ five vvecks' payrnent on the basis of a thirty<~!x and a~-qu.Jr~er hoi_ff \-ve~k ,vo1...dd cquat~ to l 8 l and one~ ouartcr h,)tffS ., pa}. No cxphmatlon \V<l:3 giYcn as to the discre_pm1cy ir:. calcuLnicrr; Jn die event that the icquiren1cn:s of the ;\et Jn this n.:gard hJve .not been rnc-:t, nppnJpriatt- orders \Vill issut; l f ncccs:,ary. REOl''.\OA\CY J{riving ccune tv the conclu.~;frm that the di:s:nis:::a! or !vir Bo,,.;.,,.'kr was not I.n1.lav,:ful :~hould I give any con:.~ldcrution to the relief soughr vvhich proposes that QEC p;s:,, fv1r Ekn.vkr ''such an a.n1ount prcsc;-ibed in the ()LC/Uaio:n Redundancy Agt\::c;ncnt'' or ~-~~uch fun.her or other (Jrden~ as the Cnrrunission cunsiders approp.rialc)•. S11ch a course pf action \VOuJd nc1t appcrrr to he' avaiJabk in these cin:.'11n1stances under Part l 2 Division S of the A,cL Hrr-.vcver the circwnstances surrounding this !tpplication are :,uch as to ccHn_pt'.l tnc to cxJ.rnirc the argu1ne:1t raised on b;,;~hHlf of ihe appl.icant and to fftake ct\n1n1t~ra. 1 hnvc outiincd the basis ~Jf agreen1t:nt rcach<.;d in detailed negotiation bctv~\;i;;n the Gnvernrnent and tht: etnployees :::md Unions in.,;olvcd •shich enabled n~gotianons b~-t\veen_ ihe Unions anJ Ct)ffialco to proceed. it has t)ccn proposed that the exdu:--tons provided 11: thi.;: QEC Rt'ch1ndancy I\grer?ncnt do not preclude ·r.,,;r Bnv,:ler fron1 ernitlen-v-:n! tn the tJencfi:~ of that /\grcernenL -- 3 of 4 -- 928 QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE [28 October, 1994 I disagree. Clause 6 (Exceptions) of the Redundancy Agreement provides as follows:- "This agreement shall not apply in any of the following circumstances:- (a) Where an employee is offered suitable alternative employment with the Commission or elsewhere within the industry and such offer is unreasonably refused;". Was the employment on transfer to Comalco "within the industry", that is within the Electricity Supply Industry? Mr Casey, for the applicant, argued that operations of Comalco at the Gladstone Power Station could not be regarded as falling within the Electricity Supply Industry for a variety of reasons including:- Why would not the Government or QEC agree to a union suggestion to allow Comalco to become a party to the Electricity Supply Industry Employees' Award - State. Why are not positions with other private generators, such as those situated at Mica Creek near Mt. Isa, treated as being within the industry. It was also argued by Mr Casey that QEC has no contractual relationship with such private companies which supply power to the grid which would allow QEC to offer employment with any of such companies. It was then put that if QEC could not legally offer employment, an employee could not have been said to have refused an offer that was never made. The QEC did not argue that the present operation of Gladstone Power Station falls within the electricity industry. However, throughout the negotiations which brought about an agreement on a range of matters which cleared the way for Unions to begin negotiating with Comalco for an award to cover future Power Station operations, there appeared proposals from employees and/or the Unions to treat the new operator as being part of the Electricity Supply Industry. These proposals appear at various places in agreed material tendered during proceedings and subsequent to the conclusion of proceedings at my request. The outcome of these proposals that the new operator should be regarded as part of the Electricity Supply Industry can be seen in the following matters contained in exhibit 4, section 4:- 4.4 5.0(c) 7 II Continuity of Service Superannuation Housing - Continuation of certain benefits while employed at Gladstone Power Station irrespective of ownership. Internal Applicants - QEC to treat Gladstone Power Station employees who have transferred as internal applicants for future vacancies within QEC. Having come to the conclusion, in what could be described as a unique set of circumstances, that the operation of the Gladstone Power Station by Comalco should be regarded as being within the electricity industry for the purpose of deciding whether the Redundancy Agreement tenns were available to Mr Bowler on his tennination, it is now necessary to consider whether his refusal to transfer to Comalco was unreasonable and/or whether his refusal to accept the position offered at Callide was unreasonable. Although a significant part of the argument put forward on behalf of Mr Bowler went to the "right" of an employer to "sell" employees on transfer of ownership, only brief reference was made by Mr Bowler to an objection "to being sold". In his evidence Mr Bowler states that he first took exception to the prospect of working for someone other than QEC when the sale was first indicated in 1989. He also stated, when questioned as to why he did not avail himself of the opportunity afforded by QEC in March 1993 to employees who were not prepared to work for Comalco under any circumstances, that he " ... wasn't totally opposed (to working for Comalco) at that particular time." and that he " ... didn't know where it (the sale) was going, where it would end up.". This evidence inclines me to conclude that there is conflict with the proposition that he held a strong objection to being "sold" by QEC. In response to a question as to when he categorically decided that he would not accept being transferred to Comalco he stated that he "was 99 per cent sure when the announcement of the new award with a new employer came out.". The matters of particular concern about the new award were stated as being:- "Under the old award if you had a particular job, whatever that job was you were paid a specific amount of money for a specific job. Under the new award there was an element in that which was a perfonnance based element.". Although he stated he worked under a partial perfonnance based system he could see that the proposed system could be open to "abuse, favouritism, sycophancy". Mr Bowler also stated that "there was talk of contracts for the operational people and I've always been against contracts for ordinary workers." and that '10b tenure was another aspect". Whereas with QEC he had a "fairly pennanent position" with private industry "you weren't too sure what could happen to you". The Award which was negotiated between the Unions representing members and Comalco was clearly essentially a reflection of what was contained in the Award and Agreements under which Mr Bowler worked. While the new operator expressed the view that is was its desire to enter into individual contracts it recognised that this was impossible because of objections expressed by employees and Unions. The certainty of employment with the new employer seems to be no less than with QEC, particularly considering the restructuring process ongoing in the industry. Any retrenchment in the future at Gladstone would be dealt with through a redundancy agreement which was effectively the same as the one operating with QEC. The issues raised by Mr Bowler as to job tenure were dealt with by the Unions in the claim for a "Gratuity Payment" (referred to herein as the Completion of Sale Payment). Relevant matters put forward in support of that claim were:- "The security of employment (even in the existing climate) associated with employment at Gladstone Power Station as well as options available to employees with regard to transfer and promotion arrangements are not conditions that are guaranteed through employment at Comalco." "The employment contract (with Comalco) can not offer to those employees the non-quantifiable conditions associated with Government employment." "No assurances have been given that wages and conditions reflective of those existing currently will be transferred." l i i 28 October, 1994] QUEENSLAND GOVERNMENT INDUSTRIAL GAZETTE 929 "In the instance of the Gladstone Power Station, conditions such as maintenance of security of employment, ability to transfer and promotional prospects etc. are not quantifiable in their current fonn; but the analogy should be that they could be quantifiable and then reflected in an Agreement or Award. This equates to the payment of a gratuity.". Relevant specific items contained in the supporting log were:- "2.(g) Concern over loss of job security due to Comalco's expressed statement that the Gladstone Power Station was over staffed. 3. There are limited opportunities for re-deployment for those employees wishing to remain in the industry. This has been stated by Senior QEC management. 4. Loss of career path advancement within the electricity industry as most employees upon joining the industry were led to believe that advancement was a natural progression. 5. Loss of early retirement benefit at age 55. This has upset long tenn planning for some employees. 6. Employees forced to go into employment with an employer not of their choosing and this appears to be a loss of their basic human rights. 7. Older employees fear that they may be unable to adjust to the new work culture with Comalco and cause job loss.". I was infonned that Mr Bowler was involved in the negotiation process by way of attendance at meetings of employees where the issues were discussed and voted upon. The ultimate resolution, on an overwhelming majority of employees, was to accept the package offered by the Government in response to the concerns raised in the log for the "gratuity" and the other issues raised. Taking into account the outcome of all the matters raised by Unions on behalf of members during the negotiations with the Government and the outcome of negotiations as to conditions of employment with Comalco, I have come to the conclusion that Mr Bowler's refusal to accept continued employment at Gladstone Power Station as an auxiliary plant attendant but with the new employer was unreasonable. Additionally, while the offer of a job with QEC at Callide at a much lower salary could not be considered to be reasonable in some circumstances, Mr Bowler's delay in leaving until the last minute his advice to QEC that he would not transfer to Comalco contributed heavily to a situation where this was the only job to which he could be transferred at short notice. In not taking advantage of the offer made by QEC in March 1993 to those who did not wish to transfer to Comalco he excluded himself from the arrangements which were apparently entered into with the thirteen employees who did so respond. If his objections to being "sold" were of such strength to lead him to the decision not to transfer then it would have been prudent to signify such beliefs to QEC when the invitation to do so was offered. I have also taken into account Mr Bowler's evidence that if offered the lower paid job in Gladstone, he would have thought v~ry hard about it. This seems to suggest that, regardless of the reduction in income associated with the Callide job offer, Mr Bowler would have thought very hard about a job which enabled him to live by the sea. I find it difficult to accept the rationality of that proposition when essentially the same job as he previously held (auxiliary plant attendant) with the same conditions of employment were available to him on transfer to Comalco, together with an additional payment to compensate for the matters previously mentio~ed, a payment which he referred to as "a bribe but euphemistically called the Sale of the Station Payment.". Notwithstanding his view of the status of that payment it was demanded on his behalf, negotiated on his behalf and accepted by vote of the vast majority. The sale of the Power Station with subsequent negot1at10ns between the Government and Unions on behalf of members and those same Unions and Comalco could truly be described as unique and not falling within the embrace of various of the decisions of a variety of bodies referred to by Mr Casey where it was held that a redundancy occurred on sale or transfer of a business. It may well have been that the employment contracts would have been breached and a redundancy situation occurred on implementation of the sale arrangements except for the negotiated outcome finalised prior to the sale. The Government and QEC negotiated in good faith with Union officials and delegates representing members. While contracts of employment exist between each individual employee and the employer, the circumstances which occurred subsequent to 11 August 1993 are such as to create a reasonable belief by QEC that the outcomes negotiated by employee representatives were binding on each individual employee and effectively changed the individual contracts of each employee. QEC were aware of the contents of the resolution passed on 21 August 1992 and the subsequent decisions in December 1992 for the Single Bargaining Unit to conduct negotiations on behalf of employees which, of course, included Mr Bowler. QEC have argued that I have no power to make orders for compensation in the absence of a finding that the tennination of employment was unlawful. I concur, however, if a power did so exist I would decline to make the orders sought by the applicant. It is of course open to the applicant to test this matter elsewhere. R.E. BECHL Y, Commissioner. Appearances:- Mr L. Casey, with him Mr C. Price and Mr I. Buckley, for the Federated Engine Drivers' and Firemens' Association of Australasia Queensland Branch, Union of Employees. Mr P. Parsons, with him Mr M. Stiles and Mr M. Donahue, for the Queensland Electricity Commission. Mr G. Kenney and Mr J. Frazer for the Crown. Operative Date: NI A Decision - Reinstatement and Orders for Compensation Released: 13 October 1994 -- 4 of 4 --